Business Description

Apollo Commercial Real Estate Finance, Inc. is a corporation that has elected to be taxed as a REIT for U.S. federal income tax purposes and primarily originates, acquires, invests in and manages performing commercial first mortgage loans, subordinate financings and other commercial real estate-related debt investments. These asset classes are referred to as our target assets. We are externally managed and advised by the Manager, an indirect subsidiary of Apollo Global Management, Inc. (together with its subsidiaries, "Apollo"), a global, high-growth alternative asset manager with assets under management of approximately $938.4 billion as of December 31, 2025. The Manager is led by an experienced team of senior real estate professionals who have significant experience in underwriting and structuring commercial real estate financing transactions. We benefit from Apollo's global infrastructure and operating platform, through which we are able to source, evaluate and manage potential investments in our target assets. Our principal business objective is to acquire our target assets in order to provide attractive risk adjusted returns to our stockholders over the long term, primarily through dividends and secondarily through capital appreciation. As of December 31, 2025, we held a diversified portfolio comprised of approximately $8.7 billion of commercial mortgage loans and $62.2 million of subordinate loans and other lending assets. As of December 31, 2025, we had financed this portfolio with $6.3 billion of secured debt arrangements, $746.3 million senior secured term loans (the "Term Loans"), and $500.0 million of 4.625% Senior Secured Notes due 2029 (the "2029 Notes"). Additionally, as of December 31, 2025, we held $842.9 million of real estate assets, and $425.8 million of related financing. We are a Maryland corporation that was organized in 2009 and have elected to be taxed as a REIT for U.S. federal income tax purposes, commencing with the taxable year ended December 31, 2009. We generally are not subject to U.S. federal income taxes on our taxable income to the extent that we annually distribute our net taxable income to stockholders and maintain our intended qualification as a REIT. We also operate our business in a manner intended to allow us to remain excluded from registration as an investment company under the 1940 Act. PROPOSED TRANSACTIONS WITH ATHENE On January 27, 2026, we entered into an Asset Purchase and Sale Agreement (the "Purchase Agreement") with Athene Holding Ltd. ("Athene"). In connection with the transactions contemplated by the Purchase Agreement (the "Asset Sale"), we also entered into a letter agreement (the "Management Agreement Side Letter") with ACREFI Operating, LLC, a subsidiary of the Company ("Operating LLC") and the Manager, and a letter agreement (the "Expense Reimbursement Letter Agreement", and together with the Purchase Agreement and the Management Agreement Side Letter, the "Transaction Documents") with Apollo Management Holdings, L.P. ("Apollo Management Holdings"). Each of Athene and Apollo Management Holdings is a subsidiary of Apollo. The Purchase Agreement provides that, upon the terms and subject to the conditions set forth in the Purchase Agreement, Athene will purchase from the Company, and the Company will sell to Athene, the Company's entire commercial real estate loan portfolio (collectively, the "Loans") as of the date of closing of the Asset Sale (the "Closing"), other than two loans with a combined total principal balance of $146 million, as of December 31, 2025, currently held by the Company which are expected to be repaid prior to the Closing. Assuming the Closing occurs, our strategy and operations going forward may change. Refer to "Note 20 - Subsequent Events" to the accompanying consolidated financial statements for further detail. INVESTMENT STRATEGY To identify attractive opportunities within our target assets, we rely on the expertise of the Manager and its affiliates as well as their platform which integrates real estate experience with private equity and capital markets expertise, in transaction sourcing, underwriting, execution, asset operation, management and disposition.…