Company: CIMO
Filing Date: 2025-10-01
Form Type: S-3ASR
Source: 0001193125-25-226772
Chunk: 42

Company: CHIMERA INVESTMENT CORP
Filing Date: 2025-10-01
Form: S-3ASR
Chunk 42
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 or both of the REIT gross income tests, or that our hedging activities will not adversely affect our ability to satisfy the REIT qualification requirements.

Even if the income from our hedging transactions is excluded from gross income for purposes of the 75% and 95% gross income tests, such income and any loss
will be taken into account in determining our REIT taxable income and our distribution requirement. If the IRS disagrees with our calculation of the amount or timing of recognition of gain or loss with respect to our hedging transactions, our
distribution requirement could increase, which could require that we correct any shortfall in distributions by paying deficiency dividends to our stockholders in a later year.

Fee Income. We may earn income from fees in certain circumstances. Fee income generally will be qualifying income for purposes of both the 75% and 95%
gross income tests if it is received in consideration for entering into an agreement to make a loan secured by real property and, the fees are not determined by income and profits. Other fees generally are not qualifying income for purposes of
either gross income test, and thus such fees, combined with other nonqualifying income for purposes of the 95% gross income test, cannot exceed 5% of our annual gross income. We may conduct some or all of our
fee-generating activities through a taxable REIT subsidiary or other corporate entity, the income from which may be subject to U.S. federal income tax. Any fees earned by a taxable REIT subsidiary will not be
included in our gross income for purposes of the gross income tests.

COD Income. From time-to-time, we may recognize COD income in connection with repurchasing our debt at a discount. COD income is excluded from gross income for purposes of both the 75% and 95% gross income tests.

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Any COD income that we recognize would be subject to the distribution requirements, subject to certain rules that apply to excess non-cash income, or we
will incur corporate income tax and a 4% nondeductible excise tax with respect to any COD income.

Rents from Real Property.We do not currently
own any real property for the production of rental income. If we were to acquire real property or an interest therein for the production of rental income, rents we receive would qualify as “rents from real property” in satisfying the
gross income requirements for a REIT described above only if several conditions are met. These conditions relate to the identity of the tenant, the computation of the rent payable, and