Angel Oak Mortgage REIT, Inc.
For the period ended Sep 30, 2025. Filed Nov 6, 2025.
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A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Sep 30, 2025 · Filed Nov 6, 2025
AOMN$24.21-0.3%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2025-06-30; filed 2025-08-06.
0001766478-25-000080
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2025-09-30; filed 2025-11-06.
0001766478-25-000099
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 255 previous paragraphs and 261 current paragraphs.
196 unchanged; 49 reworded; 15 added; 9 removed; 1 previous and 1 current paragraphs rearranged.
Tables are not compared: 27 previous and 29 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (15)
Current report
On October 1, 2025, the Company, the Operating Partnership, and our Manager entered into a new management agreement (the “New Management Agreement”) to supersede and replace in its entirety the Amended and Restated Management Agreement, dated as of May 1, 2024 (the “Management Agreement”). The New Management Agreement was entered into immediately following the closing on October 1, 2025 of the strategic transaction between Angel Oak Companies, an affiliate of the Manager, and Brookfield Asset Management Ltd. (“Brookfield”). The New Management Agreement is substantially and economically similar to the Management Agreement, with a revision to the reimbursement for the Company’s Chief Executive Officer, Sreeni Prabhu, and clarification of the considerations for which the Company may decline to renew the New Management Agreement on an annual basis.
Current report
In the third quarter of 2025, the macroeconomic environment was characterized by general resilience despite competing headwinds and tailwinds surrounding inflation, consumer spending, gross domestic product, and continued geopolitical tension. Many of the themes driving uncertainty from earlier in the year persisted in the third quarter of 2025, yet equity markets again finished with quarter over quarter growth compared to the end of the second quarter of 2025. Inflation ticked up from 2.7% to 3.0% from June 2025 to September 2025. Combined with a weakening labor market, the Federal Reserve Bank (“Fed”) elected to cut the federal funds rate at their September meeting by 25 basis points to 4.00% - 4.25%, representing the first cut since December 2024. This was followed by an additional 25 basis point cut in the Fed’s October meeting, bringing the current federal funds rate to 3.75% - 4.00%. The dovish approach was a welcome development for prospective homebuyers, as mortgage rates decreased in line with Fed rate expectations. Current projections are for two more interest rate cuts in 2025, though the recent government shutdown has cast uncertainty on the future rate path. Securitization markets, in particular, demonstrated resilience with robust activity and a continued tightening of execution spreads.
Current report
Net realized loss. Our net realized loss for the quarter ended September 30, 2025 was primarily due to realized losses associated with hedging activity, as well as a realized loss associated with the retained RMBS from our AOMT 2019-2 and AOMT 2019-4 securitizations, which were called and re-securitized into AOMT 2025-R1 in the third quarter. Note that the previous unrealized loss on these RMBS was greater than the realized loss, indicating an incrementally positive impact to book value.
Current report
Net unrealized gain. Our net unrealized gain for the quarter ended September 30, 2025 was primarily due to increases in valuations of our residential mortgage loans and residential mortgage loans in securitization trusts during the quarter.
Current report
In September 2025, the Company in conjunction with the Company’s affiliates exercised their call rights on the AOMT 2019-2 and AOMT 2019-4 securitizations and subsequently re-securitized the underlying loans in AOMT 2025-R1. This transaction resulted in $19.4 million of cash, which was used for new loan purchases and other accretive uses, and $7.3 million of non-performing loans that are classified as held for sale and recorded in other assets.
Current report
•Subsequent to the quarter ended September 30, 2025, on October 6, 2025, the Company and one of its subsidiaries entered into a $200.0 million repurchase facility with a global investment bank (“Global Investment Bank 4”) through the execution of a Master Repurchase Agreement and Securities Contract (the “Master Repurchase Agreement”). The amount expected to be advanced by Global Investment Bank 4 is generally in line with other similar agreements that the Company has entered into. Additionally, the rates, terms, events of default, and remedies for such events of default contained within the Master Repurchase Agreement are generally in line with other similar agreements that the Company has entered into. The interest rate is equal to the sum of (1) a spread of 1.60%, and (2) Term SOFR. The Company is subject to various financial and other covenants, including those relating to (1) declines in tangible net worth; (2) a maximum ratio of indebtedness to tangible net worth; and (3) minimum liquidity. The Master Repurchase Agreement expires on October 6, 2027, unless terminated earlier pursuant to the terms of the Master Repurchase Agreement.
Current report
Nine Months Ended September 30, 2025 and 2024
Current report
Subsequent to the quarter ended September 30, 2025, on October 6, 2025, the Company and one of its subsidiaries entered into a $200.0 million repurchase facility with Global Investment Bank 4 through the execution of the Master Repurchase Agreement. The amount expected to be advanced by Global Investment Bank 4 is generally in line with other similar agreements that the Company has entered into. Additionally, the rates, terms, events of default, and remedies for such events of default contained within the Master Repurchase Agreement are generally in line with other similar agreements that the Company has entered into. The interest rate is equal to the sum of (1) a spread of 1.60%, and (2) Term SOFR. The Company is subject to various financial and other covenants, including those relating to (1) declines in tangible net worth; (2) a maximum ratio of indebtedness to tangible net worth; and (3) minimum liquidity. The Master Repurchase Agreement expires on October 6, 2027, unless terminated earlier pursuant to the terms of the Master Repurchase Agreement.
Current report
Subsequent to the quarter ended September 30, 2025, on October 10, 2025, the Company amended the Pricing Side Letter of its loan financing facility with Global Investment Bank 2. The interest rate pricing spread was updated from a range of 1.75% to 3.35% to a range of 1.65% to 2.40% , based on collateral type, loan status, dwell time and other factors.
Current report
The Company’s Senior Unsecured Notes consist of $42.5 million principal amount of our 2030 Notes and $50.0 million principal amount of our 2029 Notes. The 2030 Notes were issued in May 2025 in a public offering for net proceeds of approximately $40.6 million and the 2029 Notes were issued in July 2024 in a public offering for net proceeds of approximately $47.5 million. The below table provides a summary of the Senior Unsecured Notes as of September 30, 2025 ($ in thousands).
Current report
(2)The Company has the option to redeem the Senior Unsecured Notes earlier than the maturity date.
