false 0001518621 0001518621 2022-06-14 2022-06-14
 
 
 
 
 
 
 
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
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
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