8-K
Orchid Island Capital, Inc. (ORC)
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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON,
DC 20549
FORM
8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported):
June 14, 2022
Orchid Island Capital, Inc.
(Exact Name of Registrant as Specified in Charter)
Maryland
001-35236
27-3269228
(State or Other Jurisdiction of
Incorporation)
(Commission File Number)
(IRS Employer Identification No.)
3305 Flamingo Drive
,
Vero Beach
,
Florida
32963
(Address of Principal Executive Offices) (Zip Code)
Registrant’s telephone number,
including area code
(
772
)
231-1400
N/A
(Former Name or Former Address, if Changed Since Last Report)
Check the appropriate box below if the Form 8-K filing is intended
to simultaneously satisfy the filing obligation of the
registrant under any of the following provisions:
☐
Written communications pursuant
to Rule 425 under the Securities Act (17 CFR 230.425)
☐
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a
-12)
☐
Pre-commencement communications pursuant to Rule 14d-2(b)
under the Exchange Act (17 CFR 240.14d-2(b))
☐
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange
Act (17 CFR 240.13e-4(c))
Securities registered pursuant to Section 12(b) of the Act:
Title of each class:
Trading symbol:
Name of each exchange
on which registered:
Common Stock, par value $0.01 per share
ORC
NYSE
Indicate by check mark whether the registrant is an emerging growth
company as defined in Rule 405 of the Securities Act of
1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange
Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company
☐
If an emerging growth company,
indicate by check mark if the registrant has elected not to use the extended transition period
for complying with any new or revised financial accounting standards provided
pursuant to Section 13(a) of the Exchange
Act.
☐
Item 5.07.
Submission of Matters to a Vote
of Security Holders.
At the 2022 Annual Meeting of Stockholders (the “Annual Meeting”) of Orchid Island Capital, Inc. (the “Company”), the
Company’s stockholders voted on the following matters: (i) the election of
the six nominated directors to the
Company’s board
of directors (the “Board”), (ii) the ratification of the appointment of BDO USA, LLP as the Company’s independent registered
public accounting firm for the year ending
December 31, 2022 and (iii) the
approval, on an advisory basis, of
the compensation
of
the
Company’s
named
executive
officers.
As
of
April
14,
2022,
the
record
date
for
the
Annual
Meeting,
there
were
177,117,186
shares of the
Company’s
common stock, par
value $0.01 per
share (“Common
Stock”) outstanding
and entitled
to vote.
The full results of the matters voted on at the Annual Meeting are set forth below:
Proposal
1—Election
of
Directors.
The
following
nominees
were
elected
to
our
Board
to
serve
until
the
next
annual
meeting
of the
Company’s
stockholders
or until
his or
her successor
is elected
and
qualified:
Robert
E. Cauley,
George
H.
Haas, IV,
W Coleman Bitting, Frank P.
Filipps, Paula Morabito and Ava
L. Parker.
Nominee for Director
For
Against
Abstain
Broker Non-Votes
Robert E. Cauley ..............................
40,726,867
3,782,837
1,279,233
58,504,516
George H. Haas, IV
..........................
39,072,859
5,413,316
1,302,762
58,504,516
W Coleman Bitting
...........................
40,773,964
3,665,608
1,349,365
58,504,516
Frank P.
Filipps ................................
40,836,297
3,646,860
1,305,780
58,504,516
Paula Morabito
.................................
40,846,889
3,668,641
1,273,407
58,504,516
Ava L. Parker ...................................
40,488,654
4,026,853
1,273,430
58,504,516
Proposal 2—Ratification of Appointment of Independent Registered Public
Accounting Firm. This proposal was ratified
upon the following vote.
For
Against
Abstain
Broker Non-Votes
96,696,109
5,026,770
2,570,574
*
_______________
*
No broker non-votes arose in connection with Proposal 2 due to the fact that the matter was considered “routine” under New York
Stock Exchange rules.
Proposal 3—Advisory Vote
on Named Executive Officer Compensation. This advisory vote was
approved upon the
following vote.
For
Against
Abstain
Broker Non-Votes
35,936,672
7,605,215
2,247,050
58,504,516
Item 8.01.
Other Events.
On June 14, 2022, the Company announced that the Board declared a dividend for the month of June 2022 of $0.045 per share
of Common Stock to be
paid on July 27, 2022
to holders of record on
June 30, 2022, with
an ex-dividend date of June
29, 2022.
