Ladies and gentlemen, thank you for standing by. The Eagle Point Credit Company conference call will begin in two minutes. Once again, we thank you for standing by. Our conference will begin in two minutes. Greetings and welcome to the Eagle Point Credit Company Inc.'s Second Quarter 2025 Financial Results Conference Call. At this time, all participants are in a listen-only mode. A question and answer session will follow the formal presentation. If anyone should require operator assistance during the conference, please press star zero on your telephone keypad. As a reminder, this conference is being recorded. It is now my pleasure to introduce your host, Darren Daugherty from Prosek Partners. Thank you. You may begin. Thank you, Operator, and good morning. Welcome to Eagle Point Credit Company's earnings conference call for the second quarter of 2025. Speaking on the call today are Thomas Majewski, Chief Executive Officer, and Ken Onorio, Chief Financial Officer and Chief Operating Officer. Before we begin, I would like to remind everyone that the matters discussed on this call include forward-looking statements or projected financial information that involve risks and uncertainties that may cause the company's actual results to differ materially from such projections. For further information on factors that could impact the company and the statements and projections contained herein, please refer to the company's filings with the Securities and Exchange Commission. Each forward-looking statement or projection of financial information made during this call is based on the information available to us as of the date of this call. We disclaim any obligation to update our forward-looking statements unless required by law. Earlier today, we filed our second quarter 2025 financial statements and investor presentation with the Securities and Exchange Commission. These are also available on the Investor Relations section of the company's website, eaglepointcreditcompany.com. A replay of this call will also be made available later today. I will now turn the call over to Thomas Majewski, Chief Executive Officer of Eagle Point Credit Company. Tom? Thank you, Darren. Good morning, everyone, and thank you for joining us on the call today. I'd like to start off by sharing the company's earnings for the second quarter. The company generated net investment income less realized losses from investments of $0.16 per share. This consisted of $0.23 of net investment income and was offset by $0.07 of realized losses from investments. The realized losses from investments were principally driven by a reclassification of certain unrealized losses and essentially had no NAV impact. In fact, our NAV as of June 30th was $7.31 a share, which was up 1.1% from the $7.23 NAV as of March 31st. For the second quarter, the company generated a non-annualized GAAP total return on equity of 6.3%. Recurring cash flows from our portfolio remain strong. Second quarter recurring cash flows were $85 million or $0.69 per share, and this exceeded our quarterly aggregate common distributions and total expenses by $0.08 per share. Q2 cash flows were higher than the $80 million or $0.69 per share in the first quarter. The higher recurring cash flows were driven by our proactive refinancing and reset program, outsized first-time CLO equity payments through our opportunistic new issue opportunities, but were slightly hurt by a few basis points of loan spread compression during the quarter. We remained active in portfolio management during the quarter, deploying $86 million into new investments. Importantly, we were able to take advantage of the market dislocation in April and May to acquire CLO equity positions at attractive discounted levels. We expect these investments to contribute to our portfolio's earning power in future quarters. During the quarter, we completed four resets and one refinancing. The reset and refinancing market, which was quiet during the peak of volatility in April, has since picked up. We have a strong pipeline of additional opportunities that we expect to execute on throughout the remainder of 2025. We believe our continued refinancing and reset activity will reduce CLO financing costs and ultimately lead to higher CLO equity distributions, resulting in higher net investment income for the company. Our portfolio's weighted average reinvestment period, or WARP, stood at 3.3 years as of June 30th, and this was roughly 44% above the market average of 2.3 years. If the dislocation had been more prolonged, the company's portfolio was well positioned to capitalize on the market disruption by purchasing loans at discounted levels within our CLOs. From a new issuance perspective, the arbitrage for new CLO equity investments was less attractive today than it was before the volatility began in April. AAA spreads currently stand around 130 basis points over SOFR, and this is roughly 20 basis points wider than the volatility in March and April. However, we have a few loan accumulation facilities in different stages of formation, and we'll continue to opportunistically invest in new issue CLO equity when the math is attractive. During the quarter, we utilized our at-the-market program to issue $41 million of common stock at a premium to NAV, and this resulted in accretion of NAV by $0.02 per share during the quarter. We also issued approximately $38 million of our 7% Series AA and AB convertible perpetual preferred stock as part of our continuous public offering program. We believe the 7% distribution rate on this perpetual preferred stock represents a very attractive cost of capital for the company, and it provides us with a material advantage over our competitors. Indeed, we are unaware of any other publicly traded entity focused principally on investing in CLO equity that has such an attractive financing program. During the quarter, we also entered into our second strategic CLO collateral manager partnership, establishing a new CLO collateral manager within a longstanding established credit management platform. As with our other strategic relationship, we received a meaningful perpetual top-line revenue share in the CLO business. We believe the potential value creation through these strategic partnerships will