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1. Like Prologis, but instead of physical buildings, it's a landlord for mortgage-backed securities, collecting interest with high leverage.

2. A highly leveraged, specialized bond fund manager, much like a niche BlackRock that only invests in mortgage-backed securities.

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• Agency Fixed-Rate Residential Mortgage-Backed Securities (RMBS): These are debt securities backed by residential mortgages with a fixed interest rate, where principal and interest payments are guaranteed by a U.S. government agency.
• Agency Adjustable-Rate Residential Mortgage-Backed Securities (ARMBS): These are debt securities backed by residential mortgages with an interest rate that adjusts periodically, where principal and interest payments are guaranteed by a U.S. government agency.
• Agency Interest-Only (IO) and Principal-Only (PO) Strips: These are derivative securities created from Agency RMBS, where IO strips receive only interest payments and PO strips receive only principal payments from the underlying mortgage pool.

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Orchid Island Capital (ORC) is a mortgage real estate investment trust (mREIT). Unlike traditional companies that sell goods or services to customers, ORC primarily generates revenue from the interest income on its portfolio of residential mortgage-backed securities (RMBS). It does not have "customers" in the conventional sense of entities buying its products or services.

However, if "customers" are interpreted as the entities that purchase the company's equity (i.e., its shareholders) in exchange for potential returns (dividends and capital appreciation), then ORC "sells" its shares to both institutional investors (other companies) and individual investors. Given the significant institutional ownership typical of public companies like ORC, it can be considered to sell primarily to other companies (institutional investors).

Based on its major institutional holdings, the following are some of ORC's significant "customers" in this interpreted sense:

• BlackRock, Inc. (Symbol: BLK)

• The Vanguard Group, Inc. (Vanguard is a privately held investment management company, though it manages numerous publicly traded funds.)

• State Street Corp (Symbol: STT)

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• Bimini Advisors, LLC (Parent: Bimini Capital Management, Inc., Symbol: BMNM)
• Barclays PLC (Symbol: BCS)
• Bank of America Corporation (Symbol: BAC)
• Citigroup Inc. (Symbol: C)
• UBS Group AG (Symbol: UBS)
• The Goldman Sachs Group, Inc. (Symbol: GS)
• JPMorgan Chase & Co. (Symbol: JPM)
• Morgan Stanley (Symbol: MS)
• Nomura Holdings, Inc. (Symbol: NMR)
• Royal Bank of Canada (Symbol: RY)
• Wells Fargo & Company (Symbol: WFC)

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Robert E. Cauley, Chairman, President and Chief Executive Officer

Mr. Cauley has served as Chairman, President, and Chief Executive Officer of Orchid Island Capital since August 2010. He also holds the positions of Chairman and Chief Executive Officer of Orchid Island Capital's Manager. Mr. Cauley co-founded Bimini in 2003 and has served as its Chief Executive Officer and Chairman of the Board of Directors since April 2008. Prior to April 2008, he was Vice-Chairman, Chief Financial Officer, and Chief Investment Officer of Bimini. Before co-founding Bimini, Mr. Cauley was a vice-president and portfolio manager at Federated Investors from 1996 to 2003. He was also a member of the ABS/MBS structuring desk at Lehman Brothers from 1994 to 1996 and a credit analyst at Barclays Bank, PLC from 1992 to 1994. Mr. Cauley is a CPA (inactive status) and served in the United States Marine Corps for four years.

G. Hunter Haas, IV, Chief Financial Officer, Chief Investment Officer, Secretary and Director

Mr. Haas has served as Chief Financial Officer, Chief Investment Officer, and a Director of Orchid Island Capital since August 2010. He is also the President, Chief Investment Officer, and Chief Financial Officer of Orchid Island Capital's Manager and has held the same roles at Bimini since April 2008. Before these appointments at Bimini, he was a Senior Vice President and Head of Research and Trading. Mr. Haas joined Bimini in May 2004 as Vice President and Head of Mortgage Research. He has over 12 years of experience in the industry and has managed trading operations for the portfolio since his arrival in May 2004. Mr. Haas has approximately eight years of experience as a member of senior management of a public REIT. Prior to joining Bimini, he worked in the mortgage industry as part of a team responsible for hedging a servicing portfolio at both National City Mortgage and Homeside Lending, Inc.

Jerry Sintes, Vice President and Treasurer

Mr. Sintes has served as Vice President and Treasurer of Orchid Island Capital since August 2010. He has also been the Vice President and Controller of Bimini since October 2007. From January 2006 to October 2007, Mr. Sintes was Vice President and Assistant Controller of Riverside National Bank of Florida. Prior to that, he served as Chief Financial Officer of GS Financial Corp. and its subsidiary, Guaranty Savings and Homestead Association, from May 2003 to December 2005. He held various positions at Bain, Freibaum, Sagona & Co., LLP from September 1992 to May 2003 and Whitney National Bank from May 1988 to September 1992. Mr. Sintes is a graduate of Louisiana State University with a Bachelor of Science degree in Accounting and is a Certified Public Accountant.