In
addition,
the
Company
announced
certain
details
of
its
RMBS
portfolio
as
of
May
31,
2022
as
well
as
certain
other
information regarding the Company. A copy
of the Company’s press release
announcing the dividend and the
other information
regarding the Company is attached hereto as Exhibit 99.1 and incorporated herein
by this reference.
Caution About Forward-Looking Statements.
This Current Report on Form 8-K contains forward-looking statements within
the meaning of the Private Securities Litigation
Reform
Act
of
1995
and
other
federal
securities
laws,
including,
but
not
limited
to,
statements
about
the
Company’s
distributions. These forward-looking statements are based upon the Company’s
present expectations, but the Company cannot
assure investors that
actual results will
not vary from
the expectations contained
in the forward-looking
statements. Investors
should
not
place
undue
reliance
upon
forward
looking
statements.
For
further
discussion
of
the
factors
that
could
affect
outcomes, please refer
to the “Risk Factors” section
of the Company's Annual
Report on Form 10-K
for the fiscal year
ended
December
31,
2021.
All
forward-looking
statements
speak
only
as
of
the
date
on
which
they
are
made.
New
risks
and
uncertainties
arise over
time, and
it is
not possible
to predict
those events
or how
they may
affect
the Company.
Except as
required by
law,
the Company
is not
obligated to,
and does
not intend
to, update
or revise
any forward-looking
statements,
whether as a result of new information, future events or otherwise.
Item 9.01. Financial Statements and Exhibits.
(d)
Exhibits
Exhibit No.
Description
99.1
Press Release dated June 14, 2022
104
Cover Page Interactive Data File (embedded within the Inline XBRL
document)
Signatures
Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this
report to be signed on
its behalf by the undersigned hereunto duly authorized.
Date: June 15, 2022
ORCHID ISLAND CAPITAL,
INC.
By:
/s/ Robert E. Cauley
Robert E. Cauley
Chairman and Chief Executive Officer
orc8k20220614x991
ORCHID ISLAND CAPITAL ANNOUNCES
JUNE 2022 MONTHLY DIVIDEND AND MAY
31, 2022 RMBS PORTFOLIO
CHARACTERISTICS
●
June 2022 Monthly Dividend of $0.045 Per Share of Common Stock
●
RMBS Portfolio Characteristics as of May 31, 2022
●
Next Dividend Announcement Expected July 13, 2022
Vero
Beach, Fla., June 14, 2022 - Orchid Island Capital, Inc. (the “Company”) (NYSE: ORC) announced today that the Board
of Directors
of the
Company (the
“Board”) declared
a monthly
cash dividend
for the
month of
June 2022.
The dividend
of
$0.045 per share
will be paid
July 27, 2022,
to holders of
record of the
Company’s common
stock on June
30, 2022, with
an
ex-dividend date of June 29, 2022. The Company plans on announcing
its next common stock dividend on July 13, 2022.
The Company intends to make
regular monthly cash distributions
to its holders of common stock.
In order to qualify as a
real
estate investment trust (“REIT”), the Company must distribute annually
to its stockholders an amount at least equal to 90% of
its REIT
taxable income,
determined without
regard to
the deduction
for dividends
paid and
excluding any
net capital
gain.
The Company
will be subject
to income
tax on taxable
income that is
not distributed
and to an
excise tax to
the extent that
a
certain percentage
of its
taxable income
is not
distributed by
specified dates.
The Company
has not
established a
minimum
distribution payment level and is not assured of its ability to make distributions
to stockholders in the future.
As of June 14, 2022, May 31, 2022 and March 31, 2022, the Company had 177,117,186
shares of common stock outstanding.
RMBS Portfolio Characteristics
Details of the RMBS
portfolio as of
May 31, 2022
are presented below.
These figures are
preliminary and subject
to change.
The information contained herein is an intra-quarter update created by
the Company based upon information that the Company
believes is accurate:
●
RMBS Valuation
Characteristics
●
RMBS Assets by Agency
●
Investment Company Act of 1940 (Whole Pool) Test
Results
●
Repurchase Agreement Exposure by Counterparty
●
RMBS Risk Measures
About Orchid Island Capital, Inc.
Orchid Island Capital, Inc. is a specialty finance company that invests on a
leveraged basis in Agency RMBS. Our investment
strategy focuses on, and
our portfolio consists of,
two categories of Agency
RMBS: (i) traditional pass-through
Agency RMBS,
such
as
mortgage
pass-through
certificates
and
collateralized
mortgage
obligations
issued
by
Fannie
Mae,
Freddie
Mac
or
Ginnie Mae, and (ii)
structured Agency RMBS. The
Company is managed by
Bimini Advisors, LLC, a
registered investment
adviser with the Securities and Exchange Commission.