meaningfully enhance shareholder returns over time. Indeed, ECC's share of our first partnership is now valued at over $2 million, and I believe there is room to grow a bunch more. During the second quarter, we paid $0.42 per share in cash distributions to our common stockholders across three monthly distributions of $0.14 per share. Earlier today, we declared regular monthly distributions of $0.14 per share for the fourth quarter of 2025. The company's board of directors considers numerous factors when setting the monthly distribution level, including cash flow generated from the company's investment portfolio, GAAP earnings, and the company's requirement to distribute substantially all of its taxable income, among other considerations. Finally, I'd like to highlight Eagle Point Income Company, which trades on the New York Stock Exchange under the symbol EIC. EIC principally invests in junior CLO debt securities. We'll be hosting an investor call for EIC today at 11:30 A.M., and we invite you to join us. Ken will now provide some more details on our financial results, and after his remarks, I'll share some insights on the loan and CLO markets. Thank you, Tom, and thanks everyone for joining our call today. For the second quarter of 2025, the company recorded net investment income, less realized losses on investments of $20 million or $0.16 per share. Net investment income for the second quarter was $0.23 per share. Included in the second quarter realized losses from investments was $0.05 per share of realized losses from the reclassification of unrealized losses for three CLO equity positions outside of their reinvestment period that had been written down to fair value. Since the fair value of these investments had already been reflected in the company's NAV, this was an accounting reclassification from an unrealized loss with little to no impact to NAV. Excluding the reclassification, the second quarter NII, less realized losses on investments, would have been $0.21 per share. This compares to NII and realized gains of $0.33 per share in the first quarter of 2025 and NII, less realized losses of $0.16 per share in the second quarter of 2024. Additionally, for the second quarter of 2025, the company recorded losses from forward currency contracts of $0.08 per share, which were substantially offset by unrealized gains on non-U.S. dollar denominated investments, resulting in little to no impact to NAV. When unrealized gains are included for the second quarter, the company recorded GAAP net income of $58 million or $0.47 per share. This compares to GAAP net losses of $0.84 per share in the first quarter of 2025 and $0.04 per share in the second quarter of 2024. The company's second quarter GAAP net income was comprised of investment income of $48 million and unrealized gains on investments of $55 million, offset by financing costs and operating expenses of $20 million, realized losses from forward currency contracts of $10 million, realized losses on investments of $8 million, distributions and amortization costs on temporary equity of $4 million, and unrealized losses on certain liabilities held at fair value of $3 million. As a reminder, temporary equity refers to our multiple series of perpetual preferred stock. Additionally, the company recorded other comprehensive income of $2 million for the second quarter. The company's asset coverage ratios as of June 30th for preferred stock and debt calculated pursuant to Investment Company Act requirements were 243% and 525% respectively. These measures are above the statutory requirements of 200% and 300%. Our debt and preferred securities outstanding at quarter end totaled 41% of the company's total assets less current liabilities, above our target range of 27.5%- 37.5% when operating the company under normal market conditions. As of July 31, our pro forma leverage was 40%, but we expect the leverage ratio to revert back to our target range over time. Consistent with our long-range financing strategy for the company, all of our financing remains fixed rate, and we have no maturities prior to April 2028. In addition, a significant portion of our preferred stock financing is perpetual with no set maturity date. During the second quarter, we deployed $86 million in gross capital into new investments. As Tom noted, we were particularly active in April and May, taking advantage of market dislocations to acquire CLO equity at attractive levels. In the current quarter through July 31, the company has received recurring cash flows on its investment portfolio of $66 million. We expect additional collections throughout the balance of the quarter. Additionally, management's unaudited estimate of the company's NAV as of July 31 was between $7.44 and $7.54 per share, an increase of 2% from quarter end. I will now hand the call back over to Tom for his market insights and updates. Thank you, Ken. Let me share some updates on what we're seeing in the loan and CLO markets. The S&P/LSTA Leveraged Loan Index experienced a relatively brief period of volatility during the second quarter, declining sharply in April following the pullback that we saw in March amid tariff-related pressures. The index recovered in May and June and ended up with a total return of 2.3% for the second quarter. The loan index ended up almost 3% during the first half of the year and continued performing well through July, ending the month up 3.8% for the full year. The recovery in loan prices has been encouraging, though we note that CLO equity has not yet fully participated in this recovery. We view this as a potential tailwind for our portfolio as we move through the second half. During the second quarter, there were four leveraged loan defaults, and as of June 30, the trailing 12-month default rate for loans stood at 1.1%. This is well below the long-term average of 2.6% and certainly below most dealer forecasts. We did see one notable default in June with Altice, representing approximately 38 basis points of the CLO market defaulting, although the event was largely anticipated by market participants and priced in well before the action. Our portfolios' look-through default exposure as of June 30 stood at 32 basis points, which remains well below the broader market levels. We've