Advanced Flower Capital Inc.

Good day and thank you for standing by. Welcome to the ASC second quarter 2026 earnings conference call. At this time, all participants are in a listen-only mode. After the speaker's presentation, there will be a question and answer session. To ask a question during the session, please press star 1-1 on your telephone. You will then hear an automated message advising your hand is raised. To withdraw your question, please press star 1-1 again. Please be advised that today's conference is being recorded. I would now like to hand the conference over to your speaker today, Gabriel Katz, Chief Legal Officer. Sir, please go ahead.

Good morning and thank you all for joining AFC's earnings call for the quarter ended June 30th, 2026. I'm joined this morning by Robyn Tannenbaum, our President and Chief Investment Officer, Daniel Neville, our Chief Executive Officer, and Brandon Hetzel, our Chief Financial Officer. Before we begin, I would like to note that this call is being recorded. Replay information is included in our July 17, 2026 press release and is posted on the investor relations portion of AFC's website at afcbdc.com, along with our second quarter 2026 earnings release and investor presentations. Today's conference call includes forward-looking statements and projections that reflect the company's current views with respect to, among other things, market developments, anticipated portfolio yield and financial performance, and projections in 2026 and beyond. These statements are subject to inherent uncertainties in predicting future results. Please refer to AFC's most recent periodic filings with the SEC, including our quarterly report on Form 10-Q filed earlier this morning for certain conditions and significant factors that could cause actual results to differ materially from these forward-looking statements and projections. Today's call will begin with Robyn providing an overview of the lending environment and our results. Dan will then provide an update on our portfolio and pipeline. Finally, Brandon will conclude with a summary of our financial results before we open the line for Q&A. With that, I will now turn the call over to our President and Chief Investment Officer, Robyn Tannenbaum.

Thanks, Gabe, and good morning, everyone. We appreciate you joining us to discuss AFC's second quarter 2026 earnings. Before turning to our results, I want to provide some context on the broader lending environment. As many of you know, the private credit ecosystem is experiencing stress. Default rates across private credit have risen notably, with Fitch reporting a 6% default rate as of July 2026, and Proskauer's private credit default index tracking a similar upward trend. Banks, while not direct lenders to much of the middle market, hold indirect exposure through leveraged facilities extended to private credit funds, and that exposure is now drawing increased scrutiny. In response to broader market stress, we are seeing a pullback in available capital, particularly in the lower middle market where many lenders have either exited or shifted up market to support their existing portfolios. As a result, we continue to believe the lower middle market offers one of the most compelling risk-adjusted return investment opportunities in private credit today. Competition remains rational in our segment. Unlike the upper middle market where larger direct lending funds continue to compete aggressively on pricing, leverage, and documentation, the lower middle market continues to reward lenders with sponsor relationships, internal sourcing capabilities, and the ability to execute quickly. For AFC, this environment is exciting and what we are prepared for. We believe this dislocation is creating a compelling vintage for new originations. The loans we originate are generally supported by both enterprise value and asset coverage. We continue to negotiate comprehensive maintenance covenant packages, including leverage and fixed charge coverage tests. Our pipeline continues to reflect that opportunity, and we are being thoughtful in how we deploy capital. In contrast, Much of the upper middle market remains characterized by covenant-like structures with fewer lender protections and more aggressive EBITDA adjustments. Now, turning to our results. For the second quarter of 2026, AFC generated net investment income of 15 cents per weighted average share of common stock. Additionally, the Board of Directors declared a second quarter distribution of 5 cents per share, which was paid on July 15, 2026, to shareholders of record on June 30th, 2026. Last quarter, we announced a share repurchase program. During the quarter, we repurchased about $2.8 million, which was 17 cents accretive to net asset value. We have approximately $2.2 million remaining in our $5 million share buyback program. Year to date, we have deployed approximately $102 million in new lower middle market commitments Our pipeline remains well diversified across industries, and we tend to avoid sectors where we believe cyclicality or disruption creates an unfavorable risk profile. I will now turn it over to Dan to discuss our portfolio.