XML 30 R17.htm IDEA: XBRL DOCUMENT
v3.26.1

RELATED PARTY TRANSACTIONS | 3 Months Ended
--- | ---
Mar. 31, 2026
Related Party Transactions [Abstract] |
RELATED PARTY TRANSACTIONS | RELATED PARTY TRANSACTIONS Management and Incentive Fee The Company is externally managed and advised by the Manager. Pursuant to the terms of the Management Agreement, the Company pays the Manager a management fee equal to 1.5% of stockholders' equity per annum, calculated and payable quarterly (0.375% per quarter) in arrears. For purposes of calculating the management fee, the Company's stockholders' equity includes the sum of 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 the Company's retained earnings at the end of the most recently completed calendar quarter (without taking into account any non-cash equity compensation expense incurred in current or prior periods), less any amount that the Company paid for repurchases of the Company's common stock since inception, and excluding any unrealized gains, losses or other items that did not affect realized net income (regardless of whether such items were included in other comprehensive income or loss, or in net income). This amount will be adjusted to exclude one-time events pursuant to changes in GAAP and certain non-cash items after discussions between the Manager and the Company's independent directors and approval by a majority of the Company's independent directors. To the extent asset impairment reduces the Company's retained earnings at the end of any completed calendar quarter, it will reduce the management fee for such quarter. The Company's stockholders' equity for the purposes of calculating the management fee could be greater than the amount of stockholders' equity shown on the consolidated financial statements. Additionally, starting in the first full calendar quarter following January 3, 2020, the Company was also required to pay the Manager a quarterly incentive fee equal to 20% of the excess of Core Earnings (as defined in the management agreement) over the product of (i) stockholders' equity as of the end of such fiscal quarter, and (ii) 8% per annum. The initial term of our management agreement expired on January 3, 2023, with automatic, one-year renewals thereafter. For the three months ended March 31, 2026, the Company incurred management fees of $1,095,000 (March 31, 2025: $1,113,314), recorded as "Management and incentive fees" in the consolidated statements of operations, of which $1,095,000 (March 31, 2025: $1,110,000) was accrued but had not been paid, included in "Fees and expenses payable to Manager" in the consolidated balance sheets. For the three months ended March 31, 2026, the Company did not incur any incentive fees and for the three months ended March 31, 2025, the Company incurred incentive fees of $453,222, recorded as "Management and incentive fees" in the consolidated statement of operations, all of which the Manager agreed to waive that otherwise would have been incurred with respect to the quarter ended March 31, 2025. Expense Reimbursement Pursuant to the management agreement, the Company is required to reimburse the Manager for operating expenses related to the Company incurred by the Manager, including accounting, auditing and tax services, technology and office facilities, operations, compliance, legal and filing fees, loan servicing fees and miscellaneous general and administrative costs, including the cost of non-investment management personnel of the Manager who spend all or a portion of their time managing the Company's affairs. The Manager has agreed to certain limitations on manager expense reimbursement from the Company. For the three months ended March 31, 2026, the Company incurred reimbursable expenses of $466,431 (March 31, 2025: $404,620), recorded as "operating expenses reimbursable to Manager" in the consolidated statements of operations, of which $466,431 (March 31, 2025: $459,151) was accrued but had not yet been paid, included in "fees and expenses payable to Manager" in the consolidated balance sheets. Per the management agreement, any exit fees waived by the Company as a result of permanent financing by the Manager or any of its affiliates shall result in a reduction to reimbursed expenses by an amount equal to 50% of the amount of any such waived exit fee capped at a waived exit fee of 1%. For the three months ended March 31, 2026, the Company waived $60,000 in gross exit fees, reducing reimbursed expenses by $30,000 and for the three months ended March 31, 2025, the Company waived $71,698 in gross exit fees, reducing reimbursed expenses by $35,849. Lument Structured Finance During the period ended March 31, 2026, we purchased the following from Lument Structured Finance, LLC ("LSF"), an affiliate of our Manager: (a) two loans with an aggregate unpaid principal balance of $46.8 million at par; (b) one funded advance with