Greetings. Welcome to the SWK Holdings Fourth Quarter 2024 Conference Call. At this time, all participants are in a listen-only mode. A question-and-answer session will follow the formal presentation. Please note, this conference is being recorded. I will now turn the conference over to your host, Susan Xu, Investor Relations. You may begin.

Thank you. Good morning, everyone, and thank you for joining SWK Holdings' fourth quarter 2024 financial and corporate results call. Yesterday, SWK Holdings issued a press release detailing its financial results for the three months ended December 31, 2024. The press release can be found in the Investor Relations section of swkhold.com under News Releases. Before beginning today's call, I would like to make the following statement regarding forward-looking statements. Today, we will make certain forward-looking statements about future expectations, plans, events, and circumstances, including statements about our strategy, future operations, and our expectations regarding our capital allocation and cash resources. These statements are based on our current expectations, and you should not place undue reliance on these statements. Actual results may differ materially due to our risks and uncertainties, including those detailed in the Risks and Uncertainties Factors section of SWK Holdings' 10-K filed with the SEC and other filings we make with the SEC from time to time. SWK Holdings disclaims any obligation to update information contained in these forward-looking statements, whether as a result of new information, future events, or otherwise. Joining me from SWK Holdings on today's call is Jody Staggs, President and CEO; and Adam Rice, CFO, who will provide an update on SWK's fourth quarter 2024 corporate and financial results. Jody, go ahead.

Thank you, Susan, and thanks, everyone for joining our fourth quarter conference call. We are pleased with SWK's fourth quarter performance, and the company enters 2025 on solid footing. Our fourth quarter was highlighted by solid financial performance, including $8.2 million of finance segment net income, improvement in the portfolio's credit quality, and $44 million of capital deployed into yielding finance receivables to life science companies. Our non-GAAP tangible financing book value per share increased 8% year-over-year to $21.15, and with shares trading at a discount to book, and given our excess capital, we have been active purchasers of our shares having repurchased approximately 100,000 shares for $1.6 million since September 30, 2024. During the fourth quarter, we closed an up to $8 million senior secured term loan to Triple Ring Technologies, upsized the loan to $30 million and advanced a cumulative $10.6 million to four performing borrowers. In January, we closed an up to $15 million term loan with Impedimed with $10 million advanced at close. These are all core SWK financings to commercial stage life science companies. Each is either public and has demonstrated the ability to raise capital or private with a supportive sponsor. Since we last spoke, three SWK finance receivables were repaid at premiums to the GAAP carrying value. In December, Veru made a $4.2 million payment to fully satisfy the FC2 royalty. The FC2 royalty generated a 45% IRR and a 2.7x MOIC. In December, MolecuLight made a final payment totaling $12.2 million to repay its term loan to SWK. The MolecuLight term loan generated a 20% IRR and a 1.6x MOIC. SWK continues to hold equity in MolecuLight, which is carried at zero on our books. In March, ANI Pharma made a $17.25 million payment to exercise an option to buy out the Iluvien royalty. The Iluvien royalty generated a 20% IRR and a 1.8x MOIC. At December 31, 2024, we had $13.8 million of gross finance receivables on non-accrual. The non-accrual receivables have a 15% CECL reserve; thus, our net non-accrual totaled $11.7 million. This morning, we announced the signing of a transaction to sell our remaining performing royalty portfolio for $34 million. The deal is expected to close in approximately two weeks. In combination with the Iluvien buyout, the $51.3 million of proceeds from the two monetization transactions is approximately $1 million more than the carrying value at December 31, 2024. Upon closing of the transaction, we also expect to close out a Japanese yen hedge, which will free up an additional $4.5 million of cash. Pro forma for these changes as well as a $3 million principal repayment from 4Web in the first quarter of 2025 and using the 12/31/2024 balances. Our go-forward gross portfolio consists of approximately $218 million of performing loans, $14 million of non-accruals, and approximately $5 million of equities and warrants. Our fourth quarter 2024 portfolio effective yield was 15.5%. The effective yield is a yield assuming all financial receivables pay as modeled. This figure is not adjusted for the post-quarter changes but should be in the neighborhood of the go-forward portfolio yield even considering the royalty sale. Finally, as of yesterday, our cash totaled over $30 million, and we have no borrowings under our revolver. Assuming closing of the final royalty transaction and release of the FX hedge, our gross cash will total nearly $70 million. We anticipate the Board will declare a dividend on the closing of the final royalty transaction. Turning to our Enteris CDMO division, which has been rebranded as MOD3 Pharma to signify its transformation into a pure-play CDMO business. We are pleased with MOD3's 2024 results as segment division revenue totaled $3.6 million, tripling from $1.2 million in 2023. We expect continued growth in 2025, and the team is focused on positioning the business for unsubsidized profitability by year-end. We are in regular contact with our strategic partner and believe they are pleased with MOD3’s performance. With that, I will turn the call to our CFO, Adam Rice to review the quarter's financial results.

