Maryland | 001-40495 | 37-1892154 | |||||||||
(State or other jurisdiction of incorporation or organization) | (Commission File Number) | (I.R.S. Employer Identification No.) |
Title of each class | Trading Symbol(s) | Name of each exchange on which registered | ||||||
Common stock, $0.01 par value per share | AOMR | New York Stock Exchange |
Emerging growth company | ☐ | ||||
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. | ☐ |
Date: August 8, 2022 | ANGEL OAK MORTGAGE, INC. | ||||||||||
By: /s/ Brandon Filson | |||||||||||
Name: Brandon Filson | |||||||||||
Title: Chief Financial Officer and Treasurer | |||||||||||
PRICING TERMS | |||||
30 Days Delinquent: | Any Mortgage Loan as to which any Monthly Payment, or part thereof, remains unpaid for more than thirty (30) days (but not more than fifty-nine (59) days) following the Due Date on which such Mortgage Loan first became delinquent using the MBA Method of Delinquency. | ||||
60 Days Delinquent: | Any Mortgage Loan as to which any Monthly Payment, or part thereof, remains unpaid for sixty (60) days or more (but not more than eighty-nine (89) days) following the Due Date on which such Mortgage Loan first became delinquent using the MBA Method of Delinquency. |
Adverse Claim: | A lien, security interest, charge, encumbrance or other right or claim of any Person (other than liens created in favor of the Buyer or assigned to the Buyer by any Facility Document). | ||||
Aging Limit: | With respect to each Purchased Asset, the “Aging Limit” specified for the applicable assets, as described on Exhibit A-1 hereto. | ||||
Asset Value: | With respect to any Purchased Asset as of any date of determination, an amount equal to the product of (a) the Purchase Price Percentage for the Purchased Asset and (b) the lesser of (i) the Market Value of the Purchased Asset and (ii) the unpaid principal balance of such Purchased Asset. Without limiting the generality of the foregoing, each Seller acknowledges that the Asset Value of a Purchased Asset may be reduced to zero by Buyer if any of the following events occur: (i)a breach of a representation, warranty or covenant made by a Seller in the Repurchase Agreement with respect to such Purchased Asset has occurred and is continuing; (ii)such Purchased Asset exceeds the “Days Delinquent” specified for the applicable Purchased Asset, as described on Exhibit A-1 hereto, or is converted to an REO Property; (iii)such Purchased Asset has been released from the possession of Custodian under the Custodial Agreement for a period in excess of ten (10) business days; (iv)[reserved]; (v)such Purchased Asset has been subject to a Transaction under the Repurchase Agreement for a period of greater than the respective Aging Limit; (vi)when the Purchase Price for such Purchased Asset is added to other Purchased Assets, the aggregate Purchase Price of all Purchased Assets of any type of Mortgage Loan exceeds the applicable Concentration Limit; and (vii)the FICO score for such Purchased Asset’s related Mortgagor is [*]. | ||||
Concentration Limit: | With respect to each Purchased Asset, the “Concentration Limit” specified for the applicable assets, as described on Exhibit A-2 hereto. | ||||
Days Delinquent: | With respect to each Mortgage Loan, the number of days a Mortgagor fails to make a Monthly Payment using the MBA Method of Delinquency. | ||||
Due Diligence Cap: | $[*] for each one (1) year period following the Effective Date. | ||||
Effective Date: | April 13, 2022. |
Eligible Mortgage Loan Product: | Any Non-Agency Non-QM Mortgage Loan that is a first lien, one- to four-family residential mortgage loan evidenced by a Mortgage Note and secured by a Mortgage, which Mortgage Loan is subject to a Transaction hereunder, which in no event includes any mortgage loan which (a) is subject to Section 226.32 of Regulation Z or any similar state law (relating to high interest rate credit/lending transactions), (b) includes any single premium credit, life or accident and health insurance or disability insurance, or (c) is a High Cost Mortgage Loan. | ||||
Facility Period: | Six (6) months following the related initial Purchase Date, or as extended pursuant to the Repurchase Agreement. | ||||
FICO: | The Mortgagor’s credit score as defined in the Underwriting Guidelines. | ||||
Financial Covenants: | Guarantor shall at all times comply with each of the following: a. Tangible Net Worth. Guarantor shall maintain a Tangible Net Worth of at least $[*]. b. Indebtedness to Adjusted Tangible Net Worth Ratio. Guarantor’s ratio of Indebtedness (on and off balance sheet) to Tangible Net Worth shall not exceed [*]:1. c. Maintenance of Liquidity. Guarantor shall ensure that at all times, it has cash (other than Restricted Cash) and Cash Equivalents in an amount not less than $[*]. | ||||
Maximum Facility Amount: | $600,000,000 | ||||
