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MarketScreener Homepage  >  Equities  >  Nyse  >  Great Ajax Corp.    AJX

GREAT AJAX CORP.

(AJX)
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GREAT AJAX CORP. : Entry into a Material Definitive Agreement, Unregistered Sale of Equity Securities, Amendments to Articles of Inc. or Bylaws; Change in Fiscal Year, Other Events, Financial Statements and Exhibits (form 8-K)

05/08/2020 | 06:11am EST

Item 1.01 Entry into a Material Definitive Agreement



Securities Purchase Agreement


On May 7, 2020, Great Ajax Corp., a Maryland corporation (the "Company"), and its operating partnership and manager, entered into a securities purchase agreement (the "Purchase Agreement") with affiliates of each of Flexpoint Ford LLC, Magnetar Capital LLC and Wellington Management Company LLP (the "Purchasers"). Pursuant to the Purchase Agreement, the Company, in a private placement made in reliance on the exemption from the registration requirements of the Securities Act of 1933, as amended (the "Securities Act"), afforded by Section 4(a)(2) of the Securities Act, agreed to issue and sell to the Purchasers 1,112,400 shares of the Company's 7.25% Fixed-to-Floating Rate Preferred Stock, par value $0.01 per share (the "Series A Preferred Stock"), and 87,600 shares of the Company's 5.00% Fixed-to-Floating Rate Preferred Stock, par value $0.01 per share (the "Series B Preferred Stock," and together with the Series A Preferred Stock, the "Preferred Stock"), each for $25.00 per share for gross proceeds of approximately $30,000,000 (the "Private Placement"). The Company also agreed to issue and sell to the Purchasers two series of warrants (the "Warrants") to purchase an aggregate of 1,500,000 shares of the Company's common stock, par value $0.01 per share ("Common Stock," and such Common Stock issuable upon exercise of the Warrants, the "Warrant Shares"), at an exercise price of $10.00 (the "Exercise Price") with an exercise period expiring five years after closing. The Warrants include a put option that will allow the Purchasers to sell the Warrants to the Company at a specified put price on or after August 7, 2023. The Company expects to use the net proceeds from the Private Placement to acquire mortgage loans and mortgage-related assets consistent with the Company's investment strategy. The respective preferences, limitations, powers and relative rights of the Series A Preferred Stock and Series B Preferred Stock are the same as the respective preferences, limitations, powers and relative rights of the Series A Preferred Stock and Series B Preferred Stock issued by the Company on April 6, 2020 as set forth in the Articles Supplementary filed by the Company with the Maryland Department of Assessments and Taxation on April 6, 2020.

As of December 31, 2019, Flexpoint Great Ajax Holdings LLC, an affiliate of Flexpoint Ford LLC, beneficially owned approximately 4.3% of our outstanding shares of common stock. Additionally, Steven L. Begleiter, our director, is a managing director of Flexpoint Ford, LLC, the manager of the investment fund that owns Flexpoint Great Ajax Holdings LLC. In accordance with our related party transaction policy, our board of directors, including all of the independent directors, and the audit committee each approved the issuance of Preferred Stock and Warrants to an affiliate of Flexpoint Ford LLC with the same preferences, limitations, powers and relative rights as the Preferred Stock and Warrants issued to affiliates of Magnetar Capital LLC on April 6, 2020.

Registration Rights Agreement

Pursuant to the terms of the Registration Rights Agreement entered into by and between the Company and the Purchasers, the Company shall, within 90 calendar days of April 6, 2020, use commercially reasonable efforts to prepare and file a Registration Statement (the "Registration Statement") with the Securities and Exchange Commission (the "SEC") to register for resale the Preferred Stock and the Warrant Shares, and use commercially reasonable efforts to cause the SEC to declare the Registration Statement effective within 180 calendar days after April 6, 2020.

The foregoing description of the Registration Rights Agreement does not purport to be complete and is qualified in its entirety by the full text of the Registration Rights Agreement attached as Exhibit 10.2 hereto.

Item 3.02 Unregistered Sales of Equity Securities

On May 7, 2020, the Company issued the shares of Preferred Stock and Warrants to the Purchasers in reliance on the exemption from registration under the Securities Act provided by Section 4(a)(2) of the Securities Act.

Item 5.03 Amendments to Articles of Incorporation or Bylaws; Change in Fiscal Year

On May 7, 2020, the Company filed Articles Supplementary with the State Department of Assessments and Taxation of Maryland (the "SDAT") to increase the number of authorized shares of Series A Preferred Stock and Series B Preferred Stock. The Company also filed Articles of Amendment to amend the Articles Supplementary filed with the SDAT on April 6, 2020.

The foregoing descriptions of the Articles Supplementary and the Articles of Amendment do not purport to be complete and are qualified in their entirety by the full text of the Articles Supplementary and the Articles of Amendment attached as Exhibits 3.1 and 3.2 to this Current Report on Form 8-K and incorporated herein by reference.


Item 8.01 Other Events


On May 7, 2020, the Company issued a press release (the "Press Release") announcing that the Company completed the issuance of shares of Preferred Stock and Warrants to the Purchasers. A copy of the Press Release is attached as Exhibit 99.1 to this Current Report on Form 8-K and is incorporated herein by reference.

Item 9.01 Financial Statements and Exhibits.



(d) Exhibits


Exhibit       Description

  3.1           Articles Supplementary
  3.2           Articles of Amendment to the Articles Supplementary
  4.1           Form of Series A Warrant
  4.2           Form of Series B Warrant
  10.1          Securities Purchase Agreement, dated May 7, 2020, by and among the
              Company, Great Ajax Operating Partnership LP, Thetis Asset Management
              LLC and the Purchasers named therein
  10.2          Registration Rights Agreement, dated May 7, 2020, by and among the
              Company and the Purchasers named therein
  99.1          Press Release dated May 7, 2020

© Edgar Online, source Glimpses

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Financials (USD)
Sales 2020 56,4 M - -
Net income 2020 16,8 M - -
Net Debt 2020 - - -
P/E ratio 2020 13,3x
Yield 2020 8,47%
Capitalization 226 M 226 M -
Capi. / Sales 2020 4,00x
Capi. / Sales 2021 3,52x
Nbr of Employees 1
Free-Float 86,9%
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Technical analysis trends GREAT AJAX CORP.
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Income Statement Evolution
Consensus
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Mean consensus BUY
Number of Analysts 4
Average target price 12,00 $
Last Close Price 9,80 $
Spread / Highest target 32,7%
Spread / Average Target 22,4%
Spread / Lowest Target 12,2%
EPS Revisions
Managers
NameTitle
Lawrence A. Mendelsohn Chairman & Chief Executive Officer
Russell A. Schaub President & Director
Mary B. Doyle Chief Financial Officer
Steve L. Begleiter Independent Director
J. Kirk Ogren Independent Director
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