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 11, 2019

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 annual meeting of stockholders of Orchid Island Capital, Inc. (the “Company”) held on June 11. 2019 (the “Annual Meeting”), the stockholders voted on the following matters: (i) the election of the six nominated directors,  and (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, 2019 . As of April 10, 2019, the record date for the Annual Meeting, there were 50,630,128 shares of common stock outstanding and entitled to vote.
 
The full results of the matters voted on at the annual meeting of stockholders 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
   
17,664,453
     
677,571
     
216,318
     
27,917,967
 
George H. Haas, IV
   
16,765,258
     
1,570,331
     
222,753
     
27,917,967
 
W Coleman Bitting
   
17,663,238
     
666,524
     
228,580
     
27,917,967
 
Frank P. Filipps
   
17,513,800
     
823,041
     
221,501
     
27,917,967
 
Paula Morabito
   
17,588,428
     
760,046
     
209,868
     
27,917,967
 
Ava L. Parker
   
16,685,319
     
1,603,725
     
269,298
     
27,917,967
 

 
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
44,251,768
1,348,532
876,009
*


___________
*
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.

Item 8.01.  Other Events.

On June 11, 2019, the Company announced that the Board of Directors of the Company declared a dividend for the month of June 2019 of $0.08 per share to be paid on July 31, 2019 to holders of record on June 28, 2019, with an ex-dividend date of June 27, 2019. In addition, the Company announced certain details of its MBS portfolio as of May 31, 2019 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. 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 Form 10-K for the year ended December 31, 2018.  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
 




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 11, 2019
        ORCHID ISLAND CAPITAL, INC.
 
 
 
 
 
 
 
 
By:
/s/ Robert E. Cauley
 
 
 
Robert E. Cauley
 
 
 
Chairman and Chief Executive Officer
 
EXHIBIT 99.1

ORCHID ISLAND CAPITAL ANNOUNCES
JUNE 2019 MONTHLY DIVIDEND AND
MAY 31, 2019 RMBS PORTFOLIO CHARACTERISTICS


·
June 2019 Monthly Dividend of $0.08 Per Share
·
RMBS Portfolio Characteristics as of May 31, 2019
·
Next Dividend Announcement Expected July 17, 2019

Vero Beach, Fla., June 11, 2019 - Orchid Island Capital, Inc. (the “Company”) (NYSE:ORC) announced today that the Board of Directors (the “Board”) declared a monthly cash dividend for the month of June 2019. The dividend of $0.08 per share will be paid July 31, 2019, to holders of record on June 28, 2019, with an ex-dividend date of June 27, 2019.  The Company plans on announcing its next dividend after the Board’s meeting on July 17, 2019.

The Company intends to make regular monthly cash distributions to its stockholders. 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 11, 2019, the Company had 53,507,949 shares outstanding. At March 31, 2019, the Company had 49,937,700 shares outstanding.

RMBS Portfolio Characteristics

Details of the RMBS portfolio as of May 31, 2019 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 in Agency RMBS that are either traditional pass-through Agency RMBS or structured Agency RMBS. Orchid Island Capital, Inc. has elected to be taxed as a REIT for federal income tax purposes.

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 and the expected funding of purchased assets and anticipated borrowings. 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 Form 10-K for the year ended December 31, 2018.


RMBS Valuation Characteristics
                                                                   
($ in thousands)
                                                                       
                                                   
Realized
   
Realized
             
                                                   
May 2019
   
Mar - May
   
Modeled
   
Modeled
 
                           
Net
               
Weighted
   
CPR
   
2019 CPR
   
Interest
   
Interest
 
               
%
         
Weighted
               
Average
   
(1-Month)
   
(3-Month)
   
Rate
   
Rate
 
   
Current
   
Fair
   
of
   
Current
   
Average
               
Maturity
   
(Reported
   
(Reported
   
Sensitivity
   
Sensitivity
 
Type
 
Face
   
Value (1)
   
Portfolio
   
Price
   
Coupon
   
GWAC
   
Age
   
(Months)
   
in Jun)
   
in Jun)
   
(-50 BPS) (2)
   
(+50 BPS) (2)
 
Pass Through RMBS
                                                                       
Post Reset ARM
 
$
1,132
   
$
1,197
     
0.03
%
 
$
105.83
     
4.78
%
   
5.22
%
   
177
     
184
     
-
     
-
   
$
7
   
$
(8
)
Fixed Rate CMO
   
665,655
     
693,481
     
19.20
%
   
104.18
     
4.26
%
   
4.60
%
   
15
     
342
     
16.85
%
   
14.18
%
   
(1,865
)
   