Forward-Looking Statements
This press release contains
forward-looking statements within
the meaning of
the Private Securities Litigation
Reform Act of
1995 and other
federal securities laws. These
forward-looking statements
include, but are not
limited to, statements about
the
Company’s distributions
.
These forward-looking statements are based upon Orchid Island Capital, Inc.’s present expectations,
but these statements
are not guaranteed
to occur.
Investors should not place
undue reliance upon forward-looking
statements.
For further
discussion of
the factors
that could
affect outcomes,
please refer
to the
“Risk Factors”
section of
the Company’s
Annual Report on Form 10-K for the fiscal year ended December 31,
2021.
RMBS Valuation Characteristics
($ in thousands)
Realized
Realized
May 2022
Mar - May
Modeled
Modeled
Net
Weighted
CPR
2022 CPR
Interest
Interest
%
Weighted
Average
(1-Month)
(3-Month)
Rate
Rate
Current
Fair
of
Current
Average
Maturity
(Reported
(Reported
Sensitivity
Sensitivity
Type
Face
Value
Portfolio
Price
Coupon
GWAC
Age
(Months)
in Jun)
in Jun)
(-50 BPS)
(1)
(+50 BPS)
(1)
Pass Through RMBS
15yr 2.5
$
419
$
432
0.01%
$
103.01
4.00%
4.54%
49
131
0.8%
0.8%
$
7
$
(7)
15yr TBA
175,000
175,697
4.17%
100.40
3.50%
2,950
(3,310)
15yr Total
175,419
176,129
4.18%
100.40
3.50%
4.54%
49
131
0.8%
0.8%
2,957
(3,317)
30yr 3.0
3,500,185
3,363,833
79.75%
96.10
3.00%
3.47%
14
344
8.1%
7.5%
106,826
(112,329)
30yr 3.5
230,994
230,669
5.47%
99.86
3.50%
4.03%
27
325
14.2%
14.1%
6,331
(6,645)
30yr 4.0
270,277
272,437
6.46%
100.80
4.00%
4.71%
12
347
7.8%
26.8%
5,928
(6,852)
30yr Total
4,001,456
3,866,939
91.67%
96.64
3.10%
3.58%
14
343
8.5%
8.4%
119,085
(125,826)
Total Pass Through
RMBS
4,176,875
4,043,068
95.85%
96.80
3.11%
3.62%
16
334
8.5%
8.4%
122,042
(129,143)
Structured RMBS
IO 20yr 3.0
335,999
40,141
0.95%
11.95
3.00%
3.69%
71
162
12.3%
16.4%
(595)
299
IO 20yr 4.0
12,205
1,485
0.04%
12.17
4.00%
4.57%
125
108
13.8%
16.0%
-
(2)
IO 30yr 3.0
42,190
6,859
0.16%
16.26
3.00%
3.69%
35
318
10.4%
13.7%
(249)
181
IO 30yr 3.5
510,044
97,678
2.32%
19.15
3.50%
4.01%
54
297
11.5%
14.1%
(2,522)
1,738
IO 30yr 4.0
151,311
26,628
0.63%
17.60
4.00%
4.55%
73
278
18.2%
21.3%
(1,071)
890
IO 30yr 4.5
4,261
761
0.02%
17.86
4.50%
4.99%
143
204
14.6%
18.6%
(22)
17
IO 30yr 5.0
2,367
427
0.01%
18.03
5.00%
5.36%
143
204
4.8%
18.5%
(15)
12
IO Total
1,058,377
173,979
4.12%
16.44
3.41%
3.99%
63
250
12.7%
15.9%
(4,474)
3,135
IIO 30yr 4.0
35,321
1,162
0.03%
3.29
3.40%
4.40%
57
294
0.6%
9.6%
217
(230)
Total Structured
RMBS
1,093,698
175,141
4.15%
16.01
3.41%
4.00%
62
251
12.3%
15.7%
(4,257)
2,905
Total Mortgage Assets
$
5,270,573
$
4,218,209
100.00%
3.17%
3.70%
25
317
9.3%
10.0%
$
117,785
$
(126,238)
Interest
Interest
Average
Hedge
Rate
Rate
Notional
Period
Sensitivity
Sensitivity
Hedge
Balance
End
(-50 BPS)
(1)
(+50 BPS)
(1)
5-Year Treasury
Future
(2)
$
(1,194,000)
Sep-2022
$
(27,336)
$
26,775
10-Year Treasury
Ultra
(3)
(270,000)
Sep-2022
(15,009)
14,116
TBA
(1,400,000)
Jul-2028
(38,357)
37,016
Swaps
(175,000)
Jul-2022
(5,868)
6,055
Swaptions
(777,800)
Mar-2023
(12,242)
11,918
Hedge Total
$
(3,816,800)
$
(98,812)
$
95,880
Rate Shock Grand Total
$
18,973
$
(30,358)
(1)
Modeled results from
Citigroup Global Markets
Inc. Yield
Book. Interest rate
shocks assume instantaneous
parallel shifts and
horizon prices are
calculated assuming
constant LIBOR option-adjusted spreads. These results are for illustrative purposes
only and actual results may differ materially.
