Business Context and Reporting Period
Company: Chimera Investment Corporation (CIM)
Filing Type: Form 8-K (Current Report)
Date of Report: September 27, 2023
Subject: Regulation FD Disclosure regarding the transition of reference rates for Series B, C, and D Preferred Stock following the cessation of LIBOR.
Key Financial Metrics
This filing does not contain financial performance data such as revenue, profit, cash flow, margins, debt levels, or liquidity metrics. The document focuses exclusively on the mechanics of dividend rate calculations for specific preferred stock classes.
Material Changes
The filing reiterates the Company's position that the federal Adjustable Interest Rate (LIBOR) Act applies to its Series B, C, and D Preferred Stock. Consequently, the reference rate for dividend calculations will transition from three-month LIBOR to three-month CME Term SOFR plus a tenor spread adjustment of 0.26161% per annum. The effective dates for this transition are:
- Series B Preferred Stock: March 30, 2024
- Series C Preferred Stock: September 30, 2025
- Series D Preferred Stock: March 30, 2024
Guidance, Outlook, and Risks
Management Commentary: The Company believes the automatic replacement of LIBOR with SOFR will occur based on current information and the applicability of the LIBOR Act. This filing clarifies the Company's stance in response to market participants indicating intentions to fix dividend rates on similar instruments.
Risks and Contingencies: The document includes standard forward-looking statement disclaimers. Actual results may differ due to changes in law, additional regulations under the LIBOR Act, or changes in the interpretation of the Act and related regulations. The Company does not undertake an obligation to update these statements.
Investor Verification Checklist
- Verify the specific tenor spread adjustment (0.26161%) applied to the CME Term SOFR rate.
- Confirm the exact dividend period start dates for the SOFR transition for Series B, C, and D stock.
- Review the Company's most recent Form 10-K and 10-Q for detailed risk factors related to interest rate changes and regulatory compliance.
- Monitor for any future regulatory updates regarding the LIBOR Act that could alter the automatic replacement mechanism.