SuRo Capital Corp Stock

Welcome to the Neostellar Capital's Second Quarter 2026 Earnings Call. My name is Paul, and I will be your coordinator for today's event. Please note this call is being recorded. [Operator Instructions]

I will now hand you over to your host, Willy Lee, to begin today's conference. Thank you.

Thank you. Thank you for joining us on today's call. I'm joined today by Chairman and Chief Executive Officer of Neostellar Capital, Mark Klein; and Chief Financial Officer, Allison Green.

Please note that a slide presentation corresponding to today's prepared remarks by management is available on our website at neostellar.vc under Investor Relations, Events and Presentations. Today's call is being recorded and broadcast live on our website, neostellar.vc. Replay information is included in our press release issued today. This call is property of Neostellar Capital and the unauthorized reproduction of this call in any form is strictly prohibited.

I would also like to call your attention to customary disclosures in today's earnings press release regarding forward-looking information. Statements made in today's conference call and webcast may constitute forward-looking statements, which relate to future events or our future performance or financial condition. These statements are not guarantees of our future performance, condition or results and involve a number of risks, estimates and uncertainties, including the impact of any market volatility that may be detrimental to our business, our portfolio companies, our industry and the global economy that could cause actual results to differ materially from the plans, intentions and expectations reflected in or suggested by the forward-looking statements.

Actual results may differ materially from those in the forward-looking statements as a result of a number of factors, including, but not limited to, those described from time to time in the company's filings with the SEC. To obtain copies of Neostellar Capital's latest SEC filings, please visit our website at neostellar.vc or the SEC's website at sec.gov.

Now I would like to turn the call over to Mark Klein.

Thank you, Willy. Good afternoon, everyone, and thank you for joining us. Today marks an important moment for our company. This is our first earnings call as Neostellar Capital. For more than 15 years, our team has pursued a clear mission, to provide public market investors with access to high-growth venture-backed private companies before those businesses become directly available in the public markets.

Neostellar represents the next chapter of that mission. Our investment strategy has changed. The team responsible for the portfolio remains in place. What has changed is the breadth of resources, expertise and capabilities supporting our strategy, and we believe that meaningfully strengthens our ability to create long-term value for stockholders.

Following stockholder approval, our transition to an externally managed structure became effective on July 15. On July 21, our team and Magnetar formally announced the launch of Neostellar Advisors. This evolution comes at a pivotal time for the private markets. Companies are staying private longer. They are raising more capital, and they are increasingly seeking financing solutions that extend beyond traditional equity.

Neostellar Advisors brings together our team's 15-year history of investing in venture-backed private companies with Magnetar's institutional capabilities across credit, structured capital, technology and AI infrastructure. That combination gives us broader resources for sourcing and underwriting as well as greater flexibility to evaluate structured investments. We believe it expands the opportunity set available to Neostellar, while preserving what has always distinguished our approach, the same core investment team, the same public company structure and the same commitment to disciplined underwriting.

Following quarter's end, a Magnetar affiliated entity invested $20 million in Neostellar. We view that investment as a meaningful expression of Magnetar's commitment to Neostellar and confidence in the opportunity ahead.

With that context, let me turn to our second quarter results and investment activity. We ended the second quarter with net assets of approximately $356 million or $13.44 per share compared with $14.24 per share at March 31 and $9.18 a share a year ago.

Our principal investment activity during the quarter centered on 2 companies: TensorWave and ClickHouse. We funded the remaining $15 million of our $20 million commitment to Magnetar Opportunity 2025-4 LP, a special purpose vehicle investing in TensorWave. We also invested approximately $9.5 million in ClickHouse. Before discussing those investments, I want to place them in the context of the broader AI infrastructure market and the disciplined approach guiding our capital allocation.

AI is rapidly establishing itself as a foundational technology layer across the global economy. It remains a major investment theme for our team, building on several years of experience across the sector. Our portfolio already includes investments in OpenAI, CoreWeave, VAST Data and Canva. Together, those holdings provide exposure to and insight across multiple layers of the AI ecosystem, including model development, compute, data infrastructure and AI-enabled applications.

TensorWave and ClickHouse extend the exposure into specialized compute capacity and real-time data infrastructure. The pace of development continues to accelerate. When we made our initial investment in OpenAI, ChatGPT had approximately 200 million weekly active users. Today, OpenAI reports more than 900 million weekly active users. Over that period, model capabilities have advanced and adoption has broadened across consumers and enterprises. We are seeing that adoption translate into greater usage, more commercial deployments and significant capital commitments to the infrastructure required to support them.

The scale of this investment cycle is reflected in the capital plans of the world's leading technology companies. Combined capital expenditures across Alphabet, Amazon, Meta, Microsoft and Oracle were approximately $154 billion in 2023, $239 billion in 2024. And in comparison, Morgan Stanley Research estimates that capital expenditures by the 5 largest U.S. technology companies will approach $800 billion in 2026 and approximately $1.2 trillion in 2027.

As AI becomes more deeply embedded across industries and business workflows, we expect demand for the supporting infrastructure to continue expanding. That includes compute capacity, data and networking infrastructure, cybersecurity and power. We are excited about the long-term potential of AI, but enthusiasm is not a substitute for discipline. Valuations have risen, competition has intensified and growth expectations have become very ambitious. In this environment, selectivity matters more, not less.

We evaluate each opportunity on its own merits, including company execution, entry price, transaction structure and downside risk. We are not seeking to assemble a passive basket of the largest or best known private companies. Our objective is to identify exceptional businesses early and invest on the terms that we believe appropriately balance risk and return.

Our investment in TensorWave exemplifies this discipline. During the second quarter, we funded the remaining $15 million of our $20 million commitment through a Magnetar special purpose vehicle in connection with TensorWave's $350 million Series B financing co-led by Magnetar and AMD Ventures. This investment fulfilled the commitment we initially made at year-end and increased Neostellar's exposure to one of the most strategically important segments of the AI infrastructure market.

Importantly, the stage structure allowed us to increase our exposure as the company executed rather than committing the full amount at once. In a highly competitive market for private AI investments, we believe this measured approach preserved access to an attractive opportunity, while reinforcing our risk discipline.

TensorWave is building an AI cloud around AMD's ecosystem with the goal of providing specialized compute capacity for increasingly demanding AI training and inference workloads. Given that focus, we are particularly encouraged by AMD Ventures' participation as a co-lead investor in the financing. We believe TensorWave is well positioned as the AI compute market expands and customers seek additional sources of high-performance capacity, greater flexibility and a more diversified hardware ecosystem.

The investment also demonstrates the practical value of the Neostellar and Magnetar relationship. It combines our experience investing in private growth companies with Magnetar's AI infrastructure capabilities and transaction structuring expertise.

Turning to ClickHouse. We invested $9.5 million in the company's Series A preferred shares through a secondary transaction in April. ClickHouse gives us exposure to an increasingly essential infrastructure category through what we believe is a category-leading company that has already achieved meaningful commercial scale.

At its core, ClickHouse enables companies to analyze massive volumes of data quickly and in real time. That capability becomes increasingly important as AI and other data-intensive applications move from experimentation into production. These systems generate enormous amounts of operational data. Enterprises need to analyze that information in real time to monitor performance, identify issues, improve products and make decisions faster. ClickHouse was purpose-built for that environment.

The company reports that its cloud offering has surpassed $250 million in annual run rate revenue, more than tripling from a year earlier. It has also added more than 1,000 net new customers since January, bringing its total customer base to approximately 4,000. ClickHouse is already operating at a meaningful scale. We believe continued demand for real-time analytics and observability can support further growth across AI and broader enterprise workloads.

Let me close with a few thoughts. The second quarter and the weeks immediately following it marked a defining period for our company. We made significant investments in TensorWave and ClickHouse. We completed our transition to an externally managed structure, and we began operating under the Neostellar name. The launch of Neostellar reflects the evolution of both private markets and our platform. Companies are remaining private longer. Their financing needs are becoming more sophisticated and competing effectively for stockholders requires us to think not only about which investments we make, but also about how we access, underwrite and structure those opportunities.

By combining our team's long history of investing in venture-backed private companies with Magnetar's institutional capabilities, we believe Neostellar is better positioned to identify compelling opportunities, structure investments with discipline and support portfolio companies as they grow.

Put simply, Neostellar expands what we can do. It does not change how we invest. We have always believed that attractive long-term returns begin with disciplined underwriting, thoughtful portfolio construction and patience. Those principles remain the foundation of our approach. We will continue to pursue opportunities where our experience, access or structuring capabilities can create a genuine advantage. We will remain selective. We will stay focused on risk-adjusted returns, and we will allocate capital with the same discipline our stockholders have come to expect of us.

We are energized by this next chapter and confident in the platform we are building. Most importantly, we remain fully aligned with our stockholders and committed to create durable long-term value.

Thank you for your continued support. I would now like to turn the call over to Allison Green to review our financial results in greater detail.

Thank you, Mark. I'd like to follow Mark's update with a review of our investment activity and portfolio company realizations during the second quarter and subsequent to quarter end, a high-level review of our investment portfolio as of quarter end, including the investment theme breakdown and a more detailed review of our second quarter financial results, including our current liquidity as of June 30. I'll also touch on notable items during the second quarter and subsequent to quarter end, including the effectiveness of our externalization and the receipt of $20 million under the redeemable promissory note issued to a Magnetar affiliate.

On December 31, we committed up to $20 million to Magnetar Opportunity 2025-4 LP, a special purpose vehicle invested in TensorWave, Inc. We funded the initial $5 million tranche on January 2, 2026, and the remaining $15 million tranche on June 3. We are invested in TensorWave, Inc.'s Series B preferred shares via our investments in the Class A interest and Class B interest of Magnetar Opportunity 2025-4 LP. As of June 30, our $20 million commitment to Magnetar Opportunity 2025-4 LP has been fully funded.

During the quarter, we also invested approximately $225,000 in Huntress Labs common shares and $9.5 million in ClickHouse Series A preferred shares, both through secondary transactions, not inclusive of capitalized fees. Throughout the second quarter, we received 4 distributions from CW Opportunity 2 LP totaling approximately $6.5 million in net proceeds. CW Opportunity 2 LP is a special purpose vehicle for which the Class A interest is solely invested in the Class A common shares of CoreWeave, Inc.

We are invested in the Class A common shares of CoreWeave through our investment in the Class A interest of CW Opportunity 2 LP. The distributions were categorized in aggregate as approximately $1.9 million return of capital and a $4.6 million realized gain. The aggregate distribution represented approximately 12.2% of our $15 million initial investment in CW Opportunity 2 LP. The distributions received to date represent approximately 44.1% of the initial investment. As of quarter end, we continue to have exposure to CoreWeave through our remaining investment in CW Opportunity 2 LP.

