SWK Holdings Corporation

Greetings. Welcome to the SWK Holdings Second Quarter 2025 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. Please note this conference is being recorded. I will now turn the conference over to your host, Susan Zhu, Investor Relations. You may begin.

Good morning, everyone, and thank you for joining SWK Holdings' second quarter 2025 financial and corporate results call. Yesterday, SWK Holdings issued a press release detailing its financial results for the three months ended June 30th, 2025. The press release can be found in the investor relations section of swkhold.com under news releases. Today, we will be making certain forward-looking statements about future expectations and plans, events, and circumstances, including statements about our strategy, future operations, and our expectations regarding our capital allocation and cash resources. These statements are based on our current expectations, and you should not place undue reliance on these statements. Actual results may differ materially due to our risks and uncertainties, including those detailed in the risk factors section of SABK Holdings 10-K, filed with the SEC, and other filings we make with the SEC from time to time. SWK Holdings disclaims any obligation to update information contained in these forward-looking statements, whether as a result of new information, future events, or otherwise. Joining me from SWK Holdings on today's call is Jody Staggs, President and CEO, and Adam Rice, CFO, who will provide an update on SWK's second quarter 2025 corporate and financial results. Over to you, Jody.

Thank you, Susan, and thank you, everyone, for joining our second quarter conference call. Since we last spoke, SWK has worked to reconcile the gap between how the market prices our assets and our view of the underlying value. During the second quarter, we completed a sale of the majority of our royalty assets, and after quarter closed, we completed a sale of the majority of the assets at our Mod 3 subsidiary. The sale of these assets was completed for approximately book value a premium to where STPK has historically traded. During the quarter, STPK returned $49 million of the proceeds of these sales to shareholders through a $4 per share dividend. Additionally, year to date, STPK has returned an additional $3 million of capital to shareholders through the repurchase of approximately 200,000 shares of our common stock. We believe these steps demonstrate the organization's focus on realizing the underlying value of our assets and ensuring that shareholders benefit from these realizations. These actions have simplified our business, and SWK's remaining financial assets are cash, $234 million of gross performing first lien term loans with an effective yield of 14.1%, $12 million of gross non-performing reorg royalties, $5 million of public equities warrants, and approximately 11 private warrants and earnouts, which are carried at $0 for GAAP purposes. Against these assets, we carry an $8.8 million general loan loss reserve. For the second quarter, both our non-GAAP adjusted net income and finance segment adjusted non-GAAP net income totaled $4.6 million. We believe this level is a reasonable run rate for the business going forward. Our non-GAAP tangible financing book value per share totaled $18.47, a year-over-year increase of 11.7% after considering the $4 per share special dividend and achieving our stated goal of 10% plus book value per share growth. On July 15th, the APTAR group exercised its option to acquire the majority of the Mod 3 assets for a predetermined purchase price totaling $6.9 million. which includes the $3.3 million of payments SWK had already received. We view this as a successful outcome and in the best interest of SWK shareholders, our former Mod 3 colleagues, and APTAR. We wish Paul and the team the best and look forward to following their success under the APTAR banner. With that, I will turn the call to our CFO, Adam Rice, to review the quarter's financial results.