Rocket Mortgage for diversified real estate and small business loans, structured as a REIT.

• Small to Medium Balance Commercial (SBC) Loans: Ready Capital originates loans secured by stabilized or transitional investor properties.
• Small Business Administration (SBA) Loans: The company acquires, originates, and services owner-occupied loans guaranteed by the SBA under its Section 7(a) Program.
• Residential Mortgage Loans: Ready Capital originates mortgage loans for residential properties.

Ready Capital (RC) operates as a real estate finance company, providing various types of loans. Therefore, its major customers are the borrowers of these loans, which fall into the following categories:

• Small to Medium Balance Commercial (SBC) Loan Borrowers: These customers are typically businesses or individual investors seeking financing for commercial properties, which can be stabilized or transitional investor properties.
• Small Business Administration (SBA) Loan Borrowers: These customers are small businesses that require financing, often for owner-occupied properties, utilizing loans guaranteed by the SBA under its Section 7(a) Program.
• Residential Mortgage Loan Borrowers: These customers are individuals seeking financing to purchase or refinance residential properties.

Thomas Capasse, Chief Executive Officer & Chief Investment Officer

Mr. Capasse is a co-founder of Ready Capital and its external manager, Waterfall Asset Management, LLC. He also co-founded ReadyCap Commercial LLC. Prior to founding Waterfall, Mr. Capasse managed the principal finance groups at Greenwich Capital (1995-1997), Nomura Securities (1997-2001), and Macquarie Securities (2001-2004). He was a founding member of Merrill Lynch's ABS Group (1983-1994), focusing on mortgage-backed securities (MBS) transactions. Waterfall Asset Management focuses on structured credit and private equity investments.

Andrew Ahlborn, CPA, Chief Financial Officer

Mr. Ahlborn serves as the Chief Financial Officer of Ready Capital. He joined Ready Capital's manager, Waterfall Asset Management, LLC, in 2010 and previously served as the Controller of Ready Capital since 2015. Before joining Waterfall Asset Management, he worked in Ernst & Young, LLP's Financial Services Office from 2007. Mr. Ahlborn is a licensed Certified Public Accountant in New York.

Jack Ross, President and Director

Mr. Ross is a co-founder of Ready Capital and a co-founder of its external manager, Waterfall Asset Management, LLC. Along with Thomas Capasse, he was instrumental in the acquisition and realization of significant returns on approximately $5 billion of non-performing small balance commercial real estate loans at Waterfall following the global financial crisis.

Dominick D. Scali, Chief Credit Officer, Co-President of ReadyCap Commercial, LLC

Mr. Scali was appointed Chief Credit Officer and Co-President of ReadyCap Commercial, LLC in February 2026. He has been a Managing Director and Co-Head of Bridge Lending with Ready Capital since 2015. His prior experience includes serving as head of credit and underwriting for Doral Bank's national bridge lending platform, and holding positions in credit and originations at Anglo Irish Bank and Citigroup.

Gary Taylor, CEO, ReadyCap Lending, LLC

Mr. Taylor is the Chief Executive Officer of ReadyCap Lending, LLC, a subsidiary of Ready Capital that operates as a lender under the U.S. Small Business Administration 7(a) program. He previously served as the Chief Operating Officer of Ready Capital.

The key risks to Ready Capital (RC) primarily revolve around its significant debt maturities, the inherent credit risk in its loan portfolio exacerbated by commercial real estate market fluctuations, and ongoing profitability challenges.

1. Debt Maturities and Refinancing Risk: Ready Capital faces substantial debt maturities in 2026, estimated between $550 million and $650 million. The company's ability to refinance this debt, potentially at significantly higher interest rates, poses a material risk to its future earnings and cash flow. Concerns about a potential liquidity crunch have led the company to undertake strategic equity reduction and asset sales, which have also resulted in realized losses. Ready Capital's high leverage, as indicated by its balance sheet rank, further exacerbates this risk.
2. Credit Risk and Commercial Real Estate Market Fluctuations: As a real estate finance company, Ready Capital is highly exposed to credit risk, particularly from its small to medium balance commercial (SBC) loans, small business administration (SBA) loans, and residential mortgage loans. Fluctuations in the commercial real estate market are a significant sector-specific risk that could negatively impact loan performance and the value of its collateralized assets. The company reported a 5.9% delinquency rate in its total loan portfolio in Q3 2025, indicating existing credit quality challenges and a potential for future losses and write-downs.
3. Ongoing Profitability Challenges and Financial Strain: Ready Capital has reported significant profitability challenges, including net losses and declining revenue growth. Its net interest income has experienced a sharp decline, partly due to a mismatch between changes in interest income and expenses, as well as provisions for credit losses. The company's distributable losses and a series of dividend cuts signal severe cash flow stress and a challenging financial landscape. Indicators such as a high debt-to-equity ratio and a Z-Score of 0 suggest potential financial distress.