Additionally, during the quarter, we sold 147,135 common shares of GrabAGun Digital Holdings, Inc. These sales resulted in net proceeds of approximately $467,000 and a realized gain of approximately $311,000. As of June 30, we hold 452,619 public common shares or approximately 44% of our original position.

Finally, during the quarter, we received a $5.2 million distribution, reflecting a full exit from our investment in HL Digital Assets, Inc., resulting in a realized gain of approximately $45,000. Subsequent to quarter end, on July 10, we exercised 86,076 common warrants of Shogun Enterprises, Inc. doing business with Hearth, acquiring 86,076 shares of Class A common stock for an aggregate exercise price of approximately $861.

Additionally, subsequent to quarter end through today, we sold 143,655 shares of GrabAGun Digital Holdings, Inc. at an average net price per share of $3.12. These sales resulted in net proceeds of approximately $448,000 and a realized gain of approximately $295,000. As of today, we hold 308,964 remaining common shares or 30% of our original position.

I would now like to turn to our portfolio as of quarter end. Our top 5 positions as of June 30 were Whoop, OpenAI, VAST Data, TensorWave and Blink Health. These positions accounted for approximately 69% of the investment portfolio at fair value. Additionally, as of June 30, our top 10 positions accounted for approximately 86% of the investment portfolio.

Segmented by 7 general investment themes, the top allocation of our investment portfolio at June 30 was to consumer goods and services, representing approximately 41% of the portfolio at fair value. Artificial intelligence infrastructure and applications and Software-as-a-Service were the next largest categories with approximately 34% and 10% of our portfolio, respectively. Approximately 6% of our portfolio was invested in education technology companies and the Logistics and Supply Chain segment accounted for approximately 4% of the fair value of our portfolio. The financial technology and services category also accounted for approximately 4% of the fair value of our portfolio and SuRo Sports accounted for 2% as of June 30.

We ended the second quarter of 2026 with a net asset value of approximately $355.9 million or $13.44 per share, which is consistent with our financial reporting. The decrease in NAV per share from $14.24 at the end of Q1 2026 was primarily driven by an $0.88 per share decrease due to net investment loss, which includes approximately $20 million of accelerated and nonrecurring expenses incurred in connection to the externalization, a $0.29 per share decrease related to the issuance of common shares from the partial conversions of our 6.5% convertible notes due 2029 and a $0.02 per share decrease from the net change in unrealized depreciation of our investments during the quarter.

The decrease in NAV per share was offset by a $0.20 per share increase related to stock-based compensation, net of share withholding settlements and a $0.19 per share increase resulting from net realized gains from portfolio investments during the quarter. At June 30, there were 26,473,222 shares of the company's common stock outstanding.

Finally, regarding our liquidity as of quarter end. We ended the quarter with approximately $14.6 million of liquid assets, including approximately $12.9 million in cash and approximately $1.7 million in unrestricted public securities. Not included in our unrestricted public securities are approximately $15.4 million of public securities subject to lockup or other sales restrictions as of quarter end. This represents our remaining investment in CoreWeave via our Class A interest of CW Opportunity 2 LP.

During the quarter, the purchaser of the 6.5% convertible notes due 2029 elected to exercise their conversion option on multiple occasions and converted an aggregate of $8 million of the $35 million principal amount of convertible notes into 1,092,504 shares of the company's common stock and cash and fractional shares. Upon completion of these conversions, the remaining principal balance of the 6.5% convertible notes due 2029 was approximately $27 million at year end.

As Mark mentioned, on April 2, our Board of Directors, including all of our independent directors, unanimously approved the company's transition from an internally managed BDC to an externally managed structure through an investment advisory agreement with Neostellar Advisors LLC, an entity jointly owned by certain members of the former SuRo Capital Management team and Magnetar Holdings LLC, an affiliate of Magnetar's multi-strategy alternative investment platform.

Following stockholder approval on June 10, the externalization became effective July 15, 2026, and Neostellar Advisors became the company's investment adviser. The company continues to trade on the Nasdaq Global Select Market under the ticker symbol NSLR and continues to be led by Mark Klein, Chairman, President and Chief Executive Officer; and myself as Chief Financial Officer, Treasurer and Corporate Secretary. In addition, Eric Falk, Partner and Head of Strategy at Magnetar, joined our Board of Directors in connection with the externalization.

Subsequent to quarter end on July 17, we received $20 million in gross proceeds from the issuance of a redeemable promissory note to a Magnetar-affiliated entity. The redeemable promissory note bears interest at 6.5% per year, has a 3-year maturity and is mandatorily redeemable through the issuance of our common stock upon the completion of a qualifying equity financing, resulting in the issuance of at least $230 million of common equity. Additional details are set forth in the company's current report on Form 8-K filed with the Securities and Exchange Commission on July 21.

That concludes my comments. We would like to thank you for your interest and support of Neostellar Capital.

Now I will turn the call over to the operator to start the Q&A session. Operator?

[Operator Instructions] And we will take our first question from Alex Fuhrman of Lucid Capital Markets.

Congratulations on the business transformation here. I wanted to ask about your investment in Whoop. It's obviously been tremendously successful, a large portion of your portfolio at this point. Can you give us a sense best you can now, what the strategy is going to be for that investment? When the IPO might happen? And what your monetization time line could look like there?

Sure. And thank you. Look, we're very fortunate of where Whoop is right now. We invested $11 million, and it's worth considerably more. So in some ways, a little bit a victim of our own success in the sense that it has become a large part of our portfolio.

I think you will note, if those who are following the company, the series of announcements that they have made in hiring very high-level folks and some of the other business initiatives, they've actually been extremely active. I think as you see the health and wellness market continue to grow, we've seen that Oura, the smart ring maker has filed confidentiality about 2 months ago to go public. I think how they move through the public markets is going to be extremely instructive to all. I think it will be very, very well received.

And I think Whoop, at least in the past, has been somewhere between a quarter or 2 quarters behind Oura in their fundraising efforts. So I suspect that Whoop has said this publicly that their intention is to go public. And all else being equal, I suspect they will try to do that at some time next year.

There are no further questions on the line. So I will now hand you back to your host, Mark Klein, for closing remarks.

Thank you all for attending our call today. It is an extremely exciting time for us. The transformation and partnership with Magnetar is something that we are really, really excited about. There is a lot of great things going on in our portfolio and a lot of interesting things for us to do. So we greatly appreciate your time and support. Thank you.

Thank you for joining today's call. You may now disconnect.

Welcome to the SuRo Capital's First Quarter 2026 Earnings Call. My name is Ellen, and I will be your coordinator for today's event. Please note this call is being recorded. [Operator Instructions] I will now hand you over to your host, Evan Schlossman, to begin today's conference.

Thank you for joining us on today's call. I am joined by the Chairman and Chief Executive Officer at SuRo Capital, Mark Klein; and Chief Financial Officer, Allison Green. Please note that a slide presentation corresponding to today's prepared remarks by management is available on our website at www.surocap.com under Investor Relations, Events and Presentations. Today's call is being recorded and broadcast live on our website, www.surocap.com. Replay information is included in our press release issued today. This call is the property of SuRo Capital, and the reproduction of this call in any form is strictly prohibited.

I would also like to call your attention to customary disclosures in today's earnings press release regarding forward-looking information. Statements made in today's conference call and webcast may constitute forward-looking statements, which relate to future events or our future performance or financial condition. These statements are not guarantees of our future performance, or future financial condition or results and involve a number of risks, estimates and uncertainties, including the impact of any market volatility that may be detrimental to our business, our portfolio companies, our industry and the global economy that could cause actual results to differ materially from the plans, intentions and expectations reflected in or suggested by the forward-looking statements. Actual results may differ materially from those in the forward-looking statements as a result of a number of factors, including, but not limited to, those described from time to time in the company's filings with the SEC. With respect to the externalization, these risks and uncertainties include, but are not limited to, the ability to obtain the required stockholder approval, the ability to retain key personnel, the ability to realize anticipated benefits of the externalization and the impact of the externalization on the company's business, financial condition and results of operations. Management does not undertake to update its forward-looking statements unless required to do so by law.

To obtain copies of SuRo Capital's filings, please visit our website at www.surocap.com or the SEC website at sec.gov. Now I'd like to turn the call over to Mark Klein.

Thank you, Evan. Good afternoon, everyone, and thank you for joining us. This is a defining moment for SuRo Capital. Our strong performance in 2025 carried directly into the first quarter of 2026. For the quarter, our net asset value increased from $8.09 per share to $14.24 per share. That is a $6.15 per share increase or approximately 76% quarter-over-quarter. This is the largest quarter-over-quarter NAV increase in our history. This increase reflects the strength of our portfolio and the quality of the companies we have invested in. It also reinforces the strategy we have followed for more than a decade, giving public market investors access to high-growth venture-backed private companies that are otherwise difficult to access.

We believe this access is especially valuable when it is paired with selectivity, identifying important private companies before they're strategic is broadly reflected in public market awareness. At the same time, NAV is a point-in-time measurement. It does not, by itself, capture the full opportunity we believe remains ahead. The larger story is what is in front of us as our portfolio companies continue to mature, scale their businesses and move toward potential liquidity events.

Several recent financings illustrate the larger story. WHOOP recently announced a $575 million Series G financing at a $10.1 billion valuation. The company reported that 2.5 million members globally, 103% year-over-year bookings growth in 2025, a $1.1 billion exit run rate and positive operating cash flow in 2025. For us, WHOOP sits within a broader shift towards health, longevity and actionable self-knowledge. As the category evolves, we believe WHOOP can benefit from AI's ability to convert personal data into more useful individualized guidance for users.

OpenAI closed its latest financing round with $122 billion in committed capital at an $852 billion post-money valuation. This financing speaks to the scale of capital formation around artificial intelligence. AI is no longer a narrow software category. It is becoming a foundational technology layer across compute, data centers, enterprise software, developer tools, healthcare, education and productivity.

VAST Data was valued at $30 billion in its recent Series F financing, more than tripling its prior $9.1 billion valuation from 2023. The round included approximately $1 billion of primary and secondary capital and reflects continued demand for infrastructure supporting artificial intelligence, including data centers and high-performance computing.

Canva launched an employee stock sale at a reported $42 billion valuation, led by existing shareholder, Fidelity, with JPMorgan Asset Management joining as a new investor. The transaction came as Canva continued investing in AI tools for its more than 265 million monthly active users.

Taken together, these are not isolated events. They tell a consistent story. Private market capital is concentrating around scaled private companies with durable growth, strategic relevance and credible path to liquidity. These financings are significant not only for their scale, but for what they signal. Private market capital continues to validate the companies and infrastructure layers that we believe are becoming increasingly important to the next phase of technology.

