CION Investment Corporation Amends and Extends Its Senior Secured Credit Facility, Providing Improved Economic Terms and More Constructive Operating Provisions

Rhea-AI Summary

CION Investment (NYSE: CION) has successfully amended and extended its $675 million senior secured credit facility with JPMorgan Chase Bank. The amendment brings improved economic terms and more favorable operating provisions. Key changes include:

1. Reduction in credit spread from SOFR + 3.20% to SOFR + 2.55% per year
2. Extension of reinvestment period from July 15, 2024 to June 15, 2026
3. Extension of maturity date from May 15, 2025 to June 15, 2027

CION's CFO, Keith Franz, highlighted the strategic importance of the partnership with JPMorgan and the benefits of the amended facility, including reduced cost of capital and increased financial flexibility.

Positive

• Reduced credit spread from SOFR + 3.20% to SOFR + 2.55%, lowering borrowing costs
• Extended reinvestment period by nearly two years, providing more time for capital deployment
• Extended maturity date by over two years, improving long-term financial stability
• Improved overall cost of capital, enhancing potential profitability
• Increased financial flexibility, allowing for better strategic decision-making

Negative

• Incurred customary costs and expenses related to the amendment
• Annual administrative fee to be paid, potentially impacting expenses

Insights

Financial Analyst

The amendment and extension of CION's senior secured credit facility is a significant move for the company. By reducing the credit spread from 3.20% to 2.55%, CION will save on interest expenses, which directly enhances their profitability. Extending the reinvestment period and maturity date provides further financial stability and flexibility, allowing CION to better manage their cash flow and funding needs over a longer horizon. This move can be seen as a strategic financial maneuver to leverage favorable market conditions and reduce capital costs, which is a positive signal for investors.

Market Research Analyst

The extension and amendment of the credit facility with JPMorgan Chase highlights the strength of CION's relationships with key financial institutions. This is a strong indicator of confidence from lenders in CION's financial health and business strategy. The improved economic terms could lead to better financial performance and potentially boost CION's stock price as investors may view this as a sign of prudent financial management. Moreover, extending the reinvestment period and maturity dates adds stability to CION’s future financial planning, reducing the risk of short-term financing pressures.

Legal Expert

From a legal standpoint, the amendment to the credit facility includes customary costs and an annual administrative fee, which are standard in such agreements. However, the more constructive operating provisions, particularly the extended reinvestment and maturity periods, align with CION's strategy to maintain financial flexibility and reduce dependency on short-term financing. This adjustment could potentially help them in avoiding refinancing risks. The cooperation with JPMorgan Chase, a reputable institution, further strengthens the legal and financial positioning of CION in the market.

NEW YORK--(BUSINESS WIRE)-- CION Investment Corporation (NYSE: CION) (“CION”) announced today that it has amended and extended its $675 million senior secured credit facility with JPMorgan Chase Bank, National Association.

Under the amendment, the credit spread on the floating interest rate payable on all borrowings was reduced from the three-month Secured Overnight Financing Rate (“SOFR”) plus a credit spread of 3.20% per year to SOFR plus a credit spread of 2.55% per year. Also under the amendment, the reinvestment period was extended from July 15, 2024 to June 15, 2026 and the maturity date was extended from May 15, 2025 to June 15, 2027.

CION incurred certain customary costs and expenses in connection with the amendment and will pay an annual administrative fee.

Keith Franz, CFO of CION stated, “JPMorgan has been a longstanding strategic lending partner to CION, and we are pleased to continue to work with them to amend and extend our existing credit facility at more attractive terms, helping to reduce our overall cost of capital and providing us with greater financial flexibility.”

ABOUT CION INVESTMENT CORPORATION

CION Investment Corporation is a leading publicly listed business development company that had approximately $2.0 billion in total assets as of March 31, 2024. CION seeks to generate current income and, to a lesser extent, capital appreciation for investors by focusing primarily on senior secured loans to U.S. middle-market companies. CION is advised by CION Investment Management, LLC, a registered investment adviser and an affiliate of CION. For more information, please visit www.cionbdc.com.

FORWARD-LOOKING STATEMENTS

This press release may contain forward-looking statements that involve substantial risks and uncertainties. You can identify these statements by the use of forward-looking terminology such as "may," "will," "should," "expect," "anticipate," "project," "target," "estimate," "intend," "continue," or "believe" or the negatives thereof or other variations thereon or comparable terminology. You should read statements that contain these words carefully because they discuss CION’s plans, strategies, prospects and expectations concerning its business, operating results, financial condition and other similar matters. These statements represent CION’s belief regarding future events that, by their nature, are uncertain and outside of CION’s control. There are likely to be events in the future, however, that CION is not able to predict accurately or control. Any forward-looking statement made by CION in this press release speaks only as of the date on which it is made. Factors or events that could cause CION’s actual results to differ, possibly materially from its expectations, include, but are not limited to, the risks, uncertainties and other factors CION identifies in the sections entitled "Risk Factors" and "Forward-Looking Statements" in filings CION makes with the SEC, and it is not possible for CION to predict or identify all of them. CION undertakes no obligation to update or revise publicly any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law.

OTHER INFORMATION

The information in this press release is summary information only and should be read in conjunction with CION’s Current Report on Form 8-K, which CION filed with the SEC on July 18, 2024, as well as CION’s other reports filed with the SEC. A copy of CION’s Current Report on Form 8-K and CION’s other reports filed with the SEC can be found on CION’s website at www.cionbdc.com and the SEC’s website at www.sec.gov.

View source version on businesswire.com: https://www.businesswire.com/news/home/20240722961515/en/

Media

Susan Armstrong

sarmstrong@cioninvestments.com

Investor Relations

Charlie Arestia

carestia@cioninvestments.com

(646) 253-8259

James Carbonara

Hayden IR

James@haydenir.com

(646) 755-7412

Source: CION Investment Corporation

FAQ

What changes were made to CION's credit facility with JPMorgan Chase Bank?

CION amended its $675 million credit facility, reducing the credit spread from SOFR + 3.20% to SOFR + 2.55%, extending the reinvestment period to June 15, 2026, and extending the maturity date to June 15, 2027.

How does the amended credit facility benefit CION Investment (NYSE: CION)?

The amended facility provides CION with a lower cost of capital, greater financial flexibility, and an extended timeline for reinvestment and repayment, potentially improving its overall financial position and strategic capabilities.

When is the new maturity date for CION's credit facility after the amendment?

The new maturity date for CION's credit facility has been extended to June 15, 2027, providing the company with additional time to manage its debt obligations.

What is the new credit spread for CION's borrowings under the amended facility?

Under the amended credit facility, CION's new credit spread for borrowings is SOFR plus 2.55% per year, reduced from the previous SOFR plus 3.20% per year.