Company: ADAMM
Filing Date: 2025-07-01
Form Type: 424B5
Source: 0001104659-25-064730
Chunk: 41

Company: ADAMAS TRUST, INC.
Filing Date: 2025-07-01
Form: 424B5
Chunk 41
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 of those tests but qualified for a “savings” provision described in the accompanying prospectus under “— Asset Tests” or “— Failure to Satisfy Gross Income Tests,” we would be required to pay a penalty tax, which could be material, in order to maintain our REIT qualification. If we did not qualify for that “savings” provision, we would fail to qualify as a REIT. See “— Failure to Qualify” in the accompanying prospectus.

#### TBAs.
**We have purchased, and may purchase in the future, Agency RMBS through “to be announced” forward contracts (“TBAs”), and we may recognize income or gains on the disposition of those TBAs, through “dollar roll” transactions or otherwise. There is no direct authority with respect to the qualification of TBAs as real estate assets or government securities for purposes of the 75% asset test, and with respect to gains from dispositions of TBAs as gains from the sale of real property (including interests in real property and interests in mortgages on real property) or other qualifying income for purposes of the 75% gross income test. However, we intend to treat our TBAs as qualifying assets for purposes of the 75% asset test, and income and gains from our TBAs as qualifying income for purposes of the 75% gross income test, based on a legal opinion of Vinson & Elkins LLP (“V&E”) substantially to the effect that (i) our TBAs should be qualifying assets for purposes of the 75% asset test to the extent of the net positive value, if any, of the TBA and (ii) any gain recognized in connection with the settlement of our TBAs, whether physically settled or settled by an offsetting TBA, should be qualifying income for purposes of the 75% gross income test. Opinions of counsel are not binding on the IRS, and no assurance can be given that the IRS will not successfully challenge the conclusions set forth in such opinion. In addition, it must be emphasized that V&E’s opinion is based on various assumptions relating to our TBAs and is conditioned upon fact-based representations and covenants made by our management regarding our TBAs. No assurance can be given that the IRS would not assert that such assets or income are not qualifying assets or income. If the IRS were to successfully challenge V&E’s opinion, we could be subject to a penalty tax or we could fail to remain qualified as a REIT if a sufficient portion of our assets consists of