Current report
(4)The 2030 Notes bear interest at a rate equal to 9.750% per year, payable in cash quarterly in arrears on March 1, June 1, September 1, and December 1 of each year, beginning on September 1, 2025. The 2029 Notes bear interest at a rate equal to 9.500% per year, payable in cash quarterly in arrears on January 30, April 30, July 30 and October 30 of each year.
Current report
The below table details the total interest expense incurred on the Senior Unsecured Notes during the three and nine months ended September 30, 2025 and September 30, 2024.
Current report
At September 30, 2025 and September 30, 2024, the accrued interest payable on the Senior Unsecured Notes was $1.2 million and $0.9 million, respectively.
Current report
At September 30, 2025 and September 30, 2024, the unamortized deferred debt issuance cost was $1.3 million and $0.9 million, respectively. The unamortized debt issuance costs will be amortized until maturity.
Removed paragraphs (9)
Previous report
Angel Oak Companies has advised us that they have agreed to enter into a strategic transaction (the “Strategic Transaction”) with Brookfield Asset Management Ltd. (“Brookfield”). Angel Oak Companies has advised us that the Strategic Transaction would result in the current beneficial owners of Angel Oak Companies selling approximately 51% of the outstanding beneficial ownership of Angel Oak Companies, and indirectly our Manager, to Brookfield at closing. Angel Oak Companies has advised us that following the closing of the Strategic Transaction, the existing Angel Oak Companies management team will continue to independently manage the day-to-day business of Angel Oak Companies and our Manager, and will control the board of directors of Angel Oak Companies. Angel Oak Companies has advised us that the Strategic Transaction is not intended to result in any material changes to the investment objectives or strategies of the Company, nor to adjust the investment decision-making processes or portfolio management with respect to the Company. Angel Oak Companies has advised us that the personnel, officers and managers of our Manager are expected to remain the same. Angel Oak Companies has advised us that, as part of the Strategic Transaction, Brookfield will have a right to acquire additional beneficial ownership in Angel Oak Companies beginning in 2027, which over time could result in Brookfield taking control of the board of directors of Angel Oak Companies. Angel Oak Companies has advised us that the Strategic Transaction is expected to close in the third quarter of 2025, subject to the satisfaction of customary closing conditions, including the receipt of certain regulatory clearances and required client consents. Under the Management Agreement, the Strategic Transaction would constitute an assignment of the Management Agreement pursuant to which the Management Agreement automatically terminates without payment of a termination fee unless the assignment is consented to in writing by the Company with the consent of a majority of the Company’s independent directors. For a discussion of certain risks related to our relationship with our Manager, see the information under Item 1A. “Risk Factors—Risks Related to Our Relationship with Our Manager and its Affiliates” in the Annual Report on Form 10-K.
Previous report
The second quarter of 2025 began with “Liberation Day”, on which significant tariff increases were announced on goods imported into the United States. This announcement sparked sharp selloffs in both equity and fixed income markets, as the potential increases in the costs of many goods drove renewed concern around increases in inflation. Temporary pauses to the tariff increases were announced shortly after Liberation Day, and the extent to which the originally announced tariffs will be enacted remains uncertain. The selloff associated with the original Liberation Day announcement moderated throughout the remainder of the second quarter, and equity markets finished the quarter in positive territory as of June 30, 2025 compared to March 31, 2025. Despite the uncertainty, securitization markets remained stable and constructive throughout the quarter. Inflation slowed in April and May 2025 before increasing from 2.4% in May to 2.7% in June, likely reflecting the impact of announced tariffs. The Federal Reserve Bank (“Fed”) maintained its wait-and-see approach and held interest rates steady at 4.25 - 4.50% through the second quarter of 2025. Current projections are for the Fed to begin cutting interest rates in 2025, though the timing and extent remains uncertain.
Previous report
Notes offering
Previous report
In May 2025, we closed an underwritten public offering and sale of, and issued, $42.5 million in aggregate principal amount of our 9.750% Senior Notes due 2030 (the “2030 Notes”). The 2030 Notes bear interest at a rate of 9.750% per annum, payable quarterly in arrears on March 1, June 1, September 1, and December 1 of each year, beginning on September 1, 2025. The 2030 Notes will mature on June 1, 2030, unless earlier redeemed or repurchased by us, and are held at amortized cost. After deducting the underwriting discount and other debt issuance costs, we received net proceeds of approximately $40.6 million. We used the majority of the net proceeds from the offering for general corporate purposes, which included the acquisition of non-QM loans and other target assets in a manner consistent with our strategy and investment guidelines.
Previous report
Net realized loss. Our net realized loss for the quarter ended June 30, 2025 was primarily due to realized losses associated with the write-off of unamortized premium of loans that paid off in our residential loans in securitization trust portfolio and in loans underlying our RMBS portfolio.
Previous report
Net unrealized loss. Our net unrealized loss for the quarter ended June 30, 2025 was primarily due to the reversal of prior unrealized gains on residential loans that were contributed to securitizations during the quarter.
Previous report
For the three months ended June 30, 2025 and 2024, we incurred $1.9 million and $1.4 million of securitization costs, respectively. The expense in the three months ended June 30, 2025 is due to expenses associated with the AOMT 2025-4 and AOMT 2025-6 securitizations, and the expense in the first three months of 2024 was due to expenses associated with the AOMT 2024-4 and AOMT 2024-6 securitizations.
Previous report
Six Months Ended June 30, 2025 and 2024
Previous report
Securitization Costs
Reworded paragraphs (49)
Previous wording
•the effects of adverse conditions or developments in the financial markets and the economy upon our ability to acquire target assets such as non-qualified residential mortgage (“non-QM”) loans, particularly those sourced from Angel Oak’s proprietary mortgage lending platform, Angel Oak Mortgage Lending;
Current wording
•the effects of adverse conditions or developments in the financial markets and the economy, including as a result of the current U.S. government shutdown, upon our ability to acquire target assets such as non-qualified residential mortgage (“non-QM”) loans, particularly those sourced from Angel Oak’s proprietary mortgage lending platform, Angel Oak Mortgage Lending;
Previous wording
Angel Oak Mortgage REIT, Inc. is a real estate finance company focused on acquiring and investing in first lien non-QM loans and other mortgage-related assets in the U.S. mortgage market. Our strategy is to make credit-sensitive investments primarily in newly-originated first lien non-QM loans that are primarily made to higher-quality non-QM loan borrowers and substantially sourced from Angel Oak’s proprietary mortgage lending platform, Angel Oak Mortgage Lending, which currently operates primarily through a wholesale channel and has a national origination footprint. We also may invest in other residential mortgage loans, RMBS, and other mortgage-related assets, which, collectively with non-QM loans, we refer to as our target assets. Further, we also may identify and acquire our target assets through the secondary market when market conditions and asset prices are conducive to making attractive purchases. Our objective is to generate attractive risk-adjusted returns for our stockholders, through cash distributions and capital appreciation, across interest rate and credit cycles.