Our objective is to build exposure to those opportunities with discipline before they are broadly available.

We are not simply observing this market. We continue to participate in it. Recent hyperscaler results continue to reinforce the scale of demand behind AI infrastructure.

The next phase of AI growth depends not only on models and applications, but also on the compute capacity, power, data center infrastructure and specialized systems required to support them. During the quarter, we funded $5 million to a Magnetar special purpose vehicle invested in TensorWave. This investment was part of a commitment of up to $20 million. The remaining commitment of up to $15 million is subject to the satisfaction of certain conditions, including company-level operational milestones.

TensorWave fits within our broader investment strategy and further expands our exposure to AI infrastructure. We view it as the type of opportunity we seek to identify before it becomes more broadly familiar to the broad investor base. The company is positioned around a significant technology shift with meaningful room to scale in part of the market where demand for performance, capacity and specialized infrastructure remains structurally important. That approach is consistent with the discipline we applied in building our exposure to CoreWeave, where we sought exposure to an important infrastructure company before its role in the AI ecosystem was more broadly recognized. We also believe the stage structure gave us a measured way to increase exposure to TensorWave within a framework tied to execution.

More broadly, we intend to remain disciplined in how we deploy capital while being decisive when we see opportunities aligned with our strategy and with areas we believe long-term value is being created.

This participation continued after year-end. Following quarter's end, we made a new investment of approximately $10 million in ClickHouse, a company we believe is well positioned at the intersection of data infrastructure, artificial intelligence and real-time analytics. ClickHouse helps enterprises query, analyze and act on massive volumes of data quickly and efficiently, a capability that is becoming increasingly important across observability, security analytics, product telemetry, cloud data warehousing and AI-driven applications. This matters because as AI moves from experimentation to deployed enterprise use cases, the infrastructure required to store, analyze and act on data at scale becomes increasingly critical.

ClickHouse's relevance is already visible in demanding AI environments, including Anthropic, which ClickHouse has publicly described as using its technology to scale observability for all AI workloads. ClickHouse is another example of the kind of company we seek to invest in. It is already a scaled venture-backed technology leader, but we believe its strategic relevance is becoming greater as real-time data infrastructure becomes more important to enterprise AI deployment. For SuRo, the opportunity is to build exposure while companies like this remain private.

Because this investment was made after the quarter's end, it is not part of our March 31 net asset value. It is, however, an important example of how we intend to build the future portfolio.

Now I want to turn to what we believe is one of the most important strategic steps in SuRo Capital's history. Our Board of Directors approved a proposal to transition SuRo from an internally managed BDC to an externally managed structure through Neostellar Advisors LLC, an adviser jointly owned by members of our current team and Magnetar. The proposal remains subject to stockholder approval. This is not a sale of the company. The company will continue to be a publicly traded BDC, and our investment focus will remain centered on high-growth, venture-backed private companies. While the core strategy will remain the same, we believe the proposed structure will enhance the platform, supporting the strategy and better positioning us to pursue high-quality investment opportunities. Since 2019, our internally managed structure has served us well. Our team has built the portfolio, navigated volatile markets, returned significant capital to stockholders and delivered meaningful value.

The NAV increase this quarter is evidence of that work. At the same time, the market has evolved. Leading private companies have more choices today, and they increasingly look for investors who can bring more than capital, including scale, relationships, strategic support, capital markets experience and a long-term partnership. We believe the proposed partnership with Magnetar positions us to compete more effectively in this environment. Magnetar brings significant scale with approximately $18 billion in assets under management, more than 20 years of investment experience and a track record of investing in differentiated technology, venture-backed companies across artificial intelligence and technology-enabled sectors.

The strategic logic is straightforward. We are preserving the investment strategy and leadership continuity that brought us to this point while adding Magnetar scale, sourcing reach, diligence capabilities, portfolio support and institutional infrastructure. In addition, Magnetar's experience across the AI infrastructure ecosystem gives us additional depth in one of our core focus areas and in a market we believe will be increasingly important to broader technology growth.

As many of these businesses become more capital-intensive, Magnetar's experience with cost of capital, balance sheet management and transaction structuring becomes even more relevant. We also expect the proposed structure to strengthen our origination and diligence capabilities while creating a broader platform to support portfolio companies. Put simply, we believe this gives us greater scale, broader capital solutions and deeper institutional capabilities to support private companies as they grow.

If approved by stockholders, we believe this combination would position us to be one of the largest platforms focused on publicly traded access to venture-backed private companies.

Public venture capital has historically been a fragmented market, and we believe greater scale, stronger infrastructure and deeper sourcing capability can matter in competing for high-quality private company investments. This would be a significant change and positive for us in our competitive position. For stockholders and portfolio companies, we believe the benefit would be a broader platform, deeper resources and a stronger ability to support ambitious private companies building in large markets.

I want to speak directly about shareholder alignment. Being shareholder-friendly is not just a slogan for us. It is how we evaluate major decisions. The value created in the existing portfolio belongs to our shareholders. Under the proposed advisory agreement, pre-existing investments are not included in the incentive fee calculation. In plain English, the value already created in this portfolio is preserved for stockholders and is not subject to a new incentive fee simply because we are changing the management structure. We believe this is an important and stockholder-friendly feature.

Additionally, subject to the conditions described in the proxy materials, an affiliate of Magnetar is also expected to invest $20 million in our company. We believe this is a meaningful signal of commitment and alignment.

Magnetar and the Board think like owners because we are owners. Our goal is not simply to report a higher NAV. Our goal is to convert portfolio value into long-term stockholder value. This means disciplined investing, thoughtful liquidity management, expense discipline, transparency and continued focus on returning value to our stockholders.

Let me close with this. This is one of the most important moments in SuRo Capital's history. We delivered the largest quarter-over-quarter NAV increase we have ever reported. Our NAV increased approximately 76% quarter-over-quarter. This is not a routine result. It reflects the strength of our portfolio, the quality of companies we have backed and the power of our strategy, giving public stockholders access to high-growth venture-backed companies aligned with important technology trends. We do not view the quarter as the finish line, but as the beginning of the new chapter.

Our recent investment activity, including TensorWave and ClickHouse, reflects the same discipline, identifying private companies where strategic relevance is emerging, building exposure selectively and giving public stockholders access to opportunities that remain largely outside of the public markets.

Our proposed partnership with Magnetar through Neostellar Advisors is designed to provide SuRo Capital with greater scale, stronger infrastructure, broader sourcing reach and deeper diligence capabilities as we seek to invest in and partner with the next generation of high-growth private companies.

NAV captures the progress we have made, the opportunity is what comes next. Our focus now is straightforward, build on this momentum, maintain our discipline and translate portfolio progress into lasting shareholder value.

To our stockholders, thank you for your continued trust and support. With that, I will turn the call over to Allison Green to review our financial results.

Thank you, Mark. I would like to follow Mark's update with a review of our investment activity and portfolio company realizations during the first quarter and subsequent to quarter end, a high-level review of our investment portfolio as of quarter end, including the investment theme breakdown and a more detailed review of our first quarter financial results, including our current liquidity as of March 31. I'll also touch on notable items during the first quarter and subsequent to quarter end, including our announcement of the Board-approved externalization.

On December 31, SuRo Capital's $20 million to Magnetar Opportunity 2025-4 LP, a special purpose vehicle invested in TensorWave, Inc. During the quarter, on January 2, SuRo Capital funded $5 million of the $20 million capital commitment. As of May 5, $5 million of the $20 million capital commitment to Magnetar Opportunity 2025-4 LP had been funded. The remaining commitment of up to $15 million is subject to the satisfaction of certain conditions. Throughout the first quarter, we sold 440,246 common shares of GrabAGunDigital Holdings Inc following the removal of lockup restrictions on January 15. These sales resulted in net proceeds of approximately $1.4 million and a realized gain of approximately $891,000. As of March 31, we hold 599,754 public common shares or approximately 58% of our original position.

Additionally, during the quarter, we received a distribution from our True Global Ventures 4 Plus venture capital fund investment for approximately $246,000. Subsequent to quarter end, on April 8, SuRo Capital completed a $225,000 investment in the common stock of Huntress Labs, Inc. through a secondary transaction. Additionally, on April 22, we completed a $9.5 million investment, excluding fees, in the Series A preferred shares of ClickHouse Inc. through a secondary transaction.

Subsequent to quarter end, SuRo Capital received 2 distributions from CW Opportunity 2 LP, totaling approximately $3 million in net proceeds. CW Opportunity 2 LP is an SPV for which the Class A interest is solely invested in the Class A common shares of CoreWeave, Inc. SuRo Capital has invested in the Class A common shares of CoreWeave, Inc. through its investment in the Class A interest of CW Opportunity 2 LP. The distributions were categorized in aggregate as approximately $902,000 of return of capital and a $2.1 million realized gain. The realized gain is calculated based on the current reporting by the fund and confirmed through our accounting, but may be subject to change or adjustment due to the impact of performance fees that may be charged by the fund.

I would now like to turn to our portfolio as of quarter end. Our top 5 positions as of March 31 were WHOOP, OpenAI, VAST, Blink Health and CW Opportunity 2 LP. These positions accounted for approximately 72% of the investment portfolio at fair value. Additionally, as of March 31, our top 10 positions accounted for approximately 88% of the investment portfolio.

Segmented by 7 general investment themes, the top allocation of our investment portfolio at March 31 was to consumer goods and services, representing approximately 43% of the investment [Technical Difficulty] and Software as a Service were the next largest categories with approximately 29% and 12% of our portfolio, respectively. Approximately 6% of our portfolio was invested in education technology companies and the Financial Technology & Services segment accounted for approximately 5% of the fair value of our portfolio. The Logistics & Supply Chain accounted for approximately 4% of the fair value of our portfolio, and SuRo Sports accounted for 2% as of March 31.

We ended the first quarter of 2026 with a net asset value of approximately $361.6 million or $14.24 per share, which is consistent with our financial reporting. The increase in NAV per share from $8.09 at the end of Q4 2025 was primarily driven by a $6.25 per share increase from the net change in unrealized appreciation of our investments, a $0.04 per share increase resulting from net realized gain on our portfolio investments during the quarter, and a $0.02 per share related to stock-based compensation.

The increase in NAV per share was partially offset by a $0.16 per share decrease due to net investment loss during the quarter. At March 31, there were 25,387,393 shares of the company's common stock outstanding.

Finally, regarding our liquidity at quarter end. We ended the quarter with approximately $46 million of liquid assets, including approximately $43.3 million in cash and approximately $2.7 million in unrestricted public securities. Not included in our unrestricted public securities are approximately $15.9 million of public securities subject to lockup or other sales restrictions as of quarter end. This represents our remaining investment in CoreWeave via our Class A interest of CW Opportunity 2 LP.

