# Ares Commercial Real Estate (ACRE) 10-Q SEC filing - Q2 FY2026

- Filed: Aug 3, 2026, 8:00 PM EDT
- Fiscal quarter: Q2 FY2026
- Calendar quarter: Q2 2026
- Accession: 0001628280-26-052072
- OpenCapital page: https://www.opencapital.sh/filings/0001628280-26-052072
- Markdown URL: https://www.opencapital.sh/filings/0001628280-26-052072.md
- Official SEC filing index: https://www.sec.gov/Archives/edgar/data/1529377/000162828026052072/0001628280-26-052072-index.htm

## Filing documents

- [10-Q (acre-20260630.htm)](https://www.sec.gov/Archives/edgar/data/1529377/000162828026052072/acre-20260630.htm)
- [EX-10.1 (exhibit101-citibankeightha.htm)](https://www.sec.gov/Archives/edgar/data/1529377/000162828026052072/exhibit101-citibankeightha.htm)
- [EX-31.1 (acreq2-26exhibit311.htm)](https://www.sec.gov/Archives/edgar/data/1529377/000162828026052072/acreq2-26exhibit311.htm)
- [EX-31.2 (acreq2-26exhibit312.htm)](https://www.sec.gov/Archives/edgar/data/1529377/000162828026052072/acreq2-26exhibit312.htm)
- [EX-32.1 (acreq2-26exhibit321.htm)](https://www.sec.gov/Archives/edgar/data/1529377/000162828026052072/acreq2-26exhibit321.htm)

---

## 10-Q

SEC source: [acre-20260630.htm](https://www.sec.gov/Archives/edgar/data/1529377/000162828026052072/acre-20260630.htm)

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

☒       QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 

For the quarterly period ended June 30, 2026

 OR

 ☐       TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 

For the transition period from _____ to _____

Commission File No. 001-35517

 ARES COMMERCIAL REAL ESTATE CORPORATION

(Exact name of Registrant as specified in its charter)

Maryland 45-3148087

(State or other jurisdiction of (I.R.S. Employer

incorporation or organization) Identification Number)

245 Park Avenue, 42nd Floor, New York, NY 10167

(Address of principal executive offices) (Zip Code)

(212) 750-7300

(Registrant’s telephone number, including area code)

N/A

(Former name, former address and former fiscal year, if changed since last report)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class Trading Symbol(s) Name of each exchange on which registered

Common stock, $0.01 par value per share ACRE New York Stock Exchange

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days: Yes ý No o

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ý No o

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act. (Check one):

Large accelerated filer ☐ Accelerated filer ☒

Non-accelerated filer ☐ Smaller reporting company ☐

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. o

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date.

Class Outstanding at July 30, 2026

Common stock, $0.01 par value 55,481,113

TABLE OF CONTENTS

Page

[Part I. Financial Information](#i68b61950cea14e18bdbce7735e0ba5cd_13)

[Item 1. Consolidated Financial Statements](#i68b61950cea14e18bdbce7735e0ba5cd_16)

[Consolidated Balance Sheets as of](#i68b61950cea14e18bdbce7735e0ba5cd_19)[June 30](#i68b61950cea14e18bdbce7735e0ba5cd_19)[, 2026 (unaudited) and December 31, 2025](#i68b61950cea14e18bdbce7735e0ba5cd_19) [5](#i68b61950cea14e18bdbce7735e0ba5cd_19)

[Consolidated Statements of Operations for the Three](#i68b61950cea14e18bdbce7735e0ba5cd_22)[and Six](#i68b61950cea14e18bdbce7735e0ba5cd_22)[Months Ended](#i68b61950cea14e18bdbce7735e0ba5cd_22)[June 30](#i68b61950cea14e18bdbce7735e0ba5cd_22)[, 2026 and 2025 (unaudited)](#i68b61950cea14e18bdbce7735e0ba5cd_22) [6](#i68b61950cea14e18bdbce7735e0ba5cd_22)

[Consolidated Statements of Comprehensive Income (Loss) for the Three](#i68b61950cea14e18bdbce7735e0ba5cd_25)[and Six](#i68b61950cea14e18bdbce7735e0ba5cd_25)[Months Ended](#i68b61950cea14e18bdbce7735e0ba5cd_25)[June 30](#i68b61950cea14e18bdbce7735e0ba5cd_25)[, 2026 and 2025 (unaudited)](#i68b61950cea14e18bdbce7735e0ba5cd_25) [7](#i68b61950cea14e18bdbce7735e0ba5cd_25)

[Consolidated Statements of Stockholders’ Equity for the Three](#i68b61950cea14e18bdbce7735e0ba5cd_28)[and Six](#i68b61950cea14e18bdbce7735e0ba5cd_28)[Months Ended](#i68b61950cea14e18bdbce7735e0ba5cd_28)[June 30](#i68b61950cea14e18bdbce7735e0ba5cd_28)[, 2026 (unaudited) and the Year Ended December 31, 2025](#i68b61950cea14e18bdbce7735e0ba5cd_28) [8](#i68b61950cea14e18bdbce7735e0ba5cd_28)

[Consolidated Statements of Cash Flows for the](#i68b61950cea14e18bdbce7735e0ba5cd_34)[Six](#i68b61950cea14e18bdbce7735e0ba5cd_34)[Months Ended](#i68b61950cea14e18bdbce7735e0ba5cd_34)[June 3](#i68b61950cea14e18bdbce7735e0ba5cd_34)[0](#i68b61950cea14e18bdbce7735e0ba5cd_34)[, 2026 and 2025 (unaudited)](#i68b61950cea14e18bdbce7735e0ba5cd_34) [9](#i68b61950cea14e18bdbce7735e0ba5cd_34)

[Notes to Consolidated Financial Statements (unaudited)](#i68b61950cea14e18bdbce7735e0ba5cd_37) [10](#i68b61950cea14e18bdbce7735e0ba5cd_37)

[Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations](#i68b61950cea14e18bdbce7735e0ba5cd_112) [38](#i68b61950cea14e18bdbce7735e0ba5cd_112)

[Item 3. Quantitative and Qualitative Disclosures About Market Risk](#i68b61950cea14e18bdbce7735e0ba5cd_133) [49](#i68b61950cea14e18bdbce7735e0ba5cd_133)

[Item 4. Controls and Procedures](#i68b61950cea14e18bdbce7735e0ba5cd_136) [52](#i68b61950cea14e18bdbce7735e0ba5cd_136)

[Part II. Other Information](#i68b61950cea14e18bdbce7735e0ba5cd_139)

[Item 1. Legal Proceedings](#i68b61950cea14e18bdbce7735e0ba5cd_142) [52](#i68b61950cea14e18bdbce7735e0ba5cd_142)

[Item 1A. Risk Factors](#i68b61950cea14e18bdbce7735e0ba5cd_145) [52](#i68b61950cea14e18bdbce7735e0ba5cd_145)

[Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](#i68b61950cea14e18bdbce7735e0ba5cd_148) [53](#i68b61950cea14e18bdbce7735e0ba5cd_148)

[Item 3. Defaults Upon Senior Securities](#i68b61950cea14e18bdbce7735e0ba5cd_151) [53](#i68b61950cea14e18bdbce7735e0ba5cd_151)

[Item 4. Mine Safety Disclosures](#i68b61950cea14e18bdbce7735e0ba5cd_154) [53](#i68b61950cea14e18bdbce7735e0ba5cd_154)

[Item 5. Other Information](#i68b61950cea14e18bdbce7735e0ba5cd_157) [53](#i68b61950cea14e18bdbce7735e0ba5cd_157)

[Item 6. Exhibits](#i68b61950cea14e18bdbce7735e0ba5cd_160) [54](#i68b61950cea14e18bdbce7735e0ba5cd_160)

[Signatures](#i68b61950cea14e18bdbce7735e0ba5cd_163) [55](#i68b61950cea14e18bdbce7735e0ba5cd_163)

FORWARD-LOOKING STATEMENTS

Some of the statements contained in this quarterly report constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and we intend such statements to be covered by the safe harbor provisions contained therein. The information contained in this section should be read in conjunction with our consolidated financial statements and notes thereto appearing elsewhere in this quarterly report on Form 10-Q. In addition, some of the statements in this quarterly report (including in the following discussion) constitute forward-looking statements, which relate to future events or the future performance or financial condition of Ares Commercial Real Estate Corporation (“ACRE” and, together with its consolidated subsidiaries, the “Company,” “we,” “us” and “our”). The forward-looking statements contained in this report involve a number of risks and uncertainties, including:

- global economic trends and economic conditions, including slower growth, changes to fiscal and monetary policy, inflation, labor shortages, changing interest rates, foreign currency exchange volatility and uncertainties caused by tariffs and trade disputes with other countries, as well as pronounced geopolitical instability, including resulting from actions and initiatives of the United States government or governments outside of the United States and international conflicts such as the military operation in Iran and conflicts in the Middle East;
- management’s estimate of current expected credit losses (“CECL”) and current expected credit loss reserve (“CECL Reserve”);
- market dynamics impacting particular real estate properties, such as office properties;
- the amount of commercial mortgage loans requiring refinancing;
- the demand for commercial real estate loans;
- rates of default or decreased recovery rates on our target investments;
- changes in interest rates and credit spreads;
- our ability to obtain, maintain, repay or refinance financing arrangements, including securitizations;
- market conditions and our ability to access alternative debt markets and additional debt and equity capital;
- our expected investment capacity and available capital;
- financing and advance rates for our target investments;
- our expected leverage;
- our business and investment strategy;
- our projected operating results;
- the return or impact of current and future investments;
- the collectability and timing of cash flows, if any, from our investments;
- estimates relating to our ability to make distributions to our stockholders in the future;
- defaults by borrowers in paying amounts due on outstanding indebtedness and our ability to collect all amounts due according to the contractual terms of our investments;
- rates of prepayments on our mortgage loans and the effect on our business of such prepayments;
- the degree to which our hedging strategies may or may not protect us from interest rate volatility;
- availability of investment opportunities in mortgage-related and real estate-related investments and securities;
- security incidents or cyber-attacks that could adversely affect our business or the business of our borrowers;
- technological developments in artificial intelligence that could disrupt the markets in which we and our borrowers operate;
- the ability of Ares Commercial Real Estate Management LLC (“ACREM” or our “Manager”) to locate suitable investments for us, monitor, service and administer our investments and execute our investment strategy;
- allocation of investment opportunities to us by our Manager, including with respect to co-investments;
- the effect of requests for information or regulatory proceedings or investigations against us, our Manager or its affiliates, and the costs and expenses in connection therewith;
- our ability to maintain our qualification as a real estate investment trust (“REIT”) for United States federal income tax purposes;
- our ability to maintain our exemption from registration under the Investment Company Act of 1940 (the “1940 Act”);
- our competition;
- general volatility of the securities markets in which we may invest;
- adverse changes in the real estate, real estate capital and credit markets and the impact of a protracted decline in the liquidity of credit markets on our business;
- changes in governmental regulations, including with respect to immigration, tax law and rates, and similar matters (including interpretation thereof); and
- market trends in our industry, real estate values or the debt securities markets.

We use words such as “anticipates,” “believes,” “expects,” “intends,” “project,” “estimates,” “will,” “should,” “could,” “would,” “may” and similar expressions to identify forward-looking statements, although not all forward-looking statements include these words. Our actual results and financial condition could differ materially from those implied or expressed in the forward-looking statements for any reason, including the risks, uncertainties and other factors set forth in Part I, Item 1A, “Risk Factors” in our annual report on Form 10-K for the fiscal year ended December 31, 2025 (“2025 Annual Report”) and the other information included in our 2025 Annual Report and elsewhere in our subsequent quarterly reports on Form 10-Q.

We have based the forward-looking statements included in this quarterly report on information available to us on the date of this quarterly report, and we assume no obligation to update any such forward-looking statements. Although we undertake no obligation to revise or update any forward-looking statements, whether as a result of new information, future events or otherwise, you are advised to consult any additional disclosures that we may make directly to you or through reports that we have filed or in the future may file with the SEC, including annual reports on Form 10-K, registration statements on Form S-3, quarterly reports on Form 10-Q and current reports on Form 8-K.

PART I - FINANCIAL INFORMATION

## Item 1: Consolidated Financial Statements

**ARES COMMERCIAL REAL ESTATE CORPORATION AND SUBSIDIARIES**

### CONSOLIDATED BALANCE SHEETS

_(in thousands, except share and per share data)_

| Line item | As of / June 30, 2026 | As of / December 31, 2025 |
| --- | --- | --- |
|  | (unaudited) |  |
| ASSETS |  |  |
| Cash and cash equivalents | $17,558 | $29,289 |
| Restricted cash ($1,108 related to consolidated VIEs as of December 31, 2025) | 41,017 | 37,868 |
| Loans held for investment ($138,950 related to consolidated VIEs as of December 31, 2025) | 1,748,835 | 1,528,806 |
| Current expected credit loss reserve | (137,810) | (125,756) |
| Loans held for investment, net of current expected credit loss reserve | 1,611,025 | 1,403,050 |
| Real estate owned held for investment, net ($52,634 related to consolidated VIEs as of December 31, 2025) | 76,238 | 130,165 |
| Real estate owned held for sale | 53,934 | — |
| Other assets ($76 of interest receivable related to consolidated VIEs as of December 31, 2025) | 17,503 | 17,770 |
| Total assets | $1,817,275 | $1,618,142 |
| LIABILITIES AND STOCKHOLDERS' EQUITY |  |  |
| LIABILITIES |  |  |
| Secured funding agreements | $1,173,027 | $858,176 |
| Secured term loan | 89,722 | 89,360 |
| Collateralized loan obligation securitization debt (consolidated VIEs) | — | 99,921 |
| Due to affiliate | 4,199 | 4,061 |
| Dividends payable | 8,458 | 8,442 |
| Other liabilities ($257 of interest payable related to consolidated VIEs as of December 31, 2025) | 52,644 | 48,614 |
| Total liabilities | 1,328,050 | 1,108,574 |
| Commitments and contingencies (Note 7) |  |  |
| STOCKHOLDERS' EQUITY |  |  |
| Common stock, par value $0.01 per share, 450,000,000 shares authorized at June 30, 2026 and December 31, 2025 and 55,481,113 and 55,026,453 shares issued and outstanding at June 30, 2026 and December 31, 2025, respectively | 532 | 532 |
| Additional paid-in capital | 822,606 | 820,827 |
| Accumulated earnings (deficit) | (333,913) | (311,791) |
| Total stockholders' equity | 489,225 | 509,568 |
| Total liabilities and stockholders' equity | $1,817,275 | $1,618,142 |

See accompanying notes to consolidated financial statements.

**ARES COMMERCIAL REAL ESTATE CORPORATION AND SUBSIDIARIES**

### CONSOLIDATED STATEMENTS OF OPERATIONS

_(in thousands, except share and per share data) · (unaudited)_

| Line item | For the Three Months Ended June 30, 2026 | For the Three Months Ended June 30, 2025 | For the Six Months Ended June 30, 2026 | For the Six Months Ended June 30, 2025 |
| --- | --- | --- | --- | --- |
| Revenue: |  |  |  |  |
| Interest income | $27,754 | $23,117 | $52,660 | $50,597 |
| Interest expense | (19,182) | (16,101) | (36,543) | (34,290) |
| Net interest margin | 8,572 | 7,016 | 16,117 | 16,307 |
| Revenue from real estate owned | 5,784 | 5,549 | 11,699 | 11,206 |
| Total revenue | 14,356 | 12,565 | 27,816 | 27,513 |
| Expenses: |  |  |  |  |
| Management and incentive fees to affiliate | 2,394 | 2,430 | 4,794 | 4,997 |
| Professional fees | 699 | 673 | 1,519 | 1,550 |
| General and administrative expenses | 1,723 | 1,995 | 3,140 | 3,715 |
| General and administrative expenses reimbursed to affiliate | 853 | 1,024 | 1,639 | 2,027 |
| Expenses from real estate owned | 3,301 | 4,628 | 6,435 | 9,123 |
| Total expenses | 8,970 | 10,750 | 17,527 | 21,412 |
| (Provision for) reversal of current expected credit losses, net | (865) | 20,150 | (12,003) | 25,490 |
| Realized losses on loans | — | (33,000) | (3,340) | (33,000) |
| Income (loss) before income taxes | 4,521 | (11,035) | (5,054) | (1,409) |
| Income tax expense (benefit), including excise tax | 138 | — | 169 | 281 |
| Net income (loss) attributable to common stockholders | $4,383 | $(11,035) | $(5,223) | $(1,690) |
| Earnings (loss) per common share: |  |  |  |  |
| Basic earnings (loss) per common share | $0.08 | $(0.20) | $(0.09) | $(0.03) |
| Diluted earnings (loss) per common share | $0.08 | $(0.20) | $(0.09) | $(0.03) |
| Weighted average number of common shares outstanding: |  |  |  |  |
| Basic weighted average shares of common stock outstanding | 55,367,375 | 54,856,949 | 55,344,923 | 54,842,959 |
| Diluted weighted average shares of common stock outstanding | 56,354,988 | 54,856,949 | 55,344,923 | 54,842,959 |
| Dividends declared per share of common stock | $0.15 | $0.15 | $0.30 | $0.30 |

See accompanying notes to consolidated financial statements.

**ARES COMMERCIAL REAL ESTATE CORPORATION AND SUBSIDIARIES**

### CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)

_(in thousands) · (unaudited)_

| Line item | For the Three Months Ended June 30, 2026 | For the Three Months Ended June 30, 2025 | For the Six Months Ended June 30, 2026 | For the Six Months Ended June 30, 2025 |
| --- | --- | --- | --- | --- |
| Net income (loss) attributable to common stockholders | $4,383 | $(11,035) | $(5,223) | $(1,690) |
| Other comprehensive income (loss): |  |  |  |  |
| Change in unrealized gains (losses) on available-for-sale debt securities | — | 21 | — | (9) |
| Comprehensive income (loss) | $4,383 | $(11,014) | $(5,223) | $(1,699) |

See accompanying notes to consolidated financial statements.

**ARES COMMERCIAL REAL ESTATE CORPORATION AND SUBSIDIARIES**

### CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY

_(in thousands, except share and per share data) · (unaudited)_

| Line item | Common Stock / Shares | Common Stock / Amount | Additional Paid-in Capital | Accumulated Other Comprehensive Income (Loss) | Accumulated Earnings (Deficit) | Total Stockholders’ Equity |
| --- | --- | --- | --- | --- | --- | --- |
| Balance at December 31, 2024 | 54,542,178 | $532 | $816,923 | $37 | $(277,360) | $540,132 |
| Stock‑based compensation | 314,799 | — | 1,050 | — | — | 1,050 |
| Other comprehensive income (loss) | — | — | — | (30) | — | (30) |
| Net income (loss) | — | — | — | — | 9,345 | 9,345 |
| Dividends declared | — | — | — | — | (8,354) | (8,354) |
| Balance at March 31, 2025 | 54,856,977 | $532 | $817,973 | $7 | $(276,369) | $542,143 |
| Stock‑based compensation | 148,376 | — | 937 | — | — | 937 |
| Other comprehensive income (loss) | — | — | — | 21 | — | 21 |
| Net income (loss) | — | — | — | — | (11,035) | (11,035) |
| Dividends declared | — | — | — | — | (8,368) | (8,368) |
| Balance at June 30, 2025 | 55,005,353 | $532 | $818,910 | $28 | $(295,772) | $523,698 |
| Stock‑based compensation | 16,933 | — | 1,024 | — | — | 1,024 |
| Other comprehensive income (loss) | — | — | — | (28) | — | (28) |
| Net income (loss) | — | — | — | — | 4,653 | 4,653 |
| Dividends declared | — | — | — | — | (8,365) | (8,365) |
| Balance at September 30, 2025 | 55,022,286 | $532 | $819,934 | — | $(299,484) | $520,982 |
| Stock‑based compensation | 4,167 | — | 893 | — | — | 893 |
| Net income (loss) | — | — | — | — | (3,865) | (3,865) |
| Dividends declared | — | — | — | — | (8,442) | (8,442) |
| Balance at December 31, 2025 | 55,026,453 | $532 | $820,827 | — | $(311,791) | $509,568 |
| Stock‑based compensation | 341,219 | — | 897 | — | — | 897 |
| Net income (loss) | — | — | — | — | (9,605) | (9,605) |
| Dividends declared | — | — | — | — | (8,442) | (8,442) |
| Balance at March 31, 2026 | 55,367,672 | $532 | $821,724 | — | $(329,838) | $492,418 |
| Stock‑based compensation | 113,441 | — | 882 | — | — | 882 |
| Net income (loss) | — | — | — | — | 4,383 | 4,383 |
| Dividends declared | — | — | — | — | (8,458) | (8,458) |
| Balance at June 30, 2026 | 55,481,113 | $532 | $822,606 | — | $(333,913) | $489,225 |

See accompanying notes to consolidated financial statements.

**ARES COMMERCIAL REAL ESTATE CORPORATION AND SUBSIDIARIES**

### CONSOLIDATED STATEMENTS OF CASH FLOWS

_(in thousands) · (unaudited)_

| Line item | For the Six Months Ended June 30, 2026 | For the Six Months Ended June 30, 2025 |
| --- | --- | --- |
| Operating activities: |  |  |
| Net income (loss) | $(5,223) | $(1,690) |
| Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities: |  |  |
| Amortization of deferred financing costs | 2,376 | 2,421 |
| Accretion of discounts, deferred loan origination fees and costs | (2,645) | (1,997) |
| Stock-based compensation | 1,779 | 1,987 |
| Depreciation and amortization of real estate owned | 1,491 | 4,501 |
| Provision for (reversal of) current expected credit losses, net | 12,003 | (25,490) |
| Realized losses on loans | 3,340 | 33,000 |
| Changes in operating assets and liabilities: |  |  |
| Other assets | (7,659) | 110 |
| Due to affiliate | 138 | 355 |
| Other liabilities | 1,338 | (307) |
| Net cash provided by (used in) operating activities | 6,938 | 12,890 |
| Investing activities: |  |  |
| Issuance of and fundings on loans held for investment | (332,108) | (19,085) |
| Principal collections and cost-recovery proceeds on loans held for investment | 114,317 | 342,596 |
| Receipt of origination and other loan fees | 3,754 | 1,554 |
| Principal repayment of available-for-sale debt securities | — | 870 |
| Purchases of capitalized additions to real estate owned | (1,498) | (937) |
| Receipt (disbursement) of escrows and reserves for loans held for investment, net | 4,257 | — |
| Net cash provided by (used in) investing activities | (211,278) | 324,998 |
| Financing activities: |  |  |
| Proceeds from secured funding agreements | 430,553 | 114,797 |
| Repayments of secured funding agreements | (115,702) | (61,423) |
| Repayments of secured term loan | — | (20,000) |
| Payment of secured funding costs | (2,287) | (2,709) |
| Repayments of debt of consolidated VIEs | (99,921) | (318,434) |
| Dividends paid | (16,885) | (22,278) |
| Net cash provided by (used in) financing activities | 195,758 | (310,047) |
| Change in cash, cash equivalents and restricted cash | (8,582) | 27,841 |
| Cash, cash equivalents and restricted cash, beginning of period | 67,157 | 66,294 |
| Cash, cash equivalents and restricted cash, end of period | $58,575 | $94,135 |
| Reconciliation of cash, cash equivalents and restricted cash: |  |  |
| Cash and cash equivalents | $17,558 | $89,985 |
| Restricted cash | 41,017 | 4,150 |
| Total cash, cash equivalents and restricted cash shown in the Consolidated Statements of Cash Flows | $58,575 | $94,135 |
| Supplemental disclosure of noncash investing and financing activities: |  |  |
| Dividends declared, but not yet paid | $8,458 | $8,368 |

See accompanying notes to consolidated financial statements.

ARES COMMERCIAL REAL ESTATE CORPORATION AND SUBSIDIARIES

### NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

As of June 30, 2026

(in thousands, except share and per share data, percentages and as otherwise indicated)

(unaudited)

1. ORGANIZATION

Ares Commercial Real Estate Corporation (together with its consolidated subsidiaries, the “Company” or “ACRE”) is a specialty finance company primarily engaged in directly originating and investing in commercial real estate loans and related investments. Through Ares Commercial Real Estate Management LLC (“ACREM” or the Company’s “Manager”), a Securities and Exchange Commission (“SEC”) registered investment adviser and a subsidiary of Ares Management Corporation (NYSE: ARES) (“Ares Management” or “Ares”), a publicly traded, leading global alternative investment manager, it has investment professionals strategically located across the United States and Europe who directly source new loan opportunities for the Company with owners, operators and sponsors of commercial real estate (“CRE”) properties. The Company was formed and commenced operations in late 2011. The Company is a Maryland corporation and completed its initial public offering in May 2012. The Company is externally managed by its Manager, pursuant to the terms of a management agreement (the “Management Agreement”).

The Company operates as one operating segment and is primarily focused on directly originating and managing a diversified portfolio of CRE debt-related investments for the Company’s own account. The Company’s target investments include whole and co-invested senior mortgage loans, subordinated debt, preferred equity and mezzanine loans, as well as other CRE investments, including commercial mortgage-backed securities. These investments are generally held for investment and are secured, directly or indirectly, by office, multifamily, retail, industrial, lodging, self storage, student housing, residential and other commercial real estate properties, or by ownership interests therein.

The Company has elected and qualified to be taxed as a real estate investment trust (“REIT”) for United States federal income tax purposes under the Internal Revenue Code of 1986, as amended (the “Code”), commencing with its taxable year ended December 31, 2012. The Company generally will not be subject to United States federal income taxes on its REIT taxable income as long as it annually distributes all of its REIT taxable income prior to the deduction for dividends paid to stockholders and complies with various other requirements as a REIT.

2. SIGNIFICANT ACCOUNTING POLICIES

The accompanying unaudited consolidated interim financial statements should be read in conjunction with the audited consolidated financial statements and the related management's discussion and analysis of financial condition and results of operations included in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2025 filed with the SEC.

Refer to the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2025 for a description of the Company’s recurring accounting policies. The Company has included disclosure below regarding basis of presentation and other accounting policies that (i) are required to be disclosed quarterly or (ii) the Company views as critical as of the date of this report.

Basis of Presentation

The accompanying unaudited consolidated interim financial statements have been prepared on the accrual basis of accounting in conformity with United States generally accepted accounting principles (“GAAP”) and include the accounts of the Company, the consolidated variable interest entities (“VIEs”) that the Company controls and of which the Company is the primary beneficiary, and the Company’s wholly-owned subsidiaries. The unaudited consolidated interim financial statements reflect all adjustments and reclassifications that, in the opinion of management, are necessary for the fair presentation of the Company’s results of operations and financial condition as of and for the periods presented. All intercompany balances and transactions have been eliminated.

The unaudited consolidated interim financial statements are prepared in accordance with GAAP and pursuant to the requirements for reporting on Form 10-Q and Article 10 of Regulation S-X. The current period’s results of operations will not necessarily be indicative of results for any other interim period or that ultimately may be achieved for the year ending December 31, 2026.

Use of Estimates in the Preparation of Financial Statements

The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect certain reported amounts and disclosures. Global macroeconomic conditions, including higher tariffs, high inflation, changes to fiscal, monetary and trade policy, high interest rates, potential market-wide liquidity problems, currency fluctuations, labor shortages and challenges in the supply chain, have the potential to negatively impact the Company and its borrowers. These current macroeconomic conditions may continue or aggravate and could cause the United States economy or other global economies to experience an economic slowdown or recession. We anticipate our business and operations could be materially adversely affected by a prolonged recession in the United States or other major global economy.

The Company believes the estimates and assumptions underlying its consolidated financial statements are reasonable and supportable based on the information available as of June 30, 2026, however, uncertainty over the global economy and the Company’s business, makes any estimates and assumptions as of June 30, 2026 inherently less certain than they would be absent the current and potential impacts of current macroeconomic conditions. Actual results could differ from those estimates.

Variable Interest Entities

The Company evaluates all of its interests in VIEs for consolidation. When the Company’s interests are determined to be variable interests, the Company assesses whether it is deemed to be the primary beneficiary of the VIE. The primary beneficiary of a VIE is required to consolidate the VIE. Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) Topic 810, Consolidation, defines the primary beneficiary as the party that has both (i) the power to direct the activities of the VIE that most significantly impact its economic performance, and (ii) the obligation to absorb losses and the right to receive benefits from the VIE which could be potentially significant. The Company considers its variable interests, as well as any variable interests of its related parties in making this determination. Where both of these factors are present, the Company is deemed to be the primary beneficiary and it consolidates the VIE. Where either one of these factors is not present, the Company is not the primary beneficiary and it does not consolidate the VIE.

To assess whether the Company has the power to direct the activities of a VIE that most significantly impact the VIE’s economic performance, the Company considers all facts and circumstances, including its role in establishing the VIE and its ongoing rights and responsibilities. This assessment includes first, identifying the activities that most significantly impact the VIE’s economic performance; and second, identifying which party, if any, has power over those activities. In general, the parties that make the most significant decisions affecting the VIE or have the right to unilaterally remove those decision makers are deemed to have the power to direct the activities of a VIE.

To assess whether the Company has the obligation to absorb losses of the VIE or the right to receive benefits from the VIE that could potentially be significant to the VIE, the Company considers all of its economic interests, including debt and equity investments, servicing fees, and other arrangements deemed to be variable interests in the VIE. This assessment requires that the Company apply judgment in determining whether these interests, in the aggregate, are considered potentially significant to the VIE. Factors considered in assessing significance include: the design of the VIE, including its capitalization structure; subordination of interests; payment priority; relative share of interests held across various classes within the VIE’s capital structure; and the reasons why the interests are held by the Company.

For VIEs of which the Company is determined to be the primary beneficiary, all of the underlying assets, liabilities, equity, revenue and expenses of the structures are consolidated into the Company’s consolidated financial statements.

The Company performs an ongoing reassessment of: (1) whether any entities previously evaluated under the majority voting interest framework have become VIEs, based on certain events, and therefore are subject to the VIE consolidation framework, and (2) whether changes in the facts and circumstances regarding its involvement with a VIE cause the Company’s consolidation conclusion regarding the VIE to change. See Note 14 included in these consolidated financial statements for further discussion of the Company’s VIEs.

Restricted Cash

Restricted cash includes: (1) funds on deposit with financial institutions related to real estate owned properties that are held in the Company’s consolidated VIEs and (2) escrow deposits or reserves for taxes, insurance, leasing outlays, capital expenditures, tenant security deposits and payments required under certain loan agreements. These escrow deposits or reserves are held on behalf of the respective borrowers related to the Company’s loans held for investment and are offset by escrow liabilities included in other liabilities in the Company's consolidated balance sheets.

Loans Held for Investment

The Company originates CRE debt and related instruments generally to be held for investment. Loans that are held for investment are carried at cost, net of unamortized purchase discounts, deferred loan fees and origination costs and cost-recovery proceeds. The resulting amount, which excludes the CECL Reserve (as defined below), is referred to as the “Carrying Value.” Loans are generally collateralized by real estate. The extent of any credit deterioration associated with the performance and/or value of the underlying collateral property and the financial and operating capability of the borrower could impact the expected amounts received. The Company monitors performance of its loans held for investment portfolio under the following methodology: (1) borrower review, which analyzes the borrower’s ability to execute on its original business plan, reviews its financial condition, assesses pending litigation and considers its general level of responsiveness and cooperation; (2) economic review, which considers underlying collateral (i.e. leasing performance, unit sales and cash flow of the collateral and its ability to cover debt service, as well as the residual loan balance at maturity); (3) property review, which considers current environmental risks, changes in insurance costs or coverage, current site visibility, capital expenditures and market perception; and (4) market review, which analyzes the collateral from a supply and demand perspective of similar property types, as well as from a capital markets perspective. Such analyses are completed and reviewed by asset management and finance personnel who utilize various data sources, including periodic financial data such as property occupancy, tenant profile, rental rates, operating expenses, and the borrower’s exit plan, among other factors.

Loans are generally placed on non-accrual status when principal or interest payments are past due 30 days or more or when there is reasonable doubt that principal or interest will be collected in full. Accrued and unpaid interest is generally reversed against interest income in the period the loan is placed on non-accrual status. Interest payments received on non-accrual loans may be recognized as income or applied to reduce loan Carrying Value depending upon management’s judgment regarding the borrower’s ability to make pending principal and interest payments. Non-accrual loans are restored to accrual status when past due principal and interest are paid and, in management’s judgment, are likely to remain current. The Company may make exceptions to placing a loan on non-accrual status if the loan has sufficient collateral value and is in the process of collection.

Loan balances that are deemed to be uncollectible are written-off as a realized loss and are deducted from the CECL Reserve (as defined below). The write-offs are recorded in the period in which the loan balance is deemed uncollectible based on management’s judgment.

Current Expected Credit Losses

FASB ASC Topic 326, Financial Instruments—Credit Losses (“ASC 326”), requires the Company to reflect current expected credit losses (“CECL”) on both the outstanding balances and unfunded commitments on loans held for investment and requires consideration of a broad range of historical experience adjusted for current conditions and reasonable and supportable forecast information to inform credit loss estimates (the “CECL Reserve”). Increases and decreases to expected credit losses impact earnings and are recorded within (provision for) reversal of current expected credit losses, net in the Company’s consolidated statements of operations. The CECL Reserve related to outstanding balances on loans held for investment required under ASC 326 is a valuation account that is deducted from the amortized cost basis of the Company’s loans held for investment in the Company’s consolidated balance sheets. The CECL Reserve related to unfunded commitments on loans held for investment is recorded within other liabilities in the Company’s consolidated balance sheets. See Note 4 included in these consolidated financial statements for CECL related disclosures.

Loans Held for Sale

Although the Company generally holds its target investments as long-term investments, the Company occasionally classifies some of its investments as held for sale if there is an intent to sell the investment prior to maturity or payoff. Investments held for sale are carried at the lower of carrying amount or fair value within loans held for sale in the Company’s consolidated balance sheets, with changes in fair value recorded through earnings. If a loan is determined to be held for sale at the time of origination, upfront fees and origination costs are deferred and any portion retained is recognized into interest income at the time of sale.

In March 2026, the Company originated a senior mortgage loan as part of a co-investment collateralized by a retail property located in California. At the time of origination, the Company classified a portion of the loan as held for sale as the Company intended to sell such portion. In June 2026, the Company sold this portion of the loan at fair value, which was equal to the Company’s carrying amount, and no gain or loss was recognized on the sale. At the time of the sale, the portion of the loan that was sold had an outstanding principal balance of $61.4 million. See Note 12 included in these consolidated financial statements for additional details on the sale of the loan. The Company had no loans held for sale as of June 30, 2026 and December 31, 2025.

Real Estate Owned Held for Investment

Real estate assets held for investment are carried at their estimated fair value at acquisition and are presented net of accumulated depreciation or amortization and impairment charges. The Company allocates the purchase price of acquired real estate assets held for investment based on the fair value of the acquired land, buildings and improvements, furniture, fixtures and equipment, intangible assets and intangible liabilities, as applicable.

Real estate assets held for investment are depreciated or amortized using the straight-line method over estimated useful lives of up to 40 years for buildings and improvements, up to 15 years for furniture, fixtures and equipment and over the lease terms for intangible assets and liabilities. Renovations and/or replacements that improve or extend the life of the real estate asset are capitalized and depreciated over their estimated useful lives. The cost of ordinary repairs and maintenance are expensed as incurred. Other than amortization related to intangible assets and liabilities for above-market or below-market leases, depreciation or amortization expense related to real estate assets held for investment is included within expenses from real estate owned in the Company’s consolidated statements of operations. Amortization for above-market or below-market leases is recognized as an adjustment to rental revenue and is included within revenue from real estate owned in the Company’s consolidated statements of operations.

Real estate assets held for investment are evaluated for indicators of impairment on a quarterly basis. Factors that the Company may consider in its impairment analysis include, among others: (1) significant underperformance relative to historical or anticipated operating results; (2) significant negative industry or economic trends; (3) costs necessary to extend the life or improve the real estate asset; (4) significant increase in competition; and (5) ability to hold and dispose of the real estate asset in the ordinary course of business. A real estate asset is considered impaired when the sum of estimated future undiscounted cash flows expected to be generated by the real estate asset over the estimated remaining holding period is less than the carrying amount of such real estate asset. Cash flows include operating cash flows and anticipated capital proceeds generated by the real estate asset. An impairment charge is recorded equal to the excess of the carrying amount of the real estate asset over the fair value. When determining the fair value of a real estate asset, the Company makes certain assumptions including, but not limited to, consideration of projected operating cash flows, comparable selling prices and projected cash flows from the eventual disposition of the real estate asset based upon the Company’s estimate of a capitalization rate and discount rate.

Real Estate Owned Held for Sale

The Company reviews its real estate assets, from time to time, in order to determine whether to sell such assets. Real estate assets are classified as held for sale when, in accordance with FASB ASC Topic 360, Property, Plant and Equipment, the Company commits to a plan to sell the asset, when the asset is being actively marketed for sale at a reasonable price and the sale of the asset is probable and the transfer of the asset is expected to qualify for recognition as a completed sale within one year. Real estate assets that are held for sale are carried at the lower of the asset’s carrying amount or its fair value less costs to sell.

Debt Issuance Costs

Debt issuance costs under the Company’s indebtedness are capitalized and amortized over the term of the respective debt instrument. Unamortized debt issuance costs are expensed when the associated debt is repaid prior to maturity. Debt issuance costs related to debt securitizations are capitalized and amortized over the term of the underlying loans using the effective interest method. When an underlying loan is prepaid in a debt securitization and the outstanding principal balance of the securitization debt is reduced, the related unamortized debt issuance costs are charged to expense based on a pro‑rata share of the debt issuance costs being allocated to the specific loans that were prepaid. Amortization of debt issuance costs is included within interest expense, except as noted below, in the Company’s consolidated statements of operations while the unamortized balance on the (i) Secured Funding Agreements (each individually defined in Note 6 included in these consolidated financial statements) is included within other assets and (ii) the Secured Term Loan (defined in Note 6 included in these consolidated financial statements) and debt securitizations are each included as a reduction to the carrying amount of the liability, in the Company’s consolidated balance sheets, as applicable.

Revenue Recognition

Interest income is accrued based on the outstanding principal amount and the contractual terms of each loan or debt security. For loans held for investment, the origination fees, contractual exit fees and direct origination costs are also recognized in interest income over the initial loan term as a yield adjustment using the effective interest method. For loans held for sale, upfront fees and origination costs are deferred and any portion retained is recognized into interest income at the time of sale.

For available-for-sale debt securities, premiums or discounts are amortized or accreted into interest income as a yield adjustment using the effective interest method.

Revenue from real estate owned represents revenue associated with the operations of a multi-building office property acquired in September 2024 and a mixed-use property acquired in September 2023.

Revenue from the operation of the office and mixed-use properties consists primarily of rental revenue from operating leases. For each operating lease with scheduled rent increases over the term of the lease, the Company recognizes rental revenue on a straight-line basis over the lease term when collectability of the lease payment is probable. Variable lease payments are recognized as rental revenue in the period when the changes in facts and circumstances on which the variable lease payments are based occur. Certain of the Company’s office and mixed-use property leases also contain provisions for tenants to reimburse the Company for property operating expenses. Such reimbursements are included in rental revenue on a gross basis. Rental revenue also includes amortization of intangible assets and liabilities related to above- and below-market leases.

Net Interest Margin and Interest Expense

Net interest margin in the Company’s consolidated statements of operations serves to measure the performance of the Company’s loans and debt securities as compared to its use of debt leverage. The Company includes interest income from its loans and debt securities and interest expense related to its Secured Funding Agreements, securitization debt and the Secured Term Loan (each individually defined in Note 6 included in these consolidated financial statements), as applicable, in net interest margin. For the three and six months ended June 30, 2026 and 2025, interest expense is comprised of the following ($ in thousands):

| Line item | For the Three Months Ended June 30, 2026 | For the Three Months Ended June 30, 2025 | For the Six Months Ended June 30, 2026 | For the Six Months Ended June 30, 2025 |
| --- | --- | --- | --- | --- |
| Secured funding agreements | $17,710 | $11,921 | $33,325 | $22,137 |
| Securitization debt | — | 2,512 | 349 | 8,728 |
| Secured term loan | 1,472 | 1,668 | 2,869 | 3,425 |
| Interest expense | $19,182 | $16,101 | $36,543 | $34,290 |

#### Comprehensive Income (Loss)

Comprehensive income (loss) consists of net income (loss) and OCI that are excluded from net income (loss).

3.   LOANS HELD FOR INVESTMENT

As of June 30, 2026, the Company’s portfolio included 38 loans held for investment, excluding 197 loans that were repaid, sold, converted to real estate owned or written-off since inception. The aggregate originated commitment under these loans at closing was approximately $2.0 billion and outstanding principal was $1.8 billion as of June 30, 2026. During the six months ended June 30, 2026, the Company funded $339.6 million of outstanding principal and received repayments of $110.7 million of outstanding principal. As of June 30, 2026, 89.2% of the Company’s loans have Secured Overnight Financing Rate (“SOFR”) floors, with a weighted average floor of 1.71%, calculated based on loans with SOFR floors. References to SOFR or “S” are to 30-day SOFR (unless otherwise specifically stated).

The Company’s investments in loans held for investment are accounted for at amortized cost. The following tables summarize the Company’s loans held for investment as of June 30, 2026 and December 31, 2025 ($ in thousands):

_As of June 30, 2026_

| Line item | Carrying Value (1) | Outstanding Principal (1) | Weighted Average Unleveraged Effective Yield | Weighted Average Remaining Life (Years) (4) |
| --- | --- | --- | --- | --- |
| Senior mortgage loans | $1,729,417 | $1,818,946 | (3)%% | 1.4 |
| Subordinated debt and preferred equity investments | 19,418 | 21,223 | (3)%% | 0.8 |
| Total loans held for investment portfolio | $1,748,835 | $1,840,169 | (3)%% | 1.4 |

_As of December 31, 2025_

| Line item | Carrying Value (1) | Outstanding Principal (1) | Weighted Average Unleveraged Effective Yield | Weighted Average Remaining Life (Years) (4) |
| --- | --- | --- | --- | --- |
| Senior mortgage loans | $1,509,670 | $1,580,074 | (3)%% | 1.3 |
| Subordinated debt and preferred equity investments | 19,136 | 20,985 | (3)%% | 1.3 |
| Total loans held for investment portfolio | $1,528,806 | $1,601,059 | (3)%% | 1.3 |

(1) The difference between the Carrying Value and the Outstanding Principal amount of the loans held for investment consists of unamortized purchase discounts, deferred loan fees and origination costs and cost-recovery proceeds.

(2) Unleveraged Effective Yield is the compounded effective rate of return that would be earned over the life of the investment based on the contractual interest rate (adjusted for any deferred loan fees, costs, premiums or discounts) and assumes no dispositions, early prepayments or defaults. The total Weighted Average Unleveraged Effective Yield is calculated based on the average of Unleveraged Effective Yield of all loans held by the Company as of June 30, 2026 and December 31, 2025 as weighted by the total outstanding principal balance of each loan.

(3) Unleveraged Effective Yield is the compounded effective rate of return that would be earned over the life of the investment based on the contractual interest rate (adjusted for any deferred loan fees, costs, premiums or discounts) and assumes no dispositions, early prepayments or defaults. The total Weighted Average Unleveraged Effective Yield is calculated based on the average of Unleveraged Effective Yield of all interest accruing loans held by the Company as of June 30, 2026 and December 31, 2025 as weighted by the total outstanding principal balance of each interest accruing loan (excludes loans on non-accrual status as of June 30, 2026 and December 31, 2025).

(4) Remaining Life is based on contractual maturity date and does not include contractual extension options not yet exercised.

A more detailed listing of the Company’s loans held for investment portfolio based on information available as of June 30, 2026 is as follows ($ in millions):

| Loan Type | Location | Outstanding Principal (1) | Carrying Value (1) | Interest Rate | Unleveraged Effective Yield (2) | Maturity Date (3) | Payment Terms (4) |
| --- | --- | --- | --- | --- | --- | --- | --- |
| Senior Mortgage Loans: |  |  |  |  |  |  |  |
| Residential/Condo | NY | $189.5 | $140.2 | S+8.95% | —% | Dec 2026 | I/O |
| Office | IL | 169.0 | 136.3 | (6) | —% | Jul 2026 | I/O |
| Multifamily | NY | 132.2 | 131.8 | S+3.90% | 7.8% | Jun 2027 | I/O |
| Industrial | GA | 96.9 | 96.1 | S+2.25% | 6.3% | Oct 2028 | I/O |
| Multifamily | NY | 84.0 | 83.1 | S+2.45% | 6.5% | Mar 2029 | I/O |
| Office | NC | 72.7 | 72.7 | S+3.65% | 7.3% | Aug 2028 | I/O |
| Self Storage | Diversified | 70.6 | 70.0 | S+2.50% | 6.5% | Dec 2028 | I/O |
| Multifamily | TX | 67.4 | 67.2 | S+2.95% | 7.2% | Dec 2026 | P/I |
| Retail | CA | 67.3 | 66.6 | S+2.75% | 6.8% | Mar 2029 | I/O |
| Office | AZ | 65.0 | 65.0 | S+2.00% | 5.7% | Oct 2027 | I/O |
| Office | NY | 65.0 | 65.0 | S+2.65% | 6.3% | Jul 2028 | I/O |
| Self Storage | Diversified | 65.0 | 64.3 | S+2.70% | 6.7% | May 2029 | I/O |
| Multifamily | OH | 57.3 | 57.2 | S+3.05% | 7.1% | Oct 2026 | I/O |
| Hotel | NY | 55.7 | 55.6 | S+4.40% | 8.3% | Mar 2027 | I/O |
| Industrial | CA | 55.2 | 54.8 | S+3.00% | 7.0% | Nov 2028 | I/O |
| Office | IL | 53.7 | 53.7 | S+4.25% | 8.0% | Jan 2027 | P/I |
| Multifamily | NC | 50.0 | 49.7 | S+2.40% | 6.6% | Oct 2027 | I/O |
| Multifamily | MA | 49.0 | 48.6 | S+3.10% | 7.3% | Oct 2027 | I/O |
| Hotel | SC | 48.3 | 47.9 | S+3.50% | 7.6% | Nov 2028 | I/O |
| Industrial | MA | 45.6 | 45.5 | S+2.90% | 6.7% | Jun 2028 | I/O |
| Hotel | CA | 35.0 | 34.7 | S+2.95% | 7.1% | Jun 2028 | I/O |
| Mixed-Use | NY | 29.9 | 29.5 | S+3.25% | 7.8% | Jan 2028 | I/O |
| Industrial | NJ | 27.8 | 27.8 | S+8.85% | 12.5% | Nov 2024 | I/O |
| Hotel | Diversified | 23.9 | 23.7 | S+3.75% | 7.8% | Nov 2028 | I/O |
| Multifamily | TN | 22.6 | 22.3 | S+2.55% | 6.6% | May 2029 | I/O |
| Hotel | FL | 19.4 | 19.2 | S+3.35% | 7.4% | Dec 2028 | I/O |
| Multifamily | TX | 18.2 | 18.2 | S+2.60% | 6.5% | Jul 2026 | I/O |
| Self Storage | FL | 12.3 | 12.3 | S+3.25% | 7.0% | Dec 2027 | I/O |
| Self Storage | IN | 11.4 | 11.4 | S+3.60% | 7.5% | Aug 2026 | I/O |
| Self Storage | AZ | 10.8 | 10.8 | S+3.25% | 7.2% | Feb 2028 | I/O |
| Self Storage | FL | 9.6 | 9.6 | S+3.75% | 7.5% | Jun 2028 | I/O |
| Self Storage | PA | 8.9 | 8.9 | S+3.50% | 7.5% | May 2028 | I/O |
| Office | Diversified | 7.9 | 7.9 | S+3.75% | 12.4% | Jul 2026 | P/I |
| Self Storage | MA | 7.7 | 7.7 | S+3.00% | 6.9% | Nov 2026 | I/O |
| Self Storage | FL | 7.1 | 7.1 | S+3.50% | 7.5% | Apr 2028 | I/O |
| Industrial | CA | 7.0 | 7.0 | S+3.85% | 7.5% | Jan 2027 | I/O |
| Subordinated Debt and Preferred Equity Investments: |  |  |  |  |  |  |  |
| Industrial | CA | 12.6 | 10.9 | S+3.85% | —% | Jan 2027 | I/O |
| Office | AZ | 8.7 | 8.5 | (10) | 6.6% | Oct 2027 | I/O |
| Total/Weighted Average |  | $1,840.2 | $1,748.8 |  | 5.7% |  |  |

(1) The difference between the Carrying Value and the Outstanding Principal amount of the loans held for investment consists of unamortized purchase discounts, deferred loan fees and origination costs and cost-recovery proceeds. For the loans held for investment that represent co-investments with other investment vehicles managed by Ares Management (see Note 12 included in these consolidated financial statements for additional information on co-investments), only the portion of Carrying Value and Outstanding Principal held by the Company is reflected.