also seen an increase in liability management exercises by leveraged loan borrowers. These are essentially out-of-court restructurings where CLOs can be the beneficiaries when working with top-tier collateral managers and with Eagle Point's CLO document expertise. Our portfolio has generally been well positioned in these situations, and we've actually seen net par build in our holdings of CLO equity over the past year, despite the out-of-court restructuring activity. In many cases, our CLOs have been able to be on the winning side of the restructurings. In terms of new CLO issuance, we saw $51 billion of volume during the second quarter, with most of the activity concentrated in the latter part of the quarter as markets stabilized. This was down slightly from $53 billion in the second quarter of 2024. Reset and refinancing activity for the second quarter was $44 billion and $9 billion, respectively. While the new issue arbitrage appears less attractive today due to AAAs being around 130 basis points over SOFR, there have been a number of attractive opportunities for new issue CLOs that have come our way, and we will continue to evaluate opportunities highly selectively. Our portfolio metrics reflect the strength and resilience of our positioning. As of quarter end, CCC exposure within our CLO equity portfolio was 4.9%, and this is notably lower than the broader market average of 6.5%. Similarly, only 2.7% of our CLOs were trading below $80, and this compares to 5.1% for the broader market. Finally, our weighted average junior OC cushion stood at around 4.6% at quarter end, again well better than the market average of about 3.5%. These are important measures that underscore the quality of our CLO equity portfolio. Looking ahead, we have a very positive outlook for our portfolio. The tariff concerns that drove April's volatility have largely subsided. CLO equity still appears to offer upside as it catches up to the broader market recovery, and our extensive pipeline of resets and re-financings should continue to enhance the earnings power of our portfolio. Our long weighted average remaining reinvestment period provides continued optionality to capitalize on future periods of market volatility. We continue to believe that periods like what we experienced in April, while challenging from a short-term mark-to-market perspective, ultimately present opportunities for CLO equity investors with the right positioning and patience. Indeed, despite the volatility in April, our NAV was up for the quarter, and we also paid substantial cash to our shareholders. Our portfolio's defensive characteristics and long WARP position us well to benefit from these market disruptions in the long term. To summarize the quarter, while net investment income was at the lower end of our expectations due to the factors Ken and I previously discussed, NAV was up nicely, and we see clear catalysts for improvement ahead. We successfully deployed capital at attractive levels during the market dislocation and believe our portfolio continues to maintain superior metrics compared to the broader market. We have significant optionality through our reset and refinancing pipeline to continue enhancing returns as well. We believe our portfolio is well positioned for continued strong performance as we move through the second half of 2025. We thank you for your time and interest in Eagle Point Credit Company. Ken and I will now open the call to your questions. Operator? Thank you. If you'd like to ask a question, please press star one on your telephone keypad. A confirmation tone will indicate your line is in the question queue. You may press star two if you'd like to remove your question from the queue. For participants using speaker equipment, it may be necessary to pick up your handset before pressing the star keys. Our first question comes from the line of Mickey Schleien with Clear Street. Please proceed with your question. Good morning, Tom and Ken. Nice to speak to you today. Tom, you mentioned that CLO AAA spreads still remain above pre-liberation day levels, and it seems CLO equity prices are being driven more by a risk aversion mentality than by actual deterioration in cash flows. Do you think the market's correct in terms of the risks to cash flows that it seems to be seeing? What's it going to take to turn this mentality around? Age-old question, and congratulations on the new role as well. As I look at our NAV, here we are in July, we're up from where we stood on a non-trivial basis based on the July estimate of $7.49, midpoint up from the March number. Both net of paying out our distributions, the portfolio outperformed the distribution rate, which is great. That's what we'd like. We like high distributions and NAV going up. We got past a bunch of it. There are kind of a couple of things that move around with this. There's the demand level for AAAs, and one of the challenges in the CLO AAA market, you've got a relatively small number of big players compared to the syndicated loan market where there's, I'm going to guess, 100 investors who could easily buy $100 million of a loan. In the CLO market, it's a much smaller universe of investors to the extent some of them turn on and off. The Japanese banks, the U.S. banks, decisions of five to ten people can somehow turn ebb and flow on the demand there, which is complicated. You've got loan spread compression, which we've got a thousand plus loans, and they can sometimes move against you in ways different than the CLO market moves. To the extent you see loan spreads tightening, but not CLO debt spreads tightening as much. Finally, just the discount rate or yield that CLO equity investors are applying. The amalgamation of all those three things kind of go into what's a CLO worth, where a CLO can be created. They do, in our history, over well over a decade now, move in and out of favor. Very rarely are all three of them screaming in our favor, loan spreads widening and CLO debt spreads tightening and people tightening their risk assumptions. They never stay out of sync for an extended period of time. We've seen it nine, twelve months, something like that over the years. Where we look today, and if you look at July performance unto itself, NAV was up 2.5%, obviously, and