About Great Ajax

Great Ajax Corp. operates as an externally managed real estate company. The company primarily targets acquisitions of re-performing loans (RPLs), which are residential mortgage loans on which at least five of the seven most recent payments have been made, or the most recent payment has been made and accepted pursuant to an agreement, or the full dollar amount to cover at least five payments has been paid in the last seven months; and non-performing loan (NPLs), which are residential mortgage loans on which the most recent three payments have not been made. The company conducts substantially all of its business through its operating partnership, Great Ajax Operating Partnership L.P., a Delaware limited partnership (the Operating Partnership), and its subsidiaries. The company may also RPLs and NPLs either directly or in joint ventures with institutional accredited investors. The joint ventures are structured as securitization trusts, of which the company acquires debt securities and beneficial interests. The company may also acquire or originate small balance commercial mortgage loans (SBC loans). The SBC loans that the company targets through acquisitions generally have a principal balance of up to $5.0 million and are secured by multi-family residential and commercial mixed use retail/residential properties on which at least five of the seven most recent payments have been made, or the most recent payment has been made and accepted pursuant to an agreement, or the full dollar amount to cover at least five payments has been paid in the last seven months. Additionally, the company invests in single-family and smaller commercial properties directly either through a foreclosure event of a loan in its mortgage portfolio, or, less frequently, through a direct acquisition. The company owns a 19.8% equity interest in its Thetis Asset Management LLC (Manager) and an 8.0% equity interest in the parent company of its Servicer through GA-TRS, a wholly owned subsidiary of the Operating Partnership. The company has elected to treat GA-TRS as a taxable REIT subsidiary under the Code. The company’s mortgage loans and real properties are serviced by the Servicer, also an affiliated company. In 2014, the company formed Great Ajax Funding LLC, a wholly owned subsidiary of the Operating Partnership, to act as the depositor of mortgage loans into securitization trusts and to hold the subordinated securities issued by such trusts and any additional trusts the company may form for additional secured borrowings. AJX Mortgage Trust I and AJX Mortgage Trust II are wholly owned subsidiaries of the Operating Partnership formed to hold mortgage loans used as collateral for financings under the company’s repurchase agreements. On February 1, 2015, the company formed GAJX Real Estate Corp., as a wholly owned subsidiary of the Operating Partnership, to own, maintain, improve, and sell certain real estate owned properties (REO) purchased by the company. The company has elected to treat GAJX Real Estate Corp. as a TRS under the Code. The company’s Operating Partnership, through interests in certain entities, as of December 31, 2022, owns 99.9% of Great Ajax II REIT Inc., which owns Great Ajax II Depositor LLC, which then acts as the depositor of mortgage loans into securitization trusts and holds subordinated securities issued by such trusts. Similarly, as of December 31, 2022, the Operating Partnership wholly owned Great Ajax III Depositor LLC, which was formed to act as the depositor into Ajax Mortgage Loan Trust 2021-E (2021-E), which is a real estate mortgage investment conduit (REMIC). The company has securitized mortgage loans through these securitization trusts and retained subordinated securities from the secured borrowings. These trusts are considered to be variable interest entities (VIEs), and it has determined that we are the primary beneficiary of the VIEs. In 2018, the company formed Gaea Real Estate Corp. (Gaea), as a wholly owned subsidiary of the Operating Partnership. The company elected to treat Gaea as a TRS under the Code for 2018, and the company elected to treat Gaea as a REIT under the Code in 2019 and thereafter. Also, during 2018, the company formed Gaea Real Estate Operating Partnership LP, a wholly owned subsidiary of Gaea, to hold investments in commercial real estate assets, and Gaea Real Estate Operating LLC, to act as its general partner. The company also formed Gaea Veterinary Holdings LLC, BFLD Holdings LLC, Gaea Commercial Properties LLC, Gaea Commercial Finance LLC and Gaea RE Holdings LLC as subsidiaries of Gaea Real Estate Operating Partnership. In 2019, the company formed DG Brooklyn Holdings LLC, also a subsidiary of Gaea Real Estate Operating Partnership LP, to hold investments in multi-family properties. Strategy The company’s strategy consists of constructing and owning a portfolio of residential RPLs and SBC loans at discounts to the unpaid principal balance (UPB) and significant discounts to underlying property values; expanding its acquisitions of RPLs, SBC loans, and limited acquisitions of NPLs through joint ventures; constructing concentrations of investments in geographic areas, cities and neighborhoods with certain demographic and economic trends and attributes; working, through its Servicer, to support the continued performance of RPLs; convert a portion of its NPLs to performing status; determine the optimal loss mitigation strategy on an asset-by-asset basis; and manage the process and timelines for converting NPLs to REO held-for-sale; when economically efficient, securitizing its RPL portfolio to create long-term, fixed rate, non-recourse financing, while retaining one or more tranches of any subordinated securities it may create; opportunistically mitigating its interest rate and prepayment risk, including, potentially, through the use of a variety of hedging instruments; and working through joint ventures with third party investors to acquire pools of mortgage loans and other mortgage related assets. The company’s strategy is adaptable to changing market environments, subject to compliance with the income and other tests, which allows us to continue to qualify and maintain its qualification as a REIT for the U.S. federal income tax purposes and to maintain its exclusion from regulation as an investment company under the Investment Company Act. The company seeks to build concentrations of loans and real properties in certain markets. These markets include, but are not limited to, Phoenix, Arizona; Los Angeles and San Diego, California; Miami, Ft. Lauderdale, West Palm Beach, Orlando and Tampa, Florida; Atlanta, Georgia; New York and New Jersey metropolitan area; Charlotte, North Carolina; Houston and Dallas, Texas; Portland, Oregon; and Maryland and Virginia near Washington, DC. In addition to its experienced servicing staff, its Servicer has contracted with local experts in areas where it services a significant number of loans that provide local area market intelligence, monitor properties and can manage rehabilitation projects for REO properties. Tax Status The company has elected to be taxed as a REIT under the Internal Revenue Code of 1986, as amended. As a result, the company is not subject to Federal or State income taxation at the corporate level to the extent it distributes annually approximately 90% of its REIT taxable income to its shareholders and satisfies certain other requirements. History Great Ajax Corp. was founded in 2014 as a Maryland corporation. The company was incorporated in 2014.