unpaid principal balance of $1.1 million at a discount of $0.1 million and (c) one funded advance related to a real estate owned property with an aggregate unpaid principal balance $0.2 million. In connection with originating loans that are subsequently purchased by the Company and its subsidiaries, LSF or its affiliates may retain certain fees paid by borrowers in connection with the origination, processing and closing of such loans, including origination and processing fees. In addition, when certain loans are originated, they are often accompanied by different types of fees, including, but not limited to, exit fees that will be paid in certain circumstances. In certain instances when the Manager engages in a principal transaction with the Company, the Manager may decide not to transfer all the fees associated with a particular loan when such loan is transferred to the Company, subject to the consent of the Company. Instead, the fees or a portion of the fees may be retained by LSF or its affiliates, and LSF or its affiliates will earn the fees in the event they become due. To the extent a participation interest is involved, a pro rata portion of any fees associated with the underlying loan will be included with such participation. If the Company receives less than a pro rata portion of the fees, the Manager will disclose such arrangement and seek consent from the Company prior to transfer. However, if the Company purchases a loan from LSF or its affiliates that has not been fully funded at the time of the transfer, the Company may issue a participation interest in the loan back to LSF or its affiliates for the remaining unfunded amount. In such cases, any draw, advance or other fees earned in connection with any future funding of the loan will be retained by LSF or its affiliates, as the future funding participation holder. Lument Real Estate Capital, LLC Lument Real Estate Capital, LLC ("LREC"), an affiliate of our Manager, was appointed the servicer and special servicer with respect to mortgage assets for the 2021-FL1 CLO in June 2021, the LMF 2023-1 Financing in July 2023, the LMNT 2025-FL3 CLO in December 2025, the Repurchase Agreement in November 2025 and Loan Agreement in December 2025 and continues to serve in this role for the LMNT 2025-FL3 CLO, the Repurchase Agreement and the Loan Agreement. LREC no longer serves as servicer and special servicer for the 2021-FL1 CLO and LMF 2023-1 Financing due the their redemptions in December 2025 and February 2026, respectively. In connection with its role as servicer and special servicer with respect to mortgage assets held in the 2021-FL1 CLO through its redemption in December 2025, the LMF 2023-1 Financing through its redemption in February 2026, the LMNT 2025-FL3 CLO, the Repurchase Agreement and the Loan Agreement, LREC is paid certain fees under the 2021-FL1 CLO through its redemption in December 2025, the LMF 2023-1 Financing through its redemption in February 2026, the LMNT 2025-FL3 CLO, the Repurchase Agreement and the Loan Agreement depending upon the specific services rendered, including servicing fees, special servicing fees, workout fees and liquidation fees. In addition, LREC, as servicer and/or special servicer, may be entitled to retain certain fees or portions thereof paid by borrowers, including modification, waiver, assumption, transfer, processing, consent, review and similar fees, defeasance fees, late fees and application fees. During the three months ended March 31, 2026, LREC received servicing fees, inclusive of both servicing and special servicing fees of $103,557 compared to $142,195 for the three months ended March 31, 2025. LREC was also appointed as servicer with respect to mortgage assets held by the Company and its other subsidiaries in August 2022. Our Manager pays LREC's servicing fees, if any, which are reimbursed by the Company. Lument IM Lument IM was appointed as the collateral manager with respect to the LMNT 2025-FL3 CLO in December 2025, and continues to serve in this role. Lument IM was appointed as the collateral manager with respect to the 2021-FL1 CLO in June 2021 and LMF 2023-1 Financing in July 2023, and served in this role until their redemptions in December 2025 and February 2026, respectively. Lument IM has agreed to waive all its entitlements to collateral management fees for so long as Lument IM or an affiliate is the collateral manager and also the manager of the Company. Hunt Companies, Inc. One of the Company's directors is also Chief Executive Officer and President of Hunt Companies, Inc. ("Hunt") and is a member of the Hunt Board of Directors, with which affiliates of the Manager have a commercial business relationship. The Manager's affiliates provide servicing with respect to mortgage assets of Hunt and may from time to time sell commercial mortgage loans to Hunt or various of its subsidiaries and affiliates.