that's net of the distributions, which would suggest the ROE. I'm cuffing this generically in the 5% area for the month. We are seeing some of that kind of come back. CLO equity or CLO debt or corporate debt lags the stock market. CLO debt lags the corporate market, and CLO equity lags the CLO debt market. Whereas a lot of things kind of snap back in May, June, and we certainly were in the upper trajectory, we're seeing the real kind of get back ahead of where we were in March happening in July. It moves in and out of sync. We love when NAV goes up, but we don't jump up and down. We don't really cry when NAV goes down, although we're not thrilled. What we look at first and foremost is the portfolio cash generation. As you look at the trend of that, despite all the different things that have happened over the last few years, it's trickled up on a per share basis, not every single quarter, but certainly in the right direction. The aggregate amount has certainly continued to grow handsomely. We're pleased with where we are. Recurring cash flows, not cash flows from calls or anything like that, continues to cover all the distributions, all the expenses. All the right things are happening. It'd be great to see the marks come up, frankly. I don't want to say it's unimportant, but we're here to generate cash flow, and what you'll see in our portfolio is very consistent cash flow over an extended period of time. That's helpful, Tom. It sounds to me like you're of the view that perhaps we've turned the corner and this risk-off mentality may revert, which would be great. Just one sort of housekeeping question, maybe for Ken. What drove the realized losses this quarter? Sure. A couple of components. The $0.02 from trading realized losses. There were $0.05 in writing off three CLO equity positions that were past their reinvestment period and no longer generating any cash flow or income. That was the reclassification that we mentioned in our prepared remarks. Right. Reported separately was $0.08 on currency hedges on forward contracts, which were again offset by unrealized gains in the investment portfolio. Net-net, there were effectively $0.02 that was driven by trading and the rest were portfolio dynamics. Those trades simply are relative value trades. We sold some of here. We like something better. We wouldn't necessarily flash a giant loss to do that, but $0.02 is, we're not, we don't lose a lot of sleep over that. We did break out, I think this is the first or second quarter we're breaking out the currency stuff because we do have some European investments in here. Those are typically on 90-day rolling currency hedges. Correct. Those will generate some realized gains and losses, but assuming we're doing it right, that's offset by unrealized gains or losses in the underlying investments. We think it makes sense to show those a little separately. Overall, the notable number there was $0.02 of realized losses, but those were to get into other things we like better. I understand. That's it for me this morning. Thank you for taking my questions. Great. Thank you, Mickey. Thanks Mickey. Thank you. Our next question comes from the line of Randy Binner with B. Riley Securities. Please proceed with your question. Hey, good morning. Thanks. I have a few. Good quarter. Just picking up on the last part there, Tom, the European investments, is that because the FX actually jumped out to me a little bit more this quarter than it had in the past? Is Is there better relative value over there? Is that a notable percentage of your activity? Just be curious on those two points. There was some pickup in opportunity over there in the last two or three quarters. If you look over time, the European CLO equity percentage has certainly crept up a little bit. It's not a material driver of our program, but we're seeing some attractive opportunities there, which have made us move in to some degree into that market. We're trying to neutralize the FX, though. We do this in a number of our funds, so it was a relatively standard course for us. I wouldn't expect to see the portfolio be 50% Europe or something like that, but could it go up a couple more% depending on opportunities? Yes. Whereas in our opinion, the 1.0 CLOs might not have done so well over there. Certainly, a number of the 2.0 CLOs seem to have done pretty well. Selectively, we will add those to the portfolio. Okay. Is it like less than 5% of the portfolio, just total size-wise? I'm going to say between 5 and 10 without having the number right off the top of my head. Yeah, that's fine. Just looking for rough justice there. The other question I had is, I heard all the commentary to Mickey's question there just about spreads, but kind of just thinking about the all-in yield, you know it does seem to be coming kind of off the levels we saw in the back half of last year in the first quarter. Just from a kind of an all-in yield perspective, especially if the Fed cuts rates, would we expect that to kind of be at the level we saw this quarter and kind of flat to declining, right? I mean, is that the right way to think of it for modeling kind of like top-line NII? Yeah. If you were to chart the weighted average expected yield of the portfolio, we don't like it. If you look at it over the last eight quarters, just let's put it out there, it's down more than it should be. I know everything we do here is floating. Substantially everything you do is floating rate on the left side and the right side. We're the people who have more things going on in credit than average, and interest rates have such a little impact on us in that the vast majority of the cash we collect is attributable to the difference in the spread of the loans versus the CLO debt. If you look on the way up, rates went from 0% to 5%, you can see a relatively, if you look back over history, you can see a relative, and we published, if you look at like our, take our shareholder decks and just pick one a year for the last four years, you can kind of get the trend of interest rate movement and see what it does. It doesn't hurt, but it doesn't really help in any meaningful way. At the same time, if rates were to go back down, we don't anticipate any meaningful, holding all else constant, of course, we