(2) Unleveraged Effective Yield is the compounded effective rate of return that would be earned over the life of the investment based on the contractual interest rate (adjusted for any deferred loan fees, costs, premiums or discounts) and assumes no dispositions, early prepayments or defaults. Unleveraged Effective Yield for each loan is calculated based on SOFR as of June 30, 2026 or the SOFR floor, as applicable. The total Weighted Average Unleveraged Effective Yield is calculated based on the average of Unleveraged Effective Yield of all loans held by the Company as of June 30, 2026 as weighted by the outstanding principal balance of each loan.

(3) Reflects the initial loan maturity date excluding any contractual extension options. Certain loans are subject to contractual extension options that generally vary between one and two 12-month extensions and may be subject to performance based or other conditions as stipulated in the loan agreement. Actual maturities may differ from contractual maturities stated herein as certain borrowers may have the right to prepay with or without paying a prepayment penalty. The Company may also extend contractual maturities and amend other terms of the loans in connection with loan modifications.

(4) I/O = interest only, P/I = principal and interest.

(5) The New York loan is structured as both a senior and mezzanine loan with the Company holding contiguous positions. The senior and mezzanine positions each have a per annum interest rate of S + 8.95%. The senior and mezzanine loans were both on non-accrual status as of June 30, 2026 and the Unleveraged Effective Yield is not applicable.

(6) The Illinois loan is structured as both a senior and mezzanine loan with the Company holding contiguous positions. The senior position has a per annum interest rate of S + 2.25% and the mezzanine position has a fixed per annum interest rate of 10.00%. The senior and mezzanine loans were both on non-accrual status as of June 30, 2026 and the Unleveraged Effective Yield is not applicable. In January 2026, the Company and the borrower entered into a modification and extension agreement to, among other things, extend the maturity date on the Illinois loan from January 2026 to April 2026. Further, in April 2026, the Company and the borrower entered into a modification and extension agreement to, among other things, extend the maturity date on the Illinois loan from April 2026 to July 2026. For the three and six months ended June 30, 2026, the Company received $1.7 million and $3.3 million, respectively, of interest payments in cash on the senior loan that was recognized as a reduction to the Carrying Value of the loan and the borrower is current on all contractual interest payments.

(7) In June 2026, the Company and the borrower entered into a modification and extension agreement to, among other things, extend the maturity date on the senior New York loan from June 2026 to June 2027.

(8) In January 2026, the Company and the borrower entered into a modification and extension agreement to, among other things, extend the maturity date on the senior Texas loan from January 2026 to December 2026.

(9) In February 2023, amortization began on the senior diversified loan, which had an outstanding principal balance of $7.9 million as of June 30, 2026. In January 2026, amortization began on both the senior Texas loan and the senior Illinois loan, which had outstanding principal balances of $67.4 million and $53.7 million, respectively, as of June 30, 2026. The remainder of the loans in the Company’s portfolio are non-amortizing through their primary terms.

(10) The Arizona loan is structured as a senior A-Note with an outstanding principal balance of $65.0 million, a subordinated B-Note with no initial outstanding principal balance and an unfunded commitment of $12.0 million for certain lender approved leasing costs and a subordinated C-Note with an outstanding principal balance of $8.7 million. The subordinated B-Note is pari-passu with new borrower contributions for the loan principal paydown and other additional capital contributions. The subordinated C-Note is subordinate to the A-Note, B-Note and the new borrower contributions. The senior A-Note has a per annum interest rate of S + 2.00%, the subordinated B-Note has a fixed per annum interest rate of 12.00% and the subordinated C-Note has a fixed per annum interest rate of 5.50%. As of June 30, 2026, the borrower is current on all contractual interest payments for the senior A-Note and the subordinated C-Note.

(11) In March 2026, the borrower exercised a 12-month extension option in accordance with the loan agreement, which extended the maturity date on the senior New York loan to March 2027.

(12) As of June 30, 2026, the senior New Jersey loan, which is collateralized by an industrial property, is in maturity default due to the failure of the borrower to repay the outstanding principal balance of the loan by the November 2024 maturity date and the borrower is current on all contractual interest payments.

(13) In January 2026, the Company and the borrower entered into a modification and extension agreement to, among other things, extend the maturity date on the senior Texas loan from January 2026 to May 2026. Further, in June 2026, the Company and the borrower entered into a modification and extension agreement to, among other things, extend the maturity date on the senior Texas loan from May 2026 to July 2026.

(14) In June 2026, the Company and the borrower entered into a modification and extension agreement to, among other things, extend the maturity date on the senior Indiana loan from June 2026 to August 2026.

(15) The California loan is structured as a senior A-Note, with an outstanding principal balance of $7.0 million as of June 30, 2026, a subordinated B-Note with no outstanding principal balance and an unfunded commitment of $500 thousand for certain lender approved leasing costs and a subordinated C-Note with an outstanding principal balance of $12.6 million as of June 30, 2026. The subordinated B-Note and C-Note are subordinate to new borrower equity related to additional capital contributions. As of June 30, 2026, the subordinated C-Note was on non-accrual status and therefore, the Unleveraged Effective Yield is not applicable. As of June 30, 2026, the borrower is current on all contractual interest payments for the senior A-Note and the subordinated C-Note.

The Company has made, and may continue to make, modifications to loans, including loans that are in default. Loan terms that may be modified include interest rates, required prepayments, asset release prices, maturity dates, covenants, principal amounts and other loan terms. The terms and conditions of each modification vary based on individual circumstances and are determined on a case-by-case basis. The Company’s Manager monitors and evaluates each of the Company’s loans held for investment and maintains regular communications with borrowers and sponsors regarding the potential impacts of current macroeconomic conditions on the Company’s loans.

For the six months ended June 30, 2026, the activity in the Company’s loan portfolio was as follows ($ in thousands):

|  |  |  |
| --- | --- | --- |
| Balance at December 31, 2025 | $ | $1,528,806 |
| Initial funding | 309,234 |  |
| Origination and other loan fees and discounts, net of costs | (4,392) |  |
| Additional funding | 30,363 |  |
| Amortizing payments | (5,398) |  |
| Loan payoffs (1) | (112,252) |  |
| Origination and other loan fees and discount accretion | 2,474 |  |
| Balance at June 30, 2026 | $ | $1,748,835 |

(1) In March 2026, the Company received a discounted payoff on a senior mortgage loan with outstanding principal of $28.2 million, which was collateralized by a multifamily property located in Pennsylvania, in conjunction with the sale of the multifamily property by the borrower. For the six months ended June 30, 2026, the Company recognized a realized loss of $3.3 million in the Company’s consolidated statements of operations as the Carrying Value of the senior mortgage loan exceeded the net proceeds from the payoff of the loan.

Except as described in the table above listing the Company’s loans held for investment portfolio, as of June 30, 2026, all loans held for investment were paying in accordance with their contractual terms. As of June 30, 2026, the Company had three loans held for investment on non-accrual status with a Carrying Value of $287.3 million. As of December 31, 2025, the Company had four loans held for investment on non-accrual status with a Carrying Value of $308.1 million.

4. CURRENT EXPECTED CREDIT LOSSES

The Company estimates its CECL Reserve primarily using a probability-weighted model that considers the likelihood of default and expected loss given default for each individual loan. Calculation of the CECL Reserve requires loan-specific data, which includes capital senior to the Company when the Company is the subordinate lender, changes in net operating income, debt service coverage ratio, loan-to-value, occupancy, property type and geographic location. Estimating the CECL Reserve also requires significant judgment with respect to various factors, including (i) the appropriate historical loan loss reference data, (ii) the expected timing of loan repayments, (iii) calibration of the likelihood of default to reflect the risk characteristics of the Company’s loan portfolio, (iv) the underlying collateral performance and its estimated current and stabilized market values, including projected cash flows and (v) the Company’s current and future view of the macroeconomic environment. The Company may consider loan-specific qualitative factors on certain loans to estimate its CECL Reserve. In order to estimate the future expected loan losses relevant to the Company’s portfolio, the Company utilizes historical market loan loss data licensed from a third party data service. The third party’s loan database includes historical loss data for commercial mortgage-backed securities, or CMBS, issued dating back to 1998, which the Company believes is a reasonably comparable and available data set to its type of loans. The Company utilized macroeconomic forecasts and inputs that reflected a blend of a stable and a weaker economic outlook in the near term; however, the actual financial impact on the Company of the current environment is highly uncertain. For periods beyond the reasonable and supportable forecast period, the Company reverts back to historical loss data. Management’s current estimate of expected credit losses as of June 30, 2026 increased compared to the estimate of expected credit losses as of March 31, 2026 primarily due to changes in loan- and collateral-specific attributes, new loan closings and a relative decline in the near-term macroeconomic forecasts during the three months ended June 30, 2026. These factors were partially offset by shorter average remaining loan term and other changes in loan- and collateral-specific attributes during the three months ended June 30, 2026. The CECL Reserve also takes into consideration the assumed impact of macroeconomic conditions on CRE properties and is not specific to any loan losses or impairments on the Company’s loans held for investment, unless the Company determines that a specifically identifiable reserve is warranted for a select asset.

In certain instances, the Company may identify specific loans to be collateral dependent. The Company considers loans to be collateral dependent if both of the following criteria are met: (i) the loan is expected to be substantially repaid through the operation or sale of the underlying collateral, and (ii) the borrower is experiencing financial difficulty. The determination of whether these criteria are met for an individual loan requires the use of significant judgment and can be based on several factors subject to uncertainty.

For such loans that the Company determines that foreclosure of the collateral is probable, the Company estimates the CECL Reserve based on the difference between the fair value of the collateral (less costs to sell the asset if repayment is expected through the sale of the collateral) and the amortized cost basis of the loan as of the measurement date. For collateral dependent loans that the Company determines foreclosure is not probable, the Company may apply a practical expedient to estimate the CECL Reserve using the difference between the collateral’s fair value (less costs to sell the asset if repayment is expected through the sale of the collateral) and the amortized cost basis of the loan. To determine the fair value of the collateral, the Company may employ different approaches depending on the type of collateral, including methods such as the income approach or the market approach. These methods require the use of key unobservable inputs, which are inherently uncertain and subjective. Determining the appropriate valuation method and selecting the appropriate key unobservable inputs and assumptions requires significant judgment and consideration of factors specific to the underlying collateral being assessed. Additionally, the key unobservable inputs and assumptions that may be used could vary depending on the information available and market conditions as of the valuation date. As such, the fair value that may be used in calculating the CECL Reserve is subject to uncertainty and any actual losses, if incurred, could differ materially from the CECL Reserve.

As of June 30, 2026, the Company’s CECL Reserve for its loans held for investment portfolio is $139.1 million or 723 basis points of the Company’s total loans held for investment commitment balance of $1.9 billion and is bifurcated between the CECL Reserve (contra-asset) related to outstanding balances on loans held for investment of $137.8 million and a liability for unfunded commitments of $1.3 million. The liability was based on the unfunded portion of the loan commitment over the full contractual period over which the Company is exposed to credit risk through a current obligation to extend credit. Management considered the likelihood that funding will occur, and if funded, the expected credit loss on the funded portion.

As of June 30, 2026, the senior mortgage loan on an office property located in Illinois with a principal balance of $169.0 million and the subordinated loan on an industrial property located in California with a principal balance of $12.6 million each had a risk rating of “5.” As of June 30, 2026, each of these loans were assessed individually and the Company elected to assign a CECL Reserve of $67.0 million on the Illinois office loan and $9.4 million on the subordinated California industrial loan. The CECL Reserve for each of these loans was determined by referencing the Company’s estimate of the collateral’s fair value in relation to the amortized cost basis of the loan. Each CECL Reserve is included in the Company’s total CECL Reserve.

Current Expected Credit Loss Reserve for Funded Loan Commitments    

Activity related to the CECL Reserve for outstanding balances on the Company’s loans held for investment as of and for the three and six months ended June 30, 2026 was as follows ($ in thousands):

|  |  |  |
| --- | --- | --- |
| Balance at March 31, 2026 (1) | $ | $136,830 |
| Provision for (reversal of) current expected credit losses, net | 980 |  |
| Balance at June 30, 2026 (1) | $ | $137,810 |
| Balance at December 31, 2025 (1) | $ | $125,756 |
| Provision for (reversal of) current expected credit losses, net | 12,054 |  |
| Balance at June 30, 2026 (1) | $ | $137,810 |

(1) The CECL Reserve related to outstanding balances on loans held for investment is recorded within current expected credit loss reserve in the Company’s consolidated balance sheets.

Current Expected Credit Loss Reserve for Unfunded Loan Commitments    

Activity related to the CECL Reserve for unfunded commitments on the Company’s loans held for investment as of and for the three and six months ended June 30, 2026 was as follows ($ in thousands):

|  |  |  |
| --- | --- | --- |
| Balance at March 31, 2026 (1) | $ | $1,444 |
| Provision for (reversal of) current expected credit losses, net | (115) |  |
| Balance at June 30, 2026 (1) | $ | $1,329 |
| Balance at December 31, 2025 (1) | $ | $1,380 |
| Provision for (reversal of) current expected credit losses, net | (51) |  |
| Balance at June 30, 2026 (1) | $ | $1,329 |

(1) The CECL Reserve related to unfunded commitments on loans held for investment is recorded within other liabilities in the Company’s consolidated balance sheets.

The Company continuously evaluates the credit quality of each loan by assessing the risk factors of each loan and assigning a risk rating based on a variety of factors. Risk factors include property type, geographic and local market dynamics, physical condition, leasing and tenant profile, projected cash flow, loan structure and exit plan, loan-to-value ratio, debt service coverage ratio, project sponsorship, and other factors deemed necessary. Based on a 5-point scale, the Company’s loans are rated “1” through “5,” from less risk to greater risk, which ratings are defined as follows:

| Ratings | Definition |
| --- | --- |
| 1 | Very Low Risk |
| 2 | Low Risk |
| 3 | Medium Risk |
| 4 | High Risk/Potential for Loss: Asset performance is trailing underwritten expectations. Loan at risk of impairment without material improvement to performance |
| 5 | Impaired/Loss Likely: A loan that has a significantly increased probability of default and principal loss |

The risk ratings are primarily based on historical data as well as taking into account future economic conditions.

As of June 30, 2026, the Carrying Value of the Company’s loans held for investment within each risk rating by year of origination is as follows ($ in thousands):

| Line item | 2026 | 2025 | 2024 | 2023 | 2022 | Prior | Total |
| --- | --- | --- | --- | --- | --- | --- | --- |
| Risk rating: |  |  |  |  |  |  |  |
| 1 | — | — | — | — | — | $7,920 | $7,920 |
| 2 | 29,449 | — | — | 102,739 | 139,500 | 92,805 | 364,493 |
| 3 | 271,062 | 458,671 | — | 11,437 | 109,231 | 230,140 | 1,080,541 |
| 4 | — | — | — | — | 140,195 | 8,538 | 148,733 |
| 5 | — | — | — | — | — | 147,148 | 147,148 |
| Total | $300,511 | $458,671 | — | $114,176 | $388,926 | $486,551 | $1,748,835 |

Accrued Interest Receivable

The Company elected not to measure a CECL Reserve on accrued interest receivable due to the Company’s policy of writing-off uncollectible accrued interest receivable balances in a timely manner. As of June 30, 2026 and December 31, 2025, interest receivable of $6.2 million and $6.4 million, respectively, is included within other assets in the Company’s consolidated balance sheets and is excluded from loans held for investment. If the Company were to have uncollectible accrued interest receivable, it generally would reverse accrued and unpaid interest against interest income and no longer accrue for these amounts.

5. REAL ESTATE OWNED

On September 19, 2024, the Company acquired legal title to a multi-building office property located in North Carolina through a deed in lieu of foreclosure. Prior to September 19, 2024, the office property collateralized a $68.6 million senior mortgage loan held by the Company that was in maturity default due to the failure of the borrower to repay the outstanding principal balance of the loan by the May 2024 maturity date. In conjunction with the deed in lieu of foreclosure, the Company derecognized the $68.6 million senior mortgage loan and recognized the office property as real estate owned. As the Company did not expect to complete a sale of the office property within the next twelve months, the office property was considered held for investment, and was carried at its estimated fair value at acquisition and was presented net of accumulated depreciation or amortization and impairment charges. At acquisition, the Company recognized a realized loss of $5.8 million on the derecognition of the senior mortgage loan as the fair value of the office property at acquisition of $60.2 million and the net operating assets and liabilities held at the office property of $(201) thousand at acquisition was less than the $65.8 million Carrying Value of the senior mortgage loan. Certain operating assets and liabilities of the office property are included within other assets and other liabilities, respectively, in the Company’s consolidated balance sheets and include items such as prepaid expenses, rent receivables, straight-line rent receivables and payables and trade payables. On December 30, 2025, the Company sold a building at the multi-building office property to a third party for $5.3 million.

During the six months ended June 30, 2026, the Company committed to a plan to sell the multi-building office property and the asset is being actively marketed for sale with such sale expected to qualify for recognition as a completed sale within one year. As such, as of June 30, 2026, the multi-building office property is classified as real estate owned held for sale in the Company’s consolidated balance sheets and the Company has ceased depreciating and amortizing the multi-building office property. Upon reclassification, the multi-building office property had a carrying amount of $53.1 million, which was lower than the estimated fair value less costs to sell. As such, the Company has continued to recognize the multi-building office property at its carrying amount in the Company’s consolidated balance sheets and no impairment loss related to the planned sale of the multi-building office property has been recognized in the Company’s consolidated statements of operations for the six months ended June 30, 2026.

On September 8, 2023, the Company acquired legal title to a mixed-use property located in Florida through a consensual foreclosure. Prior to September 8, 2023, the mixed-use property collateralized an $82.9 million senior mortgage loan held by the Company that was in maturity default due to the failure of the borrower to repay the outstanding principal balance of the loan by the February 2023 maturity date. In conjunction with the consensual foreclosure, the Company derecognized the $82.9 million senior mortgage loan and recognized the mixed-use property as real estate owned. As the Company does not expect to complete a sale of the mixed-use property within the next twelve months, the mixed-use property is considered held for investment, and is carried at its estimated fair value at acquisition and is presented net of accumulated depreciation or amortization and impairment charges. The Company did not recognize any gain or loss on the derecognition of the senior mortgage loan as the fair value of the mixed-use property of $84.3 million and the net operating assets and liabilities held at the mixed-use property of $(1.4) million at acquisition approximated the $82.9 million Carrying Value of the senior mortgage loan. Certain operating assets and liabilities of the mixed-use property are included within other assets and other liabilities, respectively, in the Company’s consolidated balance sheets and include items such as prepaid expenses, rent receivables, straight-line rent receivables and payables and trade payables.

The following table summarizes the Company’s real estate owned held for investment as of June 30, 2026 and December 31, 2025 ($ in thousands):

| Line item | As of / June 30, 2026 | As of / December 31, 2025 |
| --- | --- | --- |
| Land | $21,337 | $34,245 |
| Buildings and improvements | 52,788 | 81,691 |
| Lease intangibles | 21,276 | 34,735 |
| Above-market lease intangibles | 547 | 4,490 |
| Below-market lease intangibles | (11,084) | (11,105) |
| Total real estate owned held for investment | 84,864 | 144,056 |
| Less: Accumulated depreciation and amortization | (8,626) | (13,891) |
| Real estate owned held for investment, net | $76,238 | $130,165 |

As of June 30, 2026 and December 31, 2025, no impairment charges have been recognized for real estate owned held for investment.

For the three and six months ended June 30, 2026, the Company incurred net depreciation and amortization expense of $749 thousand and $1.5 million, respectively. For the three and six months ended June 30, 2025, the Company incurred net depreciation and amortization expense of $2.3 million and $4.5 million, respectively. With the exception of amortization related to intangible assets and liabilities for above-market or below-market leases, depreciation and amortization expense is included within expenses from real estate owned in the Company’s consolidated statements of operations. Amortization related to intangible assets and liabilities for above-market or below-market leases is recognized as an adjustment to rental revenue and is included within revenue from real estate owned in the Company’s consolidated statements of operations.

Intangible Lease Assets and Liabilities

For the six months ended June 30, 2026, there were no property acquisitions.

The following table summarizes the Company’s intangible lease assets and liabilities that are included within real estate owned held for investment as of June 30, 2026 and December 31, 2025 ($ in thousands):

| Line item | As of June 30, 2026 / Gross | As of June 30, 2026 / Accumulated Amortization | As of June 30, 2026 / Net | As of December 31, 2025 / Gross | As of December 31, 2025 / Accumulated Amortization | As of December 31, 2025 / Net |
| --- | --- | --- | --- | --- | --- | --- |
| Assets: |  |  |  |  |  |  |
| Lease intangibles | $21,276 | $(6,240) | $15,036 | $34,735 | $(9,772) | $24,963 |
| Above-market lease intangibles | 547 | (275) | 272 | 4,490 | (1,468) | 3,022 |
| Liabilities: |  |  |  |  |  |  |
| Below-market lease intangibles | (11,084) | 2,710 | (8,374) | (11,105) | 2,398 | (8,707) |

The following table summarizes the amortization of intangible lease assets and liabilities related to real estate owned held for investment for the three and six months ended June 30, 2026 and 2025 ($ in thousands):

| Line item | Consolidated Statementof Operations Location | For the Three Months Ended June 30, 2026 | For the Three Months Ended June 30, 2025 | For the Six Months Ended June 30, 2026 | For the Six Months Ended June 30, 2025 |
| --- | --- | --- | --- | --- | --- |
| Assets: |  |  |  |  |  |
| Lease intangibles | Expenses from real estate owned | $442 | $1,589 | $924 | $3,115 |
| Above-market lease intangibles | Revenue from real estate owned | (19) | (343) | (38) | (615) |
| Liabilities: |  |  |  |  |  |
| Below-market lease intangibles | Revenue from real estate owned | 143 | 262 | 332 | 524 |

The following table summarizes the estimated net amortization schedule for the Company’s intangible lease assets and liabilities that are included within real estate owned held for investment as of June 30, 2026 ($ in thousands):

| Line item | Lease Intangibles | Above-Market / Lease Intangibles | Below-Market / Lease Intangibles |
| --- | --- | --- | --- |
| Remainder of 2026 | $883 | $38 | $(286) |
| 2027 | 1,701 | 51 | (571) |
| 2028 | 1,603 | 41 | (542) |
| 2029 | 1,596 | 41 | (539) |
| 2030 | 1,592 | 41 | (539) |
| Thereafter | 7,661 | 60 | (5,897) |
| Total | $15,036 | $272 | $(8,374) |

Future Minimum Lease Payments

The following table summarizes the future minimum contractual lease payments to be collected by the Company under non-cancelable operating leases related to real estate owned held for investment, excluding tenant reimbursements of expenses and variable lease payments, as of June 30, 2026 ($ in thousands):

|  |  |  |
| --- | --- | --- |
| Remainder of 2026 | $ | $5,217 |
| 2027 | 10,170 |  |
| 2028 | 10,156 |  |
| 2029 | 10,344 |  |
| 2030 | 10,236 |  |
| Thereafter | 14,007 |  |
| Total | $ | $60,130 |

6. DEBT

Financing Agreements

The Company borrows funds, as applicable in a given period, under the Wells Fargo Facility, the Citibank Facility, the CNB Facility and the Morgan Stanley Facility (individually defined below and collectively, the “Secured Funding Agreements”) and the Secured Term Loan (as defined below). The Company refers to the Secured Funding Agreements and the Secured Term Loan as the “Financing Agreements.”

Some of the Company’s Financing Agreements are collateralized by (i) assignments of specific loans, preferred equity or a pool of loans held for investment, loans held for sale or real estate owned by the Company, (ii) interests in the subordinated portion of the Company’s securitization debt or (iii) interests in wholly-owned subsidiaries that hold the Company’s loans held for investment or loans held for sale.

The outstanding balances of the Financing Agreements in the table below are presented gross of debt issuance costs. As of June 30, 2026 and December 31, 2025, the outstanding balances and total commitments under the Financing Agreements consisted of the following ($ in thousands):

| Line item | As of June 30, 2026 / Outstanding Balance | As of June 30, 2026 / Total Commitment | As of December 31, 2025 / Outstanding Balance | As of December 31, 2025 / Total Commitment |
| --- | --- | --- | --- | --- |
| Secured Funding Agreements: |  |  |  |  |
| Wells Fargo Facility | $562,962 | $600,000 | $438,911 | $600,000 |
| Citibank Facility | 340,195 | 425,000 | 269,265 | 325,000 |
| CNB Facility | — | 75,000 | — | 75,000 |
| Morgan Stanley Facility | 269,870 | 350,000 | 150,000 | 150,000 |
| Subtotal | $1,173,027 | $1,450,000 | $858,176 | $1,150,000 |
| Secured Term Loan | $90,000 | $90,000 | $90,000 | $90,000 |
| Total | $1,263,027 | $1,540,000 | $948,176 | $1,240,000 |

(1) The Carrying Value of collateral pledged to the Wells Fargo Facility (as defined below) was $851.7 million and $657.1 million as of June 30, 2026 and December 31, 2025, respectively.

(2) In March 2026, the Company exercised each of its two $50.0 million accordion options on the Citibank Facility (as defined below) to increase the maximum commitment from $325.0 million to $425.0 million with payment of an upsize fee. The Carrying Value of collateral pledged to the Citibank Facility was $487.3 million and $420.5 million as of June 30, 2026 and December 31, 2025, respectively.

(3) Amount immediately available under the CNB Facility (as defined below) at any given time can fluctuate based on the fair value of the collateral in the borrowing base that secures the CNB Facility. As of June 30, 2026, there was $51.6 million of immediate availability under the CNB Facility based on the fair value of the collateral in the borrowing base at such time. The amount immediately available under the CNB Facility may be increased to up to $75.0 million by the pledge of additional collateral into the borrowing base in accordance with the CNB Facility agreement.

(4) In January 2026, the Company exercised its $100.0 million accordion option on the Morgan Stanley Facility (as defined below) to increase the maximum commitment from $150.0 million to $250.0 million with payment of an upsize fee. Subsequently, in March 2026, the Company amended the Morgan Stanley Facility to, among other things, increase the maximum commitment from $250.0 million to $350.0 million and include an accordion provision such that the maximum commitment may be increased to up to $400.0 million at the Company’s option, subject to the satisfaction of certain conditions, including payment of an upsize fee. The Carrying Value of collateral pledged to the Morgan Stanley Facility was $402.0 million and $308.5 million as of June 30, 2026 and December 31, 2025, respectively.

(5) Equity interests pledged to the Secured Term Loan (as defined below) were $458.1 million and $478.3 million as of June 30, 2026 and December 31, 2025, respectively.

The Company is the borrower or guarantor under each of the Financing Agreements. Generally, the Company partially offsets interest rate risk by matching the interest index of loans held for investment with the Secured Funding Agreements used to fund them. The Company’s Financing Agreements contain various affirmative and negative covenants, including negative pledges, and provisions regarding events of default that are normal and customary for similar financing arrangements.

Wells Fargo Facility

The Company is party to a master repurchase funding facility with Wells Fargo Bank, National Association (“Wells Fargo”) (the “Wells Fargo Facility”), which allows the Company to borrow up to $600.0 million. Under the Wells Fargo Facility, the Company is permitted to sell, and later repurchase, certain qualifying senior commercial mortgage loans, A-Notes, pari-passu participations in commercial mortgage loans and mezzanine loans under certain circumstances, subject to available collateral approved by Wells Fargo in its sole discretion. The initial maturity date of the Wells Fargo Facility is February 10, 2028, subject to two 12-month extensions, each of which may be exercised at the Company’s option assuming no existing defaults under the Wells Fargo Facility and applicable extension fees being paid, which, if both were exercised, would extend the maturity date of the Wells Fargo Facility to February 10, 2030. Advances under the Wells Fargo Facility accrue interest at a per annum rate equal to the sum of one-month SOFR plus a pricing margin range of 1.50% to 3.75%, subject to certain exceptions.

Citibank Facility

The Company is party to a master repurchase facility with Citibank, N.A. (“Citibank”) (the “Citibank Facility”), which allows the Company to borrow up to $425.0 million. Under the Citibank Facility, the Company is permitted to sell and later repurchase certain qualifying senior commercial mortgage loans and A-Notes approved by Citibank in its sole discretion. The initial maturity date of the Citibank Facility is January 13, 2027, subject to two 12-month extensions, each of which may be exercised at the Company’s option assuming no existing defaults under the Citibank Facility and applicable extension fees being paid, which, if both were exercised, would extend the maturity date of the Citibank Facility to January 13, 2029. Advances under the Citibank Facility accrue interest at a per annum rate equal to the sum of one-month SOFR plus an indicative pricing margin range of 1.50% to 2.10%, subject to certain exceptions. The Company incurs a non-utilization fee of 25 basis points per annum on the average daily positive difference between the maximum advances approved by Citibank and the actual advances outstanding on the Citibank Facility. For both the three and six months ended June 30, 2026, the Company did not incur a non-utilization fee. For the three and six months ended June 30, 2025, the Company incurred a non-utilization fee of $7 thousand and $8 thousand, respectively. The non-utilization fee is included within interest expense in the Company’s consolidated statements of operations.

CNB Facility

The Company is party to a $75.0 million secured revolving funding facility with City National Bank (the “CNB Facility”). The Company is permitted to borrow funds under the CNB Facility to finance investments and for other working capital and general corporate needs. The amount immediately available under the CNB Facility at any given time can fluctuate based on the fair value of the collateral in the borrowing base that secures the CNB Facility. As of June 30, 2026, there was $51.6 million of immediate availability under the CNB Facility based on the fair value of the collateral in the borrowing base at such time. Availability may be increased to up to $75.0 million by the pledge of additional collateral into the borrowing base in accordance with the CNB Facility agreement. In March 2026, the Company amended the CNB Facility to, among other things, extend the maturity date to December 31, 2026. The interest rate on advances under the CNB Facility is a per annum rate equal to the sum of, at the Company’s option, either (a) a SOFR-based rate plus 3.25% or (b) a base rate plus 2.25%, in each case, subject to an interest rate floor. Unless at least 75% of the CNB Facility is used on average, unused commitments under the CNB Facility accrue non-utilization fees at the rate of 0.375% per annum. For the three and six months ended June 30, 2026, the Company incurred a non-utilization fee of $71 thousand and $141 thousand, respectively. For the three and six months ended June 30, 2025, the Company incurred a non-utilization fee of $71 thousand and $141 thousand, respectively. The non-utilization fee is included within interest expense in the Company’s consolidated statements of operations.

Morgan Stanley Facility

The Company is party to a $350.0 million master repurchase and securities contract with Morgan Stanley Bank, N.A. (“Morgan Stanley”) (the “Morgan Stanley Facility”). Under the Morgan Stanley Facility, the Company is permitted to sell, and later repurchase, certain qualifying commercial mortgage loans collateralized by retail, office, mixed-use, multifamily, industrial, hospitality, student housing or self storage properties. Morgan Stanley may approve the mortgage loans that are subject to the Morgan Stanley Facility in its sole discretion. In January 2026, the Company exercised its $100.0 million accordion option on the Morgan Stanley Facility to increase the maximum commitment from $150.0 million to $250.0 million with payment of an upsize fee. Subsequently, in March 2026, the Company amended the Morgan Stanley Facility to, among other things, (1) increase the maximum commitment from $250.0 million to $350.0 million and include an accordion provision such that the maximum commitment may be increased to up to $400.0 million at the Company’s option, subject to the satisfaction of certain conditions, including payment of an upsize fee and (2) extend the initial maturity date to July 16, 2029, subject to one 12-month extension, which may be exercised at the Company’s option assuming no existing defaults under the Morgan Stanley Facility and the applicable extension fee being paid, which, if exercised, would extend the maturity date to July 16, 2030. Advances under the Morgan Stanley Facility generally accrue interest at a per annum rate equal to the sum of one-month SOFR plus a spread ranging from 1.75% to 2.25%, determined by Morgan Stanley, depending upon the mortgage loan sold to Morgan Stanley in the applicable transaction.

Secured Term Loan

The Company and certain of its subsidiaries are party to a $90.0 million Credit and Guaranty Agreement with the lenders referred to therein and Cortland Capital Market Services LLC, as administrative agent and collateral agent for the lenders (the “Secured Term Loan”). The maturity date of the Secured Term Loan is November 12, 2026. The interest rate on advances under the Secured Term Loan are set to the following fixed rates: (i) 4.50% per annum until May 1, 2025 and (ii) after May 1, 2025 through November 12, 2026, the interest rate increases 0.25% every three months.

The total original issue discount and the modification fee on the Secured Term Loan represents a discount to the debt cost to be amortized into interest expense using the effective interest method over the term of the Secured Term Loan. For the three and six months ended June 30, 2026, the per annum effective interest rate of the Secured Term Loan, which is equal to the fixed interest rate plus the accretion of the original issue discount and associated costs, was 6.5% and 6.3%, respectively. For the three and six months ended June 30, 2025, the per annum effective interest rate of the Secured Term Loan was 5.9% and 5.8%, respectively.

#### 7. COMMITMENTS AND CONTINGENCIES

As further discussed in Note 2 to our consolidated financial statements, the impact of the current macroeconomic conditions on the Company’s business is uncertain. As of June 30, 2026, there were no contingencies recorded on the Company’s consolidated balance sheets as a result of such conditions; however, if global market conditions worsen, it could adversely affect the Company’s business, financial condition and results of operations.

As of June 30, 2026 and December 31, 2025, the Company had the following commitments to fund various whole and co-invested senior mortgage loans, subordinated debt investments, as well as preferred equity investments accounted for as loans held for investment ($ in thousands):

| Line item | As of / June 30, 2026 | As of / December 31, 2025 |
| --- | --- | --- |
| Total commitments | $1,925,496 | $1,660,935 |
| Less: funded commitments | (1,840,169) | (1,601,059) |
| Total unfunded commitments | $85,327 | $59,876 |

The timing and amount of future fundings are uncertain as loan funding commitments relate to, among others, construction costs, capital expenditures, leasing costs and interest and carry costs. As such, the timing and amount of fundings depend mainly on the progress and performance of the underlying collateral assets for the Company’s loans and funding requests from borrowers are subject to the Company’s review and approval in accordance with the contractual loan agreements. Certain of the Company’s lenders under its Secured Funding Agreements may be contractually obligated to fund their ratable portion of these loan commitments over time, while others may have some degree of discretion over future loan funding obligations.

The Company from time to time may be a party to litigation relating to claims arising in the normal course of business. As of June 30, 2026, the Company is not aware of any legal claims that could materially impact its business, financial condition or results of operations.

#### 8. STOCKHOLDERS’ EQUITY

Stock Repurchase Program

On July 30, 2025, the Company’s board of directors extended its stock repurchase program of up to $50.0 million (the “Repurchase Program”), which was expected to be in effect until July 31, 2026, or until the approved dollar amount had been used to repurchase shares. On July 28, 2026, the Company’s board of directors further extended the Repurchase Program of up to $50.0 million, which is expected to be in effect until July 31, 2027, or until the approved dollar amount has been used to repurchase shares. Pursuant to the Repurchase Program, the Company may repurchase shares of its common stock in amounts, at prices and at such times as it deems appropriate, subject to market conditions and other considerations, including all applicable legal requirements. Repurchases may include purchases on the open market or privately negotiated transactions, under Rule 10b5-1 trading plans, under accelerated share repurchase programs, in tender offers and otherwise. The Repurchase Program does not obligate the Company to acquire any particular amount of shares of its common stock and may be modified or suspended at any time at its discretion. During the three and six months ended June 30, 2026 and 2025, the Company did not repurchase any shares through the Repurchase Program.

Common Stock

There were no shares of the Company’s common stock issued in public or private offerings for the three and six months ended June 30, 2026 and 2025. See “Equity Incentive Plan” below for shares issued under the Equity Incentive Plan described below.

Equity Incentive Plan

On April 23, 2012, the Company adopted an equity incentive plan, which was amended and restated in June 2018 and further amended in May 2022 (as further amended, the “Amended and Restated 2012 Equity Incentive Plan”). In April 2024, the Company’s board of directors approved, and in May 2024, the Company’s stockholders approved, the second amendment to the Amended and Restated 2012 Equity Incentive Plan, which increased the total number of shares of common stock the Company may grant thereunder to 5,015,000 shares. Pursuant to the Amended and Restated 2012 Equity Incentive Plan, as amended by the second amendment, the Company may grant awards consisting of restricted shares of the Company’s common stock, restricted stock units (“RSUs”) and/or other equity-based awards to the Company’s outside directors, employees of the Manager, officers, ACREM and other eligible awardees under the plan. Any restricted shares of the Company’s common stock and RSUs are accounted for under FASB ASC Topic 718, Compensation—Stock Compensation, resulting in stock-based compensation expense equal to the grant date fair value of the underlying restricted shares of common stock or RSUs.

Restricted stock and RSU grants generally vest ratably over a one to three-year period from the vesting start date. The grantee receives additional compensation for each outstanding restricted stock or RSU grant, classified as dividends paid, equal to the per-share dividends received by the Company’s common stockholders.

The following tables summarize the (i) non-vested shares of restricted stock and RSUs and (ii) vesting schedule of shares of restricted stock and RSUs for the Company’s directors and officers and employees of the Manager as of June 30, 2026:

Schedule of Non-Vested Share and Share Equivalents

| Line item | Restricted Stock Grants—Directors | RSUs—Officers and Employees of the Manager | Total |
| --- | --- | --- | --- |
| Balance at December 31, 2025 | 74,088 | 1,256,271 | 1,330,359 |
| Granted | 113,274 | — | 113,274 |
| Vested | (74,088) | (341,386) | (415,474) |
| Forfeited | — | (7,332) | (7,332) |
| Balance at June 30, 2026 | 113,274 | 907,553 | 1,020,827 |

Future Anticipated Vesting Schedule

| Line item | Restricted Stock Grants—Directors | RSUs—Officers and Employees of the Manager | Total |
| --- | --- | --- | --- |
| Remainder of 2026 | 56,640 | 4,167 | 60,807 |
| 2027 | 56,634 | 420,677 | 477,311 |
| 2028 | — | 304,546 | 304,546 |
| 2029 | — | 178,163 | 178,163 |
| 2030 | — | — | — |
| Total | 113,274 | 907,553 | 1,020,827 |

9. EARNINGS PER SHARE

The following information sets forth the computations of basic and diluted earnings (loss) per common share for the three and six months ended June 30, 2026 and 2025 ($ in thousands, except share and per share data):

| Line item | For the Three Months Ended June 30, 2026 | For the Three Months Ended June 30, 2025 | For the Six Months Ended June 30, 2026 | For the Six Months Ended June 30, 2025 |
| --- | --- | --- | --- | --- |
| Net income (loss) attributable to common stockholders | $4,383 | $(11,035) | $(5,223) | $(1,690) |
| Divided by: |  |  |  |  |
| Basic weighted average shares of common stock outstanding: | 55,367,375 | 54,856,949 | 55,344,923 | 54,842,959 |
| Weighted average non-vested restricted stock and RSUs (1) | 987,613 | — | — | — |
| Diluted weighted average shares of common stock outstanding: | 56,354,988 | 54,856,949 | 55,344,923 | 54,842,959 |
| Basic earnings (loss) per common share | $0.08 | $(0.20) | $(0.09) | $(0.03) |
| Diluted earnings (loss) per common share | $0.08 | $(0.20) | $(0.09) | $(0.03) |

(1) For the six months ended June 30, 2026, the weighted average non-vested restricted stock and RSUs of 974,133 were excluded from the computation of diluted earnings (loss) per common share as the impact of including those shares would be anti-dilutive. For the three and six months ended June 30, 2025, the weighted average non-vested restricted stock and RSUs of 912,326 and 889,299, respectively, were excluded from the computation of diluted earnings (loss) per common share as the impact of including those shares would be anti-dilutive.

10. INCOME TAX

The Company wholly owns ACRC 2017-FL3 TRS LLC, which is a taxable REIT subsidiary (“TRS”) formed to hold a portion of CLO securitizations, including a portion that generated excess inclusion income. The Company also wholly owns ACRC Lender TRS LLC, which is a TRS formed to issue and hold certain loans intended for sale. Additionally, the Company wholly owns ACRC WM Tenant LLC, a TRS initially formed to lease from an affiliate a hotel property classified as real estate owned acquired on March 8, 2019, which was sold on March 1, 2022.

The income tax provision for the Company and the TRSs consisted of the following for the three and six months ended June 30, 2026 and 2025 ($ in thousands):

| Line item | For the Three Months Ended June 30, 2026 | For the Three Months Ended June 30, 2025 | For the Six Months Ended June 30, 2026 | For the Six Months Ended June 30, 2025 |
| --- | --- | --- | --- | --- |
| Current | $139 | — | $166 | $282 |
| Deferred | (1) | — | 3 | (1) |
| Excise tax | — | — | — | — |
| Total income tax expense (benefit), including excise tax | $138 | — | $169 | $281 |

For the three and six months ended June 30, 2026 and 2025, the Company did not incur any expense for U.S. federal excise tax. Excise tax represents a 4% tax on the sum of a portion of the Company’s ordinary income and net capital gains not distributed during the calendar year (including any distribution declared in the fourth quarter and paid the following January) plus any prior year shortfall. If it is determined that an excise tax liability exists for the current tax year, the Company will accrue excise tax on estimated excess taxable income as such taxable income is earned. The quarterly expense is calculated in accordance with applicable tax regulations.

The TRSs recognize interest and penalties related to unrecognized tax benefits within income tax expense in the Company’s consolidated statements of operations. Accrued interest and penalties, if any, are included within other liabilities in the Company’s consolidated balance sheets.

As of June 30, 2026, tax years 2022 through 2026 remain subject to examination by taxing authorities. The Company does not have any unrecognized tax benefits and the Company does not expect that to change in the next 12 months.

11. FAIR VALUE

The Company follows FASB ASC Topic 820-10, Fair Value Measurement (“ASC 820-10”), which expands the application of fair value accounting. ASC 820-10 defines fair value, establishes a framework for measuring fair value in accordance with GAAP and expands disclosure requirements for fair value measurements. ASC 820-10 determines fair value to be the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants on the measurement date. ASC 820-10 specifies a hierarchy of valuation techniques based on the inputs used in measuring fair value.

In accordance with ASC 820-10, the inputs used to measure fair value are summarized in the three broad levels listed below:

- Level 1—Quoted prices in active markets for identical assets or liabilities.
- Level 2—Prices are determined using other significant observable inputs. Observable inputs are inputs that other market participants would use in pricing a security. These may include quoted prices for similar securities, interest rates, prepayment rates, credit risk and others.
- Level 3—Prices are determined using significant unobservable inputs. In situations where quoted prices or observable inputs are unavailable (for example, when there is little or no market activity for an investment at the end of the period), unobservable inputs may be used.

GAAP requires disclosure of fair value information about financial and nonfinancial assets and liabilities, whether or not recognized in the financial statements, for which it is practical to estimate the value. In cases where quoted market prices are not available, fair values are based upon the application of discount rates to estimated future cash flows using market yields, or other valuation methodologies. Any changes to the valuation methodology will be reviewed by the Company’s management to ensure the changes are appropriate. The methods used may produce a fair value calculation that is not indicative of net realizable value or reflective of future fair values. Furthermore, while the Company anticipates that the valuation methods are appropriate and consistent with other market participants, the use of different methodologies, or assumptions, to determine the fair value of certain financial and nonfinancial assets and liabilities could result in a different estimate of fair value at the reporting date. The Company uses inputs that are current as of the measurement date, which may fall within periods of market dislocation, during which price transparency may be reduced.

Recurring Fair Value Measurements

As of June 30, 2026 and December 31, 2025, the Company did not have any financial or nonfinancial assets or liabilities required to be recorded at fair value on a recurring basis.

Nonrecurring Fair Value Measurements

Real Estate Owned

The Company is required to record real estate owned, a nonfinancial asset, at fair value on a nonrecurring basis in accordance with GAAP. Real estate owned consists of a multi-building office property and a mixed-use property that were acquired by the Company on September 19, 2024 and September 8, 2023 through a deed in lieu of foreclosure and a consensual foreclosure, respectively. See Note 5 included in these consolidated financial statements for more information on real estate owned. Real estate owned is recorded at fair value at acquisition using Level 3 inputs and is evaluated for indicators of impairment on a quarterly basis. Real estate owned is considered impaired when the sum of estimated future undiscounted cash flows expected to be generated by the real estate owned over the estimated remaining holding period is less than the carrying amount of such real estate owned. Cash flows include operating cash flows and anticipated capital proceeds generated by the real estate owned. An impairment charge is recorded equal to the excess of the carrying amount of the real estate owned over the fair value.

The multi-building office property acquired on September 19, 2024 was classified as real estate owned held for investment in the Company’s consolidated balance sheets as of the acquisition date and was carried at its estimated fair value at acquisition and was presented net of accumulated depreciation or amortization and impairment charges. The fair value of the office property at acquisition was estimated using a third-party appraisal, which utilized standard industry valuation techniques such as the income and market approach. When determining the fair value of the office property, certain assumptions are made including, but not limited to: (1) projected operating cash flows, including factors such as property operating expenses and re-leasing assumptions that take into account the number of months to re-lease, market rental revenue and required tenant improvements; and (2) projected cash flows from the eventual disposition of the office property based upon the Company’s estimation of a capitalization rate, discount rates and comparable selling prices in the market. The fair value of the office property was estimated using significant unobservable inputs, which considered various comparable properties that were valued using capitalization rates ranging from 6.4% to 11.0% and discount rates ranging from 14.0% to 16.0%.

During the three months ended March 31, 2026, the multi-building office property was reclassified to real estate owned held for sale in the Company’s consolidated balance sheets and is carried at the lower of its carrying amount or fair value less costs to sell. Upon reclassification, the carrying amount of the multi-building office property was lower than the estimated fair value less costs to sell. As such, the Company has continued to recognize the multi-building office property at its carrying amount in the Company’s consolidated balance sheets and no impairment loss related to the planned sale of the multi-building office property has been recognized in the Company’s consolidated statements of operations for the six months ended June 30, 2026. The fair value of the multi-building office property upon reclassification to held for sale was determined using the estimated net proceeds available from a potential sale of the property.

The mixed-use property acquired on September 8, 2023 is classified as real estate owned held for investment in the Company’s consolidated balance sheets as of the acquisition date and is carried at its estimated fair value at acquisition and is presented net of accumulated depreciation or amortization and impairment charges. The fair value of the mixed-use property at acquisition was estimated using a third-party appraisal, which utilized standard industry valuation techniques such as the income and market approach. When determining the fair value of the mixed-use property, certain assumptions are made including, but not limited to: (1) projected operating cash flows, including factors such as property operating expenses and re-leasing assumptions that take into account the number of months to re-lease, market rental revenue and required tenant improvements; and (2) projected cash flows from the eventual disposition of the mixed-use property based upon the Company’s estimation of a capitalization rate, discount rates and comparable selling prices in the market. The fair value of the mixed-use property was estimated using significant unobservable inputs, which considered various comparable properties that were valued using capitalization rates ranging from 6.4% to 8.3% and discount rates ranging from 8.0% to 9.5%. No impairment charges have been recognized for the mixed-use property as of June 30, 2026.

Financial Assets and Liabilities Not Measured at Fair Value

As of June 30, 2026 and December 31, 2025, the carrying amounts and fair values of the Company’s financial assets and liabilities recorded at cost are as follows ($ in thousands):

| Line item | Level in Fair Value Hierarchy | As of / June 30, 2026 / Carrying Amount (1) | As of / June 30, 2026 / Fair Value | As of / December 31, 2025 / Carrying Amount (1) | As of / December 31, 2025 / Fair Value |
| --- | --- | --- | --- | --- | --- |
| Financial assets: |  |  |  |  |  |
| Loans held for investment | 3 | $1,748,835 | $1,621,760 | $1,528,806 | $1,409,982 |
| Financial liabilities: |  |  |  |  |  |
| Secured funding agreements | 2 | $1,173,027 | $1,173,027 | $858,176 | $858,176 |
| Secured term loan | 3 | 89,722 | 89,422 | 89,360 | 88,686 |
| Collateralized loan obligation securitization debt (consolidated VIEs) | 2 | — | — | 99,921 | 95,766 |

(1) Loans held for investment are presented at Carrying Value, which excludes the CECL Reserve.