Current wording
Angel Oak Mortgage REIT, Inc. is a real estate finance company focused on acquiring and investing in first lien non-QM loans and other mortgage-related assets in the U.S. mortgage market. Our strategy is to make credit-sensitive investments primarily in newly originated non-QM loans that are primarily made to higher quality borrowers and sourced from Angel Oak’s proprietary mortgage lending platform, Angel Oak Mortgage Lending, which currently operates primarily through a wholesale channel and has a national origination footprint, and other originators. We also may invest in other residential mortgage loans, RMBS, and other mortgage-related assets, which, collectively with non-QM loans, we refer to as our target assets. Further, we also may identify and acquire our target assets through the secondary market when market conditions and asset prices are conducive to making attractive purchases. Our objective is to generate attractive risk-adjusted returns for our stockholders, through cash distributions and capital appreciation, across interest rate and credit cycles.
Previous wording
Similar to the moderation in equity markets following the initial reaction to Liberation Day, Treasury yields experienced decreases across two and five-year terms, with a slight increase to the ten-year yield in the second quarter of 2025. The two-year Treasury yield decreased by approximately 17 basis points since the end of the first quarter of 2025 to 3.72%, the five-year Treasury yield decreased by approximately 15 basis points since the end of first quarter of 2025 to 3.81%, and the ten-year Treasury yield increased by approximately 2 basis points since the end of first quarter of 2025 to 4.23%. Each of the two, five, and ten-year Treasury yields finished the second quarter well below the highest rate observed over the course of the quarter, which occurred in mid-May across all three terms.
Current wording
As expected, Treasury yields decreased across two, five, and ten-year terms in the third quarter of 2025. The two-year Treasury yield decreased by approximately 11 basis points since the end of the second quarter of 2025 to 3.62% at the end of the third quarter of 2025, the five-year Treasury yield decreased by approximately 6 basis points since the end of second quarter of 2025 to 3.75% at the end of the third quarter of 2025, and the ten-year Treasury yield decreased by approximately 8 basis points since the end of second quarter of 2025 to 4.15% at the end of the third quarter of 2025.
Previous wording
30 year fixed residential conforming mortgage rates increased by 12 basis points over the course of the second quarter to 6.77% as of the end of the second quarter from 6.65% as of the end of the first quarter of 2025. These rates, alongside federal funds rate and Treasury yields, are key benchmarks for the valuation of our portfolio, and an increase is generally expected to drive a corresponding negative impact to our newly originated asset pricing, as we observed in the second quarter of 2025. As such, we observed an approximately 53 basis point decrease versus the first quarter of 2025 in the weighted average price of our residential whole loans portfolio excluding home equity lines of credit (“HELOCs”). This decrease was offset by a 136 basis point increase in the second quarter in the weighted average price of our loans in securitization trusts portfolio, which is substantially composed of loans originated in recent years at lower interest rates, versus the prior quarter. We expect to continue to purchase newly originated loans and HELOCs, which should continue to support overall portfolio valuations and securitization execution going forward.
Current wording
30 year fixed residential conforming mortgage rates decreased by 47 basis points over the course of the third quarter of 2025 to 6.30% as of the end of the third quarter of 2025 from 6.77% as of the end of the second quarter of 2025. These rates, alongside federal funds rate and Treasury yields, are key benchmarks for the valuation of our portfolio, and a decrease is generally expected to drive a corresponding positive impact to our newly originated asset pricing, consistent with what we observed in the third quarter of 2025. We observed an approximately 63 basis point increase through the end of the third quarter of 2025 versus the second quarter of 2025 in the weighted average price of our residential whole loans portfolio, inclusive of home equity lines of credit (“HELOCs”). This increase in valuation was accompanied by a 78 basis point increase in the third quarter in the weighted average price of our loans in securitization trusts portfolio versus the prior quarter. We expect to continue to purchase newly originated loans and HELOCs, which should continue to support overall portfolio valuations and securitization execution going forward.
Previous wording
Net Interest Margin (“NIM”). We generated a 5% increase in net interest income in the second quarter of 2025 as compared to the second quarter of 2024, supported by the continued acquisition of accretive assets. Compared to the second quarter of 2024, interest income grew by $9.2 million and interest expense grew by $8.7 million, resulting in net interest income growth of $0.5 million in the second quarter of 2025. Interest income grew due to the continued acquisition and securitization of current market non-QM loans. The addition of our 2029 Notes and 2030 Notes issued in July 2024 and May 2025, respectively, were key components of the increase to interest expense, and, although there can be no assurances, we expect the deployment of new capital from our 2030 Notes issuance to drive further net interest income expansion in future quarters.
Current wording
Net Interest Margin (“NIM”). We generated a 12.9% increase in net interest income in the third quarter of 2025 as compared to the third quarter of 2024, supported by the continued acquisition of accretive assets and reductions in financing facility pricing. Compared to the third quarter of 2024, interest income grew by $9.2 million and interest expense grew by $8.1 million, resulting in net interest income growth of $1.2 million in the third quarter of 2025. Interest income grew due to the continued acquisition and securitization of current market non-QM loans. Compared to the second quarter of 2025, net interest income grew by 2.4%, demonstrating that earnings from assets purchased with the proceeds of our May 2025 offering of $42.5 million in aggregate principal amount of our 9.750% Senior Notes due 2030 (the “2030 Notes”) outpaced the incremental interest expense and produced a positive return.
Previous wording
During the quarter ended June 30, 2025, we purchased $146.6 million of newly-originated, current market coupon non-QM residential mortgage loans, second lien mortgage loans (residential mortgage loans that are subordinate to the primary or first lien mortgage loans on a residential property, or “Closed-End Seconds”), and HELOCs, with a weighted average coupon of 8.68%, weighted average combined loan-to-value ratio (“CLTV”) of 68.4% and weighted average credit score of 757.
