Good morning, and thank you all for attending the Oxford Lane Capital Corp. Announces net asset value and selected financial results for the first fiscal quarter and declaration of distributions on common stock. My name is [ Brika ], and I will be your moderator for today. [Operator Instructions]. I would now like to pass the conference over to your host, Jonathan Cohen, CEO at Oxford Lane Capital Corp. Thank you. You may proceed, Jonathan.

Thank you. Good morning, everyone, and welcome to the Oxford Lane Capital Corp. First Fiscal Quarter 2026 Earnings Conference Call. I'm joined today by Bruce Rubin, our Chief Financial Officer; and Joe Kupka, our Managing Director. Bruce, could you open the call today with the disclosure regarding forward-looking statements?

Sure, Jonathan. Today's call is being recorded. An audio replay of the call will be available for 30 days. Replay information is included in our press release that was issued earlier this morning. Please note that this call is the property of Oxford Lane Capital Corp. Any unauthorized rebroadcast of this call in any form is strictly prohibited. At this point, please direct your attention to the customary disclosure in this morning's press release regarding forward-looking information. Today's conference call includes forward-looking statements and projections that reflect the company's current views with respect to, among other things, future events and financial performance. We ask that you refer to our most recent filings with the SEC for important factors that can cause actual results to differ materially from those indicated in these projections. We do not undertake to update our forward-looking statements unless required to do so by law. During this call, we will use terms defined in the earnings release and also refer to non-GAAP measures. For definitions and reconciliations to GAAP, please refer to our earnings release posted this morning at www.oxfordlanecapital.com. With that, I'll turn the presentation back to Jonathan.

Thanks, Bruce. On June 30, 2025, our net asset value per share stood at $4.12 compared to a net asset value per share of $4.32 as of the previous quarter. For the quarter ended June, we recorded GAAP total investment income of approximately $124 million, representing an increase of approximately $2.8 million from the prior quarter. The quarter's GAAP total investment income consisted of approximately $117.4 million from our CLO equity and CLO warehouse investments and approximately $6.6 million from our CLO debt investments and from other income. Oxford Lane recorded GAAP net investment income of approximately $75.1 million or $0.16 per share for the quarter ended June 30 compared to approximately $75.4 million or $0.18 per share for the quarter ended March 31. Our core net investment income was approximately $112.4 million or $0.24 per share for the quarter ended June compared with approximately $95.8 million or $0.23 per share for the quarter ended March. As of June 30, we held approximately $701.5 million in newly issued or newly acquired CLO equity investments that had not yet made their initial distributions to Oxford Lane. For the quarter ended June, we recorded net unrealized depreciation on investments of approximately $40.2 million and net realized losses of approximately $8.8 million. We had a net increase in net assets resulting from operations of approximately $26.1 million or $0.06 per share for the first fiscal quarter. As of June 30, we note that the following metrics applied. We also note that none of these metrics necessarily represented a total return to shareholders. The weighted average yield of our CLO debt investments at current cost was 16.9%, up from 15.9% as of March 31. The weighted average effective yield of our CLO equity investments at current cost was 14.7%, down from 15.9% as of March 31. The weighted average cash distribution yield of our CLO equity investments at current cost was 21.6%, up from 20.5% as of March 31. We note that the cash distribution yields calculated on our CLO equity investments are based on the cash distributions we received or which we were entitled to receive at each respective period end. During the quarter ended June, we issued a total of approximately 25.8 million shares of our common stock pursuant to an at-the-market offering, resulting in net proceeds of approximately $116.4 million. During the quarter ended June, we made additional CLO investments of approximately $441.8 million, and we received approximately $120.7 million from sales and from repayments. On July 22, our Board of Directors authorized a 1-for-5 reverse stock split and declared monthly common stock distributions of $0.08 per share for each of the months ending October, November and December of 2025. With that, I'll turn the call over to our Managing Director, Joe Kupka.

Thanks, Jonathan. During the quarter ended June 30, 2025, U.S. loan market performance improved versus the prior quarter. U.S. loan price index increased from 96.31% as of March 31 to 97.07% as of June 30. The increase in U.S. loan prices led to an approximate 6-point increase in median U.S. CLO equity net asset values. Additionally, we observed median weighted average spreads across loan pools within CLO portfolios decreased to 327 basis points compared to 330 basis points last quarter. The 12-month trailing default rate for the loan index increased to 1.11% by principal amount at the end of the quarter from 0.82% at the end of March. We note that out-of-court restructurings, exchanges and subpar buybacks, which are not captured in the cited default rate, remain elevated. CLO new issuance for the quarter totaled approximately $51 billion, reflecting an approximate $3 billion increase from the prior quarter, keeping pace with the first half of 2024, a record-breaking year. Additionally, the U.S. CLO market saw approximately $53 billion in reset and refinancing activity in Q2 2025 compared to approximately $105 billion in the previous quarter. Oxford Lane remained active this quarter, investing over $441 million in CLO equity debt and warehouses while participating in opportunistic resets and refinancings. As a function of our overall activity during the quarter, we were able to lengthen the weighted average reinvestment period of Oxford Lane's CLO equity portfolio from November 2028 to January 2029. Our primary investment strategy during the quarter was to engage in relative value trading and seek to lengthen the weighted average reinvestment period of Oxford Lane's CLO equity portfolio. In the current market environment, we intend to continue to utilize our opportunistic and unconstrained CLO investment strategy across U.S. CLO equity debt and warehouses as we look to maximize our long-term total return. And as a permanent capital vehicle, we've historically been able to take a longer-term view towards our investment strategy. With that, I'll turn the call back over to Jonathan.