The carrying amounts of cash and cash equivalents, restricted cash, interest receivable, due to affiliate liability and accrued expenses, which are all categorized as Level 2 within the fair value hierarchy, approximate their fair values due to their short-term nature.

Loans held for investment are recorded at cost, net of unamortized purchase discounts, deferred loan fees and origination costs and cost-recovery proceeds. To determine the fair value of the collateral, the Company may employ different approaches depending on the type of collateral. The Company determined the fair value of loans held for investment based on a discounted cash flow methodology (1) for risk rated “1”, “2”, or “3” loans, on a portfolio basis and (b) for risk rated “4” or “5” loans, on an asset-by-asset basis, in each case taking into consideration various factors including capitalization rates, discount rates, leasing, occupancy rates, availability and cost of financing, exit plan, sponsorship, actions of other lenders, and comparable selling prices in the market. The Secured Funding Agreements are recorded at outstanding principal, which is the Company’s best estimate of the fair value. The Company determined the fair value of the Secured Term Loan and collateralized loan obligation (“CLO”) securitization debt based on a discounted cash flow methodology, taking into consideration various factors including discount rates, actions of other lenders and comparable market quotes and recent trades for similar products.

12. RELATED PARTY TRANSACTIONS

Management Agreement

The Company is party to an Amended and Restated Management Agreement under which ACREM, subject to the supervision and oversight of the Company’s board of directors, is responsible for, among other duties, (a) performing all of the Company’s day-to-day functions, (b) determining the Company’s investment strategy and guidelines in conjunction with the Company’s board of directors, (c) sourcing, analyzing and executing investments, asset sales and financing, and (d) performing portfolio management duties. In addition, ACREM has an Investment Committee that oversees compliance with the Company’s investment strategy and guidelines, loans held for investment portfolio holdings and financing strategy.

In exchange for its services, ACREM is entitled to receive a base management fee, an incentive fee and expense reimbursements. In addition, ACREM and its personnel may receive grants of equity-based awards pursuant to the Company’s Amended and Restated 2012 Equity Incentive Plan and a termination fee, if applicable.

The base management fee is equal to 1.5% of the Company’s stockholders’ equity per annum, which is calculated and payable quarterly in arrears in cash. For purposes of calculating the base management fee, stockholders’ equity means: (a) the sum of (i) the net proceeds from all issuances of the Company’s equity securities since inception (allocated on a pro-rata daily basis for such issuances during the fiscal quarter of any such issuance), plus (ii) the Company’s retained earnings at the end of the most recently completed fiscal quarter determined in accordance with GAAP (without taking into account any non-cash equity compensation expense incurred in current or prior periods); less (b) (x) any amount that the Company has paid to repurchase the Company’s common stock since inception, (y) any unrealized gains and losses and other non-cash items that have impacted stockholders’ equity as reported in the Company’s consolidated financial statements prepared in accordance with GAAP, and (z) one-time events pursuant to changes in GAAP, and certain non-cash items not otherwise described above, in each case after discussions between ACREM and the Company’s independent directors and approval by a majority of the Company’s independent directors. As a result, the Company’s stockholders’ equity, for purposes of calculating the management fee, could be greater or less than the amount of stockholders’ equity shown in the Company’s consolidated financial statements.

The incentive fee is an amount, not less than zero, equal to the difference between: (a) the product of (i) 20% and (ii) the difference between (A) the Company’s Core Earnings (as defined below) for the previous 12-month period, and (B) the product of (1) the weighted average of the issue price per share of the Company’s common stock of all of the Company’s public offerings of common stock multiplied by the weighted average number of all shares of common stock outstanding including any restricted shares of the Company’s common stock, RSUs, or any shares of the Company’s common stock not yet issued, but underlying other awards granted under the Company’s Amended and Restated 2012 Equity Incentive Plan (see Note 8 included in these consolidated financial statements) in the previous 12-month period, and (2) 8%; and (b) the sum of any incentive fees earned by ACREM with respect to the first three fiscal quarters of such previous 12-month period; provided, however, that no incentive fee is payable with respect to any fiscal quarter unless cumulative Core Earnings for the 12 most recently completed fiscal quarters is greater than zero. “Core Earnings” is defined in the Management Agreement as net income (loss) computed in accordance with GAAP, excluding non-cash equity compensation expense, the incentive fee, depreciation and amortization (to the extent that any of the Company’s target investments are structured as debt and the Company forecloses on any properties underlying such debt), any unrealized gains, losses or other non-cash items recorded in net income (loss) for the period, regardless of whether such items are included in other comprehensive income (loss), or in net income (loss), and one-time events pursuant to changes in GAAP and certain non-cash charges after discussions between ACREM and the Company’s independent directors and after approval by a majority of the Company’s independent directors. Core Earnings is defined in the Management Agreement and is used to calculate the incentive fees the Company pays to ACREM. For the three and six months ended June 30, 2026 and 2025, the Company did not incur any incentive fees.

The Company reimburses ACREM at cost for operating expenses that ACREM incurs on the Company’s behalf, including expenses relating to legal, financial, accounting, servicing, due diligence and other services, expenses in connection with the origination and financing of the Company’s investments, communications with the Company’s stockholders, information technology systems, software and data services used for the Company, travel, complying with legal and regulatory requirements, taxes, insurance maintained for the benefit of the Company as well as all other expenses actually incurred by ACREM that are reasonably necessary for the performance by ACREM of its duties and functions under the Management Agreement. Ares Management, from time to time, incurs fees, costs and expenses on behalf of more than one investment vehicle. To the extent such fees, costs and expenses are incurred for the account or benefit of more than one fund, each such investment vehicle, including the Company, will typically bear an allocable portion of any such fees, costs and expenses in proportion to the size of its investment in the activity or entity to which such expense relates (subject to the terms of each fund’s governing documents) or in such other manner as Ares Management considers fair and equitable under the circumstances, such as the relative fund size or capital available to be invested by such investment vehicles. Where an investment vehicle’s

governing documents do not permit the payment of a particular expense, Ares Management will generally pay such investment vehicle’s allocable portion of such expense. In addition, the Company is responsible for its proportionate share of certain fees and expenses, including due diligence costs, as determined by ACREM and Ares Management, including legal, accounting and financial advisor fees and related costs, incurred in connection with evaluating and consummating investment opportunities, regardless of whether such transactions are ultimately consummated by the parties thereto.

The Company will not reimburse ACREM for the salaries and other compensation of its personnel, except for the allocable share of the salaries and other compensation of the Company’s (a) Chief Financial Officer, based on the percentage of his time spent on the Company’s affairs and (b) other corporate finance, tax, accounting, internal audit, legal, risk management, operations, compliance and other non-investment professional personnel of ACREM or its affiliates who spend all or a portion of their time managing the Company’s affairs based on the percentage of their time spent on the Company’s affairs. The Company is also required to pay its pro-rata portion of rent, telephone, utilities, office furniture, equipment, machinery and other office, internal and overhead expenses of ACREM and its affiliates that are required for the Company’s operations.

Certain of the Company’s subsidiaries, along with the Company’s lenders under certain of the Company’s Secured Funding Agreements, have entered into various servicing agreements with ACREM’s subsidiary servicer, Ares Commercial Real Estate Servicer LLC (“ACRES”). The Company’s Manager will specially service, as needed, certain of the Company’s investments. ACRES has agreed that no servicing fees pursuant to these servicing agreements would be charged to the Company or its subsidiaries by ACRES or the Manager for so long as the Management Agreement remains in effect, but that ACRES will continue to receive reimbursement for overhead related to servicing and operational activities pursuant to the terms of the Management Agreement.

The term of the Management Agreement ends on April 25, 2027, with automatic one-year renewal terms. Except under limited circumstances, upon a termination of the Management Agreement, the Company will pay ACREM a termination fee equal to three times the average annual base management fee and incentive fee received by ACREM during the 24-month period immediately preceding the most recently completed fiscal quarter prior to the date of termination, each as described above.

The following table summarizes the related party costs incurred by the Company for the three and six months ended June 30, 2026 and 2025, and amounts payable to the Company’s Manager as of June 30, 2026 and December 31, 2025 ($ in thousands):

| Line item | Incurred / For the Three Months Ended June 30, 2026 | Incurred / For the Three Months Ended June 30, 2025 | Incurred / For the Six Months Ended June 30, 2026 | Incurred / For the Six Months Ended June 30, 2025 | As of / June 30, 2026 | December 31, 2025 |
| --- | --- | --- | --- | --- | --- | --- |
| Affiliate Payments |  |  |  |  |  |  |
| Management fees | $2,394 | $2,430 | $4,794 | $4,997 | $2,394 | $2,420 |
| Incentive fees | — | — | — | — | — | — |
| General and administrative expenses | 853 | 1,024 | 1,639 | 2,027 | 1,794 | 1,641 |
| Direct costs (1) | 11 | 29 | 59 | 56 | 11 | — |
| Total | $3,258 | $3,483 | $6,492 | $7,080 | $4,199 | $4,061 |

(1) For the three and six months ended June 30, 2026 and 2025, direct costs incurred are included within general and administrative expenses in the Company’s consolidated statements of operations.

Investments in Loans

From time to time, the Company co-invests with other investment vehicles managed by Ares Management or its affiliates and their portfolio companies, including by means of splitting investments, participating in investments or other means of syndication of investments. For such co-investments, the Company may act as the administrative agent for the holders of such investments provided that the Company maintains a majority of the aggregate investment. No fees will be received by the Company for performing services as administrative agent with respect to co-investments. The Company is responsible for its pro-rata share of costs and expenses for such co-investments, including due diligence costs for transactions which fail to close. The Company’s investment in such co-investments is made on a pari-passu basis with the other Ares managed investment vehicles and the Company is not obligated to provide, nor has it provided, any financial support to the other Ares managed investment vehicles. As such, the Company’s risk is limited to the carrying amount of its investment and the Company recognizes only the carrying amount of its investment in its consolidated balance sheets. Such investments may raise potential conflicts of interest between the Company and such other Ares managed investment vehicles due to differing investment goals and liquidity needs, and such other Ares managed investment vehicles may take actions that are adverse to the Company's interests, including, but not limited to, during a work-out, restructuring or insolvency proceeding or similar matter occurring with respect to such investment. As of June 30, 2026 and December 31, 2025, the total outstanding principal balance for co-investments held by the Company was $853.4 million and $524.8 million, respectively.

Loan Acquisitions from or Dispositions to Affiliates

The Company or one or more affiliates of the Company’s Manager may originate commercial real estate loans, which may be made available for purchase by other investment vehicles, including the Company and/or other Ares Management managed investment vehicles, as applicable. From time to time, the Company may purchase or sell such commercial real estate loans from or to affiliates of the Company’s Manager. Although the Company’s Manager will approve the purchase and sale of such loans only on terms, including the consideration to be paid, that are determined by the Company’s Manager in good faith to be appropriate for the Company and provided that the Company has sufficient liquidity, the interests of the Company’s Manager could be in conflict with those of the Company. The Company is not obligated to purchase any loans originated by affiliates of the Company’s Manager or sell any loans originated by the Company to affiliates of the Manager. In addition, from time to time, the Company may purchase or sell loans, including participations in loans, from or to other Ares Management managed investment vehicles. Loans purchased or sold by the Company from or to affiliates of the Company’s Manager or other Ares Management managed investment vehicles are purchased or sold at fair value as determined by an independent third-party valuation expert and are subject to approval by a majority of the Company’s independent directors. No loans were purchased or sold by the Company from or to affiliates of the Company’s Manager or other Ares Management managed investment vehicles for the three and six months ended June 30, 2026 and 2025, except as disclosed below.

In June 2026, the Company sold a $68.5 million portion of a senior mortgage loan on a retail property located in California to an Ares Management managed investment vehicle. At the time of the sale, the outstanding principal balance of the portion of the loan that was sold was $61.4 million, which was classified as held for sale in the Company’s consolidated balance sheets. The portion of the loan was sold at fair value, which was equal to the Company’s carrying amount, and no gain or loss was recognized on the sale.

13. DIVIDENDS AND DISTRIBUTIONS

The following table summarizes the Company’s dividends declared during the six months ended June 30, 2026 and 2025 ($ in thousands, except per share data):

| Date Declared | Record Date | Payment Date | Per Share Amount | Total Amount |
| --- | --- | --- | --- | --- |
| May 7, 2026 | June 30, 2026 | July 15, 2026 | $0.15 | $8,458 |
| February 10, 2026 | March 31, 2026 | April 15, 2026 | 0.15 | 8,442 |
| Total cash dividends declared for the six months ended June 30, 2026 |  |  | $0.30 | $16,900 |
| May 7, 2025 | June 30, 2025 | July 15, 2025 | $0.15 | $8,368 |
| February 12, 2025 | March 31, 2025 | April 15, 2025 | 0.15 | 8,354 |
| Total cash dividends declared for the six months ended June 30, 2025 |  |  | $0.30 | $16,722 |

14. VARIABLE INTEREST ENTITIES

Consolidated VIEs

As discussed in Note 2, the Company evaluates all of its investments and other interests in entities for consolidation, including its former investment in the FL4 CLO Securitization (as defined below), which was considered to be a variable interest in a VIE.

FL4 CLO Securitization

On January 28, 2021, ACRE Commercial Mortgage 2021-FL4 Ltd. (the “FL4 Issuer”) and ACRE Commercial Mortgage 2021-FL4 LLC (the “FL4 Co-Issuer”), both wholly-owned indirect subsidiaries of the Company, entered into an Indenture (the “FL4 Indenture”) with ACRC Lender LLC, a wholly-owned subsidiary of the Company (the “Seller”), as advancing agent, Wells Fargo Bank, National Association, as note administrator, and Wilmington Trust, National Association, as trustee, which governed the issuance of approximately $603.0 million principal balance secured floating rate notes (the “FL4 Notes”) and $64.3 million of preferred equity in the FL4 Issuer (the “FL4 CLO Securitization”). For U.S. federal income tax purposes, the FL4 Issuer and FL4 Co-Issuer are disregarded entities.

The sale of assets to the FL4 Issuer was governed by a Mortgage Asset Purchase Agreement between the Seller and the FL4 Issuer, and acknowledged by the Company solely for purposes of confirming its status as a REIT, in which the Seller made certain customary representations, warranties and covenants.

In connection with the FL4 CLO Securitization, the FL4 Issuer and FL4 Co-Issuer offered and issued the following classes of FL4 Notes to third party investors: Class A, Class A-S, Class B, Class C, Class D and Class E Notes (collectively, the “FL4 Offered Notes”). A wholly-owned subsidiary of the Company retained approximately $62.5 million of the FL4 Notes and all of the $64.3 million of preferred equity in the FL4 Issuer, which totaled $126.8 million. The Company, as the holder of the subordinated FL4 Notes and all of the preferred equity in the FL4 Issuer, had the obligation to absorb losses of the FL4 CLO Securitization, since the Company had a first loss position in the capital structure of the FL4 CLO Securitization. On January 20, 2026, the Company exercised its redemption option under the FL4 CLO Securitization, and in connection therewith, exchanged its remaining FL4 Notes and preferred equity in the FL4 Issuer for the remaining mortgage loans and real estate owned held by the FL4 Issuer. As of December 31, 2025, the FL4 Notes were collateralized by interests in a pool of four mortgage assets having a total principal balance of $138.9 million that were closed by a wholly-owned subsidiary of the Company and $52.6 million of real estate owned related to an office property, which had collateralized a previous mortgage asset, and was acquired in September 2024 through a deed in lieu of foreclosure. During the three and six months ended June 30, 2025, the Company paid down $14.4 million and $14.5 million of the FL4 Offered Notes, respectively. As all of the FL4 Notes were repaid in full at par on January 20, 2026, the Company did not pay down any of the FL4 Offered Notes during the three months ended June 30, 2026. During the six months ended June 30, 2026, the Company paid down $99.9 million of the FL4 Offered Notes. As of June 30, 2026, all of the FL4 Notes of the FL4 Issuer held by third parties had been repaid in full at par.

As the directing holder of the FL4 CLO Securitization, the Company had the ability to direct activities that could significantly impact the FL4 CLO Securitization’s economic performance. ACRES was designated as special servicer of the FL4 CLO Securitization and had the power to direct activities during the loan workout process on defaulted and delinquent loans, which is the activity that most significantly impacted the FL4 CLO Securitization’s economic performance. ACRES did not waive the special servicing fee, and the Company paid its overhead costs. If an unrelated third party had the right to unilaterally remove the special servicer, then the Company would not have had the power to direct the activities that most significantly impacted the FL4 CLO Securitization’s economic performance. In addition, there were no substantive kick-out rights of any unrelated third party to remove the special servicer without cause. The Company’s subsidiaries, as directing holders, had the ability to remove the special servicer without cause. Based on these factors, the Company was determined to be the primary beneficiary of the FL4 CLO Securitization; thus, the FL4 CLO Securitization was consolidated into the Company’s consolidated financial statements in accordance with FASB ASC Topic 810 and was structured as a pass through entity that received principal and interest on the underlying collateral and distributed those payments to the note holders, as applicable. The assets and other instruments held by the FL4 CLO Securitization were restricted and could only be used to fulfill the obligations of the FL4 CLO Securitization. Additionally, the obligations of the FL4 CLO Securitization did not have any recourse to the general credit of any other consolidated entities, nor to the Company as the primary beneficiary.

The inclusion of the assets and liabilities of the FL4 CLO Securitization of which the Company was deemed the primary beneficiary had no economic effect on the Company. The Company’s exposure to the obligations of the FL4 CLO Securitization were generally limited to its investment in the entity. The Company was not obligated to provide, nor did it provide, any financial support for the consolidated structure. As such, the risk associated with the Company’s involvement in the FL4 CLO Securitization was limited to the carrying amount of its investment.

Non-consolidated VIEs

The Company evaluated its senior mortgage loan investment that is collateralized by a residential condominium property located in New York, and it was determined to be an interest in a VIE. However, the Company was not deemed to be the primary beneficiary. The Company’s exposure to the obligations of the VIE is generally limited to its investment and the Company is not obligated to provide, nor has it provided, any financial support to the VIE. As such, the risk associated with the Company’s involvement in the VIE is limited to the carrying amount of its investment. As of June 30, 2026, the Company’s maximum risk of loss was $140.2 million, which represents the Carrying Value of its investment in the VIE.

15. SEGMENT INFORMATION

As described in Note 1 included in these consolidated financial statements, the Company operates as a single reportable segment, which derives its revenues by directly originating and managing a diversified portfolio of CRE debt-related investments. The Company manages its business activities on a consolidated basis and the accounting policies of the segment are the same as those described in Note 2 included in these consolidated financial statements. The Company’s Chief Operating Decision Maker (“CODM”) is the chief executive officer.

The CODM assesses performance for the segment and decides how to allocate resources based on net income (loss) attributable to common stockholders. The measure of segment assets is reported in the consolidated balance sheets as total assets.

The following table summarizes the information about segment net income (loss) and significant segment expenses for the three and six months ended June 30, 2026 and 2025 ($ in thousands):

| Line item | For the Three Months Ended June 30, 2026 | For the Three Months Ended June 30, 2025 | For the Six Months Ended June 30, 2026 | For the Six Months Ended June 30, 2025 |
| --- | --- | --- | --- | --- |
| Net interest margin | $8,572 | $7,016 | $16,117 | $16,307 |
| Revenue from real estate owned | 5,784 | 5,549 | 11,699 | 11,206 |
| Total revenue | 14,356 | 12,565 | 27,816 | 27,513 |
| Expenses from real estate owned | (3,301) | (4,628) | (6,435) | (9,123) |
| (Provision for) reversal of current expected credit losses, net | (865) | 20,150 | (12,003) | 25,490 |
| Realized losses on loans | — | (33,000) | (3,340) | (33,000) |
| Other segment items (1) | (5,807) | (6,122) | (11,261) | (12,570) |
| Segment net income (loss) | 4,383 | (11,035) | (5,223) | (1,690) |
| Adjustments and reconciling items | — | — | — | — |
| Net income (loss) attributable to common stockholders | $4,383 | $(11,035) | $(5,223) | $(1,690) |

(1) Other segment items included in Segment net income (loss) include, as applicable, management and incentive fees to affiliate, professional fees, general and administrative expenses, general and administrative expenses reimbursed to affiliate and income tax expense (benefit), including excise tax.

16. SUBSEQUENT EVENTS

The Company’s management has evaluated subsequent events through the date of issuance of the consolidated financial statements included herein. There have been no subsequent events that occurred during such period that would require disclosure in this quarterly report on Form 10-Q or would be required to be recognized in the consolidated financial statements as of and for the three months ended June 30, 2026, except as disclosed below.

The Company’s board of directors declared a regular cash dividend of $0.15 per common share for the third quarter of 2026. The third quarter 2026 dividend will be payable on October 15, 2026 to common stockholders of record as of September 30, 2026.

## Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

Overview

We are a specialty finance company primarily engaged in directly originating and investing in commercial real estate (“CRE”) loans and related investments. We are externally managed by ACREM, a subsidiary of Ares Management Corporation (NYSE: ARES) (“Ares Management”), a publicly traded, leading global alternative investment manager, pursuant to the terms of the amended and restated management agreement dated July 26, 2022, between us and our Manager (the “Management Agreement”). From the commencement of our operations in late 2011, we have been primarily focused on directly originating and managing a diversified portfolio of CRE debt-related investments for our own account.

We were formed and commenced operations in late 2011. We are a Maryland corporation and completed our initial public offering in May 2012. We have elected and qualified to be taxed as a REIT for United States federal income tax purposes under the Internal Revenue Code of 1986, as amended (the “Code”), commencing with our taxable year ended December 31, 2012. We generally will not be subject to United States federal income taxes on our REIT taxable income as long as we annually distribute to stockholders an amount at least equal to our REIT taxable income prior to the deduction for dividends paid and comply with various other requirements as a REIT. We also operate our business in a manner that is intended to permit us to maintain our exemption from registration under the 1940 Act.

Developments During the Second Quarter of 2026:

- We closed a $25.0 million senior mortgage loan as part of a co-investment on a multifamily property located in Tennessee.
- We closed a $69.7 million senior mortgage loan as part of a co-investment on a portfolio of self storage properties located in various states.
- We closed a $35.0 million senior mortgage loan as part of a co-investment on a hotel property located in California.
- We sold a $68.5 million portion of a $143.5 million senior mortgage loan as part of a co-investment on a retail property located in California. At the time of the sale, the outstanding principal balance of the portion of the loan that was sold was $61.4 million, which was classified as held for sale in our consolidated balance sheets. The portion of the loan was sold at fair value, which was equal to our carrying amount, and no gain or loss was recognized on the sale. We continue to hold the remaining $75.0 million portion of the senior mortgage loan, which had an outstanding principal balance of $67.3 million as of June 30, 2026 and is classified as held for investment.

Trends Affecting Our Business

During the second quarter of 2026, the U.S. economy continued to expand, supported by continued consumer spending with moderating expectations for U.S. gross domestic product growth and low levels of unemployment amidst heightened geopolitical tensions. During this time, the commercial real estate market exhibited stable to moderating conditions. Specifically, individual property transaction volumes slowed in the second quarter while broad market indices demonstrated flat to increasing commercial real estate values.

Aiding valuations, new construction starts remained near or at 10-year lows across multifamily, industrial, retail and office property types and lending markets remained supportive given increased activity from capital markets and banks. During the quarter, the Federal Reserve held interest rates steady and restated its commitment towards its inflation goals, which may result in future monetary policy actions. There is no certainty that there will be a change in interest rates or of the magnitude or pace of potential changes.

Rising operating costs, such as property insurance and raw material costs for property development and improvements, placed pressure on cash flow performance across many real estate property types. Although certain markets are showing a recovery, office properties nationally continue to experience challenges driven by remote work and elevated costs to operate, improve or repurpose these office properties. These factors have largely resulted in lower demand for office space and have driven elevated levels of vacancy rates and default rates. Offsetting some of these challenges, there has been a significant decline in new commercial real estate development that began in 2023 and has continued benefitting existing in-demand property types. Ultimately, this lack of new future inventory may result in a shortage of contemporary, in-demand properties in the years to come, furthering the disparity between supply and demand dynamics. In addition, there is a significant amount of unspent capital targeting commercial real estate properties that could support values and elevate transaction activities.

Uncertainty around U.S. economic and foreign policies, international relations and their potential impact to the U.S. economy has increased risk. Should the risks from these factors become more acute, the commercial real estate market we service may be adversely impacted.

Factors Impacting Our Operating Results

The results of our operations are affected by a number of factors and primarily depend on, among other things, the level of our net interest income, the market value of our assets, including the real estate collateralizing our investments, and the supply of, and demand for, commercial mortgage loans, CRE debt and other financial assets in the marketplace. Our net interest income, which reflects the amortization of origination fees and direct costs, is recognized based on the contractual rate and the outstanding principal balance of the loans we originate. Interest rates vary according to the type of investment, conditions in the financial markets, creditworthiness of our borrowers, competition and other factors, none of which can be predicted with any certainty. Our operating results are also impacted by credit losses in excess of initial anticipations or unanticipated credit events experienced by borrowers.

Stock Repurchase Program

On July 30, 2025, our board of directors extended the Repurchase Program of up to $50.0 million, which was expected to be in effect until July 31, 2026, or until the approved dollar amount had been used to repurchase shares. On July 28, 2026, our board of directors further extended the Repurchase Program of up to $50.0 million, which is expected to be in effect until July 31, 2027, or until the approved dollar amount has been used to repurchase shares. Pursuant to the Repurchase Program, we may repurchase shares of our common stock in amounts, at prices and at such times as we deem appropriate, subject to market conditions and other considerations, including all applicable legal requirements. Repurchases may include purchases on the open market or privately negotiated transactions, under Rule 10b5-1 trading plans, under accelerated share repurchase programs, in tender offers and otherwise. The Repurchase Program does not obligate us to acquire any particular amount of shares of our common stock and may be modified or suspended at any time at our discretion. During the three and six months ended June 30, 2026, we did not repurchase any shares through the Repurchase Program.

Loans Held for Investment Portfolio

As of June 30, 2026, our portfolio included 38 loans held for investment, excluding 197 loans that were repaid, sold, converted to real estate owned or written-off since inception. As of June 30, 2026, the aggregate originated commitment under these loans at closing was approximately $2.0 billion and outstanding principal was $1.8 billion. During the six months ended June 30, 2026, we funded approximately $339.6 million of outstanding principal and received repayments of $110.7 million of outstanding principal. As of June 30, 2026, 89.2% of our loans have SOFR floors, with a weighted average floor of 1.71%, calculated based on loans with SOFR floors. References to SOFR or “S” are to 30-day SOFR (unless otherwise specifically stated).

Other than as set forth in Note 3 to our consolidated financial statements included in this quarterly report on Form 10-Q, as of June 30, 2026, all loans held for investment were paying in accordance with their contractual terms.

Our loans held for investment are accounted for at amortized cost. The following table summarizes our loans held for investment as of June 30, 2026 ($ in thousands):

_As of June 30, 2026_

| Line item | Carrying Value (1) | Outstanding Principal (1) | Weighted Average Unleveraged Effective Yield | Weighted Average Remaining Life (Years) (4) |
| --- | --- | --- | --- | --- |
| Senior mortgage loans | $1,729,417 | $1,818,946 | (3)%% | 1.4 |
| Subordinated debt and preferred equity investments | 19,418 | 21,223 | (3)%% | 0.8 |
| Total loans held for investment portfolio | $1,748,835 | $1,840,169 | (3)%% | 1.4 |

(1) The difference between the Carrying Value and the Outstanding Principal amount of the loans held for investment consists of unamortized purchase discounts, deferred loan fees and origination costs and cost-recovery proceeds.

(2) Unleveraged Effective Yield is the compounded effective rate of return that would be earned over the life of the investment based on the contractual interest rate (adjusted for any deferred loan fees, costs, premiums or discounts) and assumes no dispositions, early prepayments or defaults. The total Weighted Average Unleveraged Effective Yield is calculated based on the average of Unleveraged Effective Yield of all loans held by us as of June 30, 2026 as weighted by the outstanding principal balance of each loan.

(3) Unleveraged Effective Yield is the compounded effective rate of return that would be earned over the life of the investment based on the contractual interest rate (adjusted for any deferred loan fees, costs, premiums or discounts) and assumes no dispositions, early prepayments or defaults. The total Weighted Average Unleveraged Effective Yield is calculated based on the average of Unleveraged Effective Yield of all interest accruing loans held by us as of June 30, 2026 as weighted by the total outstanding principal balance of each interest accruing loan (excludes loans on non-accrual status as of June 30, 2026).

(4) Remaining Life is based on contractual maturity date and does not include contractual extension options not yet exercised.

Critical Accounting Estimates

Our consolidated financial statements have been prepared in accordance with generally accepted accounting principles (“GAAP”), which require management to make estimates and assumptions that affect reported amounts. These estimates and assumptions are based on historical experience and other factors management believes to be reasonable. Actual results may differ from those estimates and assumptions. For a description of our critical accounting estimates, please see Part II, “Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations” in our 2025 Annual Report on Form 10-K.

RECENT DEVELOPMENTS

Our board of directors declared a regular cash dividend of $0.15 per common share for the third quarter of 2026. The third quarter 2026 dividend will be payable on October 15, 2026 to common stockholders of record as of September 30, 2026.

RESULTS OF OPERATIONS

The following table sets forth a summary of our consolidated results of operations for the three and six months ended June 30, 2026 and 2025 ($ in thousands):

| f | For the Three Months Ended June 30, 2026 | For the Three Months Ended June 30, 2025 | For the Six Months Ended June 30, 2026 | For the Six Months Ended June 30, 2025 |
| --- | --- | --- | --- | --- |
| Total revenue | $14,356 | $12,565 | $27,816 | $27,513 |
| Total expenses | (8,970) | (10,750) | (17,527) | (21,412) |
| (Provision for) reversal of current expected credit losses, net | (865) | 20,150 | (12,003) | 25,490 |
| Realized losses on loans | — | (33,000) | (3,340) | (33,000) |
| Income (loss) before income taxes | 4,521 | (11,035) | (5,054) | (1,409) |
| Income tax expense (benefit), including excise tax | 138 | — | 169 | 281 |
| Net income (loss) attributable to common stockholders | $4,383 | $(11,035) | $(5,223) | $(1,690) |

The following tables set forth select details of our consolidated results of operations for the three and six months ended June 30, 2026 and 2025 ($ in thousands):

Net Interest Margin

| Line item | For the Three Months Ended June 30, 2026 | For the Three Months Ended June 30, 2025 | For the Six Months Ended June 30, 2026 | For the Six Months Ended June 30, 2025 |
| --- | --- | --- | --- | --- |
| Interest income | $27,754 | $23,117 | $52,660 | $50,597 |
| Interest expense | (19,182) | (16,101) | (36,543) | (34,290) |
| Net interest margin | $8,572 | $7,016 | $16,117 | $16,307 |

For the three months ended June 30, 2026 and 2025, net interest margin was approximately $8.6 million and $7.0 million, respectively. For the three months ended June 30, 2026 and 2025, interest income of $27.8 million and $23.1 million, respectively, was generated by weighted average earning assets of $1.9 billion and $1.4 billion, respectively, offset by $19.2 million and $16.1 million, respectively, of interest expense, unused fees and amortization of deferred loan costs. The weighted average borrowings under the Secured Funding Agreements, the Secured Term Loan and securitization debt, as applicable, for the three months ended June 30, 2026 and 2025 were $1.3 billion and $0.9 billion, respectively. The increase in net interest margin for the three months ended June 30, 2026 compared to the three months ended June 30, 2025 is primarily due to an increase in the weighted average earning assets for the three months ended June 30, 2026 as compared to the three months ended June 30, 2025.

For the six months ended June 30, 2026 and 2025, net interest margin was approximately $16.1 million and $16.3 million, respectively. For the six months ended June 30, 2026 and 2025, interest income of $52.7 million and $50.6 million, respectively, was generated by weighted average earning assets of $1.8 billion and $1.5 billion, respectively, offset by $36.5 million and $34.3 million, respectively, of interest expense, unused fees and amortization of deferred loan costs. The weighted average borrowings under the Secured Funding Agreements, the Secured Term Loan and securitization debt, as applicable, for the six months ended June 30, 2026 and 2025 were $1.2 billion and $1.0 billion, respectively. The decrease in net interest margin for the six months ended June 30, 2026 compared to the six months ended June 30, 2025 is primarily due to a decrease in SOFR rates on our loans held for investment and a decrease in the weighted average interest-bearing cash and cash equivalents balances held for the six months ended June 30, 2026 as compared to the six months ended June 30, 2025.

Revenue From Real Estate Owned

On September 19, 2024, we acquired legal title to a multi-building office property located in North Carolina through a deed in lieu of foreclosure. Prior to September 19, 2024, the office property collateralized a $68.6 million senior mortgage loan that we held that was in maturity default due to the failure of the borrower to repay the outstanding principal balance of the loan by the May 2024 maturity date. In conjunction with the deed in lieu of foreclosure, we derecognized the $68.6 million senior mortgage loan and recognized the office property as real estate owned. Revenues from this property consist primarily of rental revenue from operating leases. For the three and six months ended June 30, 2026, revenue from real estate owned related to this property was $2.6 million and $5.3 million, respectively. For the three and six months ended June 30, 2025, revenue from real estate owned related to this property was $2.3 million and $4.7 million, respectively. The increase in revenue from real estate owned related to this property for both the three and six months ended June 30, 2026 compared to the three and six months ended June 30, 2025 is primarily due to an increase in rental revenue from new operating leases.

On September 8, 2023, we acquired legal title to a mixed-use property located in Florida through a consensual foreclosure. Prior to September 8, 2023, the mixed-use property collateralized an $82.9 million senior mortgage loan that we held that was in maturity default due to the failure of the borrower to repay the outstanding principal balance of the loan by the February 2023 maturity date. In conjunction with the consensual foreclosure, we derecognized the $82.9 million senior mortgage loan and recognized the mixed-use property as real estate owned. Revenues from this property consist primarily of rental revenue from operating leases. For the three and six months ended June 30, 2026, revenue from real estate owned related to this property was $3.2 million and $6.4 million, respectively. For the three and six months ended June 30, 2025, revenue from real estate owned related to this property was $3.3 million and $6.5 million, respectively.

Operating Expenses

| Line item | For the Three Months Ended June 30, 2026 | For the Three Months Ended June 30, 2025 | For the Six Months Ended June 30, 2026 | For the Six Months Ended June 30, 2025 |
| --- | --- | --- | --- | --- |
| Management and incentive fees to affiliate | $2,394 | $2,430 | $4,794 | $4,997 |
| Professional fees | 699 | 673 | 1,519 | 1,550 |
| General and administrative expenses | 1,723 | 1,995 | 3,140 | 3,715 |
| General and administrative expenses reimbursed to affiliate | 853 | 1,024 | 1,639 | 2,027 |
| Expenses from real estate owned | 3,301 | 4,628 | 6,435 | 9,123 |
| Total expenses | $8,970 | $10,750 | $17,527 | $21,412 |

See the Related Party Expenses, Other Expenses and Expenses from Real Estate Owned discussions below for the cause of the changes in operating expenses for the three and six months ended June 30, 2026 compared to the three and six months ended June 30, 2025, respectively.

Related Party Expenses

For the three months ended June 30, 2026, related party expenses included $2.4 million in management fees due to our Manager pursuant to the Management Agreement. No incentive fees were incurred for the three months ended June 30, 2026. For the three months ended June 30, 2026, related party expenses also included $0.9 million for our share of allocable general and administrative expenses for which we were required to reimburse our Manager pursuant to the Management Agreement. For the three months ended June 30, 2025, related party expenses included $2.4 million in management fees due to our Manager pursuant to the Management Agreement. No incentive fees were incurred for the three months ended June 30, 2025. For the three months ended June 30, 2025, related party expenses also included $1.0 million for our share of allocable general and administrative expenses for which we were required to reimburse our Manager pursuant to the Management Agreement. Management fees were relatively consistent for both the three months ended June 30, 2026 and 2025. The decrease in allocable general and administrative expenses due to our Manager for the three months ended June 30, 2026 compared to the three months ended June 30, 2025 relates to changes in the mix of employees of our Manager that allocated time to us.

For the six months ended June 30, 2026, related party expenses included $4.8 million in management fees due to our Manager pursuant to the Management Agreement. No incentive fees were incurred for the six months ended June 30, 2026. For the six months ended June 30, 2026, related party expenses also included $1.6 million for our share of allocable general and administrative expenses for which we were required to reimburse our Manager pursuant to the Management Agreement. For the six months ended June 30, 2025, related party expenses included $5.0 million in management fees due to our Manager pursuant to the Management Agreement. No incentive fees were incurred for the six months ended June 30, 2025. For the six months ended June 30, 2025, related party expenses also included $2.0 million for our share of allocable general and administrative expenses for which we were required to reimburse our Manager pursuant to the Management Agreement. The decrease in management fees for the six months ended June 30, 2026 compared to the six months ended June 30, 2025 primarily relates to a decrease in our weighted average stockholders’ equity for the six months ended June 30, 2026 as a result of realized losses on loans. The decrease in allocable general and administrative expenses due to our Manager for the six months ended June 30, 2026 compared to the six months ended June 30, 2025 relates to changes in the mix of employees of our Manager that allocated time to us.

Other Expenses

For both the three months ended June 30, 2026 and 2025, professional fees were $0.7 million. For the three months ended June 30, 2026 and 2025, general and administrative expenses were $1.7 million and $2.0 million, respectively. The decrease in general and administrative expenses for the three months ended June 30, 2026 compared to the three months ended June 30, 2025 primarily relates to a decrease in stock-based compensation expense due to a reduction in the weighted average grant date fair value for restricted stock and restricted stock unit awards granted after June 30, 2025 and a reduction in various operating expenses for the three months ended June 30, 2026.

For the six months ended June 30, 2026 and 2025, professional fees were $1.5 million and $1.6 million, respectively, which was relatively consistent for both periods. For the six months ended June 30, 2026 and 2025, general and administrative expenses were $3.1 million and $3.7 million, respectively. The decrease in general and administrative expenses for the six months ended June 30, 2026 compared to the six months ended June 30, 2025 primarily relates to a decrease in stock-based compensation expense due to a reduction in the weighted average grant date fair value for restricted stock and restricted stock unit awards granted after June 30, 2025 and a reduction in various operating expenses for the six months ended June 30, 2026.

Expenses From Real Estate Owned

For the three and six months ended June 30, 2026 and 2025, expenses from real estate owned were comprised of the following ($ in thousands):

| Line item | For the Three Months Ended June 30, 2026 | For the Three Months Ended June 30, 2025 | For the Six Months Ended June 30, 2026 | For the Six Months Ended June 30, 2025 |
| --- | --- | --- | --- | --- |
| Mixed-use property operating expenses | $1,130 | $1,069 | $2,343 | $2,296 |
| Office property operating expenses | 1,298 | 1,322 | 2,307 | 2,417 |
| Depreciation and amortization expense | 873 | 2,237 | 1,785 | 4,410 |
| Expenses from real estate owned | $3,301 | $4,628 | $6,435 | $9,123 |

For both the three months ended June 30, 2026 and 2025, mixed-use property operating expenses were $1.1 million. For both the six months ended June 30, 2026 and 2025, mixed-use property operating expenses were $2.3 million. Mixed-use property operating expenses consisted primarily of expenses incurred in the day-to-day operation of our mixed-use property, including common area maintenance costs, property taxes and insurance. Common area maintenance costs include items such as maintenance and repairs, utilities, janitorial services, security and property management fees.

For both the three months ended June 30, 2026 and 2025, office property operating expenses were $1.3 million. For the six months ended June 30, 2026 and 2025, office property operating expenses were $2.3 million and $2.4 million, respectively. Office property operating expenses consisted primarily of expenses incurred in the day-to-day operation of our multi-building office property, including common area maintenance costs, property taxes and insurance. Common area maintenance costs include items such as maintenance and repairs, utilities, janitorial services, security and property management fees.

For the three and six months ended June 30, 2026, depreciation and amortization expense was $0.9 million and $1.8 million, respectively, and relates primarily to our mixed-use property acquired on September 8, 2023. For the three and six months ended June 30, 2026, no depreciation or amortization expense was incurred for our multi-building office property acquired on September 19, 2024 as the multi-building office property was classified as real estate owned held for sale. For the three and six months ended June 30, 2025, depreciation and amortization expense was $2.2 million and $4.4 million, respectively, and related primarily to our mixed-use property acquired on September 8, 2023 and our multi-building office property acquired on September 19, 2024.

(Provision for) Reversal of Current Expected Credit Losses, Net

For the three months ended June 30, 2026 and 2025, the net (provision for) reversal of current expected credit losses was $(0.9) million and $20.2 million, respectively. For the three months ended June 30, 2026, the net provision for current expected credit losses is primarily due to changes in loan- and collateral-specific attributes, new loan closings and a relative decline in the near-term macroeconomic forecasts during the three months ended June 30, 2026. These factors were partially offset by shorter average remaining loan term and other changes in loan- and collateral-specific attributes during the three months ended June 30, 2026. For the three months ended June 30, 2025, the net reversal of current expected credit losses was primarily due to a realized loss on an office (life sciences) loan, resulting in a reversal of the associated CECL Reserve, shorter average remaining loan term, loan repayments and other loan- and collateral-specific attributes during the three months ended June 30, 2025. These factors were partially offset by a relative decline in the near-term macroeconomic forecasts, including higher tariffs, high inflation and interest rates, and other loan- and collateral-specific attributes during the three months ended June 30, 2025.

For the six months ended June 30, 2026 and 2025, the net (provision for) reversal of current expected credit losses was $(12.0) million and $25.5 million, respectively. For the six months ended June 30, 2026, the net provision for current expected credit losses is primarily due to changes in loan- and collateral-specific attributes and new loan closings during the six months ended June 30, 2026. These factors were partially offset by a realized loss on a multifamily loan, resulting in a reversal of the associated CECL Reserve, shorter average remaining loan term, loan repayments and other changes in loan- and collateral-specific attributes during the six months ended June 30, 2026. For the six months ended June 30, 2025, the net reversal of current expected credit losses was primarily due to a realized loss on an office (life sciences) loan, resulting in a reversal of the associated CECL Reserve, shorter average remaining loan term, loan repayments and other loan- and collateral-specific attributes during the six months ended June 30, 2025. These factors were partially offset by a relative decline in the near-term macroeconomic forecasts, including higher tariffs, high inflation and interest rates, and other loan- and collateral-specific attributes during the six months ended June 30, 2025.

The CECL Reserve takes into consideration our estimates relating to the impact of macroeconomic conditions on CRE properties and is not specific to any loan losses or impairments on our loans held for investment, unless we determine that a specifically identifiable reserve is warranted for a select asset. Additionally, the CECL Reserve is not an indicator of what we expect our CECL Reserve would have been absent the current and potential future impacts of macroeconomic conditions.

Realized Losses on Loans

In June 2025, we received a discounted payoff on a senior mortgage loan with outstanding principal of $51.5 million, which was collateralized by an office (life sciences) property located in Massachusetts. The discounted payoff was received in conjunction with the sale of the office (life sciences) property by the borrower. For both the three and six months ended June 30, 2025, we recognized a realized loss of $33.0 million in our consolidated statements of operations upon the payoff of the senior mortgage loan as the Carrying Value exceeded the net proceeds from the payoff of the loan.

In March 2026, we received a discounted payoff on a senior mortgage loan with outstanding principal of $28.2 million, which was collateralized by a multifamily property located in Pennsylvania. The discounted payoff was received in conjunction with the sale of the multifamily property by the borrower. For the six months ended June 30, 2026, we recognized a realized loss of $3.3 million in our consolidated statements of operations upon the payoff of the senior mortgage loan as the Carrying Value exceeded the net proceeds from the payoff of the loan.

LIQUIDITY AND CAPITAL RESOURCES

Liquidity is a measure of our ability to meet potential cash requirements, including ongoing commitments to repay borrowings, fund and maintain our assets and operations, make distributions to our stockholders, repurchase shares and other general business needs. We use significant cash to purchase our target investments, make principal and interest payments on our borrowings, make distributions to our stockholders and fund our operations.

Our primary sources of cash generally consist of unused borrowing capacity under our Secured Funding Agreements, payments of principal and interest we receive on our portfolio of assets, cash generated from our operating activities and the net proceeds of future equity offerings, if any.

We expect our primary sources of cash to continue to be sufficient to fund our operating activities and cash commitments for investing and financing activities for at least the next 12 months and thereafter for the foreseeable future. As a result of the commercial real estate environment during 2025 and 2026, certain borrowers have been unable to make interest and principal payments timely, including at the maturity date of the borrower’s loan. We assess our CECL Reserve and increase it or decrease it from time to time, as necessary, to reflect this risk. Our Secured Funding Agreements contain margin call provisions following the occurrence of certain mortgage loan credit events. If we are unable to make the required payment or if we fail to meet or satisfy any of the covenants in our Financing Agreements, we would be in default under these agreements, and our lenders could elect to declare outstanding amounts due and payable, terminate their commitments, require the posting of additional collateral, including cash to satisfy margin calls, and enforce their interests against existing collateral. For example, certain of our Financing Agreements contain (i) negative covenants that limit, among other things, our ability to repurchase our common stock, make distributions to our stockholders, employ leverage beyond certain amounts, sell assets, engage in mergers or consolidations, grant liens, and enter into transactions with affiliates (including amending the Management Agreement in a material respect) and (ii) operating and financial covenants, including those requiring us to maintain a certain tangible net worth, asset coverage ratio, total net leverage ratio and loan concentration. We are also subject to cross-default and acceleration rights with respect to our Financing Agreements. If we experience borrower default as a result of macroeconomic conditions or otherwise, we may not be able to negotiate modifications to our borrowings with our lenders or receive financing from our Secured Funding Agreements with respect to our commitments to fund our loans held for investment in the future. See “Summary of Financing Agreements” below for a description of our Financing Agreements.

Subject to maintaining our qualification as a REIT and our exemption from registration under the 1940 Act, we expect that our primary sources of liquidity will be financing, to the extent available to us, through credit, secured funding and other lending facilities, other sources of private financing, including warehouse and repurchase facilities, and public or private offerings of our equity or debt securities. Macroeconomic conditions may impair our ability to access the financing and capital markets. Furthermore, we have sold, and may continue to sell certain of our mortgage loans, or interests therein, in order to manage liquidity needs. Subject to maintaining our qualification as a REIT, we may also change our dividend practice, including by reducing the amount of, or temporarily suspending, our future dividends or making dividends that are payable in cash and shares of our common stock for some period of time. We may also continue or discontinue share repurchases under the Repurchase Program.

Ares Management or one of its investment vehicles may originate mortgage loans. We have had and may continue to have the opportunity to purchase such loans that are determined by our Manager in good faith to be appropriate for us, depending on our available liquidity. Ares Management or one of its investment vehicles may also acquire mortgage loans from us.

We have commitments to fund various senior mortgage loans, as well as subordinated debt and preferred equity investments in our portfolio. Other than as set forth in this quarterly report on Form 10-Q, we do not have any relationships with unconsolidated entities or financial partnerships, such as entities often referred to as structured investment vehicles, special purpose entities or variable interest entities, established to facilitate off-balance sheet arrangements or other contractually narrow or limited purposes. Further, we have not guaranteed any obligations of unconsolidated entities or entered into any commitment or intend to provide additional funding to any such entities.

As of July 30, 2026, we had approximately $105 million in liquidity including $16 million of cash and $89 million of availability under our Secured Funding Agreements.

Cash Flows

The following table sets forth changes in cash, cash equivalents and restricted cash for the six months ended June 30, 2026 and 2025 ($ in thousands):

| Line item | For the Six Months Ended June 30, 2026 | For the Six Months Ended June 30, 2025 |
| --- | --- | --- |
| Net income (loss) | $(5,223) | $(1,690) |
| Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities | 12,161 | 14,580 |
| Net cash provided by (used in) operating activities | 6,938 | 12,890 |
| Net cash provided by (used in) investing activities | (211,278) | 324,998 |
| Net cash provided by (used in) financing activities | 195,758 | (310,047) |
| Change in cash, cash equivalents and restricted cash | $(8,582) | $27,841 |

During the six months ended June 30, 2026 and 2025, cash, cash equivalents and restricted cash increased (decreased) by $(8.6) million and $27.8 million, respectively.

