Good day, ladies and gentlemen, and thank you for standing by. Welcome to the SuRo Capital's Fourth Quarter and Fiscal Year 2021 Earnings Conference Call. [Operator Instructions] As a reminder, this call is being recorded today, Wednesday, March 9, 2022. I would now like to turn the conference over to Mr. Adam Bates of SuRo Capital. Please go ahead.

Thank you for joining us on today's call. I am 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 & 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 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 COVID-19 and 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. 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'd like to turn the call over to Mark Klein.

Thank you, Adam. Good afternoon and thank you for joining us. We are pleased to share the results of SuRo Capital's fourth quarter and fiscal 2021. 2021 was a momentous year for SuRo Capital as we achieved many milestones as a firm. We reached our highest ever NAV per share, our highest dividend-adjusted NAV per share and our highest year-end net assets under management in firm history. We were able to take advantage of the strong demand for high-growth technology businesses as well as a strong IPO market and M&A environment to monetize over $258 million of our portfolio assets. As a result, we had the most successful year for shareholders in our history, declaring a total of $8 per share, equating to over $212 million in total distributions. To put that quantum of dividends in perspective, our share price at the beginning of the year was $13.02, and our NAV was approximately $302 million. On a percentage basis, our 2021 gains equates to 70% of our NAV and approximately 61% of our share price at the beginning of the year. In addition to the monetization and distribution activities during 2021, we were also able to access the nonconvertible debt markets for the first time, raising $75 million of 6% notes. This capital raise, in addition to the funds we've retained after our sales, gives us the capital to take advantage of opportunities given the dislocation in both the public and private markets. As we have discussed, we felt by late summer, the private and public markets getting a bit frothy. We made it clear to you that we did not intend to immediately deploy the capital derived through our sales and our debt interest issuance, and instead believe there would be better opportunities in the future. We made investments…

Thank you, Mark. I would like to follow Mark's update with a more detailed review of our fourth quarter investment activity and financial results as of December 31, 2021, including dividends declared, the 6% notes due 2026 and our current liquidity position. First, I will review our investment activity. During the fourth quarter, we invested a total of $11 million in new and follow-on investments. New investments during the fourth quarter include: a $10 million follow-on investment in the Series C preferred shares of Course Hero and a $1 million investment in the Series Seed-4 preferred shares of Rebric doing businesses compliable through our SuRo Capital Sports vehicle. During the fourth quarter, we sold our remaining position in the public shares of Coursera and began selling our public shares of NewLake Capital Partners and Skillsoft as restrictions on those 2 holdings had been lifted. We sold our remaining 1,509,090 public common shares of Coursera at an average sale price of $34.35 per share for approximately $51.8 million of net proceeds, resulting in a net realized gain of approximately $42.4 million. We sold 167,755 shares of NewLake Capital Partners, formerly GreenAcreage Real Estate Corp for approximately $4.7 million of net proceeds and $1.4 million of net realized gains. We sold 18,157 shares of Skillsoft for approximately $200,000 of net proceeds, resulting in a net realized gain of approximately $47,000. In addition to sales of our unrestricted publicly traded investments, we also received approximately $2.9 million related to the exit of our investment in Tynker, resulting in a net realized gain of approximately $2.6 million, including approximately $400,000 currently held in escrow. During 2021, we exited or received proceeds from investments of over $259 million, not including investment income received. This resulted in realized gains of over $218 million. During 2021, we…

[Operator Instructions] And we'll take our first question from Mark Palmer with BTIG.

Congratulations on the really strong 2021. Now we had already seen weakness in the tech markets, particularly on the public side, at the latter part of 2021 and then heading into 2022. Now as you said during your prepared remarks, we have the addition of geopolitical-driven volatility. Can you talk a little bit about what you're seeing in the private markets relative to the public markets? I know as you've said before, there has been a gap there. Has that gap shrunk to any extent? Has there been any impact from the ongoing weakness in the public market and all the other exogenous factors, geopolitical, inflation, et cetera?

