Annual Report by Investment Company (Form N-CSR)

DIT Annual Report for the Fiscal Year Ended September 30, 2025

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Eagle Point Defensive Income Trust

Annual Report - September 30, 2025

Table of Contents

DIT Annual Report for the Fiscal Year Ended September 30, 2025

Management Discussion of Fund Performance

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Management Discussion of Fund Performance

NOVEMBER 24, 2025

Dear Shareholders:

We are pleased to share our annual report for Eagle Point Defensive Income Trust ("we," "us," "our" or the "Fund") for the fiscal year ended September 30, 2025. We believe the Fund is the first interval fund to invest in Portfolio Debt Securities ("PDS"), an asset class that Eagle Point identified and defined. Since the launch of the Defensive Income Strategy in 2020, Eagle Point has originated and invested in over $8 billion of PDS, providing financing to a range of funds including BDCs, closed-end funds, private credit funds and commercial mortgage REITs. With over $5 billion of AUM in the strategy and an 11-person dedicated investment team focused on PDS, we are among the largest non-bank lenders in the market.

Eagle Point's Defensive Income Strategy originates and invests in PDS, which are primarily debt and preferred equity securities issued by funds and investment vehicles primarily to finance a portion of their portfolios. We believe PDS offer a better, more defensive way to gain exposure to private credit since PDS are collateralized by diverse portfolios of assets and benefit from the equity subordination provided by a borrowing fund's equity investors.

This is in contrast to private credit loans to companies which, by definition, are subject to the idiosyncratic credit risk associated with that company. We believe these are the key reasons why there has never been an impairment on any debt to a BDC.

The Defensive Income Strategy has attracted significant interest from institutional investors due to the high-quality, investment-grade nature of most PDS, coupled with a return profile that meaningfully exceeds that of typical investment-grade corporate credit. The Fund is designed to offer individual investors access to the Defensive Income Strategy, which was previously only available to institutional investors. The Fund commenced operations on July 29, 2024, and shortly thereafter received $100 million of equity capital and an attractive portfolio of PDS that was contributed by one of the Defensive Income Strategy's largest institutional investors, which has been invested in the strategy since December 2021.

The Fund's primary investment objective is to generate high current income, with a secondary objective to generate capital gains. As of September 30, 2025, the Fund had $157 million of total assets invested in 103 investments, 57% of which were investment-grade rated. The Fund had a net asset value of $113 million or $11.35 per share, up from $10.00 per share at the time of the Fund's inception.

Fund Highlights

During the period from the Fund's inception on July 29, 2024, through September 30, 2025, the Fund generated an annualized total return of 13.4%.¹

Fund highlights include:

▪Constructed a portfolio that is 57% investment-grade rated and well balanced between fixed and floating rate exposure, with 60% fixed and 40% floating, as of September 30, 2025.

▪Increased portfolio diversification to 103 investments by September 30, 2025, with a weighted average yield of 10.8%.

DIT Annual Report for the Fiscal Year Ended September 30, 2025

Management Discussion of Fund Performance

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▪Put in place a $50 million revolving credit facility and further strengthened the balance sheet by issuing $35 million of preferred stock through a private placement to an institutional investor, providing additional accretive capital to the Fund that we believe will further enhance returns to investors.

As of September 30, 2025, all of the Fund's assets are performing and no assets are on non-accrual.

DIT Annual Report for the Fiscal Year Ended September 30, 2025

Management Discussion of Fund Performance

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Market Commentary

Credit markets generally performed well over the last year, supported by a resilient US economy and the expectation that the Fed will continue its easing cycle. These factors underpinned sustained demand for income-oriented assets. However, the market did experience a brief period of volatility driven by uncertainty related to global trade in April, the so-called "Tariff Tantrum." The Defensive Income Strategy aggressively capitalized on this opportunity, purchasing PDS in the secondary market at discounted prices, which benefited Fund performance. By September 30, 2025, spreads had fully retraced this widening and were hovering near all-time lows, reflecting investor confidence and strong demand for higher-quality yield.

Looking ahead, while the environment remains constructive, with credit spreads near historic lows and defaults ticking up slightly, we believe investors must be increasingly selective in identifying attractive opportunities in private credit. We believe that by focusing on PDS, the Fund offers a more defensive approach to accessing private credit as compared with traditional direct lending funds.

DIT Annual Report for the Fiscal Year Ended September 30, 2025

Management Discussion of Fund Performance

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About Our Adviser

The Fund's adviser, Eagle Point Defensive Income Management LLC (our "Adviser"), is an affiliate of Eagle Point Credit Management LLC (collectively with the Adviser and certain other affiliates, "Eagle Point"). Eagle Point is an investment manager based in Greenwich, CT, which is focused on private credit strategies in inefficient markets. The Firm uses its time-tested private equity-style approach to investing in credit markets with the objective to deliver strong risk-adjusted returns to its investors. As of September 30, 2025, Eagle Point had over $13 billion of assets under management.²

* * * * *

Management remains keenly focused on continuing to create value for our shareholders. We appreciate the trust and confidence our shareholders have placed in the Fund.

This letter is intended to assist shareholders in understanding the Fund's performance for the period ended September 30, 2025. The views and opinions in this letter were current as of November 24, 2025. Statements other than those of historical facts included herein may constitute forward-looking statements and are not guarantees of future performance or results and involve a number of risks and uncertainties. Actual results may differ materially from those in the forward-looking statements as a result of a number of factors. The Fund undertakes no duty to update any forward-looking statement made herein. Information contained on our website is not incorporated by reference into this shareholder letter, and you should not consider information contained on our website to be part of this shareholder letter or any other report we file with the SEC.

DIT Annual Report for the Fiscal Year Ended September 30, 2025

Notes

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Notes

¹Total return is calculated based on a change in NAV per share between the beginning and end of period NAV per share and assumes distributions paid to shareholders during the period were reinvested in accordance with the Fund's distribution reinvestment plan. Total return does not include upfront sales charges. Performance reflects certain expense limitation and fee waiver arrangements in effect during the periods shown. Absent these arrangements, the Fund's performance would have been lower. Past performance is not indicative of, or a guarantee of, future performance.

²Assets under management represent gross assets, inclusive of committed but undrawn capital, managed by Eagle Point and certain of its affiliates.

DIT Annual Report for the Fiscal Year Ended September 30, 2025

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DIT Annual Report for the Fiscal Year Ended September 30, 2025

Important Information

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Important Information about this Report and Eagle Point
Defensive Income Trust

This report is transmitted to the shareholders of Eagle Point Defensive Income Trust ("we," "us," "our" or the "Fund") and is furnished pursuant to certain regulatory requirements. This report and the information and views herein do not constitute investment advice or a recommendation or an offer to enter into any transaction with the Fund or any of its affiliates. This report is provided for informational purposes only, does not constitute an offer to sell securities of the Fund or a solicitation of an offer to purchase any such securities and is not a prospectus. From time to time, the Fund may have a registration statement relating to one or more of its securities on file with the SEC. Any registration statement that has not yet been declared effective by the SEC, and any prospectus relating thereto, is not complete and may be changed. Any securities that are the subject of such a registration statement may not be sold until the registration statement filed with the SEC is effective.

The information and its contents are the property of Eagle Point Defensive Income Management LLC (our "Adviser") and/or the Fund. Any unauthorized dissemination, copying or use of this presentation is strictly prohibited and may be in violation of law. This presentation is being provided for informational purposes only.

Investors should read the Fund's prospectus and SEC filings (which are publicly available on the EDGAR Database on the SEC website at www.sec.gov) carefully and consider their investment goals, time horizons and risk tolerance before investing in the Fund. Investors should consider the Fund's investment objectives, risks, charges and expenses carefully before investing in securities of the Fund. There is no guarantee that any of the goals, targets or objectives described in this report will be achieved.

An investment in the Fund is not appropriate for all investors. The investment program of the Fund is speculative, entails substantial risk and includes investment techniques not employed by traditional mutual funds. An investment in the Fund is not intended to be a complete investment program. Past performance is not indicative of, or a guarantee of, future performance. The performance and certain other portfolio information quoted herein represents information as of September 30, 2025. Nothing herein should be relied upon as a representation as to the future performance or portfolio holdings of the Fund. Investment return and principal value of an investment will fluctuate, and shares, when sold, may be worth more or less than their original cost. The Fund's performance is subject to change since the end of the period noted in this report and may be lower or higher than the performance data shown herein.