don't expect any meaningful decline in cash flows from rates falling. EIC, which is mainly CLO double Bs, because a significant portion of the return is from the base rate, it's more susceptible to changes in base rate. What we've got here in ECC, rates are not a primary driver. The thing that's brought the effective yield down, frankly, is just the sheer wave of spread compression, particularly over the last six to nine months. One of the things you can see looking in those full investor presentations, and again, we try and be super transparent. Here's every single CLO, here's the AAA spread, here's the weighted average, here's the loan spread, here's the WARP. You can see everything we got going on. What you'll see is the weighted average spread on the underlying CLO loans has come down directionally 50 basis points. It might be a little higher or a little lower, then you check the numbers online to be sure. Defaults have remained very low, so that's good. That said, many of our CLOs have actually built par, so that's good. The recurring cash flows have been hurt somewhat by loan spreads coming down. We've offset them with what we call reset and refi mania here, where we're very actively and have reset dozens and refi dozens of CLOs over the last year or two. What we're doing there is trying to rip out the cost on the right side. One of the things you can look at, if you look at our portfolio, if you look at the AAAs on a CLO by CLO basis, you can see some of them are still, if the market's kind of 130 today, give or take, you can see the number, we've still got a lot over 130. That suggests we've still got more gas in the tank there. Okay. That's the one thing. One of the analogies I like to make, we've got well over a thousand loans and we've got 125, 150 CLOs, something like that. We've got a wall of sand coming at us on one side with loans repricing, and we've got to move boulders on the other side. The sand comes at you really quickly. It takes a while to move the boulders. I would wager to say no one does more refis and resets than us. We have some CLOs that have AAAs well inside of 130 as well. Obviously, we're not touching those, but we're doing our best to reduce costs on the right side wherever we can. The thing that's brought our weighted average effective yield down has been the spread compression over the years. It sort of feels like it's bottom-ish, but the loan market is a powerful force. If the tide moves one way, the tide moves one way. At some point, it can't get out of whack for too extended of a period. We're definitively not calling a bottom. That's the thing that's worked against us so far. Our part, we're trying to buy the best CLOs. We're trying to proactively rip out as much cost on the right and buy us as much runway as possible. All right, understood. Appreciate the responses. Thank you. Thank you. Ladies and gentlemen, as a reminder, to join the question queue, please press star one on your telephone keypad. Our next question comes from the line of Erik Zwick with Lucid Capital Markets. Please proceed with your question. Thank you. Good morning, Tom and Ken. I wanted to first just start on an announcement in the press release in your prepared remarks about forming the second CLO collateral manager partnership and if this is something that was in the works for a while and kind of how that came about and maybe can just expand on the opportunity and potential financial benefit. Great. This is the second one we've done. What we're doing is across all the different CLO equity portfolios here at Eagle Point, collectively, we commit $100 million, $200 million to provide capital for the initial CLOs of a firm. We did this the first time. It's gone very, very well. Now we're trying to do it again. A couple of things that are important to us: we're not taking any operating expenses. They hire all the team, the salaries, the Bloombergs, the offices, all that kind of good stuff. We provide some CLO equity capital to get everything going, as well as stewardship on the issuance process. I would say we're amongst the best in the market, in my opinion, of shepherding a CLO issuance process. The first one we've done, I think the firm has issued six CLOs and already reset two of them, if memory's correct. I might be off slightly on my stats there. We invested all of our committed capital, and they're now raising capital away from third parties, which is great. Now our funds, including Eagle Point Credit Company, are scraping some of this top-line revenue off of fees charged to other CLO investors, maybe others that have public funds even for all I know. That's great. The cost of it is upfront. We have to take probably some suboptimal CLOs. That's not our favorite, but it's a long game. Like in the first joint venture or partnership, CLO one, I remember I think the AAAs are going to say like $240 over or something like that, some ridiculously high number. We did that back at a time when tier one versus newer collateral managers, there was a big spread in AAAs. You can't time the market, you can't time everything, but as soon as that first CLO hit the reset date or the non-call date, we reset it. I'm going to say the AAAs came down by 100 basis points or something like that. We probably had to pinch our nose for the first two years, frankly. Now those are in great shape and the platform's doing great. They're winning CLO debt manager of the year, maybe even new collateral manager of the year or something like that. They've won a number of awards and things like that. We've kind of positioned that business to grow and thrive. We've given it the solid footing and we're letting them run the rest of the way. We're trying to do that same thing here with number two and let them go and thrive and give them the solid footing to start. Now, the market we're in today, whereas when we set up collateral manager one, the difference between where a Blackstone or Carlyle would price on their AAAs and where that platform priced for their first deal, generically 50 basis points back on the AAAs. That's a lot. That stinks. Today, the market's much tighter, maybe 3- 10 basis points back. Whereas we had a little more J curve on that first investment, we don't anticipate having it here. I