Thanks very much, Joe. Additional information about Oxford Lane's first fiscal quarter performance has been uploaded to our website at www.oxfordlanecapital.com. And with that, we're happy to open the call, operator, for any questions.

[Operator Instructions]. The first question we have comes from Erik Zwick with Lucid Capital Management.

You indicated that the CLO market continues to remain robust on the issuance side. Wondering if you could just maybe as you scan the market today, looking at both primary and secondary opportunities, give a little commentary into how you're weighing the opportunities for each versus each other?

Erik, yes, I think we're still seeing value in both primary and secondary. It's something we reevaluate every single day just to make sure we're picking the right profiles. Tier 1 long-dated equity has definitely caught a very strong bid. So we still feel comfortable creating that profile in the primary, knowing how strongly it trades in the secondary. And then in the secondary, we've been targeting a bit lower tier managers that trade significantly wider and as well as reset and refinancing opportunities as well.

And then just curious, as you evaluate maybe kind of a 2-part question. One, as the CLO market continues to grow and see strong issuance, are there new managers coming into the market? And how do you evaluate those as well as maybe existing managers that you haven't worked with before and deciding to work with it?

Yes. So generally, we will wait for a manager to kind of at least complete a few deals and evaluate their performance before stepping in. And then we can usually pick up their paper in the secondary of very attractive yields, but it's definitely something we keep a close eye on all the new entrants to the space and kind of new managers.

Right. Most of our primary market activity, though, Erik, and our warehousing activity does tend to be with the largest best regarded Tier 1 managers.

Got it. And then you mentioned in the prepared remarks, I think it was $705 million of new issue CLOs that are on the balance sheet but have yet to make their first cash distribution. Just in terms of expectations, would you expect most of those to make their first payment either in the current quarter of '25 or the final quarter of the year?

Yes. So the majority of those will be in the following quarter, and then they kind of tail off, but there's still a significant amount in the quarter ending 12/31 and then 3/31 the following year.

Right.

And then with regard to the unrealized depreciation that was recorded during the most recently completed quarter, could you just maybe provide a little color in terms of how much of that was market-related versus any specific CLO developments?

No real specific CLO developments to highlight. I would say. There were some short-dated deals that diverted and took a mark-to-market loss. But generally, it's just a function of the mark-to-market of those assets declining as payments come out. So the total return is still positive on those assets, but you just see a slight mark-to-market decline on some assets.

Right. And as you know, Erik, we're focused primarily on total return. So how that total return manifests, whether it's in cash flow, payments we get down the IO waterfall or principal recovery down the PO waterfall or gains that we make by trading in the secondary market, buying in the primary, we are essentially indifferent to the way that we generate the total return, but the total return itself is the objective.

Yes. No, I think that's a good point and your historical returns certainly demonstrate that. I wonder if you could maybe just add a little bit more in terms of how you view your competitive advantage relative to your kind of unconstrained investment philosophy and then how that positions you better versus some of your peers?

Sure, Erik. So as you know, we run essentially a completely unconstrained investment mandate, meaning that we have the ability and the mandate and the capability of participating in the warehouses, participating in the primary market, which we do on a very large scale, participating on a particularly large scale in the secondary market. We own Tier 1 managed deals, Tier 2 managed deals, some Tier 3 managed deals, deals that are in -- well within their reinvestment periods, deals that are outside of the reinvestment period. I think it is that breadth to our portfolio in terms of the various profiles that we're willing to engage in that has been particularly beneficial to us over a long period of time.

And one final one for me, and I'll step aside. It seems like the economic data that we continue to see here in the U.S. continues to be positive. There's still a lot of uncertainty, I guess, from your seat, from what you're able to see as you continue to look into your existing CLO portfolio as well as new opportunities. Anything on the horizon as to the ability that you can see that gives you any pause or concern with regard to the kind of future performance?

Nothing specific, Erik. I mean, as you know, CLOs are essentially pools of U.S. syndicated corporate loans, large pools, roughly about $0.5 billion of fees, consisting of highly diversified collateral pools of U.S. syndicated corporates. Those corporate loans are obviously issued by larger U.S. corporations. So to some significant extent, the success of this asset class is tied to the performance of the U.S. economy, the global economy and the performance of U.S. corporations. There are lots and lots of offsets to that dynamic and to that construct by virtue of the architecture of these CLO structures. But at the end of the day, we are investing in U.S. corporations. So the success of the U.S. economy, the success of the U.S. corporate sector, those are clearly important elements.

I can confirm that does conclude our question-and-answer session. And I'd like to turn it back to our CEO, Mr. Cohen, for some final closing comments.

Thank you. I'd like to thank everybody who's participated in this call or who's listening in the replay for their interest in Oxford Lane, and we look forward to speaking to you in the future. Thanks very much.

Thank you. I can confirm that does conclude today's conference call with Oxford Lane Capital Corp. Thank you all for your participation. Enjoy the rest of your day, and you may now disconnect.