Daniel Margolis
About Daniel Margolis
Daniel Margolis is General Counsel of Ellington Credit Company (EARN) and has served in this role since April 2013; he previously served as Secretary from inception to April 2013 . He is also General Counsel of Ellington Management Group (EMG) and of Ellington Financial Inc. (EFC) since July 2010, with responsibility for advising on all legal, regulatory, compliance, documentation, and litigation matters . Margolis is 51, holds a J.D. from NYU School of Law (cum laude) and a B.A. from Binghamton University (magna cum laude, highest honors in Political Science, Phi Beta Kappa), and received the DOJ’s John Marshall Award in 2004 for excellence in legal performance during his service as an Assistant U.S. Attorney (SDNY) from 2000–2004 . He signed EARN’s 2025 definitive proxy as General Counsel, underscoring his role in governance and the company’s April 1, 2025 conversion to a Delaware statutory trust and registered closed-end fund focused on CLOs .
Past Roles
| Organization | Role | Years | Strategic impact |
|---|---|---|---|
| Ellington Management Group, L.L.C. (EMG) | General Counsel | Jul 2010–present | Advises EMG on all legal, regulatory, compliance, documentation, and litigation matters . |
| Ellington Credit Company (EARN) | General Counsel | Apr 2013–present | Fund GC; governance/signatory on 2025 proxy; legal stewardship through conversion . |
| Ellington Financial Inc. (EFC) | General Counsel | Jul 2010–present | GC of public affiliate; broad legal oversight in credit platforms . |
| Pillsbury Winthrop Shaw Pittman LLP | Partner | 2007–2010 | Represented corporations/individuals in criminal/regulatory investigations and complex civil litigation . |
| Wilmer Cutler Pickering Hale and Dorr LLP | Junior Partner | 2004–2007 | Represented corporations/individuals in white‑collar/regulatory matters . |
| U.S. Attorney’s Office, SDNY | Assistant U.S. Attorney | 2000–2004 | Prosecuted securities/investment/tax fraud and money laundering; DOJ John Marshall Award (2004) . |
External Roles
| Organization | Role | Years | Notes |
|---|---|---|---|
| Ellington Management Group, L.L.C. (EMG) | General Counsel | Jul 2010–present | Primary legal adviser to EMG; overlapping responsibilities with EARN’s Adviser/Administrator . |
| Ellington Financial Inc. (NYSE: EFC) | General Counsel | Jul 2010–present | Public company legal leadership within Ellington platform . |
Fixed Compensation
EARN is externally managed; its executive officers are employed by EMG and do not receive direct cash compensation from the Fund. As such, EARN does not have salary/bonus agreements with its named executive officers, and executives are not required to devote a specific percentage of time to EARN .
| Metric | Disclosure |
|---|---|
| Employment relationship | Executive officers (including GC) are employed by EMG; EARN does not pay their cash compensation . |
| Base salary | Not disclosed by EARN; the Fund does not pay cash compensation to its executive officers . |
| Target/actual bonus | Not disclosed by EARN; the Fund does not pay cash compensation to its executive officers . |
| Fund-paid benefits | None directly to executives; administrative personnel costs are reimbursed to Administrator post‑conversion on an allocable basis . |
Performance Compensation
EARN does not disclose any Fund‑level RSUs, PSUs, options, or incentive pay for Margolis. Following the April 2025 conversion, in accordance with the 1940 Act, the Fund will not grant restricted common share awards to any trustee, officer, or employee, and its 2023 Equity Incentive Plan was terminated prior to conversion .
