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Altisource Asset Management Corporation (AAMC) Q2 2023 Earnings Call Transcript

Altisource Asset Management Corporation (AAMC)

Q2 2023 Results Conference Call

Company Participants

Danya Sawyer - Chief Operating Officer of Lending Operations

Charles Frischer - Board Member

William Erbey - Shareholder

Presentation

Good day, and welcome to the AAMC Investor Call. Today's call is being recorded. At this time, I would like to turn the conference over to Danya Sawyer. Please go ahead.

Danya Sawyer

Good afternoon, everyone, and welcome to AAMC's Q2 2023 Earnings Conference Call. I'm Danya Sawyer, the Chief Operating Officer of Lending Operations at AAMC. Before we begin, I would like to remind everyone that certain statements made during this conference call may constitute forward-looking statements covered by the safe harbor provisions of the Private Securities Litigation Reform Act of 1995.

Forward-looking statements are not historical in nature. As described under Risk Factors in our annual report on Form 10-K, forward-looking statements are subject to a variety of risks and uncertainties that could cause the company's actual results to differ from its beliefs, expectations, estimates and projections.

Consequently, you should not rely on these forward-looking statements as predictions of future events. Statements made during this conference call are made as of today's date, and the company undertakes no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

As previously mentioned, today's call is being recorded, and a link to this webcast will be posted to our website later today.

Now I'd like to turn the call over to Charlie Frischer, member of our Board of Directors. Charlie?

Charles Frischer

Thank you, Danya, and thanks, everyone, for joining us today. I will report on positive developments in our significant legal matters, provide an update on our Lending Operations and talk about a potential new investment opportunity we are considering for the company. In the preferred shareholder case in New York, in June, the Appellate Division ruled in AAMC's favor and held that we did not breach any contractual obligation to redeem Luxor's preferred shares.

Luxor now seeks to take a second appeal, which we have opposed. We have also opposed a motion to dismiss our separate action in USVI Federal Court against Luxor Partner and former AAMC Director, Nathaniel Redleaf, alleging breach of fiduciary duty to AAMC. In a lawsuit against Blackrock and PIMCO in USVI Superior Court, AAMC status has been converted to party plaintiff.

Last month, a Staff Master assigned by the court to review pending motions issued his recommendations. He concluded that the court should exercise jurisdiction over 4 of the 5 Blackrock entity defendants and both of the PIMCO defendants. The Staff Master also recommended that all of AAMC tort and CICO claims -- damage claims be permitted to proceed.

The party's responses to the Staff Master's recommendations are due to be filed later this month. For detailed information regarding these matters, please refer to litigation disclosures contained in our second quarter 10-Q and prior public filings.

Let me now turn to the company's Lending Operations. The Board of Directors is undertaking a comprehensive assessment to determine what can be done to improve the performance of this business to bring it in line with the expectations of the Board and our shareholders. Our fix and flip, construction and other lending programs have not achieved profitability as fast as initially anticipated....

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