Thank you, Jody, and good morning, everyone. Yesterday, we reported earnings for the fourth quarter of 2024. We reported GAAP pretax net income of $8.6 million, or $0.70 per diluted share. Our reported net income for the fourth quarter of 2024 was $5.9 million after accounting for income tax expense of $2.7 million. This included a $1.1 million increase in revenue from the Finance Receivables segment and a $1.3 million increase from the Pharmaceutical Development segment. The increase in Finance Receivables revenue was largely driven by a $2.3 million rise in interest and fees from newly funded loans and royalties. However, this increase was partially offset by $900,000 due to two investments entering a non-accrual status this year. As of December 31, 2024, our GAAP book value per share was $23.45, reflecting a 5% increase from $22.33 on December 31, 2023. Additionally, the non-GAAP tangible finance book value per share was $21.15 as of December 31, 2024, an 8.3% increase from $19.53 as of December 31, 2023. Overall operating expenses, which encompass interest expense, pharmaceutical manufacturing, research and development costs, general and administrative expenses, and provision for credit losses, totaled $6.6 million in the fourth quarter of 2024, down from $6.8 million in the same quarter of 2023. MOD3 operating expenses were $1.6 million in the fourth quarter 2024 compared to $1.8 million in the same quarter in 2023, while Finance Receivables segment operating expenses were $5.3 million in fourth quarter 2024 compared to $5.6 million in fourth quarter 2023. Breaking down Finance Receivable operating segment expenses for the fourth quarter 2024, we had general and administrative expenses of $2.1 million, provision for credit losses of $2 million, and interest expense of $1.2 million. For the fourth quarter of 2023, the figures were general and administrative expenses of $2.1 million, provision for credit losses of $2.4 million, and interest expense of $1.1 million. The decline in Finance Receivables segment operating expenses was primarily due to a $400,000 drop in provision for credit losses, largely attributed to the strategic exit of three non-accrual investments during the quarter. Regarding our share repurchase program, we repurchased approximately 50,000 shares at a cost of $800,000 during the quarter. Since the end of the quarter, we have bought back an additional 47,000 shares for an additional cost of $800,000. Lastly, for financial reporting purposes, we have moved the MOD3 segment to held for sale as of December 31, 2024. This transition was based on GAAP criteria and relates to a purchase option agreement made with a strategic partner effective January 1, 2024. With that, I will hand it back to Jody.

Thank you, Adam. We entered 2025 with a healthy loan portfolio yielding in the mid-teens as well as $30 million of gross cash. The sale of our remaining performing royalty portfolio and closeout of the FX hedge will add an additional $39 million of cash to our balance sheet, and we anticipate declaring a dividend on the closing of the final royalty transaction. Our MOD3 CDMO division is self-sufficient in working with our strategic partner to address the sizable need for Phase I and Phase II nasal CDMO services. With that, let's open the call to questions.

Absolutely. At this time, we will be conducting a question-and-answer session. The first question comes from Scott Jensen, Private Investor. Please proceed.

Hi. Good morning, Jody and team. Congratulations on so much progress since we last spoke.

Thank you.

I got a couple of questions for you. When you're thinking about a dividend, since it's such a large pile of cash, are you thinking about ongoing dividend or a special dividend, returning some of that cash pile to shareholders?

Yeah, Scott. Thanks. So the Board is still considering our options. I would anticipate initially a one-time special dividend. That doesn't mean that there might not be additional special dividends in the future. But at this time, I don't anticipate a recurring dividend.

Yeah. Love it. That's what I would hope for as well. Second, as far as the buyback, where are you on the current buyback? And then again, if that could be something the Board is going to consider about renewing or increasing the buyback?

Adam, if you have the email ready, please check how much room we have on our buyback. We do have sufficient capacity for it. Navigating the blackout period has been interesting since once we enter it, the algorithm takes charge, limiting our control over the share repurchase volume. Outside of the blackout period, we have the flexibility to be more or less aggressive. We remain active in repurchasing our shares, especially considering that the shares are currently trading at a 20% discount based on the news we announced today, which we see as a good use of our capital. We should be out of the blackout period around May 15 when we report the first quarter, and the buyback program will likely expire around that time. Although we haven't discussed it yet, I believe the Board sees the buyback as an attractive capital use, and I expect that they will seriously consider reauthorizing the program for another year, assuming all other conditions remain the same.

Excellent. Thank you. And I just also want to say congratulations on all those workouts BIOLASE, etc. Those were excellent and cleaning it up.

Thank you, Scott.

I’ll get out of the queue and see if somebody else, but keep up the good work and thank you, again. And love reading the progress.

Thank you. Appreciate the support.

Okay. We have no further questions in the queue. I would like to turn the floor back to Jody for any closing remarks.

Thanks, John. Thank you for joining us today and for your continued support of SWK. We hope everyone has a great day. Thanks.

This concludes today's conference, and you may disconnect your lines at this time. Thank you for your participation.