think the timing on that one might not have been ideal, but we're thrilled. We've paid the price and now we're harvesting the dividends, literally and figuratively. We think we're starting opportunity two in another spot, in a much better spot. As we look across, there's one externally managed public BDC that has an RIA in it. There's at least one internally managed BDC that also has an RIA in it. The one you'll probably figure out I'm thinking about. We looked at their financials just curiously, and this is not what we're at. We won't be able to do this, unfortunately. Their RIA grew, I think, from 2012. They carried it at $300 million. If memory serves, the last financials I saw, they had the RIA carried at $2 billion. Very, very meaningful NAV accretion along the way. Those businesses generate cash flow. We don't quote unquote own an RIA here. We just have a top-line revenue share in the business. That might even be better. This way, we have no operating risk. We're not covering costs or anything. Just more money they bring in, we get a percentage of it. We're really excited about that. That one's valued at a couple million dollars on our books. I said in our prepared remarks, I used a specific measure. I think it could go up a bunch. I wanted to put a higher number maybe than the lawyers would let me, but it should keep going. We're hopeful opportunity two will do that. It's been in the works for a while. We continue to talk about other opportunities as well, whether or not they come to fruition, who knows? We've got to be very selective on it. Those where we think the formula is right to create world-class CLO collateral managers that manage billions or tens of billions of dollars, if we can put up a little dough and have a non-trivial piece of the upside, rinse and repeat. That's a very helpful caller. I appreciate it. Just the second and kind of last question for me, you mentioned the attractiveness of the preferred issuance that you've been doing kind of around 7% or so. Another way to fund new investments is just as existing portfolio repays. I'm looking at slide 20 in your deck now. Year-to-date annual repayment rate has been down a little bit relative to last year and still kind of below that longer-term average you show there. I guess, how sensitive are those repayments to lower rates? If we assume that the forward SOFR curve is correct, would you expect to see that repayment rate particularly potentially tick up over the next kind of six to twelve months if we see some reductions in SOFR? Really good. Importantly, it's important to remember the loans are all floating rate. If rates go down, the interest rate on all these loans will just go down automatically. Rates are not a driver of repayments. It's bullish and bearishness on spreads as the principal driver. If you look back to some very high periods, 2013, 2017, 2021, this is on the chart on page 20, even 2024, although slightly below average, those were years that were generally characterized as bullish years. The vast majority of repayments or prepayments here, whatever they may be, are driven by two things: loans, companies out repricing their loans tighter, not related to interest rates, but related to spreads. If you look at our weighted average loan spread over time, you'll see it goes down shortly after these periods of high repayments. That's really what's driving this. It's opportunities to reprice tighter. In general, when debt markets are strong, there's going to be more M&A activity and sponsor selling companies, and loans typically get repaid when there's M&A activity. Some have portable capital structures, but the vast majority need to be paid off. Those are the things going on. Kind of 20%, 15% to like the 2022, 2023 numbers are kind of my favorite because it says there's not a lot of loan spread compression going on then. We did see it in 2024, and that manifests itself in the 27.9% number we saw. This is principally a bullish bearish sentiment on loans that's going to drive this. The more bullish things are, the higher you're going to see prepays. Rates aren't a driver in this chart. Got it. No, that's helpful. I appreciate that. Kind of maybe switching gears a little bit, but similar thought process. If SOFR comes down, the assets reprice automatically. You still have some existing opportunity for resets and refis. That typically lags, right? Because the assets are going to reprice automatically, but it takes a little while for you in the kind of controlling equity portion to work through the liability side. Is that correct? Like there's a lag there. The assets and liabilities of a CLO are, with a small exception, maybe there's some fixed-rate bonds. In general, the assets and liabilities of CLOs are all floating rates. Rates moving up and down just kind of autocorrects back and forth between the two. The slight loans reset at random dates, CLOs reset four times a year. There's a little bit of variability, but not meaningful there. Rate-based movement largely cancels out. If you had a big round of spread compression, presumably CLO AAAs are coming in, but it just takes a little while to get through them all. We have a dedicated team that does pretty much just that. The prepayments are the thing that are going to drive loan spread compression, which is going to then make us have to do more refis, resets. Okay. Great. I appreciate you taking my question today. Thank you. Thank you. Our next question comes from the line of Christopher Nolan with Ladenburg Thalmann. Please proceed with your question. Hi. Thanks for taking my question. As a follow-up to the reply that you gave to Mickey's question, talking about how following Liberation Day, the sentiment seems to be eased off in terms of the risk. Going forward, should we expect, given energy costs seem to be coming down, that cash coverage of loans will go up? Possibly, what would this mean for the effective yields for CLO equity? Thank you. Good question. Cash coverage on loans does not unto itself impact CLO equity cash flows. Let's just say the price of, I think the president wants to see the price of oil at $50 a barrel. If you fill up your car or you're on an airline or something like that, that's music to your ears. To a company that invariably