Current wording
During the quarter ended September 30, 2025, we purchased $237.6 million of newly-originated, current market coupon non-QM residential mortgage loans, second lien mortgage loans (residential mortgage loans that are subordinate to the primary or first lien mortgage loans on a residential property, or “Closed-End Seconds”), and HELOCs, with a weighted average coupon of 7.74%, weighted average combined loan-to-value ratio (“CLTV”) of 69.4% and weighted average non-zero credit score of 759.
Previous wording
In April 2025, we issued AOMT 2025-4, a $284.3 million scheduled unpaid principal balance securitization backed by a pool of residential mortgage loans. We issued AOMT 2025-4 as the sole participant in the securitization. We used the proceeds to repay outstanding debt of approximately $242.4 million, and the $24.7 million of cash released was used for new loan purchases and operational purposes.
Current wording
Subsequent to the end of the third quarter, in October 2025, we issued AOMT 2025-10, an approximately $274.3 million scheduled unpaid principal balance securitization backed by a pool of residential mortgage loans. We issued AOMT 2025-10 as the sole contributor in the securitization. We used the proceeds to repay outstanding debt of approximately $237.4 million, and the $22.1 million of cash released is planned to be used for new loan purchases and operational purposes.
Previous wording
We continuously evaluate our lender base and may enter into new agreements and / or exit agreements as we deem prudent, in accordance with our core financial strategy of purchasing whole loans and financing them until securitized. See “Liquidity and Capital
Current wording
We continuously evaluate our lender base and may enter into new agreements and / or exit agreements as we deem prudent, in accordance with our core financial strategy of purchasing whole loans and financing them until securitized. See “Liquidity and Capital Resources” below for a full description of our financing arrangements. Our total borrowing capacity was $1.1 billion as of September 30, 2025; Highlights of whole loan financing facilities activity over thethird quarter of 2025 are as follows:
Previous wording
We also use Distributable Earnings to determine the incentive fee, if any, payable to our Manager pursuant to the management agreement that we and the Operating Partnership entered into with our Manager upon the completion of our initial public offering of common stock (“IPO”) on June 21, 2021 and amended and restated on May 1, 2024 (as amended and restated, the “Management Agreement”). For information on the fees that are payable to our Manager under the Management Agreement, see “Note 10 –Related Party Transactions” in our unaudited condensed consolidated financial statements included in this report.
Current wording
We also use Distributable Earnings to determine the incentive fee, if any, payable to our Manager pursuant to the Management Agreement. For information on the fees that are payable to our Manager under the Management Agreement, see “Note 10 –Related Party Transactions” in our unaudited condensed consolidated financial statements included in this report.
Previous wording
Distributable Earnings were a gain of $2.6 million and a loss of $2.3 million for the three months ended June 30, 2025 and 2024, respectively. The primary drivers of the difference of Distributable Earnings as compared to GAAP net income in the quarters ended June 30, 2025 and June 30, 2024 are adjustments to remove unrealized losses on residential loans and adjustments to remove unrealized gains on residential loans in securitization trusts and non-recourse securitization obligation, respectively. For the six months ended June 30, 2025 and June 30, 2024, the primary drivers of the difference between Distributable Earnings and GAAP net income were adjustments to remove unrealized gains on residential loans in securitization trusts and non-recourse securitization obligation and adjustments to remove unrealized gains on residential loans, respectively.
Current wording
Distributable Earnings were a gain of $0.5 million and a loss of $3.4 million for the three months ended September 30, 2025 and 2024, respectively. The primary drivers of the difference of Distributable Earnings as compared to GAAP net income for both of the quarters ended September 30, 2025 and September 30, 2024 were adjustments to remove unrealized gains on residential loans and on residential loans in securitization trusts and non-recourse securitization obligation. Distributable Earnings were a gain of $7.3 million and a loss of $2.8 million for the nine months ended September 30, 2025 and 2024, respectively. For the nine months ended September 30, 2025 and September 30, 2024, the primary drivers of the difference between Distributable Earnings and GAAP net income for both periods were adjustments to remove unrealized gains on residential loans in securitization trusts and non-recourse securitization obligation and unrealized gains on residential loans.
Previous wording
The table below sets forth a reconciliation of net income (loss) allocable to common stockholders, calculated in accordance with GAAP, to Distributable Earnings for the three and six months ended June 30, 2025 and 2024:
Current wording
The table below sets forth a reconciliation of net income (loss) allocable to common stockholders, calculated in accordance with GAAP, to Distributable Earnings for the three and nine months ended September 30, 2025 and 2024:
Previous wording
Distributable Earnings Return on Average Equity is a non-GAAP measure and is defined as annual or annualized Distributable Earnings divided by average total stockholders’ equity. We believe that the presentation of Distributable Earnings Return on Average Equity provides investors with a useful measure to facilitate comparisons of financial performance among our REIT peers, but has important limitations. Additionally, we believe Distributable Earnings Return on Average Equity provides investors with additional detail on the Distributable Earnings generated by our invested equity capital. We believe Distributable Earnings Return on Average Equity as described above helps evaluate our financial performance without the impact of certain transactions but is of limited usefulness as an analytical tool. Therefore, Distributable Earnings Return on Average Equity should not be viewed in isolation and is not a substitute for net income computed in accordance with GAAP. Our methodology for calculating Distributable Earnings Return on Average Equity may differ from the methodologies employed by other REITs to calculate the same or similar supplemental performance measures, and as a result, our Distributable Earnings Return on Average Equity may not be comparable to similar measures presented by other REITs. Set forth below is our computation of Distributable Earnings Return on Average Equity for the three and six months ended June 30, 2025 and 2024:
Current wording
Distributable Earnings Return on Average Equity is a non-GAAP measure and is defined as annual or annualized Distributable Earnings divided by average total stockholders’ equity. We believe that the presentation of Distributable Earnings Return on Average Equity provides investors with a useful measure to facilitate comparisons of financial performance among our REIT peers, but has important limitations. Additionally, we believe Distributable Earnings Return on Average Equity provides investors with additional detail on the Distributable Earnings generated by our invested equity capital. We believe Distributable Earnings Return on Average Equity as described above helps evaluate our financial performance without the impact of certain transactions but is of limited usefulness as an analytical tool. Therefore, Distributable Earnings Return on Average Equity should not be viewed in isolation and is not a substitute for net income computed in accordance with GAAP. Our methodology for calculating Distributable Earnings Return on Average Equity may differ from the methodologies employed by other REITs to calculate the same or similar supplemental performance measures, and as a result, our Distributable Earnings Return on Average Equity may not be comparable to similar measures presented by other REITs. Set forth below is our computation of Distributable Earnings Return on Average Equity for the three and nine months ended September 30, 2025 and 2024:
Previous wording
We generated $9.2 million greater interest income for the quarter ended June 30, 2025 than in the comparable period for 2024, driven by increases in both the amount and yields of our target assets. Interest expense increased by $8.7 million for the quarter ended June 30, 2025 compared to the comparable period for 2024, driven by increases in our total borrowings and our 2029 Notes and 2030 Notes issuances, both of which occurred after the quarter ended June 30, 2024. Overall, the increase in our interest income outpaced the increase in interest expense and drove a 5.0%, or $0.5 million, increase in net interest income for the quarter ended June 30, 2025 than in the comparable period for 2024.