To provide some liquidity to shareholders, the Fund will conduct quarterly repurchase offers for a limited amount of the Fund's shares (at least 5%). The offer to purchase between 5% and 25% of shares outstanding at net asset value on a quarterly basis is a fundamental policy that may not be changed without the vote of the holders of a majority of the Fund's outstanding voting securities. An investment in the Fund is suitable only for investors who can bear the risks associated with the limited liquidity of the Fund's shares and should be viewed as a long-term investment. The Fund's shares will not be publicly traded, and an investor should not expect to be able to sell shares regardless of how the Fund performs.

Neither the Adviser nor the Fund provides legal, accounting or tax advice. Any statement regarding such matters is explanatory and may not be relied upon as definitive advice. Investors should consult with their legal, accounting and tax advisors regarding any potential investment. The information presented herein is as of the dates noted herein and is derived from financial and other information of the Fund, and, in certain cases, from third-party sources and reports (including reports of third-party custodians, collateralized loan obligation collateral managers and trustees) that have not been independently verified by the Fund. As noted herein, certain of this information is estimated and unaudited, and therefore subject to change. We do not represent that such information is accurate or complete, and it should not be relied upon as such.

DIT Annual Report for the Fiscal Year Ended September 30, 2025

Important Information

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Forward-Looking Statements

This report may contain "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Statements other than statements of historical facts included in this report may constitute forward-looking statements and are not guarantees of future performance or results and involve a number of risks and uncertainties. Actual results may differ materially from those in the forward-looking statements as a result of a number of factors, including those described in the Fund's filings with the SEC. The Fund undertakes no duty to update any forward-looking statement made herein. All forward-looking statements speak only as of the date of this report.

DIT Annual Report for the Fiscal Year Ended September 30, 2025

Performance Data

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Performance Data¹

The following graph shows the performance of a $10,000 investment in the Fund's shares and the Bloomberg Investment Grade Corporate Bond Index for the period from July 29, 2024 (the date of the Fund's inception) through September 30, 2025. The performance calculation assumes the purchase of the Fund's shares at the offering price at the beginning of the period (i.e., at the initial net asset value per share and assuming the maximum sales charge of 5.75%) and the repurchase of those shares at net asset value at the end of the period shown. Distributions are assumed, for purposes of this calculation, to be reinvested at the prices obtained under the Fund's distribution reinvestment plan. Performance reflects applicable fee waivers and/or expense limitations in effect, if any, during the periods shown and, in their absence, performance would be reduced. Returns do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the repurchase of Fund shares. For comparative purposes, the performance of an appropriate broad-based securities market index, the Bloomberg Investment Grade Corporate Bond Index, is shown.

Value of $10,000 Invested

Please see footnote disclosure on page 12.

DIT Annual Report for the Fiscal Year Ended September 30, 2025

Summary of Certain Unaudited Portfolio Characteristics

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Summary of Certain Unaudited Portfolio Characteristics

The summary of portfolio characteristics is reflected below as of September 30, 2025:

Portfolio Breakdown³

Dollar amounts in millions.

DIT Annual Report for the Fiscal Year Ended September 30, 2025

Notes

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Notes

¹The index shown herein has not been selected to represent a benchmark for a strategy's performance, but is instead disclosed to allow for comparison of the Fund's returns to that of an appropriate broad-based securities market index. Bloomberg Investment Grade Corporate Bond Index return amounts are calculated with reported data as of November 21, 2024. July 2024 returns included in performance data are for the full month of July 2024, as intra month returns are not available. The performance of an index is not an exact representation of any particular investment, as you cannot invest directly in an index. The Bloomberg Investment Grade Corporate Bond Index is intended to measure the performance of a composite of multi-strategy funds which are characterized by their ability to dynamically allocate capital among strategies falling within several traditional hedge fund disciplines. The use of many strategies, and the ability to reallocate capital between them in response to market opportunities, means that such funds are not easily assigned to any traditional category. The Bloomberg Investment Grade Corporate Bond Index is recalculated and updated in real-time as soon as the monthly returns for the underlying funds are recorded. Only funds that provide net returns are included in the index calculation.

²Calculated based on a maximum sales charge of 5.75%.

³The summary of portfolio investments shown is based on the fair value of the underlying positions as of September 30, 2025. Totals may not foot due to rounding.

DIT Annual Report for the Fiscal Year Ended September 30, 2025

Financial Statements (10.1.2024 - 9.30.2025)

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Financial Statements for the period from October 1, 2024 through
September 30, 2025 (Audited)

See accompanying notes to the financial statements

Eagle Point Defensive Income Trust

Statement of Assets and Liabilities

As of September 30, 2025

(expressed in U.S. dollars)

14

See accompanying notes to the financial statements

Eagle Point Defensive Income Trust

Schedule of Investments

As of September 30, 2025

(expressed in U.S. dollars)

15

See accompanying notes to the financial statements

Eagle Point Defensive Income Trust

Schedule of Investments

As of September 30, 2025

(expressed in U.S. dollars)

16

See accompanying notes to the financial statements

Eagle Point Defensive Income Trust

Schedule of Investments

As of September 30, 2025

(expressed in U.S. dollars)

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⁽¹⁾ Unless otherwise noted, the Fund is neither affiliated with, nor does it "control" (as such term is defined in the Investment Company Act of 1940, as amended(the "1940 Act")), any of the issuers listed. In general, under the 1940 Act, the Fund would be presumed to "control" an issuer if it owned 25% or more of its voting securities.

⁽²⁾ A portion of the investments presented on the schedule of investments are held as collateral pursuant to the Fund's financing arrangements. Refer to Note 7 "Revolving Credit Facility" for further discussion.

⁽³⁾ Acquisition date represents the initial date of purchase or the date the investment was acquired by the Fund.

⁽⁴⁾ Fair value is determined by Eagle Point Defensive Income Management LLC in accordance with written valuation policies and procedures, subject to oversight by the Fund's Board of Trustees, in accordance with Rule 2a-5 under the 1940 Act.

⁽⁵⁾ Country represents the principal country of risk where the investment has exposure.

⁽⁶⁾ Securities exempt from registration under the Securities Act of 1933, as amended, and are deemed to be "restricted securities." As of September 30, 2025, the aggregate fair value of these securities is $134.7 million or 118.6% of the Fund's net assets.

⁽⁷⁾ Variable rate investment. Interest rate shown reflects the rate in effect at the reporting date. Investment description includes the reference rate and spread.

⁽⁸⁾ Fixed rate investment.

⁽⁹⁾ This investment has an unfunded commitment as of September 30, 2025. Refer to Note 10 "Commitments and Contingencies" for further discussion.

⁽¹⁰⁾ Classified as Level III investments. See Note 3 "Valuation of Investments" for further discussion.

⁽¹¹⁾ This investment is an affiliated investment as defined under the 1940 Act, which represents investments in which the Fund owns 5% or more of the outstanding voting securities under common ownership or control. Refer to Note 5 "Related Party Transactions" for further discussion.

⁽¹²⁾ CFO equity investments are entitled to recurring distributions which are generally equal to the remaining cash flow of payments made by underlying assets less contractual payments to debt holders and fund expenses. The effective yield is estimated based on the current projection of the amount and timing of these recurring distributions in addition to the estimated amount of the terminal principal payment. The effective yield and investment cost may ultimately not be realized. As of September 30, 2025, the Fund's weighted average effective yield on its aggregate CFO equity positions, based on current amortized cost, was 33.26%.

⁽¹³⁾ This investment is not an income producing security.