Subsequent to quarter end, the purchaser of 6.5% convertible notes due 2029 elected to exercise their conversion option on multiple occasions and convert a total of $5 million of principal into 682,815 shares of SuRo Capital's common stock and $19.56 in cash in lieu of fractional shares. Upon completion of these conversions, the remaining principal balance of the 6.5% convertible notes due 2029 was approximately $30 million.

As Mark mentioned, subsequent to quarter end, on April 2, SuRo Capital's Board of Directors, including all of its independent directors, unanimously approved a proposal to transition from an internally managed BDC to an externally managed structure through a new investment advisory agreement with Neostellar Advisors LLC, an entity jointly owned by certain current SuRo Capital employees and Magnetar Holdings LLC, which is affiliated with Magnetar's multi-strategy alternative investment platform. The externalization is expected to process to enhance investment sourcing and due diligence capabilities through Magnetar's fully integrated platform, preserve all realized gains on the company's existing portfolio for the benefit of stockholders through the exclusion of pre-existing investments from any incentive fee calculations and result in an annual expense savings.

In connection with the externalization, an affiliate of Magnetar will make a $20 million investment in the company and the company's current management team, including Mark Klein and myself, will continue in our current capacities. The externalization is subject to stockholder approval and additional details are set forth in the company's current report on Form 8-K filed with the Securities and Exchange Commission on April 7.

That concludes my comments. We would like to thank you for your interest and support of SuRo Capital. Now I will turn the call over to the operator for the start of the Q&A session. Operator?

[Operator Instructions] We will take our first question from Alex Paris, Barrington Research.

Congrats on the superb Q1 and the plan for externalization. So that's going to be my question, the externalization. As I recall, prior to 2019, the portfolio was externally managed. You took it in and now you're externalizing it again. So point number one. Point number two, I had a quick review of the process, and I see not only are you creating a joint venture with Magnetar under the name Neostellar Advisors LLC, but actually SuRo's name will be changed to Neostellar Capital Corp. under the symbol NSLR. I guess it's a 2-part question. Number one, I think the shareholder meeting, the special shareholder meeting is scheduled for June 10. When do you hope to close this transaction? And then the related question is both you and Allison noted that this is expected to result in cost savings. So I'm wondering if you could just provide a little additional color on how that's done. You're obviously going to pay the external manager a management fee plus an incentive fee. What costs are we eliminating from the internal management of the fund?

Thanks, Alex. That's the longest one question ever, but I appreciate it. So let's start with we were externally managed. We made a determination to be internally managed as we took the management -- the group that managed the portfolio and brought it in-house. As I noted in my prepared remarks, I think a lot has changed in the public venture capital markets. And we came to the conclusion that in order for us to be at the top of the pyramid of all have the largest asset management platform available to invest in public markets, having greater depth from both investment, sourcing, diligence, support, infrastructure, et cetera, to partner with a firm like Magnetar, which we have done an awful lot of investing with over the years, just simply made sense. It makes us the largest platform to invest as a public investor in venture-backed securities. I think that matters right now. I think size matters, I think scale matters. I think the ability to bring other aspects to portfolio companies as opposed to just writing a check matters.

And if you look at the success Magnetar has enjoyed and the fact that we invested with them in CoreWeave, we're investing with them in TensorWave, they are really on top of the game in the venture space. And as capital becomes more important and different capital solutions become more important to private companies, they are a great partner and significantly enhance what we are doing. And again, we're the first ones ever to do it, and we started 15 years ago, and we continue to pioneer as having a terrific partner.

As far as cost savings, it's in the proxy, this will be less expensive for our investors, certainly to start in respect to expenses related to the management of the portfolio. As far as incentive fees, we made a point of saying that the entire portfolio and all the unrealized gains and all the success that has occurred to date and will occurs up until the externalization. There's no incentive fee being charged at all. That is for all of our shareholders in the future as we invest money and we realize profits on those new investments, there may be an incentive fee on that at that point in time, which candidly will be quite some time away from now. So we are really excited about this. This is really differentiated. This makes us as significant as we are now, much more significant. And it was a decision our Board took and we took as management, and we're really excited about that.

The vote is on June 10. This -- upon approval by our shareholders, we will enter into a management agreement with Neostellar. We will rebrand to Neostellar, and that will be effective on July 1. Thank you.

We will take our next question from Marvin Fong, BTIG.

Congrats as well and looking forward to the externalization. I just have a big picture question after all the success, we can all see that the private and public markets around AI are quite excited here. Can you just kind of talk about what you're seeing now in terms of investment opportunity and ClickHouse is another you were able to get in on. But can you -- are you seeing opportunities like you're done with TensorWave to -- that are milestone based and can offer some protection and that these companies actually have to succeed in order to gain access to further capital. Can you expect kind of more structures like that? Or just kind of describe in general what are you seeing out there?

Thanks, Marvin. Great question. And I'll answer it in 2 parts. First of all, we are really excited about ClickHouse. ClickHouse has quickly become the de facto real-time analytics platform. They position themselves to benefit from AI applications, which demand real-time data. This company is growing at 250% year-over-year. It's phenomenal. It provides they're 10x that the rate, the speed of their competitors at approximately 1/10 of the cost. It is truly an amazing company. I suspect most people on this call probably haven't heard about it. We view this as we're in front in the same way we were in front with VAST when no one heard of it or even CoreWeave when no one heard of it. That's how we view ClickHouse. And I suspect as we move towards the end of the year, they will become more notable. That's one.

Two, I think -- and you and I have talked about and I talked about it publicly, the markets are robust or perhaps broadly in the AI space, specifically in the private market side. We see an awful lot. We are seeing more deals now than we've ever seen before. And as we talked about it, you have to start is -- are you in the right -- are the tailwinds still there? Are you in the right sector, subtenant sector? Are you one of many in the space or one of a few? Do you have the right to win? Once you get to all that, can we actually [ invest ], whether it's like TensorWave, which I think is extremely well structured, or can we simply price it in a way that there's an opportunity to invest and see returns. And that leaves an awful lot of companies that candidly at this point in time are tough to invest in. But we have found opportunities, whether it was ClickHouse and TensorWave, as we've discussed before, we are really set up to win. They are to AMD what CoreWeave was to NVIDIA. As most of you can probably see, AMD just reported a blowout quarter. TensorWave is going to be where they're housing their AMD chips. It's an extremely exciting investment. The investment is structured in a way that we put $5 million in, $15 million will be following on, assuming certain conditions are met. And we think that's going to be an absolute [ raging ] success. We're really looking forward to TensorWave's future.

We will take our next question from Jon Hickman with Ladenburg.

I have a question about -- in the past, the top 5 positions have generally around -- they've been around 50% of your portfolio. And currently, the Top 5...

Jon, you still there?

Participant line disconnected. We will take our next question from Brian McKenna, Citizens.

This is Nate Saur on for Brian McKenna. So first of all, congrats on the great moves this quarter and the especially impressive results so far this year. Maybe just extending the discussion on externalization real quick. I was wondering if you guys could provide a little -- or get a little bit more specific on the timing? Like why is right now the...

I think we lost him as well, operator.

Yes, we lost Brian's line. We will take our next question from Alex Fuhrman, Lucid Capital Markets.

I'll try to ask it real quick here and sneak it in. But congratulations guys on the really strong start to the year. I wanted to ask about your portfolio composition here in terms of your sector allocations. Obviously, your investment in WHOOP has been tremendously successful here when you think about that as well as the wind down in your position [Technical Difficulty]. You're kind of at a unique moment here where health and wellness is actually a really large percentage of the portfolio right now. Should we expect to see incremental investments kind of back in that AI area to get that part of the portfolio back up? I guess you already did that subsequent to the quarter here with ClickHouse. But just any kind of high-level thoughts on sort of the composition of your portfolio by sectors and what we should expect to see going forward?

Sure. Thanks, Alex. Yes, in some ways, I guess, we're victims of our own success with WHOOP as WHOOP just completed a $575 million funding over a $10 billion valuation. It's obviously been sort of knocked it out of the park with that. That was -- that is a unique situation for us. It's a great situation, but unique. As you can see, we did just put $10 million into ClickHouse. We're funding another $15 million into TensorWave. And you will see the concentration more into the technology, AI, AI infrastructure, et cetera, again, be the largest focus of our fund. But as you did note, right now, with the success of WHOOP, that has caused a bit of concentration in that space.

There are no further questions on the line. So I will now hand you back to your host for closing remarks.

Thank you all for joining this call. We greatly appreciate it. Sorry for a couple of the problems apparently with the questions. But we're very excited here. We had obviously the best quarter we've had on a quarter-over-quarter basis ever. We're extremely excited about our partnership with Magnetar and the rebranding to Neostellar. We're always available for your questions or comments, feel free to reach out to us. And thank you again for attending the call. We greatly appreciate it.

Thank you for joining today's call. You may now disconnect.

Welcome to the SuRo Capital's Fourth Quarter and Fiscal Year 2025 Earnings Call. My name is Alan, and I will be your coordinator for today's event. Please note, this call is being recorded. [Operator Instructions] I will now hand you over to your host, Jackson Stone, to begin today's conference. Thank you.

Thank you for joining us on today's call. I'm joined today by the Chairman and Chief Executive Officer of SuRo Capital, Mark Klein; and Chief Financial Officer, Allison Green. Please note that a slide presentation corresponding to today's prepared remarks by management is available on our website at www.surocap.com under Investor Relations, Events and Presentations.

Today's call is being recorded and broadcast live on our website, www.surocap.com. Replay information is included in our press release issued today. This call is the property of SuRo Capital and the unauthorized reproduction of this call in any form is strictly prohibited. I would also like to call your attention to customary disclosures in today's earnings press release regarding forward-looking information.

Statements made in today's conference call and webcast may constitute forward-looking statements, which relate to future events or our future performance or financial condition. These statements are not guarantees of our future performance or future financial condition or results and involve a number of risks, estimates and uncertainties. And including the impact of any market volatility that may be detrimental to our business, our portfolio companies, our industry and the global economy that could cause actual results to differ materially from the plans, intentions and expectations reflected in or suggested by the forward-looking statements.

Actual results may differ materially from those in the forward-looking statements as a result of a number of factors, including, but not limited to, those described from time to time in the company's filings with the SEC. In addition, the preliminary financial estimates regarding the company's estimated accretion to current net asset value provided herein have been prepared by and on the responsibility of the management of the company. This information is preliminary and is thus inherently uncertain and subject to change.

Actual results relating to the company's net asset value for any period subsequent to December 31, 2025, including March 31, 2026, may differ materially. Management does not undertake to update such forward-looking statements unless required to do so by law.