Operating Activities

For the six months ended June 30, 2026 and 2025, net cash provided by operating activities totaled $6.9 million and $12.9 million, respectively. For the six months ended June 30, 2026, adjustments to net income (loss) related to operating activities primarily included the net provision for current expected credit losses of $12.0 million, accretion of discounts, deferred loan origination fees and costs of $2.6 million, amortization of deferred financing costs of $2.4 million, realized losses on loans of $3.3 million and change in other assets of $7.7 million. For the six months ended June 30, 2025, adjustments to net income (loss) related to operating activities primarily included the net reversal of current expected credit losses of $25.5 million, accretion of discounts, deferred loan origination fees and costs of $2.0 million, amortization of deferred financing costs of $2.4 million and realized losses on loans of $33.0 million.

Investing Activities

For the six months ended June 30, 2026, net cash used in investing activities totaled $211.3 million and was primarily related to cash used for the origination and funding of loans held for investment exceeding cash received from principal collections and cost-recovery proceeds on loans held for investment. For the six months ended June 30, 2025, net cash provided by investing activities totaled $325.0 million and was primarily related to cash received from principal collections and cost-recovery proceeds on loans held for investment exceeding the cash used for the origination and funding of loans held for investment.

Financing Activities

For the six months ended June 30, 2026, net cash provided by financing activities totaled $195.8 million and was primarily related to proceeds from our Secured Funding Agreements of $430.6 million partially offset by repayments of our Secured Funding Agreements of $115.7 million, repayments of debt of consolidated VIEs of $99.9 million and dividends paid of $16.9 million. For the six months ended June 30, 2025, net cash used in financing activities totaled $310.0 million and was primarily related to repayments of our Secured Funding Agreements of $61.4 million, repayments of debt of consolidated VIEs of $318.4 million, repayments of our Secured Term Loan of $20.0 million and dividends paid of $22.3 million, partially offset by proceeds from our Secured Funding Agreements of $114.8 million.

Summary of Financing Agreements

The sources of financing, as applicable in a given period, under our Financing Agreements are described in the following table ($ in thousands):

| Line item | As of / June 30, 2026 / Total Commitment | As of / June 30, 2026 / Outstanding Balance | As of / June 30, 2026 / Interest Rate | As of | As of / December 31, 2025 / Total Commitment | As of / December 31, 2025 / Outstanding Balance | As of / December 31, 2025 / Interest Rate |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- |
| Secured Funding Agreements: |  |  |  |  |  |  |  |  |
| Wells Fargo Facility | $600,000 | $562,962 | SOFR+1.35 to 3.75% | (1) | $600,000 | $438,911 | SOFR+1.40 to 3.75% | (1) |
| Citibank Facility | 425,000 | 340,195 | SOFR+1.50 to 3.00% | (2) | 325,000 | 269,265 | SOFR+1.50 to 3.00% | (2) |
| CNB Facility | 75,000 | — | SOFR+3.25% | (3) | 75,000 | — | SOFR+3.25% | (3) |
| Morgan Stanley Facility | 350,000 | 269,870 | SOFR+1.55 to 3.50% | (4) | 150,000 | 150,000 | SOFR+1.75 to 3.50% | (4) |
| Subtotal | $1,450,000 | $1,173,027 |  |  | $1,150,000 | $858,176 |  |  |
| Secured Term Loan | $90,000 | $90,000 | 5.75% | (5) | $90,000 | $90,000 | 5.25% | (5) |
| Total | $1,540,000 | $1,263,027 |  |  | $1,240,000 | $948,176 |  |  |

(1) The maturity date of the master repurchase funding facility with Wells Fargo Bank, National Association (the “Wells Fargo Facility”) is subject to two 12-month extensions, each of which may be exercised at our option provided that certain conditions are met and applicable extension fees are paid.

(2) The maturity date of the master repurchase facility with Citibank, N.A. (the “Citibank Facility”) is subject to two 12-month extensions, each of which may be exercised at our option provided that certain conditions are met and applicable extension fees are paid. In March 2026, we exercised each of our two $50.0 million accordion options on the Citibank Facility to increase the maximum commitment from $325.0 million to $425.0 million with payment of an upsize fee.

(3) In March 2026, we amended the secured revolving funding facility with City National Bank (the “CNB Facility”) to, among other things, extend the maturity date to December 31, 2026. The interest rate on advances under the CNB Facility is a per annum rate equal to the sum of, at our option, either (a) a SOFR-based rate plus 3.25% or (b) a base rate plus 2.25%, in each case, subject to an interest rate floor. The amount immediately available under the CNB Facility at any given time can fluctuate based on the fair value of the collateral in the borrowing base that secures the CNB Facility. As of June 30, 2026, there was $51.6 million of immediate availability under the CNB Facility based on the fair value of the collateral in the borrowing base at such time. The amount immediately available under the CNB Facility may be increased to up to $75.0 million by the pledge of additional collateral into the borrowing base in accordance with the CNB Facility agreement.

(4) In January 2026, we exercised our $100.0 million accordion option on the master repurchase and securities contract with Morgan Stanley (the “Morgan Stanley Facility”) to increase the maximum commitment from $150.0 million to $250.0 million with payment of an upsize fee. Subsequently, in March 2026, we amended the Morgan Stanley Facility to, among other things, (1) increase the maximum commitment from $250.0 million to $350.0 million and include an accordion provision such that the maximum commitment may be increased to up to $400.0 million at our option, subject to the satisfaction of certain conditions, including payment of an upsize fee and (2) extend the initial maturity date to July 16, 2029, subject to one 12-month extension, which may be exercised at our option provided that certain conditions are met and the applicable extension fee is paid.

(5) The maturity date of the Credit and Guaranty Agreement with the lenders referred to therein and Cortland Capital Market Services LLC, as administrative agent and collateral agent for the lenders (the “Secured Term Loan”) is November 12, 2026. Advances under the Secured Term Loan are set to the following fixed rates: (i) 4.50% per annum until May 1, 2025 and (ii) after May 1, 2025 through November 12, 2026, the interest rate increases 0.25% every three months.

Our Financing Agreements contain various affirmative and negative covenants, including negative pledges, and provisions related to events of default that are normal and customary for similar financing agreements. As of June 30, 2026, we were in compliance with all financial covenants of each respective Financing Agreement. We may be required to fund commitments on our loans held for investment in the future and we may not receive funding from our Secured Funding Agreements with respect to these commitments. See Note 6 to our consolidated financial statements included in this quarterly report on Form 10-Q for more information on our Financing Agreements.

Securitizations

On January 20, 2026, we exercised our redemption option under the FL4 CLO Securitization, and in connection therewith, exchanged our remaining FL4 Notes and preferred equity in the FL4 Issuer for the remaining mortgage loans and real estate owned held by the FL4 Issuer and all of the FL4 Notes held by third parties were repaid in full at par. Therefore, as of June 30, 2026, there were no FL4 Notes outstanding.

Leverage Policies

We intend to use prudent amounts of leverage to increase potential returns to our stockholders. To that end, subject to maintaining our qualification as a REIT and our exemption from registration under the 1940 Act, we intend to continue to use borrowings to fund the origination or acquisition of our target investments. Given current macroeconomic conditions and our focus on first or senior mortgages, we currently expect that such leverage would not exceed, on a debt-to-equity basis, a 4.5-to-1 ratio. Our charter and bylaws do not restrict the amount of leverage that we may use. The amount of leverage we deploy for particular investments in our target investments depends upon our Manager’s assessment of a variety of factors, which includes, among others, our liquidity position, the anticipated liquidity and price volatility of the assets in our loans held for investment portfolio, the potential for losses and extension risk in our portfolio, the gap between the duration of our assets and liabilities, including hedges, the availability and cost of financing the assets, our opinion of the creditworthiness of our financing counterparties, the impact of the macroeconomic environment on the United States economy generally or in specific geographic regions and commercial mortgage markets, our outlook for the level and volatility of interest rates, the slope of the yield curve, the credit quality of our assets, the collateral underlying our assets, and our outlook for asset spreads relative to the SOFR curve or another alternative interest index rate commonly used for floating rate loans.

Dividends

We elected to be taxed as a REIT for United States federal income tax purposes and, as such, anticipate annually distributing to our stockholders at least 90% of our REIT taxable income, prior to the deduction for dividends paid. If we distribute less than 100% of our REIT taxable income in any tax year (taking into account any distributions made in a subsequent tax year under Sections 857(b)(9) or 858 of the Code), we will pay tax at regular corporate rates on that undistributed portion. Furthermore, if we distribute less than the sum of (1) 85% of our ordinary income for the calendar year, (2) 95% of our capital gain net income for the calendar year and (3) any undistributed shortfall from our prior calendar year (the “Required Distribution”) to our stockholders during any calendar year (including any distributions declared by the last day of the calendar year but paid in the subsequent year), then we are required to pay non-deductible excise tax equal to 4% of any shortfall between the Required Distribution and the amount that was actually distributed. Any of these taxes would decrease cash available for distribution to our stockholders. The 90% distribution requirement does not require the distribution of net capital gains. However, if we elect to retain any of our net capital gain for any tax year, we must notify our stockholders and pay tax at regular corporate rates on the retained net capital gain. The stockholders must include their proportionate share of the retained net capital gain in their taxable income for the tax year, receive a credit for their share of the tax paid by such REIT, and are deemed to have paid the REIT’s tax on their proportionate share of the retained capital gain. Furthermore, such retained capital gain may be subject to the nondeductible 4% excise tax. If we determine that our estimated current year taxable income (including net capital gain) will be in excess of estimated dividend distributions (including capital gains dividends) for the current year from such income, we accrue excise tax on a portion of the estimated excess taxable income as such taxable income is earned.

Before we make any distributions, whether for United States federal income tax purposes or otherwise, we must first meet both our operating and debt service requirements under our Financing Agreements. If our cash available for distribution is less than our REIT taxable income, we could be required to sell assets or borrow funds to make cash distributions or we may elect to make a portion of the Required Distribution in the form of a taxable stock distribution or distribution of debt securities.

## Item 3. Quantitative and Qualitative Disclosures About Market Risk

As part of our risk management strategy, our Manager closely monitors our portfolio and actively manages the credit, interest rate, market, prepayment, financing, real estate and inflation risks associated with holding a portfolio of our target investments. We manage our portfolio through an interactive process with our Manager and Ares Management. Our Manager has an Investment Committee that oversees compliance with our investment strategy and guidelines, loans held for investment portfolio holdings and financing strategy. We seek to manage our risks related to the credit quality of our assets, interest rates, liquidity, prepayment rates and market value while, at the same time, seeking to provide an opportunity to stockholders to realize attractive risk-adjusted returns through ownership of our capital stock. While we do not seek to avoid risk completely, we believe the risks can be quantified from historical experience and seek to actively manage those risks, to earn sufficient compensation to justify taking those risks and to maintain capital levels consistent with the risks we undertake.

Credit Risk

We are subject to varying degrees of credit risk in connection with holding our target investments. We have exposure to credit risk on our CRE loans held for investment. Our Manager seeks to manage credit risk by performing a due diligence process prior to origination or acquisition and through the use of non-recourse financing, when and where available and appropriate. Credit risk is also addressed through our Manager’s ongoing review of our loans held for investment portfolio. In addition, with respect to any particular target investment, our Manager’s investment team evaluates, among other things, relative valuation, comparable analysis, supply and demand trends, shape of yield curves, delinquency and default rates, recovery of various sectors and vintage of collateral.

In the commercial real estate market, certain borrowers have not been able to repay principal upon the loan maturity and may not be able to qualify for loan extensions. Additionally, when tenants are not able to pay rent to their landlords, property owners have difficulties making payments to their lenders. We have continued regular dialogue with our borrowers and our financing providers to assess this credit risk.

Interest Rate Risk

Interest rates are highly sensitive to many factors, including fiscal, monetary and trade policies and domestic and international economic and political considerations, as well as other factors beyond our control. We are subject to interest rate risk in connection with our assets and our related financing obligations, including our borrowings under the Financing Agreements. We primarily originate or acquire floating rate mortgage assets and finance those assets with index-matched floating rate liabilities. As a result, we significantly reduce our exposure to changes in portfolio value and cash flow variability related to changes in interest rates. In addition, we regularly measure our exposure to interest rate risk and assess interest rate risk and manage our interest rate exposure on an ongoing basis by comparing our interest rate sensitive assets to our interest rate sensitive liabilities. Based on that review, we determine whether or not we should enter into hedging transactions and derivative financial instruments, such as forward sale commitments and interest rate floors in order to mitigate our exposure to changes in interest rates.

While hedging activities may mitigate our exposure to adverse fluctuations in interest rates, certain hedging transactions that we have entered into or may enter into in the future, such as interest rate swap agreements, may also limit our ability to participate in the benefits of lower interest rates with respect to our investments. In addition, there can be no assurance that we will be able to effectively hedge our interest rate risk. As of June 30, 2026, we did not have hedging or derivative financial instruments in place.

In addition to the risks discussed above, there is also the risk of non-performance on floating rate assets. In the case of a significant increase in interest rates, the additional debt service payments due from our borrowers may strain the operating cash flows of the real estate assets underlying our mortgages and, potentially, contribute to non-performance or, in severe cases, default, which may be mitigated by borrower purchased interest rate caps.

Interest Rate Effect on Net Income

Our interest income and expense will generally change directionally with index rates. The impact of declining interest rates may be mitigated by interest rate floors and the impact of rising or declining interest rates may be mitigated by certain hedging transactions that we have entered into or may enter into in the future. The following table estimates the hypothetical increases/(decreases) in net income for a twelve month period, assuming (1) an immediate increase or decrease in 30-day SOFR as of June 30, 2026 and (2) no change in the outstanding principal balance of our loans held for investment portfolio and borrowings as of June 30, 2026 ($ in millions):

| Change in 30-Day SOFR | Increase/(Decrease) in Net Income |
| --- | --- |
| Up 100 basis points | $2.9 |
| Up 50 basis points | $1.4 |
| Down 50 basis points | $(1.4) |
| Down 100 basis points | $(1.4) |
| SOFR at 0 basis points | $14.1 |

The severity of any such impact depends on our asset/liability composition at the time as well as the magnitude and duration of the interest rate increase and any applicable floors or hedging transactions. If any of these events happen, we could experience a decrease in net income or incur a net loss during these periods, which could adversely affect our liquidity and results of operations.

Interest Rate Floor Risk

We primarily originate or acquire floating rate mortgage and mortgage-related assets. Some of these mortgage assets may be subject to interest rate floors. Similarly, some of our borrowing costs may be subject to interest rate floors. In a period of decreasing interest rates, the interest rate yields on our floating rate mortgage assets could decrease, while the interest rate costs on certain of our borrowings could be fixed at a higher floor. In addition, a decrease in interest rates or tightening credit spreads increases the likelihood that certain of our investments will be refinanced at lower rates. These factors could lower our net interest income or cause a net loss during periods of decreasing interest rates, which would harm our financial condition, cash flows and results of operations.

Market Risk

The estimated fair values of our investments fluctuate primarily due to changes in index rates, changes in credit spreads and other factors. In general, in a rising interest rate environment, whether due to increases in index rates or credit spreads, the estimated fair value of our fixed-rate investments would generally be expected to decrease; conversely, in a decreasing interest rate environment, whether due to decreases in index rates or credit spreads, the estimated fair value of our fixed-rate investments would generally be expected to increase. Also, in general, in a widening credit spread environment, the estimated fair value of our floating rate investments would generally be expected to decrease. However, in a compressing credit spread environment, the estimated fair value of our floating rate investments may not increase, particularly if prepayment restrictions are not in place and our floating rate investments are fully prepayable. As market volatility increases or liquidity decreases, the fair value of our investments and liabilities may be adversely impacted.

Prepayment Risk

Our net income (loss) and earnings may be affected by prepayment rates on our existing CRE loans. When we originate our CRE loans, we anticipate that we will generate an expected yield. When borrowers prepay their CRE loans faster than we expect, we may be unable to replace these CRE loans with new CRE loans that will generate yields which are as high as the prepaid CRE loans. If prepayment rates decrease in a high interest rate environment, borrowers exercise extension options on CRE loans or we extend the term of CRE loans, the life of the loans could extend beyond the term of the Financing Agreements that we borrow on to fund our CRE loans. This could have a negative impact on our results of operations. In some situations, we may be forced to fund additional cash collateral in connection with the Financing Agreements or sell assets to maintain adequate liquidity, which could cause us to incur losses.

Financing Risk

We borrow funds under our Financing Agreements to finance our target assets. We may be subject to risk arising from a default by one of several large banking institutions that are dependent on one another to meet their liquidity or operational needs, so that a default by one institution may cause a series of defaults by the other institutions, and may impact the liquidity of our lenders and their willingness to provide us with borrowings to finance our target assets and other needs.

In addition, our Secured Funding Agreements contain margin call provisions following the occurrence of certain mortgage loan credit events. If we are unable to make the required payment or if we fail to meet or satisfy any of the covenants in our Financing Agreements, we would be in default under these agreements, and our lenders could elect to declare outstanding amounts due and payable, terminate their commitments, require the posting of additional collateral, including cash to satisfy margin calls, and enforce their interests against existing collateral. For example, certain of our Financing Agreements contain (i) negative covenants that limit, among other things, our ability to repurchase our common stock, make distributions to our stockholders, employ leverage beyond certain amounts, sell assets, engage in mergers or consolidations, grant liens, and enter into transactions with affiliates (including amending the Management Agreement in a material respect) and (ii) operating and financial covenants, including those requiring us to maintain a certain tangible net worth, asset coverage ratio, total net leverage ratio and loan concentration. We are also subject to cross-default and acceleration rights with respect to our Financing Agreements. In addition, in the past, our CLO securitizations have contained certain senior note overcollateralization ratio tests. To the extent we issue CLO securitizations in the future and we fail to meet these tests, if included, amounts that would otherwise be used to make payments on the subordinate securities that we would hold would be used to repay principal on the more senior securities to the extent necessary to satisfy any senior note overcollateralization ratio and we may incur significant losses. Our sources of liquidity may be impacted to the extent we do not receive cash payments that we would otherwise expect to receive from the CLO securitizations if these tests were met. Additionally, in such a case, interest income may continue to accrue for the holders of subordinate securities within the CLO securitization notwithstanding the cash being used to repay principal on the more senior securities. This would cause us to recognize income but not have a corresponding amount of cash available for operations or for distribution to our stockholders.

Continued weakness or volatility in the financial markets, the commercial real estate and mortgage markets and the economy generally could adversely affect one or more of our lenders or potential lenders and could cause one or more of our lenders or potential lenders to be unwilling or unable to provide us with financing or to increase the costs of that financing. From time to time, capital markets may also experience periods of disruption and instability, which may adversely affect our ability to refinance our financing arrangements.

Real Estate Risk

Our real estate investments and the value of real estate owned are subject to volatility and may be affected adversely by a number of factors, including, but not limited to, national, regional and local economic conditions (which may be adversely affected by industry slowdowns and other factors); local real estate conditions; changes or continued weakness in specific industry segments; local markets with a significant exposure to the energy sector; construction quality, age and design; demographic factors; insurance costs; and retroactive changes to building or similar codes. Elevated interest rates and inflation have had, and continue to have, an adverse impact on industries whose properties serve as collateral for some of our portfolio investments. Similarly, increased demand for work-from-home arrangements and elevated costs to operate, improve or repurpose office properties have impacted the operations of office properties and rising operating costs, such as property insurance, have further pressured cash flow performance of commercial real estate. Decreases in property values reduce the value of the collateral and the potential proceeds available to a borrower to repay the underlying loan or loans, as the case may be, and reduce the value of properties that we own as a result of default on the underlying loan, each of which could cause us to suffer losses. We seek to manage these risks through our underwriting and asset management processes.

Inflation Risk

Virtually all of our assets and liabilities are sensitive to interest rates. As a result, interest rates and other factors influence our performance far more so than does inflation. Changes in interest rates do not necessarily correlate with inflation rates or changes in inflation rates but adverse changes in inflation or changes in inflation expectations can lead to lower returns on our investments than originally anticipated. Current levels of inflation could exacerbate this possibility. In each case, in general, our activities and balance sheet are measured with reference to historical cost and/or fair market value without considering inflation.

## Item 4. Controls and Procedures

Evaluation of Disclosure Controls and Procedures

We maintain disclosure controls and procedures (as that term is defined in Rules 13a‑15(e) and 15d‑15(e) under the Exchange Act) that are designed to ensure that information required to be disclosed in our reports under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms, and that such information is accumulated and communicated to our management, including our principal executive officer and principal financial officer, as appropriate, to allow timely decisions regarding required disclosures. Any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives. Our management, with the participation of our principal executive officer and principal financial officer, has evaluated the effectiveness of the design and operation of our disclosure controls and procedures as of June 30, 2026. Based upon that evaluation and subject to the foregoing, our principal executive officer and principal financial officer concluded that, as of June 30, 2026, the design and operation of our disclosure controls and procedures were effective to accomplish their objectives at the reasonable assurance level.

Changes in Internal Control over Financial Reporting

There have been no changes in our internal control over financial reporting (as defined in Rules 13a‑15(f) and 15d‑15(f) under the Exchange Act) during the quarter ended June 30, 2026 that have materially affected, or that are reasonably likely to materially affect, our internal control over financial reporting.

PART II — OTHER INFORMATION

## Item 1. Legal Proceedings

From time to time, we, our executive officers, directors and our Manager, and its affiliates and/or any of their respective principals and employees are subject to legal proceedings, including those arising from our loans, and we and our Manager are also subject to extensive regulation, which, from time to time, results in requests for information from us or our Manager or legal or regulatory proceedings or investigations against us or our Manager, respectively. We incur significant costs and expenses in connection with any such proceedings, information requests and investigations.

## Item 1A. Risk Factors

You should carefully consider the risk factors discussed in Part I, “Item 1A. Risk Factors” in our 2025 Annual Report, which could materially affect our business, financial condition and/or operating results. The risks described in our 2025 Annual Report are not the only risks facing our Company. Additional risks and uncertainties not currently known to us or that we currently deem to be immaterial also may materially and adversely affect our business, financial condition and/or operating results.

## Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

Purchases of Equity Securities by the Issuer and Affiliated Purchasers

| Period | Total Number of Shares Purchased | Average Price Paid Per Share | Total Number of Shares Purchased as Part of Publicly Announced Program (1) | Maximum Approximate Dollar Value of Shares that May Yet Be Purchased Under the Program (1) ($ in thousands) |
| --- | --- | --- | --- | --- |
| April 1, 2026 - April 30, 2026 | — | $— | — | $50,000 |
| May 1, 2026 - May 31, 2026 | — | — | — | 50,000 |
| June 1, 2026 - June 30, 2026 | — | — | — | 50,000 |
| Total | — |  | — |  |

(1) On July 30, 2025, our board of directors extended the Repurchase Program of up to $50.0 million, which was expected to be in effect until July 31, 2026, or until the approved dollar amount had been used to repurchase shares. On July 28, 2026, our board of directors further extended the Repurchase Program of up to $50.0 million, which is expected to be in effect until July 31, 2027, or until the approved dollar amount has been used to repurchase shares. As of June 30, 2026, $50.0 million remained available for future purchases of our common stock under the Repurchase Program. The Repurchase Program does not obligate us to acquire any particular amount of shares of our common stock and may be modified or suspended at any time at our discretion.

## Item 3. Defaults Upon Senior Securities

None.

## Item 4. Mine Safety Disclosures

Not applicable.

## Item 5. Other Information

Rule 10b5-1 Trading Plans

During the fiscal quarter ended June 30, 2026, none of our directors or executive officers adopted or terminated any contract, instruction or written plan for the purchase or sale of our securities intended to satisfy the affirmative defense conditions of Rule 10b5-1(c) or any “non-Rule 10b5-1 trading arrangement.”

Resignation of Chief Operating Officer

On July 31, 2026, Tae-Sik Yoon informed the Company that he will step down as its Chief Operating Officer effective as of September 30, 2026. Mr. Yoon’s decision is in connection with an overall plan whereby Mr. Yoon expects to transition from his current position at Ares Management as Partner and Chief Financial Officer of its Real Estate and Private Equity Groups to Partner and Senior Advisor effective as of January 1, 2027.

## Item 6. Exhibits

EXHIBIT INDEX

| Exhibit Number | Exhibit Description |
| --- | --- |
| 3.1 | Articles of Amendment and Restatement of Ares Commercial Real Estate Corporation (incorporated by reference to Exhibit 3.1 to the Company’s Form 10-K (File No. 001-35517), filed on March 1, 2016). |
| 3.2 | Second Amended and Restated Bylaws of Ares Commercial Real Estate Corporation (incorporated by reference to Exhibit 3.2 to the Company’s Form 10-K (File No. 001-35517), filed on February 15, 2023). |
| 10.1 | Eighth Amendment to Master Repurchase Agreement and Omnibus Amendment and Reaffirmation of Other Transaction Documents, dated as of June 9, 2026, by and among ACRC Lender C LLC, as Existing Seller, ACRC Lender C TRS LLC, as New Seller, Ares Commercial Real Estate Corporation, as Guarantor, ACRC 2017-FL3 Holder REIT LLC, as Existing Pledgor, ACRC Lender TRS LLC, as New Pledgor, and Citibank, N.A., a national banking association, as Buyer |
| 31.1 | Certification of Chief Executive Officer pursuant to Rule 13a-14(a) and Rule 15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 |
| 31.2 | Certification of Chief Financial Officer pursuant to Rule 13a-14(a) and Rule 15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 |
| 32.1 | Certification of Chief Executive Officer and Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 |
| 101.INS | XBRL Instance Document |
| 101.SCH | XBRL Taxonomy Extension Schema Document |
| 101.CAL | XBRL Taxonomy Extension Calculation Linkbase Document |
| 101.LAB | XBRL Taxonomy Extension Label Linkbase Document |
| 101.PRE | XBRL Taxonomy Extension Presentation Linkbase Document |
| 101.DEF | XBRL Taxonomy Extension Definition Linkbase Document |
| 104 | Cover Page Interactive Data File (formatted in Inline XBRL and contained in Exhibit 101) |

\* Filed herewith

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

ARES COMMERCIAL REAL ESTATE CORPORATION

Date: August 4, 2026 By: /s/ Bryan P. Donohoe

Bryan P. Donohoe

Chief Executive Officer and Director   (Principal Executive Officer)

Date: August 4, 2026 By: /s/ Jeffrey M. Gonzales

Jeffrey M. Gonzales

Chief Financial Officer and Treasurer   (Principal Financial and Accounting Officer)

---

## EX-10.1

SEC source: [exhibit101-citibankeightha.htm](https://www.sec.gov/Archives/edgar/data/1529377/000162828026052072/exhibit101-citibankeightha.htm)

Exhibit 10.1

EXECUTION VERSION

EIGHTH AMENDMENT TO MASTER REPURCHASE AGREEMENT AND OMNIBUS AMENDMENT AND REAFFIRMATION OF OTHER TRANSACTION DOCUMENTS

THIS EIGHTH AMENDMENT TO MASTER REPURCHASE AGREEMENT AND OMNIBUS AMENDMENT AND REAFFIRMATION OF OTHER TRANSACTION DOCUMENTS (this “Amendment”) is made as of June 9, 2026 (the “Effective Date”), by and among ACRC LENDER C LLC, a Delaware limited liability company (“Existing Seller”), ACRC LENDER C TRS LLC, a Delaware limited liability company (“New Seller” and, together with Existing Seller, individually and/or collectively as the context may require, “Seller”), ARES COMMERCIAL REAL ESTATE CORPORATION, a Maryland corporation (“Guarantor”), ACRC 2017-FL3 HOLDER REIT LLC, a Delaware limited liability company (“Existing Pledgor”), ACRC LENDER TRS LLC, a Delaware limited liability company (“New Pledgor” and, together with Existing Pledgor, individually and/or collectively as the context may require, “Pledgor”), and CITIBANK, N.A., a national banking association (“Buyer”), and acknowledged and agreed to by U.S. BANK, NATIONAL ASSOCIATION (“Custodian”) solely with respect to the Custodial Agreement (as such term is defined in the Repurchase Agreement (as defined below)).

RECITALS:

WHEREAS, Existing Seller and Buyer entered into that certain Master Repurchase Agreement, dated as of December 8, 2014, as amended by (1) that certain First Amendment to Master Repurchase Agreement, dated as of July 13, 2016, (2) that certain Second Amendment to Master Repurchase Agreement, dated as of July 13, 2016, (3) that certain Third Amendment to Master Repurchase Agreement, dated as of December 8, 2016, (4) that certain Fourth Amendment to Master Repurchase Agreement, dated as of December 10, 2018, (5) that certain Amended and Restated Fourth Amendment to Master Repurchase Agreement, dated as of December 13, 2018, (6) that certain Fifth Amendment to Master Repurchase Agreement, dated as of November 30, 2021, (7) that certain Sixth Amendment to Master Repurchase Agreement, dated as of January 13, 2022, (8) that certain Omnibus Amendment to Repurchase Documents, dated as of November 4, 2024, and (9) that certain Seventh Amendment to Master Repurchase Agreement, dated as of December 31, 2024 (as further amended, restated, supplemented or otherwise modified from time to time prior to the date hereof, collectively, the “Repurchase Agreement”).

WHEREAS, all capitalized terms used herein and not otherwise defined shall have the respective meanings set forth in the Repurchase Agreement.

WHEREAS, Guarantor entered into that certain Second Amended and Restated Substitute Guaranty, dated as of December 13, 2018, for the benefit of Buyer (as amended, restated, supplemented or otherwise modified from time to time prior to the date hereof, the “Guaranty”).

WHEREAS, Existing Pledgor entered into that certain Pledge and Security Agreement, dated as of November 4, 2024, for the benefit of Buyer (as amended, restated, supplemented or

otherwise modified from time to time prior to the date hereof, the “Existing Pledge Agreement”).

WHEREAS, concurrently with the Effective Date of this Amendment, (a) Existing Seller, New Seller and Buyer are entering into that certain Joinder Agreement to Master Repurchase Agreement, dated as of the date hereof (the “New Seller Joinder”) in order to join New Seller as a party to the Repurchase Agreement and other Transaction Documents, and (b) New Pledgor and Buyer are entering into that certain Pledge and Security Agreement, dated as of the date hereof (the “New Pledge Agreement” and, together with Existing Pledge Agreement, individually and/or collectively as the context may require, the “Pledge Agreement”).

WHEREAS, in connection with the New Seller Joinder, the parties hereto desire to (a) amend the Repurchase Agreement and each of the other Transaction Documents, excepting only the Pledge Agreement, and (b) reaffirm the obligations of Existing Seller, Guarantor and Existing Pledgor, as applicable, under the Transaction Documents.

NOW THEREFORE, in consideration of the foregoing and other valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto hereby consent and agree as follows:

AGREEMENT:

1.Amendments to Repurchase Agreement. Effective as of the Effective Date, the Repurchase Agreement is hereby amended to delete the stricken text (indicated textually in the same manner as the following example: stricken text) and to add the double-underlined text (indicated textually in the same manner as the following example: double-underlined text) as set forth in Exhibit A hereto. The parties hereto further acknowledge and agree that Exhibit A constitutes the Repurchase Agreement as amended and modified by the terms set forth herein and in the New Seller Joinder.

2.Amendments to Other Transaction Documents. Effective as of the Effective Date, the other Transaction Documents (excepting only the Pledge Agreement) are hereby amended as follows:

(a)Any references to, and any definition of “Seller” in any of the Transaction Documents shall mean, and such definition is hereby amended to refer to, individually and/or collectively as the context may require, each of Existing Seller and New Seller, together with each of their respective successors and permitted assigns;

(b)Any references to, and any definition of “Pledgor” in any of the Transaction Documents shall mean, and such definition is hereby amended to refer to, individually and/or collectively as the context may require, each of Existing Pledgor and New Pledgor, together with each of their respective successors and permitted assigns;

(c)Any references to, and any definition of “Repurchase Agreement” or “Master Repurchase Agreement” in any of the Transaction Documents shall mean, and such definition is hereby amended to refer to, the Repurchase Agreement, as modified by this Amendment and the New Seller Joinder, and as the same may be amended, restated, replaced, waived, modified, supplemented, extended or otherwise modified from time to time;

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(d)Any references to, and any definition of “Pledge and Security Agreement” in any of the Transaction Documents shall mean, and such definition is hereby amended to refer to, individually and/or collectively as the context may require, the Pledge Agreement, as the same may be amended, restated, replaced, waived, modified, supplemented, extended or otherwise modified from time to time; and

(e)On and after the Effective Date, all references in any of the Transaction Documents to “this Agreement”, “hereunder”, “herein” or words of like import referring to such Transaction Document shall mean and be a reference to such Transaction Document as modified by this Amendment.

3.Reaffirmation of Guaranty. Guarantor hereby (a) acknowledges and consents to the execution and delivery of this Amendment, the New Seller Joinder and the other Transaction Documents to be executed in connection herewith, and (b) represents, warrants and covenants that notwithstanding the execution and delivery of this Amendment, the New Seller Joinder and the other Transaction Documents to be executed in connection herewith, all of Guarantor’s obligations under the Guaranty remain in full force and effect and the same are hereby irrevocably and unconditionally ratified and confirmed by Guarantor in all respects.

4.Guarantor’s Representations. Guarantor represents and warrants that (i) Guarantor has taken all necessary action to authorize the execution, delivery and performance of this Amendment, (ii) this Amendment has been duly executed and delivered by or on behalf of Guarantor and constitutes the legal, valid and binding obligation of Guarantor enforceable against Guarantor in accordance with its terms subject to bankruptcy, insolvency, and other limitations on creditors’ rights generally and to equitable principles, (iii) no Event of Default has occurred and is continuing, and no Event of Default will occur as a result of the execution, delivery and performance by Guarantor of this Amendment, and (iv) any consent, approval, authorization, order, registration or qualification of or with any Governmental Authority required for the execution, delivery and performance by Guarantor of this Amendment has been obtained and is in full force and effect (other than consents, approvals, authorizations, orders, registrations or qualifications that if not obtained, are not reasonably likely to have a Material Adverse Effect).

5.Existing Seller’s Reaffirmation. Existing Seller hereby (a) acknowledges and consents to the execution and delivery of this Amendment, the New Seller Joinder and the other Transaction Documents to be executed in connection herewith, and (b) represents, warrants and covenants to Buyer that all of the terms, covenants and conditions of the Transaction Documents remain unmodified (except as expressly modified hereby) and are in full force and effect and enforceable in accordance with their respective terms, and the same are hereby irrevocably and unconditionally ratified and confirmed by Existing Seller in all respects. Any inconsistency between this Amendment and the Transaction Documents (as same existed before this Amendment) shall be resolved in favor of this Amendment, whether or not this Amendment specifically modifies the particular provision(s) in the Transaction Documents inconsistent with this Amendment.

6.Sellers’ Representations. Each Seller represents and warrants that (i) such Seller has taken all necessary action to authorize the execution, delivery and performance of this Amendment, (ii) this Amendment has been duly executed and delivered by or on behalf of such Seller and constitutes the legal, valid and binding obligation of such Seller enforceable against such Seller in accordance with its terms subject to bankruptcy, insolvency, and other limitations on creditors’ rights generally and to equitable principles, (iii) no Event of Default has occurred and is continuing, and no Event of Default will occur as a result of the execution, delivery and performance by such Seller of this Amendment, and (iv) any consent, approval, authorization, order, registration or qualification of or with any Governmental Authority required for the

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execution, delivery and performance by such Seller of this Amendment has been obtained and is in full force and effect (other than consents, approvals, authorizations, orders, registrations or qualifications that if not obtained, are not reasonably likely to have a Material Adverse Effect).

7.Existing Pledgor’s Reaffirmation. Existing Pledgor hereby (a) acknowledges and consents to the execution and delivery of this Amendment, the New Seller Joinder and the other Transaction Documents to be executed in connection herewith, and (b) represents, warrants and covenants that notwithstanding the execution and delivery of this Amendment, the New Seller Joinder and the other Transaction Documents executed in connection herewith, all of Existing Pledgor’s obligations under the Existing Pledge Agreement remain in full force and effect and the same are hereby irrevocably and unconditionally ratified and confirmed by Existing Pledgor in all respects.

8.Pledgors’ Representations. Each Pledgor represents and warrants that (i) such Pledgor has taken all necessary action to authorize the execution, delivery and performance of this Amendment, (ii) this Amendment has been duly executed and delivered by or on behalf of such Pledgor and constitutes the legal, valid and binding obligation of such Pledgor enforceable against such Pledgor in accordance with its terms subject to bankruptcy, insolvency, and other limitations on creditors’ rights generally and to equitable principles, (iii) no Event of Default has occurred and is continuing, and no Event of Default will occur as a result of the execution, delivery and performance by such Pledgor of this Amendment, and (iv) any consent, approval, authorization, order, registration or qualification of or with any Governmental Authority required for the execution, delivery and performance by such Pledgor of this Amendment has been obtained and is in full force and effect (other than consents, approvals, authorizations, orders, registrations or qualifications that if not obtained, are not reasonably likely to have a Material Adverse Effect).

9.Conditions Precedent. This Amendment and its provisions shall become effective upon Buyer’s receipt of each of the following:

(a)Transaction Documents. Buyer shall have received the following duly executed and authorized documents:

(i)this Amendment, duly executed and delivered by each of the parties hereto;

(ii)the New Seller Joinder, duly executed and delivered by Existing Seller, New Seller and Buyer;

(iii)the New Pledge Agreement, duly executed and delivered by New Pledgor and Buyer;

(iv)that certain Joinder Agreement #2, dated as of May 20, 2026, duly executed and delivered by New Seller, Trimont LLC, as servicer, and Ares Commercial Real Estate Servicer LLC, as special servicer; and

(v)that certain Power of Attorney, duly executed and delivered by New Seller;

(b)Intentionally Omitted.

(c)Security Interest. Evidence that all actions necessary to perfect Buyer’s interest in the Purchased Loans and the Pledged Collateral with respect to New Seller, New Pledgor and Existing Seller have been taken, including, without limitation, duly

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authorized and filed Uniform Commercial Code financing statements on Form UCC-1; and

(d)Officer’s Certificate. An officer’s certificate for each Seller, each Pledgor and Guarantor (i) certifying as to and attaching a good standing certificate from its respective state or jurisdiction of formation, (ii) certifying as to and attaching its respective organizational documents and (iii) certifying as to its respective authority to execute and deliver, and perform its respective obligations under, this Amendment, the Repurchase Agreement, the Guaranty and the Pledge and Security Agreement, as applicable.

10.Account Control Agreement; Legal Opinions. Seller covenants and agrees to deliver to Buyer each of the following:

(a)Account Control Agreement. Within thirty (30) days of the Effective Date or by such later date as Buyer may approve in its sole and absolute discretion, a new blocked account agreement with New Seller and Controlled Account Bank (in substantially the same form as the existing Blocked Account Agreement) establishing a Buyer’s Account in accordance with Section 5 of the Repurchase Agreement, or an agreement to amend, restate, or otherwise modify the Blocked Account Agreement in order to join the New Seller thereto, in either case, in form and substance reasonably acceptable to Buyer; and

(b)Legal Opinions. Within thirty (30) days of the Effective Date or by such later date as Buyer may approve in its sole and absolute discretion, opinions of outside counsel to Seller, Pledgor and Guarantor in form and substance reasonably acceptable to Buyer (including, but not limited to, those relating to enforceability, corporate matters, applicability of the Investment Company Act of 1940, security interests and a Bankruptcy Code safe harbor opinion).

11.Agreement Regarding Expenses. Seller agrees to pay Buyer’s reasonable out-of-pocket expenses (including reasonable legal fees of outside counsel) incurred in connection with the preparation and negotiation of this Amendment and the other Transaction Documents delivered in connection herewith promptly after Buyer or Buyer’s counsel gives Seller an invoice for such expenses.

12.No Waiver. The execution, delivery and effectiveness of this Amendment shall not operate as a waiver of any right, power or remedy of the Buyer under the Repurchase Agreement, any of the other Transaction Documents or any other document, instrument or agreement executed and/or delivered in connection therewith.

13.Governing Law. This Amendment shall be governed in accordance with the terms and provisions of Section 20 of the Repurchase Agreement.

14.Severability. Wherever possible, each provision of this Amendment shall be interpreted in such manner as to be effective and valid under applicable law, but if any provision of this Amendment shall be prohibited by or invalid under applicable law, such provision shall be ineffective to the extent of such prohibition or invalidity, without invalidating the remainder of such provision or the remaining provisions of this Amendment.

15.Counterparts. This Amendment may be executed in any number of counterparts, and all such counterparts shall together constitute the same agreement. Signatures delivered by email (in PDF format) shall be considered binding with the same force and effect as original signatures

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16.Successors and Assigns. This Amendment shall inure to the benefit of and shall be binding on the parties hereto and their respective successors and assigns.

17.Amendments. This Amendment may not be modified, amended, waived, changed or terminated orally, but only by an agreement in writing signed by the party against whom the enforcement of the modification, amendment, waiver, change or termination is sought.

[NO FURTHER TEXT ON THIS PAGE]

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IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be duly executed by their duly authorized representatives, all as of the day and year first above written.

BUYER:  

CITIBANK, N.A.,

a national banking association  

By: /s/ Christopher Cho  
Name: Christopher Cho  
Title: Authorized Signatory

[Signatures Continue on Following Page]

Signature Page to Eighth Amendment to MRA and Omnibus Amendment to Other Transaction Documents

EXISTING SELLER: ACRC LENDER C LLC,  
a Delaware limited liability company  

By: /s/ Keith Kooper

Name: Keith Kooper  
Title: Vice President & Asst Secretary

NEW SELLER: ACRC LENDER C TRS LLC,  
a Delaware limited liability company  

By: /s/ Keith Kooper

Name: Keith Kooper  
Title: Vice President & Asst Secretary

GUARANTOR:  

ARES COMMERCIAL REAL ESTATE CORPORATION,  
a Maryland corporation

By: /s/ Keith Kooper

Name: Keith Kooper  
Title: Vice President & Asst Secretary

[Signatures Continue on Following Page]

Signature Page to Eighth Amendment to MRA and Omnibus Amendment to Other Transaction Documents

EXISTING PLEDGOR: ACRC 2017-FL3 HOLDER REIT LLC,

a Delaware limited liability company  

By: /s/ Jessica Mattoon

Name: Jessica Mattoon  
Title: Vice President

NEW PLEDGOR:

ACRC LENDER TRS LLC,  
a Delaware limited liability company  

By: /s/ Jessica Mattoon

Name: Jessica Mattoon  
Title: Vice President

Signature Page to Eighth Amendment to MRA and Omnibus Amendment to Other Transaction Documents

Acknowledged and agreed to solely with respect to the Custodial Agreement:

CUSTODIAN:

U.S. BANK, NATIONAL ASSOCIATION

By: /s/ Kevin E. Brown

Name: Kevin E. Brown

Title: Vice President

Signature Page to Eighth Amendment to MRA and Omnibus Amendment to Other Transaction Documents

EXHIBIT A

REPURCHASE AGREEMENT

[See attached.]

CONFORMED THROUGH:

First Amendment dated as of July 13, 2016

Second Amendment dated as of July 13, 2016

Third Amendment dated as of December 8, 2016

Fourth Amendment dated as of December 13, 2018

Fifth Amendment dated as of November 30, 2021

Sixth Amendment dated as of January 13, 2022

Seventh Amendment dated as of December 31, 2024

Eighth Amendment dated as of June 9, 2026

MASTER REPURCHASE AGREEMENT  

Dated as of December 8, 2014  

between  

ACRC LENDER C LLC,

and

ACRC LENDER C TRS LLC,

as SellerSellers,  

and  

CITIBANK, N.A.,  

as Buyer

TABLE OF CONTENTS

Page

1.APPLICABILITY 1

2.DEFINITIONS 1

3.INITIATION; CONFIRMATION; TERMINATION; FEES 26

4.MARGIN MAINTENANCE 34

5.INCOME PAYMENTS AND PRINCIPAL PAYMENTS 35

6.SECURITY INTEREST 38

7.PAYMENT, TRANSFER AND CUSTODY 42

8.SALE, TRANSFER, HYPOTHECATION OR PLEDGE OF PURCHASED LOANS 43

9.TRANSACTION CONDITIONS PRECEDENT 44

10.REPRESENTATIONS OF SELLER 46

11.INTENTIONALLY OMITTED 50

12.COVENANTS OF SELLER 50

13.SINGLE-PURPOSE ENTITY 54

14.EVENTS OF DEFAULT; REMEDIES 57

15.SINGLE AGREEMENT 64

16.RECORDING OF COMMUNICATIONS 64

17.NOTICES AND OTHER COMMUNICATIONS 65

18.ENTIRE AGREEMENT; SEVERABILITY 65

19.ASSIGNMENTS; PARTICIPATIONS AND REGISTERED FORM 65

20.GOVERNING LAW 66

21.NO WAIVERS, ETC. 67

22.USE OF EMPLOYEE PLAN ASSETS 67

23.INTENT 67

24.DISCLOSURE RELATING TO CERTAIN FEDERAL PROTECTIONS 69

25.CONSENT TO JURISDICTION; WAIVER OF JURY TRIAL 70

26.NO RELIANCE 71

27.INDEMNITY 71

28.DUE DILIGENCE 73

29.SERVICING 73

30.MISCELLANEOUS 74

31.TAXES 76

32.JOINT AND SEVERAL OBLIGATIONS 78

ANNEXES AND EXHIBITS

ANNEX I Names and Addresses for Communications between Parties

SCHEDULE I Schedule of Competitors

SCHEDULE II Organizational Chart

EXHIBIT I Representations and Warranties Re: Each Individual Purchased Loan

EXHIBIT II Funding Date File Data Fields

EXHIBIT III Form of Request for Transaction/Increase in Purchase Price

EXHIBIT IV Form of Funding Confirmation

EXHIBIT V Form of Irrevocable Redirection Notice

EXHIBIT VI Form of Custodial Delivery

EXHIBIT VII Form of Officer’s Certificate

EXHIBIT VIII Form of Confirmation

EXHIBIT IX Form of Servicer Notice and Agreement

MASTER REPURCHASE AGREEMENT, dated as of December 8, 2014, by and between ACRC LENDER C LLC, a Delaware limited liability company (“ACRC Seller”), and ACRC LENDER C TRS LLC, a Delaware limited liability company (“TRS Seller” and, together with ACRC Seller, individually and/or collectively as the context may require, “Seller”), as sellers, and CITIBANK, N.A., a national banking association (together with its successors and/or assigns, “Buyer”), as buyer.

WHEREAS, Seller and Buyer entered into that certain Master Loan and Security Agreement (the “Original Loan Agreement”), dated as of December 8, 2011, as amended by (1) that certain First Amendment to Master Loan and Security Agreement, dated as of April 16, 2012 (the “First Amendment”), (2) that certain Second Amendment to Master Loan and Security Agreement, dated as of July 12, 2013 (the “Second Amendment”), (3) that certain Third Amendment to Master Loan and Security Agreement, dated as of August 27, 2013 (the “Third Amendment”), and (4) that certain Fourth Amendment to Master Loan and Security Agreement, dated as of May 6, 2014 (the “Fourth Amendment”; together with the Original Loan Agreement, the First Amendment, the Second Amendment and the Third Amendment, collectively, the “Existing Loan Agreement”), between Seller and Buyer.

WHEREAS, Seller and Buyer desire to enter into this Agreement upon the terms and conditions hereinafter set forth, so as to restructure the Existing Loan Agreement into a master repurchase agreement, and to make certain other modifications as more fully set forth herein.

NOW, THEREFORE, Seller and Buyer hereby agree as follows:

1.APPLICABILITY

From time to time during the Facility Availability Period, the parties hereto may enter into transactions in which Seller agrees to transfer to Buyer Purchased Loans against the transfer of funds by Buyer, with a simultaneous agreement by Buyer to transfer to Seller such Purchased Loans at a date certain, against the transfer of funds by Seller. Each such transaction shall be referred to herein as a “Transaction” and, unless otherwise agreed in writing, shall be governed by this Agreement, including any supplemental terms or conditions contained in any exhibits identified herein as applicable hereunder.

2.DEFINITIONS

“Accelerated Repurchase Date” shall have the meaning specified in Section 14(b)(i) of this Agreement.

“Acceptable Hedge Counterparty” shall mean a Person that is regularly engaged in the business of entering into Interest Rate Protection Agreements and is reasonably acceptable to Buyer.

“Accepted Servicing Practices” shall have the meaning specified in Section 29(a) of this Agreement.

“ACRC Seller” shall have the meaning specified in the introductory paragraph hereof.

“ACRE Management” shall mean Ares Commercial Real Estate Management LLC, a Delaware limited liability company.

“Affiliate” shall mean, when used with respect to any specified Person, any other Person directly or indirectly Controlling, Controlled by, or under common Control with, such Person.