(2)
Five-year Treasury futures contracts were valued
at prices of $112.95 at May 31, 2022.
The market value of the short position was $1,348.6 million.
(3)
Ten-year Treasury
Ultra futures contracts were valued at prices of $128.48 at May 31, 2022.
The market value of the short position was $346.9 million.
RMBS Assets by Agency
Investment Company Act of 1940 Whole Pool Test
($ in thousands)
($ in thousands)
Percentage
Percentage
Fair
of
Fair
of
Asset Category
Value
Portfolio
Asset Category
Value
Portfolio
As of May 31, 2022
As of May 31, 2022
Fannie Mae
$
2,850,250
70.5%
Non-Whole Pool Assets
$
239,763
5.9%
Freddie Mac
1,192,260
29.5%
Whole Pool Assets
3,802,747
94.1%
Total Mortgage Assets
$
4,042,510
100.0%
Total Mortgage Assets
$
4,042,510
100.0%
Borrowings By Counterparty
($ in thousands)
Weighted
Weighted
% of
Average
Average
Total
Total
Repo
Maturity
Longest
As of May 31, 2022
Borrowings
Debt
Rate
in Days
Maturity
J.P.
Morgan Securities LLC
$
372,441
9.8%
0.71%
13
7/25/2022
ABN AMRO Bank N.V.
335,617
8.6%
0.84%
36
7/14/2022
Merrill Lynch, Pierce, Fenner & Smith
325,745
8.4%
0.95%
36
7/13/2022
Mitsubishi UFJ Securities (USA), Inc
314,666
8.1%
1.15%
32
7/28/2022
Mirae Asset Securities (USA) Inc.
295,186
7.6%
0.87%
77
11/18/2022
Cantor Fitzgerald & Co
256,377
6.6%
0.96%
38
8/23/2022
RBC Capital Markets, LLC
232,284
6.0%
0.89%
38
7/27/2022
ING Financial Markets LLC
206,841
5.3%
0.86%
3
6/3/2022
Goldman, Sachs & Co.
201,626
5.2%
1.10%
25
6/27/2022
ASL Capital Markets Inc.
186,177
4.8%
0.89%
17
6/21/2022
Santander Bank, N.A.
180,243
4.6%
0.97%
35
7/25/2022
Daiwa Capital Markets America Inc.
151,289
3.9%
0.73%
16
6/16/2022
ED&F Man Capital Markets Inc
151,112
3.9%
1.02%
50
7/25/2022
Wells Fargo Bank, N.A.
125,542
3.2%
0.81%
31
7/21/2022
Citigroup Global Markets Inc
121,265
3.1%
1.05%
37
7/18/2022
BMO Capital Markets Corp.
116,662
3.0%
1.17%
47
7/18/2022
Nomura Securities International, Inc.
88,988
2.3%
0.90%
17
6/17/2022
Austin Atlantic Asset Management Co.
86,789
2.2%
0.89%
1
6/1/2022
South Street Securities, LLC
60,672
1.6%
1.17%
48
7/18/2022
Lucid Cash Fund USG, LLC
44,112
1.1%
0.99%
9
6/9/2022
StoneX Financial Inc.
24,010
0.6%
0.89%
16
6/16/2022
Mizuho Securities USA, Inc
3,677
0.1%
1.29%
10
6/10/2022
Total Borrowings
$
3,881,321
100.0%
0.93%
32
11/18/2022
Contact:
Orchid Island Capital, Inc.
Robert E. Cauley
3305 Flamingo Drive, Vero
Beach, Florida 32963
Telephone: (772)
231-1400