Reference Key:

SOFR Secured Overnight Financing Rate

US CMT United States Constant Maturity Treasury Rate

See accompanying notes to the financial statements

Eagle Point Defensive Income Trust

Statement of Operations

As of September 30, 2025

(expressed in U.S. dollars)

18

See accompanying notes to the financial statements

Eagle Point Defensive Income Trust

Statements of Changes in Net Assets

As of September 30, 2025

(expressed in U.S. dollars)

19

See accompanying notes to the financial statements

Eagle Point Defensive Income Trust

Statement of Cash Flows

As of September 30, 2025

(expressed in U.S. dollars)

20

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Eagle Point Defensive Income Trust

Notes to Financial Statements

September 30, 2025

1.ORGANIZATION

Eagle Point Defensive Income Trust (the "Fund") is a Delaware statutory trust registered under the Investment Company Act of 1940, as amended (the "1940 Act"), as a non-diversified, closed-end management investment company to offer its shares on a continuous basis. The Fund is managed by Eagle Point Defensive Income Management LLC (the "Adviser"), which is registered as an investment adviser with the U.S. Securities and Exchange Commission (the "SEC"), and is subject to the supervision of the Fund's Board of Trustees (the "Board"). An affiliate of the Adviser, Eagle Point Credit Management LLC, provides investment professionals and other resources to the Adviser. The Fund has elected to be treated, and to qualify, as a regulated investment company ("RIC") under the Subchapter M of the Internal Revenue Code of 1986, as amended (the "Code"), for federal income tax purposes.

The Fund's primary investment objective is to generate high current income, with a secondary objective to generate capital gains. The Fund seeks to achieve these investment objectives by focusing on proactively sourcing, structuring and investing primarily in debt and preferred equity securities issued by funds and investment vehicles, such as business development companies, registered closed-end investment companies, unregistered private funds, real estate investment trusts, collateralized fund obligations ("CFOs") and rated feeder funds and similar investment vehicles, to finance a portion of their underlying investment portfolio (collectively, "Portfolio Debt Securities"). Portfolio Debt Securities may also include loans to such issuers. Portfolio Debt Securities may be primary issuances originated by the Adviser or its affiliates or secondary market opportunities. The Fund may also invest in other securities that the Adviser believes, in its discretion, are consistent with the Fund's investment objectives. The Fund commenced its operations on July 29, 2024. The Fund's registration under the 1940 Act was effective as of August 9, 2024.

2.SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of Accounting

The financial statements have been prepared in conformity with U.S. generally accepted accounting principles ("U.S. GAAP"). The Fund is an investment company and follows the accounting and reporting guidance applicable to investment companies in the Financial Accounting Standards Board ("FASB") Accounting Standards Codification ("ASC") Topic 946 Financial Services - Investment Companies. Items included in the financial statements are measured and presented in U.S. dollars.

Use of Estimates

The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions, which affect the reported amounts included in the financial statements and accompanying notes as of the reporting date. The most significant estimate inherent in the preparation of the financial statements is the valuation of the Fund's investments. Actual results may differ from those estimates.

Operating Segments

The Fund has a single reportable segment with investment objectives described in Note 1 "Organization". The chief operating decision maker ("CODM") of the Fund is comprised of the Fund's Chief Executive Officer and Chief Financial Officer.

Key financial information used by the CODM to assess the Fund's performance and make operational decisions - including the Fund's portfolio composition, total return, changes in net assets and expense ratios - is consistent with the presentation within the Fund's financial statements. Segment assets are reflected as "Total Assets" on the accompanying Statement of Assets and Liabilities and significant segment expenses are listed on the Statement of Operations.

Securities Transactions

The Fund records the purchase and sale of securities on the trade date. Realized gains and losses on investments sold are recorded on the basis of the specific identification method.

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Eagle Point Defensive Income Trust

Notes to Financial Statements

September 30, 2025

Cash and Cash Equivalents

The Fund defines cash and cash equivalents as cash and shortterm, highly liquid investments with original maturities of three months or less from the date of purchase. The Fund maintains its cash and cash equivalents in major financial institutions, which may, at times, exceed federal insured limits. The Adviser monitors the performance of the financial institutions where such accounts are held to manage associated risk.

Cash equivalents are carried at cost, plus accrued interest, which approximates fair value. Cash equivalents are held for meeting short-term liquidity requirements, rather than for investment purposes. Cash equivalents are classified as Level I in the fair value hierarchy. As of September 30, 2025, the Fund held no cash equivalents.

Investment Income

Interest Income from Investments

Interest income from debt securities is recorded using the accrual basis of accounting to the extent such amounts are expected to be collected.

Premiums and discounts on debt securities are amortized or accreted, respectively, using the effective interest method and are included in interest income. The Fund applies the provisions of Accounting Standards Update No. 2017-08 Premium Amortization on Purchased Callable Debt Securities ("ASU 2017-08") in calculating amortization of premium for applicable investments.

In certain circumstances, all or a portion of interest income from a given investment may be paid in the form of additional investment principal, often referred to as payment-in-kind ("PIK") interest. PIK interest is included in interest income and interest receivable through the PIK capitalization date. On the capitalization date, the PIK component of interest receivable is capitalized as additional principal in the investment, which is subject to fair value determination, and the PIK interest rate is applied to the entire principal balance of the applicable investment. To the extent the Fund does not believe it will ultimately be able to collect capitalized PIK interest, the investment will be placed on non-accrual status, and previously recorded capitalized PIK interest will be reversed. For the year ended September 30, 2025, the Fund recorded $0.4 million in PIK interest income, which represented 2.8% of the Fund's total interest income for same period, as included on the Statement of Operations.

Investment income from investments in the equity tranche securities of CFO and certain other investments is recognized using the effective interest method, in accordance with ASC Topic 325-40, Beneficial Interests in Securitized Financial Assets. Under the effective interest method, income is recognized based on an effective yield to maturity derived from projected cash flows, and any difference between cash distributed and income amount calculated pursuant to the effective interest method is recorded as an adjustment to the cost basis of the investment. It is the Adviser's policy to review the effective yield of CFO equity and certain other investments at each measurement date and update periodically based on the facts and circumstances known to the Adviser.

Dividend Income

Dividend income from preferred equity securities is recorded using the accrual basis of accounting to the extent such amounts are expected to be collected. Dividend income from common equity securities is recorded on the record date for private portfolio companies or on the ex-dividend date for publicly traded companies.

Expenses, Offering Cost and Deferred Financing and Issuance Costs

Expense Recognition

Expenses are recorded on the accrual basis of accounting.

Offering Costs

Offering costs associated with the issuance of the Fund's shares are capitalized to deferred offering cost on the Statement of Assets and Liabilities and amortized to expense over the twelve-month period following such capitalization on a straight-line basis.

Organizational Expenses

Organizational expenses of the Fund are expensed as incurred.

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Eagle Point Defensive Income Trust

Notes to Financial Statements

September 30, 2025

Interest Expense

Interest expense includes the Fund's distributions associated with the Fund's Series A Term Preferred Shares due 2028 (the "Preferred Shares") and interest amounts due under the Revolving Credit Facility (as defined in Note 7 "Revolving Credit Facility") in relation to outstanding borrowings, unused commitment fees and amortization of deferred financing and issuance costs associated with borrowings.

The following table summarizes the components of interest expense for the year ended September 30, 2025:

Please refer to Note 7 "Revolving Credit Facility" and Note 8 "Mandatorily Redeemable Preferred Shares" for further discussion relating to the interest expense due under the Revolving Credit Facility and the Preferred Shares, respectively.

Deferred Financing and Issuance Costs

Deferred financing and issuance costs consist of fees and expenses incurred in connection with the Revolving Credit Facility and the issuance of Preferred Shares. These costs are capitalized at the time of payment and amortized over the respective terms of the Revolving Credit Facility and Preferred Shares using the straight-line basis, which approximates the effective interest method.

Amortization of deferred financing and issuance costs is recorded as interest expense on the Statement of Operations.

Prepaid Expenses

Prepaid expenses consist primarily of insurance premiums and state registration fees. Insurance premiums are amortized over the term of the applicable policy. State registration fees are amortized over a twelve-month period beginning at the time of payment.

Federal and Other Taxes

The Fund intends to operate so as to continue to qualify to be taxed as a RIC under the Code and, as such, to not be subject to U.S. federal income tax on the portion of its taxable income and gains distributed to stockholders. To qualify for RIC tax treatment, among other requirements, the Fund is required to distribute at least 90% of its investment company taxable income, as defined by the Code. Accordingly, the Fund intends to distribute its taxable income and net realized gains, if any, to stockholders in accordance with timing requirements imposed by the Code. Therefore, no federal income provision is required.