“Agreement” shall mean this Master Repurchase Agreement, dated as of December 8, 2014, by and between ACRC Lender C LLC, ACRC Lender C TRS LLC and Citibank, N.A., as the same may be amended, modified and/or restated from time to time.

“Anticipated Benchmark Replacement Date” shall have the meaning specified in Section 3(g)(v).

“Applicable Margin” shall have the meaning provided in the Fee Letter.

“Applicable SOFR” shall mean, with respect to each SOFR Based Transaction, either the SOFR Average or Term SOFR, as applicable, as designated in the related Confirmation.

“Appraisal” shall mean a FIRREA-compliant appraisal addressed to and reasonably satisfactory to Buyer of the related Mortgaged Property from an Independent Appraiser, which determines “as-is” appraised value at origination of the Eligible Loan utilizing a discounted cash flow analysis methodology, based on stabilized occupancy and a five to ten year projection period adjusted for fiscal year inflation and discounting..

“Assignment of Leases” shall mean, with respect to any Mortgage, an assignment of leases thereunder, notice of transfer or equivalent instrument in recordable form, sufficient under the laws of the jurisdiction wherein the Mortgaged Property is located to reflect the assignment of leases, subject to the terms, covenants and provisions of this Agreement.

“Balloon Payment” shall mean, for any Purchased Loan for which the final principal payment is substantially greater than periodic Scheduled Principal Payments due thereunder, the payment due on its maturity date.

“Bankruptcy Action” means, with respect to any Person, if such Person

(a) makes an assignment for the benefit of creditors,

(b) files a voluntary petition in bankruptcy,

(c) is adjudged a bankrupt or insolvent, or has entered against it an order for relief, in any bankruptcy or insolvency proceedings,

(d) consents to or files a petition or answer seeking for itself any reorganization, arrangement, composition, readjustment, liquidation, dissolution or similar relief under any statute, law or regulation,

(e) files an answer or other pleading admitting or failing to contest the material allegations of a petition filed against it in any bankruptcy or insolvency proceeding,

(f) seeks, consents to or acquiesces in the appointment of a trustee, receiver, liquidator, sequestrator, custodian or any similar official of or for such Person or of all or any substantial part of its properties,

(g) has not had a bankruptcy proceeding dismissed one hundred twenty (120) days after the commencement of any proceeding against such Person seeking reorganization, arrangement, composition, readjustment, liquidation, dissolution or similar relief under any statute, law or regulation,

(h) without such Person’s consent or acquiescence, has a trustee, receiver or liquidator be appointed with respect to such Person or of all or any substantial part of its properties, and such appointment is not vacated or stayed within ninety (90) days, or within ninety (90) days after the expiration of any such stay, the appointment is not vacated or

(i) takes any action in furtherance of any of the foregoing.

“Bankruptcy Code” shall mean Title 11 of the United States Code (11 U.S.C. § 101, et seq.), as amended, modified or replaced from time to time.

“Benchmark” shall mean, (a) for any SOFR Based Transaction for which the Applicable SOFR designated on the related Confirmation is the SOFR Average, initially, the SOFR Average and (b) for any SOFR Based Transaction for which the Applicable SOFR designated on the related Confirmation is Term SOFR, initially, Term SOFR; provided that if a Benchmark Transition Event or a SOFR Transition Event, as applicable, and its related Benchmark Replacement Date have occurred with respect to the then-current Benchmark or with respect to any Transaction, as applicable, then “Benchmark” shall mean, with respect to such then-current Benchmark or with respect to any applicable Transaction, as applicable, the related Benchmark Replacement. Notwithstanding the foregoing, if any setting of any Benchmark as provided above would result in such Benchmark setting being less than the applicable Benchmark Floor, such setting of such Benchmark shall instead be deemed to be such Benchmark Floor.

“Benchmark Floor” shall mean the greater of (a) 0.00% and (b) such higher amount as may be specified with respect to any Transaction in the related Confirmation.

“Benchmark Replacement” shall mean, with respect to any replacement of any then-current Benchmark under the terms of this Agreement, the sum of (a) the alternate benchmark rate that has been selected by Buyer giving due consideration to (i) any selection or recommendation of a replacement benchmark rate or the mechanism for determining such a rate by the Relevant Governmental Body or (ii) any evolving or then-prevailing market convention for determining a benchmark rate as a replacement for such Benchmark for U.S. dollar-denominated commercial mortgage loan repurchase facilities or other similar agreements at such

time and (b) the Benchmark Replacement Adjustment; provided, that such Unadjusted Benchmark Replacement is consistent with the benchmark rate selected by Buyer in its other commercial mortgage loan repurchase facilities with similarly situated counterparties and wherein Buyer has a similar contractual right; provided, further, that in connection with a SOFR Transition Event, such Unadjusted Benchmark Replacement shall be the SOFR Average or Term SOFR, as applicable (so long as no Benchmark Transition Event and Benchmark Replacement Date has occurred with respect to such rate), as determined by Buyer in its sole discretion. Notwithstanding the foregoing, if any setting of the Benchmark Replacement as provided above would result in such Benchmark Replacement setting being less than the applicable Benchmark Floor, such setting of the Benchmark Replacement shall instead be deemed to be such Benchmark Floor.

“Benchmark Replacement Adjustment” shall mean, with respect to any replacement of any then-current Benchmark under the terms of this Agreement, the spread adjustment, or method for calculating or determining such spread adjustment (which may be a positive or negative value or zero) that has been selected by Buyer giving due consideration to (a) any selection or recommendation of a spread adjustment, or method for calculating or determining such spread adjustment, for the replacement of such Benchmark with the applicable Unadjusted Benchmark Replacement by the Relevant Governmental Body or (b) any evolving or then-prevailing market convention for determining a spread adjustment, or method for calculating or determining such spread adjustment, for the replacement of such Benchmark with the applicable Unadjusted Benchmark Replacement for U.S. dollar-denominated commercial mortgage loan repurchase facilities at such time; provided, that such Benchmark Replacement Adjustment is consistent with the spread adjustment or method for calculating or determining such spread adjustment selected by Buyer for replacement of such Benchmark with the related Unadjusted Benchmark Replacement in its other commercial mortgage loan repurchase facilities with similarly situated counterparties and wherein Buyer has a similar contractual right.

“Benchmark Replacement Conforming Changes” shall mean, with respect to any Benchmark or Benchmark Replacement, any technical, administrative or operational changes (including, without limitation, changes to the definitions of “Pricing Rate Period”, “Pricing Rate Determination Date”, “Reference Time”, “SOFR Average”, “SOFR Based Transaction”, “Term SOFR” and any similar defined term in this Agreement, provisions with respect to timing and frequency of determining rates and making payments of interest or price differential, timing of transaction requests, future advance requests, conversion or continuation notices, length of lookback periods, the applicability of breakage provisions, the formula for calculating any benchmark rate (including, without limitation, SOFR, the SOFR Average and Term SOFR), the formula, methodology or convention for applying the successor Benchmark Floor to any benchmark rate (including, without limitation, SOFR, the SOFR Average and Term SOFR) and other technical, administrative or operational matters) that Buyer decides may be appropriate to reflect the adoption and implementation of such Benchmark or Benchmark Replacement, as applicable, and to permit the administration thereof by Buyer in a manner substantially consistent with market practice (or, if Buyer decides that adoption of any portion of such market practice is not administratively feasible or if Buyer determines that no market practice for the administration of such Benchmark or Benchmark Replacement, as applicable, exists, in such other manner of

administration as Buyer decides is reasonably necessary in connection with the administration of this Agreement and the other Transaction Documents).

“Benchmark Replacement Date” shall mean the earliest to occur of the following events with respect to the then-current Benchmark:

(1) in the case of clause (1) or (2) of the definition of “Benchmark Transition Event”, the later of (a) the date of the public statement or publication of information referenced therein and (b) the date on which the administrator of such Benchmark (or the published component used in the calculation thereof) permanently or indefinitely ceases to provide such Benchmark (or such component thereof);

(2) in the case of clause (3) of the definition of “Benchmark Transition Event”, the first date on which such Benchmark (or the published component used in the calculation thereof) has been determined and announced by the regulatory supervisor for the administrator of such Benchmark (or such component thereof) to be no longer representative or to be non-compliant with or non-aligned with the International Organization of Securities Commissions (IOSCO) Principles for Financial Benchmarks; provided, that such non-representativeness, non-compliance or non-alignment will be determined by reference to the most recent statement or publication referenced in such clause (3) even if such Benchmark (or such component thereof) continues to be provided on such date; or

(3) in the case of a SOFR Transition Event, the date set forth in the related Rate Election Notice provided to Seller.

For the avoidance of doubt, if the event giving rise to the Benchmark Replacement Date occurs on the same day as, but earlier than, the Reference Time in respect of any determination, the Benchmark Replacement Date will be deemed to have occurred prior to the Reference Time for such determination.

“Benchmark Transition Event” shall mean, with respect to any applicable Benchmark, the occurrence of one or more of the following events with respect to such Benchmark:

(1) a public statement or publication of information by or on behalf of the administrator of such Benchmark (or the published component used in the calculation thereof) announcing that such administrator has ceased or will cease to provide such Benchmark (or such component thereof), permanently or indefinitely, provided that, at the time of such statement or publication, there is no successor administrator that will continue to provide such Benchmark (or such component thereof);

(2) a public statement or publication of information by the regulatory supervisor for the administrator of such Benchmark (or the published component used in the calculation thereof), the Board of Governors of the Federal Reserve System, the Federal Reserve Bank of New York, an insolvency official with jurisdiction over the administrator for such Benchmark (or such component), a resolution authority with jurisdiction over the administrator for such Benchmark (or such component) or a court or an entity with similar insolvency or resolution authority over the

administrator for such Benchmark (or such component), which states that the administrator of such Benchmark (or such component) has ceased or will cease to provide such Benchmark (or such component thereof) permanently or indefinitely, provided that, at the time of such statement or publication, there is no successor administrator that will continue to provide the Benchmark (or such component thereof); or

(3) a public statement or publication of information by the regulatory supervisor for the administrator of such Benchmark (or the published component used in the calculation thereof) announcing that such Benchmark (or such component thereof) is not, or as of a specified future date will not be, representative or in compliance with or aligned with the International Organization of Securities Commissions (IOSCO) Principles for Financial Benchmarks.

“Benchmark Unavailability Period” shall mean, with respect to any Benchmark, the period (if any) during which Buyer determines that (a) adequate and reasonable means do not exist for ascertaining such Benchmark (including, without limitation, if the Benchmark (or the published component used in the calculation thereof) is the SOFR Average or Term SOFR, that the SOFR Average or Term SOFR, as applicable, cannot be determined in accordance with the definition thereof) or (b) it is unlawful to accrue Price Differential based on such Benchmark or to otherwise use such Benchmark to determine the applicable Price Differential due for any Pricing Rate Period.

“Blocked Account Agreement” means that certain Controlled Account Agreement with respect to the Buyer’s Account, dated as December 8, 2011, among Seller, Buyer and Controlled Account Bank.

“Business Day” shall mean a day other than (i) a Saturday or Sunday or (ii) a day in which the New York Stock Exchange, the Federal Reserve Bank of New York or Buyer is authorized or obligated by law or executive order to be closed.

“Buyer” shall mean Citibank, N.A., or any successor or assignhave the meaning specified in the introductory paragraph hereof.

“Buyer’s Account” shall mean a segregated interest bearing account established at Controlled Account Bank, in the name of Seller, pledged to Buyer and subject to the Blocked Account Agreement.

“Capital Lease Obligations” shall mean, for any Person, all obligations of such Person to pay rent or other amounts under a lease of (or other agreement conveying the right to use) Property to the extent such obligations are required to be classified and accounted for as a capital lease on a balance sheet of such Person under GAAP, and, for purposes of this Agreement, the amount of such obligations shall be the capitalized amount thereof, determined in accordance with GAAP.

“Capital Stock” shall mean any and all shares, interests, participations or other equivalents (however designated) of capital stock of a corporation, any and all equivalent equity

ownership interests in a Person which is not a corporation, including, without limitation, any and all member or other equivalent interests in any limited liability company, and any and all warrants or options to purchase any of the foregoing.

“CERCLA” shall mean the Comprehensive Environmental Response, Compensation, and Liability Act of 1980, as amended from time to time.

“Certified Operating Histories” shall have the meaning specified in Exhibit I.

“Change of Control” shall mean any of the following events shall have occurred without the prior approval of Buyer:

(i) ACRE Management is no longer the manager of substantially all (by face value) of the loan assets of Guarantor or if the Management Agreement is modified in any material respect;

(ii) any merger, reorganization or consolidation of ACRE Management where ACRE Management is not the surviving entity;

(iii) ACRE Management shall cease to be owned and controlled, directly or indirectly, by Ares Management LLC or one or more of its Affiliates; or

(iv) Guarantor shall cease to own and control, of record and beneficially, directly or indirectly, 100% of the Equity Interests of Seller.

“Closing Counsel” shall mean the attorney or law firm retained by Seller for the origination or closing of any Purchased Loan to be transferred hereunder.

“Closing Counsel Letter” shall mean a letter delivered to Buyer from the Closing Counsel with respect to any Purchased Loan in connection with the initial Funding Date for such Purchased Loan, which states that all documents required to be delivered to the Custodian in respect of such Purchased Loan pursuant to this Agreement and the Custodial Agreement (i) have been executed and delivered by the parties thereto (in partial reliance, if applicable, on an opinion of counsel to the applicable Mortgagor), (ii) are in the possession of such Closing Counsel and (iii) will be delivered to the Custodian within three (3) Business Days after the applicable Funding Date.

“Closing Data File” shall mean, with respect to any Purchased Loan as of any Funding Date, a computer file generated by Seller or Servicer and delivered to Buyer and Custodian, which provides, with respect to each Purchased Loan that is transferred or to be transferred to Buyer on such Funding Date, each of the data fields set forth on Exhibit II attached hereto and the information responsive to each such field, as well as any and all new, modified or updated information with respect to such Purchased Loan that has been provided to Buyer prior to the applicable Funding Date, in each case in a format that has previously been approved by Buyer and is otherwise acceptable to Buyer.

“Code” shall mean The Internal Revenue Code of 1986 and the regulations promulgated and rulings issued thereunder, in each case as amended, modified or replaced from time to time.

“Collateral” shall have the meaning specified in Section 6(b) of this Agreement.

“Collection Period” shall mean, with respect to any Payment Date, the period from and including the immediately preceding Payment Date to but excluding such Payment Date.

“Complete Submission” shall mean with respect to any Eligible Loan, the Summary Due Diligence Materials described on Annex 2 to Exhibit III hereto for the Eligible Loan proposed to be transferred to Buyer in accordance with, and subject to the terms and conditions of, this Agreement.

“Confirmation” shall have the meaning specified in Section 3(b) of this Agreement.

“Contractual Obligation” shall mean, with respect to any Person, any provision of any securities issued by such Person or any indenture, mortgage, deed of trust, deed to secure debt, contract, undertaking, agreement, instrument or other document to which such Person is a party or by which it or any of its property or assets are bound or are subject.

“Control” shall mean the possession, direct or indirect, of the power to direct or cause the direction of the management and policies of a Person, whether through the ownership of voting securities, by contract or otherwise and “Controlling” and “Controlled” shall have meanings correlative thereto.

“Controlled Account Agreement” shall mean, individually and/or collectively as the context may require, each of (i) a control agreement with respect to the Buyer’s Account, dated as of the date of this Agreement, among Seller, Buyer and Controlled Account Bank., as may be amended, modified, waived, supplemented, extended, restated or replaced from time to time in accordance with this Agreement, and (ii) any additional control agreement with respect to the Buyer’s Account entered into among Seller, Buyer and Controlled Account Bank which shall be in form and substance reasonably acceptable to Buyer.

“Controlled Account Bank” shall mean Bank of America, National Association, or any other bank approved by Buyer.

“Costs” shall have the meaning provided in Section 27(a) hereof.

“Custodial Agreement” shall mean the Custodial Agreement, dated as of December 8, 2011, by and among the Custodian, Seller and Buyer, as the same may be amended, modified and/or restated from time to time.

“Custodial Delivery” shall mean the form executed by Seller in order to deliver the Purchased Loan Schedule and the Purchased Loan File to Buyer or its designee (including the Custodian) pursuant to Section 7 hereof, a form of which is attached hereto as Exhibit VI.

“Custodian” shall mean U.S. Bank, National Association, a Delaware limited liability company, as Custodian under the Custodial Agreement, and its successors and permitted assigns thereunder.

“Debt Yield” shall mean, on any date with respect to any Purchased Loan, a fraction (expressed as a percentage) (A) the numerator of which is the Underwritten Net Cash Flow of the related Mortgaged Property or Mortgaged Properties, and (B) the denominator of which is the Purchase Price of such Purchased Loan on such date.

“Default” shall mean any event which, with the giving of notice, the passage of time, or both, would constitute an Event of Default.

“Delaware LLC Act” shall mean Chapter 18 of the Delaware Limited Liability Company Act, 6 Del. C. §§ 18-101 et seq., as amended.

“Direct Competitor” shall mean any of the Persons listed on Schedule I attached hereto as such Schedule I may be updated from time to time pursuant to a written notice delivered by Seller to Buyer in accordance with this Agreement; provided, that any such Person listed on Schedule 5 (including on any such written update) shall not be an Eligible Assignee of the type described in clause (a) of the definition of Eligible Assignee.

“Division/Series Transaction” shall mean, with respect to any Person that is a limited liability company organized under the laws of the State of Delaware, that any such Person (a) divides into two or more Persons (whether or not the original Person or Subsidiary thereof survives such division) or (b) creates, or reorganizes into, one or more series, in each case, as contemplated under the laws of the State of Delaware, including without limitation Section 18-217 of the Delaware LLC Act.

“Dollars” and “$” shall mean lawful money of the United States of America.

“Due Diligence Review” shall mean the performance by Buyer of any or all of the reviews permitted under Section 28 hereof with respect to any or all of the Purchased Loans as desired by Buyer from time to time.

“Early Repurchase Date” shall have the meaning specified in Section 3(d) of this Agreement.

“Effective Date” shall mean the date of this Agreement.

“Eligible Assignee” shall mean any of the following Persons designated by Buyer for purposes of Section 19(a): (a) a bank, financial institution, pension fund, insurance company or similar Person, an Affiliate of any of the foregoing, and an Affiliate of Buyer, and (b) any other Person to which Seller has consented; provided, that such consent of Seller shall not be unreasonably withheld, delayed or conditioned, except in the case of a Direct Competitor of Seller, and, provided further, Seller’s consent under this subsection (b) shall not be required at any time when an Event of Default exists. Such Person shall provide to Seller such duly executed IRS forms as Seller reasonably requests.

“Eligibility Breach” shall have the meaning provided in Section 5(k) hereof.

“Eligible Loan” shall mean a newly originated performing senior floating rate mortgage bridge loan (i.e., either a whole mortgage loan or an A note in an “A/B” structure) secured by a first lien which satisfies the following criteria:

(a) such loan has been approved by Buyer in its sole discretion prior to being transferred to Buyer hereunder,

(b) such loan conforms to the representations and warranties set forth in Exhibit I attached hereto (other than for exceptions approved by Buyer),

(c) such loan is secured by underlying real estate which is an Eligible Property Type,

(d) such loan has a term (inclusive of the exercise of all extension options) not longer than sixty (60) months, and

(e) such loan, at origination, has a Loan-to-Value Ratio equal to or less than 80.0%.

“Eligible Property Type” shall mean any of the following types of underlying real estate: (a) multi-family, (b) office, (c) retail, (d) hospitality, (e) industrial, (f) self-storage, (g) student housing or (h) additional types of real estate that may be approved by Buyer in its sole discretion from time to time.

“Environmental Law” shall mean, any federal, state, foreign or local statute, law, rule, regulation, ordinance, code, guideline, written policy and rule of common law now or hereafter in effect and in each case as amended, and any judicial or administrative interpretation thereof, including any judicial or administrative order, consent decree or judgment, relating to the environment, employee health and safety or Hazardous Materials, including, without limitation, CERCLA; RCRA; the Federal Water Pollution Control Act, 33 U.S.C. § 1251 et seq.; the Toxic Substances Control Act, 15 U.S.C. § 2601 et seq.; the Clean Air Act, 42 U.S.C. § 7401 et seq.; the Safe Drinking Water Act, 42 U.S.C. § 3803 et seq.; the Oil Pollution Act of 1990, 33 U.S.C. § 2701 et seq.; the Emergency Planning and Community Right-to-Know Act of 1986, 42 U.S.C. § 11001 et seq.; the Hazardous Material Transportation Act, 49 U.S.C. § 1801 et seq.; and the Occupational Safety and Health Act, 29 U.S.C. § 651 et seq.; and any state and local or foreign counterparts or equivalents, in each case as amended from time to time.

“EO13224” shall have the meaning provided in Section 10(n).

“Equity Interests” With respect to any Person, (a) any share, interest, participation and other equivalent (however denominated) of Capital Stock of (or other ownership, equity or profit interests in) such Person, (b) any warrant, option or other right for the purchase or other acquisition from such Person of any of the foregoing, (c) any security convertible into or exchangeable for any of the foregoing, and (d) any other ownership or profit interest in such Person (including partnership, member or trust interests therein), whether voting or nonvoting, and whether or not such share, warrant, option, right or other interest is authorized or otherwise existing on any date.

“ERISA” shall mean the Employee Retirement Income Security Act of 1974, as amended from time to time, and the regulations promulgated thereunder. Section references to ERISA are to ERISA, as in effect at the date of this Agreement and, as of the relevant date, any subsequent provisions of ERISA, amendatory thereof, supplemental thereto or substituted therefor.

“ERISA Affiliate” shall mean any corporation or trade or business that is a member of any group of organizations (i) described in Section 414(b) or (c) of the Code of which Seller is a member and (ii) solely for purposes of potential liability under Section 302 of ERISA and Section 412 of the Code and the lien created under Section 303(k) of ERISA and Section 430(k) of the Code, described in Section 414(m) or (o) of the Code of which Seller is a member.

“Event of Default” shall have the meaning specified in Section 14 of this Agreement.

“Excluded Taxes” shall have the meaning specified in Section 31(a) of this Agreement.

“Extension Fee” shall have the meaning provided in the Fee Letter.

“Facility Amount” shall have the meaning provided in the Fee Letter.

“Facility Availability Period” shall mean the period commencing on the date of this Agreement and ending on January 13, 2027 (or if such date is not a Business Day, the next succeeding Business Day).

“Facility Expiration Date” shall mean January 13, 2027 (or if such date is not a Business Day, the next succeeding Business Day); provided, that the Facility Expiration Date shall be extendable by Seller for up to two consecutive one-year periods, to the same date in the succeeding year (or if such date is not a Business Day, the next succeeding Business Day), subject to the following:

(a) Seller delivers to Buyer a written request of the extension of the Facility Expiration Date no earlier than ninety (90) nor later than thirty (30) days before the then current Facility Expiration Date,

(b) no Default or Event of Default exists on the date of the request to extend or on the then current Facility Expiration Date,

(c) no Margin Deficit exists that has not been satisfied on the then current Facility Expiration Date, and

(d) Seller shall have paid to Buyer the Extension Fee on the then current Facility Expiration Date.

“FATCA” means Sections 1471 through 1474 of the Code, as of the date of this Agreement (or any amended or successor version that is substantively comparable and not materially more onerous to comply with), any current or future regulations or official interpretations thereof, any agreements entered into pursuant to Section 1471(b)(1) of the Code

and any fiscal or regulatory legislation, rules or practices adopted pursuant to any intergovernmental agreement entered into in connection with the implementation of such sections of the Code.

“Fee Letter” shall mean the third amended and restated fee letter agreement, dated as of December 31, 2024, from Buyer and accepted and agreed to by Seller, as the same may be amended, modified and/or restated from time to time.

“FIRREA” shall mean the Financial Institutions, Reform, Recovery and Enforcement Act of 1989.

“Fitch” shall mean Fitch Ratings, Inc. and its successors and assigns.

“Funding Confirmation” shall have the meaning specified in Section 3(a)(iii) of this Agreement.

“Funding Date” shall mean the date on which a transfer of Purchase Price is made hereunder.

“GAAP” shall mean United States generally accepted accounting principles consistently applied as in effect from time to time.

“Governing Documents” shall mean as to any Person, its articles or certificate of incorporation and by-laws, its partnership agreement, its certificate of formation and operating agreement, and/or the other organizational or governing documents of such Person.

“Governmental Authority” shall mean any national or federal government, any state, regional, local or other political subdivision thereof with jurisdiction and any Person with jurisdiction exercising executive, legislative, judicial, regulatory or administrative functions of or pertaining to government.

“Ground Lease” shall mean any ground lease containing the following terms and conditions: (a) a remaining term (exclusive of any unexercised extension options) of twenty (20) years or more from the final stated maturity date of the related loan; (b) the right of the lessee to mortgage and encumber its interest in the leased property without the consent of the lessor or with such consent given; (c) the obligation of the lessor to give the holder of any mortgage lien on such leased property written notice of any defaults on the part of the lessee and agreement of such lessor that such lease will not be terminated until such holder has had a reasonable opportunity to cure or complete foreclosures, and fails to do so; (d) reasonable transferability of the lessee’s interest under such lease, including ability to sublease; and (e) such other rights customarily required by mortgagees making a loan secured by the interest of the holder of the leasehold estate demised pursuant to a ground lease.

“Guarantee Obligation” shall mean, as to any Person, any obligation of such Person directly or indirectly guaranteeing any Indebtedness of any other Person or in any manner providing for the payment of any Indebtedness of any other Person or otherwise protecting the

holder of such Indebtedness against loss (whether by virtue of partnership arrangements, by agreement to keep-well, to purchase assets, goods, securities or services, or to take-or-pay or otherwise); provided that the term “Guarantee” shall not include endorsements for collection or deposit in the ordinary course of business. The amount of any Guarantee of a Person shall be deemed to be an amount equal to the stated or determinable amount of the primary obligation in respect of which such Guarantee is made or, if not stated or determinable, the maximum reasonably anticipated liability in respect thereof as determined by such Person in good faith. The terms “Guarantee” and “Guaranteed” used as verbs shall have correlative meanings.

“Guarantor” shall mean Ares Commercial Real Estate Corporation, a Maryland corporation.

“Guaranty” shall mean that certain Second Amended and Restated Substitute Guaranty Agreement, dated as of December 13, 2018, from Guarantor in favor of Buyer, as the same may be amended, modified, supplemented and/or restated from time to time.

“Hospitality Property” shall mean a real estate development the primary usage of which is as a hotel or motel with individual rooms principally for short-term rental to tenants occupying same.

“In Lieu of Policy” shall have the meaning specified in Exhibit I hereto.

“Income” shall mean, with respect to any Purchased Loan at any time, the sum of (x) any principal paid by or on behalf of Seller and all interest, thereon and (y) all net sale proceeds of a sale of such Purchased Loan. Notwithstanding the foregoing, “Income” shall be deemed not to include any fees or other amounts (i) payable to the Servicer under the Servicing Agreement, in the form of prepayment fees, extension fees, exit fees, defeasance fees, transfer fees, make-whole fees, late charges, late fees, and all other fees or charges, and (ii) that are not applied in reduction of principal or to the payment of interest thereon (including, without limitation, due diligence and legal or underwriting cost deposits, yield maintenance charges, penalties, default interest, dividends, gains, receipts, allocations, rents, interests, profits, payments in kind or returns or repayment of contributions, net sale, foreclosure, liquidation, securitization or other disposition proceeds, insurance payments, settlements and proceeds).

“Indebtedness” shall mean, for any Person at any date, without duplication, (a) all then outstanding indebtedness of such Person for borrowed money (whether by loan or the issuance and sale of debt securities) or for the deferred purchase price of property or services (other than current trade liabilities incurred in the ordinary course of business and payable in accordance with customary practices), (b) any other then outstanding indebtedness of such Person which is evidenced by a note, bond, debenture or similar instrument, (c) all Capital Lease Obligations, (d) all then outstanding obligations of such Person in respect of letters of credit, acceptances or similar instruments issued or created for the account of such Person and (e) all then outstanding liabilities secured by any Lien on any property owned by such Person even though such Person has not assumed or otherwise become liable for the payment thereof; provided, that “Indebtedness” shall be determined without regard to the effects of consolidation of any issuer of a Specified Third Party Securitization on the financial statements of such Person under

Accounting Standards Codification Section 810, as amended, modified or supplemented from time to time, or otherwise under GAAP.

“Indemnified Party” shall have the meaning specified in Section 27 of this Agreement.

“Independent Appraiser” shall mean an independent professional real estate appraiser reasonably satisfactory to Buyer who is a member in good standing of the American Appraisal Institute, and, if the state in which the subject Mortgaged Property is located certifies or licenses appraisers, is certified or licensed in such state, and in each such case, who has a minimum of five years experience in the subject property type.

“Independent Director” shall mean a duly appointed manager or member of the board of directors (or managers) of the relevant entity who shall not have been, at the time of such appointment or at any time while serving as a director or manager of the relevant entity and may not have been at any time in the preceding five (5) years, (a) a direct or indirect legal or beneficial owner in such entity or any of its Affiliates, (b) a creditor, supplier, employee, officer, director (other than in its capacity as Independent Director), family member, manager or contractor (other than in its capacity as an Independent Director) of such entity or any of its Affiliates, or (c) a Person who controls (directly, indirectly or otherwise) such entity or any of its Affiliates or any creditor, supplier, employee, officer, director, family member, manager or contractor of such Person or any of its Affiliates.

“Initial Advance Percentage” shall mean, with respect to any Purchased Loan, the percentage equal to the quotient of the initial Purchase Price transferred by Buyer in connection with a Transaction divided by the outstanding principal amount of such Purchased Loan as of the Purchase Date on which such Purchased Loan was first transferred to Buyer hereunder.

“Initial Purchase Price Percentage” shall mean, with respect to any Purchased Loan, the percentage equal to the quotient of the initial Purchase Price transferred by Buyer in connection with a Transaction divided by the outstanding principal amount of such Purchased Loan as of the Purchase Date on which such Purchased Loan was first transferred to Buyer hereunder.

“Interest Rate Protection Agreement” shall mean, with respect to any or all of the Purchased Loans, any short sale of U.S. Treasury Securities, futures contract, mortgage related security, Eurodollar futures contract, options related contract, interest rate swap, cap or collar agreement or similar arrangement providing for protection against fluctuations in interest rates or the exchange of nominal interest obligations, either generally or under specific contingencies, entered into by Seller and an Acceptable Hedge Counterparty and otherwise reasonably acceptable to Buyer.

“Irrevocable Redirection Notice” shall mean a notice in the form of Exhibit V sent after the occurrence and during the continuance of an Event of Default directing the remittance of Income with respect to a Purchased Loan to the Buyer’s Account, and executed by the Seller with respect to such Purchased Loan.

“Junior Interest” shall mean (a) a “B-note” in an “A/B structure” in a Purchased Loan, or (b) any other debt subordinate to a Purchased Loan transferred hereunder that is secured by (i) all or any portion of the Mortgaged Property and/or (ii) direct or indirect Equity Interests in the applicable Mortgagor.

“Lien” shall mean any mortgage, lien, encumbrance, charge or other security interest, whether arising under contract, by operation of law, judicial process or otherwise.

“Loan-to-Value Ratio” or “LTV” shall mean, as of the initial Funding Date in respect of any Purchased Loan, the ratio of (a) the outstanding principal amount of such Purchased Loan at such time (and specifically including for this purpose the unpaid principal amount of all Junior Interests) to (b) the market value of the related Mortgaged Property at such time, as determined by reference to a third-party Appraisal of such Mortgaged Property.

“Management Agreement” shall mean that certain Interim Management Agreement, dated as of December 8, 2011, between Guarantor and ACRE Management, as amended, modified, waived, supplemented, extended, restated or replaced from time to time.

“Margin Amount” shall mean, with respect to any Purchased Loan as of any date of determination, an amount equal to the product of the Margin Percentage and the outstanding Purchase Price of such Purchased Loan as of such date.

“Margin Deficit” shall have the meaning specified in Section 4(a) hereof.

“Margin Percentage” shall mean, with respect to any Purchased Loan as of any date of determination, the reciprocal of the applicable Initial Purchase Price Percentage.

“Market Disruption Event” shall mean any event or events which, as determined by Buyer, acting in a reasonable manner, shall have resulted in (i) the effective absence of a “lending market” for financing debt obligations secured by commercial mortgage loans, (ii) Buyer not being able to finance mortgage assets through the “lending market” with traditional counterparties at rates which would have been reasonable prior to the occurrence of such event or events, (iii) the effective absence of a “securities market” for securities backed by mortgage assets or (iv) Buyer not being able to sell securities backed by mortgage assets at prices which would have been reasonable prior to the occurrence of such event or events.

“Market Value” shall mean, with respect to any Purchased Loan as of any relevant date, the lesser of (x) 100% of the outstanding principal balance of such Purchased Loan and (y) the market value for such Purchased Loan on such date, as determined by Buyer in its commercially reasonable judgment; provided, that such market value may be adjusted from time to time if Buyer determines that any of the following events or any similar event, occurrence or condition (each, a “Credit Event”) has occurred:

(a) the deterioration in value of any Mortgaged Property relating to any Purchased Loan (other than due to fluctuations in current interest rates and spreads);

(b) any drop in the net operating income or cash flow of any Purchased Loan or the Mortgaged Property related thereto which causes the Debt Yield to decline;

(c) the loss of any security interest under any document executed in connection with any Purchased Loan;

(d) Seller fails to deliver the Purchased Loan File to the Custodian within the applicable time periods provided in the Custodial Agreement subject to any applicable cure periods set forth therein;

(e) any statement, affirmation or certification made or information, document, agreement, report or notice delivered by Seller to Buyer is untrue in any material respect; and

(f) Buyer determines that a Material Adverse Effect has occurred or that such Purchased Loan is otherwise unlikely to be collectible on a timely basis (other than due to fluctuations in current interest rates and spreads).

“Material Adverse Effect” shall mean a material adverse effect on (a) the Property, business, operations, financial condition or prospects of Seller or Guarantor, (b) the ability of Seller or Guarantor to perform its obligations under any of the Transaction Documents to which it is a party, (c) the validity or enforceability of any of the Transaction Documents, (d) the rights and remedies of Buyer under any of the Transaction Documents, (e) the timely payment of the principal of or interest on the Purchased Loans or other amounts payable in connection therewith or (f) the Collateral taken as a whole.

“Maximum Transaction Amount” shall mean with respect to any individual Purchased Loan, $75,000,000.

“Minimum Individual Purchased Loan Debt Yield” shall mean, with respect to each Eligible Loan secured by the type of Mortgaged Property set forth in the left hand column below, the Debt Yield set forth in the right hand column below:

| Type of Mortgaged Property | Debt Yield |
| --- | --- |
| Multi-family | 7.00% |
| Hospitality | 9.00% |
| All types other than multi-family or hospitality | 8.00% |

“Minimum Portfolio Debt Yield” shall mean as of any date of determination, with respect to all Purchased Loans (excluding those Purchased Loans for which the Purchase Date occurred within twelve (12) months of such date of determination) on a weighted average basis (weighted by outstanding Purchase Price with respect to each Purchased Loan individually), 8.00%.

“Moody’s” shall mean Moody’s Investors Service, Inc.

“Mortgage” shall mean a mortgage, deed of trust, deed to secure debt or other instrument, creating a valid and enforceable first lien on or a first priority ownership interest in an estate in fee simple in real property and the improvements thereon, securing a mortgage note or similar evidence of indebtedness.

“Mortgage Asset Report” shall have the meaning specified in Section 12(l).

“Mortgage Loan” shall mean a first mortgage loan on one or more multi-family or commercial real estate properties which is originated by Seller and which first mortgage loan is evidenced by a Mortgage Note and secured by one or more Mortgages.

“Mortgage Note” shall mean a note or other evidence of indebtedness of a Mortgagor secured by a Mortgage in connection with a Purchased Loan.

“Mortgaged Property” shall mean the real property securing repayment of the debt evidenced by a Mortgage Note.

“Mortgagee” shall mean the record holder of a Mortgage Note secured by a Mortgage.

“Mortgagor” shall mean the obligor on a Mortgage Note and the grantor of the related Mortgage.

“Multiemployer Plan” shall mean a multiemployer plan defined as such in Section 3(37) of ERISA to which contributions have been, or were required to have been, made by Seller or any ERISA Affiliate during the preceding five plan years and which is covered by Title IV of ERISA.

“Non-Excluded Taxes” shall have the meaning provided in Section 31(a) hereof.

“Non-U.S. Person” shall have the meaning provided in Section 31(b).

“OFAC List” shall mean the Specially Designated Nationals list maintained by the U.S. Department of Treasury, Office of Foreign Assets Control (OFAC).

“Payment Date” shall mean the fifteenth (15th) day of each calendar month, or if such day is not a Business Day, the next succeeding Business Day

“PBGC” shall mean the Pension Benefit Parent Guarantee Corporation or any entity succeeding to any or all of its functions under ERISA.

“Person” shall mean an individual, corporation, limited liability company, business trust, partnership, joint tenant or tenant-in-common, trust, unincorporated organization, or other entity, or a federal, state or local government or any agency or political subdivision thereof.

“Plan” shall mean an employee benefit or other plan established or maintained by Seller or any ERISA Affiliate during the five year period ended prior to the date of this Agreement or to which Seller or any ERISA Affiliate makes, is obligated to make or has, within the five year

period ended prior to the date of this Agreement, been required to make contributions and that is covered by Title IV of ERISA or Section 302 of ERISA or Section 412 of the Code, other than a Multiemployer Plan.

“Plan Party” shall have the meaning specified in Section 22(a) of this Agreement.

“Pledge and Security Agreement” shall mean, individually and/or collectively as the context may require, each of (i) the Pledge and Security Agreement, dated as of November 4, 2024, between Buyer and ACRC 2017-FL3 Holder REIT LLC, a Delaware limited liability company, as may be amended, modified, waived, supplemented, extended, restated or replaced from time to time., and (ii) the Pledge and Security Agreement, dated as of June 9, 2026, between Buyer and ACRC Lender TRS LLC, a Delaware limited liability company, as may be amended, modified, waived, supplemented, extended, restated or replaced from time to time.

“Pledged Collateral” shall have the meaning given to such term in the applicable Pledge and Security Agreement.

“Post-Default Rate” shall mean, in respect of the Repurchase Price of any Transaction under this Agreement that is not paid when due to Buyer (whether by acceleration, by optional or mandatory prepayment or otherwise), a rate per annum during the period from and including the due date to but excluding the date on which such amount is paid in full equal to the Pricing Rate otherwise applicable hereunder plus 4%.

“Preliminary Data File” shall mean a file containing the fields set forth in Exhibit II to this Agreement.

“Price Differential” shall mean, with respect to any Transaction as of any date, the aggregate amount obtained by daily application of the Pricing Rate for such Transaction to the outstanding Purchase Price for such Transaction on a 360-day-per-year basis for the actual number of days during the period commencing on (and including) the Purchase Date for such Transaction and ending on (but excluding) the date of determination (reduced by any amount of such Price Differential previously paid by Seller to Buyer with respect to such Transaction).

“Pricing Rate” shall mean, for any Pricing Rate Period, an annual rate equal to the sum of (i) the Benchmark plus (ii) the Applicable Margin, in each case, for the applicable Pricing Rate Period for the related Purchased Loan (subject to adjustment and/or conversion as provided in Section 3(g) of this Agreement).

“Pricing Rate Determination Date” shall mean, (a) with respect to any SOFR Based Transaction, the SOFR Based Pricing Rate Determination Date and (c) with respect to any Transaction that is not a SOFR Based Transaction, the date on which the Pricing Rate is to be set, as determined by Buyer in accordance with the Benchmark Replacement Conforming Changes.

“Pricing Rate Period” means, with respect to each Transaction, for each Payment Date, the period commencing on and including the fifteenth (15th) day of the calendar month

immediately prior to the calendar month of such Payment Date and ending on (and including) the fourteenth (14th) day of the calendar month immediately prior to the calendar month of such Payment Date; provided that the initial Pricing Rate Period in respect of any Transaction shall be the period from and including the date of such Transaction to and including the last day of the following calendar month and any Pricing Rate Period that would end after the Repurchase Date for any Purchased Loan shall end on such Repurchase Date.

“Pricing Rate Reset Date” shall mean, (a) in the case of the first Pricing Rate Period for any Purchased Loan, the Funding Date for such Purchased Loan, and (b) in the case of any subsequent Pricing Rate Period, two (2) Business Days prior to the Payment Date on which such Pricing Rate Period begins.

“Principal Prepayment” shall mean, for any Purchased Loan, (i) any amount applied to reduce the principal or other invested amount of such Purchased Loan, other than a Scheduled Principal Payment, including, without limitation, (i) principal prepayments from any source and of any nature whatsoever, (ii) net insurance or net condemnation proceeds, to the extent applied to reduce the principal amount or other invested amount of the related Purchased Loan, and (iii) any net proceeds from any sale, refinancing, liquidation or other disposition of the underlying Mortgaged Property or underlying interest relating to such Purchased Loan to the extent applied to reduce the principal amount or the invested amount of the related Purchased Loan.

“Prohibited Person” shall have the meaning specified in Section 10(o).

“Property” shall mean any right or interest in or to property of any kind whatsoever, whether real, personal or mixed and whether tangible or intangible.

“Purchase Date” shall mean the initial Funding Date on which a Purchased Loan is transferred by Seller to Buyer.

“Purchase Price” shall mean, with respect to any Purchased Loan, (x) as of any Funding Date for such Purchased Loan, the amount determined pursuant to Section 3(a)(v) and (vi); and (y) thereafter, such amount referred to in clause (x), reduced by any amount applied to reduce the Purchase Price pursuant to Section 4(a) or 5 of this Agreement.

“Purchased Loan” shall mean, with respect to any individual Transaction, the Eligible Loan sold by Seller to Buyer in such Transaction and “Purchased Loans” shall mean, with respect to the Transactions involving Purchased Loans in general, all Eligible Loans sold by Seller to Buyer.

“Purchased Loan Documents” shall mean, with respect to a Purchased Loan, the documents comprising the Purchased Loan File for such Purchased Loan.

“Purchased Loan Event of Default” shall mean an “Event of Default” as such term is used and defined in the Purchased Loan Documents for any Purchased Loan.

“Purchased Loan File” shall mean, with respect to a Purchased Loan, the documents specified as the “Mortgage Loan File” in the Custodial Agreement.

“Purchased Loan Schedule” shall mean a schedule of Purchased Loans attached to each Trust Receipt and Custodial Delivery.

“Rate Election Notice” shall mean, the written notice of the election by Buyer, in its sole discretion, to declare that a “SOFR Transition Event” shall occur, which Rate Election Notice shall designate the affected Benchmark, the applicable Benchmark Replacement Date and whether the applicable Unadjusted Benchmark Replacement shall be the SOFR Average or Term SOFR.

“RCRA” shall mean the Resource Conservation and Recovery Act of 1976, as amended from time to time.

“Reference Time” shall mean, with respect to any setting of the then-current Benchmark for each Pricing Rate Period, (a) if such Benchmark is the SOFR Average or Term SOFR, 3:00 p.m. (New York city) time on the SOFR Based Pricing Rate Determination Date and (b) if such Benchmark is not the SOFR Average or Term SOFR, then the time determined by Buyer in accordance with the Benchmark Replacement Conforming Changes.

“Registrar” shall have the meaning provided in Section 19(a)(iv) hereof.

“Regulations T, U and X” shall mean Regulations T, U and X of the Board of Governors of the Federal Reserve System (or any successor), as the same may be modified and supplemented and in effect from time to time.

“Relevant Governmental Body” shall mean the Board of Governors of the Federal Reserve System or the Federal Reserve Bank of New York, or a committee officially endorsed or convened by the Board of Governors of the Federal Reserve System or the Federal Reserve Bank of New York, or any successor thereto.

“Remaining Paydown Amount” shall have the meaning specified in Section 5(i).

“REMIC” shall mean a real estate mortgage investment conduit, within the meaning of Section 860D(a) of the Code.

“Reportable Event” shall mean a reportable event as defined in Title IV of ERISA, except actions of general applicability by the Secretary of Labor under Section 110 of ERISA.

“Repurchase Date” shall mean, with respect to each Purchased Loan, the earlier of: (x) the Facility Expiration Date, or (y) the maturity date of such Purchased Loan (subject to extension, if applicable, in accordance with its Purchased Loan Documents).

“Repurchase Price” shall mean, with respect to any Purchased Loan as of any date, the price at which such Purchased Loan is to be transferred from Buyer to Seller upon termination of the related Transaction; such price will be determined in each case as the sum of (a) the

outstanding Purchase Price of such Purchased Loan, (b) the accrued but unpaid Price Differential thereon with respect to such Purchased Loan as of such date and (c) all other amounts due and payable as of such date by Seller to Buyer under this Agreement or any Transaction Document with respect to such Purchased Loan (including, but not limited to, accrued and unpaid fees, expenses and indemnity amounts).

“Request for Transaction/Increase in Purchase Price” shall have the meaning provided in Section 3(a)(ii) hereof.

“Requirement of Law” shall mean as to any Person, the certificate of incorporation and by-laws or other organizational or Governing Documents of such Person, and any law, treaty, rule or regulation or determination of an arbitrator or a court or other Governmental Authority, in each case applicable to or binding upon such Person or any of its property or to which such Person or any of its property is subject.

“Responsible Officer” shall mean, with respect to any Person, the chief executive officer, the chief financial officer, the chief accounting officer, the treasurer or the chief operating officer of such Person or such other officer designated as an authorized signatory in such Person’s Governing Documents.

“S&P” shall mean Standard & Poor’s Ratings Services, a division of The McGraw-Hill Companies, Inc.

“Scheduled Principal Payment” shall mean any payment of principal on a Purchased Loan that is required, pursuant to the Purchased Loan Documents for such Purchased Loan as modified by any amendments thereto, to be made at a specific time or upon the happening of a specific event, other than a Balloon Payment.

“Secured Obligations” shall have the meaning specified in Section 6(b).

“Seller” shall mean ACRC Lender C LLC, a Delaware limited liability companyhave the meaning specified in the introductory paragraph hereof.

“Servicer” shall have the meaning provided in Section 29(c).

“Servicer Notice and Agreement” shall have the meaning provided in Section 29(c) hereof.

“Servicer’s Account” shall mean an account established by Servicer in connection with the servicing of any Purchased Loan.

“Servicing Agreement” shall have the meaning provided in Section 12(g).mean that certain Servicing and Asset Management Agreement, dated as of July 1, 2025, by and among Trimont LLC, as servicer, Seller and each other party joined thereto as a “Client” from time to time, and Ares Commercial Real Estate Servicer LLC, as special servicer, as same may be amended, modified and/or restated, or any replacement thereof with a successor Servicer, which replacement servicing agreement shall be reasonably acceptable to Buyer.

“Servicing Records” shall have the meaning provided in Section 29(b) hereof.

“Servicing Rights” shall mean Seller’s right, title and interest in and to any and all of the following: (a) any and all rights to service the related Purchased Loan; (b) any payments to or monies received by such Seller or any other Person for servicing such Purchased Loan; (c) any late fees, penalties or similar payments with respect to such Purchased Loan; (d) all agreements or documents creating, defining or evidencing any such servicing rights to the extent they relate to such servicing rights and all rights of such Seller or any other Person thereunder; (e) escrow payments or other similar payments with respect to such Purchased Loan and any amounts actually collected by such Seller or any other Person with respect thereto; (f) the right, if any, to appoint a special servicer or liquidator of such Purchased Loan; and (g) all accounts and other rights to payment related to the servicing of such Purchased Loan.

“Servicing Transfer Event” shall mean the event where the Servicer no longer (i) has a servicer rating of “Average” or higher from S&P, (ii) has a servicer rating of “CPS3” or higher from Fitch or (iii) is on the list of approved servicers maintained by Moody’s.