To obtain copies of SuRo Capital's latest SEC filings, please visit our website at www.surocap.com or the SEC's website at sec.gov. Now I would like to turn the call over to Mark Klein.

Thank you, Jackson. Good afternoon, everyone, and thank you for joining us. This is an important moment for SuRo Capital. We are entering 2026 with meaningful momentum across our portfolio a disciplined investment strategy, substantial embedded value and what we believe is a highly differentiated position in 1 of the most consequential technology cycles of our time.

Before I review our full year results, I want to begin with what has happened since year-end because those developments matter. They matter for our portfolio, they matter for how we see the opportunity ahead and most importantly, they matter for our shareholders. Since the beginning of 2026, public markets have been mixed, volatility has remained a feature of the environment. sentiment has moved back and forth. But beneath the day-to-day noise, 1 much more important trend has continued to strengthen the global build-out of AI infrastructure is accelerating.

We do not view this as a passing theme. We do not view this as a short cycle. We view it as a structural shift in how the modern economy will be built. Across the largest technology platforms in the world, capital commitments continue to rise. That tells us something important. AI is no longer being treated as an experimental initiative, it is becoming core infrastructure, it is becoming central to how businesses compete, how they invest and how they grow.

And when capital begins moving at that scale, the effects extend far beyond the largest public companies. It benefits foundational infrastructure, it benefits enabling software. It benefits private companies building essential tools, platforms and systems that support this transition. That is where SuRo is positioned. Against that backdrop, we continue to see strong execution across our portfolio. Since the end of the year, several of our portfolio companies have completed or are in the process of finalizing significant financing. Based on indications available today, and assuming each of these financings closed and the remainder of our portfolio remains as it was at 12 -- at the end of this year.

Valuation, we believe, at the end of 2025 valuation -- we believe these financings will -- could contribute at least $5 and as much as $6.50 per share to our current net asset value. This is highly significant. And I want to underscore 1 point very clearly as these developments across [ Eurozon ] 2026, they are not reflected in our fourth quarter 2025 net asset value. So while our reported year-end NAV reflects a year of strong underlying performance, it does not yet capture what we believe is a meaningful amount of value creation that has already emerged clearly this year.

Now because several of these transactions have not yet publicly been disclosed, there are limits to what we can share today, but the direction is clear. The progress is real. And as more of these developments become public, we will expect to provide full context in our first quarter prerelease and earnings call.

One financing that has been widely reported and 1 worth highlighting is OpenAI. This transaction was notable not only for its size but for what it represents. It reflects the extraordinary scale of capital now being committed to AI development and to the infrastructure required to support it. It reflects the capital intensity of this next era of computing, and it reinforces the fact that AI has moved from possibility to priority.

Moments like this help define markets. They show where strategic capital is flowing they show where conviction is building, and they validate a core principle behind our strategy. Some of the most important value creation and technology happens while great businesses are still private. That is where we seek to invest. That is where we seek to build exposure, and that is where we believe SuRo offers shareholders something distinct.

As noted earlier, this financing occurred in the first quarter of '26 and is therefore not reflected in our year-end NAV. More broadly, we continue to believe AI is a multiyear structural transformation that remains in its early stages. It is moving from research into deployment from experimentation into integration and from isolated use cases into broad commercial adoption, as that happens, the opportunity set continues to expand.

Some companies will benefit directly by providing the infrastructure, compute and tooling that make this [ ship ] possible. others will benefit indirectly through increased demand for software, automation, data and more efficient digital systems. We believe both dynamics matter, and we believe both are increasingly relevant across our portfolio. This is 1 of the reasons we remain constructive on the road ahead.

Public markets offer investors exposure to many of the largest and most established beneficiaries of technological change. But by the same -- but by the time many of those companies are broadly owned, a meaningful share of the early value creation has already taken place. SuRo is positioned differently. We provide market -- public market investors access to venture-backed private companies earlier in their life cycles before broad public ownership and often for the full scale of their long-term potential is reflected in market value. That matters because early in the company's life innovation can be sharper, growth can be faster, strategic advantage can be more pronounced.

And when those companies execute the value creation can be extraordinary. Our responsibility is to identify those businesses carefully, invest with discipline, remain patient with where conviction is high and realized gains thoughtfully when liquidity opportunities emerge. We do not chase noise. We do not allocate capital for appearances. We focus on quality. We focus on asymmetry and we focus on long-term shareholder value.

When we look back on 2025, we believe the results speak clearly, our stock price increased from $5.88 per share at year-end to $9.44 at the end of '25, an increase of over 60%. Including our $0.50 dividend per share declared and paid during the year, total shareholder return approximated 70%. That is a strong outcome. It reflects performance across the portfolio, it reflects disciplined capital allocation, and we believe it reflects increasing recognition of the value embedded in SuRo Capital.

Our net asset value also grew meaningfully, at the end of '24, our NAV was $6.68. By the end of '25, it had increased to $8.09, representing year-over-year growth of approximately 21%. In addition, during 2025, we declared and paid $0.50 per share in cash dividends. On a dividend-adjusted basis, our December 31, 2025 NAV would have been approximately $8.59 per share, representing a year-over-year growth of approximately 29%. Again, our reported NAV -- our reported year-end NAV mark does not include the previously referenced potential increases in value from the '26 financings which could contribute at least $5 per share and as much as $6.50 per share to our current net asset value. This is important because it reflects how we think about stewardship we are committed not only to building value, but to realizing value, not only to compounded capital but returning capital when appropriate.

Our objective is straightforward, to create durable long-term value for shareholders and do so with discipline, transparency and accountability. At the same time, we continue to invest with conviction to strongest. Our recent commitment to [ Tensor Wave ] is a good example. We believe [ TensoWave ] is operating in a part of the market that stands to benefit directly from 1 of the most powerful secular trends in technology rising demand for AI compute. [ PensaWave ] is deployed what the company described at the time as the world's largest liquid cool AMD GPU cluster, and has continued to expand the footprint, including through 2 additional 10-megawatt deployments in Arizona and Pennsylvania.

As customers seek performance, scale and diversification in an increasingly important layer of the technology stack, we believe this company is well positioned. More broadly, we see further evidence of this trend and announcements such as Meta's recent multiyear agreement with AMD to support up to 6 gigawatts of AI infrastructure. This investment expands our exposure to infrastructure and reflects a broader principle that guides us.

When the world is changing in a fundamental way, the company is enabling that change can become extraordinarily valuable. We intend to remain disciplined, but we also intend to be decisive where we see this kind of opportunity. So when I look at where SuRo stands today, I see a company with momentum in the portfolio meaningfully embedded upside, a strong liquidity position and a strategy aligned with some of the most important innovation trains in the global economy.

We are confident in what we own. We are disciplined in how we invest we are thoughtful in how we realize gains, and we are clear about who we work for, our shareholders. Our mission is to give public investors access to exceptional private companies before they become broadly owned and to convert that access into long-term shareholder value through disciplined execution over time. That is what we are building. That is what we are focused on, and that is why we are excited about the road ahead.

With that, I will turn the call over to Allison.

Thank you, Mark. I would like to follow Mark's update with a review of our investment activity and portfolio company realizations during the fourth quarter and subsequent to year-end, a high-level review of our investment portfolio as of year-end, including the investment theme breakdown and a more detailed review of our fourth quarter financial results, including our current liquidity as of December 31. I'll also touch on notable items during the fourth quarter and year-end, including our cash dividend, debt repurchases and capital raised and shares issued via at the market offering, or ATM program and recent Board approved updates to the note repurchase program and the share repurchase program.

Throughout the fourth quarter, we received distributions from CW opportunity to LP following the lifting of sales restrictions on the publicly traded CoreWeave stock held by the fund on August 15, 2025. CW Opportunity 2 LP is an SPV for which the Class A membership interest is solely invested in the Class A common shares of CoreWeave, Inc. SuRo Capital has invested in the classic common shares of CoreWeave Inc. through its investment in the Class A membership interest of CW Opportunity 2 LP.

We received 3 distributions during the fourth quarter totaling approximately $9 million and were categorized in aggregate as approximately $2.3 million return of capital and $6.7 million gain. The aggregate fourth quarter distributions represent approximately 15.3% of our $15 million investment in CW opportunity to LP. As of year-end, we continue to have exposure to CoreWeave through the remaining 68.1% of our initial investment in CW opportunity to LP.

On November 6, we sold our remaining 7,530 public common shares of [ Forge Global ], Inc. for net proceeds of approximately $3.1 million, resulting in a realized gain of approximately $1.1 million. The total realized gain on this investment is approximately $5 million. On October 16, SuRo Sports portfolio company, [ Rebreak Inc ]., doing businesses under the name Compliable approved a plan to dissolve the company. As a result, -- so capital realized the loss of approximately $1 million on the position.

Finally, we received a distribution from true Global Ventures for Plus venture funds for approximately $137,000. As Mark mentioned, on December 31, SuRo Capital committed up to $20 million to Magnetar Opportunity 20254 LP, a special purpose vehicle invested in [ Tensor Wave Inc. ] Subsequent to year-end, on January 2, SuRo Capital funded $5 million of the $20 million capital commitment. As of March 10, $5 million of the $20 million commitment to [indiscernible] book opportunity 2025 royalty had been funded.

The remaining commitment of up to $15 million is subject to the satisfaction of certain conditions. Subsequent to year-end, we sold 16,580 common shares of [indiscernible] Digital Holdings, Inc. following the removal of [indiscernible] on January 15. These sales resulted in net proceeds of approximately $327,000 and a realized gain of approximately $214,000. As of March 10, we continue to hold 933,420 public common shares or approximately 90% of our original position. Additionally, subsequent to year-end, we received a distribution from [indiscernible] Ventures 4s venture fund for approximately $246,000.

I would now like to turn to our portfolio as of year-end. Our top positions as of December 31 were OpenAI, WHOOP, [ Blink Health ], Canva and Learneo. These positions accounted for approximately 54% of the investment portfolio at fair value. Additionally, as of December 31, our top 10 positions accounted for approximately 80% of the investment portfolio. Segmented by 7 general investment themes, the top allocation of our investment portfolio at December 31 was to artificial intelligence infrastructure and applications, representing approximately 31% of the investment portfolio at fair value.

Consumer Goods and Services and Software as a Service were the next largest categories with approximately 21% and 20% of our portfolio, respectively. Approximately 11% of our portfolio was invested in education technology companies and the Financial Technology & Services segment accounted for approximately 8% of the fair value of our portfolio. The logistics and supply chain category accounted for approximately 8% of the fair value of our portfolio and SuRo Sports accounted for 2% as of December 31.