The Fund has adopted November 30th as its fiscal tax year end. The Fund intends to file federal income and excise tax returns as well as any applicable state tax filings. The statute of limitations on the Fund's tax return filings generally remains open for three years. The Fund has analyzed its tax positions for the year ended September 30, 2025, including open tax years, and does not believe there are any uncertain tax positions requiring recognition in the Fund's financial statements.

Because U.S. federal income tax regulations differ from U.S. GAAP, characteristics of distributions may differ for financial reporting and tax purposes. Differences may be permanent or temporary. Permanent differences are reclassified among capital accounts in the financial statements to reflect their tax character. Temporary differences arise when certain items of income, expense, gain or loss are recognized at some time in the future. Differences in classification may also result from the treatment of short-term capital gains as ordinary income for federal income tax purposes. The tax basis components of distributable earnings may differ from the amounts reflected under "aggregate

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Eagle Point Defensive Income Trust

Notes to Financial Statements

September 30, 2025

distributable earnings (loss)" in the Statement of Changes in Net Assets due to temporary book/tax differences arising primarily from the Fund's investments that are classified for tax purposes as partnerships and passive foreign investment companies.

For the year ended September 30, 2025, $0.4 million was reclassified between aggregate distributable earnings (losses) and paid-in capital. This amount represents $0.2 million of non-deductible offering costs and $0.1 million non-deductible U.S. federal excise taxes incurred in relation to the 2024 excise tax year. Additionally, within aggregate distributable earnings (losses) an amount of $0.1 million was reclassified from undistributed net investment income to realized gains. This amount represents return of capital on investments. This difference has no effect on net assets or net asset value ("NAV") per share.

For the tax year ended November 30, 2024, the estimated components of distributable earnings (accumulated loss) reported on the Statement of Assets and Liabilities on a tax basis were as follows:

The following table summarizes the tax character of distributions to common shareholders for the respective tax years. Tax information for the year ended September 30, 2025, is estimated and is not considered final until the Fund files its tax return.

For the year ended September 30, 2025, the estimated components of distributable earnings (accumulated loss) reported on the Statement of Assets and Liabilities on a tax basis were as follows:

*Other timing differences include book/tax differences in the Fund's partnership investments as well as timing differences caused by the difference between book and tax year end.

As of September 30, 2025, net unrealized appreciation (depreciation) of the Fund's investments on a tax basis was as follows:

A subsidiary of the Fund, Eagle Point Defensive Income Trust Sub (US) LLC ("US Sub"), was formed after September 30, 2025. US Sub has elected to be treated as a corporation for U.S. tax purposes and is subject to federal, state and local tax where it operates or is deemed to operate.

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Eagle Point Defensive Income Trust

Notes to Financial Statements

September 30, 2025

Distributions to Shareholders

The composition of distributions paid to shareholders from net investment income and capital gains is determined in accordance with U.S. federal income tax regulations, which differ from U.S. GAAP. Distributions to shareholders can be comprised of net investment income, net realized capital gains and return of capital for U.S. federal income tax purposes and are intended to be paid monthly.

Distributions payable to shareholders are recorded as a liability on the ex-dividend date. Shareholders who participate in the Fund's distribution reinvestment plan (the "DRIP") will have their distributions automatically reinvested in full shares of the Fund as of the payment date pursuant to the DRIP. Shareholders who do not participate in the DRIP generally will receive distributions in cash.

In addition to regular monthly distributions, and subject to the available taxable earnings of the Fund, the Fund may make periodic special distributions representing the excess of the Fund's net taxable income over the Fund's aggregate monthly distributions paid during the year (or for other purposes).

The characterization of distributions paid to shareholders, as set forth in the Financial Highlights, reflects estimates made by the Fund for federal income tax purposes. These estimates are subject to change once final determination of the tax attributes of all distributions has been made by the Fund.

For the year ended September 30, 2025, the Fund declared and paid distributions to common shareholders of $2.4 million or $0.24 per share.

3.VALUATION OF INVESTMENTS

The Fund accounts for its investments in accordance with U.S. GAAP and determines fair values accordance with the provisions of the FASB ASC Topic 820, Fair Value Measurements and Disclosures ("ASC 820"), which defines fair value, establishes a framework for measuring fair value and requires enhanced disclosures about fair value measurements. Investments are reflected in the financial statements at fair value, which represents the price that would be received to sell an asset, or paid to transfer a liability, in an orderly transaction between market participants at the measurement date (i.e., the exit price).

Pursuant to Rule 2a-5 under the 1940 Act, ("Rule 2a-5"), the Board has designated the Adviser as "valuation designee" responsible for performing fair value determinations, subject to Board oversight and certain other conditions. In the absence of readily available market quotations, as defined by Rule 2a-5, the Adviser determines the fair value of the Fund's investments in accordance with its written valuation policy, which has been approved by the Board.

Fair value determinations require the application of judgment to the specific facts and circumstances of each investment. While the Fund applies a consistent valuation process across similar investment types, there is no single method for determining fair value in good faith. Due to the uncertainty in estimating fair value, the values assigned to investments may differ materially from values that would have been used had an active market for the investments existed.

The Adviser determines fair value based on assumptions that market participants would use in pricing an asset or liability in an orderly transaction at the measurement date. When considering market participant assumptions in fair value measurements, the following fair value hierarchy prioritizes and ranks the level of market price observability in measuring investments:

•Level I - Unadjusted quoted prices in active markets for identical assets or liabilities that the Fund is able to access as of the reporting date.

•Level II - Inputs, other than quoted prices included in Level I, that are observable either directly or indirectly as of the reporting date. These inputs may include (a) quoted prices for similar assets in active markets, (b) quoted prices for identical or similar assets in markets that are not active, (c) inputs other than quoted prices that are observable for the asset, or (d) inputs derived principally from or corroborated by observable market data by correlation or other means.

•Level III - Pricing inputs are unobservable for the investment and little, if any, active market exists as of the reporting date. Fair value inputs require significant judgment or estimation from the Adviser.

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Eagle Point Defensive Income Trust

Notes to Financial Statements

September 30, 2025

In cases where inputs used to measure fair value fall into multiple levels of the hierarchy, the classification is based on the lowest level input that is significant to the overall fair value measurement. The assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment and consideration of factors specific to each investment.

Market price observability is impacted by a number of factors, including the type of investment, the characteristics specific to the investment and the state of the marketplace (including the existence and transparency of transactions between market participants). Investments with readily available quoted prices in active market generally require a lesser degree of judgment and have a higher degree of market price observability. Conversely, investments lacking observable market data are valued using Level III inputs, which incorporate the Adviser's own assumptions (including assumptions the Adviser believes market participants would use in valuing investments and assumptions relating to appropriate risk adjustments for nonperformance and lack of marketability), as outlined in the Adviser's valuation policy.

In accordance with ASC 820, the Fund may use NAV as a practical expedient to estimate the fair value of certain investments that do not have a readily determinable fair value. When NAV is used as a practical expedient, those investments are not categorized within the fair value hierarchy.

An estimate of the fair value for each applicable investment is made at least monthly, based on information available as of the reporting date.

Fair Value Measurement

The following tables summarize the valuation of the Fund's investments measured and reported at fair value under the fair value hierarchy levels as of September 30, 2025:

⁽¹⁾Amounts may not foot due to rounding.

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Eagle Point Defensive Income Trust

Notes to Financial Statements

September 30, 2025

Significant Unobservable Inputs

The following table summarizes the valuation techniques and quantitative inputs and assumptions used for investments categorized within Level III of the fair value hierarchy as of September 30, 2025:

⁽¹⁾Weighted average calculations are based on the fair value of investments.

⁽²⁾A range is not presented for asset type categories with one investment.

⁽³⁾Amounts may not foot due to rounding.

Unobservable inputs and assumptions are reviewed at each measurement date and updated as necessary to reflect current market conditions. The table presented is not intended to be all-inclusive, but rather provides information on significant Level III inputs relevant to the Fund's fair value measurements as of the reporting date. In addition to the techniques and inputs outlined in the preceding table, the Adviser may use other valuation techniques and methodologies when determining the fair value of the Fund's investments, as permitted under the Adviser's valuation policy approved by the Board.