193
 
15yr 4.0
   
397,728
     
418,787
     
11.59
%
   
105.29
     
4.00
%
   
4.53
%
   
12
     
165
     
8.17
%
   
9.24
%
   
6,636
     
(7,145
)
15yr Total
   
397,728
     
418,787
     
11.59
%
   
105.29
     
4.00
%
   
4.53
%
   
12
     
165
     
8.17
%
   
9.24
%
   
6,636
     
(7,145
)
20yr 4.0
   
86,719
     
91,787
     
2.54
%
   
105.84
     
4.00
%
   
4.48
%
   
22
     
214
     
10.95
%
   
10.00
%
   
1,812
     
(1,938
)
20yr Total
   
86,719
     
91,787
     
2.54
%
   
105.84
     
4.00
%
   
4.48
%
   
22
     
214
     
10.95
%
   
10.00
%
   
1,812
     
(1,938
)
30yr 3.0
   
260,163
     
259,065
     
7.17
%
   
99.58
     
3.00
%
   
4.29
%
   
1
     
358
     
3.92
%
   
-
     
3,232
     
(5,599
)
30yr 3.5
   
115,498
     
119,224
     
3.30
%
   
103.23
     
3.50
%
   
4.30
%
   
9
     
348
     
9.00
%
   
8.79
%
   
1,824
     
(2,685
)
30yr 4.0
   
743,180
     
781,683
     
21.64
%
   
105.18
     
4.00
%
   
4.67
%
   
13
     
345
     
7.48
%
   
8.12
%
   
8,815
     
(13,518
)
30yr 4.5
   
259,040
     
272,845
     
7.55
%
   
105.33
     
4.50
%
   
5.24
%
   
9
     
350
     
13.85
%
   
13.51
%
   
2,340
     
(3,230
)
30yr 5.0
   
778,387
     
847,021
     
23.45
%
   
108.82
     
5.00
%
   
5.52
%
   
12
     
347
     
12.66
%
   
13.68
%
   
7,540
     
(10,109
)
30yr Total
   
2,156,268
     
2,279,838
     
63.11
%
   
105.73
     
4.27
%
   
4.98
%
   
10
     
348
     
9.90
%
   
10.81
%
   
23,751
     
(35,141
)
Total Pass Through RMBS
   
3,307,502
     
3,485,090
     
96.48
%
   
105.37
     
4.23
%
   
4.84
%
   
12
     
321
     
11.16
%
   
11.63
%
   
30,341
     
(44,039
)
Structured RMBS
                                                                                               
Interest-Only Securities
   
787,350
     
102,122
     
2.83
%
   
12.97
     
3.76
%
   
4.35
%
   
64
     
252
     
14.74
%
   
12.38
%
   
(16,417
)
   
16,261
 
Inverse Interest-Only Securities
   
212,234
     
25,121
     
0.70
%
   
11.84
     
2.67
%
   
4.86
%
   
59
     
292
     
10.98
%
   
9.99
%
   
1,250
     
(2,025
)
Total Structured RMBS
   
999,584
     
127,243
     
3.52
%
   
12.73
     
3.53
%
   
4.45
%
   
63
     
261
     
13.94
%
   
11.83
%
   
(15,167
)
   
14,236
 
Total Mortgage Assets
 
$
4,307,086
   
$
3,612,333
     
100.00
%
           
4.07
%
   
4.75
%
   
24
     
307
     
11.82
%
   
11.70
%
 
$
15,174
   
$
(29,803
)
                                                                                                 
                                                                                   
Interest
   
Interest
 
   
Average
   
Hedge
                                                                   
Rate
   
Rate
 
   
Notional
   
Period
                                                                   
Sensitivity
   
Sensitivity
 
Hedge
 
Balance
   
End
                                                                   
(-50 BPS) (2)
   
(+50 BPS) (2)
 
Eurodollar Futures
 
$
(457,143
)
 
Dec-2020
                                                                   
$
(4,000
)
 
$
4,000
 
Swaps
   
(1,710,000
)
 
Nov-2021
                                                                     
(22,166
)
   
22,166
 
5-Year Treasury Future
   
(165,000
)
 
Sep-2019 (3)
                                                                     
(4,884
)
   
3,967
 
TBA
   
(125,000
)
 
Jun-2019
                                                                     
(1,423
)
   
2,357
 
Swaptions
   
(350,000
)
 
Sep-2024
                                                                     
(949
)
   
3,763
 
Hedge Total
 
$
(2,807,143
)
                                                                         
$
(33,422
)
 
$
36,253
 
Rate Shock Grand Total
                                                                                 
$
(18,248
)
 