Current wording
We generated $9.2 million greater interest income for the quarter ended September 30, 2025 than in the comparable period for 2024, driven by increases in both the amount and yields of our target assets. Interest expense increased by $8.1 million for the quarter ended September 30, 2025 compared to the comparable period for 2024, driven by increases in our total borrowings and our 2030 Notes issuance. Overall, the increase in our interest income outpaced the increase in interest expense and drove a 12.9%, or $1.2 million, increase in net interest income for the quarter ended September 30, 2025 than in the comparable period of 2024.
Previous wording
For the three months ended June 30, 2025 and 2024, total realized and unrealized gains and (losses), net resulted in net losses of $4.1 million and $4.1 million, respectively. During the three months ended June 30, 2025, realized and unrealized losses on securitization, net of unrealized gain (loss) on non-recourse securitization obligation, realized losses on interest rate futures, and realized and unrealized losses on residential mortgage loans were the primary drivers of the overall loss to our portfolio. During the three months ended June 30, 2024, losses on securitization, net of unrealized gain (loss) on non-recourse securitization obligation were the key drivers of the overall loss.
Current wording
For the three months ended September 30, 2025 and 2024, total realized and unrealized gains and (losses), net resulted in net gains of $4.7 million and $28.8 million, respectively. During the three months ended September 30, 2025, realized and unrealized gains on residential mortgage loans, and realized and unrealized gain (loss) on securitization, net of unrealized gain (loss) on non-recourse securitization obligation were the primary drivers of the overall gain to our portfolio. During the three months ended September 30, 2024, realized gains losses on securitization, net of unrealized gain (loss) on non-recourse securitization obligation was the key drivers of the overall gain.
Previous wording
For the three months ended June 30, 2025 and 2024, our operating expenses were $1.3 million and $1.7 million, respectively. Our operating expenses decreased compared to the comparative period due to a decrease in fees associated with the acquisition of whole loans in our whole loans portfolio.
Current wording
For the three months ended September 30, 2025 and 2024, our operating expenses were $1.1 million and $1.5 million, respectively. Our operating expenses decreased compared to the comparative period due to a decrease in expenses associated with the acquisition of whole loans in our whole loans portfolio.
Previous wording
For the three months ended June 30, 2025 and 2024, our operating expenses incurred with affiliate were $0.5 million and $0.5 million, respectively. These expenses, which are substantially comprised of payroll reimbursements to our Manager, were flat in the three months ended June 30, 2025 compared to the same period of 2024.
Current wording
For the three months ended September 30, 2025 and 2024, our operating expenses incurred with affiliate were $0.5 million and $0.5 million, respectively. These expenses, which are substantially comprised of payroll reimbursements to our Manager, were consistent with the three months ended September 30, 2025 compared to the same period of 2024.
Previous wording
For the three months ended June 30, 2025 and 2024, our stock compensation expense was $0.3 million and $0.6 million, respectively. Our stock compensation expense decreased for the three months ended June 30, 2025 due primarily to the vesting of stock awards granted at our IPO.
Current wording
For the three months ended September 30, 2025 and 2024, our stock compensation expense was $0.4 million and $0.6 million, respectively. Our stock compensation expense decreased for the three months ended September 30, 2025 due primarily to the vesting of stock awards granted at our IPO.
Previous wording
For the three months ended June 30, 2025 and 2024, our management fee incurred with affiliate was $1.1 million and $1.3 million, respectively. The decrease is due to the decrease in our average Equity (as defined in the Management Agreement) for the three months ended June 30, 2025 as compared to the same period in 2024. The calculation of Equity for the purposes of the Management Agreement includes the addition or subtraction of Distributable Earnings, which is the primary departure from the calculation of equity in accordance with GAAP, which has caused Equity (as defined in the Management Agreement) to decrease.
Current wording
For the three months ended September 30, 2025 and 2024, our management fee incurred with affiliate was $1.2 million and $1.2 million, respectively. Minor movements are attributable to changes in our average Equity (as defined in the Management Agreement) for the three months ended September 30, 2025 as compared to the same period in 2024. The calculation of Equity for the purposes of the Management Agreement includes the addition or subtraction of Distributable Earnings, which is the primary departure from the calculation of equity in accordance with GAAP.
Previous wording
The following table sets forth a summary of our results of operations for the six months ended June 30, 2025 and 2024:
Current wording
The following table sets forth a summary of our results of operations for thenine months ended September 30, 2025 and 2024:
Previous wording
The following table sets forth the components of net interest income for thesix months ended June 30, 2025 and 2024:
Current wording
The following table sets forth the components of net interest income for thenine months ended September 30, 2025 and 2024:
Previous wording
Net interest income for thesix months ended June 30, 2025 and 2024 was $20.0 million and $18.0 million, respectively. Net interest income increased in the six months ended June 30, 2025 as compared to the same period in 2024, primarily due to higher interest income generated by increase balances in our residential mortgage loans in securitization trusts portfolio. Similarly, the increase in interest expense was also driven by the increased balance of our non-recourse securitization obligation, collateralized by residential mortgage loans portfolio during the six months ended June 30, 2025. The net interest income associated with our residential mortgage loans in securitization trusts portfolio and non-recourse securitization obligation, collateralized by residential mortgage loans portfolio was $13.5 million in the six months ended June 30, 2025 as compared to $9.4 million in the comparable period of 2024.