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Key Risks to Orchid Island Capital (ORC)

1. Interest Rate Risk: Orchid Island Capital is highly susceptible to fluctuations in interest rates. Significant increases in both long-term and short-term interest rates can substantially reduce the market value of the company's Agency Residential Mortgage-Backed Securities (RMBS) investments and simultaneously increase the cost of its repurchase agreements used for financing. This can lead to reduced earnings or even losses, negatively impacting the company's ability to pay distributions to its stockholders.
2. High Leverage and Dividend Sustainability: The company operates with a highly leveraged business model, relying on borrowing short-term to finance long-duration Agency RMBS. While this amplifies returns in stable market conditions, it significantly magnifies losses and mark-to-market pressures when interest rates are volatile or move abruptly. This high leverage ratio means that even a small decline in asset value can have a substantial impact on the company's book value per share. Furthermore, Orchid Island Capital's high dividend payout ratio, which often exceeds its earnings per share, makes the dividend vulnerable to cuts, potentially leading to further pressure on the stock price and erosion of capital.
3. Market Volatility and Illiquidity of Investments: The market price of Orchid Island Capital's common stock can experience significant volatility, primarily influenced by current and anticipated future cash dividends and the company's book value. Moreover, the Agency RMBS in which the company invests, particularly structured Agency RMBS, can face periods of illiquidity. Such illiquidity can prevent the company from selling its assets at opportune times and favorable prices, which could materially and adversely affect its business, financial condition, results of operations, and its capacity to pay distributions to stockholders.

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Orchid Island Capital (ORC) operates as a specialty finance company, primarily focusing on investments in residential mortgage-backed securities (RMBS) within the United States. The company's main products are Agency RMBS, which include traditional pass-through Agency RMBS and structured Agency RMBS. These securities are backed by single-family residential mortgage loans and are guaranteed by government-sponsored entities such as Fannie Mae, Freddie Mac, or Ginnie Mae.

The addressable market for residential mortgage-backed securities (RMBS) in the U.S. is substantial. In the first quarter of 2024, the total value of outstanding mortgage-related securities in the U.S. was approximately $13.5 trillion. This market includes both agency and non-agency RMBS, with agency RMBS constituting the vast majority. The U.S. residential mortgage debt outstanding was approximately $13.3 trillion in Q1 2024.

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1. Favorable Interest Rate Environment and Yield Curve Dynamics: Expectations of continued Federal Reserve rate cuts, an end to quantitative tightening, and a positively sloped yield curve are anticipated to benefit Orchid Island Capital's funding costs and net interest margin. This environment is projected to lead to margin expansion and sustained earnings growth.
2. Strategic Portfolio Management and Expansion: Orchid Island Capital has been actively adjusting and expanding its investment portfolio. This includes increasing its allocation to higher-coupon and longer-duration residential mortgage-backed securities (RMBS), particularly 30-year RMBS with 5.5% and 6.0% coupons, and maintaining a focus on agency fixed-rate pass-through securities. Expanding the average portfolio balance by deploying capital into attractive assets is a key driver.
3. Optimized Net Interest Spread: The company's revenue generation is primarily driven by the difference between the yield on its mortgage assets and the cost of its borrowings. Management anticipates that supportive market conditions, coupled with strategic adjustments to its investment portfolio and funding, will improve the economic net interest spread, thereby enhancing net interest income.
4. Effective Capital Deployment and Leverage: Orchid Island Capital has demonstrated its ability to successfully raise and deploy capital into agency mortgage-backed securities (MBS) at attractive spreads, which directly contributes to an increased average portfolio balance and supports returns. The potential for increased leverage, particularly if anticipated rate cuts materialize, could further amplify revenue growth.

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Share Repurchases

• From its inception through September 30, 2025, Orchid Island Capital repurchased shares totaling approximately $84.8 million.
• During the nine months ended September 30, 2025, the company repurchased approximately $7.3 million in shares.
• Significant quarterly share repurchases included $20.01 million in Q4 2022 and $5.47 million in Q4 2023.

Share Issuance

• In 2025, Orchid Island Capital raised approximately $497.19 million net through its at-the-market program year-to-date.
• Under an equity distribution agreement in effect from March 2023 until its termination in June 2024, the company generated approximately $228.8 million in gross proceeds from share issuances.
• A new equity distribution agreement was entered into on June 11, 2024, authorizing the company to offer and sell up to an aggregate of $250 million of common stock.