“Significant Purchased Loan Modification” means any written modification or amendment of a Purchased Loan transferred to Buyer hereunder which

(A) reduces the principal amount of the Purchased Loan in question other than (1) with respect to a dollar-for-dollar principal payment or (2) reductions of principal to the extent of deferred, accrued or capitalized interest added to principal which additional amount was not taken into account by Buyer in determining the related Debt Yield,

(B) increases the principal amount of a Purchased Loan other than increases which are derived from accrual or capitalization of deferred interest which is added to principal or protective advances,

(C) modifies the amount or timing of any regularly scheduled payments of principal and non-contingent interest of the Purchased Loan in question,

(D) changes the frequency of scheduled payments of principal and interest in respect of a Purchased Loan,

(E) subordinates the lien priority of the Purchased Loan in question or the payment priority of the Purchased Loan in question other than subordinations required under the then existing terms and conditions of the Purchased Loan in question (provided, however, the foregoing shall not preclude the execution and delivery of subordination, nondisturbance and attornment agreements with tenants, subordination to tenant leases, easements, plats of subdivision and condominium declarations and similar instruments which in the commercially reasonable judgment of Seller do not materially adversely affect the rights and interest of the holder of the Purchased Loan in question),

(F) releases any collateral for the Purchased Loan in question other than releases required under the then existing Purchased Loan Documents or releases in connection with eminent domain or under threat of eminent domain,

(G) waives, amends or modifies any cash management or reserve account requirements of the Purchased Loan other than changes required under the then existing Purchased Loan Documents, or

(H) waives any due-on-sale or due-on-encumbrance provisions of the Purchased Loan in question other than waivers required to be given under the then existing Purchased Loan documents, or

(I) waives, amends or modifies the underlying insurance requirements of the Purchased Loan.

“Single Employer Plan” shall mean as to any Person any Plan of such Person which is not a Multiemployer Plan.

“SOFR” shall mean the secured overnight financing rate as administered by the SOFR Administrator.

“SOFR Administrator” shall mean the Federal Reserve Bank of New York (or a successor administrator of the secured overnight financing rate).

“SOFR Administrator’s Website” shall mean the website of the Federal Reserve Bank of New York, currently at http://www.newyorkfed.org, or any successor source for the secured overnight financing rate identified as such by the SOFR Administrator from time to time.

“SOFR Average” shall mean the compounded average of SOFR over a rolling calendar day period of thirty (30) days (“30-Day SOFR Average”) which, with respect to the setting of such rate with respect to each Pricing Rate Period, shall be the 30-Day SOFR Average (expressed as a percentage per annum and rounded upward, if necessary, to the next nearest 1/1000 of 1%) published by the SOFR Administrator on the SOFR Administrator’s Website for the related Reference Time; provided, however, that if, as of such Reference Time, the 30-Day SOFR Average has not been published on the SOFR Administrator’s Website, the SOFR Average for such setting will be 30-Day SOFR Average as published on the SOFR Administrator’s Website for the first preceding U.S. Government Securities Business Day for which such 30-Day SOFR Average was published on the SOFR Administrator’s Website so long as such first preceding U.S. Government Securities Business Day is not more than three (3) U.S. Government Securities Business Days prior to the related SOFR Based Pricing Rate Determination Date. Notwithstanding the foregoing, if any setting of the SOFR Average as provided above would result in such setting being less than the applicable Benchmark Floor, such setting of the SOFR Average shall instead be deemed to be such Benchmark Floor.

“SOFR Based Pricing Rate Determination Date” shall mean, (a) in the case of the first Pricing Rate Period for any Purchased Loan, two (2) U.S. Government Securities Business Days prior to the related Purchase Date for such Purchased Loan, and (b) in the case of each subsequent Pricing Period, two (2) U.S. Government Securities Business Days preceding the first day of such Pricing Rate Period.

“SOFR Based Transaction” shall mean any Transaction for which the Benchmark (or the published component used in the calculation thereof) designated in the related Transaction (or as a result of the occurrence of a Benchmark Transition Event or SOFR Transition Event, as applicable, and the related Benchmark Replacement Date) is either the SOFR Average or Term SOFR.

“SOFR Transition Event” shall mean, the occurrence of:

(1) a determination by Buyer to convert all Transactions using an applicable Benchmark to a Benchmark Replacement; and

(2) the provision by Buyer of the applicable Rate Election Notice to Seller.

“Solvent” shall mean with respect to any Person at any time, having a state of affairs such that all of the following conditions are met at such time: (a) the fair value of the assets and property of such Person is greater than the amount of such Person’s liabilities (including disputed, contingent and unliquidated liabilities) as such value is established and liabilities evaluated for purposes of Section 101(32) of the Bankruptcy Code, (b) the present fair salable value of the assets and property of such Person in an orderly liquidation of such Person is not less than the amount that will be required to pay the probable liability of such Person on its debts as they become absolute and matured, and (c) such Person is not engaged in a business or a transaction, and is not about to engage in a business or a transaction, for which such Person’s assets and property would constitute unreasonably small capital.

“Special Purpose Bankruptcy Remote Entity” shall have the meaning specified in Section 13.

“Specified Third Party Securitization” means any securitization transaction that was not established or sponsored by Guarantor or any of its consolidated Subsidiaries.

“Subsidiary” shall mean, with respect to any Person, any corporation, partnership or other entity of which at least a majority of the securities or other ownership interests having by the terms thereof ordinary voting power to elect a majority of the board of directors or other persons performing similar functions of such corporation, partnership or other entity (irrespective of whether or not at the time securities or other ownership interests of any other class or classes of such corporation, partnership or other entity shall have or might have voting power by reason of the happening of any contingency) is at the time directly or indirectly owned or controlled by such Person or one or more Subsidiaries of such Person or by such Person and one or more Subsidiaries of such Person.

“Summary Due Diligence Materials” shall mean those materials described on Annex 2 to Exhibit III.

“System” shall mean all hardware or software, or any system consisting of one or more thereof, including, without limitation, any and all enhancements, upgrades, customizations, modifications and the like utilized by any Person for the benefit of such Person to perform its

obligations and to administer and track, store, process, provide, and where appropriate, insert, true and accurate dates and calculations for dates and spans with respect to the Purchased Loan.

“Table-Funded Eligible Loan” shall mean an Eligible Loan originated by Seller and transferred to Buyer simultaneously with the origination thereof by Seller, and which origination is financed in part with the Purchase Price of a Transaction hereunder.

“Taxes” shall have the meaning specified in Section 31(a) hereof.

“Term SOFR” shall mean, the forward-looking term rate based on SOFR with a tenor of one month (the “Term SOFR Reference Rate”) which, with respect to the setting of such rate with respect to each Pricing Rate Period, shall be the Term SOFR Reference Rate (expressed as a percentage per annum and rounded upward, if necessary, to the next nearest 1/1000 of 1%) published by the Term SOFR Administrator as of the related Reference Time; provided, however, that if, as of the such Reference Time, the Term SOFR Reference Rate has not been published by the Term SOFR Administrator then Term SOFR will be the Term SOFR Reference Rate for such tenor as published by the Term SOFR Administrator on the first preceding U.S. Government Securities Business Day for which such Term SOFR Reference Rate was published by the Term SOFR Administrator so long as such first preceding U.S. Government Securities Business Day is not more than three (3) U.S. Government Securities Business Days prior to the related SOFR Based Pricing Rate Determination Date. Notwithstanding the foregoing, if any setting of Term SOFR as provided above would result in such setting being less than the applicable Benchmark Floor, such setting of Term SOFR shall instead be deemed to be such Benchmark Floor.

“Term SOFR Administrator” shall mean CME Group Benchmark Administration Limited (CBA), or a successor administrator of the Term SOFR Reference Rate selected by Buyer in its reasonable discretion.

“Testing Date” shall have the meaning specified in Exhibit I hereof.

“Title Escrow Letter” shall mean with respect to any Purchased Loan, a letter agreement in such form as shall be reasonably acceptable to Buyer, executed by the title insurance company obligating it to issue title insurance insuring the lien of the Mortgage for such Purchased Loan as reflected in an attached marked-up title commitment and to record or file such Mortgage and other certain security instruments securing such Purchased Loan and addressing the mechanics of funding of such Purchased Loan.

“Title Exceptions” shall have the meaning specified in Exhibit I hereof.

“Title Policy” shall have the meaning specified in Exhibit I(11).

“Transaction” shall have the meaning set forth in Section 1.

“Transaction Documents” shall mean, collectively, this Agreement, any applicable Annexes to this Agreement, the Guaranty, the Pledge and Security Agreement, the Custodial

Agreement, the Blocked Account Agreement, any Servicing Agreement, all Confirmations executed pursuant to this Agreement in connection with specific Transactions, the Fee Letter, any and all other documents and agreements relating to any such documents executed by Seller or Guarantor, and any written modifications, extensions, renewals, restatements, or replacements of any of the foregoing.

“TRS Seller” shall have the meaning specified in the introductory paragraph hereof.

“Trust Receipt” shall have the meaning assigned to such terms in the Custodial Agreement.

“UCC” shall mean the New York Uniform Commercial Code.

“UCC Financing Statement” shall mean a financing statement on Form UCC-1 or the proper national UCC form, naming Buyer as “Secured Party” and Seller as “Debtor” and describing the Purchased Loans.

“Unadjusted Benchmark Replacement” shall mean the applicable Benchmark Replacement excluding the related Benchmark Replacement Adjustment.

“Underwritten Net Cash Flow” shall mean, with respect to any Purchased Loan, in place or pro forma underwritten net cash flow from the Mortgaged Property securing such Purchased Loan, as determined by Buyer in its sole discretion (a) in connection with the Purchase Date on which an Eligible Loan is first made the subject of a Transaction with Buyer hereunder, (b) in connection with any request from Seller to Buyer to fund a portion of any future advance which Seller is contractually obligated to fund (or any reborrowing of a prior initial advance or future advance which has been prepaid by Seller), and (c) for purposes of the application of Balloon Payments, Scheduled Principal Payments, Principal Prepayments and net sale proceeds in the event of a sale of a Purchased Loan made pursuant to Section 5(i) of this Agreement, in each case subject to adjustments for, but not limited to, (i) a vacancy allowance, (ii) projected increases in expenses, (iii) mark-to-market of in place rents and exclusion of non-sustainable income, (iv) market management fees and (v) normalized reserves.

“U.S. Government Securities Business Day” shall mean any day except for (a) a Saturday, (b) a Sunday or (c) a day on which the Securities Industry and Financial Markets Association, or any successor thereto, recommends that the fixed income departments of its members be closed for the entire day for purposes of trading in United States government securities.

“Whole Loans” shall mean a whole Purchased Loan.

3.INITIATION; CONFIRMATION; TERMINATION; FEES

(a) (i) Subject to the terms and conditions set forth in this Agreement, an agreement to enter into a Transaction shall be made in writing at the initiation of Seller as provided below; provided, however, that (A) the aggregate outstanding Purchase Price at any time for all

Transactions shall not exceed the Facility Amount, (B) Buyer shall not have any obligation to enter into new Transactions with Seller after the occurrence and during the continuance of a Default or an Event of Default or after the Facility Availability Period and (C) this Agreement is not a commitment to enter into Transactions but rather sets forth the procedures to be used in connection with periodic requests to enter into Transactions and Seller hereby acknowledges that Buyer is under no obligation to agree to enter into, or to enter into, any Transaction pursuant to this Agreement.

(ii) Seller may request a Transaction or an increase in Purchase Price hereunder, on any Business Day during the Facility Availability Period, by delivering to Buyer a written request for Transaction or an increase in Purchase Price, substantially in the form of Exhibit III hereto (a “Request for Transaction/Increase in Purchase Price”). Each Request for Transaction /Increase in Purchase Price shall:

(A) relate to the funding of an Eligible Loan to be transferred (or previously transferred) hereunder at the time of the transfer of the Purchase Price that is the subject of such Request for Transaction /Increase in Purchase Price (including any future advances of such Purchased Loan);

(B) in the case of the Purchase Date of an Eligible Loan, (x) be accompanied by a Complete Submission, and (y) attach a schedule identifying the Eligible Loan that Seller proposes to fund and to transfer to Buyer in connection with such Transaction substantially in the form of Annex 1 to Exhibit IV;

(C) specify the requested Funding Date and the amount requested to be funded;

(D) specify any subsequent advances which may be required,

(E) attach an officer’s certificate signed by a Responsible Officer of Seller as required by Section 9(a)(ix) hereof;

(F) indicate whether Seller desires such Purchased Loan to be a Table Funded Eligible Loan, which table funding shall be subject to Buyer’s prior approval in Buyer’s sole discretion; and

(G) contain (by attachment) such other information reasonably requested by Buyer from time to time.

Buyer may from time to time waive certain requirements of a Complete Submission in its sole and absolute discretion if, at the time of the submission thereof, certain documents called for as part of such Complete Submission are then unavailable; provided that Seller shall use its best efforts to provide such documents as soon as they become available.

(iii) Solely with respect to the Purchase Date for an Eligible Loan, following receipt of a Request for Transaction/Increase in Purchase Price and a Complete Submission, Buyer shall inform Seller in its sole discretion of its

election to proceed with a Transaction hereunder by delivering to Seller a funding confirmation, substantially in the form of Exhibit IV hereto (a “Funding Confirmation”), as follows. Within ten (10) Business Days following receipt of a Complete Submission (and any other materials reasonably requested by Buyer relating to a proposed funding in connection with Buyer conducting its own due diligence investigation of the Eligible Loan proposed to be funded by Buyer), Buyer shall conduct its diligence review and notify Seller in such Funding Confirmation as to whether it approves of such Eligible Loan (including in the case of a request for a Table Funded Eligible Loan, whether it approves of same) and its Schedule of Exceptions to Representations and Warranties. If, with respect to any Mortgage Loan, Buyer does not respond to Seller within the time frames specified in the preceding sentence, Buyer shall be deemed to have elected not to make a Loan secured by such Mortgage Loan.

(iv) Following receipt of a Funding Confirmation from Buyer pursuant to Section 3(a)(iii), Seller shall, not later than 12:00 noon New York City time on the Business Day prior to the requested Funding Date, (i) in the case of a Table Funded Eligible Loan, deliver the Title Escrow Letter with respect thereto to Custodian, with a copy to Buyer, as provided in the Custodial Agreement, and (ii) deliver the Closing Counsel Letter to Buyer. Following Buyer’s receipt of the Title Escrow Letter (if applicable) and Closing Counsel Letter, and Buyer’s final determination that the Mortgage Loan is an Eligible Loan, subject to Section 9 hereof, Buyer shall transfer the Purchase Price pursuant to the wiring instructions Seller delivers to Buyer or in the case of a Table Funded Eligible Loan, set forth in the Title Escrow Letter to partially fund the applicable Purchased Loan in an amount determined in accordance with Section 3(a)(v) below, which transfer shall constitute the entry into a Transaction hereunder in the amount of the Purchase Price. Pursuant to the Title Escrow Letter, the title insurance company party thereto shall return to Buyer the Purchase Price so advanced if Seller fails to advance its portion of such Purchased Loan on such Funding Date. A Title Escrow Letter shall not be required for Purchased Loans which have been previously made the subject of a Transaction.

(v) The amount of the Purchase Price with respect to any Purchased Loan on the Purchase Date shall be an amount up to the least of (i) 75% of such Purchased Loan’s aggregate initial principal amount (or as otherwise agreed to by Seller and Buyer on a case-by-case basis, but in any case not to exceed 80% of such Purchased Loan’s aggregate initial principal amount), (ii) 60% of the value of the related Mortgaged Property (or, with respect to any Purchased Loan secured by a Mortgaged Property which is multi-family, 64% of the value of the related Mortgaged Property) as set forth in an Appraisal delivered to Buyer, (iii) the amount that would cause

the Debt Yield calculated with respect to all of the Purchased Loans to be less than the Minimum Portfolio Debt Yield, and (iv) the amount that would cause the Debt Yield calculated with respect to such Purchased Loan individually to be less than the applicable Minimum Individual Purchased Loan Debt Yield.

(vi) With respect to any Purchased Loan where Buyer has funded the Purchase Price on the Purchase Date as provided for herein, following receipt of a Request for Transaction/Increase in Purchase Price, which shall be delivered by Seller no less than three (3) Business Days prior to the proposed Funding Date, and of all items required to be delivered to Buyer pursuant to this Agreement (including, without limitation Section (9)), Buyer shall fund a portion of any future advance which Seller shall be contractually obligated to fund under the related Purchased Loan Documents in an amount equal to the product of (x) the amount of such future advance multiplied by (y) the percentage equal to the quotient of the Purchase Price transferred by Buyer in connection with the Purchase Date divided by the aggregate initial funded amount of such Purchased Loan, subject in each case to satisfaction of the following conditions precedent:

(A) the portion of the future advance funded by Buyer shall not cause the sum of (a) the aggregate Purchase Price for all Purchased Loans, plus (b) the requested Purchase Price for any pending Transaction, plus (c) the aggregate amount of any potential future advance draws with respect to all Purchased Loans, in the aggregate, to exceed the Facility Amount;

(B) if the Confirmation of the Transaction relating to the applicable Purchased Loan specifies additional future advance conditions precedent as determined by Buyer and Seller (including, without limitation, debt yield, debt service coverage ratio and loan-to-value ratio tests), such additional conditions precedent shall be satisfied immediately upon the funding of such portion of the future advance by Buyer;

(C) Seller shall not receive a Funding Date for future advances with respect to each Purchased Loan more than one time during each calendar month or during the final twelve months of the term of any Purchased Loan;

(D) the amount of Purchase Price transferred for a future advance with respect to each Purchased Loan shall be in an amount not less than $250,000; and

(E) Seller shall have delivered to Buyer evidence reasonably satisfactory to Buyer that the underlying Mortgagor with respect to the applicable Purchased Loan shall have delivered all items

required to be delivered as conditions precedent to the making of such future advance and shall have given Buyer a period of time reasonably satisfactory to Buyer within which to review such items.

(vii) Notwithstanding anything herein to the contrary, the aggregate outstanding Purchase Price with respect to any individual Purchased Loan (inclusive of the Purchase Date and all future Funding Dates) shall not exceed the Maximum Transaction Amount.

(viii) On the Business Day that Custodian receives the complete Purchased Loan Documents, Custodian will notify Buyer of its receipt of such Purchased Loan Documents and deliver to Buyer a Trust Receipt, with a copy to Seller. Seller shall cause the Closing Counsel to deliver the Purchased Loan Documents with respect to each Purchased Loan within three (3) Business Days following the Purchase Date to the Custodian and shall deliver the Complete Submission with respect to such Purchased Loan to Buyer.

(ix) Notwithstanding any other provision hereunder, the fact that Buyer has conducted or has failed to conduct any partial or complete examination or any other due diligence review of any Purchased Loan shall in no way affect any rights Buyer may have hereunder or otherwise with respect to any representations or warranties or other rights hereunder, including without limitation, the right to determine at any time that such Purchased Loan is the subject of an Eligibility Breach.

(b) Upon agreeing to enter into a Transaction or to increase the Purchase Price hereunder, Buyer shall promptly deliver to Seller a written confirmation in the form of Exhibit VIII attached hereto of such Transaction or increase in Purchase Price (a “Confirmation”). Such Confirmation shall describe the Purchased Loan, shall identify Buyer and Seller, and shall set forth:

(i) the Purchase Date/Funding Date,

(ii) the Initial Purchase Price Percentage, the Margin Percentage and the Purchase Price for such Purchased Loan,

(iii) the Repurchase Date,

(iv) the Pricing Rate (including the Applicable Margin), and

(v) any additional terms or conditions not inconsistent with this Agreement.

With respect to any Transaction, the Pricing Rate shall be determined initially on the Pricing Rate Determination Date applicable to the first Pricing Rate Period for such Transaction, and shall be reset on each subsequent Pricing Rate Determination Date for the next succeeding Pricing Rate Period for such Transaction. Buyer or its agent shall determine in accordance with the terms of this Agreement the Pricing Rate on each Pricing Rate Determination Date for the

related Pricing Rate Period and notify Seller of such rate for such period on such subsequent Pricing Rate Determination Date.

(c) Each Confirmation, together with this Agreement, shall be conclusive evidence of the terms of the Transaction(s) covered thereby unless specific objection is made in writing no less than three (3) Business Days after the date thereof. In the event of any conflict between the terms of such Confirmation and the terms of this Agreement, the Confirmation shall prevail. It is understood and agreed that once a Confirmation has been executed by Buyer and Seller, such Confirmation shall be binding on the parties hereto (absent manifest error) and shall constitute evidence of Buyer’s approval of the applicable Purchased Loan and the terms of the applicable Transaction.

(d) No Transaction shall be terminable on demand by Buyer (other than upon the occurrence and during the continuance of an Event of Default). Seller shall be entitled to terminate a Transaction on demand, in whole only, and repurchase the Purchased Loan subject to a Transaction on any Business Day prior to the Repurchase Date (an “Early Repurchase Date”); provided, however, that:

(i) Seller notifies Buyer in writing of its intent to terminate such Transaction and repurchase such Purchased Loan no later than three (3) Business Days prior to such Early Repurchase Date,

(ii) on such Early Repurchase Date, Seller pays to Buyer an amount equal to the sum of (x) the Repurchase Price for such Transaction and (y) any other amounts payable under this Agreement with respect to such Transaction against transfer to Seller or its agent of such Purchased Loan,

(iii) if a Margin Deficit is in existence on such Early Repurchase Date and Buyer has notified Seller thereof in accordance with Section 4(a), then, simultaneously with such repurchase, Seller cures such Margin Deficit, and

(iv) no Event of Default has occurred and is continuing on the date of such early repurchase.

Such notice shall set forth the Early Repurchase Date and shall identify with particularity the Purchased Loans to be repurchased on such Early Repurchase Date.

(e) On the Repurchase Date or any Early Repurchase Date (including, without limitation, in order to cure a Margin Deficit), termination of the applicable Transaction will be effected by transfer to Seller or its designee of the applicable Purchased Loan and any Income in respect thereof received by Buyer (and not previously credited or transferred to, or applied to the obligations of, Seller pursuant to Section 5 of this Agreement) against the simultaneous transfer to an account of Buyer of the Repurchase Price and any other amounts payable under this Agreement with respect to such Transaction.

(f) Seller may reduce the outstanding Purchase Price of the Transactions, in whole or in part, on any Payment Date without premium or penalty. If Seller shall reduce the outstanding

Purchase Price on any day other than a Payment Date, Seller shall be responsible for all breakage costs pursuant to Section 3(h). Any amounts paid shall reduce the outstanding Purchase Price of the Transactions (together with Price Differential thereon) so designated by Seller until paid in full. Amounts paid may be re-advanced as increases in Purchase Price in accordance with the terms of this Agreement. If Seller intends to reduce the outstanding Purchase Price of the Transactions in whole or in part from any source, Seller shall give at least two (2) Business Days’ prior written notice thereof to Buyer, specifying the date and amount of payment. If such notice is given, the amount specified in such notice shall be due and payable on the date specified therein, together with accrued Price Differential to such date on the amount prepaid. Partial payments shall be in an aggregate principal amount of at least $100,000 or the outstanding balance of the designated Purchased Loan(s), if less.

(g)Effect of Benchmark Transition Event. Notwithstanding anything to the contrary contained herein or in any other Transaction Document:

(i) Benchmark Replacement. Notwithstanding anything to the contrary in this Agreement or in any other Transaction Document, if a Benchmark Transition Event or a SOFR Transition Event, as applicable, and its related Benchmark Replacement Date have occurred with respect to any Benchmark prior to the Reference Time for any Pricing Rate Determination Date for such Benchmark, the applicable Benchmark Replacement will replace such Benchmark for all purposes under this Agreement or under any other Transaction Document in respect of such setting and all settings on all subsequent dates (without any amendment to, or further action or consent of any other party to, this Agreement or any other Transaction Document). Notwithstanding the foregoing, Buyer and Seller may at any time agree to amend and restate any Confirmation with respect to any Transaction to replace the related Benchmark with respect to such Transaction with the applicable Benchmark Replacement.

(ii) Benchmark Replacement Conforming Changes. In connection with the implementation or administration of any Benchmark or Benchmark Replacement, in connection with any Benchmark Replacement Date or as a result of a Benchmark Unavailability Period, Buyer will have the right to make Benchmark Replacement Conforming Changes from time to time and, notwithstanding anything to the contrary herein or in any other Transaction Document, any amendments implementing such Benchmark Replacement Conforming Changes will become effective without any further action or consent of Seller or any other party to this Agreement or any other Transaction Document.

(iii) Market Disruption. During a Benchmark Unavailability Period, the component of the Pricing Rate based on the applicable Benchmark shall, during the continuance of such Benchmark Unavailability Period, be replaced with a Benchmark Replacement reasonably determined by Buyer.

(iv) Notices; Standards for Decisions and Determinations. Buyer will promptly notify Seller of (A) any Benchmark Replacement Date, (B) the effectiveness of any Benchmark Replacement Conforming Changes and (C) the effectiveness of any

changes to the calculation of the Pricing Rate described in Section 3(g)(iii). For the avoidance of doubt, any notice required to be delivered by Buyer as set forth in this Section 3(g) may be provided, at the option of Buyer (in its sole discretion), in one or more notices and may be delivered together with, or as a part of any amendment which implements any Benchmark Replacement or Benchmark Replacement Conforming Changes. Any determination, decision or election that may be made by Buyer pursuant to this Section 3(g), including any determination with respect to a tenor, rate or adjustment or of the occurrence or non-occurrence of an event, circumstance or date and any decision to take or refrain from taking any action or any selection, will be conclusive and binding absent manifest error and may be made in Buyer’s sole discretion and without consent from Seller or any other party to this Agreement or any other Transaction Document.

(v) [Intentionally Omitted].

(vi) Disclaimer. Buyer does not warrant or accept any responsibility for, and shall not have any liability with respect to (A) the administration, submission or any other matter related to SOFR, the SOFR Average or Term SOFR or with respect to any alternative or successor rate thereto, or replacement rate thereof (including, without limitation any Benchmark Replacement implemented hereunder), (B) the composition or characteristics of any such Benchmark Replacement, including whether it is similar to, or produces the same value or economic equivalence to SOFR, the SOFR Average or Term SOFR (or any other Benchmark) or have the same volume or liquidity as SOFR, the SOFR Average or Term SOFR (or any other Benchmark), (C) any actions or use of its discretion or other decisions or determinations made with respect to any matters covered by Section 3(g) or Section 3(i) including, without limitation, whether or not a Benchmark Transition Event has occurred, whether to declare a SOFR Transition Event, the removal or lack thereof of unavailable or non-representative tenors of SOFR, the SOFR Average or Term SOFR (or any other Benchmark), the implementation or lack thereof of any Benchmark Replacement Conforming Changes, the delivery or non-delivery of any notices required by Section 3(g)(iv) or otherwise in accordance herewith, and (D) the effect of any of the foregoing provisions of Section 3(g) or Section 3(i).

(h) If Seller makes a repayment of any Transactions on any day which is not a Payment Date, Seller shall be required to pay Buyer breakage fees (but specifically excluding lost profits, consequential and punitive damages) equal to the amount of Price Differential on the amount being repaid at the applicable Pricing Rate payable by Buyer on deposits from which such funds were obtained for the period from the date of such payment through the following Payment Date less the amount of interest realized by Buyer in redeploying the funds not utilized by reason of such payment for such period. Buyer shall, at the request of Seller, notify Seller of the amounts of costs to be paid by Seller if a Transaction is prepaid. This Section 3(h) shall survive termination of this Agreement .

(i) (1) Notwithstanding any other provision herein, if the adoption of or any change in any Requirement of Law or in the interpretation or application thereof after the date of this

Agreement shall make it unlawful for Buyer (A) to enter into Transactions, then any commitment of Buyer, as applicable, hereunder to enter into new Transactions shall forthwith be canceled or (B) to maintain or continue Transactions, then a Repurchase Date shall occur for all Transactions on the next Payment Date or on such earlier date as may be required by law. If any termination of a Transaction shall occur in accordance with subclause (B) of the preceding sentence, Seller shall pay to Buyer, as applicable, such amounts, if any, as may be required pursuant to Section 27(b) or Section 27(c).

(2) If any Requirement of Law or any change in the interpretation or application thereof or compliance by Buyer with any request or directive (whether or not having the force of law) from any central bank or other Governmental Authority made subsequent to the date hereof:

(A) shall subject Buyer to any Taxes with respect to this Agreement or any Transaction entered into by it (other than Excluded Taxes) or change the basis of taxation of payments to Buyer in respect thereof,

(B) shall impose, modify or hold applicable any reserve, special deposit, compulsory loan or similar requirement against assets held by, deposits or other liabilities in or for the account of, advances, loans or other extensions of credit by, or any other acquisition of funds by, any office of Buyer which is not otherwise included in the determination of the Benchmark hereunder, or

(C) shall impose on Buyer any other condition,

and the result of any of the foregoing is to increase the cost to Buyer, by an amount which Buyer deems to be material, of making or maintaining any Transactions or to reduce any amount receivable hereunder in respect thereof, then, in any such case, Seller shall, upon receipt of prior written notice of such fact and a reasonably detailed description of the circumstances, and in accordance with Section 3(k), either (i) prepay all such Transactions as may be outstanding (and Seller shall not be liable for any Benchmark breakage fees associated therewith) or (ii) pay Buyer such additional amount or amounts as will compensate Buyer for such increased cost or reduced amount receivable, provided Buyer will not treat Seller differently from similarly situated customers in requiring the payment of such amount or amounts.

(j) If Buyer shall have determined that the adoption of or any change in any Requirement of Law regarding capital adequacy or in the interpretation or application thereof or compliance by Buyer or any corporation controlling Buyer with any request or directive regarding capital adequacy (whether or not having the force of law) from any Governmental Authority made subsequent to the date hereof shall have the effect of reducing the rate of return on Buyer’s or such corporation’s capital as a consequence of its obligations hereunder by an amount deemed by Buyer to be material (taking into consideration Buyer’s or such corporation’s policies with respect to capital adequacy) (a “Rate of Return Reduction Event”), then from time to time, Seller shall in accordance with Section 3(k) pay to Buyer such additional amount or amounts as will compensate Buyer for such reduction, provided Buyer will not treat Seller differently from similarly situated customers in requiring the payment of such amount or amounts. Seller’s obligation to pay such additional amounts shall terminate if the Rate of Return

Reduction Event precipitating such obligation shall no longer have the effect of reducing the rate of return on Buyer’s or such corporation’s capital as a consequence of its obligations hereunder by an amount deemed by Buyer to be material (taking into consideration Buyer’s or such corporation’s policies with respect to capital adequacy).

(k) If Buyer becomes entitled to claim any additional amounts pursuant to Section 3(i)(2) or (j), it shall promptly notify Seller of the event by reason of which it has become so entitled. A certificate as to any additional amounts payable pursuant to Section 3(i)(2) or (j) submitted by Buyer to Seller shall be conclusive in the absence of manifest error. All payments required under Section 3(i)(2) or (j) shall be made by Seller within ten (10) Business Days after notice thereof from Buyer to Seller.

(l) Seller shall pay those certain fees required to be paid pursuant to and in accordance with the Fee Letter.

4.MARGIN MAINTENANCE

(a) If at any time following the occurrence of a Credit Event, the aggregate Market Value of the Purchased Loans shall be less than the sum of the Margin Amounts calculated individually with respect to each Purchased Loan (a “Margin Deficit”) and such Margin Deficit is greater than $500,000, then Buyer may by notice to Seller require Seller to cure such Margin Deficit by either:

(i) transferring to Buyer additional cash collateral in an amount at least equal to the sum of the amounts, calculated individually for each Purchased Loan, equal to the product of (x) the difference between the Margin Amount with respect to such Purchased Loan and the Market Value of such Purchased Loan multiplied by (y) the applicable Initial Purchase Price Percentage, which cash collateral shall be held by Buyer as additional Collateral with respect to the applicable Purchased Loan(s);

(ii) reducing the outstanding Purchase Price of the Transactions with respect to any Purchased Loan, as applicable, such that the aggregate Market Value of the Purchased Loans is at least equal to the sum of the Margin Amounts of the Purchased Loans; or

(iii) making a repayment of the Transactions, in whole, with respect to any Purchased Loan pursuant to Sections 3(f) and (h) of this Agreement which repayment results in a cure of such Margin Deficit.

Any cash transferred to Buyer pursuant to clause (ii) of this Section 4(a) of this Agreement with respect to any Purchased Loan shall be applied to reduce the outstanding Purchase Price for each Purchased Loan on a dollar-for-dollar basis for which there was a Margin Deficit.

(b) If any notice is given by Buyer under Section 4(a) of this Agreement on any Business Day and Seller transfers cash pursuant to Section 4(a)(i) or (ii), Seller shall transfer cash in the full amount required in Section 4(a)(i) or (ii) by no later than the close of business on the fifth (5th) Business Day following the Business Day on which such notice is given. The

failure of Buyer, on any one or more occasions, to exercise its rights under Section 4(a) of this Agreement shall not change or alter the terms and conditions to which this Agreement is subject or limit the right of Buyer to do so at a later date. Buyer and Seller agree that any failure or delay by Buyer to exercise its rights under Section 4(a) of this Agreement shall not limit such party’s rights under this Agreement or otherwise existing by law or in any way create additional rights for such party.

5.INCOME PAYMENTS AND PRINCIPAL PAYMENTS

(a) Subject to Section 5(l), with respect to each Purchased Loan, Seller hereby promises to repay in full on or prior to the Repurchase Date the then aggregate outstanding Repurchase Price with respect to such Purchased Loan.

(b) Seller hereby promises to pay to Buyer on each Payment Date until the date each Transaction shall be paid in full accrued unpaid Price Differential on the outstanding Purchase Price of each Transaction for the period from and including the date of such Transaction to but excluding the date such Transaction shall be paid in full, at a rate per annum equal to the Pricing Rate. Promptly after the determination of the Pricing Rate provided for herein or any change therein, Buyer shall give notice thereof to Seller.

(c) Except to the extent otherwise provided herein, all payments of Purchase Price, Price Differential and other amounts to be made by Seller under this Agreement, shall be made in Dollars, in immediately available funds, without deduction, set-off or counterclaim, to Buyer at the following account maintained by Buyer: Account No. 40784524, for the account of Buyer, Account Title: SSB, ABA No. 021000089, Ref: ARES, not later than 2:00 p.m., New York City time, on the date on which such payment shall become due (and each such payment made after such time on such due date shall be deemed to have been made on the next succeeding Business Day). Seller acknowledges that it has no rights of withdrawal from the foregoing account.

(d) Except to the extent otherwise expressly provided herein, if the due date of any payment under this Agreement would otherwise fall on a day that is not a Business Day, such date shall be extended to the next succeeding Business Day, and Price Differential shall be payable for any amount so extended for the period of such extension.

(e) Price Differential on the Transactions shall be computed on the basis of a 360-day year for the actual days elapsed (including the first day but excluding the last day) occurring in the period for which payable.

(f) The Buyer’s Account shall be established by Seller subject to the Blocked Account Agreement concurrently with or prior to the execution and delivery of this Agreement.

(g) Pursuant to the Servicing Agreement, Seller shall cause all Income in respect of each Purchased Loan to be collected by the Servicer and paid directly to the Servicing Account. Any Income in respect of any Purchased Loan paid directly to Seller, shall be deposited by Seller into the Servicing Account within two (2) Business Days of receipt. All such Income shall be held in trust for Buyer and shall constitute the property of Buyer. Seller covenants and agrees that no payments shall be made by any obligor to Servicer (except as specifically permitted by the terms of the Servicing Agreement in respect of certain fees and other amounts to which Servicer may be entitled), and if any such payment is made, Seller shall cause Servicer to deposit

such payment into the Servicing Account within two (2) Business Days of receipt and, pending such deposit, shall cause the Servicer to hold such amount in trust for Buyer. Seller shall cause Servicer to process any payments received in the Servicing Account with respect to the Purchased Loans and to remit such payments to the Buyer’s Account. So long as an Event of Default has not occurred and is not continuing, any Income received on the Purchased Loans (other than Scheduled Principal Payments, Balloon Payments, Principal Prepayments and net sale proceeds of a sale of a Purchased Loan) and transferred to Buyer’s Account as required hereunder shall be remitted from the Buyer’s Account to an account designated in writing by Seller on a daily basis. Notwithstanding the foregoing, upon the occurrence of an Event of Default or a Servicing Transfer Event, Buyer may send to each Mortgagor an Irrevocable Redirection Notice pursuant to which Seller shall cause all Income in respect of each Purchased Loan to be paid by the underlying Mortgagor directly to the Buyer’s Account. The Buyer’s Account shall be under the sole dominion and control of the Buyer and prior to an Event of Default, Seller shall have rights of withdrawal therefrom subject to the terms hereof and the Blocked Account Agreement.

(h) Subject to Section 5(j), solely with respect to any Purchased Loan as to which a Purchased Loan Event of Default has occurred and is continuing, Buyer shall apply the entire amount of Balloon Payments, Scheduled Principal Payments, Principal Prepayments and net sale proceeds from the sale of a Purchased Loan received in the Buyer’s Account during each Collection Period to repay on the related Payment Date the outstanding Purchase Price of the Transaction with respect to the related Purchased Loan until such Purchase Price of such Transaction has been reduced to zero. So long as a Default or an Event of Default has not occurred and is not continuing, any Balloon Payments, Scheduled Principal Payments, Principal Prepayments and net sale proceeds from the sale of a Purchased Loan received during each Collection Period in excess of the outstanding Purchase Price of a Transaction shall be remitted to Seller within one (1) Business Day.

(i) Subject to Section 5(j), except as otherwise provided in Section 5(h) above, Buyer shall apply the entire amount of Balloon Payments, Scheduled Principal Payments, Principal Prepayments and net sale proceeds from the sale of a Purchased Loan received during each Collection Period to repay on the related Payment Date the outstanding Purchase Price of the Transaction with respect to the related Purchased Loan until the Debt Yield (calculated for this purpose with reference to such Purchased Loan and such Purchase Price of the Transaction with respect to such Purchased Loan) is equal to the greater of (i) the original Debt Yield (calculated for this purpose with reference to such Purchased Loan and such Purchase Price of the Transaction made on the initial Funding Date with respect to such Purchased Loan) and (ii) 12.00%. Upon satisfaction of the Debt Yield requirement referred to in the preceding sentence, Buyer shall apply the remaining amount of such Balloon Payments, Scheduled Principal Payments, Principal Prepayments and net sale proceeds (such amount, the “Remaining Paydown Amount”) to repay the outstanding Purchase Price of the Transaction made with respect to the related Purchased Loan in an amount equal to (x) the Remaining Paydown Amount multiplied by (y) the percentage equal to the quotient of the initial Purchase Price on the Purchase Date with respect to such Purchased Loan divided by the aggregate initial funded amount of such Purchased Loan until such outstanding Purchase Price of the Transaction has been reduced to zero. So long as a Default or an Event of Default has not occurred and is not

continuing, the excess of such Remaining Paydown Amount after making the distribution described in the immediately preceding sentence shall be remitted to Seller within one (1) Business Day.

(j) If a Default shall have occurred and is continuing, Buyer shall hold in the Buyer’s Account the entire amount of Balloon Payments, Scheduled Principal Payments, Principal Prepayments and net sale proceeds from the sale of a Purchased Loan until the earlier of the cure of the event that caused such Default or the occurrence of an Event of Default following which time such amount shall be applied in accordance with Sections 5(h), 5(i) and 5(j). Upon the occurrence and during the continuation of an Event of Default, funds deposited in the Buyer’s Account, shall be held therein until the next Payment Date. On such Payment Date, Buyer shall withdraw any funds on deposit in the Buyer’s Account and apply such funds as follows:

(i)first, to Buyer in payment of any accrued and unpaid Price Differential on the Transactions and any fees then payable to Buyer, including the fees of any replacement Servicer retained by Buyer, as notified by Buyer to Seller;

(ii)second, to the payment of all other costs and fees payable to Buyer pursuant to this Agreement;

(iii)third, any remaining amounts shall be applied to reduce the outstanding Purchase Price of the Transactions and any other obligations owing to Buyer hereunder in such manner, order or priority as Buyer shall determine in its sole discretion, until such Purchase Price and other obligations shall have been paid in full; and

(iv)fourth, to pay the surplus, if any, to whoever may be lawfully entitled to receive such surplus.

(k) If Seller shall have made any representations and warranties set forth in Exhibit I without actual knowledge that they were materially false or misleading at the time made, and any such representations and warranties shall have been determined by Buyer in its reasonable discretion to be materially false or misleading with respect to a Purchased Loan transferred hereunder (an “Eligibility Breach”), Seller shall within five (5) Business Days after notice of such determination from Buyer prepay the outstanding Purchase Price with respect to such Purchased Loan, together with all accrued Price Differential thereon and fees and expenses accruing with respect thereto.

(l) By not later than sixty (60) days after the occurrence of a Purchased Loan Event of Default (including, without limitation, a maturity default), Seller shall prepay the outstanding Purchase Price with respect to such Purchased Loan, together with all accrued Price Differential thereon and fees and expenses accruing with respect thereto.

(m) If at any time the Debt Yield calculated with respect to all of the Purchased Loans is less than the Minimum Portfolio Debt Yield, then Seller shall within five (5) Business Days after notice of such determination from Buyer prepay the aggregate outstanding Purchase Price of the Transactions in the amount necessary to cause the Debt Yield calculated with respect to all of the Purchased Loans to be equal to or greater than the Minimum Portfolio Debt Yield.

6.SECURITY INTEREST

(a) Pursuant to the Custodial Agreement, Custodian shall hold the Purchased Loan Documents as exclusive bailee and agent for the benefit of Buyer pursuant to the terms of the Custodial Agreement and shall deliver to Buyer Trust Receipts (as defined in the Custodial Agreement) each to the effect that it has reviewed such Purchased Loan Documents in the manner and to the extent required by the Custodial Agreement and identifying any deficiencies in such Purchased Loan Documents as so reviewed.

(b) Buyer and Seller intend that all Transactions hereunder be sales to Buyer of the Purchased Loans and not loans from Buyer to Seller secured by the Purchased Loans. However, in the event any such Transaction is deemed to be a loan, Seller hereby pledges all of its right, title, and interest in, to and under and grants a first priority lien on, and security interest in, all of the following property, whether now owned or hereafter acquired, now existing or hereafter created and wherever located (collectively, the “Collateral”) to Buyer to secure the payment and performance of all other amounts or obligations owing to Buyer pursuant to this Agreement and the related documents described herein (collectively, the “Secured Obligations”):

(i) each Purchased Loan and the Servicing Rights related thereto;

(ii) all Purchased Loan Documents, including without limitation all promissory notes, and all Servicing Records, Servicing Agreements and any other collateral pledged or otherwise relating to such Purchased Loan, together with all files, documents, instruments, surveys, certificates, correspondence, appraisals, computer programs, computer storage media, accounting records and other books and records relating thereto;

(iii) all mortgage guaranties and insurance (issued by governmental agencies or otherwise) and any mortgage insurance certificate or other document evidencing such mortgage guaranties or insurance relating to all Purchased Loan and all claims and payments thereunder;

(iv) all other insurance policies and insurance proceeds relating to any Purchased Loan or the related Mortgaged Property;

(v) all Interest Rate Protection Agreements, relating to or constituting any and all of the foregoing;

(vi) the Buyer’s Account and all monies from time to time on deposit in the Buyer’s Account;

(vii) any and all “securities accounts”, as defined in the UCC, relating to any of the foregoing and each “financial asset”, as defined in the UCC, contained therein, including, without limitation, any accounts described in Section 5(f);

(viii) all collateral, however defined, under any other agreement between Seller on the one hand and Buyer or any of its Affiliates on the other hand;

(ix) all “general intangibles”, “accounts,” “instruments”, “investment property”, “deposit accounts” and “chattel paper” as defined in the UCC relating to or constituting any and all of the foregoing; and

(x) any and all replacements, substitutions, distributions on or proceeds of any and all of the foregoing.

(c) Intentionally Omitted.

(d) Buyer acknowledges and agrees that, notwithstanding anything to the contrary contained herein, (i) the rights of Seller as holder of the Collateral are subject to the terms of the Purchased Loan Documents; (ii) Buyer’s interest in the Collateral is subject to the terms of the Purchased Loan Documents; (iii) unless an Event of Default shall have occurred and be continuing, Buyer shall permit Seller to exercise any and all voting, consent or other rights with respect to the Collateral; and (iv) upon completion of any foreclosure of the Collateral, Buyer, its designee or transferee will assume all of the obligations of the holders of the applicable Purchased Loan from and after such foreclosure.

(e) At any time and from time to time, upon the written request of Buyer, and at the sole expense of Seller, Seller will promptly and duly execute and deliver, or will promptly cause to be executed and delivered, such further instruments and documents and take such further action as Buyer may reasonably request for the purpose of obtaining or preserving the full benefits of this Agreement and of the rights and powers herein granted, including, without limitation, the filing of any financing or continuation statements under the UCC in effect in any jurisdiction with respect to the Liens created hereby. Seller also hereby authorizes Buyer to file any such financing or continuation statement without the signature of Seller to the extent permitted by applicable law. Seller hereby authorizes Buyer and its counsel to file UCC financing statements in form and substance satisfactory to Buyer describing as the collateral covered thereby “all assets of the debtor, whether now owned or existing or hereafter acquired or arising and all proceeds and products thereof” or words to that effect, and any limitations on such collateral description, notwithstanding that such collateral description may be broader in scope than the Collateral described herein.

(f) Seller shall not (i) change the location of its chief executive office/chief place of business from that specified in Section 10(h) hereof, (ii) change its name, identity or corporate structure (or the equivalent) or change the location where it maintains its records with respect to the Collateral or (iii) reincorporate or reorganize under the laws of another jurisdiction unless it shall have given Buyer at least 30 days prior written notice thereof and shall have delivered to Buyer all UCC financing statements and amendments thereto as Buyer shall reasonably request and taken all other actions deemed reasonably necessary by Buyer to continue its perfected status in the Collateral with the same or better priority. Seller’s organizational identification number is 5044234. Seller shall promptly notify Buyer of any change in such organizational identification number

(g) Seller hereby irrevocably constitutes and appoints Buyer and any officer or agent thereof, with full power of substitution, as its true and lawful attorney-in-fact with full irrevocable power and authority in the place and stead of Seller and in the name of Seller or in its own name, from time to time following the occurrence and during the continuance of an Event of

Default to take any and all appropriate action and to execute any and all documents and instruments which may be necessary or desirable to accomplish the purposes of this Agreement, and, without limiting the generality of the foregoing, Seller hereby gives Buyer the power and right, on behalf of Seller, without assent by, but with notice to, Seller, if an Event of Default shall have occurred and be continuing, to do the following:

(i) in the name of Seller or its own name, or otherwise, to take possession of and endorse and collect any checks, drafts, notes, acceptances or other instruments for the payment of moneys due under any mortgage insurance or payable on or on account of any other Collateral and to file any claim or to take any other action or proceeding in any court of law or equity or otherwise deemed appropriate by Buyer for the purpose of collecting any and all such moneys due under any such mortgage insurance or with respect to any other Collateral whenever payable,

(ii) to pay or discharge taxes and Liens levied or placed on or threatened against the Collateral, and

(iii) (A) to direct any party liable for any payment under any Collateral to make payment of any and all moneys due or to become due thereunder directly to Buyer or as Buyer shall direct; (B) to ask or demand for, collect, receive payment of and receipt for, any and all moneys, claims and other amounts due or to become due at any time in respect of or arising out of any Collateral; (C) to sign and endorse any invoices, assignments, verifications, notices and other documents in connection with any of the Collateral; (D) to commence and prosecute any suits, actions or proceedings at law or in equity in any court of competent jurisdiction to collect the Collateral or any portion thereof and to enforce any other right in respect of any Collateral; (E) to defend any suit, action or proceeding brought against Seller with respect to any Collateral; (F) to settle, compromise or adjust any suit, action or proceeding described in clause (E) above and, in connection therewith, to give such discharges or releases as Buyer may deem appropriate; and (G) generally, to sell, transfer, pledge and make any agreement with respect to or otherwise deal with any of the Collateral as fully and completely as though Buyer were the absolute owner thereof for all purposes, and to do, at Buyer’s option and Seller’s expense, at any time, and from time to time, all acts and things which Buyer deems reasonably necessary to protect, preserve or realize upon the Collateral and Buyer’s Liens thereon and to effect the intent of this Agreement, all as fully and effectively as Seller might do.

Seller hereby ratifies all that said attorneys shall lawfully do or cause to be done by virtue hereof. This power of attorney is a power coupled with an interest and shall be irrevocable until the Secured Obligations shall have been irrevocably paid in full.

(h) Seller also authorizes Buyer, at any time and from time to time, to execute, in connection with any sale provided for in Section 14(b) hereof, any endorsements, assignments or other instruments of conveyance or transfer with respect to the Collateral and to file any initial

financing statements amendments thereto and continuation statements with or without the signature of any Seller as authorized by applicable law, as applicable to all or any part of the Collateral and to file any initial financing statements, amendments thereto and continuation statements with or without the signature of any Seller as authorized by applicable law, as applicable to all or any part of the Collateral.

(i) The powers conferred on Buyer are solely to protect Buyer’s interests in the Collateral and shall not impose any duty upon Buyer to exercise any such powers. Buyer shall be accountable only for amounts that it actually receives as a result of the exercise of such powers, and neither Buyer nor any of its officers, directors, or employees shall be responsible to Seller for any act or failure to act hereunder, except for its own gross negligence or willful misconduct.

(j) If Seller fails to perform or comply with any of its agreements contained in the Transaction Documents beyond any notice or grace period contained herein Buyer may itself perform or comply, or otherwise cause performance or compliance, with such agreement, the out-of-pocket expenses of Buyer incurred in connection with such performance or compliance, together with interest thereon at a rate per annum equal to the Post-Default Rate, shall be payable by Seller to Buyer upon ten (10) days notice that such amounts are due and payable, unless an Event of Default shall have occurred and is continuing, in which case such amounts shall be due and payable on demand and, in either case, shall constitute Secured Obligations.

(k) Buyer’s duty with respect to the custody, safekeeping and physical preservation of the Collateral in its possession, under Section 9-207 of the UCC or otherwise, shall be to deal with it in the same manner as Buyer deals with similar property for its own account. Subject to the immediately preceding sentence, neither Buyer nor any of its directors, officers or employees shall be liable for failure to demand, collect or realize upon all or any part of the Collateral or for any delay in doing so or shall be under any obligation to sell or otherwise dispose of any Collateral upon the request of Seller or otherwise

(l) All authorizations and agencies herein contained with respect to the Collateral are irrevocable until the Secured Obligations shall have been irrevocably paid in full and are powers coupled with an interest.

(m) Upon termination of this Agreement and repayment to Buyer of the Repurchase Price and the performance of all obligations under the Transaction Documents, Buyer shall promptly release its security interest in any remaining Collateral; provided that if any payment, or any part thereof, of any of the Secured Obligations is rescinded or must otherwise be restored or returned by Buyer upon the insolvency, bankruptcy, dissolution, liquidation or reorganization of any Seller, or upon or as a result of the appointment of a receiver, intervenor or conservator of, or a trustee or similar officer for, Seller or any substantial part of its property, or otherwise, this Agreement, all rights hereunder and the Liens created hereby shall continue to be effective, or be reinstated, as though such payments had not been made until such time as such payments have been indefeasibly made. Upon the release of the security interest in the Purchased Loans pursuant to this Section, Buyer shall promptly release to Seller the Purchased Loan Files and execute, acknowledge and deliver to Seller any and all documents, instruments and agreements necessary to release all security interests in such Purchased Loans. Upon repayment to Buyer of the Repurchase Price with respect to a Purchased Loan, Buyer shall release to Seller the

Purchased Loan Files relating to the Purchased Loans transferred in connection with such Loans and execute, acknowledge and deliver to Seller any and all documents, instruments and agreements necessary to release all Liens in the Purchased Loans securing such Loans; provided, however, that whether or not an Event of Default has occurred and is continuing hereunder, Buyer shall be required to release the Purchased Loan File relating to a Purchased Loan and execute, acknowledge and deliver all necessary release documents if (x) the related Mortgagor has paid the entire principal amount of such Purchased Loan and all other amounts due to the applicable Seller under the related Purchased Loan Documents and (y) the required prepayment of the Loans in respect of such Purchased Loan has been made hereunder in accordance with Section 5(h).

7.PAYMENT, TRANSFER AND CUSTODY

(a) On the Purchase Date for each Transaction, ownership of the Purchased Loans shall be transferred to Buyer or its designee (including the Custodian) against the simultaneous transfer of the Purchase Price to an account of Seller specified in writing by Seller relating to such Transaction.

(b) On or before each Purchase Date, Seller shall deliver or cause to be delivered to Buyer or its designee the Custodial Delivery in the form attached hereto as Exhibit VI. In connection with each sale, transfer, conveyance and assignment of a Purchased Loan, Seller shall deliver or cause to be delivered and released the Purchased Loan File pertaining to such Purchased Loan to the Custodian in accordance with the Custodial Agreement.

From time to time, Seller shall forward to the Custodian additional original documents or additional documents evidencing any assumption, modification, consolidation or extension of a Purchased Loan in accordance with the terms of the Custodial Agreement, and upon receipt of any such other documents, the Custodian shall hold such other documents in accordance with the Custodial Agreement. With respect to any documents which have been delivered or are being delivered to recording offices for recording and have not been returned to Seller in time to permit their delivery hereunder at the time required, in lieu of delivering such original documents, Seller shall deliver to Buyer a true copy thereof with an officer’s certificate certifying that such copy is a true, correct and complete copy of the original, which has been transmitted for recordation. Seller shall deliver or cause to be delivered such original documents to the Custodian promptly when they are received. Buyer shall deposit the Purchased Loan Files representing the Purchased Loans, or direct that the Purchased Loan Files be deposited directly, with the Custodian. The Purchased Loan Files shall be maintained in accordance with the Custodial Agreement. Any Purchased Loan Files not delivered to Buyer or its designee (including the Custodian) are and shall be held in trust by Seller or its designee for the benefit of Buyer as the owner thereof. Seller or its designee shall maintain a copy of the Purchased Loan File and the originals of the Purchased Loan File not delivered to Buyer or its designee. The possession of the Purchased Loan File by Seller or its designee is at the will of Buyer for the sole purpose of servicing the related Purchased Loan, and such retention and possession by Seller or its designee is in a custodial capacity only. The books and records (including, without limitation, any computer records or tapes) of Seller or its designee shall be marked appropriately to reflect clearly the sale of the related Purchased Loan to Buyer. Seller or its designee (including the

Custodian) shall release its custody of the Purchased Loan File only in accordance with the Custodial Agreement or as otherwise required by law. Upon the repurchase of any Purchased Loan pursuant to this Agreement or the payment in full of such Purchased Loan, as applicable, in either case which shall be evidenced by the Custodian’s receipt of a request for release in the form set forth in the Custodial Agreement, Buyer and Custodian shall promptly release the related Purchased Loan File to Seller or its designee.

8.SALE, TRANSFER, HYPOTHECATION OR PLEDGE OF PURCHASED LOANS

(a) Title to all Purchased Loans shall pass to Buyer on the applicable Purchase Date, and Buyer shall have free and unrestricted use of all Purchased Loans, subject however, to the terms of this Agreement. Nothing in this Agreement or any other Transaction Document shall preclude Buyer from engaging in repurchase transactions with the Purchased Loans or otherwise selling, transferring, pledging, repledging, hypothecating, or rehypothecating the Purchased Loans, but no such transaction shall relieve Buyer of its obligations to transfer the Purchased Loans to Seller pursuant to Section 3 of this Agreement or of Buyer’s obligation to credit or pay Income to, or apply Income to the obligations of, Seller pursuant to Section 5 hereof.

(b) Nothing contained in this Agreement or any other Transaction Document shall obligate Buyer to segregate any Purchased Loans delivered to Buyer by Seller. Notwithstanding anything to the contrary in this Agreement or any other Transaction Document, no Purchased Loan shall remain in the custody of Seller or an Affiliate of Seller.

9.TRANSACTION CONDITIONS PRECEDENT

(a) The obligation to consider each Request for Transaction/Increase in Purchase Price on any Business Day is subject to the satisfaction of the following further conditions precedent, both immediately prior to the entry into such Transaction or increase in Purchase Price and also after giving effect thereto and to the intended use thereof:

(i)No Default. No Default or Event of Default shall have occurred and be continuing,

(ii)Representations and Warranties. Both immediately prior to the entry into such Transaction or increase in Purchase Price and also after giving effect thereto and to the intended use thereof, the representations and warranties made by Seller in Section 10 hereof, and elsewhere in each of the Transaction Documents (other than Exhibit I hereof), shall be true, correct and complete in all material respects on and as of the date of the entry into such Transaction or increase in Purchase Price with the same force and effect as if made on and as of such date (or, if any such representation or warranty is expressly stated to have been made as of a specific date, as of such specific date) and in Exhibit I hereof, shall be true, correct and complete in all material respects on and as of the date of the entry into such Transaction or increase in Purchase Price with respect to the related Purchased Loan with the same force and effect as if made on and as of such date (or, if any such representation or warranty is expressly stated to have been made as of a specific date, as of such specific date),

(iii)Request for Transaction/Increase in Purchase Price; Complete Submission. Buyer shall have received a Request for Transaction/Increase in Purchase Price and a Complete Submission, and Seller shall have pledged to deliver a complete Purchased Loan File with respect to any Purchased Loan identified on such Request for Transaction/Increase in Purchase Price within three (3) Business Days of the related Purchase Date or Funding Date; provided, that, if Buyer’s diligence review of the Purchased Loan File requires the delivery of a mortgage file, document or instrument or the equivalent that Seller cannot deliver, or cause to be delivered, to Custodian at the time they are required to be delivered, solely because of a delay caused by the public recording office where such document or instrument has been delivered for recordation, the delivery requirements set forth in this Agreement and the Custodial Agreement shall be deemed to have been satisfied as to such non-delivered Purchased Loan File, document or instrument if a copy thereof (certified by Seller or Closing Counsel to be a true and complete copy of the original thereof submitted for recording) is delivered to the Custodian on or before the date on which such original is required to be delivered, and either the original of such non-delivered document or instrument, or a photocopy thereof, with evidence of recording thereon, is delivered to Custodian within ninety (90) days of the related Funding Date, and, provided, further, that Buyer may, but is not obligated to, consent to a later date for delivery of any part of the Purchased Loan File in its sole discretion,

(iv)Servicing Agreements. With respect to any Purchased Loan identified on the Request for Transaction/Increase in Purchase Price which is not serviced pursuant to a Servicing Agreement that has been approved by Buyer previously, Seller shall have provided to Buyer a copy of the related Servicing Agreement, certified as a true, correct and complete copy of the original, together with the Servicer Notice and Agreement, fully executed by Seller and the Servicer,

(v)Funding Confirmation; Confirmation. Buyer shall have delivered to Seller (x) a Funding Confirmation, dated the date of the requested Transaction, with a Purchased Loan Funding Confirmation Schedule and an Exceptions to Representations and Warranties Schedule attached thereto and (y) a Confirmation,

(vi)Due Diligence. Without limiting Buyer’s right to perform one or more supplemental Due Diligence Reviews pursuant to Section 28 hereof, Buyer shall have completed its due diligence review of the Purchased Loan Documents for each Purchased Loan and such other documents, records, agreements, instruments, mortgaged properties or information relating to such Purchased Loan as Buyer in its sole discretion deems appropriate to review and such review shall be satisfactory to Buyer in its sole discretion,

(vii)Title Escrow Letter, Closing Counsel Letter and Trust Receipt. Seller shall have delivered (i) the Title Escrow Letter, if applicable, to the Custodian, with a copy to Buyer, and (ii) the Closing Counsel Letter to Buyer. Buyer shall have received a Trust Receipt and an Irrevocable Direction Notice with respect to the applicable Purchased Loan,

(viii)Fees and Expenses. Buyer shall have received all fees and expenses of counsel to Buyer for which an invoice has been submitted as contemplated by Section 27 which

amount, at Buyer’s option, may be netted from the Purchase Price advanced under this Agreement,

(ix)Officer’s Certificate. Buyer shall have received a certificate of a Responsible Officer of Seller, substantially in the form of Exhibit VII, (i) stating that, to the best of such Responsible Officer’s actual knowledge, each of Seller, Servicer and Guarantor has observed or performed in all material respects all of its covenants and other agreements, and satisfied every condition, contained in this Agreement and the related documents to be observed, performed or satisfied by it and that such Responsible Officer has obtained no actual knowledge of any Default or Event of Default except as specified in such certificate, (ii) on the Purchase Date for a Purchased Loan only, certifying that each Purchased Loan File delivered by Seller represents a true and correct copy of the documents contained therein, and that the applicable Purchased Loan Schedule and Closing Data File, together with all other information contained therein prepared by Seller or its Affiliates and delivered by Seller to Buyer immediately prior to the Purchase Date, is true and correct and conforms in all material respects to the Summary Due Diligence Materials included in the Complete Submission and Preliminary Data File previously provided to Buyer, and (iii) certifying as to the truth, accuracy and completeness of the representations and warranties made by Seller in Section 10 and in Exhibit I hereof (limited in the case of Exhibit I to the applicable Purchased Loan for which the Transaction is being entered into),

(x)Maximum Transaction Amount. Each Request for Transaction/Increase in Purchase Price shall be in an amount not more than the Maximum Transaction Amount,

(xi)Interest Rate Protection Agreements. Buyer shall have received fully-executed copies of any Interest Rate Protection Agreements, if any, to the extent assignable, each certified as a true, correct and complete copy of the original,

(xii)Additional Matters. All corporate and other proceedings, and all documents, instruments and other legal matters in connection with the transactions contemplated by this Agreement and the other Transaction Documents shall be reasonably satisfactory in form and substance to Buyer, and Buyer shall have received such other documents in respect of any aspect or consequence of the transactions contemplated hereby or thereby as it shall reasonably request, and

(xiii)No Material Adverse Effect or Market Disruption Event. There shall not have occurred one or more events that, in the reasonable judgment of Buyer, constitutes a Material Adverse Effect or Market Disruption Event.

10.REPRESENTATIONS OF SELLER

Seller represents and warrants to Buyer that throughout the term of this Agreement and as long as any Transaction funded by Buyer to Seller pursuant to this Agreement is outstanding:

(a)Financial Condition.

(i) The financial statements of Guarantor furnished to Buyer are complete and correct and present fairly, in accordance with GAAP, the financial condition of Guarantor as of the date(s) thereof and the results of operations of Guarantor for the period(s) covered thereby,

(ii) Such financial statements, including the related schedules and notes thereto, have been prepared in accordance with GAAP applied consistently throughout the periods involved,

(iii) Guarantor did not have, as of the date(s) of such financial statements, any material Guarantee Obligation, known contingent liability or liability for taxes for which adequate reserves have not been established, or any long-term lease or unusual forward or long-term commitment, including, without limitation, any interest rate or foreign currency swap or exchange transaction, or other financial derivative, which is not reflected in the foregoing statements or in the notes thereto, to the extent required by GAAP,

(iv) From and after the date of the financial statements referred to in Section 10(a) there has been no development or event nor any prospective development or event which has had a Material Adverse Effect,

(b) Existence; Compliance with Law; Ownership of Seller. Seller (a) is an entity duly organized, validly existing and in good standing under the laws of its jurisdiction of organization, (b) (i) has all requisite organizational power and authority, and (ii) has all governmental licenses, authorizations, consents and approvals necessary, to own and operate its property and to carry on its business as now being or as proposed to be conducted, except in the case of clause (ii) where the lack of such license, authorization, consent or approval would not reasonably be expected to have a Material Adverse Effect, (c) is duly qualified to do business and is in good standing under the laws of each jurisdiction in which the nature of the business conducted by it makes such qualification necessary and where the failure to be so qualified would reasonably be expected to have a Material Adverse Effect, and (d) is in compliance in all material respects with all Requirements of Law and obligations under the Governing Documents. The organizational chart attached hereto as Schedule II (or identified as an update thereto after the Effective Date and delivered to Buyer) is complete and accurate as of the Effective Date and illustrates all Persons who have a direct ownership interest in Seller and Seller’s Sole Member set forth on such schedule,

(c)Authorization; Enforceable Obligations.

(i) Seller has all requisite organizational power and authority, and the legal right, to make, deliver and perform this Agreement and each other Transaction Document, and to enter into Transactions hereunder, and has taken all necessary action to authorize the entry into Transactions on the terms and conditions of this Agreement and each other Transaction Document to which it is a party, and the execution, delivery and performance of this Agreement and each other Transaction Document,

(ii) No consent or authorization of, approval by, notice to, filing with or other act by or in respect of, any Governmental Authority or any other Person is required or necessary

in connection with the Transactions hereunder or with the execution, delivery, performance, validity or enforceability of this Agreement or any other Transaction Document, except (i) for filings and recordings in respect of the Transactions pursuant to this Agreement, and (ii) as previously obtained and currently in full force and effect,

(iii) Each Transaction Document to which Seller is a party has been duly and validly executed and delivered by Seller and constitutes, a legal, valid and binding obligation of Seller, enforceable against Seller in accordance with their terms, except as enforceability may be limited by applicable bankruptcy, insolvency, reorganization, moratorium or similar laws affecting the enforcement of creditors’ rights generally and by general equitable principles (whether enforcement is sought by proceedings in equity or at law),

(d)No Legal Bar. The execution, delivery and performance of this Agreement and the Transactions hereunder and the use of the proceeds thereof will not violate any Requirement of Law, any provision of the Governing Documents or Contractual Obligation of Seller and will not result in, or require, the creation or imposition of any Lien (other than the Liens created hereunder) on any of its property or revenues pursuant to any such Requirement of Law or Contractual Obligation,

(e)No Material Litigation. There are no actions, suits, arbitrations, investigations or proceedings of or before any arbitrator or Governmental Authority pending or, to the actual knowledge of Seller, threatened against Seller or against any of its properties or revenues which would reasonably be expected to have a Material Adverse Effect,

(f)No Default. Seller is not in default under or with respect to any of its Contractual Obligations in any respect which would reasonably be expected to have a Material Adverse Effect. No Event of Default has occurred and is continuing,

(g)Collateral; Collateral Security.

(i) Seller has not assigned, pledged, or otherwise conveyed or encumbered any of the Collateral to any Person other than Buyer, and immediately prior to the pledge of such Collateral, Seller was the sole owner of its Collateral and had good and marketable title thereto, free and clear of all Liens, in each case except for Liens that have been released or are to be released simultaneously with the Liens granted in favor of Buyer hereunder;

(ii) The provisions of this Agreement are effective to create in favor of Buyer a valid security interest in all right, title and interest of Seller in, to and under the Collateral;

(iii) Upon (i) receipt by Custodian of each Mortgage Note, endorsed in blank by a duly authorized officer of Seller and (ii) the issuance by Custodian to Buyer of a Trust Receipt therefor, Buyer shall have a fully perfected first priority security interest therein, in the Purchased Loan evidenced thereby and in Seller’s interest in the related Mortgaged Property;

(iv) Upon the filing of financing statements on Form UCC-1 naming Buyer as “Secured Party” and Seller as “Debtor”, and describing the Collateral, in the office of the Secretary of State for the State of Delaware, the security interests granted hereunder in the Collateral will constitute fully perfected first priority security interests under the Uniform Commercial Code of the State of Delaware in all right, title and interest of Seller in, to and under such Collateral which can be perfected by filing under the Uniform Commercial Code of the State of Delaware.

(h) Chief Executive Office. Seller’s chief executive office is located at c/o Ares Management LLC, One North Wacker Drive, 48th Floor, Chicago, Illinois 60606, or such other location as may be notified to Buyer. On the Effective Date, Seller’s jurisdiction of organization is Delaware,

(i)Location of Books and Records. The location where Seller keeps its books and records, including all computer tapes and records relating to the Collateral is its chief executive office or in another location identified by Seller to Buyer in writing,

(j)No Burdensome Restrictions. No Requirement of Law to which Seller or its Affiliates is subject or Contractual Obligation of Seller would reasonably be expected to have a Material Adverse Effect,

(k)Taxes. Seller has filed all Federal and state income tax returns and all other material tax returns that are required to be filed by it (subject to the timely filing of any extension thereof) and has paid all taxes due pursuant to such returns or pursuant to any assessment received by it, except for any such taxes or assessments, if any, that are being appropriately contested in good faith by appropriate proceedings diligently conducted and with respect to which adequate reserves in conformity with GAAP have been provided. No tax Lien has been filed, and, to the actual knowledge of Seller, no claim is being asserted, with respect to any such tax or assessment,

(l)Margin Regulations. No part of the proceeds of any Transactions will be used for “purchasing” or “carrying” any “margin stock” within the respective meanings of each of the quoted terms under, or for any other purpose which violates or would be inconsistent with the provisions of, Regulation G, T, U or X,

(m)Investment Company Act; Other Regulations. Seller is not required to register as an “investment company”, or a company “controlled” by an “investment company”, within the meaning of the Investment Company Act of 1940, as amended. Seller is not subject to regulation under any Federal or state statute or regulation which limits its ability to incur Indebtedness, except in each case where such limitation would not be reasonably likely to have a Material Adverse Effect,

(n)Assets. At the time transferred, each Purchased Loan initially included in the Collateral was an Eligible Loan (except with respect to any condition waived in writing by Buyer; it being acknowledged that Buyer shall be deemed to have waived compliance with any of the eligibility criteria or other representations contained herein applicable to any Purchased Loan, to the extent such non-compliance with same was disclosed as of the Funding Date for such Purchased Loan),

(o)No Prohibited Persons(a) . Seller or any of its officers, directors, partners, members, Affiliates or shareholders is not an entity or person: (i) that is listed in the Annex to,

or is otherwise subject to the provisions of Executive Order 13224 issued on September 24, 2001 (“EO13224”); (ii) whose name appears on the OFAC List; (iii) who commits, threatens to commit or supports “terrorism”, as that term is defined in EO13224; or (iv) who is otherwise affiliated with any entity or person listed above (any and all parties or persons described in clauses (i) through (iv) above are herein referred to as a “Prohibited Person”),

(p)Seller Solvent; Fraudulent Conveyance. As of the date hereof and immediately after giving effect to each Transaction, Seller is Solvent. Seller is not transferring any Purchased Loan with any intent to hinder, delay or defraud any of its creditors,

(q)ERISA. Seller is not an “employee benefit plan,” as defined in Section 3(3) of ERISA, subject to Title I of ERISA, and none of the assets of Seller constitutes or will constitute “plan assets” of one or more such plans within the meaning of 29 C.F.R. Section 2510.3-101,

(r)True and Complete Disclosure. The information, reports, financial statements, exhibits and schedules prepared by Seller and furnished in writing by Seller to Buyer in connection with the negotiation, preparation or delivery of this Agreement and the other Transaction Documents or included herein or therein or delivered pursuant hereto or thereto, do not contain any untrue statement of material fact or omit to state any material fact necessary to make the statements herein or therein not misleading. To the extent such information, reports, financial statements, exhibits and schedules were prepared by third parties, to the actual knowledge of Sellers, none of the aforementioned documents contain any untrue statement of material act nor do they omit to state any material fact necessary to make the statements therein not misleading. All written information furnished by Seller to Buyer in connection with this Agreement and the other Transaction Documents and the transactions contemplated hereby and thereby are true, correct and accurate, in every material respect, or (in the case of projections) based on reasonable estimates, on the date as of which such information is stated or certified. To the actual knowledge of Seller, there is no fact that has not been disclosed herein, in the other Transaction Documents or in a report, financial statement, exhibit, schedule, disclosure letter or other writing furnished to Buyer for use in connection with the transactions contemplated hereby or thereby that would reasonably be expected to have a Material Adverse Effect.

(s)True Sales. Any Purchased Loan originated by an originator other than Seller has been conveyed to Seller pursuant to a true and legal sale.

11.INTENTIONALLY OMITTED

12.COVENANTS OF SELLER

Seller covenants and agrees with Buyer that, so long as any Transaction is outstanding and until payment in full of the Repurchase Price:

(a) Financial Statements. Seller shall cause Guarantor to deliver to Buyer:

(i) as soon as available and in any event within sixty (60) days after the end of each of the first three quarterly fiscal periods of each fiscal year of Guarantor, the balance sheet of Guarantor as at the end of such period and the related unaudited statements of income and of cash flows for Guarantor for such period and the portion of the fiscal year through the end of such period, if applicable, setting forth in each case the figures for the previous year, accompanied by a certificate of a Responsible Officer of

Guarantor, which certificate shall state that said financial statements fairly present the financial condition and results of operations of Guarantor in accordance with GAAP, consistently applied, as at the end of, and for, such period (subject to normal year-end adjustments);

(ii) as soon as available and in any event within one hundred twenty (120) days after the end of each fiscal year of Guarantor, the audited balance sheets of Guarantor as at the end of such fiscal year and the related statements of income and retained earnings and of cash flows for Guarantor for such year, if applicable, setting forth in each case the figures for the previous year, prepared in accordance with GAAP, and certified by an independent certified public accountant of recognized national standing, without qualification as to scope of audit or going concern;

(iii) on or before one hundred and twenty (120) days after the end of each fiscal year of Seller, Seller shall provide Buyer with a certificate certifying that, as of the date thereof, there does or does not exist any Default or Event of Default or, if any Default or Event of Default exists specifying the nature thereof; and

(iv) promptly and in any event within five (5) Business Days following request therefor by Buyer directed to the persons to whom notice is to be given pursuant to Section 17, from time to time such other information regarding the financial condition, operations, or business of Seller as Buyer may reasonably request (and provided same is in Seller’s possession or available to Seller).

(b)Litigation. Seller will promptly, and in any event within 10 days after service of process on any of the following, give to Buyer notice of all litigation, actions, suits, arbitrations, investigations (including, without limitation, any of the foregoing which are pending or threatened) or other legal or arbitrable proceedings affecting Seller or affecting any of Seller’s Property before any Governmental Authority that (i) questions or challenges the validity or enforceability of any of the Transaction Documents or any action to be taken in connection with the transactions contemplated hereby, (ii) makes a claim or claims in an aggregate amount greater than $100,000, or (iii) which, individually or in the aggregate, if adversely determined, could be reasonably likely to have a Material Adverse Effect.

(c)Existence, Etc.

Seller will:

(i) preserve and maintain its legal existence and all of its material rights, material privileges, material licenses and material franchises;

(ii) preserve and maintain all of its material rights, privileges, licenses and franchises necessary to operate its business and perform its obligations hereunder;

(iii) comply with the requirements of all applicable laws, rules, regulations and orders of Governmental Authorities (including, without limitation, all environmental laws, all laws with respect to unfair and deceptive lending practices and predatory lending practices) if failure to comply with such requirements would be reasonably likely (either individually or in the aggregate) to have a Material Adverse Effect;

(iv) keep adequate records and books of account, in which complete entries will be made in accordance with GAAP consistently applied;

(v) not move its chief executive office from the address referred to in Section 10(h) or change its jurisdiction of organization from the jurisdiction referred to in Section 10(h) unless it shall have provided Buyer thirty (30) days’ prior written notice of such change;

(vi) pay and discharge all taxes, assessments and governmental charges or levies imposed on it or on its income or profits or on any of its Property prior to the date on which penalties attach thereto, except for any such tax, assessment, charge or levy the payment of which is being contested in good faith and by proper proceedings and against which adequate reserves are being maintained in conformance with GAAP; and

(vii) permit representatives of Buyer, during normal business hours, on three (3) Business Days’ prior notice to examine, copy and make extracts from its books and records, to inspect any of its Properties, and to discuss its business and affairs with its officers, all to the extent reasonably requested by Buyer.

(d)Prohibition of Fundamental Changes. Seller shall not enter into any transaction of merger or consolidation or amalgamation, or liquidate, wind up or dissolve itself (or suffer any liquidation, winding up or dissolution) or sell all or substantially all of its assets.

(e)Notices. Seller shall give notice to Buyer promptly, and in any event within two (2) Business Days following receipt of notice or actual knowledge of any of the following:

(i) the occurrence of any Event of Default;

(ii) upon service of process on Seller, or any agent thereof for service of process, in respect of any legal or arbitrable proceedings affecting Seller (a) that questions or challenges the validity or enforceability of any of the Transaction Documents or (b) which, if determined adversely to Seller would give rise to a liability of Seller of $100,000 or more;

(iii) upon Seller becoming aware of any Purchased Loan Event of Default under the Purchased Loan Documents for any Purchased Loan and any event or change in circumstances which has or would reasonably be expected to have a Material Adverse Effect;

(iv) upon Seller becoming aware that the Mortgaged Property in respect of any Purchased Loan has been damaged by waste, fire, earthquake or earth movement, windstorm, flood, tornado or other casualty, or otherwise damaged, in any case so as to materially and adversely affect the value of such Purchased Loan;

(v) upon Seller’s becoming aware of any Principal Prepayment of any Purchased Loan, and in any event within two (2) Business Days after receipt thereof;

(vi) of entry of a judgment or decree resulting in a liability to Seller in an amount in excess of $100,000.

Each notice pursuant to this Section shall be accompanied by a statement setting forth details of the occurrence referred to therein and stating what action Seller has taken or proposes to take with respect thereto.

(f)Special Purpose Entity. Seller shall at all times be a Special Purpose Bankruptcy Remote Entity.

(g)Transactions with Affiliates. Seller will not enter into any transaction, including without limitation any purchase, sale, loan, lease, exchange of property, or the rendering of any service, with any Affiliate unless such transaction is (a) otherwise permitted under this Agreement, (b) in the ordinary course of Seller’s business and (c) upon fair and reasonable terms no less favorable to Seller than it would obtain in a comparable arm’s length transaction with a Person which is not an Affiliate, or make a payment that is not otherwise permitted by this Section 12(g) to any Affiliate. Notwithstanding the foregoing, Buyer hereby approves and authorizes the Management Agreement and that certain Interimthe Servicing Agreement by and among Buyer, Seller and ARES Commercial Real Estate Services LLC dated as of December 11, 2011 (the “Servicing Agreement”).

(h)Limitation on Sale or Other Disposition of Collateral. Seller will not transfer, assign, sell or otherwise dispose of any Collateral other than in connection with obtaining a release of a Purchased Loan transferred hereunder in accordance with Section 3(d) hereof.

(i)Limitation on Liens on Collateral. Seller will not, nor will it permit or allow any other Person, to create, incur or permit to exist any Lien on the Collateral, except for Liens on the Collateral created hereunder. Seller will defend the Collateral against, and will take such other action as is necessary to remove any Lien on or to the Collateral, other than Liens created under this Agreement, and Seller will defend the right, title and interest of Buyer in and to any of the Collateral against the claims and demands of all Persons whomsoever, other than Persons claiming through Buyer.

(j)Limitations on Modifications, Waivers and Extensions of Asset Documents. Seller will not, nor will it permit or allow others to, enter into or permit a Significant Purchased Loan Modification to occur, without Buyer’s prior written consent, which consent shall not be unreasonably withheld or delayed.

(k)Limitation on Distributions. After the occurrence and during the continuation of any Event of Default, Seller shall not declare any dividends upon any shares of Seller’s stock now or hereafter outstanding, except dividends payable in the Capital Stock of Seller, nor shall Seller set apart assets for, a sinking or other analogous fund for the purchase, redemption, defeasance, retirement or other acquisition of any equity or partnership interest of Seller, whether now or hereafter outstanding, or make any other distribution in respect of any of the foregoing or to any shareholder or equity owner of Seller, either directly or indirectly, whether in cash or property or in obligations of Seller. Notwithstanding the foregoing, Seller shall at all times be entitled to pay any dividends or distributions necessary to maintain the status of the Guarantor as a real estate investment trust.

(l)Servicer; Servicing File. Seller shall provide to Buyer no later than the tenth (10th) Business Day of each month a report, in a form acceptable to Buyer (such report, a “Mortgage Asset Report”), containing (i) copies of all financial statements, operating statements, rent rolls, budgets and material notices received by Seller from any Mortgagor, any property manager or other party pursuant to the terms of any of the Purchased Loan Documents for any Purchased Loan relating to such Mortgagor, any guarantor with respect to such Purchased Loan or any Mortgaged Property (and Seller hereby covenants and agrees to use reasonable efforts to cause each Mortgagor to comply in all material respects with the financial reporting requirements of their respective Purchased Loan Documents), (ii) an updated Closing Data File on a loan-by-loan basis and in the aggregate, with respect to any Purchased Loan serviced hereunder by Seller or any Servicer, and (iii) reporting on any material damage to any Mortgaged Property by waste, fire, earthquake or earth movement, windstorm, hurricane, flood, tornado or other casualty, or otherwise so as to affect adversely the collateral value of such transferred Purchased Loan. Seller shall not cause or permit the Purchased Loan to be serviced or sub-serviced by any Servicer other than a Servicer expressly approved in writing by Buyer.

(m)ERISA. Seller shall not establish any employee benefit plans or other plans pursuant to ERISA, the Code or any other Federal or State Law.

(n)Prohibited Persons. Seller covenants and agrees that neither Seller nor any of its Affiliates, officers, directors, partners or members will knowingly: (i) conduct any business, nor engage in any transaction or dealing, with any Prohibited Person, including, but not limited to, the making or receiving of any contribution of funds, goods, or services, to or for the benefit of a Prohibited Person; or (ii) engage in or conspire to engage in any transaction that evades or avoids, or has the purpose of evading or avoiding, or attempts to violate, any of the prohibitions set forth in EO13224. Seller further covenants and agrees to deliver (from time to time) to Buyer any such certification or other evidence as may be requested by Buyer in its sole and absolute discretion, confirming that: (i) neither Seller nor any of its officers, directors, partners, members or Affiliates is a Prohibited Person; and (ii) neither Seller nor its officers, directors, partners, members or Affiliates has to its knowledge engaged in any business, transaction or dealings with a Prohibited Person, including, but not limited to, the making or receiving of any contribution of funds, goods, or services, to or for the benefit of a Prohibited Person.

13.SINGLE-PURPOSE ENTITY

Seller is a Special Purpose Bankruptcy Remote Entity. A “Special Purpose Bankruptcy Remote Entity” means a corporation, limited partnership or limited liability company which at all times since its formation and at all times thereafter:

(a) was and will be organized solely for the purpose of engaging in (a) the origination, purchase, ownership, servicing, sale and securitization, directly or indirectly, of one or more Purchased Loans to be transferred hereunder and (b) any and all activities necessary, convenient or incidental to the foregoing;

(b) has not engaged and will not engage in any business unrelated to the purposes enumerated in paragraph 13(a) herein;

(c) has not had and will not have any assets other than one or more Purchased Loans, cash, cash equivalents and assets of a similar nature;

(d) has not engaged, sought or consented to and will not engage in, seek or consent to any dissolution, winding up, liquidation, consolidation, merger, asset sale (except as expressly permitted by the Transaction Documents), transfer of partnership or membership interests or the like, or material amendment of its limited partnership agreement, articles of incorporation, articles of organization, certificate of formation or operating agreement (as applicable) (except as expressly permitted by the Transaction Documents);

(e) has an Independent Director whose affirmative vote is required for any Bankruptcy Action;

(f) has not, and without the unanimous consent of all of its partners, directors or members, as applicable, will not take any Bankruptcy Action;

(g) maintains and intends to maintain adequate capital in light of its contemplated business operations, provided, however, in no event shall the foregoing require the Seller’s partners, members or shareholders, as applicable, to make any additional capital contribution to Seller;

(h) has not failed and will not fail to correct any known misunderstanding regarding the separate identity of such entity;

(i) has maintained and will maintain its accounts (other than the Servicer’s Account), books and records separate from any other Person and will file its own tax returns, except as expressly required under the Transaction Documents and except to the extent such entity is treated as a “disregarded entity” for tax purposes;

(j) has maintained and will maintain its books, records, resolutions and agreements as official records;

(k) has not commingled and will not commingle its funds or assets with those of any other Person, except as expressly required under the Transaction Documents;

(l) has held and will hold its assets in its own name;

(m) has conducted and will conduct its business in its name only, and has not and will not use any trade name, except as expressly disclosed to Buyer in writing;

(n) has maintained and will maintain its financial statements, accounting records and other entity documents separate from any other Person, provided that any Seller may be included in a consolidated financial statement of an Affiliate provided that such Seller’s separate legal existence and assets and liabilities are adequately disclosed therein;

(o) has paid and will pay its own liabilities, including the salaries of its own employees, out of its own funds and assets;

(p) has observed and will observe all partnership, corporate or limited liability company formalities, as applicable;

(q) has maintained and will maintain an arm’s-length relationship with its Affiliates, except for contractual arrangements approved by Buyer or contemplated by this Agreement (including, without limitation, the Management Agreement);

(r) has and will have no Indebtedness other than unsecured trade payables in the ordinary course of business which (1) do not exceed, at any time, $10,000 in the aggregate and (2) are paid within forty-five (45) days of the date incurred;

(s) has not and will not assume or guarantee or become obligated for any Guarantee Obligation;

(t) has not and will not acquire obligations or securities of its partners, members or shareholders, except as otherwise expressly required pursuant to the Transaction Documents;

(u) has allocated and will allocate fairly and reasonably shared expenses, if any, including shared office space (if any);

(v) if such entity shares any employees with other Persons, the salaries of and the expenses related to providing benefits to such employees have been fairly and non-arbitrarily allocated among such Persons, with the result that each such Person bears its fair share of the salary and benefit costs associated with all such common employees;

(w) except in connection with the Transactions hereunder, has not pledged and will not pledge its assets for the benefit of any other Person;

(x) has held itself out and identified itself and will hold itself out and identify itself as a separate and distinct entity under its own name and not as a division or part of any other Person;

(y) has maintained and will maintain its assets in such a manner that it will not be costly or difficult to segregate, ascertain or identify its individual assets from those of any other Person;

(z) has not made and will not make loans to any Person, except for any Purchased Loan now or hereafter transferred hereunder;

(aa) has not identified and will not identify its partners, members or shareholders, or any Affiliate of any of them, as a division or part of it;

(bb) has not entered into or been a party to, and will not enter into or be a party to, any transaction with its partners, members, shareholders or Affiliates except in the ordinary course of its business and on terms which are no less favorable to it than would be obtained in a comparable arm’s-length transaction with an unrelated third party; and

(cc) will consider the interests of its creditors in connection with all corporate, partnership or limited liability company actions, as applicable.

14.EVENTS OF DEFAULT; REMEDIES

(a) Each of the following events shall constitute an event of default (an “Event of Default”) hereunder:

(i) Seller shall default in the payment of any outstanding Purchase Price or Price Differential when due (whether upon acceleration, at mandatory prepayment, or otherwise), and in the case of a default with respect to the payment of Price Differential, such default shall remain unremedied for two (2) Business Days; or

(ii) Seller shall default in the payment of any other amount payable by it hereunder or under any other Transaction Document after notification by Buyer of such default, and such default shall have continued unremedied for five (5) Business Days; or

(iii) If (A) any representation, warranty or statement contained in this Agreement or any of the Transaction Documents or in any affidavit or other instrument executed or delivered pursuant to the Transaction Documents or with respect to the Transactions (other than breaches of the representations or warranties in Exhibit I to this Agreement made without knowledge of the Seller that they were materially false or misleading at the time made) is determined by Buyer to be false or misleading in any

material respect as of the date hereof or thereof or shall become so at any time prior to the repayment in full of the Transactions and such false or misleading statement continues unremedied for ten (10) Business Days after the earlier of receipt of notice thereof from Buyer or the discovery of such false or misleading statement by Seller, or (B) any material representation, warranty or statement contained in Exhibit I to this Agreement is determined by Buyer to be false or misleading in any material respect with respect to a Purchased Loan and such representation, warranty or statement was made by the Seller with knowledge of the Seller that it was materially false or misleading at the time made; or

(iv) Seller shall fail to comply with the requirements of Section 12(c)(i), Section 12(d), Sections 12(e)(i), (iii) or (iv), Section 12(g), Section 12(k), or Section 12(m) hereof; or Seller shall fail to observe or perform any other covenant or agreement contained in this Agreement or any other Transaction Document and such failure to observe or perform shall continue unremedied for a period of ten (10) Business Days following the earlier of notice or actual knowledge of such failure;

(v) Either of the following shall occur:

(A) the commencement of any enforcement action (including, but not limited to, the giving of a notice of acceleration) by an obligee against Seller or Guarantor with respect to any Indebtedness, Guarantee Obligation and/or Contractual Obligation, provided that the aggregate amount of the Indebtedness, Guarantee Obligations and/or Contractual Obligations in respect of which such enforcement action is commenced (either individually or in the aggregate) is in excess of $500,000 with respect to Seller, or $5,000,000 with respect to Guarantor; or

(B) (x) Seller or Guarantor shall default in making any payment required to be made under one or more agreements for borrowed money to which it is a party in an aggregate amount in excess of $500,000 with respect to Seller, or $15,000,000 with respect to Guarantor, and any such failure is not cured within the applicable cure period, if any, provided for under the related agreement, or (y) Seller or Guarantor shall default in making any payment required to be made under one of more agreements for borrowed money to which it is a party in an aggregate amount in excess of $500,000 with respect to Seller, or $5,000,000 with respect to Guarantor and such default shall remain uncured for a period of forty-five (45) days.

(vi) A default, after notice and beyond the expiration of applicable grace periods, shall have occurred and be continuing under any other Transaction Document which has not been waived by Buyer in writing; or

(vii) a final judgment or judgments for the payment of money shall be rendered against Seller in excess of $250,000 or shall be rendered against Guarantor in excess of $5,000,000 by one or more courts, administrative tribunals or other bodies having jurisdiction and the same shall not be satisfied, discharged (or provision shall not be made for such discharge) or bonded, or a stay of execution thereof shall not be procured, within 30 days from the date of entry thereof, and Seller or Guarantor shall not, within said period of 30 days, or such longer period during which execution of the same shall have been stayed or bonded, appeal therefrom and cause the execution thereof to be stayed during such appeal; or

(viii) Seller or Guarantor shall admit in writing its inability to pay its debts as such debts become due; or

(ix) Seller or Guarantor shall (i) apply for or consent to the appointment of, or the taking of possession by, a receiver, custodian, trustee, examiner or liquidator or the like of itself or of all or a substantial part of its property, (ii) make a general assignment for the benefit of its creditors, (iii) commence a voluntary case under the Bankruptcy Code, (iv) file a petition seeking to take advantage of any other law relating to bankruptcy, insolvency, reorganization, liquidation, dissolution, arrangement or winding-up, or composition or readjustment of debts, (v) fail to controvert in a timely and appropriate manner, or acquiesce in writing to, any petition filed against it in an involuntary case under the Bankruptcy Code or (vi) take any corporate or other action for the purpose of effecting any of the foregoing; or

(x) a proceeding or case shall be commenced, without the application or consent of Seller or Guarantor, in any court of competent jurisdiction, seeking (i) its reorganization, liquidation, dissolution, arrangement or winding-up, or the composition or readjustment of its debts, (ii) the appointment of, or the taking of possession by, a receiver, custodian, trustee, examiner, liquidator or the like of Seller or Guarantor or of all or any substantial part of its property, or (iii) similar relief in respect of Seller or Guarantor under any law relating to bankruptcy, insolvency, reorganization, liquidation, dissolution, arrangement or winding-up, or composition or adjustment of debts, and such proceeding or case shall continue undismissed, or an order, judgment or decree approving or ordering any of the foregoing shall be entered and continue unstayed and in effect, for a period of sixty (60) or more days; or an order for relief

against Seller or Guarantor shall be entered in an involuntary case under the Bankruptcy Code; or

(xi) the Custodial Agreement (but not if terminated in accordance with its terms), the Guaranty or any other Transaction Document shall for whatever reason be terminated or cease to be in full force and effect, or the enforceability thereof shall be contested by Seller or Guarantor; or

(xii) Seller shall grant, or suffer to exist, any Lien on any Collateral except the Liens contemplated hereby, or the Liens contemplated hereby shall cease to be first priority perfected Liens on the Collateral in favor of Buyer or shall be Liens in favor of any Person other than Buyer; or

(xiii) a Change of Control shall have occurred.

(b) If an Event of Default shall occur and be continuing, the following rights and remedies shall be available to Buyer:

(i) At the option of Buyer, exercised by written notice to Seller (which option shall be deemed to have been exercised, even if no notice is given, immediately upon the occurrence of the events described in Section 13(a)(ix) or (x)), the Repurchase Date for each Transaction hereunder shall, if it has not already occurred, be deemed immediately to occur (the date on which such option is exercised or deemed to have been exercised being referred to hereinafter as the “Accelerated Repurchase Date”).

(ii) If Buyer exercises or is deemed to have exercised the option referred to in Section 14(b)(i) of this Agreement:

(A) Seller’s obligations hereunder to repurchase all Purchased Loans shall become immediately due and payable on and as of the Accelerated Repurchase Date; and

(B) to the extent permitted by applicable law, the Repurchase Price with respect to each Transaction (determined as of the Accelerated Repurchase Date) shall be increased by the aggregate amount obtained by daily application of, on a 360 day per year basis for the actual number of days during the period from and including the Accelerated Repurchase Date to but excluding the date of payment of the Repurchase Price (as so increased), (x) the Post-Default Rate for such Transaction multiplied by (y) the outstanding Repurchase Price for such Transaction (decreased by (I) any amounts actually remitted to Buyer by the Controlled Account Bank or Seller from time to time pursuant to Sections 4 or 5 of this Agreement and applied to such Repurchase Price, and (II) any amounts applied to

the Repurchase Price pursuant to Section 14(b)(iii) of this Agreement); and

(C) the Custodian shall, upon the request of Buyer, deliver to Buyer all instruments, certificates and other documents then held by the Custodian relating to the Purchased Loans.

(iii) Buyer may exercise, in addition to all other rights and remedies granted to it in this Agreement and in any other instrument or agreement securing, evidencing or relating to the Secured Obligations, all rights and remedies of a secured party under the UCC. Without limiting the generality of the foregoing, Buyer without demand of performance or other demand, presentment, protest, advertisement or notice of any kind (except any notice required by law referred to below) to or upon Seller or any other Person (each and all of which demands, presentments, protests, advertisements and notices are hereby waived), may in such circumstances forthwith collect, receive, appropriate and realize upon the Collateral, or any part thereof, and/or may forthwith sell (on a servicing released basis, at Buyer’s option), lease, assign, give option or options to purchase, or otherwise dispose of and deliver the Collateral or any part thereof (or contract to do any of the foregoing), in one or more parcels or as an entirety at public or private sale or sales, at any exchange, broker’s board or office of Buyer or elsewhere upon such terms and conditions as it may deem advisable and at such prices as it may deem best, for cash or on credit or for future delivery without assumption of any credit risk. Buyer shall have the right upon any such public sale or sales, and, to the extent permitted by law, upon any such private sale or sales, to purchase the whole or any part of the Collateral so sold, free of any right or equity of redemption in Seller, which right or equity is hereby waived or released. Buyer shall give Seller ten (10) days advance notice of any such sale, whether public or private. Seller further agrees, at Buyer’s request, to assemble the Collateral and make it available to Buyer at places which Buyer shall reasonably select, whether at Seller’s premises or elsewhere. Buyer shall apply the net proceeds of any such collection, recovery, receipt, appropriation, realization or sale, after deducting all reasonable costs and expenses of every kind incurred therein or incidental to the care or safekeeping of any of the Collateral or in any way relating to the Collateral or the rights of Buyer hereunder, including without limitation reasonable attorneys’ fees and disbursements, to the payment in whole or in part of the Secured Obligations, in such order as Buyer may elect, and only after such application and after the payment by Buyer of any other amount required or permitted by any provision of law, including without limitation Section 9-615 of the UCC, need Buyer account for the surplus, if any, to Seller. To the extent permitted by applicable law, Seller waives all claims, damages and demands it may acquire against Buyer arising out

of the exercise by Buyer of any of its rights hereunder during the continuance of an Event of Default, other than those claims, damages and demands arising from the gross negligence or willful misconduct of Buyer. If any notice of a proposed sale or other disposition of Collateral shall be required by law, such notice shall be deemed reasonable and proper if given at least 10 days before such sale or other disposition. Seller shall remain liable for any deficiency (plus accrued interest thereon as contemplated pursuant to Section 5(b) hereof) if the proceeds of any sale or other disposition of the Collateral are insufficient to pay the Secured Obligations and the reasonable fees and disbursements of any attorneys employed by Buyer to collect such deficiency.

(iv) An Event of Default shall be deemed to be continuing unless expressly waived by Buyer in writing. Upon the occurrence and during the continuance of one or more Events of Default hereunder, Buyer’s obligation to make additional Loans to Seller shall automatically terminate without further action by any Person.

(v) [Intentionally Omitted].

(vi) In addition to the remedies provided in Section 14(b)(iii) hereof and otherwise provided in this Agreement, Buyer shall have the right to obtain physical possession of the Servicing Records and all other files of Seller relating to the Collateral and all documents relating to the Collateral which are then or may thereafter come in to the possession of Seller or any third party acting for Seller and Seller shall deliver to Buyer such assignments as Buyer shall request. Seller shall be responsible for paying any fees of any servicer resulting from the termination of a servicer due to an Event of Default. Buyer shall have the right to demand transfer of all servicing rights and obligations to a new servicer acceptable to Buyer. Buyer shall be entitled to specific performance of all agreements of Seller contained in this Agreement.