$
6,450
 

(1)
Amounts in the tables above include assets with a fair value of approximately $116.1 million purchased in May 2019, which settle in June 2019, and exclude assets with a fair value of approximately $448.9 million sold in May 2019, which settle in June 2019 .
(2)
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.
(3)
Five year treasury futures contracts were valued at prices of $117.37 at May 31, 2019.  The notional contract value of the short position was $193.7 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 (1)
   
Portfolio
 
Asset Category
 
Value (1)
   
Portfolio
 
As of May 31, 2019
           
As of May 31, 2019
           
Fannie Mae
 
$
2,437,653
     
67.5
%
Non-Whole Pool Assets
 
$
1,234,031
     
34.2
%
Freddie Mac
   
1,171,650
     
32.4
%
Whole Pool Assets
   
2,378,302
     
65.8
%
Ginnie Mae
   
3,030
     
0.1
%
Total Mortgage Assets
 
$
3,612,333
     
100.0
%
Total Mortgage Assets
 
$
3,612,333
     
100.0
%
                 

(1)
Amounts in the tables above include assets with a fair value of approximately $116.1 million purchased in May 2019, which settle in June 2019 and exclude assets with a fair value of approximately $448.9   million sold in May 2019, which settle in June 2019 .

Borrowings By Counterparty
               
($ in thousands)
               
           
Weighted
Weighted
 
       
% of
 
Average
Average
 
   
Total
 
Total
 
Repo
Maturity
Longest
As of May 31, 2019
 
Borrowings (1)
 
Debt
 
Rate
in Days
Maturity
Barclays Capital Inc.
$
544,359
 
14.5%
 
2.63%
12
6/12/2019
RBC Capital Markets, LLC
 
459,588
 
12.3%
 
2.67%
34
7/15/2019
Wells Fargo Bank, N.A.
 
364,390
 
9.8%
 
2.61%
39
7/22/2019
Mirae Asset Securities (USA) Inc.
 
296,255
 
8.0%
 
2.64%
116
10/9/2019
J.P. Morgan Securities LLC
 
248,692
 
6.7%
 
2.61%
159
11/12/2019
ING Financial Markets LLC
 
225,275
 
6.0%
 
2.64%
50
7/31/2019
Mitsubishi UFJ Securities (USA), Inc
 
197,351
 
5.3%
 
2.60%
121
11/12/2019
South Street Securities, LLC
 
177,058
 
4.8%
 
2.61%
248
4/9/2020
Cantor Fitzgerald & Co
 
163,878
 
4.4%
 
2.63%
60
8/12/2019
ASL Capital Markets Inc.
 
159,022
 
4.3%
 
2.61%
92
10/7/2019
ABN AMRO Bank N.V.
 
152,165
 
4.1%
 
2.64%
67
8/6/2019
Citigroup Global Markets Inc
 
137,594
 
3.7%
 
2.66%
73
8/29/2019
ICBC Financial Services LLC
 
111,211
 
3.0%
 
2.64%
51
8/12/2019
ED&F Man Capital Markets Inc
 
97,735
 
2.6%
 
2.63%
85
10/7/2019
Guggenheim Securities, LLC
 
90,357
 
2.4%
 
2.62%
91
9/30/2019
FHLB-Cincinnati
 
80,539
 
2.2%
 
2.59%
3
6/3/2019
Natixis, New York Branch
 
54,126
 
1.5%
 
2.73%
14
6/14/2019
Lucid Cash Fund USG LLC
 
48,078
 
1.3%
 
2.65%
13
6/13/2019
Bank of Montreal
 
43,839
 
1.2%
 
2.69%
16
6/27/2019
Merrill Lynch, Pierce, Fenner & Smith
 
31,290
 
0.8%
 
2.78%
21
7/1/2019
J.V.B. Financial Group, LLC
 
24,040
 
0.6%
 
2.60%
50
8/15/2019
Lucid Prime Fund, LLC
 
17,252
 
0.5%
 
2.70%
13
6/13/2019
Total Borrowings
$
3,724,094
 
100.0%
 
2.63%
70
4/9/2020

(1)
In May 2019, the Company purchased assets with a fair value of approximately $116.1 million , which settle in June 2019 that are expected to be funded by repurchase agreements.  The anticipated borrowings are not included in the table above.  In addition, the Company sold assets with a fair value of approximately $448.9 million, which settle in June 2019 that collateralize approximately $435.4 million of repurchase agreements included in the table above.


Contact:

Orchid Island Capital, Inc.
Robert E. Cauley
3305 Flamingo Drive, Vero Beach, Florida 32963
Telephone: (772) 231-1400