has, every company has some degree of fuel costs in their inputs depending on what they do, that would help lower energy costs. Holding all else constant would help free cash flow at many, many companies. It would not necessarily create more cash into our CLO in that the companies are just required to pay the stated interest rate on their loan, which is going to float around with LIBOR. It probably does lower the risk of default if companies, again, have lower expenses, but that unto itself is not going to be a change in energy costs or things like that, not going to be a direct driver of picking up of increases in CLO cash flow. The things that are probably the biggest potential drivers of increase in recurring cash flow in our portfolio are limited spread compression. You see it's certainly slowed significantly. Our ability to reset and refinance and just lower costs in our portfolio are very, very important. Selective new issue investments, which can be particularly juicy, but you need the stars and moons to align on that right now. We are working on doing as many of those as we can, but it's us improving the cash flow capability of the CLOs through having minimal spread compression and us ripping out costs on the right are going to be the principal things that drive an increase in recurring cash flow for us. Great, thank you. You're welcome. Thank you. Our next question comes from the line of [Shalab Barish] with [Vincent Camp Advisors]. Please proceed with your question. Hi, Tom. Hi, Ken. Thanks for taking the question. My question was, I had a couple of questions, actually. First of all, can you shed any light, if possible, on what drove the significant sell-off in the CLO equity closed-end funds recently? The short answer is more sellers than buyers. Okay. That's the number one driver. I think what [Shalab's] getting at is ECC and a fair number of CLO equity-oriented funds saw a non-trivial drawdown in their share prices over the last few months. In my opinion, unwarranted, but any number of things could be going on with that. Some fear of tariff-related increase in defaults might be one thing. It's hard to, you know, I keep an eye on the random inbounds that come into the investor relations box. Some people ask about defaults. Some people ask about war, all these different things. Okay. No one asked about spread compression to my recollection. I can't say I read every one that came in. If someone, if I could wave my magic wand and change one thing, it would just be set the loan spreads back to where they were nine months ago. Ken and I would be dancing, holding all else constant. We don't dance often around here. We get these random, you know, we don't get it. The bombs going in Iran for a period of time. There's certainly economic uncertainty with the rapidly changing tariff regimes. In my opinion, if you and I were on the board, the capital allocation board of a big industrial company, and we're deciding should we build a plant right now or not, maybe we're supposed to wait a little bit. Obviously, if we're halfway through the project, we're probably going to complete it. Hey, let's go buy some land and dig a hole and create thousands of jobs and build something. Maybe we'll wait. The concerns are not invalid that there's going to be, there's more uncertainty in economic outcome, economic behavior, economic regulation for sure. The flip side, we've been through COVID. We've been through the financial crisis. We've been through China stuff. We've been through the tech telecom terrorism stuff in 2002. Underestimating particularly below investment, large cap, below investment grade companies in America, typically sponsor backed, has generally been the wrong idea for an extended period of time. If you look at the S&P/LSTA Leveraged Loan Index, these are below investment grade assets, 20 out of double B, single B, some triple Cs, 30 out of 33 years of positive total return. The future could be different. Two of those negative years were less than, I think, were less than 1% as well. It was just 2008. That was the bad year. It has a funny habit of working out with these assets. That's because you have growth-oriented companies. You've got growth-oriented sponsors backing them. I'll make an analogy versus real estate. If you owned an office, a Class B office building, west of 7th Avenue in Manhattan, and your rent is due, your mortgage is due, and you've got a 0.8 debt service coverage ratio, kind of nothing you can do with it unless you want to write a fat check. You're kind of out of luck. No company in the history of companies, to my knowledge, I'm saying that a little tongue in cheek, oh, we've got the 0.99 debt service coverage. Let's hand over the keys and head home. No, you sell the overseas division, you lay off 10% of your staff, you go borrow money from some mercenary mezz lender at 15%. You do whatever you do to keep fighting. You've got a lot more levers to pull in a company than you do in an office building, let's say. While companies will default, and some company, you know, a couple of companies I think have defaulted multiple times, the same company multiple times since Eagle Point has existed, by and large, betting against this sector of American companies, this profile has been the wrong idea for an extended period of time. Are people backing off right now? Are they a little hesitant on capital allocation? Absolutely. Is there a multiplier effect on the economy from CapEx? Absolutely. We're going to lose some of that. I don't know of any company saying, they might be pulling in the reins, but I can't think of anyone saying, let's throw in the towel, if that makes sense. There's a perception where someone could, and you know, wait, you guys are 10 times levered to loans. Loans are going to be bad. Maybe I should exit. Maybe I should even short it. I don't know how much short interest there is, but I see there's a fair bit of that. I imagine there's a fair bit of that going on. It's a good day today on the screen. Looking right now, the opposite direction is certainly happening. Yeah. What was interesting with the recent sell-off is that, you know, CLO ETFs, even the ones investing in mezzanine debt, didn't see much of the drawdown, whereas closed-end funds