ITEM 1.01. ENTRY INTO A MATERIAL DEFINITIVE AGREEMENT.
Effective as of
wholly-owned subsidiary of
Orchid Island Capital, Inc. (“Orchid”) entered into a Third Amendment (the
“Amendment”) to the Management Agreement between the Manager and Orchid dated
Pursuant to the Agreement, the Manager performs management and other activities
relating to the mortgage-backed securities portfolio, business activities and
day-to-day operations of Orchid as set forth in the Management Agreement, and
provides Orchid with its management team. In consideration for such services,
the Manager receives management fees as well as reimbursement of certain costs
and expenses. Certain repurchase agreement trading, clearing and administrative
services have been provided to Orchid by
7 of the Agreement, Orchid is required to pay the fees for such services
directly to AVM.
Pursuant to the Amendment, Orchid and the Manager have agreed the services that
are currently performed by AVM will be performed by the Manager. The Company has
hired
currently handled by AVM. The transition of such services from AVM to the
Manager shall occur on the first business day immediately after the termination
of Orchid’s arrangements with AVM, which the Company currently expects will
occur on approximately
Pursuant to the Amendment, following termination of the AVM arrangements and in
consideration for the repurchase agreement trading, clearing and administrative
services being performed by the Manager, Orchid will pay the following fees to
the Manager:
?A daily fee for repurchase agreement funding transaction services that is based
on the outstanding principal balance of Orchid’s repurchase agreement funding.
The fee for each day shall be equal to the product of the outstanding principal
balance of repurchase agreement funding in place as of the end of such day and
the applicable basis point factor set forth in Appendix A of the Amendment,
divided by 360; and
?A fee for the clearing and operational services provided by personnel of the
Manager equal to
Pursuant to the Amendment, Orchid is also required to pay its allocable share of
fees incurred for safekeeping, transactions and cash services provided to Orchid
by the Bank of New York Mellon (the “BNYM Fee”) directly to the Bank of New York
Mellon. Orchid’s allocable share of the BNYM Fee shall be equal to Orchid’s
percentage of all assets under management by the Manager, inclusive of the
Company’s assets (measured as of the first day of each month).
The foregoing description of the Amendment is not complete and is qualified in
its entirety by reference to the entire Amendment, a copy of which is attached
hereto as Exhibit 10.1 and incorporated herein by reference.
ITEM 7.01. REGULATION FD DISCLOSURE.
The Company also issued a press release today announcing that
hired by the Company and that the repurchase agreement funding services and
clearing and operational functions currently handled by AVM are being
internalized by the Manager and will be handled by employees of the Manager
following a transition period. This press release is attached hereto as Exhibit
99.1 and is incorporated herein by reference.
The information referenced in this Item 7.01 (including Exhibit 99.1 referenced
in Item 9.01 below) is being “furnished” under this Item 7.01. Regulation FD
Disclosure and, as such, shall not be deemed to be “filed” for the purposes of
Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise
subject to the liabilities of that Section and shall not be incorporated by
reference into any registration statement or other document filed by the Company
pursuant to the Securities Act of 1933, as amended, except as shall be expressly
set forth by specific reference in such filing.
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
timing of the transition
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of services from AVM to the Manager. 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
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. EXHIBITS. (d)Exhibits Exhibit No. Description 10.1 Third Amendment to Management Agreement, effective as ofNovember 16, 2021 99.1 Press Release datedNovember 17, 2021 104 Cover Page Interactive Data File (embedded within the Inline XBRL document)
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