MBA Method of Delinquency: | With respect to each Mortgage Loan, the methodology used by the Mortgage Bankers Association for assessing delinquency. For the avoidance of doubt, under the MBA Method of Delinquency, a Mortgage Loan is considered “30 days delinquent” if the Mortgagor fails to make a monthly payment prior to the close of business on the day that immediately precedes the due date on which the next monthly payment is due. For example, a Mortgage Loan will be considered thirty (30) days delinquent if the Mortgagor fails to make a monthly payment originally due on September 1 by the close of business on September 30. | ||||
Post-Default Rate: | An annual rate of interest equal to the Pricing Rate plus an additional [*]. | ||||
Pricing Spread: | With respect to each Purchased Asset, the “Pricing Spread” specified for the applicable assets, as described on Exhibit A-1 hereto. | ||||
Purchase Price Percentage: | With respect to each Purchased Asset, the “Purchase Price Percentage” specified for the applicable assets, as described on Exhibit A-1 hereto. | ||||
Restricted Cash: | For any Person, any amount of cash of such Person that is contractually required to be set aside, segregated or otherwise reserved. | ||||
Test Period: | Any prior fiscal quarter. |
Unrestricted Cash: | As to cash or Cash Equivalents, as of any date of determination, the sum of a Seller’s (i) cash and (ii) Cash Equivalents that are not, in either case, subject to (A) an Adverse Claim in favor of any Person or (B) that are not required to be reserved by such Seller in a restricted escrow arrangement or other similarly restricted arrangement pursuant to a contractual agreement or requirement of law. | ||||
MISCELLANEOUS TERMS | |||||
Counterparts: | This Pricing Side Letter may be executed by each of the parties hereto on any number of separate counterparts, each of which shall be an original and all of which taken together shall constitute one and the same instrument. Counterparts may be delivered electronically. Facsimile, documents executed, scanned and transmitted electronically and electronic signatures shall be deemed original signatures for purposes of this Pricing Side Letter and all matters related thereto, with such facsimile, scanned and electronic signatures having the same legal effect as original signatures. The parties agree that this Pricing Side Letter, any addendum or amendment hereto or any other document necessary for the consummation of the transaction contemplated by this Pricing Side Letter may be accepted, executed or agreed to through the use of an electronic signature in accordance with the Electronic Signatures in Global and National Commerce Act, Title 15, United States Code, Sections 7001 et seq., the Uniform Electronic Transaction Act and any applicable state law. Any document accepted, executed or agreed to in conformity with such laws will be binding on all parties hereto to the same extent as if it were physically executed and each party hereby consents to the use of any secure third party electronic signature capture service providers, as long as such service providers use system logs and audit trails that establish a temporal and process link between the presentation of identity documents and the electronic signing, together with identifying information that can be used to verify the electronic signature and its attribution to the signer’s identity and evidence of the signer’s agreement to conduct the transaction electronically and of the signer’s execution of each electronic signature. | ||||
Governing Law: | THIS PRICING SIDE LETTER IS GOVERNED BY THE LAW OF THE STATE OF NEW YORK. | ||||
Severability: | Each provision and agreement in this Pricing Side Letter shall be treated as separate and independent from any other provision or agreement herein and shall be enforceable notwithstanding the unenforceability of any such other provision or agreement. |
Purchased Asset | Aging Limit (all days are calendar days unless otherwise noted) | Concentration Limit | Pricing Spread | Purchase Price Percentage* | Days Delinquent | ||||||||||||
Non-Agency Non-QM Mortgage Loans | [*]days | See Exhibit A-2 | [*]% | [*]% | [*] days** |
Concentration Limits* | ||||||||
Collateral Attribute | Percentage of Maximum Facility Amount | |||||||
FICO Score | <580 | [*]% | ||||||
<620 | [*]% | |||||||
<680 | [*]% | |||||||
State of Mortgaged Property | CA | [*]% | ||||||
FL | [*]% | |||||||
GA | [*]% | |||||||
Any other single state | [*]% | |||||||
Days Delinquent | 30 Days Delinquent + 60 Days Delinquent, in the aggregate | [*]% | ||||||
Original LTV | >90 | [*]% | ||||||
>80 | [*]% | |||||||
Debt to Income Ratio of the Related Mortgagor | >50 | [*]% | ||||||
>55 | [*]% | |||||||
Original Unpaid Principal Balance | > $2,000,000 but < $2,500,000 | [*]% | ||||||
>$2,500,000 but < $3,000,000 | [*]% | |||||||
>$3,000,000 but < $3,500,000 | [*]% | |||||||
>$3,500,000 | [*]% | |||||||
Collateral Type | Limited Documentation Mortgage Loan | [*]% | ||||||
Second Lien Mortgage Loan | [*]% | |||||||
Cash-Out Refinance Mortgage Loan | [*]% | |||||||
Interest-Only Mortgage Loan | [*]% | |||||||
Investor Mortgage Loan | [*]% | |||||||
Original Loan Rating | “C” or lower from a third-party due diligence provider, which rating is retained for more than one month following the related Purchase Date | [*]% |