| Incentive element | Terms for Margolis |
|---|---|
| Fund equity awards (RSUs/PSUs/options) | None disclosed for Margolis; post‑conversion the Fund will not grant restricted share awards to officers . |
| Bonus metrics/payouts | None disclosed at the Fund level for Margolis . |
| Vesting schedules | None disclosed for Margolis . |
Manager fee structure (indirect incentive context)
| Component | Terms |
|---|---|
| Base management fee | 0.375% per quarter (1.50% per annum) of NAV, payable to the Adviser; aligns with NAV rather than gross assets . |
| Performance fee | 17.5% of Pre‑Performance Fee Net Investment Income with a 2.00% quarterly (8% annual) hurdle and 100% catch‑up; calculated quarterly in isolation; no clawback/accumulation . |
| Additional details | Because the fee excludes realized/unrealized gains/losses, the Adviser could earn a performance fee even when GAAP net loss occurs; quarterly isolation can reduce the hurdle if NAV declines . |
| Temporary waiver | Adviser waived performance fees through the first quarter of 2025/January 2025, per disclosures . |
Equity Ownership & Alignment
| Item | Status |
|---|---|
| Beneficial ownership (dollar range) | None (no reported dollar range of Fund equity for Margolis as of April 10, 2025) . |
| Pledging/hedging | No pledging or hedging disclosed for Margolis in the share ownership and related sections of the proxy . |
Employment Terms
| Term | Disclosure |
|---|---|
| EARN start date | General Counsel since April 2013; Secretary from inception to April 2013 . |
| Employer of record | EMG (services provided to EARN via Adviser/Administrator/Services Agreement) . |
| Contract term/expiration | EARN has no cash compensation agreements with its NEOs and does not intend to enter such agreements; executive officers are not required to devote a specific percentage of time to EARN . |
| Severance/COC with EARN | Not disclosed at the executive level; the Investment Advisory Agreement (manager‑level) has no termination fee, unlike the prior Management Agreement . |
| Roles at Adviser/Administrator | Margolis serves as an officer of the Adviser and Administrator as well as EARN’s GC . |
| Affiliate transaction safeguards | Post‑conversion, the Fund is subject to 1940 Act restrictions prohibiting certain transactions with affiliates absent exemptive relief . |
Performance & Track Record
- Corporate transformation: EARN completed its April 1, 2025 conversion to a Delaware statutory trust and registered closed‑end fund focused on CLOs; Margolis signed the 2025 proxy as General Counsel, reflecting senior legal stewardship during the transition .
- Background signal: Deep litigation/regulatory background (AUSA SDNY with DOJ recognition; senior roles at WilmerHale and Pillsbury) indicates strong capability managing regulatory/compliance risks in complex credit structures .
Related Party & Governance Considerations
- Role overlap and potential conflicts: Margolis is GC of EMG and serves as an officer of EARN’s Adviser and Administrator, while also serving as EARN’s GC—relationships managed under the 1940 Act and committee oversight; the proxy highlights 1940 Act prohibitions on certain affiliate transactions post‑conversion .
- Committee structure: Post‑conversion governance is under 1940 Act standards; independent trustees oversee audit and nominating/governance; prior Compensation Committee was dissolved in 2025 .
Investment Implications
- Alignment: No reported personal stake (dollar range “None”) and no Fund‑level incentive equity for Margolis post‑conversion reduce direct ownership alignment; however, as an EMG executive, his incentives are more closely tied to the Adviser’s fee economics rather than EARN equity .
- Incentive risk: The Adviser’s performance fee is based on pre‑performance‑fee net investment income with quarterly isolation and no clawback; per disclosures, this can be earned even when GAAP net losses occur, potentially skewing incentives toward income‑heavy strategies and leverage subject to 1940 Act limits—an area for board and investor monitoring .
- Retention/time allocation: EARN has no executive employment agreements and does not require executives to devote a specific percentage of time to the Fund, which can diffuse attention across the broader EMG platform—mitigated by EMG’s scale and shared services but still a consideration for execution risk .
- Conflict safeguards: The 1940 Act’s affiliate transaction restrictions and independent board oversight provide structural guardrails around related‑party dynamics (Advisory/Administration/Services Agreements), which is constructive given Margolis’s overlapping roles .