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Eagle Point Defensive Income Trust

Notes to Financial Statements

September 30, 2025

Certain of the Fund's Level III investments have been valued using unadjusted inputs not internally developed by the Adviser, including third-party transactions, third-party pricing services, recent market transactions and data reported by trustees. As a result, investments with a fair value of $1.2 million have been excluded from the preceding table due to being valued at recent transacted cost.

Change in Investments Classified as Level III

The following table includes additional information pertaining to financial instruments classified within Level III for the year ended September 30, 2025:

⁽¹⁾Inclusive of PIK interest.

⁽²⁾Amounts may not foot due to rounding.

⁽³⁾There were no transfers into or out of Level III investments during the period.

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Eagle Point Defensive Income Trust

Notes to Financial Statements

September 30, 2025

Net realized gains or (losses) related to Level III investments are reported in the net realized gain (loss) on investments account in the Statement of Operations, if applicable. Net changes in unrealized appreciation or (depreciation) are reported in the net change in unrealized appreciation (depreciation) on investments account in the Statement of Operations.

Fair Value - Valuation Techniques and Inputs

The Adviser has established valuation processes and procedures to ensure the valuation techniques are fair and consistent, and valuation inputs are supportable. Oversight of the valuation process is conducted by the Adviser's Valuation Committee, which is composed of senior personnel from the Adviser or its affiliates, the majority of whom are not involved in the Fund's portfolio management activities. The Valuation Committee is responsible for overseeing the implementation of the Adviser's written valuation policies, which have been approved by the Board, and evaluating the overall fairness and consistency of the valuation process. The Valuation Committee reviews and approves the fair value determinations of the Fund's portfolio investments on a monthly basis.

Exchange-Traded Investments

Exchange-traded investments are fair valued utilizing the official closing price from the applicable exchange as of the measurement date. Due to their observability and active market, the Adviser categorizes such investments as Level I investments.

Investments Not Listed on an Exchange

For investments not listed on an exchange, but for which an active market exists, the Adviser utilizes an independent pricing service. The valuation methodology of the independent pricing service includes incorporating data comprised of observable market transactions, executable bids, broker quotes from dealers with two-sided markets, as well as transaction activity from comparable securities to those being valued. As the independent pricing service contemplates real time market data and no unobservable inputs or significant judgment has been used by the Adviser in the valuation of these investments, such investments are categorized by the Adviser as Level II investments within the fair value hierarchy.

In the absence of an active market, investments not listed on an exchange require the use of unobservable inputs and significant judgment to determine fair value. For such investments, the Adviser engages a nationally recognized independent valuation agent to determine the fair value. The independent valuation agent performs a discounted cash flow analysis, or other valuation technique appropriate for the facts and circumstances, to determine the fair value of such investments, ultimately providing a high and low valuation for each investment. The Adviser generally records the mid-point of the range provided as fair value of the investment, but from time to time may record fair value at a level other than the mid-point. In all instances, the final valuation recorded is within the high and low band provided by the valuation agent. Due to the lack of observable inputs, the Adviser categorizes these investments as Level III investments within the fair value hierarchy.

Valuation of Joint Venture Investments

Joint venture investments consist of common stock and senior unsecured notes issued by a joint venture entity. The Adviser values the common stock using the NAV as a practical expedient, unless it is probable that the Adviser will sell a portion of the investment at an amount different than the NAV. The Fund values the senior unsecured notes at recent transacted cost.

Investment Risk Factors and Concentration of Investments

The following list is not intended to be a comprehensive list of all of the potential risks associated with the Fund. The Fund's prospectus provides a detailed discussion of the Fund's risks and considerations. The risks described in the prospectus are not the only risks the Fund faces. Additional risks and uncertainties not currently known to the Fund or that are currently deemed to be immaterial also may materially and adversely affect its business, financial condition and/or operating results.

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Eagle Point Defensive Income Trust

Notes to Financial Statements

September 30, 2025

Risks of Investing in Certain Pooled Issuers and other Structured Debt Securities

Portfolio Debt Securities and other structured finance securities are generally backed by a pool of credit-related assets that serve as collateral. Accordingly, such securities present risks similar to those of other types of credit investments, including default (credit), interest rate and prepayment risks. In addition, such securities may be governed by a complex series of legal documents and contracts, which increases the risk of dispute over the interpretation and enforceability of such documents relative to other types of investments.

Subordinated Securities Risk

Certain debt securities in which the Fund may invest are subordinated to more senior tranches of debt. Accordingly, such debt securities are subject to increased risks of default relative to the holders of superior priority interests in the same issuer. In addition, certain securities are under-collateralized in that the face amount of the issuer's debt and equity exceeds its total assets. With respect to certain investments, the Fund will be in a first loss or subordinated position with respect to realized losses on the underlying assets held by the issuers of such securities.

High Yield Investment Risk

Certain investments of the Fund are rated below investment grade or unrated. Such securities are sometimes referred to as "high yield" or "junk" securities and are considered speculative with respect to timely payment of interest and repayment of principal. The senior secured loans and other credit-related assets underlying certain investments may also be high yield investments. Investing in such investments involves greater credit and liquidity risk, which may adversely impact the Fund's performance.

Payment-In-Kind and Original Issue Discount

To the extent that the Fund invests in original issue discount instruments, including payment-in-kind loans and zero coupon bonds, investors will be exposed to the risks associated with the inclusion of such non-cash income in taxable and accounting income prior to receipt of cash.

Leverage Risk

The use of leverage, whether directly or indirectly through investments, may magnify the Fund's risk of loss. Certain issuers in which the Fund invests are very highly leveraged and therefore are subject to a high degree of risk of loss.

Credit Risk

The Fund invests primarily in credit and credit-related instruments. Such investments generally fluctuate in value based upon broader market factors, such as changes in interest rates, and also based on developments affecting the perceived creditworthiness and ability of the borrower to repay the principal and interest owed with respect to the underlying indebtedness. If a credit investment in the Fund's portfolio declines in price and/or fails to pay interest or principal when due because the issuer or debtor, as the case may be, experiences a decline in its financial status, the Fund's NAV and/or income would be adversely impacted.

Key Personnel Risk

The Adviser manages the Fund's investments. Consequently, the Fund's success depends, in large part, upon the services of the Adviser, including its affiliate Eagle Point Credit Management LLC, which provides the Adviser with investment professionals and other resources under a personnel and resources agreement and the skill and expertise of the Adviser's professional personnel. There can be no assurance that the professional personnel of the Adviser (or Eagle Point Credit Management LLC) will continue to serve in their current positions or continue to be employed by the Adviser. The Fund can offer no assurance that their services will be available for any length of time or that the Adviser will continue indefinitely as the Fund's investment adviser.

Conflicts of Interest Risk

The Fund's executive officers and trustees, and the Adviser and certain of its affiliates and their officers and employees, including the members of the Senior Investment Committee, have several conflicts of interest as a result of the other activities in which they engage.

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Eagle Point Defensive Income Trust

Notes to Financial Statements

September 30, 2025

Risks of Default on Underlying Assets

A wide range of factors could adversely affect the ability of the issuer of an underlying asset to make interest or other payments on that asset and result in a default by such issuer. Defaults and losses of underlying assets would reduce the Fund's collateral in the investment or otherwise impair the creditworthiness of the Fund's investment. This could have a negative impact on the fair value of the Fund's investment and reduce the cash flows that the Fund receives from its investment.

Prepayment Risk

Investments held by the Fund may be prepaid more quickly than expected. Prepayment rates are influenced by changes in interest rates and a variety of factors beyond the Fund's control and consequently cannot be accurately predicted. Early prepayments give rise to increased reinvestment risk, as the Fund might realize excess cash from prepayments earlier than expected. If the Fund is unable to reinvest such cash in a new investment with an expected rate of return at least equal to that of the investment repaid, this may reduce the Fund's net income and the fair value of that asset.

Liquidity Risk

Generally, there is no public market for many of the Fund's investments. As such, the Fund may not be able to sell such investments quickly, or at all. If the Fund is able to sell such investments, the prices the Fund receives may not reflect the Adviser's assessment of their fair value or the amount paid for such investments by the Fund.

Incentive Fee Risk

The Fund's incentive fee structure and the formula for calculating the fee payable to the Adviser may incentivize the Adviser to pursue speculative investments and use leverage in a manner that adversely impacts the Fund's performance.