investing in equity or debt saw a significant drawdown. I wonder if there are some concerns about the underlying capital structure. Yeah. I mean, now some of it, a number of the closed-end funds, including us, for quite an extended period of time, ECC generically for the last decade has been at a 10% premium to NAV. That's pretty good. Right now we are at a little bit of a discount to NAV, but closing here by the minute, something else we watch carefully. NAVs were down through the second quarter. Nothing exclusive to ECC. All the CLO equity vehicles that I follow had NAV declines. They have a NAV decline and maybe something that was a premium going to a discount. You kind of have a one-two punch. That said, the message we hear from shareholders is high current income off of these portfolios. Your recurring cash flows cover your distributions and expenses. I think that's the formula people want. People ultimately reward that. I certainly, I believe the stock is undervalued where it is right now, says every CEO in the history of CEOs. I truly do believe it. You look at the cash the portfolio generates and that we're able to share with investors or get investors their cash quickly is something that I think that formula overlaid by loans or a really, really good asset class prevails over time, but not necessarily in every single day. Got it. Thanks a lot for that. I had a second question about loan spread compression. You mentioned that you feel it could be like a bottoming out loan spread. If you look at the metrics that you guys publish every month, stated loan spread on the underlying portfolio declined by about 13 basis points in the first quarter, but only by about 3 basis points in the second quarter. Is that the right metric to look at when we're trying to estimate how much spread compression is being in the portfolio? Yep, that's exactly it. I'll paint an even worse picture. If you look back even two quarters prior, it's like going down a black diamond trail. It stinks. Right. Now you can see from first quarter to second quarter, you know, it's kind of you got to the bottom of the trail. That said, you know, maybe it's just a crosswalk and there's another. Maybe on a bunny hill. Yeah, maybe we're going maybe up on the bunny hill. That said, maybe there's another black ahead that we don't even see yet. That's kind of where it feels like we are right now. A lot of the spread compression that we saw in the second quarter was actually the tail end of repricings announced in the first quarter. In that, let's say a loan reprices, let's say on February 28, it might not trickle through. It might not be for effect until April 15 or something like that. There was not a lot of loan repricing going on in the second quarter. Most of that three or so basis points was attributable to the tail of the first quarter. That said, a leading indicator of spread compression is how many loans, what% of the loan market's trading above par. Once you see more than 40%, 50%, that's just an invitation to go crazy for the bankers who do repricings. That's probably a leading indicator to look at generically. Obviously, it's not definitive, but that's a good leading one. There have been a small number of repricings in the last few weeks as the market's gotten stronger. There have also been a lot of repricings that have been pulled. Those are my favorite emails. I should print them out or something. I think the market's kind of at a steady state right now as a generic statement, not perfectly one way or the other. Obviously, that can change in a moment. I don't think we'll see a big move here in August. People don't usually get too aggressive in August. Let's see what happens in terms of capital availability for investors. What was interesting was that the sales side was saying that July was a very big month for repricings, but the stated loan spread in the portfolio only dropped by 1 basis point. Yeah, it was mostly the lowest spread loans. I want to say one guy, yeah, one loan went from 175 to 150. Most of those that I saw were the tightest, the double Bs tightening a little further. A lot of the single Bs that are the predominance of the CLO portfolios, I certainly saw a lot less activity there. Okay. Thanks for that. That was very helpful. One final question on the collateral manager tie-ins that you have. Are they European collateral managers or U.S. or a combination? I'm sorry. What about the collateral managers? The partnerships that you have. Oh, the joint ventures. They have one is U.S. and one is the original one is U.S. and the new one is European. Okay, perfect. I guess you can't disclose who they are, right? Do we disclose who they are? Let me look at one thing here in the financials. What do we list the... Where do we list that as? Ken and I are going to look through something. Okay. It's got to be in the schedule of investment there, right? I think the U.S. one is well known, right? Because you guys have talked about that before. I think it's Marble Point, right? No, no, no, not Marble Point. That was a former affiliated CLO collateral manager that our advisor owned. That's sold and is now part of InvestCorp. If you look on the schedule of investments on page 21 of the June 30 financials, down at the bottom, you'll see it's Musenich & Co. for the U.S. collateral manager. That's valued at $2.40 million right now. Delightfully, you'll see it has zero cost basis. That's good. I think that number should keep going up, but that's my opinion. They put the press release out already, so it's fine. The European one is Musenich Europe, actually. Oh, okay. All right. Yeah, same formula, same folks. Partnership is going really well. Let's do it again. Got it. Makes sense. Thanks a lot, Tom. Appreciate you taking my questions. Thank you. Thank you very much. Thank you. Ladies and gentlemen, we've come to the end of our time allowed for questions. I'll now turn the floor back to Mr. Majewski for any final comments. Great. Thank you very much. We appreciate everyone's time and questions today and appreciate your continued support for Eagle Point Credit Company. Thank you very much. Thank you. This concludes today's conference call. You may disconnect your lines at this time. Thank you for your participation.