• Residential Mortgage Loans: The U.S. home loan market size is projected to reach USD 2.42 trillion in 2026 and grow to USD 3.17 trillion by 2031. Total single-family mortgage origination volume in the U.S. is expected to increase to $2.2 trillion in 2026 from $2.0 trillion in 2025. The residential mortgage loan market globally was estimated at USD 12,500.75 billion in 2024 and is projected to reach USD 21,500.40 billion by 2032, with the United States accounting for 23.4% of this market.
• Small Business Administration (SBA) Loans: The U.S. small business loan market, which includes government-backed programs such as the SBA, was valued at $245.39 billion in 2023 and is projected to reach $349.64 billion by 2033. Specifically, in fiscal year 2024, the U.S. Small Business Administration provided $37.8 billion in 7(a) and 504 funding, with $31.1 billion attributed to 7(a) loans. SBA lending is anticipated to increase by 10-12% in 2025, reaching $55-56 billion.
• Small to Medium Balance Commercial (SBC) Loans: The broader commercial lending market in North America is projected to reach a valuation of USD 2,892.50 billion by 2025. The small business loan market in the United States, encompassing a range of commercial lending to smaller enterprises, is valued at over $1.4 trillion. The commercial and multifamily mortgage lending in the U.S. is forecast to rise to $583 billion in 2025 and $709 billion in 2026.

• Increased Capital Allocation to Small Business Lending (SBL): The company plans to significantly increase its capital allocation to the Small Business Lending segment, particularly within its high-return Small Business Administration (SBA) Section 7(a) program. Ready Capital aims to double its SBA 7(a) loan volume to $1 billion, which is a key focus for future earnings growth. This expansion in originations directly contributes to revenue growth through increased loan portfolios and associated income.
• Redeployment of Capital from Underperforming Commercial Real Estate (CRE) Assets: Ready Capital is actively engaged in a strategic balance sheet repositioning, which involves selling underperforming commercial real estate assets. The goal is to eliminate negative earnings drag and generate free cash flow, with a target of over $850 million by year-end through asset sales and runoff. This freed-up capital will be strategically redeployed into higher-yielding assets and new originations at market yields, thereby enhancing net interest income and overall revenue.
• Re-entry into the Origination Market with a Focus on High-Quality Multifamily Bridge Loans: Despite current market challenges, Ready Capital anticipates re-entering the origination market with a focus on high-quality multifamily bridge loans. This re-entry will be characterized by a more conservative underwriting approach, suggesting a deliberate and strategic expansion of its lending portfolio in this specific segment, which is expected to generate new revenue streams.

Ready Capital (RC) Capital Allocation Decisions (2021-2025)

Share Repurchases

• On January 16, 2025, Ready Capital's Board of Directors approved a new stock repurchase program authorizing the repurchase of up to $150 million of its common stock.
• Under the January 2025 program, the company completed the repurchase of 14,466,674 shares for $65.26 million by November 2025.
• In June 2023, the company announced a share repurchase program authorizing up to $100 million in buybacks. This followed an increase in September 2022 to an existing program by $25 million, bringing the total authorized under that program to $50 million.

Share Issuance

• In January 2022, Ready Capital commenced an underwritten public offering of 6,000,000 shares of common stock, with an option for underwriters to purchase up to an additional 900,000 shares. The net proceeds were intended for originating or acquiring target assets and general corporate purposes.
• Ready Capital's shares outstanding significantly increased by 49.32% in 2022 to 0.11 billion and by 55.42% in 2023 to 0.17 billion, indicating substantial share issuances during these periods, likely linked to acquisitions and public offerings.
• A new registration statement for a Common ATM Offering became effective in March 2025, enabling the company to sell common stock up to an aggregate of $150 million.

Outbound Investments

• In March 2025, Ready Capital completed the acquisition of United Development Funding IV (UDF IV), a real estate investment trust.
• In June 2023, the company completed the acquisition of Broadmark Realty Capital Inc., which was expected to create a prominent non-bank lender in the commercial real estate market with a pro forma equity capital base of $2.8 billion.
• In November 2021, Ready Capital acquired Mosaic Real Estate Credit, a platform specializing in construction lending, with the implied value of shares issued in the deal being approximately $471 million.

Capital Expenditures

• Ready Capital Corporation, as a real estate finance company and REIT, does not typically report significant traditional capital expenditures on property, plant, and equipment.
• The company's primary investment activities involve originating and acquiring various types of loans, such as $436 million in LMM commercial real estate originations and $348 million in Small Business Lending originations in Q4 2024.