Current wording
Net interest income for thenine months ended September 30, 2025 and 2024 was $30.2 million and $27.1 million, respectively. Net interest income increased in thenine months ended September 30, 2025 as compared to the same period in 2024, primarily due to higher interest income generated by increase balances in our residential mortgage loans in securitization trusts portfolio. Similarly, the increase in interest expense was also driven by the increased balance of our non-recourse securitization obligation, collateralized by residential mortgage loans portfolio during thenine months ended September 30, 2025. The net interest income associated with our residential mortgage loans in securitization trusts portfolio and non-recourse securitization obligation, collateralized by residential mortgage loans portfolio was $20.4 million in thenine months ended September 30, 2025 as compared to $14.2 million in the comparable period of 2024.
Previous wording
The components of total realized and unrealized gains (losses), net for thesix months ended June 30, 2025 and 2024 are set forth as follows:
Current wording
The components of total realized and unrealized gains (losses), net for thenine months ended September 30, 2025 and 2024 are set forth as follows:
Previous wording
For thesix months ended June 30, 2025 and 2024, total realized and unrealized gains (losses), net resulted in a net gains of $9.4 million and $5.2 million, respectively. During thesix months ended June 30, 2025, gains on securitization, net of non-recourse securitization obligation, partially offset by losses on TBAs, were the primary drivers of the net gain. In thesix months ended June 30, 2024, the net realized and unrealized gain was primarily due to gains on TBAs, interest rate futures, and residential mortgage loans offset by losses on whole pool agency RMBS.
Current wording
For thenine months ended September 30, 2025 and 2024, total realized and unrealized gains (losses), net resulted in a net gains of $14.1 million and $34.0 million, respectively. During thenine months ended September 30, 2025, realized and unrealized gains on securitization, net of unrealized gain (loss) on non-recourse securitization obligation, partially offset by realized losses on RMBS, were the primary drivers of the net gain. In thenine months ended September 30, 2024, the net realized and unrealized gain was primarily due to gains on securitization, net of unrealized gain (loss) on non-recourse securitization obligation, and realized and unrealized gains on residential mortgage loans.
Previous wording
For thesix months ended June 30, 2025 and 2024, our operating expenses were $2.5 million and $3.7 million, respectively. Our operating expenses decreased during the six months ended June 30, 2025 as compared to the comparative period due to continued cost savings actions such as in-sourcing of key accounting functions, vendor contract negotiations, and a decrease in servicing fees associated with servicing our whole loan portfolio.
Current wording
For thenine months ended September 30, 2025 and 2024, our operating expenses were $3.7 million and $5.3 million, respectively. Our operating expenses decreased during thenine months ended September 30, 2025 as compared to the comparative period due to continued cost savings actions such as in-sourcing of key accounting functions, vendor contract negotiations, and a decrease in servicing fees associated with servicing our whole loan portfolio.
Previous wording
For thesix months ended June 30, 2025 and 2024, our operating expenses incurred with affiliate were $0.9 million and $1.0 million, respectively. These expenses, which are substantially comprised of payroll reimbursements to our Manager, decreased versus the comparative period due to achieved resource efficiencies.
Current wording
For thenine months ended September 30, 2025 and 2024, our operating expenses incurred with affiliate were $1.4 million and $1.4 million, respectively. These expenses, which are substantially comprised of payroll reimbursements to our Manager, decreased slightly versus the comparative period due to achieved resource efficiencies.
Previous wording
For thesix months ended June 30, 2025 and 2024 our stock compensation expense was $0.5 million and $1.3 million, respectively. Stock compensation expense decreased for thesix months ended June 30, 2025 due primarily to the vesting of stock awards granted at our IPO.
Current wording
For thenine months ended September 30, 2025 and 2024 our stock compensation expense was $0.9 million and $1.9 million, respectively. Stock compensation expense decreased for thenine months ended September 30, 2025 due primarily to the vesting of stock awards granted at our IPO.
Previous wording
Securitization costs of $1.9 million were incurred for thesix months ended June 30, 2025 in connection with the AOMT 2025-4 and AOMT 2025-6 securitizations. There were $1.6 million of securitization costs incurred for the comparable period in 2024, representing costs incurred in connection with the AOMT 2024-3, AOMT 2024-4, and AOMT 2024-6.
Current wording
Securitization costs of $1.9 million were incurred for thenine months ended September 30, 2025 in connection with the AOMT 2025-4 and AOMT 2025-6 securitizations. There were $1.6 million of securitization costs incurred for the comparable period in 2024, representing costs incurred in connection with the AOMT 2024-3, AOMT 2024-4, and AOMT 2024-6 securitizations.
Previous wording
For thesix months ended June 30, 2025 and 2024, our management fee incurred with affiliate was $2.3 million and $2.6 million, respectively. The decrease is due to the decrease in our average Equity as defined in the Management Agreement for the six months ended June 30, 2025 as compared to the same period in 2024. The calculation of Equity for the purposes of the Management Agreement includes the addition or subtraction of Distributable Earnings, which is the primary departure from the calculation of equity in accordance with GAAP.
Current wording
For thenine months ended September 30, 2025 and 2024, our management fee incurred with affiliate was $3.5 million and $3.8 million, respectively. The decrease is due to the decrease in our average Equity as defined in the Management Agreement for thenine months ended September 30, 2025 as compared to the same period in 2024. The calculation of Equity for the purposes of the Management Agreement includes the addition or subtraction of Distributable Earnings, which is the primary departure from the calculation of equity in accordance with GAAP.
Previous wording
(3) Other assets and liabilities presented is calculated as a net liability substantially comprised of $254.2 million due to broker for our quarter-end purchase of certain Freddie Mac and Fannie Mae-issued whole pool agency residential mortgage-backed securities (“Whole Pool Agency RMBS”), and excluding the portion of “other assets” which includes our investment in a Majority-Owned Affiliate, which is considered a target asset.
