Company: CIMO
Filing Date: 2025-02-19
Form Type: 10-K
Source: 0001628280-25-006426
Chunk: 203

Company: CHIMERA INVESTMENT CORP
Filing Date: 2025-02-19
Form: 10-K
Item: Item 1A
Chunk 203
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 valuation of Agency MBS and Non-Agency RMBS (Notes 3 and 5), residential mortgage loans (Notes 4 and 5), secured financing agreements (Notes 5 and 6), securitized debt (Notes 5 and 7), goodwill and intangibles (Note 17), contingent earn-out liability(Note 17). Actual results could differ materially from those estimates.(o) Long Term DebtThe Company's Long Term Debt is comprised of unsecured senior notes. Unsecured senior notes are carried at their unpaid principal balance net of any unamortized deferred issuance costs. Interest on the notes is payable quarterly until such time the notes mature. Any debt discounts or premiums are reported as an adjustment to the carrying amount of the debt liability and amortized into interest expense using the effective interest method. Deferred debt issuance costs are expenses associated with the issuance of long-term debt. These expenses typically include underwriting, legal, accounting, and other fees. Deferred debt issuance costs are included in the carrying value of the related long-term debt issued and are amortized as an adjustment to interest expense using the effective interest method, based upon the actual and estimated repayment schedules of the related long-term debt issued.(p) Investment and Asset Management FeesThe Company earns advisory fees relating to the terms of investment management agreements entered into with its investment partnerships and privately offered pooled investment vehicles, insurance companies, and other institutional clients (collectively “Clients”). In accordance with ASC 606, as the Company’s performance obligation for these services is satisfied over time and the benefits of these services are simultaneously consumed by the Clients, revenue is recognized. Advisory fees are generally based on either i) the unpaid principal balance of the underlying mortgage assets; or ii) the amortized cost basis of the underlying mortgage assets, either gross or net of outstanding financing arrangements, depending on the specific terms of each Client agreement. In addition to base advisory fees, certain Client agreements include incentive-based fee arrangements tied to the underlying assets or the resolution/monetization of specific portfolio assets. These fees may be calculated as a percentage of the asset's unpaid principal balance, cost basis, liquidation proceeds, or profits, including profits exceeding specified thresholds. Revenue for such fees is recognized when they are no longer subject to significant reversal under applicable clawback provisions. Transaction fees are recognized upon achieving certain transaction settlement milestones when the Company satisfies its performance obligation; in most cases, such milestones represent the completion of the purchase or sale transaction.(q) Business CombinationsIn accordance with ASC Topic 805 “Business