We ended the fourth quarter and fiscal year 2025 with a net asset value of approximately $205.3 million or $8.09 per share, which is consistent with our financial reporting. The increase in NAV per share from $9.23 at the end of Q3 was primarily driven by an $0.84 per share decrease from the net change in unrealized depreciation of our investments a $0.25 per share decrease from the impact of dividends declared and paid during the quarter, a $0.22 per share decrease due to net investment loss and a $0.10 per share decrease related to stock-based compensation.

The decrease in NAV per share was offset by a $0.27 per share increase resulting from the net realized gain on our portfolio investments during the quarter. During Q4, we sold 6,595 shares under the ATM program at a weighted average price of $9.80 per share for gross proceeds of approximately $55,000 and net proceeds of approximately $63,000 after deducting commissions to the agents on shares sold. As of year-end, up to approximately $87.9 million, an aggregate amount of the shares remain available for sale under the ATM program.

On October 29, SuRo Capital's Board of Directors approved an extension of the discretionary note repurchase program, which allows us to repurchase us to an additional $40 million or the remaining aggregate principal amount of our 6% notes due 2026 and through open market purchases, including block purchases in such manner as will comply with the provisions of the Investment Company Act of 1940 as amended, and the Securities Exchange Act of 1934 as amended. Subsequent to this approval, during the fourth quarter, we repurchased an additional 153,513 of the 6% notes due 2026 under the note repurchase program.

As of December 31, we have repurchased 1,566,807 or approximately $39.2 million in aggregate principal dollar amount of the 6% notes due 2026 under the note repurchase program or approximately $38.9 million, inclusive of broker commissions. This represents approximately 52% of the original total issuance. The aggregate principal dollar amount of 6% notes that may yet be repurchased by SuRo Capital under the note repurchase program is approximately $35.8 million.

As Mark mentioned earlier, SuRo Capital is committed to initiatives that enhance shareholder value. As such, on October 29, our Board of Directors authorized an extension of the company's discretionary share repurchase program until the earlier of October 31, 2026, for the repurchase of $64.3 million in aggregate amount of the company's common stock, of which $25 million remains available for future repurchases.

Additionally, on November 3, we SuRo Capital's Board of Directors declared a cash dividend of $0.25 per share paid on December 5 to the company's common stockholders of record as of the close of business on November 21. This dividend was generally attributable to the successful monetization of public securities and other promising developments in our investment portfolio. The declaration the data declaration and amount of any dividends or distributions, including any future distributions are subject to the sole discretion of SuRo Capital's Board of Directors. The aggregate amount of distributions declared and paid by SuRo Capital will be fully taxable to stockholders.

The federal income tax classification of capital expenditure 2025 distributions has been determined to be capital gains. SuRo Capital reports the tax characteristics of each year's distributions annually to stockholders and the IRS on [ Form 1099 ] subsequent to year-end. As a result of the $0.25 per share cash dividend paid on December 5 to stockholders of record as of the close of business on November 21. Effective as of November 21, the conversion rate applicable to the 6.5% convertible notes due 2029 was adjusted to $7.32 per share from the prior conversion price of $7.53 per share, which has been effective since July 21.

The adjustment to the conversion rate of the 6.5% convertible notes due 2029 was made pursuant to the note purchase agreement governing the 6.5% convertible notes due 2029. At December 31, there were 25,377,756 shares of the company's common stock outstanding.

Finally, regarding our liquidity as of year-end. We ended the year with approximately $50.1 million of liquid assets including approximately $49 million in cash and approximately $1.1 million in unrestricted public securities. Not included in our unrestricted public securities are approximately $17.8 million of public securities subject to lockup or other sales restrictions as of year-end. This represents our remaining investment in CoreWeave via our Class A interest of CW opportunity to LP and the public common shares of Grabagan that became unrestricted subsequent to year-end.

That concludes my comments. We would like to thank you for your interest and support of SuRo Capital. Now I'll turn the call over to the operator to start the Q&A session. Operator?

[Operator Instructions] We will take our first question from Alex Paris, Barrington Research.

Congrats on a strong 2024 -- 2025, sorry.

Alex, you're kind of cutting in and out.

I'm sorry. Let me switch, can you hear me?

Yes. All good, go ahead.

Okay. Good. So my question will be related to the $5 to $6.50 and have per share. expected as a result of financings, either completed or are being finalized. I know you said in your prepared comments, you can't talk which portfolio companies other than OpenAI, which is in the public realm. But I guess my question relates to time line. How many do you -- how much do you expect to be completed in Q1, and then how much do you expect to be completed between the end of Q1 and the end of 2026, just on the basis of $50 to $6.50 a share.

Yes. So unfortunately, because of certain of restrictions, we can't really discuss it. But we believe that they will all be completed certainly by the end of the quarter. That doesn't mean that they will be necessarily announced by the companies that are completing the financing.

We will take our next question from Brian McKenna from Citizens Bank.

This is Nate Tower on for Brian. So I kind of also want to look a little bit at that $5 to $650. And I guess speaking a little bit more broadly -- what are some of the drivers you guys are seeing there? So I know you mentioned OpenAI and you mentioned a little bit around that. But I guess, more broadly, what are some things that kind of leading to appreciation, that extreme? And are there things you're seeing across your entire portfolio? Or is it a little bit more concentrated? And then I guess on the other side of that, are there any offsets that we should maybe be aware of given that we're now already in March?

No problem. So there's been multiple financings that have either occurred are occurring and have not necessarily been announced. Obviously, when drivers of that type of magnitude, there's significant portfolio positions that are driving that. As to what we're seeing around our other portfolio, I think it's market conditions which drive market multiples will have some impact on other parts of our portfolio.

We will take our next question from Alex Fuhrman, Lucid Capital.

Great. Congratulations on a really strong year in 2025, can you help us just kind of level set some of the less exciting parts of the model for this year that's very exciting that there could be some pretty substantial near-term appreciation in the NAV. What are kind of some base case numbers we should be thinking about given the portfolio you have this year for things like investment income and just operating expenses on a quarterly basis given how much you've grown the portfolio.

Sure. So to start with -- and thank you for your kind words. 2024 was a really good year. 2025, as we've spoken about extensively now over the last 20 minutes is starting out to be extraordinary. As to the specific questions, we don't really generate income outside of realized capital gains. So we don't have a yield portfolio, as you know. And our operating expenses have been pretty static over the last 2 years, and we wouldn't expect them to be significantly different at all.

We will take our next question from Marvin Fong, BTIG.

Great. let me add my congratulations as well on all the great progress here. My question is on the latest investment in [ Tensor wave ] and not so much on Tensor Wave itself, but the $20 million commitment, I believe, is 1 of your largest ever more than OpenAI in fact. And I understand that rounds are getting larger. But could you just kind of comment on whether this was sort of a special case? Or do you feel like your regular investment size will be increasing? Or is it sort of that appetite focused primarily on AI. Just kind of help us understand the dynamics there.

Thanks, Marvin, and thanks for the kind words. And good question. What we saw in Tensor Wave is an opportunity to invest on the AMD side, of the chips as opposed to the NVIDIA side. But we saw it in a structure that allows us to invest a little bit and upon certain obligations being fulfilled that would be extremely value enhancing to Tensor Wave into the investment to have a springing effect in our investments.

So we got very excited to be able to be in early with a company that is fully aligned with AMD with Andy's full support and do it in a way that limits our initial exposure until things prove out in the way that we think and then make it a significant investment. I don't think it speaks necessarily to all of our investments would be $20 million, obviously, given the size of the portfolio. But it does speak to our feeling that this is an opportunity that we want to lean into more fully.

We will take our next question from Jon Hickman Ladenburg.

So Mark, could you give us some comments about your thoughts on private market valuations versus what's going on in the public side...

An hour.

Well, our but 2 minutes. I mean some of the public companies are building out AI stuff are not getting the kind of valuations that appear to be happening on the public -- on the private segment.

So John, I'll zoom out a little bit. And we spent an awful lot of time looking at this internally because what -- and I think we've probably talked about it on our last earnings call, the acceleration and both the acceleration in pricing and the acceleration in rounds that are occurring is pretty unprecedented. We went back and looked at sort of the 2019, 2021 period of time to see the acceleration of valuation and the rapid levels. The rapid different capital raises. And we look back at the effectively public venture market, which was the 1999 to 2001 to sort of see where we sit relative to what's gone on historically.

And what is clear is that the rapid nature of the growth of value and the rapid amount of consistent raises is more attended '99 to 2001 and you are seeing separation now from what the public valuations are versus the private valuations. Clearly, the acceleration in the private markets has exceeded what's going on in the public markets.

There are no further questions on the line. So I'll now hand you back to your speaker for closing remarks.

Well, thank you all for taking the time to visit with us today. I hope that you're excited about what's going on in SuRo as our team is. This has been -- was an exciting year last year.

This year is started out to be even more excited than last year. There's a lot of things for us to be doing. I think we are taking advantage of it. And the whole team is looking forward to '26 and the years to come. Thank you all very much.

Thank you for joining today's call. You may now disconnect.

Welcome to the SuRo Capital's Third Quarter 2025 Earnings Call. My name is Alan, and I will be your coordinator for today's event. Please note, this call is being recorded. [Operator Instructions]

I will now hand you over to your host, Ben Miller, to begin today's conference. Thank you.

Thank you for joining us on today's call. I'm joined today by the Chairman and Chief Executive Officer of SuRo Capital, Mark Klein; and Chief Financial Officer, Allison Green. Please note that a slide presentation corresponding to today's prepared remarks by management is available on our website at www.surocap.com under Investor Relations, Events and Presentations.

Today's call is being recorded and broadcast live on our website, www.surocap.com. Replay information is included in our press release issued today. This call is the property of SuRo Capital and the unauthorized reproduction of this call in any form is strictly prohibited.

I would also like to call your attention to customary disclosures in today's earnings press release regarding forward-looking information. Statements made in today's conference call and webcast may constitute forward-looking statements, which relate to future events or our future performance or financial condition. These statements are not guarantees of our future performance or financial -- or future financial condition or results and involve a number of risks, estimates and uncertainties, including the impact of any market volatility that may be detrimental to our business, our portfolio companies, our industry and the global economy that would cause actual results to differ materially from the plans, intentions and expectations reflected in or suggested by the forward-looking statements.

Actual results may differ materially from those in the forward-looking statements as a result of a number of factors, including, but not limited to, those described from time to time in the company's filings with the SEC. Management does not undertake to update such looking forward statements unless required to do so by law. To obtain copies of SuRo Capital's SEC filings, please visit our website at www.surocap.com or the SEC's website at sec.gov.

Now I'd like to turn the call over to Mark Klein.

Thank you, Ben. The third quarter was another strong period for SuRo Capital, extending the rapid acceleration we have seen across public and private technology markets, particularly in artificial intelligence and digital infrastructure. Despite intermittent market volatility and ongoing geopolitical uncertainty, investor conviction in the AI build-out remained exceptionally strong.