Current wording
(3) Other assets and liabilities presented is calculated as a net liability substantially comprised of $153.8 million due to broker for our quarter-end purchase of certain Freddie Mac and Fannie Mae-issued whole pool agency residential mortgage-backed securities (“Whole Pool Agency RMBS”), and excluding the portion of “other assets” which includes our investment in a Majority-Owned Affiliate, which is considered a target asset.
Previous wording
(2) “Target assets” as defined by us excludes U.S. Treasury securities, and includes our investment in a Majority-Owned Affiliates.
Current wording
(2) “Target assets” as defined by us excludes U.S. Treasury securities, and includes our investment in Majority-Owned Affiliates.
Previous wording
(2)The whole pool RMBS presented as of June 30, 2025 were purchased from a broker to whom the Company owed approximately $254.2 million, payable upon the settlement date of the trade. See Note 6 —Due to Brokerin our unaudited condensed consolidated financial statements included in this report.
Current wording
(2)The whole pool RMBS presented as of September 30, 2025 were purchased from a broker to whom the Company owed approximately $153.8 million, payable upon the settlement date of the trade. See Note 6 —Due to Brokerin our unaudited condensed consolidated financial statements included in this report.
Previous wording
The following table sets forth information with respect to our RMBS ending balances, at fair value, as of June 30, 2025:
Current wording
The following table sets forth information with respect to our RMBS ending balances, at fair value, for the quarter ended September 30, 2025:
Previous wording
Liquidity is a measurement of our ability to meet potential cash requirements, including ongoing commitments to repay borrowings, fund our investments and operating costs, make distributions to our stockholders, and satisfy other general business needs. Our financing sources currently include payments of principal and interest we receive on our investment portfolio, unused borrowing capacity under our in‑place loan financing lines and repurchase facilities, securitizations of our whole loans, and our ATM Program (as defined below). Additionally, on July 25, 2024, we closed an underwritten public offering and sale of, and issued, $50 million in aggregate principal amount of our 2029 Notes. We have deployed the majority of the net proceeds from the offering of our 2029 Notes for general corporate purposes, which included the acquisition of non-QM loans and other target assets substantially sourced from our affiliated proprietary mortgage lending platform and other target assets through the secondary market in a manner consistent with our strategy and investment guidelines. Additionally, we used the net proceeds from the offering of our 2029 Notes to repurchase 1,707,922 shares of our common stock owned by Xylem Finance LLC, an affiliate of Davidson Kempner Capital Management LP, for an aggregate repurchase price of approximately $20.0 million. Furthermore, in May 2025, we closed an underwritten public offering and sale of, and issued, $42.5 million in aggregate principal amount of our 2030 Notes. We used the majority of the net proceeds from the offering of our 2030 Notes for general corporate purposes, which included the acquisition of non-QM loans and other target assets in a manner consistent with our strategy and investment guidelines. Our financing sources historically have included the foregoing, as well as capital contributions from our investors prior to our IPO, and the proceeds from our IPO and concurrent private placement (which capital has all been deployed). Going forward, we may also utilize other types of borrowings, including bank credit facilities and warehouse lines of credit, among others. We may also seek to raise additional capital through public or private offerings of equity, equity-related, or debt securities, depending upon market conditions. The use of any particular source of capital and funds will depend on market conditions, availability of these sources, and the investment opportunities available to us.
Current wording
Liquidity is a measurement of our ability to meet potential cash requirements, including ongoing commitments to repay borrowings, fund our investments and operating costs, make distributions to our stockholders, and satisfy other general business needs. Our financing sources currently include payments of principal and interest we receive on our investment portfolio, unused borrowing capacity under our in‑place loan financing lines and repurchase facilities, securitizations of our whole loans, and our ATM Program (as defined below). Additionally, on July 25, 2024, we closed an underwritten public offering and sale of, and issued, $50 million in aggregate principal amount of our 9.500% Senior Notes due July 2029 (the “2029 Notes” and, together with the 2030 Notes, the “Senior Unsecured Notes”). We have deployed the majority of the net proceeds from the offering of our 2029 Notes for general corporate purposes, which included the acquisition of non-QM loans and other target assets substantially sourced from our affiliated proprietary mortgage lending platform and other target assets through the secondary market in a manner consistent with our strategy and investment guidelines. Additionally, we used the net proceeds from the offering of our 2029 Notes to repurchase 1,707,922 shares of our common stock owned by Xylem Finance LLC, an affiliate of Davidson Kempner Capital Management LP, for an aggregate repurchase price of approximately $20.0 million. Furthermore, in May 2025, we closed an underwritten public offering and sale of, and issued, $42.5 million in aggregate principal amount of our 2030 Notes. We used the majority of the net proceeds from the offering of our 2030 Notes for general corporate purposes, which included the acquisition of non-QM loans and other target assets in a manner consistent with our strategy and investment guidelines. Our financing sources historically have included the foregoing, as well as capital contributions from our investors prior to our IPO, and the proceeds from our IPO and concurrent private placement (which capital has all been deployed). Going forward, we may also utilize other types of borrowings, including bank credit facilities and warehouse lines of credit, among others. We may also seek to raise additional capital through public or private offerings of equity, equity-related, or debt securities, depending upon market conditions. The use of any particular source of capital and funds will depend on market conditions, availability of these sources, and the investment opportunities available to us.
Previous wording
As of June 30, 2025, we were a party to three warehouse loan financing lines, which permitted borrowings in an aggregate amount of up to $1.1 billion. During the quarter ended June 30, 2025, we renewed our loan financing facility with Multinational Bank 1 in accordance with the mechanism for six-month renewal periods. Borrowings under warehouse loan financing lines (in general, each a “loan financing facility”) may be used to purchase whole loans for securitization or loans purchased for long‑term investment purposes.
Current wording
As of September 30, 2025, we were a party to three warehouse loan financing lines, which permitted borrowings in an aggregate amount of up to $1.1 billion.
