📄 What This Document Is

This is a Form 497AD, which is essentially a final "deal wrap-up" announcement filed with the SEC. It confirms that Ellington Credit Company has successfully closed its debt offering. Think of it as the official "the sale is complete" notice after the initial marketing of the bonds.

🏢 What The Company Does

👉 In simple terms, Ellington Credit Company is an investment fund that acts like a specialized lender. It pools money from investors to buy parts of complex corporate loans (called CLOs), especially the riskier, higher-yielding slices. It's externally managed by Ellington Management Group, a firm with deep expertise in this niche corner of the bond market.

💰 The Offering Details

Ellington has raised money by selling IOUs (notes) to the public. Here are the key terms:

• Total Size: $54.0 million (after the underwriters sold a bit extra).
• Interest Rate: 8.50% per year.
• Maturity Date: These notes must be repaid in 2031.
• Credit Rating: Rated 'BBB' by Egan-Jones, which is an investment-grade rating. This helps attract conservative investors.
• Stock Symbol: The notes will trade on the New York Stock Exchange under the symbol "ELLA".

🚀 Why This Deal Matters

👉 This isn't just about raising cash; it's a strategic move. By issuing these longer-term, fixed-rate notes, Ellington is locking in a known cost of capital for the next five years. This replaces or pays off shorter-term, floating-rate debt, which reduces their risk if interest rates rise and makes their funding more predictable.

🎯 What The Money Is For

The net proceeds have two main purposes:

1. Growth: To buy more investment assets (like those CLO tranches) that align with their strategy.
2. Refinancing: To pay back short-term borrowing (reverse repurchase agreements) they used to finance existing investments. This deleverages and cleans up their balance sheet.

⚙️ The Deal Team

The sale was managed by a syndicate of banks. Piper Sandler & Co. was the lead manager. The banks have a 30-day window to buy up to $7.5 million more if demand is high (the over-allotment option), of which they've already used $4.0 million.

⚖️ The Big Picture

• 👍 Strength: Successfully tapping the debt market shows investor confidence. The investment-grade rating and NYSE listing make the notes accessible to a wide range of institutional investors.
• ⚠️ Risk: The fund operates in the complex and potentially volatile CLO market. Their performance depends on correctly managing credit risk. An 8.5% interest rate also reflects the market's assessment of that risk.

🧠 The Analogy

Issuing these notes is like a homeowner swapping a scary, variable-rate credit card balance for a fixed-rate home equity loan. They get a known payment (8.5%) for a long time (until 2031) and use the cash to renovate (buy more assets) and pay off the expensive credit card (short-term borrowings).

📇 Key Contacts & People

• Investor Inquiries:
  • Ellington Credit Company Investor Relations
  • Phone: (203) 409-3773
  • Email: [email protected]
• Media Inquiries:
  • Amanda Shpiner / Grace Cartwright
  • Gasthalter & Co. for Ellington Credit Company
  • Phone: (212) 257-4170
  • Email: [email protected]

🧩 Final Takeaway

Ellington Credit successfully raised $54 million in long-term, fixed-rate debt to grow its portfolio and simplify its finances. This move provides strategic funding stability but underscores the importance of their skill in navigating the complex corporate loan market.