(vii) Buyer shall have the right to direct all Servicers then servicing any Purchased Loan to remit all collections thereon to Buyer, and if any payments are received by Seller, Seller shall not commingle the amounts received with other funds of Seller and shall promptly pay them over to Buyer. Buyer shall also have the right to terminate any one or all of the Servicers then servicing any Purchased Loan with or without cause.

(viii) Seller shall be liable to Buyer for (i) the amount of all reasonable legal or other expenses, including, without limitation, all costs and expenses of Buyer in connection with the enforcement of this Agreement or any other agreement evidencing a Loan, whether in action, suit or litigation or bankruptcy, insolvency or other similar proceeding affecting creditors’ rights generally, further including, without limitation, the reasonable fees

and expenses of counsel incurred in connection with or as a result of an Event of Default, (ii) damages in an amount equal to the cost (including all fees, expenses and commissions) of entering into or terminating hedge transactions in connection with or as a result of an Event of Default, and (iii) any other loss, damage, cost or expense directly arising or resulting from the occurrence of an Event of Default.

(ix) To the extent permitted by applicable law, Seller shall be liable to Buyer for interest on any amounts owing by Seller hereunder, from the date Seller becomes liable for such amounts hereunder until such amounts are (i) paid in full by Seller or (ii) satisfied in full by the exercise of Buyer’s rights hereunder. Interest on any sum payable by Seller under this Section 14(b)(ix) shall be at a rate equal to the Post Default Rate.

(x) Buyer shall have, in addition to its rights and remedies under the Transaction Documents, all of the rights and remedies provided by applicable federal, state, foreign, and local laws (including, without limitation, the rights and remedies of a secured party under the UCC of the State of New York, to the extent that the UCC is applicable, and the right to offset any mutual debt and claim), in equity, and under any other agreement between Buyer and Seller. Without limiting the generality of the foregoing, Buyer shall be entitled to set off the proceeds of the liquidation of the Purchased Loan against all of Seller’s obligations to Buyer, only if such obligations are then due, without prejudice to Buyer’s right to recover any deficiency.

(xi) Subject to the notice and grace periods set forth herein, each party to this Agreement may exercise any or all of the remedies available to such party immediately upon the occurrence of an Event of Default and at any time during the continuance thereof without prior notice to the other parties hereto. Except as expressly provided herein, all rights and remedies arising under the Transaction Documents, as amended from time to time, are cumulative and not exclusive of any other rights or remedies which each party to this Agreement may have. No modification, amendment, extension, discharge, termination or waiver of any provision of this Agreement or of any other Transaction Document, nor consent to any departure by any party to this Agreement therefrom, shall in any event be effective unless the same shall be in a writing signed by the party against whom enforcement is sought, and then such waiver or consent shall be effective only in the specific instance, and for the purpose, for which given. Except as otherwise expressly provided herein, no notice to, or demand on any party to this Agreement, shall entitle such party to any other or future notice or demand in the same, similar or other circumstances. Neither any failure nor any delay on the part of any party to this Agreement in insisting upon strict performance of any term,

condition, covenant or agreement, or exercising any right, power, remedy or privilege hereunder, or under any other Transaction Document shall operate as or constitute a waiver thereof, nor shall a single or partial exercise thereof preclude any other future exercise, or the exercise of any other right, power, remedy or privilege.

(xii) Buyer may enforce its rights and remedies hereunder without prior judicial process or hearing, and Seller hereby expressly waives any defenses Seller might otherwise have to require Buyer to enforce its rights by judicial process. Seller also waives any defense Seller might otherwise have arising from the use of non-judicial process, disposition of any or all of the Purchased Loans, or from any other election of remedies. Seller recognizes that non-judicial remedies are consistent with the usages of the trade, are responsive to commercial necessity and are the result of a bargain at arm’s length.

(xiii) Upon the occurrence of an Event of Default, Buyer shall without regard to the adequacy of the security for the Transactions, be entitled to the appointment of a receiver by any court having jurisdiction, without notice, to take possession of and protect, collect, manage, liquidate, and sell the Purchased Loans or any portion thereof, collect the payments due with respect to the Purchased Loans or any portion thereof, and do anything that Buyer is authorized hereunder to do. Seller shall pay all reasonable costs and expenses incurred by Buyer in connection with the appointment and activities of such receiver.

(xiv) The powers conferred on Buyer hereunder are solely to protect Buyer’s interests in the Collateral and shall not impose any duty upon it to exercise any such powers. Buyer shall be accountable only for amounts that it actually receives as a result of the exercise of such powers, and neither it nor any of its officers, directors, employees or agents shall be responsible to Seller for any act or failure to act hereunder, except for its or their own gross negligence or willful misconduct.

(xv) Upon the designation of any Accelerated Repurchase Date, Buyer may, without prior notice to Seller, set off any sum or obligation (whether or not arising under this Agreement, whether matured or unmatured, whether or not contingent and irrespective of the currency, place of payment or booking office of the sum or obligation) owed by Seller to Buyer or any Affiliate of Buyer against any sum or obligation (whether or not arising under this Agreement, whether matured or unmatured, whether or not contingent and irrespective of the currency, place of payment or booking office of the sum or obligation) owed by Buyer or any Affiliate of Buyer to Seller. Buyer will give written notice to the other party of any set off effected under this Section 14(b)(xv). If a sum or obligation is

unascertained, Buyer may in good faith estimate that obligation and set-off in respect of the estimate, subject to the relevant party accounting to the other when the obligation is ascertained. Nothing in this Section 14(b)(xv) shall be effective to create a charge or other security interest. This Section 14(b)(xv) shall be without prejudice and in addition to any right of set-off, combination of accounts, lien or other rights to which any party is at any time otherwise entitled (whether by operation of law, contract or otherwise).

15.SINGLE AGREEMENT

Buyer and Seller acknowledge that, and have entered hereinto and will enter into each Transaction hereunder in consideration of and in reliance upon the fact that, all Transactions hereunder constitute a single business and contractual relationship and have been made in consideration of each other. Accordingly, each of Buyer and Seller agrees (i) to perform all of its obligations in respect of each Transaction hereunder, and that a default in the performance of any such obligations shall constitute a default by it in respect of all Transactions hereunder, (ii) that each of them shall be entitled to set off claims and apply property held by them in respect of any Transaction against obligations owing to them in respect of any other Transactions hereunder and (iii) that payments, deliveries and other transfers made by either of them in respect of any Transaction shall be deemed to have been made in consideration of payments, deliveries and other transfers in respect of any other Transactions hereunder, and the obligations to make any such payments, deliveries and other transfers may be applied against each other and netted.

16.RECORDING OF COMMUNICATIONS

EACH OF BUYER AND SELLER SHALL HAVE THE RIGHT (BUT NOT THE OBLIGATION) FROM TIME TO TIME TO MAKE OR CAUSE TO BE MADE TAPE RECORDINGS OF COMMUNICATIONS BETWEEN ITS EMPLOYEES, IF ANY, AND THOSE OF THE OTHER PARTY WITH RESPECT TO TRANSACTIONS; PROVIDED, HOWEVER, THAT SUCH RIGHT TO RECORD COMMUNICATIONS SHALL BE LIMITED TO COMMUNICATIONS OF EMPLOYEES TAKING PLACE ON THE TRADING FLOOR OF THE APPLICABLE PARTY. EACH OF BUYER AND SELLER HEREBY CONSENTS TO THE ADMISSIBILITY OF SUCH TAPE RECORDINGS IN ANY COURT, ARBITRATION, OR OTHER PROCEEDINGS, IF AND TO THE EXTENT CONSISTENT WITH APPLICABLE LAW AND THE RULES OF COURT AND EVIDENCE.

17.NOTICES AND OTHER COMMUNICATIONS

Except as otherwise expressly permitted by this Agreement, all notices, requests and other communications provided for herein (including without limitation any modifications of, or waivers, requests or consents under, this Agreement) shall be given or made in writing (including without limitation by telecopy) delivered to the intended recipient at the “Address for Notices” specified below its name on the signature pages hereof); or, as to any party, at such other address as shall be designated by such party in a written notice to each other party. Except as otherwise

provided in this Agreement and except for notices given under Sections 3(f), (g), (i), (k), 4, and 5 (which shall be effective only on receipt), all such communications shall be deemed to have been duly given when transmitted by telecopy before 5:30 p.m. recipient local time on a Business Day, and otherwise on the next succeeding Business Day, or personally delivered or, in the case of a mailed notice, upon receipt, in each case given or addressed as aforesaid.

18.ENTIRE AGREEMENT; SEVERABILITY

This Agreement shall supersede any existing agreements between the parties containing general terms and conditions for repurchase transactions. Each provision and agreement herein 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.

19.ASSIGNMENTS; PARTICIPATIONS AND REGISTERED FORM

(a) Seller may assign any of its rights or obligations hereunder only with the prior written consent of Buyer in its sole discretion. Buyer may assign or transfer all or any of its rights or obligations under this Agreement and the other Transaction Documents to any Eligible Assignee; provided, that, so long as an Event of Default has not occurred and is not continuing, following any such assignment or transfer, the initial Buyer shall remain as the sole party which Seller shall be required to interact with as the agent for the Transactions (irrespective of whether such Buyer retains any ownership interest in the Transactions). Subject to Section 19(a)(i), Buyer may furnish any information concerning Seller in the possession of Buyer from time to time to assignees (including prospective assignees), without any representation or recourse except as expressly provided in this Agreement. Such assignee or transferee shall provide to Seller or any agent thereof the appropriate forms, certificates and statements described in Section 31 of this Agreement.

(i) All information regarding the terms set forth in any of the Transaction Documents or the Purchased Loans shall be kept confidential and shall not be disclosed by Buyer or Buyer’s assignee to any Person (including prospective assignees) except (a) to the Affiliates of Buyer or its assignee or the respective directors, officers, employees, agents, advisors and other representatives of either who are informed of the confidential nature of such information and instructed to keep it confidential, (b) to the extent requested by any regulatory authority or required by Requirements of Law, (c) to the extent required to be included in the financial statements of Buyer, Buyer’s assignee or an Affiliate thereof, (d) to the extent required to exercise any rights or remedies under the Transaction Documents or Mortgaged Properties, (e) to the extent required to consummate and administer a Purchased Loan, or (f) to any actual or prospective Eligible Assignee that agrees to comply with Section 19(a)(i).

(b) Buyer may, in accordance with applicable law, at any time sell to one or more other entities (“Participants”) participating interests in any Transaction, its commitment to enter

into Transactions, or any other interest of Buyer hereunder and under the other Transaction Documents. In the event of any such sale by Buyer of participating interests to a Participant, Buyer’s obligations under this Agreement to Seller shall remain unchanged, Buyer shall remain solely responsible for the performance thereof, and Seller shall continue to deal solely and directly with Buyer in connection with Buyer’s rights and obligations under this Agreement and the other Transaction Documents.

(c) Seller agrees to cooperate, at no expense to Seller, with Buyer in connection with any such assignment and/or participation, to execute and deliver such replacement notes, and to enter into such restatements of, and amendments, supplements and other modifications to, this Agreement and the other Transaction Documents in order to give effect to such assignment and/or participation.

(d) Buyer, acting solely for this purpose as an agent of Seller, shall maintain at one of its offices in the United States, a copy of each assignment and assumption delivered to it and a register for the recordation of the names and addresses of Buyers, and the amounts (and stated interest) owing to, each Buyer pursuant to the terms hereof from time to time. The entries in the register shall be conclusive absent manifest error, and Seller and Buyer shall treat each person whose name is recorded in the register pursuant to the terms hereof as a Buyer hereunder for all purposes of this Agreement. The register shall be available for inspection by Seller and any Buyer at any reasonable time and from time to time upon reasonable prior notice.

(e) If Buyer sells a participation, it shall, acting solely for this purpose as an agent of Seller, maintain a register on which it enters the name and address of each participant and the principal amounts (and stated interest) of each participant’s interest herein or obligations under the Transaction Documents, provided that no Buyer shall have any obligation to disclose all or any portion of the register (including the identity of any participant or any information relating to a participant’s interest in any obligations under any Transaction Document) to any person except to the extent that such disclosure is necessary to establish that such commitment, loan, letter of credit or other obligation is in registered form under Section 5f.103-1(c) of the United States Treasury Regulations. The entries in the register shall be conclusive absent manifest error, and Buyer and Seller shall treat each person whose name is recorded in the register as the owner of such participation for all purposes of this Agreement notwithstanding any notice to the contrary.

20.GOVERNING LAW

THIS AGREEMENT SHALL BE GOVERNED BY THE LAW OF THE STATE OF NEW YORK WITHOUT REFERENCE TO CHOICE OF LAW DOCTRINE (BUT WITH REFERENCE TO SECTION 5-1401 OF THE NEW YORK GENERAL OBLIGATIONS LAW, WHICH BY ITS TERMS APPLIES TO THIS AGREEMENT), AND SHALL CONSTITUTE A SECURITY AGREEMENT WITHIN THE MEANING OF THE UCC.

21.NO WAIVERS, ETC.

No failure on the part of Buyer to exercise and no delay in exercising, and no course of dealing with respect to, any right, power or privilege under any Transaction Document shall operate as a waiver thereof, nor shall any single or partial exercise of any right, power or privilege under any Transaction Document preclude any other or further exercise thereof or the exercise of any other right, power or privilege. The remedies provided herein are cumulative and not exclusive of any remedies provided by law.

22.USE OF EMPLOYEE PLAN ASSETS

(a) If assets of an employee benefit plan subject to any provision of the Employee Retirement Income Security Act of 1974 (“ERISA”) are intended to be used by either party hereto (the “Plan Party”) in a Transaction, the Plan Party shall so notify the other party prior to the Transaction. The Plan Party shall represent in writing to the other party that the Transaction does not constitute a prohibited transaction under ERISA or is otherwise exempt therefrom, and the other party may proceed in reliance thereon but shall not be required so to proceed.

(b) Subject to the last sentence of subparagraph (a) of this Section, any such Transaction shall proceed only if Seller furnishes or has furnished to Buyer its most recent available unaudited statement of its financial condition.

(c) By entering into a Transaction pursuant to this Section, Seller shall be deemed (i) to represent to Buyer that since the date of Seller’s latest such financial statements, there has been no material adverse change in Seller’s financial condition which Seller has not disclosed to Buyer, and (ii) to agree to provide Buyer with future audited and unaudited statements of its financial condition as they are issued, so long as it is a Seller in any outstanding Transaction involving a Plan Party.

23.INTENT

(a) The parties intend that: (i) each of this Agreement and the Guaranty with respect to each Transaction constitutes a “repurchase agreement” as that term is defined in Section 101(47) of the Bankruptcy Code (except to the extent the related Transaction has a duration that renders such term inapplicable) and a “securities contract” as that term is defined in Section 741(7) of the Bankruptcy Code and that this Agreement constitutes a “master netting agreement” as defined in Section 101(38A) of the Bankruptcy Code with respect to the Transaction so constituting a “repurchase agreement” or “securities contract”, (ii) any transfers of the Repurchase Price to or for the benefit of the Buyer under this Agreement are “margin payments” or “settlement payments,” as defined in Section 741 of the Bankruptcy Code or are transfers in connection with a “securities contract”, and (iii) the grant of a security interest set forth in Sections 6 and 29(b) hereof and the Guaranty, each of which secures the rights of Buyer hereunder also constitutes a “repurchase agreement” as contemplated by Section 101(47)(A)(v) of the Bankruptcy Code (except to the extent the related Transaction has a duration that renders such term inapplicable) and a “securities contract” as contemplated by Section 741(7)(A)(xi) of the Bankruptcy Code.

(b) The parties intend that each of Buyer and Seller is a “repo participant” as that term is defined in Section 101(46) of the Bankruptcy Code and that the Buyer is a “financial institution” or financial participant” as each term is defined in 108(22) and 101(22)(A) respectively.

(c) The parties intend that each party (for so long as each is either a “financial institution,” “financial participant,” repo participant, or “master netting participant” or other entity listed in Section 555, 559, 561, 362(b)(6), or 362(b)(7) of the Bankruptcy Code) shall be entitled to the “safe harbor” benefits and protections afforded under the Bankruptcy Code with respect to a “repurchase agreement” and a “securities contract” and a “master netting agreement,” including (x) the rights set forth in Sections 3 and 14 and in Section 555, 559, and 561 of the Bankruptcy Code to liquidate the Purchased Loans and/or accelerate or terminate this Agreement, and (y) the right to offset or net out termination payments, payment amounts or other transfer obligations and otherwise exercise contractual rights as set forth in Sections 362(b)(6), 362(b)(7), 362(b)(27), 362(o), and 546 of the Bankruptcy Code.

(d) Each party hereto hereby further agrees that it shall not challenge the characterization of (i) this Agreement as a “repurchase agreement” (except to the extent the related Transaction has a duration that renders such term inapplicable), “securities contract” and/or “master netting agreement”, or (ii) each party as a “repo participant” within the meaning of the Bankruptcy Code except insofar as, in the case of a “repurchase agreement”, the term of the Transactions, would render such definition inapplicable.

(e) It is understood that either party’s right to accelerate or terminate this Agreement or to liquidate assets delivered to it in connection with the Transactions hereunder or to exercise any other remedies based on an ipso facto default is intended to be a contractual right to accelerate, terminate or liquidate this Agreement or the Transactions as described in Sections 555 and 559 of the Bankruptcy Code. It is further understood and agreed that the parties intend that either party’s right to cause the termination, liquidation, or acceleration of, or to offset net termination values, payment amounts or other transfer obligations arising under or in connection with, this Agreement or the Transactions hereunder based on an ipso facto default is a contractual right to cause the termination, liquidation, or acceleration of, or to offset net termination values, payment amounts or other transfer obligations arising under or in connection with, this Agreement as described in Section 561 of the Bankruptcy Code.

(f) The parties agree and acknowledge that if a party hereto is an “insured depository institution,” as such term is defined in the Federal Deposit Insurance Act, as amended (“FDIA”), then each of the Transactions hereunder is a “qualified financial contract,” as that term is defined in FDIA and any rules, orders or policy statements thereunder (except insofar as the type of assets subject to the Transactions would render such definition inapplicable).

(g) It is understood that this Agreement constitutes a “netting contract” as defined in and subject to Title IV of the Federal Deposit Insurance Corporation Improvement Act of 1991 (“FDICIA”) and each payment entitlement and payment obligation under the Transactions hereunder shall constitute a “covered contractual payment entitlement” or “covered contractual

payment obligation”, respectively, as defined in and subject to FDICIA (except insofar as one or both of the parties is not a “financial institution” as that term is defined in FDICIA).

(h) In light of the intent set forth above in this Section 23, Seller agrees that, from time to time upon the written request of Buyer, Seller will cooperate in good faith with Buyer to execute and deliver any supplements, modifications, addendums or other documents as may be necessary or desirable in order to cause this Agreement and the Transactions contemplated hereby to qualify for, comply with the provisions of, or otherwise satisfy, maintain or preserve the criteria for safe harbor treatment under the Bankruptcy Code for “repurchase agreements” (except to the extent the related Transaction has a duration that renders such term inapplicable), “securities contracts” and “master netting agreements”; in each case provided that Buyer has a reasonable basis for requiring the same, including, without limitation, as a result of the adoption of or any change in any applicable law, statute or regulation or in the interpretation or application thereof (provided, that any such request shall be on terms substantially consistent with, and no less favorable in any material respect to Seller than, Buyer’s requirements for other, similarly situated parties for whom Buyer has established comparable facilities). Buyer’s failure to request, or Buyer’s or Seller’s failure to execute, such supplements, modifications, addendums or other documents does not in any way alter or otherwise change the intention of the parties hereto that this Agreement and the Transactions hereunder constitute “repurchase agreements” (except to the extent the related Transaction has a duration that renders such term inapplicable), “securities contracts” and/or a “master netting agreement” as such terms are defined in the Bankruptcy Code.

(i) Notwithstanding anything to the contrary in this Agreement, it is the intention of the parties that, for U.S. Federal, state and local income and franchise tax purposes, the Transactions constitute a loan from Buyer to Seller, and that Seller is and, so long as no Event of Default shall have occurred and be continuing, will continue to be, treated as the owner of the Purchased Loans for such purposes. Unless prohibited by applicable law, Seller and Buyer (and its assignees and participants, if any) shall treat the Transactions as described in the preceding sentence for all U.S. Federal, state and local income and franchise tax purposes (including, without limitations, on any and all filings with any U.S. Federal, state or local taxing authority).

24.DISCLOSURE RELATING TO CERTAIN FEDERAL PROTECTIONS

The parties acknowledge that they have been advised that:

(a) in the case of Transactions in which one of the parties is a broker or dealer registered with the Securities and Exchange Commission (“SEC”) under Section 15 of the Securities Exchange Act of 1934 (“1934 Act”), the Securities Investor Protection Corporation has taken the position that the provisions of the Securities Investor Protection Act of 1970 (“SIPA”) do not protect the other party with respect to any Transaction hereunder;

(b) in the case of Transactions in which one of the parties is a government securities broker or a government securities dealer registered with the SEC under Section 15C of the 1934 Act, SIPA will not provide protection to the other party with respect to any Transaction hereunder; and

(c) in the case of Transactions in which one of the parties is a financial institution, funds held by the financial institution pursuant to a Transaction hereunder are not a deposit and therefore are not insured by the Federal Deposit Insurance Corporation or the National Credit Union Share Insurance Fund, as applicable.

25.CONSENT TO JURISDICTION; WAIVER OF JURY TRIAL

(a)EACH PARTY HERETO HEREBY IRREVOCABLY AND UNCONDITIONALLY:

(i)SUBMITS FOR ITSELF AND ITS PROPERTY IN ANY LEGAL ACTION OR PROCEEDING RELATING TO THIS AGREEMENT AND THE OTHER TRANSACTION DOCUMENTS, OR FOR RECOGNITION AND ENFORCEMENT OF ANY JUDGMENT IN RESPECT THEREOF, TO THE EXCLUSIVE GENERAL JURISDICTION OF ANY UNITED STATES FEDERAL OR NEW YORK STATE COURT SITTING IN MANHATTAN, AND APPELLATE COURTS FROM ANY THEREOF.

(ii)CONSENTS THAT ANY SUCH ACTION OR PROCEEDING MAY BE BROUGHT IN SUCH COURTS AND, TO THE EXTENT PERMITTED BY LAW, WAIVES ANY OBJECTION THAT IT MAY NOW OR HEREAFTER HAVE TO THE VENUE OF ANY SUCH ACTION OR PROCEEDING IN ANY SUCH COURT OR THAT SUCH ACTION OR PROCEEDING WAS BROUGHT IN AN INCONVENIENT COURT AND AGREES NOT TO PLEAD OR CLAIM THE SAME.

(iii)AGREES THAT SERVICE OF PROCESS IN ANY SUCH ACTION OR PROCEEDING MAY BE EFFECTED BY MAILING A COPY THEREOF BY REGISTERED OR CERTIFIED MAIL (OR ANY SUBSTANTIALLY SIMILAR FORM OF MAIL), POSTAGE PREPAID, TO ITS ADDRESS SET FORTH UNDER ITS SIGNATURE BELOW OR AT SUCH OTHER ADDRESS OF WHICH BUYER SHALL HAVE BEEN NOTIFIED.

(iv)AGREES THAT NOTHING HEREIN SHALL AFFECT THE RIGHT TO EFFECT SERVICE OF PROCESS IN ANY OTHER MANNER PERMITTED BY LAW OR SHALL LIMIT THE RIGHT TO SUE IN ANY OTHER JURISDICTION.

(b)WAIVER OF JURY TRIAL. SELLER AND BUYER HEREBY IRREVOCABLY WAIVE, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING ARISING OUT OF OR RELATING TO

THIS AGREEMENT, ANY OTHER TRANSACTION DOCUMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY.

(c)EACH PARTY HEREBY WAIVES ANY RIGHT TO CLAIM OR RECOVER FROM THE OTHER PARTY OR ANY INDEMNIFIED PARTY ANY SPECIAL, EXEMPLARY, PUNITIVE, INDIRECT, INCIDENTAL OR CONSEQUENTIAL DAMAGES OF ANY KIND OR NATURE WHATSOEVER OR ANY DAMAGES OTHER THAN, OR IN ADDITION TO, ACTUAL DAMAGES, WHETHER THE LIKELIHOOD OF SUCH DAMAGES WAS KNOWN AND REGARDLESS OF THE FORM OF THE CLAIM OF ACTION.

26.NO RELIANCE

Each of Buyer and Seller hereby acknowledges, represents and warrants to the other that, in connection with the negotiation of, the entering into, and the performance under, the Transaction Documents and each Transaction thereunder:

(a) It is not relying (for purposes of making any investment decision or otherwise) upon any advice, counsel or representations (whether written or oral) of the other party to the Transaction Documents, other than the representations expressly set forth in the Transaction Documents;

(b) It has consulted with its own legal, regulatory, tax, business, investment, financial and accounting advisors to the extent that it has deemed necessary, and it has made its own investment, hedging and trading decisions (including decisions regarding the suitability of any Transaction) based upon its own judgment and upon any advice from such advisors as it has deemed necessary and not upon any view expressed by the other party;

(c) It is a sophisticated and informed Person that has a full understanding of all the terms, conditions and risks (economic and otherwise) of the Transaction Documents and each Transaction thereunder and is capable of assuming and willing to assume (financially and otherwise) those risks;

(d) It is entering into the Transaction Documents and each Transaction thereunder for the purposes of managing its borrowings or investments or hedging its underlying assets or liabilities and not for purposes of speculation; and

(e) It is not acting as a fiduciary or financial, investment or commodity trading advisor for the other party and has not given the other party (directly or indirectly through any other Person) any assurance, guaranty or representation whatsoever as to the merits (either legal, regulatory, tax, business, investment, financial accounting or otherwise) of the Transaction Documents or any Transaction thereunder.

27.INDEMNITY

(a) Seller agrees to hold Buyer, and its Affiliates and their officers, directors, employees, agents and advisors (each an “Indemnified Party”) harmless from and indemnify any Indemnified Party against all liabilities, losses, damages, judgments, costs and expenses of any kind which may be imposed on, incurred by or assessed against such Indemnified Party

(collectively, the “Costs”) relating to or arising out of this Agreement, any other Transaction Document or any transaction contemplated hereby or thereby, or any amendment, supplement or modification of, or any waiver or consent under or in respect of, this Agreement, any other Transaction Document or any transaction contemplated hereby or thereby, that, in each case, results from anything other than any Indemnified Party’s gross negligence or willful misconduct. In any suit, proceeding or action brought by Buyer in connection with any Purchased Loan for any sum owing thereunder, or to enforce any provisions of any such Purchased Loan, Seller will save, indemnify and hold Buyer harmless from and against all expense, loss or damage suffered by reason of any defense, set-off, counterclaim, recoupment or reduction or liability whatsoever of the account debtor or obligor thereunder, arising out of a breach by Seller of any obligation of Seller thereunder which occurs prior to the date upon which Buyer acquires record title to such Purchased Loan or succeeds to be the absolute owner and holder of such Purchased Loan. Without limiting the generality of the foregoing, Seller, agrees to hold any Indemnified Party harmless from and indemnify such Indemnified Party against all Costs with respect to all Purchased Loan relating to or arising out of any violation or alleged violation of any environmental law, rule or regulation that, in each case, results from anything other than such Indemnified Party’s gross negligence or willful misconduct.

(b) Seller also agrees to reimburse an Indemnified Party for all such Indemnified Party’s costs and expenses incurred in connection with the enforcement or the preservation of such Indemnified Party’s rights under this Agreement, any other Transaction Document or any transaction contemplated hereby or thereby, including without limitation the fees and disbursements of its counsel as and when billed by such Indemnified Party. This Section 27 shall not apply with respect to Taxes other than Taxes that represent losses, claims, damages, etc. arising from any non-Tax claim.

(c) Seller agrees to pay as and when billed by Buyer all of the reasonable out-of-pocket costs and expenses incurred by Buyer in connection with the development, preparation and execution of, and any amendment, supplement or modification to, this Agreement, any other Transaction Document or any other documents prepared in connection herewith or therewith. Seller agrees to pay as and when billed by Buyer all of the reasonable out-of-pocket costs and expenses incurred in connection with the consummation and administration of the transactions contemplated hereby and thereby including without limitation (i) all the fees, disbursements and expenses of counsel to Buyer and (ii) all the due diligence, inspection, testing and review costs and expenses incurred by Buyer with respect to Collateral under this Agreement, including, but not limited to, those costs and expenses incurred by Buyer pursuant to Section 27(a) and 28 hereof, provided that such fees and expenses shall not exceed (x) $5,000 for the pre-funding diligence review for each Eligible Loan submitted by Seller pursuant to a Request for Transaction/Increase in Purchase Price and (y) so long as an Event of Default has not occurred and is not continuing, $3,000 per Purchased Loan per annum for ongoing administration and surveillance of each Purchased Loan.

(d) The obligations of Seller under Sections 3(i) and 27(a) and (b) hereof shall survive the repayment of the Loans and the termination of this Agreement for a period of six (6) months. In addition, each representation and warranty made or deemed to be made by a Request for Transaction/Increase in Purchase Price, herein or pursuant hereto shall survive the making of

such representation and warranty, and Buyer shall not be deemed to have waived, by reason of making any Loan, any Default that may arise because any such representation or warranty shall have proved to be false or misleading, notwithstanding that Buyer may have had notice or knowledge or reason to believe that such representation or warranty was false or misleading at the time such Loan was made.

28.DUE DILIGENCE

Seller acknowledges that Buyer has the right to perform continuing due diligence reviews with respect to the Purchased Loans and the manner in which they were originated, for purposes of verifying compliance with the representations, warranties and specifications made hereunder, or otherwise, and Seller agrees that, unless a Default has occurred (in which case no notice is required), upon reasonable (but no less than three (3) Business Day’s) prior notice to Seller, Buyer or its authorized representatives will be permitted during normal business hours to examine, inspect, and make copies and extracts of, the Purchased Loan Files and any and all documents, records, agreements, instruments or information relating to such Purchased Loan in the possession or under the control of Seller and/or Custodian. Seller also shall make available to Buyer a knowledgeable financial or accounting officer for the purpose of answering questions respecting the Purchased Loan Files and the Purchased Loan. Seller further agrees that Seller shall reimburse Buyer for any and all out-of-pocket costs and expenses incurred by Buyer in connection with Buyer’s activities pursuant to this Section 28 as and when billed by Buyer, provided that an Event of Default has occurred and is continuing hereunder.

29.SERVICING

(a) Seller and Buyer agree that all Servicing Rights with respect to the Purchased Loans will be transferred hereunder to Buyer on the applicable Purchase Date and such Servicing Rights shall be transferred by Buyer to Seller upon Seller’s payment of the Repurchase Price for such applicable Purchased Loan. Notwithstanding the purchase and sale of the Purchased Loans and Servicing Rights hereby, Seller or, upon request by Seller, Servicer shall be granted a revocable license to exercise the Servicing Rights with respect to the Purchased Loans for the benefit of Buyer and, if Buyer shall exercise its rights to pledge or hypothecate a Purchased Loan prior to the Repurchase Date pursuant to Section 8, Buyer’s assigns (which license shall be deemed automatically revoked upon the occurrence and during the continuance of an Event of Default); provided, however, that the obligations of Seller or Servicer to service the Purchased Loans shall cease, at Seller’s option, upon the payment by Seller to Buyer of the Repurchase Price therefor. Seller covenants to maintain or cause the servicing of the Purchased Loans to be maintained in conformity with the Accepted Servicing Practices (as defined in the Servicing Agreement) (“Accepted Servicing Practices”). Seller shall obtain the written consent of Buyer prior to appointing any third party Servicer for a Purchased Loan or entering into any Servicing Agreement with a Servicer (other than the initial Servicing Agreement with ARES Commercial Real Estate Servicer LLC, a Delaware limited liability company, as initial Servicer).

(b) Seller agrees that, upon Buyer’s purchase of each Purchased Loan, Buyer is the owner of all servicing records, including but not limited to any and all servicing agreements, files, documents, records, data bases, computer tapes, copies of computer tapes, proof of

insurance coverage, insurance policies, appraisals, other closing documentation, payment history records, and any other records relating to or evidencing the servicing of Purchased Loan (the “Servicing Records”) until the Repurchase Price for such Purchased Loan has been paid to Buyer. Seller grants Buyer a security interest in all servicing fees and rights relating to the Purchased Loan and all Servicing Records to secure the obligation of Seller or its designee to service in conformity with this Section and any other obligation of Seller to Buyer. Seller covenants to safeguard such Servicing Records and to deliver them promptly to Buyer or its designee (including Custodian) at Buyer’s request.

(c) If any Purchased Loan is, at any time during the term of this Agreement, serviced by a third party servicer (including any Affiliate of Seller) (such third party servicer, the “Servicer”), Seller (i) shall provide a copy of the Servicing Agreement to Buyer, which shall be in form and substance reasonably acceptable to Buyer, and (ii) shall provide a Servicer Notice and Agreement to Servicer substantially in the form of Exhibit IX hereto (a “Servicer Notice and Agreement”) and shall cause Servicer to acknowledge and agree to the same. Any successor or assignee of a Servicer shall be reasonably approved in writing by Buyer and shall acknowledge and agree to a Servicer Notice and Agreement prior to such successor’s assumption of servicing obligations with respect to the Purchased Loan.

(d) After the Funding Date, until the transfer of any Purchased Loan is relinquished by Custodian, Seller will have no obligation or right to repossess such Purchased Loan or substitute another Purchased Loan.

(e) In the event Seller or its Affiliate is servicing the Purchased Loan, Seller shall permit Buyer from time to time to inspect Seller’s or its Affiliate’s servicing facilities, as the case may be, for the purpose of satisfying Buyer that Seller or its Affiliate, as the case may be, during normal business hours and upon reasonable prior notice, has the ability to service the Purchased Loan as provided in this Agreement.

(f) Upon the occurrence and during the continuance of an Event of Default, Buyer may, in its sole discretion, (i) sell its right to the Purchased Loans on a servicing released basis or (ii) terminate any Seller or Servicer of the Purchased Loans with or without cause, in each case without payment of any termination fee.

(g) Seller shall not employ or permit Servicer to employ sub-servicers to service the Purchased Loans without the prior written approval of Buyer (such approval not to be unreasonably withheld, conditioned or delayed); provided, that in the event the commercial primary servicer rating of any such sub-servicer is not at least “Average” by S&P (or its equivalent by another nationally recognized statistical ratings organization), then the prior written approval of Buyer shall be in its sole discretion.

30.MISCELLANEOUS

(a) All rights, remedies and powers of Buyer hereunder and in connection herewith are irrevocable and cumulative, and not alternative or exclusive, and shall be in addition to all other rights, remedies and powers of Buyer whether under law, equity or agreement. In addition to the rights and remedies granted to it in this Agreement, to the extent this Agreement is

determined to create a security interest, Buyer shall have all rights and remedies of a secured party under the UCC.

(b) [Intentionally omitted].

(c) Each provision of this Agreement shall be interpreted in such manner as to be effective and valid under applicable law, but if any provision of this Agreement shall be prohibited by or be invalid under such law, such provision shall be ineffective to the extent of such prohibition or invalidity, without invalidating the remainder of such provision or the remaining provisions of this Agreement.

(d) This Agreement contains a final and complete integration of all prior expressions by the parties with respect to the subject matter hereof and thereof and shall constitute the entire agreement among the parties with respect to such subject matter, superseding all prior oral or written understandings.

(e) The parties understand that this Agreement is a legally binding agreement that may affect such party’s rights. Each party represents to the other that it has received legal advice from counsel of its choice regarding the meaning and legal significance of this Agreement and that it is satisfied with its legal counsel and the advice received from it.

(f) Should any provision of this Agreement require judicial interpretation, it is agreed that a court interpreting or construing the same shall not apply a presumption that the terms hereof shall be more strictly construed against any Person by reason of the rule of construction that a document is to be construed more strictly against the Person who itself or through its agent prepared the same, it being agreed that all parties have participated in the preparation of this Agreement.

(g) Except as otherwise expressly provided in this Agreement, any provision of this Agreement may be modified or supplemented only by an instrument in writing signed by Seller and Buyer and any provision of this Agreement may be waived by Buyer.

(h) This Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective successors and permitted assigns.

(i) The table of contents and captions and section headings appearing herein are included solely for convenience of reference and are not intended to affect the interpretation of any provision of this Agreement.

(j) This Agreement may be executed in any number of counterparts, all of which taken together shall constitute one and the same instrument, and any of the parties hereto may execute this Agreement by signing any such counterpart.

(k) Seller hereby acknowledges that:

(i) it has been advised by counsel in the negotiation, execution and delivery of this Agreement and the other Transaction Documents,

(ii) Buyer has no fiduciary relationship to Seller, and the relationship between Seller and Buyer is solely that of debtor and creditor, and Guarantor and guaranteed party, respectively; and

(iii) no joint venture exists between Buyer and Seller.

(l) In addition to any rights and remedies of Buyer provided by this Agreement and by law, Buyer shall have the right, without prior notice to Seller, any such notice being expressly waived by Seller to the extent permitted by applicable law, upon any amount becoming due and payable by Seller hereunder (whether at the stated maturity, by acceleration or otherwise) to set-off and appropriate and apply against such amount any and all deposits (general or special, time or demand, provisional or final), in any currency, and any other credits or claims, in any currency, in each case whether direct or indirect, absolute or contingent, matured or unmatured, at any time held or owing by Buyer or any Affiliate thereof to or for the credit or the account of Seller. Buyer agrees to notify Seller at the time of any such set-off and application made by Buyer; provided that the failure to give such notice shall not affect the validity of such set-off and application

31.TAXES

(a) All payments made by Seller under this Agreement shall be made free and clear of, and without deduction or withholding for or on account of, any present or future income, stamp or other taxes, levies, imposts, duties, charges, fees, deductions or withholdings, now or hereafter imposed, levied, collected, withheld or assessed by any Governmental Authority (“Taxes”), excluding, (i) Taxes that are imposed on its overall net income (and franchise taxes imposed in lieu thereof) by the jurisdiction under the laws of which the Buyer is organized or of its applicable lending office, or any political subdivision thereof, unless such Taxes are imposed as a result of the Buyer having executed, delivered or performed its obligations or received payments under, or enforced, this Existing Loan Agreement, (ii) net income Taxes and franchise Taxes (imposed in lieu of net income Taxes) imposed on Buyer as a result of a present or former connection between Buyer and the jurisdiction of the Governmental Authority imposing such Tax or any political subdivision or taxing authority thereof or therein (other than any such connection arising solely from Buyer having executed, delivered or performed its obligations or received a payment under, or enforced, this Agreement), (iii) any Tax imposed on Buyer or other recipient of a payment hereunder that is attributable to such Buyer’s or other recipient’s failure to comply with relevant requirements set forth in clause (b), (iv) any withholding Tax that is imposed on amounts payable to or for the account of Buyer or other recipient of a payment hereunder pursuant to a law in effect on the date such person becomes a party to or under this Existing Loan Agreement, or such person changes its lending office and (v) any U.S. federal withholding Taxes imposed under FATCA (all such excluded Taxes in clauses (i) – (v) being referred to, collectively, as “Excluded Taxes”). If any such non-Excluded Taxes, levies, imposts, duties, charges, fees deductions or withholdings (“Non-Excluded Taxes”) are required to be withheld from any amounts payable to Buyer hereunder, the amounts so payable to Buyer shall be increased to the extent necessary to yield to Buyer (after payment of all Non-Excluded Taxes) interest or any such other amounts payable hereunder at the rates or in the amounts specified in this Agreement. Whenever any Non-Excluded Taxes are payable by Seller, as promptly as reasonably possible thereafter Seller shall send to Buyer, as the case may be, a certified copy of an original official receipt received by Seller showing payment thereof. If Seller fails to pay any Non-Excluded Taxes when due to the appropriate taxing authority or fail to remit to Buyer the required receipts or other required documentary evidence, Seller shall indemnify Buyer for any

incremental taxes, interest or penalties that are paid or that may become payable by Buyer as a result of any such failure. The agreements in this Section shall survive the termination of this Agreement and the payment of the Loans and all other amounts payable hereunder.

(b) If a Person acquires the rights and obligations of a Buyer under this Agreement and the other Transaction Documents pursuant to Section 19(a) hereof or becomes a Participant as permitted hereunder, and such Person is not a United States Person within the meaning of Code Section 7701(a)(30) (a “Non-U.S. Person”), such Non-U.S. Person shall deliver to Seller, or any agent thereof, on or before the date on which such Person becomes a party to this Agreement or becomes such a Participant, two duly completed and executed copies of, as applicable, IRS Form W-8BEN, IRS Form W-8BEN-E or IRS Form W-8ECI or any successor forms thereto designated as such by the IRS. Notwithstanding anything to the contrary in the preceding sentence, the completion, execution and submission of such documentation shall not be required if in Buyer’s reasonable judgment such action would subject such Buyer to any material unreimbursed cost or would materially prejudice the legal or commercial position of such Buyer. If the Non-U.S. Person is eligible for and wishes to claim exemption from or reduction in U.S. federal withholding Tax through benefit of a treaty, such Person shall deliver a Form W-8ECI. If the Non-U.S. Person is eligible for and wishes to claim exemption from U.S. federal withholding Tax under Section 871(h) or Section 881(c) of the Code with respect to payments of “portfolio interest,” such Person shall deliver both the Form W-8BEN or IRS Form W-8BEN-E and a statement certifying that such Person is not a bank, a “10 percent shareholder” or a “controlled foreign corporation” within the meaning of Section 881(c)(3) of the Code. If any previously delivered form or statement becomes inaccurate with respect to the Non-U.S. Person that delivered it, the Non-U.S. Person shall promptly notify Seller of this fact. In addition, a Non-U.S. Person shall, to the extent it is legally entitled to do so, deliver to Seller executed originals of any other IRS Form prescribed by applicable law as a basis for claiming a reduction in U.S. federal withholding Tax, duly completed, together with such supplementary documentation as may be prescribed by applicable law to permit Seller to determine the withholding or deduction required to be made. If a payment made to a Non-U.S. Person would be subject to U.S. federal withholding Tax imposed by FATCA if such Buyer were to fail to comply with the applicable reporting requirements of FATCA, such Buyer shall deliver to Seller at the time or times prescribed by law and at such time or times reasonably requested by Seller such documentation prescribed by applicable law and such additional documentation reasonably requested by Seller as may be necessary for Seller to comply with its obligations under FATCA and to determine that such Buyer has complied with such Buyer’s obligations under FATCA or to determine the amount to deduct and withhold from such payment.

(c) Each Buyer (or assignee) that is not a Non-U.S. Person shall provide Seller, on or prior to the date on which such person becomes a Buyer (or acquires an interest in this Agreement), and from time to time thereafter upon the reasonable request of Seller, a duly completed and executed IRS Form W-9 certifying that it is not subject to backup withholding.

(d) If Buyer determines that it has received a refund of any Taxes as to which it has been indemnified pursuant to this Section 31 (including by payment of any additional amounts pursuant to Section 31), it shall pay to Seller an amount equal to such refund (but only to the

extent of indemnity payments made under this Section with respect to the Taxes giving rise to such refund), net of out-of-pocket expenses (including Taxes) of such Buyer.

32.JOINT AND SEVERAL OBLIGATIONS

Each Seller hereby acknowledges and agrees that (i) each Seller shall be jointly and severally liable to Buyer to the maximum extent permitted by Requirements of Law for all Secured Obligations, (ii) the liability of each Seller with respect to the Secured Obligations (A) shall be absolute and unconditional to the extent set forth in this Agreement and the other Transaction Documents and shall remain in full force and effect (or be reinstated) until all Secured Obligations shall have been paid, performed and/or satisfied, as applicable, in full, and (B) until such payment, performance and/or satisfaction, as applicable, has occurred, shall not be discharged, affected, modified or impaired on the occurrence from time to time of any event, including any of the following, whether or not with notice to or the consent of each Seller, (1) the waiver, compromise, settlement, release, termination or amendment (including any extension or postponement of the time for payment, performance, satisfaction, renewal or refinancing) of any of the Secured Obligations (other than a waiver, compromise, settlement, release or termination in full of the Secured Obligations), (2) the failure to give notice to each Seller of the occurrence of an Event of Default, (3) the release, substitution or exchange by Buyer of any Purchased Loan (whether with or without consideration) or the acceptance by Buyer of any additional collateral or the availability or claimed availability of any other collateral or source of repayment or any non-perfection or other impairment of collateral, (4) the release of any Person primarily or secondarily liable for all or any part of the Secured Obligations, whether by Buyer or in connection with any Bankruptcy Action affecting any Seller or any other Person who, or any of whose property, shall at the time in question be obligated in respect of the Secured Obligations or any part thereof, or (5) to the extent permitted by Requirements of Law, any other event, occurrence, action or circumstance that would, in the absence of this Section 32, result in the release or discharge of any or all Sellers from the performance or observance of any Secured Obligation, (iii) Buyer shall not be required first to initiate any suit or to exhaust its remedies against any Seller or any other Person to become liable, or against any of the Purchased Loans, in order to enforce the Transaction Documents and each Seller expressly agrees that, notwithstanding the occurrence of any of the foregoing, each Seller shall be and remain directly and primarily liable for all sums due under any of the Transaction Documents, (iv) when making any demand hereunder against any Seller, Buyer may, but shall be under no obligation to, make a similar demand on any other Seller, and any failure by Buyer to make any such demand or to collect any payments from any other Seller, or any release of any such other Seller shall not relieve any Seller in a respect of which a demand or collection is not made or Sellers not so released of their obligations or liabilities hereunder, and shall not impair or affect the rights and remedies, express or implied, or as a matter of law, of Buyer against Sellers, and (v) on disposition by Buyer of any property encumbered by any Purchased Loans, each Seller shall be and shall remain jointly and severally liable for any deficiency to the extent set forth in this Agreement and the other Transaction Documents.

[NO FURTHER TEXT ON THIS PAGE]

IN WITNESS WHEREOF, the parties have executed this Agreement as of the day first written above.

BUYER:

CITIBANK, N.A.

By: _____________________________  
Name:  
Title:

[Signatures Continue on Following Page]

SELLER:

ACRC LENDER C LLC,   a Delaware limited liability company      By:    Name:     Title:      ACRC LENDER C TRS LLC,   a Delaware limited liability company      By:    Name:     Title:

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## EX-31.1

SEC source: [acreq2-26exhibit311.htm](https://www.sec.gov/Archives/edgar/data/1529377/000162828026052072/acreq2-26exhibit311.htm)

Exhibit 31.1

Certification of Chief Executive Officer

of Periodic Report Pursuant to Rule 13a-14(a) and Rule 15d-14(a)

I, Bryan P. Donohoe, certify that:

1. I have reviewed this Quarterly Report on Form 10-Q of Ares Commercial Real Estate Corporation;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: August 4, 2026

/s/ Bryan P. Donohoe

Bryan P. Donohoe   Chief Executive Officer and Director

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## EX-31.2

SEC source: [acreq2-26exhibit312.htm](https://www.sec.gov/Archives/edgar/data/1529377/000162828026052072/acreq2-26exhibit312.htm)

Exhibit 31.2

Certification of Chief Financial Officer

of Periodic Report Pursuant to Rule 13a-14(a) and Rule 15d-14(a)

I, Jeffrey M. Gonzales, certify that:

1. I have reviewed this Quarterly Report on Form 10-Q of Ares Commercial Real Estate Corporation;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: August 4, 2026

/s/ Jeffrey M. Gonzales

Jeffrey M. Gonzales   Chief Financial Officer and Treasurer

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## EX-32.1

SEC source: [acreq2-26exhibit321.htm](https://www.sec.gov/Archives/edgar/data/1529377/000162828026052072/acreq2-26exhibit321.htm)

Exhibit 32.1

Certification of Chief Executive Officer and Chief Financial Officer

Pursuant to

18 U.S.C. Section 1350

In connection with the Quarterly Report on Form 10-Q of Ares Commercial Real Estate Corporation (the “Company”) for the quarter ended June 30, 2026 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), Bryan P. Donohoe, as Chief Executive Officer of the Company, and Jeffrey M. Gonzales, as Chief Financial Officer of the Company, each hereby certifies, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that, to the best of his knowledge:

1. The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

2. The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Date: August 4, 2026

/s/ Bryan P. Donohoe

Bryan P. Donohoe   Chief Executive Officer and Director

/s/ Jeffrey M. Gonzales

Jeffrey M. Gonzales   Chief Financial Officer and Treasurer

A signed original of this written statement required by Section 906, or other document authenticating, acknowledging, or otherwise adopting the signature that appears in typed form within the electronic version of this written statement required by Section 906, has been provided to the Company and will be retained by the Company and furnished to the Securities and Exchange Commission or its staff upon request.