Previous wording
The principal amount paid by Global Investment Bank 2 for each mortgage loan is based on a percentage of the market value, cost‑basis value, or unpaid principal balance of the mortgage loan (depending on the type of loan and certain other factors and subject to certain other adjustments). Pursuant to the agreement, Global Investment Bank 2 retains the right to determine the market value of the mortgage loan collateral in its sole good faith discretion. Additionally, Global Investment Bank 2 is under no obligation to purchase the eligible mortgage loans we offer to sell to them. Upon our or our subsidiary’s repurchase of the mortgage loan, our subsidiaries are required to repay Global Investment Bank 2 the principal amount related to such mortgage loan plus accrued and unpaid interest at a rate based on the sum of (1) the greater of (A) the greater of (i) 0.00% and (ii) Term SOFR (which is defined as the forward-looking term rate based on the Secured Overnight Financing Rate for a corresponding tenor of one month) and (B) a pricing spread generally ranging from 1.75% to 3.35%.
Current wording
The principal amount paid by Global Investment Bank 2 for each mortgage loan is based on a percentage of the market value, cost‑basis value, or unpaid principal balance of the mortgage loan (depending on the type of loan and certain other factors and subject to certain other adjustments). Pursuant to the agreement, Global Investment Bank 2 retains the right to determine the market value of the mortgage loan collateral in its sole good faith discretion. Additionally, Global Investment Bank 2 is under no obligation to purchase the eligible mortgage loans we offer to sell to them. Upon our or our subsidiary’s repurchase of the mortgage loan, our subsidiaries are required to repay Global Investment Bank 2 the principal amount related to such mortgage loan plus accrued and unpaid interest at a rate based on the sum of (1) (A) the greater of (i) 0.00% and (ii) Term SOFR (which is defined as the forward-looking term rate based on the Secured
Previous wording
On November 7, 2023, the facility was amended to set the base interest rate spread to 1.80% plus a 0.20% index spread adjustment for the first six (6) months of seasoning on this financing facility with an additional 0.25% increase following the first six (6) months. On November 1, 2024, the facility’s termination date was extended to November 1, 2025. In addition, the base interest rate spread was reduced to a range from 1.90% to 4.75% and the index spread adjustment of 20 basis points was eliminated.
Current wording
On November 7, 2023, the facility was amended to set the base interest rate spread to 1.80% plus a 0.20% index spread adjustment for the first six (6) months of seasoning on this financing facility with an additional 0.25% increase following the first six (6) months. On September 26, 2025, the facility’s termination date was extended to September 26, 2026. In addition, the interest rate pricing spread was reduced to a range from 1.75% to 4.75%; prior to this extension, the interest rate pricing spread was a range from 1.90% to 4.75%.
Previous wording
(2) On March 28, 2024, the Company and two of its subsidiaries terminated the existing facility with Global Investment Bank 2 and the Company and two different subsidiaries entered into a new facility with Global Investment Bank 2 wherein the Company is guarantor, one of the subsidiaries is seller and Global Investment Bank 2 is buyer. This updated facility is extended through March 27, 2026. On October 25, 2024, the facility was amended to, among other changes, reduced the interest rate pricing spread to a range from 1.75% and 3.35%; prior to this amendment, the interest rate pricing spread was a range from 2.10% and 3.45%.
Current wording
(2) On March 28, 2024, the Company and two of its subsidiaries terminated the existing facility with Global Investment Bank 2 and the Company and two different subsidiaries entered into a new facility with Global Investment Bank 2 wherein the Company is guarantor, one of the subsidiaries is seller and Global Investment Bank 2 is buyer. This updated facility is extended through March 27, 2026. On October 10, 2025, the facility was amended to reduce the interest rate pricing spread to a range of 1.65% to 2.40%; prior to this amendment, the interest rate pricing spread was a range of 1.75% to 3.35%.
Previous wording
(3) On November 1, 2024, the facility’s termination date was extended to November 1, 2025. In addition, the base interest rate spread was reduced to a range from 1.90% to 4.75% and the index spread adjustment of 20 basis points was eliminated; prior to this extension, the base interest rate pricing spread was a range from 2.00% to 4.50%.
Current wording
(3) On September 26, 2025, the facility’s termination date was extended to September 26, 2026. In addition, the interest rate pricing spread was reduced to a range from 1.75% to 4.75%; prior to this extension, the interest rate pricing spread was a range from 1.90% to 4.75%.
Previous wording
In May 2025, we participated in AOMT 2025-6, an approximately $349.7 million scheduled unpaid principal balance securitization backed by a pool of residential mortgage loans, to which we contributed loans with a scheduled principal balance of $87.2 million. We used the proceeds of the securitization to repay outstanding debt of approximately $73.1 million and retained bonds of $8.1 million. The securitization released $9.2 million of cash, which was used for operational purposes. We participated in this securitization alongside other Angel Oak entities.
Current wording
Subsequent to the end of the third quarter, in October 2025, we issued AOMT 2025-10, an approximately $274.3 million scheduled unpaid principal balance securitization backed by a pool of residential mortgage loans. We issued AOMT 2025-10 as the sole contributor in the securitization. We used the proceeds to repay outstanding debt of approximately $237.4 million, and the $22.1 million of cash released is planned to be used for new loan purchases and operational purposes.
Previous wording
In April 2025, we were the sole participant in a securitization transaction of a pool of residential mortgage loans, secured exclusively by first liens on one‑to‑four family residential properties. In the transaction, AOMT 2025-4 issued approximately $284.3 million in face value of bonds. We used the proceeds of the securitization transaction to repay outstanding debt of approximately $242.4 million and retained cash of $24.7 million, which was used for new loan purchases and operational purposes.
Current wording
In April 2025, we were the sole contributor in a securitization transaction of a pool of residential mortgage loans, secured exclusively by first liens on one‑to‑four family residential properties. In the transaction, AOMT 2025-4 issued approximately $284.3 million in face value of bonds. We used the proceeds of the securitization transaction to repay outstanding debt of approximately $242.4 million and retained cash of $24.7 million, which was used for new loan purchases and operational purposes.
Showing the first 40 of 49 pairs. Open the source sections for the rest.
Rearranged current paragraphs (1)
Current report — wording carried from elsewhere
Overnight Financing Rate for a corresponding tenor of one month) and (B) a pricing spread generally ranging from 1.75% to 3.35%. On October 10, 2025, the facility was amended to, among other changes, reduced the interest rate pricing spread to a range from 1.65% and 2.40%.
Rearranged previous paragraphs (1)
Previous report — wording carried elsewhere
Resources” below for a full description of our financing arrangements. Our total borrowing capacity was $1.1 billion as of June 30, 2025; Highlights of whole loan financing facilities activity over the second quarter of 2025 are as follows: