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Item 9A. Controls and Procedures

2021-03-16 compared with 2020-03-17 · 68 added, 14 removed, 121 unchanged (40% of the section changed)

39 unchanged sentences

Principal Accounting Fees and Services

The information required by Item 14 is hereby incorporated by reference from our Definitive Proxy Statement relating to our 2020 Annual Meeting of Shareholders, to be filed with the SEC within 120 days following the end of our fiscal year.

RSM US LLP, or RSM, has been selected to serve as our independent registered public accounting firm for the fiscal year ending December 31, 2021.

We know of no direct financial or material indirect financial interest of RSM in us.

Change in Independent Registered Public Accounting Firm

On March 22, 2019, we dismissed Ernst & Young LLP, or Ernst & Young, as our independent registered public accounting firm.

The decision to dismiss Ernst & Young was recommended and approved by the audit committee of our board of directors.

Ernst & Young’s audit reports on our financial statements for the fiscal years ended December 31, 2018 and 2017 did not contain any adverse opinion or disclaimer of opinion, and were not qualified or modified as to uncertainty, audit scope or accounting principles.

During our then-two most recent fiscal years and in the subsequent interim period from January 1, 2019 through March 22, 2019, there were (i) no disagreements between us and Ernst & Young on any matter of accounting principles or practices, financial statement disclosure, or auditing scope or procedure, which disagreements, if not resolved to the satisfaction of Ernst & Young, would have caused Ernst & Young to make reference to the subject matter of the disagreements in their reports on the financial statements for such years, and (ii) no reportable events (as that term is defined in Item 304(a)(1)(v) of Regulation S-K).

On March 26, 2019, we engaged RSM as our new independent registered public accounting firm.

The decision to engage RSM was recommended and approved by the audit committee of our board of directors.

During our then-two most recent fiscal years and in the subsequent interim period from January 1, 2019 through March 26, 2019, neither we nor anyone acting on our behalf consulted with RSM regarding any of the matters or events set forth in Item 304(a)(2) of Regulation S-K.

RSM has acted as our independent registered public accounting firm for the fiscal years ended December 31, 2020 and 2019.

Ernst & Young acted as our independent registered public accounting firm for the fiscal years ended December 31, 2012, 2013, 2014, 2015, 2016, 2017 and 2018.

Set forth in the table below are audit fees and non-audit related fees billed to us by RSM and Ernst & Young, as applicable, for professional services performed for our fiscal years ended December 31, 2020 and 2019.

Fiscal Year Audit Fees*

Audit-Related Fees**

All Other Fees****

2020 $ 749,336 $ — $ 20,374 $ —

2019 $ 611,409 $ — $ 6,500 $ —

* “Audit Fees” consist of fees billed to us by RSM and Ernst & Young, as applicable, for professional services rendered for the audit of our year-end financial statements.

These fees billed include fees related to RSM's review of the Company's debt offering document.

** “Audit-Related Fees” are those fees billed to us by RSM and Ernst & Young, as applicable, relating to audit services that are reasonably related to the performance of the audit or review of our financial statements and are not reported under “Audit Fees.”

*** “Tax Fees” are those fees billed to us by RSM and Ernst & Young, as applicable, in connection with tax compliance services, including primarily the review of our income tax returns.

**** “All Other Fees” are those fees billed to us by RSM and Ernst & Young, as applicable, in connection with permitted non-audit services.

Our audit committee reviews, negotiates and approves in advance the scope of work, any related engagement letter and the fees to be charged by the independent registered public accounting firm for audit services and permitted non-audit services for us.

All of the audit and non-audit services described above for which RSM and Ernst & Young, as applicable, billed us for the fiscal years ended December 31, 2020 and 2019 were pre-approved by the audit committee.

Audit Committee Report (1)

As part of its oversight of the financial statements of CĪON Investment Corporation, or the Company, the Audit Committee reviewed and discussed with both management and RSM US LLP and Ernst & Young LLP, the Company’s current and former independent registered public accounting firm, respectively, the Company’s consolidated financial statements filed with the SEC for the fiscal year ended December 31, 2020.

Management advised the Audit Committee that all financial statements were prepared in accordance with U.S.

generally accepted accounting principles, or GAAP, and reviewed significant accounting issues with the Audit Committee.

The Audit Committee also discussed with RSM US LLP and Ernst & Young LLP the matters required to be discussed by Statement on Auditing Standards No.

61, as amended (AICPA, Professional Standards, Vol.

1 AU section 380), as adopted by the Public Company Accounting Oversight Board in Rule 3200T, and by the Auditing Standards Board of the American Institute of Certified Public Accountants.

The Audit Committee has established a pre-approval policy that describes the permitted audit, audit-related, tax, and other services to be provided by RSM US LLP and Ernst & Young LLP.

Pursuant to the policy, the Audit Committee pre-approves the audit and non-audit services performed by RSM US LLP and Ernst & Young LLP in order to assure that the provision of such service does not impair each firm’s independence.

Any requests for audit, audit-related, tax, and other services that have not received general pre-approval must be submitted to the Audit Committee for specific pre-approval in accordance with its pre-approval policy, irrespective of the amount, and cannot commence until such approval has been granted.

Normally, pre-approval is provided at regularly scheduled meetings of the Audit Committee.

However, the Audit Committee may delegate pre-approval authority to one or more of its members.

The member or members to whom such authority is delegated must report any pre-approval decisions to the Audit Committee at its next scheduled meeting.

The Audit Committee does not delegate its responsibilities to pre-approve services performed by RSM US LLP and Ernst & Young LLP to management.

_______________________

(1) The material in this report is not “soliciting material,” is not deemed “filed” with the SEC, and is not to be incorporated by reference into any filing of the Company under the Exchange Act, whether made before or after the date hereof and irrespective of any general incorporation language in any such filing.

The Audit Committee received and reviewed the written disclosures and the letters from RSM US LLP and Ernst & Young LLP required by the applicable requirements of the Public Company Accounting Oversight Board regarding RSM US LLP’s and Ernst & Young LLP’s communications with the Audit Committee concerning independence and has discussed with RSM US LLP and Ernst & Young LLP their respective independence.

The Audit Committee has reviewed the audit fees paid by the Company to RSM US LLP and Ernst & Young LLP.

It has also reviewed non-audit services and fees to assure compliance with the Company’s and the Audit Committee’s policies restricting RSM US LLP and Ernst & Young LLP from performing services that might impair their respective independence.

Based on the reviews and discussions referred to above, the Audit Committee recommended to the Board that the audited consolidated financial statements of the Company as of and for the years ended December 31, 2020, 2019 and 2018 be included in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2020 for filing with the SEC.

March 9, 2021

The Audit Committee

Schwartz, Chair

Exhibits, Financial Statement Schedules

3 unchanged sentences

Schedules not listed above have been omitted because they are not applicable or the information required to be set forth therein is included in the consolidated financial statements or notes thereto.

Description of Document

Number Description of Document

2.1 Purchase and Sale Agreement, dated as of September 30, 2016, by and between Park South Funding, LLC and Credit Suisse Alternative Capital, LLC (Incorporated by reference to Exhibit 2.1 to Registrant’s Current Report on Form 8-K filed with the SEC on October 4, 2016 (File No.

6 unchanged sentences

4.2 Fifth Amended and Restated Distribution Reinvestment Plan of CĪON Investment Corporation (Incorporated by reference to Exhibit 4.1 to Registrant’s Current Report on Form 8-K filed with the SEC on December 8, 2016 (File No.

Description of Registrant's Securities .

4.3 Description of Registrant’s Securities (Incorporated by reference to Exhibit 4.3 to Registrant’s Annual Report on Form 10-K filed with the SEC on March 17, 2020 (File No.

10.1 Investment Advisory Agreement by and between CĪON Investment Corporation and CION Investment Management, LLC (Incorporated by reference to Exhibit (G)(1) to Pre-Effective Amendment No.

9 unchanged sentences

333-178646)).

Second Amended and Restated Expense Support and Conditional Reimbursement Agreement, dated as of December 20, 2019, by and between CĪON Investment Corporation and CION Investment Management, LLC (Incorporated by reference to Exhibit 10.1 to the Registrant’s Current Report on Form 8-K filed with the SEC on December 26, 2019 (File No.

10.4 Third A mended and Restated Expense Support and Conditional Reimbursement Agreement, dated as of December 9 , 20 20 , by and between CĪON Investment Corporation and CION Investment Management, LLC (Incorporated by reference to Exhibit 10.1 to the Registrant’s Current Report on Form 8-K filed with the SEC on December 15 , 20 20 (File No.

10.5 Amended and Restated Follow-On Dealer Manager Agreement, dated as of December 28, 2016, by and among CĪON Investment Corporation, CION Investment Management, LLC and CION Securities, LLC (Incorporated by reference to Exhibit 10.1 to Registrant’s Current Report on Form 8-K filed with the SEC on January 4, 2017 (File No.

3 unchanged sentences

10.8 Master Participation Agreement, dated as of August 26, 2016, by and between 34th Street Funding, LLC and CĪON Investment Corporation (Incorporated by reference to Exhibit 10.3 to Registrant’s Current Report on Form 8-K filed with the SEC on September 1, 2016 (File No.

Description of Document

Amended and Restated Loan and Security Agreement, dated as of September 30, 2016, by and among 34th Street Funding, LLC, JPMorgan Chase Bank, National Association, U.S.

Bank National Association and CION Investment Management, LLC (Incorporated by reference to Exhibit 10.1 to Registrant’s Current Report on Form 8-K filed with the SEC on October 4, 2016 (File No.

Number Description of Document

10.9 Amended and Restated Portfolio Management Agreement, dated as of September 30, 2016, by and among 34th Street Funding, LLC, CION Investment Management, LLC and JPMorgan Chase Bank, National Association (Incorporated by reference to Exhibit 10.3 to Registrant’s Current Report on Form 8-K filed with the SEC on October 4, 2016 (File No.

1 unchanged sentence

Bank National Association (Incorporated by reference to Exhibit 10.1 to Registrant’s Current Report on Form 8-K filed with the SEC on April 4, 2017 (File No.

Second Amendment, dated as of March 14, 2019, to Credit and Security Agreement, dated as of March 29, 2017, by and among Flatiron Funding II, LLC, CION Investment Management, LLC, CÎON Investment Corporation, the Lenders from time to time party thereto, Citibank, N.A.

10.11 Second Amendment, dated as of March 14, 2019, to Credit and Security Agreement, dated as of March 29, 2017, by and among Flatiron Funding II, LLC, CION Investment Management, LLC, C I ON Investment Corporation, the Lenders from time to time party thereto, Citibank, N.A.

Bank National Association.

4 unchanged sentences

10.14 Master Participation and Assignment Agreement, dated as of March 29, 2017, by and between 15th Street Loan Funding 2 LLC and Flatiron Funding II, LLC (Incorporated by reference to Exhibit 10.4 to Registrant’s Current Report on Form 8-K filed with the SEC on April 4, 2017 (File No.

Contribution Agreement, dated as of May 19, 2017, by and among CÎON Investment Corporation, Murray Hill Funding, LLC and Murray Hill Funding II, LLC (Incorporated by reference to Exhibit 10.1 to Registrant’s Current Report on Form 8-K filed with the SEC on May 25, 2017 (File No.

Amended and Restated Indenture, dated as of December 1, 2017, by and between Murray Hill Funding II, LLC and U.S.

Bank National Association (Incorporated by reference to Exhibit 10.1 to the Registrant’s Current Report on Form 8-K filed with the SEC on December 7, 2017 (File No.

10.15 Contribution Agreement, dated as of May 19, 2017, by and among C I ON Investment Corporation, Murray Hill Funding, LLC and Murray Hill Funding II, LLC (Incorporated by reference to Exhibit 10.1 to Registrant’s Current Report on Form 8-K filed with the SEC on May 25, 2017 (File No.

10.16 Murray Hill Funding II, LLC Class A Notes Due 2027 (Incorporated by reference to Exhibit 10.3 to Registrant’s Current Report on Form 8-K filed with the SEC on May 25, 2017 (File No.

6 unchanged sentences

10.21 Murray Hill Funding II, LLC Class A Notes Due 2027 (Incorporated by reference to Exhibit 10.2 to the Registrant’s Current Report on Form 8-K filed with the SEC on December 7, 2017 (File No.

First Amended and Restated Master Confirmation, dated as of December 1, 2017, to the October 2000 Version Global Master Repurchase Agreement, dated as of May 19, 2017, by and between UBS AG, London Branch and Murray Hill Funding, LLC (Incorporated by reference to Exhibit 10.3 to the Registrant’s Current Report on Form 8-K filed with the SEC on December 7, 2017 (File No.

Description of Document

10.22 Loan and Servicing Agreement, dated as of December 19, 2017, by and among 33rd Street Funding, LLC, CION Investment Management, LLC, Morgan Stanley Asset Funding Inc., Morgan Stanley Bank, N.A.

3 unchanged sentences

10.25 Administration Agreement, dated as of April 1, 2018, by and between CĪON Investment Corporation and CION Investment Management, LLC (Incorporated by reference to Exhibit 10.1 to the Registrant’s Current Report on Form 8-K filed with the SEC on April 3, 2018 (File No.

Third Amendment to Amended and Restated Loan Agreement, dated as of May 23, 2018, by and among 34th Street Funding, LLC, JPMorgan Chase Bank, National Association, U.S.

Number Description of Document

10.26 Second Amended and Restated Loan and Security Agreement, dated as of May 15, 2020, by and among 34th Street Funding, LLC, JPMorgan Chase Bank, National Association, U.S.

Bank National Association and CION Investment Management, LLC (Incorporated by reference to Exhibit 10.1 to Registrant’s Current Report on Form 8-K filed with the SEC on May 21, 2020 (File No.

10.27 Second Amended and Restated Master Confirmation to the Global Master Repurchase Agreement, dated as of May 19, 2020, by and between Murray Hill Funding, LLC and UBS AG (Incorporated by reference to Exhibit 10.2 to Registrant’s Current Report on Form 8-K filed with the SEC on May 21, 2020 (File No.

10.28 Third Amended and Restated Master Confirmation to the Global Master Repurchase Agreement, dated as of November 12, 2020, by and between Murray Hill Funding, LLC and UBS AG (Incorporated by reference to Exhibit 10.1 to Registrant’s Current Report on Form 8-K filed with the SEC on November 16, 2020 (File No.

10.29 Fourth Amended and Restated Master Confirmation to the Global Master Repurchase Agreement, dated as of December 17, 2020, by and between Murray Hill Funding, LLC and UBS AG (Incorporated by reference to Exhibit 10.1 to Registrant’s Current Report on Form 8-K filed with the SEC on December 23, 2020 (File No.

10.30 Revolving Credit Note Agreement, dated as of December 17, 2020, by and among Murray Hill Funding II, LLC, Murray Hill Funding, LLC, U.S.

Bank National Association, and the Class A-R Noteholders (Incorporated by reference to Exhibit 10.2 to Registrant’s Current Report on Form 8-K filed with the SEC on December 23, 2020 (File No.

10.31 Murray Hill Funding II, LLC Class A-R Notes Due 2027 (Incorporated by reference to Exhibit 10.3 to Registrant’s Current Report on Form 8-K filed with the SEC on December 23, 2020 (File No.

10.32 Second Amended and Restated Indenture, dated as of December 17, 2020, by and between Murray Hill Funding II, LLC and U.S.

Bank National Association (Incorporated by reference to Exhibit 10.4 to Registrant’s Current Report on Form 8-K filed with the SEC on December 23, 2020 (File No.

10.33 Master Confirmation to the Global Master Repurchase Agreement (Class A-R Notes), dated as of December 17, 2020, by and between Murray Hill Funding, LLC and UBS AG (Incorporated by reference to Exhibit 10.5 to Registrant’s Current Report on Form 8-K filed with the SEC on December 23, 2020 (File No.

10.34 Note Purchase Agreement of CĪON Investment Corporation related to the 2026 Notes, dated as of February 11, 2021 (Incorporated by reference to Exhibit 10.1 to Registrant’s Current Report on Form 8-K filed with the SEC on February 16, 2021 (File No.

10.35 Third Amended and Restated Loan and Security Agreement, dated as of February 26, 2021, by and among 34th Street Funding, LLC, JPMorgan Chase Bank, National Association, U.S.

Bank National Association and CION Investment Management, LLC (Incorporated by reference to Exhibit 10.1 to Registrant’s Current Report on Form 8-K filed with the SEC on March 1, 2021 (File No.

31.1 Rule 13a-14(a)/15d-14(a) Certification of Co-Chief Executive Officer.

28 unchanged sentences

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 9A. Controls and Procedures