That's a great question, Mark. And first of all, thank you for your ongoing support, and obviously, your insights in all things, Web 3.0 and metaverse is greatly, greatly appreciated. So I wanted to say thank you. In respect to your question, as in any markets, you have this sort of disconnect of what people think something is worth because it was worth that at some point in time and what folks are willing to pay for it. And we started to see that as we were coming through the end of Q4, and it's continued in Q1. What we have seen, and I think this is pretty well documented, is term sheets are being restruck, term sheets are being pulled. Rounds - that where companies thought they would do another round at a higher value, they're now coming as extensions of prior rounds or they're flipping to some sort of convertible securities. So you're seeing broadly - and there's obviously exceptions for what would be considered maybe outstanding companies or highly coveted companies. But broadly, you're seeing that sort of weakening in the marketplace, which is a bit of price concessions by issuers and changing of the types of securities in order to try to maintain prior valuations. Thank you very much.

We'll take our next question from Kevin Fultz with JMP Securities.

In your prepared remarks, you talked about a strong pipeline of investment opportunities. Can you talk a bit more about how you think about deploying capital in the current environment risk-off and derating? Do you look at it as a potential opportunity to lean into investment activity a bit more at more attractive valuations? Just curious if you could talk about the opportunities that you're seeing right now.

Sure. And thank you, Kevin, and your team also being so supportive of us. Look, I mean, we've been pretty clear over the last period of time probably since sometime in late Q3 when we started looking to analysts and investors as well as investor calls that we felt the markets were getting expensive, and we'd clearly pulled back. We pulled back through Q4 and the early part of this year. We are here to invest investors' capital. We're not here to have a big cash balance, but we're here to be selective and judicious. We are seeing at least the same amount on a quantum of names come through our system, through our process. We're - but we're still not seeing the valuation give up on a lot of names that make some of these compelling, but we are very, very active in the marketplace and would naturally start to lean in as valuations started to break and come back more in line with sort of where the public is right now and maybe a little less frothy. So thank you.

We'll take our next question from Alex Paris with Barrington Research.

My congratulations as well for the strong 2021. I get it, and I appreciate your cautious view with regard to new investments in this environment. Just wondering what your thoughts are with regard to share repurchases, putting some of that money to work and buying your stock below NAV, particularly since during the fourth quarter, the Board extended the program - the term of the program to October, $40 million.

Alex, and again - and thank you for your ongoing support for us. You know us well enough to know that we're very hyper-focused on shareholder value - creating shareholder value. We've used a buyback and even a Dutch tender offer in the past. We will - if the disconnect on our share price versus our NAV starts to be meaningful, we will, of course, deploy - we always have in the past, and we will continue to utilize a buyback as a way to - for accretion for our shareholders and help to create shareholder value. So we clearly have that tool - as a tool in our toolbox, which we have used for years, and we will do that again if there's - the opportunity presents itself. So thank you.

We'll take our next question from Lou Greif with Morgan Stanley.

Quick question. Course Hero - could you give us some more color? I mean, obviously, they just raised another round recently. And what their thoughts are in terms of kind of monetization? Is that a 2022 event, 2023 event? Any thoughts?

Sure. And Lou, thanks and thank you also for your ongoing support for us. Look, Course Hero is a spectacular company. The management is really strong. The Board of Directors is very focused on helping them to drive the value that they're trying to create. I think they're very thoughtful of - on how they want to proceed. Obviously, they raised an awful lot of capital at the end of last year. It puts them almost at the top of the pile with the ability to use cash to make acquisitions, to use their currency to make acquisitions. So I don't know their timetable to create a monetization event, but they have certainly now gotten to the scale at the last round and with their capital and with their acquisition strategy to consider alternatives for themselves in the coming period of time. Thank you.

Thank you. And that does conclude today's question-and-answer session. I'd like to turn the conference back over to management for additional or closing remarks.

Well, thank all of you for spending the time with us this afternoon. It's greatly appreciated. We did have a very, very strong 2021. But it's 2022 right now, and we have our work cut out for us to continue to drive shareholder value and returns. And we all are working diligently. We do have the capital to deploy and the deal flow to deploy it against. And we look forward to speaking to you after our Q1 earnings release. So thank you very much. Greatly appreciated.

Thank you. That does conclude today's conference. We thank you for your participation, and you may now disconnect.