As outlined in our recent white paper, AI infrastructure, the great mobilization of our time. We view this as a generational shift where capital deployment in AI infrastructure is larger in scale than many historic national mobilizations, such as the New Deal and the Apollo Space program.

As of September 30, 2025, our net asset value was $9.23 per share compared to $9.18 per share on June 30 or $8.93 on a dividend-adjusted basis and $6.73 per share at the end of the third quarter of '24 or $6.48 on a dividend-adjusted basis. About 18 months ago, we made a deliberate decision to focus on AI infrastructure, the compute, networking and data layers that make modern AI possible. That decision guided our strategy and led to cornerstone investments that have since proven transformative.

Our initial position began with CoreWeave, followed by OpenAI and soon after VAST Data. Each reflected our belief that as AI scaled, the demand for compute, storage and power would accelerate faster than most anticipated. At the time, relatively few investors were focused on these areas.

We saw opportunity where others hesitated. We acted early, built conviction and invested behind teams we believe would define the next wave of computing. Many saw CoreWeave as too specialized with a complicated capital structure or VAST Data as another storage play, but we saw companies at the bedrock of a new wave of innovation with incredible tech teams growing customer traction and the beginning of a generational computing cycle.

That early conviction has since been validated as these companies have emerged as core enablers of the AI economy. That conviction has translated directly into results across our key holdings. CoreWeave has gone from a relative unknown to one of the fastest-growing infrastructure providers in the world, now trading at approximately 3x its IPO price.

We have prudently taken some profits, but still own over 40% of our position in CoreWeave. OpenAI, the engine behind such -- so much of today's AI innovation is reportedly contemplating a $1 trillion IPO, over 6x our initial entry valuation and more than 3x the value at which we marked the position at the end of the third quarter.

VAST Data, once quietly building in the background, is now at the center of AI's data infrastructure conversation and reportedly in discussions for a raise at a valuation more than 3x our entry point. Our portfolio reflects a conviction-driven approach anchored in high-impact themes like AI infrastructure and innovation, giving investors unique access to category-defining companies driving this transformation. These results stem from a disciplined process, research-driven, conviction-led and patient.

We leaned in when others hesitated, stayed confident when the market was uncertain and believe the opportunity ahead remains even greater. With that backdrop, let me turn to how this strategy is playing out across our portfolio, beginning with our exposure to AI infrastructure and foundational models.

Please turn to Slide 4. In October, OpenAI completed a major restructuring forming OpenAI Group PBC, a public benefit corporation. This simplified its prior cap profit model and complex share structure, enhancing transparency, governance and flexibility for future capital formation. This restructuring also positions OpenAI for broader participation in public markets and long-term scalability.

Following the restructuring, Reuters and Bloomberg have reported that OpenAI is preparing for a potential initial public offering that could value the company at up to $1 trillion, one of the largest in history. If completed, the offering could raise more than $60 billion according to those reports or over twice the $26 billion raised in the Saudi Aramco public offering in 2019. At the potential $1 trillion valuation referenced in recent media reports, our exposure to OpenAI could represent roughly 1/3 of the net assets on a pro forma basis, assuming no material changes in other holdings.

For clarity, our current third quarter -- in our third quarter reporting, SuRo Capital's Q3 valuation and NAV are reflective of the previously announced $300 billion money round as confirmations of the higher $500 billion valuation occurred after the close of the quarter.

We view OpenAI as one of the defining companies of this era, an organization that continues to set the pace of innovation while reshaping global infrastructure demand. Today, it stands as the world's largest private company, expanding rapidly as AI becomes embedded in daily life and redefines workflows. The company's scale, reach and capital intensity exemplify the structural shifts now underway across AI, and we believe that through our significant exposure as well as our other AI-relating holdings, SuRo offers one of the most direct ways for public market investors to participate in and benefit from this era of transformational growth.

We expect continued investor interest in SuRo Capital's portfolio as a differentiated way to gain exposure to OpenAI and the broader AI infrastructure powering this generational shift.

Turning to infrastructure and compute. CoreWeave remains a defining position within our portfolio and the largest single investment cost in SuRo Capital's history. As of quarter end, it remains our largest position at fair value and one of the primary beneficiaries of accelerating demand for AI infrastructure.

During the quarter, we monetized approximately 16.6% of our position in CW Opportunity 2, generating $7.2 million in net proceeds, including $4.7 million in realized gains. Subsequent to quarter end, we realized additional net proceeds of $7 million and realized gains of $5.3 million while maintaining a meaningful stake in the position.

We expect continued monetizations from investment following the distribution subject to quarter end, we hold over 40% of our original position in CoreWeave. CoreWeave has emerged as one of the fastest-growing infrastructure providers in the world, driven by record GPU demand and partnerships with OpenAI, Microsoft and Google, including long-term supply agreements for NVIDIA's Blackwell GPUs and contracts totaling roughly $22 billion with OpenAI alone.

The market continues to validate our early conviction that AI workload growth would rapidly outpace traditional cloud capacity, creating sustained demand for specialized infrastructure providers, with reports from McKinsey & Company and the U.S. Department of Energy projecting continued growth in AI-related data center power moving forward.

CoreWeave remains central to what we called the great mobilization of compute. Beyond compute infrastructure, we are also seeing innovation across emerging digital and financial systems, including a new investment we made during the quarter and during the quarter.

Please turn to Slide 5. Consistent with our commitment to invest early in category-defining infrastructure. In September, we made a $5 million investment in HL Digital Assets, Inc., which holds a position in HYPE, the digital token of Hyperliquid, a decentralized exchange designed for transparent, high-speed derivative and spot trading on chain. Hyperliquid has quickly become one of the fastest-growing decentralized exchanges by trading and user adoption, offering low latency execution and advanced liquidity infrastructure.

In recent weeks, HYPE has seen increased attention following its listing on Robinhood's crypto platform, which expanded access and drove a notable uptick in token trading volume and liquidity. Reports have also indicated that Hyperliquid Strategies, a newly listed company, is targeting a raise of approximately $1 billion to support its treasury holdings and token accumulation strategy, further underscoring growing institutional interest in the platform. These developments have contributed to a stronger market momentum for HYPE and reinforce our view of Hyperliquid's growing importance within the decentralized financial infrastructure landscape.

Hyperliquid represents the next generation of decentralized financial infrastructure, bringing institutional-grade performance to on-chain markets. We view this as a natural extension of our broader investment strategy, reflecting our focus on foundational systems that enable digital markets to scale efficiently. Shifting from our infrastructure layer holdings, our consumer and fintech portfolio companies continue to represent an important component of our overall investment mix and include several that are advancing towards larger scale.

Starting with WHOOP, which continues to strengthen its position at the intersection of health, performance and technology. In October of 2025, WHOOP announced Advanced Labs, a new offering that combines clinician-reviewed blood testing with continuous wearable data, expanding its platform into diagnostics and precision health. This evolution reflects a broader industry trend toward integrating biometric data with AI-driven analysis to help transform health information into actionable insights.

As technology companies continue to advance, these integrated systems moving from reactive tracking toward more proactive, personalized and valuable health insights. It underscores WHOOP's ability to connect hardware data and health science in ways that deepen engagement and expand its addressable market.

Moving to Canva. The company remains one of the most recognizable private software platforms globally, with approximately $3.3 billion in annual recurring revenue and more than 240 million monthly active subscribers. Our initial investment gave us early access to a company redefining design collaboration for teams and enterprises worldwide. The company continues to deliver strong financial performance and recently completed an employer tender valuing it at about $42 billion. Following the success of Figma's IPO, Canva's scale, growth and profitability highlights its potential to be one of the next major public design platforms. Canva remains a standout performer within our portfolio and a company we are closely tracking as it relates to potential monetization opportunities.

Lastly, I would like to highlight Liquid Death, an existing portfolio company where we made a $0.25 million follow-on investment in July through a convertible note. Liquid Death continues to scale its unconventional brand in premium beverages and recently announced its Sparkling Energy line, scheduled for a January '26 launch, expanding its portfolio beyond water and tea. We remain excited about the company's growth trajectory as it continues to expand into new growth and strengthen its position in the premium beverage market.

With the overall of -- with that overview of key portfolio developments, I will now turn to financial and portfolio updates. Consistent with our commitment to enhance shareholder value, our Board of Directors took several steps this quarter to strengthen our capital structure and support long-term returns. First, our Board declared a $0.25 per share cash dividend paid to shareholders of record as of November 21, with a payment date of December 5. This underscores our confidence in both the strength of our portfolio and our liquidity position. Based on the size and timing of anticipated near-term future monetizations, we expect to declare and pay additional dividends in either the fourth quarter or early in the first quarter of 2026. Based on -- building on these actions, our Board approved an extension of our existing share repurchase authorization, providing ongoing flexibility to buy back shares opportunistically.

In addition, our Board authorized an additional repurchase of our 6% notes due December 30, 2026, allowing us to buy back the remaining outstanding notes. These measures reflect our ongoing focus on optimizing our capital structure and delivering shareholder value. As exciting as these results are, the story is far from over. The AI revolution, which we have called the great mobilization is still in its early innings and the opportunities ahead are among the largest and most transformative we have seen.

Every layer of the computing stack, from chips and networks to data and applications, is being redefined. Our approach remains the same: identify the foundational layers of change early, back the best teams building in those spaces, and hold with conviction as values compound over time.

We are not just celebrating success. We are positioning for what is next because while it has been an extraordinary run so far, the most exciting part is still -- is that we are still just getting started. Thank you for your continued support.

I will now turn the call over to Allison Green to review our financials.

Thank you, Mark. I would like to follow Mark's update with a review of our investment activity and portfolio company realizations during and subsequent to Q3, a high-level review of our investment portfolio as of quarter end, including the investment theme breakdown of our portfolio, and a more detailed review of our third quarter financial results, including our current liquidity as of September 30. I'll also touch on notable items during the third quarter and subsequent to quarter end, including our recent dividend and the declaration of an additional dividend, capital raised, and shares issued via the at-the-market offering, or ATM program and recent Board-approved updates to the note repurchase program and the share repurchase program.

Please turn to Slide 6. As Mark mentioned, on September 18, we made an approximately $5 million investment in the preferred shares of HL Digital Assets, Inc. HL Digital Assets, Inc.'s primary purpose is to invest in HYPE, the digital token of Hyperliquid. The $5 million does not include prepaid expenses paid at the time of the investment or other capitalized costs of the transaction. During the quarter, we also made a $250,000 follow-on investment in Liquid Death's recent 4.12% Series S convertible notes due June 2028. This follow-on investment brings our aggregate investment in Liquid Death to approximately $10.3 million to date.