X
- References No definition available. + Details
Name: | us-gaap_RelatedPartyTransactionsAbstract
Namespace Prefix: | us-gaap_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration

X
- Definition The entire disclosure for related party transactions. Examples of related party transactions include transactions between (a) a parent company and its subsidiary; (b) subsidiaries of a common parent; (c) and entity and its principal owners; and (d) affiliates. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Topic 850 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 1 -Subparagraph (d) -Publisher FASB -URI https://asc.fasb.org/1943274/2147483326/850-10-50-1 Reference 2: http://www.xbrl.org/2003/role/disclosureRef -Topic 946 -SubTopic 20 -Name Accounting Standards Codification -Section 50 -Paragraph 2 -Publisher FASB -URI https://asc.fasb.org/1943274/2147480990/946-20-50-2 Reference 3: http://www.xbrl.org/2003/role/disclosureRef -Topic 946 -SubTopic 20 -Name Accounting Standards Codification -Section 50 -Paragraph 5 -Publisher FASB -URI https://asc.fasb.org/1943274/2147480990/946-20-50-5 Reference 4: http://www.xbrl.org/2003/role/disclosureRef -Topic 946 -SubTopic 20 -Name Accounting Standards Codification -Section 50 -Paragraph 6 -Publisher FASB -URI https://asc.fasb.org/1943274/2147480990/946-20-50-6 Reference 5: http://www.xbrl.org/2003/role/disclosureRef -Topic 946 -SubTopic 235 -Name Accounting Standards Codification -Section 50 -Paragraph 2 -Subparagraph (c) -Publisher FASB -URI https://asc.fasb.org/1943274/2147477968/946-235-50-2 Reference 6: http://www.xbrl.org/2003/role/disclosureRef -Topic 946 -SubTopic 235 -Name Accounting Standards Codification -Section 50 -Paragraph 2 -Subparagraph (e) -Publisher FASB -URI https://asc.fasb.org/1943274/2147477968/946-235-50-2 Reference 7: http://www.xbrl.org/2003/role/disclosureRef -Topic 946 -SubTopic 220 -Name Accounting Standards Codification -Section S99 -Paragraph 1 -Subparagraph (SX 210.6-07(2)(g)(3)) -Publisher FASB -URI https://asc.fasb.org/1943274/2147479134/946-220-S99-1 Reference 8: http://www.xbrl.org/2003/role/disclosureRef -Topic 946 -SubTopic 220 -Name Accounting Standards Codification -Section S99 -Paragraph 1 -Subparagraph (SX 210.6-07(2)(c)) -Publisher FASB -URI https://asc.fasb.org/1943274/2147479134/946-220-S99-1 Reference 9: http://www.xbrl.org/2003/role/disclosureRef -Topic 946 -SubTopic 220 -Name Accounting Standards Codification -Section S99 -Paragraph 1 -Subparagraph (SX 210.6-07(2)(e)) -Publisher FASB -URI https://asc.fasb.org/1943274/2147479134/946-220-S99-1 Reference 10: http://www.xbrl.org/2003/role/disclosureRef -Topic 850 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org/850/tableOfContent Reference 11: http://www.xbrl.org/2003/role/disclosureRef -Topic 850 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 6 -Publisher FASB -URI https://asc.fasb.org/1943274/2147483326/850-10-50-6 Reference 12: http://www.xbrl.org/2003/role/disclosureRef -Topic 850 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 1 -Subparagraph (a) -Publisher FASB -URI https://asc.fasb.org/1943274/2147483326/850-10-50-1 Reference 13: http://www.xbrl.org/2003/role/disclosureRef -Topic 850 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 1 -Subparagraph (b) -Publisher FASB -URI https://asc.fasb.org/1943274/2147483326/850-10-50-1 + Details
Name: | us-gaap_RelatedPartyTransactionsDisclosureTextBlock
Namespace Prefix: | us-gaap_
Data Type: | dtr-types:textBlockItemType
Balance Type: | na
Period Type: | duration