Fair Valuation of the Fund's Investments

Generally, there is no public market for many of the investments the Fund targets. As a result, the Adviser values these securities at fair value in accordance with the requirements of the 1940 Act. The Adviser's determinations of the fair value of the Fund's investments have a material impact on the Fund's net earnings through the recording of unrealized appreciation or depreciation of investments and may cause the Fund's NAV on a given date to understate or overstate, possibly materially, the value that the Fund ultimately realizes on one or more of the Fund's investments.

Non-Diversification Risk

The Fund is a non-diversified investment company under the 1940 Act and expects to hold fewer investments than a diversified fund under the 1940 Act.

Market Risk

Political, regulatory, economic and social developments, and developments that impact specific economic sectors, industries or segments of the market, can affect the value of the Fund's investments. A disruption or downturn in the capital markets and the credit markets could impair the Fund's ability to raise capital, reduce the availability of suitable investment opportunities for the Fund or adversely and materially affect the value of the Fund's investments, any of which would negatively affect the Fund's business. These risks may be magnified if certain events or developments adversely interrupt the global supply chain and could affect companies worldwide.

Synthetic Investments Risk

The Fund may invest in synthetic investments, including regulatory capital relief securities and credit risk transfer securities, which are fixed rate or floating rate unsecured general obligations issued by banks or other financial institutions, or acquire interests in lease agreements that have the general characteristics of loans and are treated as loans for withholding tax purposes. In addition to the credit risks associated with the applicable reference assets, the Fund will usually have a contractual relationship only with the counterparty of such synthetic investment, and not with the reference obligor of the reference asset. Accordingly, the Fund will generally have no right to directly enforce compliance by the reference obligor with the terms of the reference asset nor will it have any rights of setoff against the reference obligor or rights with respect to the reference asset. The Fund will not directly benefit from the collateral supporting the reference asset and will not have the benefit of the remedies that would normally be available to a holder

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Eagle Point Defensive Income Trust

Notes to Financial Statements

September 30, 2025

of such reference asset. In addition, in the event of the insolvency of the counterparty, the Fund may be treated as a general creditor of such counterparty and will not have any claim with respect to the reference asset. Consequently, the Fund will be subject to the credit risk of the counterparty as well as that of the reference obligor.

Currency Risk

Although the Fund primarily makes investments denominated in U.S. dollars, the Fund may make investments denominated in other currencies. The Fund's investments denominated in currencies other than U.S. dollars will be subject to the risk that the value of such currency will decrease in relation to the U.S. dollar. The Fund may or may not hedge currency risk.

Hedging Risk

Hedging transactions seeking to reduce risks may result in poorer overall performance than if the Fund had not engaged in such hedging transactions. Additionally, such transactions may not fully hedge the relevant risks.

Interest Rate Risk

Fluctuations in interest rates, whether driven by governmental policy, inflation expectations, or other market factors, could adversely affect the Fund's results, including both the level of cash flows the Fund generates and the market value of its portfolio investments.

Income from the Fund's investments in floating-rate instruments will generally rise or fall with changes in the Secured Overnight Financing Rate ("SOFR") or another applicable benchmark rate.

In a sustained period of elevated interest rates and/or an economic downturn, loan default rates could rise, leading to higher credit losses that may reduce the Fund's cash flow, the fair value of its assets and its operating results. Conversely, a significant decline in interest rates could decrease portfolio income over time as loans reprice at lower coupons.

An increase in interest rates may also negatively affect the value of the Fund's fixed-rate investments, such as high-yield bonds, and could increase the Fund's own financing costs to the extent it issues floating rate debt or refinances fixed-rate debt or preferred equity at higher rates in the future, thereby reducing net investment income.

Refinancing Risk

If the Fund incurs debt financing and subsequently refinances such debt, the replacement debt may be at a higher cost and on less favorable terms and conditions. If the Fund fails to extend, refinance or replace such debt financings prior to their maturity on commercially reasonable terms, the Fund's liquidity will be lower than it would have been with the benefit of such financings, which would limit the Fund's ability to grow, and holders of the Fund's common shares would not benefit from the potential for increased returns on equity that incurring leverage creates.

Tax Risk

If the Fund fails to qualify for tax treatment as a RIC under Subchapter M of the Code for any reason, or otherwise becomes subject to corporate income tax, the resulting corporate taxes (and any related penalties) could substantially reduce the Fund's net assets, the amount of income available for distributions to the Fund's shareholders, and the amount of income available for payment of the Fund's other liabilities.

Derivatives Risk

Derivative instruments in which the Fund may invest may be volatile and involve various risks different from, and in certain cases greater than, the risks presented by other instruments. The primary risks related to derivative transactions include counterparty, correlation, liquidity, leverage, volatility, OTC trading, operational and legal risks. In addition, a small investment in derivatives could have a large potential impact on the Fund's performance, effecting a form of investment leverage on the Fund's portfolio. In certain types of derivative transactions, the Fund could lose the entire amount of the Fund's investment; in other types of derivative transactions the potential loss is theoretically unlimited.

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Eagle Point Defensive Income Trust

Notes to Financial Statements

September 30, 2025

Counterparty Risk

The Fund may be exposed to counterparty risk, which could make it difficult for the Fund or the issuer in which the Fund invests to collect on obligations, thereby resulting in potentially significant losses.

Price Risk

Shareholders who buy shares of the Fund at different times will likely pay different prices.

Non-U.S. Investing Risk

Investing in foreign entities or issuers with underlying non-U.S. assets may expose the Fund to additional risks not typically associated with investing in U.S. entities and issuers. These risks include changes in exchange control regulations, political and social instability, restrictions on the types or amounts of investment, the imposition of sanctions, tariffs, or other governmental restrictions, expropriation, imposition of foreign taxes, less liquid markets and less available information than is generally the case in the U.S., higher transaction costs, less government supervision of exchanges, brokers and issuers, less developed bankruptcy laws, difficulty in enforcing contractual obligations, lack of uniform accounting and auditing standards, currency fluctuations and greater price volatility. Further, the Funds and the issuers in which the Fund invests may have difficulty enforcing creditor's rights in foreign jurisdictions.

Global Risk

Due to highly interconnected global economies and financial markets, the value of the Fund's securities and its underlying investments may go up or down in response to governmental actions and/or general economic conditions throughout the world. Events such as war, military conflict, acts of terrorism, social unrest, natural disasters, recessions, inflation, rapid interest rate changes, supply chain disruptions, sanctions, the enactment of trade tariffs, the spread of infectious illness or other public health threats could also significantly impact the Fund and its investments.

Banking Risk

The possibility of future bank failures poses risks of reduced financial market liquidity at clearing, cash management and other custodial financial institutions. The failure of banks which hold cash on behalf of the Fund, the Fund's underlying obligors, the sponsors or managers of the issuers in which the Fund invests, or the Fund's service providers could adversely affect the Fund's ability to pursue its investment strategies and objectives. For example, if an underlying obligor has a commercial relationship with a bank that has failed or is otherwise distressed, such company may experience delays or other disruptions in meeting its obligations and consummating business transactions. Additionally, if an issuer's manager or sponsor has a commercial relationship with a distressed bank, the manager may experience issues conducting its operations or consummating transactions on behalf of the issuer it manages, which could negatively affect the performance of such issuers (and, therefore, the performance of the Fund).

Foreign Investing Risk

The Fund may invest in securities of foreign issuers (or U.S. issuers that hold foreign assets) to the extent consistent with the Fund's investment strategies and objectives. Investing in foreign entities may expose the Fund to additional risks, including exchange control regulations, political and social instability, expropriation, foreign taxes, less liquid and transparent markets, high transaction costs, less government supervision of exchanges, brokers and issuers, less developed bankruptcy laws, difficulty in enforcing contractual obligations, lack of uniform accounting and auditing standards, currency fluctuations and greater price volatility. Further, the Fund, and the issuers in which the Fund invests, may have difficulty enforcing creditor's rights in foreign jurisdictions.

Illiquid Shares Risk

The Fund's shares are not publicly traded and the Fund does not expect a secondary market in the shares to develop in the foreseeable future, if ever. Although the Fund, as a fundamental policy, will make quarterly offers to repurchase at least 5% and up to 25% of its outstanding shares at NAV, the number of shares tendered in connection with a repurchase offer may exceed the number of shares the Fund has offered to repurchase, in which case not all of an investor's shares tendered in that offer will be repurchased. If shareholders tender for repurchase more than the repurchase offer amount for a given repurchase offer, the Fund may, but is not required to, repurchase an additional number of shares not to

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Eagle Point Defensive Income Trust

Notes to Financial Statements

September 30, 2025

exceed 2% of the outstanding shares of the Fund on the repurchase request deadline. In connection with any given repurchase offer, the Fund may offer to repurchase only the minimum amount of 5% of its outstanding shares. Hence, an investor may not be able to sell their shares when and/or in the amount desired.

4.DERIVATIVE CONTRACTS

Warrants

The Fund may receive warrants from issuers upon an investment in the debt or equity of an issuer. Warrants provide the Fund with exposure to and potential gains upon equity appreciation of the issuer's share price.

The value of a warrant has two components: time value and intrinsic value. A warrant has a limited life and expires on a certain date. As the expiration date of a warrant approaches, the time value declines. In addition, if the stock underlying the warrant declines in price, the intrinsic value of an in-the-money warrant will also decline. Furthermore, at expiration, if the price of the stock underlying the warrant does not exceed the warrant's strike price, the warrant will expire worthless. As a result, the Fund could potentially lose its entire investment in a warrant.

The Fund is also exposed to counterparty risk, which arises from the potential failure of an issuer of warrants to settle exercised warrants. The maximum potential loss to the Fund from counterparty risk is limited to the fair value of the contracts.

The following table presents the fair value amounts of derivative contracts included in the Statement of Assets and Liabilities, categorized by type of contract, as of September 30, 2025. Balances are presented on a gross basis, before application of the effect of counterparty and collateral netting. The following table also presents the realized and unrealized gain and loss amounts included in the Statement of Operations, categorized by type of contract, for the year ended September 30, 2025:

5.RELATED PARTY TRANSACTIONS

Investment Advisory Agreement

On March 6, 2024, the Fund entered into an investment advisory agreement with the Adviser (the "Advisory Agreement"). Pursuant to the terms of the Advisory Agreement, effective July 7, 2025, the date on which the SEC declared the Fund's registration statement effective, the Fund is subject to a management fee and an incentive fee for the Adviser's services.

Management Fee

The management fee is calculated at an annual rate of 1.50% of the Fund's "Managed Assets" and payable quarterly in arrears. Managed Assets are defined as the Fund's total assets (including assets attributable to leverage) minus the Fund's accrued liabilities (other than liabilities incurred for the purpose of creating leverage). The Fund was charged a management fee of $0.6 million for the year ended September 30, 2025, all of which was voluntarily waived by the Adviser and is not subject to recoupment under the ELA (defined below).

Incentive Fee

The incentive fee is calculated and payable quarterly, in arrears, on the pre-incentive fee net investment income ("PNII") attributable to each class of the Fund's shares for the immediately preceding quarter, and is subject to a hurdle rate, expressed as a rate of return on the value of the Fund's net assets, equal to 1.875% per quarter (7.5% annualized), and a "catch-up" feature. For this purpose, PNII means (a) interest income, dividend income and any other income (including any other fees, such as commitment, origination, structuring, diligence and consulting

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Eagle Point Defensive Income Trust

Notes to Financial Statements

September 30, 2025

fees) applicable to each class accrued during the calendar quarter, minus (b) each class's operating expenses for the quarter (including the management fee, expenses payable under the Administration Agreement (as defined below) to the Administrator, and any interest expense and/or dividends paid on any issued and outstanding debt or preferred stock, but excluding organizational and offering expenses and the incentive fee) after giving application to any reimbursement or recoupment under the ELA (as defined below). PNII includes, in the case of investments with a deferred interest feature (such as original issue discount, debt instruments payment-in-kind interest and zero coupon securities), accrued income that the Fund has not yet received in cash. PNII excludes any realized or unrealized capital gains or losses.

The Fund pays the Adviser an incentive fee with respect to PNII in each calendar quarter as follows:

 i.no incentive fee if PNII attributable to the applicable share class does not exceed the hurdle rate of 1.875% of such class's NAV;

  ii.100% of PNII attributable to the applicable share class with respect to that portion of such PNII, if any, exceeding the hurdle rate but equal to or less than 2.20588% of such class's NAV (the "catch-up");

iii.15% of the amount of PNII attributable to the applicable share class, if any, exceeding 2.20588% of such class's NAV.

The Fund was charged an incentive fee of $0.4 million for the year ended September 30, 2025, all of which was voluntarily waived by the Adviser and is not subject to recoupment under the ELA (defined below).

Administration Agreement

On March 6, 2024, the Fund entered into an administration agreement (the "Administration Agreement") with Eagle Point Administration LLC (the "Administrator"), an affiliate of the Adviser. Pursuant to the Administration Agreement, the Administrator provides a range of administrative services to the Fund, including maintaining financial records, providing accounting services, calculating NAV, overseeing the preparation and filing of the Fund's tax returns, monitoring compliance with tax laws and regulations, assisting with audits conducted by an independent public accounting firm, managing the printing and disseminating reports to the Fund's shareholders, maintaining the Fund's website, supporting investor relations, overseeing the payment of the Fund's expenses, coordinating the performance of administrative and professional services rendered to the Fund by third parties, and providing other administrative services as the Fund may designate from time to time.

The Fund reimburses the Administrator for costs and expenses incurred by the Administrator in performing its obligations and providing personnel (for the avoidance of doubt, including salaries and related payroll expenses) and facilities. Payments under the Administration Agreement are based on the Fund's allocable portion of the Administrator's overhead in performing its obligations under the Administration Agreement, including rent, compliance-related fees and expenses, and the Fund's allocable portion of the compensation of the Fund's chief compliance officer, chief financial officer, chief operating officer and related support staff. The Fund's allocable portion of such compensation is based on an allocation of the time spent on the Fund-related matters.

Certain accounting and other administrative services were delegated by the Administrator to ALPS Fund Services, Inc. (the "Sub Administrator"). To the extent the Administrator outsources any of its functions, the Fund pays the fees on a direct basis, without profit to the Administrator.

The Administration Agreement may be terminated by the Fund without penalty upon not less than sixty days' written notice to the Administrator and by the Administrator upon not less than ninety days' written notice to the Fund. The Administration Agreement is approved by the Board on an annual basis.

For the year ended September 30, 2025, the Fund was charged a total of $0.2 million in administration fees, relating to services provided by the Sub-Administrator, of which $0.2 million was payable as of September 30, 2025. The Fund wasn't charged administration fees by the Adviser for the same period.

The Adviser and the Administrator are under common ownership by Eagle Point Holdings LP.

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Eagle Point Defensive Income Trust

Notes to Financial Statements

September 30, 2025

Expense Limitation and Reimbursement Agreement

On March 6, 2024, the Fund entered into an Expense Limitation and Reimbursement agreement (the "ELA") with the Adviser. Pursuant to the ELA, the Adviser may, at its discretion, pay, directly or indirectly, the Fund's operating expenses or waive fees payable to the Adviser or affiliates of the Adviser, in an effort to limit the expenses borne by the Fund. Any expense payments or waivers made by the Adviser under the ELA are subject to reimbursement by the Fund for up to three years from the date such support was provided, subject to approval by the Board.

For the year ended September 30, 2025, the Adviser did not provide any expense support under the ELA.

Organizational and Offering Expense Support and Reimbursement Agreements

On March 6, 2024, the Fund entered into an Organizational and Offering Expense Support and Reimbursement Agreement (the "O&O Agreement") with the Adviser. Pursuant to the O&O Agreement, the Fund will pay for organizational and offering expenses up to a limit of 1.5% of gross proceeds raised in the offering and gross equity contributions (including the value of the initial seed portfolio). These expenses may be paid directly to third-party vendors or reimbursed to affiliates of the Fund, the Adviser, or the Administrator, subject to the organizational and offering expense limit.

For the year ended September 30, 2025, the Adviser did not provide any support under the O&O Agreement.

Board of Trustees

The Fund's Board of Trustees currently consists of six members, four of whom are not "interested persons," as defined in the 1940 Act, of the Fund and the Adviser. The Board is responsible for the overall management and supervision of our business and affairs, including the appointment of advisers and service providers. Key responsibilities of the Board include oversight of the valuation of the Fund's assets, corporate governance activities, financing arrangements and investment activities.

For the year ended September 30, 2025, the Fund incurred $0.02 million in the trustee's compensation, which is recorded on the Statement of Operations and, of which $0.02 million was payable as of September 30, 2025.

Co-Investment Exemptive Relief

On June 17, 2025, the SEC issued an exemptive order that permits the Fund to participate in certain negotiated co-investments alongside other accounts managed by the Adviser, or its affiliates, subject to certain conditions.

Affiliated Ownership

As of September 30, 2025, the Adviser and its affiliates held indirectly an aggregate of 1.00% of the Fund's shareholders' equity. Also as of September 30, 2025, an unaffiliated institutional investor (a limited partner of Eagle Point Defensive Income Fund NJ LP, an affiliate and shareholder of the Fund) held indirectly an aggregate of 99.00% of the Fund's shareholders' equity and held an indirect non-controlling ownership interest in the Adviser.

Affiliated Investments

The Fund has investments that are considered affiliated investments, as defined under the 1940 Act. These represent investments in issuers where the Fund and other funds managed by the Adviser or its affiliates collectively own 5% or more of the issuer's outstanding voting securities.

The following investments were considered affiliated investments as of September 30, 2025:

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Eagle Point Defensive Income Trust

Notes to Financial Statements

September 30, 2025

⁽¹⁾Amounts may not foot due to rounding.

6.SHAREHOLDERS' EQUITY

The Fund's authorized shares consist of an unlimited number of common shares of beneficial interest. The Fund offers its shares on a continuous basis at the applicable period end NAV per share plus any applicable sales load.

As of September 30, 2025, there were 10,010,000 common shares issued and outstanding.

Repurchases of Common Shares by the Fund

The Fund conducts quarterly offers to repurchase at least 5% and up to 25% of the Fund's outstanding shares at NAV.

For the year ended September 30, 2025, no common shares were repurchased by the Fund.

7.REVOLVING CREDIT FACILITY

The Fund may utilize leverage to the extent permitted by the 1940 Act. The Fund may obtain leverage using any form of financial leverage instruments, including funds borrowed from banks or other financial institutions, margin facilities, notes or preferred stock and leverage attributable to repurchase agreements or similar transactions. Instruments that create leverage are generally considered to be senior securities under the 1940 Act. The use of leverage creates an opportunity for increased net income and capital appreciation, but also creates additional risks and expenses which will be borne entirely by common shareholders. The Fund's leverage strategy may not ultimately be successful.

On August 2, 2024, the Fund entered into a loan and security agreement with City National Bank, as lender, establishing a revolving credit facility (the "Revolving Credit Facility"). The Revolving Credit Facility was amended on August 1, 2025, to extend the maturity date. The Revolving Credit Facility is collateralized by certain investments held by the Fund, and the Fund has granted a security interest in certain assets to the lender. Pursuant to the terms of the Revolving Credit Facility, the Fund may borrow up to the lesser of (a) the Revolver Commitment (the "Revolver Commitment"), which can be changed from time to time, and (b) the "borrowing base", calculated as varying percentages of the fair value of eligible Fund's investments. As of September 30, 2025, the Revolver Commitment was $50.0 million. Borrowings under the Revolving Credit Facility can be either Base Rate (defined as the greatest of (a) the Federal Funds Rate plus a spread, (b) the rate of interest announced or otherwise established by City National Bank as its prime commercial rate and (c) Term Secured Overnight Financing Rate ("SOFR") plus a spread) loans or SOFR loans. SOFR loans under the Revolving Credit Facility bear interest at the daily or 1 month SOFR, plus a spread. The Fund is required to pay a commitment fee on the unused amount of the Revolver Commitment.

The Revolving Credit Facility will mature on the earlier of (i) the termination of the Revolver Commitment, as defined by the terms of the Revolving Credit Facility or (ii) the scheduled maturity date of July 31, 2027. The Fund has the option to extend the maturity from time to time in accordance with the terms of the Revolving Credit Facility.

For the year ended September 30, 2025, the Fund had an average outstanding borrowing balance of $21.9 million and an average interest rate of 6.94%. The interest expense, inclusive of the commitment fee and amortization of deferred financing costs, on the Revolving Credit Facility for the same period was $1.8 million and is recorded in the Statement of Operations.

38

Eagle Point Defensive Income Trust

Notes to Financial Statements

September 30, 2025

As of September 30, 2025, the Fund's outstanding borrowing amount was $7.9 million, which is presented net of unamortized deferred financing costs of $0.3 million on the Statement of Assets and Liabilities.

See Note 9 "Asset Coverage" for further discussion on the Fund's calculation of asset coverage with respect to the Revolving Credit Facility.

8.MANDATORILY REDEEMABLE PREFERRED SHARES

As of September 30, 2025, there were 35,000 Preferred Shares authorized, issued and outstanding, with a par value of $1,000 per share.

On April 16, 2025, the Fund closed an underwritten private placement offering of 25,000 Preferred Shares, resulting in net proceeds to the Fund of approximately $24.5 million after payment of underwriting discounts and commissions. Subsequently, on May 14, 2025, the Fund issued an additional 10,000 Preferred Shares via a private placement, resulting in approximately $9.9 million of additional net proceeds after payment of underwriting commission and offering expenses.

The Fund is required to redeem all outstanding Preferred Shares on April 30, 2028 at a redemption price of $1,000 per share, plus accrued but unpaid dividends, if any. At any time on or after April 30, 2027, the Fund may, at its sole option, redeem the outstanding Preferred Shares, in whole or in part, from time to time. The holders of Preferred Shares are entitled to receive quarterly cumulative cash distributions at a rate equal to SOFR plus a 380 basis point spread per annum.

The Fund has accounted for its Preferred Shares as a liability under ASC Topic 480 - Distinguishing Liabilities from Equity ("ASC 480"), due to their mandatory redemption requirements.

Except as otherwise stated in the 1940 Act or the Fund's declaration of trust, each holder of Preferred Shares is entitled to one vote for each Preferred Share held on each matter submitted to a vote of the Fund's shareholders. The Fund's preferred and common shareholders vote together as a single class on all matters submitted to the Fund's shareholder, except that the Fund's preferred shareholders have the right to elect two trustees at all times, The remaining members of the Board are elected jointly by preferred and common shareholders voting as a single class.

9.ASSET COVERAGE

Under the provisions of the 1940 Act, the Fund is permitted to issue senior securities, including debt securities and preferred shares, and borrow from banks or other financial institutions, provided that the Fund satisfies certain asset coverage requirements.

With respect to senior securities that are equity, such as the Preferred Shares, the Fund is required to have asset coverage of at least 200%, as measured at the time of issuance of any such senior securities. Asset coverage is calculated as the ratio of the Fund's total assets, less all liabilities and indebtedness not represented by senior securities, over the aggregate amount of the Fund's outstanding senior securities representing indebtedness plus the aggregate liquidation preference of any outstanding shares of senior securities that are equity.

With respect to senior securities representing indebtedness, such as the Revolving Credit Facility or any bank borrowings (other than temporary borrowings as defined under the 1940 Act), the Fund is required to have asset coverage of at least 300%, as measured at the time of borrowing. Asset coverage is calculated as the ratio of the Fund's total assets, less all liabilities and indebtedness not represented by senior securities, over the aggregate amount of the Fund's outstanding senior securities representing indebtedness.

If the Fund's asset coverage declines below 300% (or 200%, as applicable), the Fund is prohibited under the 1940 Act from incurring additional debt or issuing additional preferred shar es and may be prohibited from declaring certain distributions to its shareholders. In addition, the terms of the Revolving Credit Facility require the Fund to cure any breach of the applicable asset coverage if the Fund fails to maintain the applicable asset coverage, and the terms of the Preferred Shares require the Fund to redeem Preferred Shares if such failure to maintain the applicable asset coverage is not cured by a certain date.

39

Eagle Point Defensive Income Trust

Notes to Financial Statements

September 30, 2025

The following table summarizes the Fund's asset coverage with respect to its Preferred Shares and Revolving Credit Facility, as of September 30, 2025 and September 30, 2024: