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American Home Mortgage Enters Into Agreement To Acquire Apex Mortgage Capital, Inc. American Home to Reorganize as a Real Estate Investment Trust (REIT).

Article Excerpt
Raises 2003 Earnings Per Share Guidance 27 % to $3.95 - $4.05 and 2004 Earnings Per Share Guidance 31% to $3.05 - $3.15 Assuming Consummation of the



Apex Merger* Projects 2004 Annual Dividend of $2.20 Per Share and Q4 2003 Dividend of $0.55 Per Share* Adopts Strategy of Holding Its Adjustable Rate Loan Originations as Long-Term Assets*

Subject to Final Transaction Adjustments, Apex Shareholders Calculated to Receive Approximately $6.21 Per Share in American Home Stock, an 11.3% Premium

to the Closing Price of Apex on July 11, 2003 *Projections and strategy adoption marked with an asterisk are for American Home and assume consummation of the Apex merger on or about September 30, 2003

MELVILLE, N.Y., and LOS ANGELES, July 14 /PRNewswire-FirstCall/ -- American Home Mortgage, Inc. , announced today it has signed a definitive agreement to acquire Apex Mortgage Capital, Inc. , a financial company structured as a Real Estate Investment Trust (REIT). The purchase price is based upon a floating exchange ratio, which is a function of Apex's book value and American Home's stock price at a time near the closing date. Based upon the most recently available information the exchange ratio would result in Apex shareholders receiving shares of American Home valued at approximately $186 million, or $6.21 per outstanding Apex share, representing an implied premium to Apex shareholders of 11.3%. The transaction is subject to approval by American Home and Apex shareholders and to other closing conditions.

In connection with the consummation of the merger, American Home will reorganize and elect to be taxed as a Real Estate Investment Trust with a wholly owned taxable subsidiary that will include its existing mortgage origination and mortgage servicing businesses. The origination and servicing subsidiary is expected to retain a significant portion of its ongoing net earnings, allowing it to continue to expand and diversify its lending franchise, including proceeding with its previously announced acquisition of Valley Bancorp.

American Home projects the transaction will be accretive to 2003 and 2004 earnings per share, as well as to its book value. Pro forma book value, as a result of the merger, and based on June 30 estimates, is projected to...

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