Company: ADAMM
Filing Date: 2025-01-10
Form Type: 424B5
Source: 0001104659-25-002551
Chunk: 40

Company: ADAMAS TRUST, INC.
Filing Date: 2025-01-10
Form: 424B5
Chunk 40
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 by the taxpayer to whom it is issued, and the IRS may revoke a private letter ruling. Based on the analysis in those private letter rulings and other IRS guidance regarding Excess MSRs, we generally intend to treat our investments in Excess MSRs as qualifying assets for purposes of the 75% asset test to the extent the underlying mortgage loans are qualifying for purposes of such test, and as producing qualifying income for purposes of both the 75% and 95% gross income tests to the extent the underlying mortgage loans produce qualifying income for purposes of those tests, as described above. However, we do not intend to seek our own private letter ruling. Thus, the IRS could take the position that our Excess MSRs do not produce qualifying income, presumably by treating a portion of the income we receive from an Excess MSR as reasonable compensation for servicing the underlying mortgage loans. A successful challenge of our treatment of our Excess MSRs could result in our being treated as failing the 75% asset test, the 75% gross income test, and/or the 95% gross income test. If we failed any 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 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.

THE PRECEDING DISCUSSION OF ADDITIONAL MATERIAL U.S. FEDERAL INCOME TAX CONSIDERATIONS IS FOR GENERAL INFORMATION ONLY AND IS NOT TAX ADVICE. WE URGE YOU TO CONSULT YOUR TAX ADVISOR REGARDING THE PARTICULAR U.S. FEDERAL, STATE, LOCAL, AND NON-U.S. TAX CONSEQUENCES OF PURCHASING, HOLDING, AND DISPOSING OF THE NOTES, INCLUDING THE CONSEQUENCES OF ANY PROPOSED CHANGES IN APPLICABLE LAWS.**

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UNDERWRITING Morgan Stanley & Co. LLC, Piper Sandler & Co., RBC Capital Markets, LLC, UBS Securities LLC and Wells Fargo Securities, LLC are acting as joint book-running managers of the offering and as representatives of the underwriters named below. Subject to the terms and conditions stated in the underwriting agreement