During the third quarter, we received distributions from CW Opportunity 2 LP following the lifting of sales restrictions on the publicly traded CoreWeave stock held by the fund on August 15. CW Opportunity 2 LP is an SPV for which the Class A membership interest is solely invested in the Class A common shares of CoreWeave, Inc. SuRo Capital is invested in the Class A common shares of CoreWeave, Inc. through its investment in the Class A membership interest of CW Opportunity 2 LP. The 2 third quarter distributions totaled approximately $7.2 million and were categorized in aggregate as approximately $2.5 million return of capital and $4.7 million gain. The aggregate third quarter distribution represented approximately 16.6% of our $15 million investment in CW Opportunity 2 LP. As of quarter end, we continue to have an exposure to CoreWeave through our remaining 83.4% of our initial investment in CW Opportunity 2 LP.

During the third quarter, following the successful merger of GrabAGun Digital Holdings, Inc. and Colombier Sponsor II LLC in mid-July, we sold 395,512 public warrants of GrabAGun Digital Holdings for net proceeds of approximately $660,000, resulting in a realized gain of approximately $537,000. GrabAGun public shares are anticipated to be unrestricted in January 2026.

As of quarter end, we hold 1,204,488 remaining public warrants and 1,000,040 public common shares, or approximately 75% of our original position. Subsequent to quarter end to date, SuRo Capital has received 2 additional distributions from CW Opportunity 2 LP, totaling approximately $7 million. In aggregate, the distributions were categorized as approximately $1.7 million return of capital and $5.3 million gain. The aggregate-to-date distributions totaled $14.2 million and represent approximately 28.2% of our $15 million investment in CW Opportunity 2 LP. Currently, SuRo Capital retains approximately 71.8% of our investment in CW Opportunity 2 LP.

Additionally, subsequent to quarter end on October 16, Rebric Inc. doing business under the name Compliable, approved a plan to dissolve the company. As a result, SuRo Capital realized a loss of approximately $1 million on the position. Finally, subsequent to quarter end, we received a distribution from True Global Ventures 4 Plus Venture Capital Fund for approximately $137,000.

I would now like to turn to our portfolio as of quarter end. Please turn to Slide 7. Our top 5 positions as of September 30 were CW Opportunity 2 LP, WHOOP, OpenAI, Blink Health and Learneo. These positions accounted for approximately 52% of the investment portfolio at fair value. Additionally, as of September 30, our top 10 positions accounted for approximately 75% of the investment portfolio.

Please turn to Slide 8. Segmented by 7 general investment themes, the top allocation of our investment portfolio at September 30 was to artificial intelligence, infrastructure and applications, representing approximately 30% of the investment portfolio at fair value. Consumer goods and services and Software-as-a-Service were the next 2 largest categories with approximately 20% and 19% of our portfolio, respectively. 11% of our portfolio was invested in financial technology and services, and education technology companies accounted for approximately 10% of the fair value of our portfolio. The logistics and supply chain category accounted for approximately 8% of the fair value of our portfolio and SuRo Capital Sports accounted for approximately 2% as of September 30.

Please turn to Slide 9. We ended the third quarter 2025 with a net asset value of approximately $231.8 million or $9.23 per share, which is consistent with our financial reporting. This compares to a dividend adjusted NAV of $8.93 per share as of June 30. The increase was driven primarily by valuation appreciation in several of our top positions.

More specifically, the increase in NAV per share from $9.18 at the end of the second quarter was primarily attributable to a $0.23 per share increase driven by the net unrealized appreciation of our investment portfolio during the third quarter, a $0.21 per share increase due to net realized gain on the sale of investments and a $0.03 per share increase from the impact of stock-based compensation during the third quarter. These increases were offset by a $0.25 per share decrease due to the cash dividend declared and paid during Q3, a $0.14 per share decrease due to net investment loss and a $0.03 per share decrease from the impact of the issuance of common stock during the quarter.

During Q3, we sold 1,230,984 shares under the ATM program at a weighted average price of $8.78 per share for gross proceeds of approximately $10.8 million and net proceeds of approximately $10.6 million after deducting commissions to the agents on shares sold. As of quarter end, up to approximately $88 million in aggregate amount of the shares remain available for sale under the ATM program. At September 30, 2025, and currently, there are 25,119,091 shares of the company's common stock outstanding.

Regarding our liquidity as of quarter end. We had approximately $58.3 million of liquid assets, including approximately $54.6 million in cash and approximately $3.7 million in unrestricted public securities. Not included in our unrestricted public securities are approximately $41.9 million of public securities subject to lockup or other sales restrictions as of quarter end. This represents our investment in CoreWeave via our Class A interest of CW Opportunity 2 and our currently restricted public common shares of GrabAGun.

Next, I'd like to provide more detail on the recent Board-approved updates to the note repurchase program and the share repurchase program. On October 29, SuRo Capital's Board of Directors approved an extension of the discretionary note repurchase program, which allows us to repurchase up to an additional $40 million, or the remaining aggregate principal amount of our 6% notes due 2026 through open market purchases, including block purchases, in such a manner as will comply with the provisions of the Investment Company Act of 1940, as amended, and the Securities Exchange Act of 1934, as amended.

As Mark mentioned earlier, SuRo Capital is committed to initiatives that enhance shareholder value. As such, on October 29, our Board of Directors authorized an extension of the company's discretionary share repurchase program until the earlier of October 31, 2026, or the repurchase of $64.3 million in aggregate amount of the company's common stock. The dollar value of shares that may yet be purchased by the company under the share repurchase program is approximately $25 million.

Since the inception of the share repurchase program in August 2017, we have repurchased a total of 6 million shares of our common stock for a total deployment of approximately $39.3 million of the $64.3 million authorized by the Board. Approximately $25 million remain authorized under the share repurchase program now set to expire on October 31, 2026.

Finally, I'd like to conclude with additional commentary on our recent dividend declaration. On July 3, SuRo Capital's Board of Directors declared a cash dividend of $0.25 per share paid on July 31 to the company's common stockholders of record as of the close of business on July 21. This dividend was generally attributable to the successful monetization of public securities and other promising developments in our investment portfolio.

Subsequent to quarter end, on November 3, SuRo Capital's Board of Directors declared a cash dividend of $0.25 per share payable on December 5 to the company's common stockholders of record as of the close of business on November 21. The date of declaration and amount of any dividends or distributions, including any future distributions are subject to the sole discretion of SuRo Capital's Board of Directors. The aggregate amount of distributions declared and paid by SuRo Capital will be fully taxable to stockholders. The tax character of SuRo Capital's distributions cannot be finally determined until the close of SuRo Capital's taxable year, which is December 31. SuRo Capital will not report the actual tax characteristics of each year's distributions annually to stockholders. Will report the characteristics of each year's distributions annually to stockholders and the IRS on Form 1099-DIV subsequent to year-end.

As a result of the $0.25 per share cash dividend paid on July 31 to stockholders of record as of the close of business on July 21, effective as of July 21, the conversion rate applicable to the 6.5% convertible notes due 2029 was adjusted to $7.53 per share or 132.7530 shares of the company's common stock for $1,000 principal amount of the 6.5% convertible notes due 2029, from the initial conversion price of $7.75 per share or 129.0323 shares of the company's common stock for $1,000 principal amount of the 6.5% convertible notes due 2029, which had been effective since issuance.

The adjustment to the conversion rate of the 6.5% convertible notes due 2029 was made pursuant to the note purchase agreement governing the 6.5% convertible notes. The conversion rate will again be adjusted for the most recently declared dividend pursuant to the note purchase agreement and effective as determined by the note purchase agreement. That concludes my comments. We would like to thank you for your interest and support of SuRo Capital.

Now I will turn the call over to the operator to start the Q&A session. Operator?

[Operator Instructions] We will take our first question from Brian McKenna, Citizens.

So just a few questions on a couple of your largest investments. So on CoreWeave, it looks like you sold another $7 million thus far in the fourth quarter. What's the remaining fair value on that investment as it stands today? And then is there a way to think about the time line around monetizing the rest of CoreWeave? And then just on WHOOP, it's great to see this got marked up again. Fair value is approaching $30 million. You've probably made 2.5x plus on your investment. So what's been driving the strong outperformance here in the markups? And then is there any way to think about a potential IPO of that company?

Great questions, Brian. Thank you. Let me -- WHOOP is -- we'll do first. WHOOP continues to perform quite well in all metrics. WHOOP also trades fairly actively in secondary markets. So it's their increased positive performance in their financial performance as well as some of the other trading in the company, have led to valuation changes. As far as an IPO in WHOOP, I don't know when they would IPO or when they would raise another round of capital.

As you may note, one of its competitors, Oura raised money at an $11-plus billion valuation, which is considerably higher than what we're looking at as valuation for WHOOP. In respect to CoreWeave, the fair value of our investments as of 9/30 is about $37 million. And this has been monetized over time by the manager of the CW Opportunity Fund, and their monetizations can be tracked by their Form 4 filings. Thank you. And thank you for your support, Brian.

We will take our next question from Marvin Fong, BTIG.

Maybe just a couple on, I guess, under the topic of portfolio management here. But as you -- as the CoreWeave position gets sold down, what's sort of the way you'd like to manage the portfolio in terms of your AI exposure? I mean now that WHOOP could potentially be like -- well, it wouldn't be given where OpenAI is prospectively going to be marked at. But just aggregating all of your AI compute and data and infrastructure investments, is there a thinking that you'd like to keep that as the majority of the portfolio or anything like that? Just curious how we should kind of think about deploying additional capital into the AI space.

Thanks, Marvin. And again, thanks for your ongoing interest and support. You're correct. Our ongoing monetization of side of CoreWeave outside of the equation, obviously, the increased value of OpenAI and what that could look like at $500 billion or now the talked about $1 trillion would make the size of that investment way disproportionate in our portfolio. We continue to spend a lot of time in AI infrastructure space, in the application area, in the AI overlay over -- in existing software companies, and we will continue to do so.

I think some of the other areas that we are spending time are in the cybersecurity area, where we find that there's a lot of interesting companies that have increased in value, but probably not at the rate of some of the AI companies. So hopefully, that answers your question.

There are no questions on the line. I will hand over back to your host for the closing remarks.

Well, thank all of you for spending time with us this afternoon. Obviously, the markets have been a bit volatile today. I appreciate your thoughts, your ongoing support. As always, I'm available to chat with any of you. Feel free to give me a call or send an e-mail through our IR portal. We are extremely excited about our portfolio. Hopefully, that came through in our call today. It's been a great year, and we do actually anticipate this success not only to continue but accelerate as we look into 2026. Again, thank you all very much.

Thank you for joining today's call. You may now disconnect.