Ellington Credit Company (EARN) Proxy Filing summary

Executive summary

• A special shareholder meeting is scheduled for January 17, 2025, to approve key steps in a strategic transformation, including a shift to a CLO-focused investment strategy, a change in legal form, and a new investment advisory agreement.

• The company has transitioned from a REIT to a taxable C-Corporation and plans to convert to a registered closed-end fund (RIC) subject to shareholder approval.

• The transformation aims to enhance risk-adjusted returns, reduce volatility, and improve access to capital markets.

• The company’s name has changed to Ellington Credit Company, with continued NYSE listing under the ticker EARN.

Voting matters and shareholder proposals

• Four proposals are up for vote: (1) change legal form to a Delaware statutory trust, (2) approve an amended and restated declaration of trust, (3) approve a new investment advisory agreement, and (4) ratify PwC as auditor for 2025.

• Approval of all three “Conversion Proposals” is required to proceed with the strategic transformation.

• Preferred shares with super-voting rights were issued to amplify the voting power of common shareholders who vote, but votes must mirror the proportion of common shares cast.

• The board unanimously recommends voting FOR all proposals.

Board of directors and corporate governance

• The board has six trustees, with authority to set the number between one and fifteen.

• Trustees may be removed for cause by a two-thirds shareholder vote or by a majority of remaining trustees.

• The new trust documents align governance with Delaware statutory trust law and the 1940 Act, enhancing shareholder rights and protections.