Third Amendment to Management Agreement, effective as of November 16, 2021

EX-10.1 2 orc8k20211117x101.htm EXHIBIT 10.1 orc8k20211117x101

THIRD AMENDMENT TO

MANAGEMENT AGREEMENT

THIS THIRD AMENDMENT TO MANAGEMENT AGREEMENT

(the “

Amendment

”) is

entered into effective as of November 16, 2021 (the “

Effective Date

”), by and between Orchid Island

Capital, Inc., a Maryland corporation (the “

Company

”), and Bimini Advisors, LLC, a Maryland limited

liability company (“

Manager

”). Capitalized terms used but not defined in this Amendment shall have

the meanings set forth in the Agreement (as defined below).

W I T N E S S E T H:

WHEREAS

, the Company and the Manager entered into a Management Agreement effective as

of February 20, 2013, the First Amendment to Management Agreement effective as of April 1, 2014 and

the Second Amendment to Management Agreement effective as of June 30, 2014 (collectively,

the

“

Agreement

”);

WHEREAS

, the execution of repurchase agreement funding transactions and certain clearing

and operational functions related to the Company’s trading activities are currently handled by AVM,

L.P.

(“

AVM

”), with the Company paying for such services directly to AVM;

WHEREAS

, Section 7 of the Agreement includes the following language relating to such

payment by the Company directly to AVM

(the “

AVM

Language

”):

“

For the avoidance of doubt, payment for all services provided to the Company by AVM, L.P.

(including repurchase agreement

trading, clearing and administrative services) shall be made by the

Company directly to AVM,

L.P.

”;

WHEREAS

, in connection with the Manager hiring an individual experienced in the execution

of repurchase agreement funding transactions and related clearing and operational functions, 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;

WHEREAS

, the Company will terminate its agreements with AVM

according to the terms

thereof; and

WHEREAS

, the Company and the Manager now desire to amend the Agreement on the terms

set forth herein.

NOW

THEREFORE

, in consideration of the premises and agreements contained herein, and

for other good and valuable consideration, the receipt and sufficiency of which are expressly

acknowledged, the parties hereby amend and modify the Agreement in the manner set forth below:

Section 2 of the Agreement is hereby amended by renumbering Sections 2(b)(xxv) and

2(b)(xxvi) as Sections 2(b)(xxvi) and 2(b)(xxvii), respectively, and by adding the following new

Section 2(b)(xxv) of the Agreement as follows:

“(xxv) performing repurchase agreement trading and certain clearing and operations services;”

Section 7(a) of the Agreement is hereby deleted and replaced by the following:

“(a) Except as provided in Section 7(b)(xx) and 7(b)(xxi), the Manager shall be responsible for

(i) the expenses related to any and all personnel of the Manager and its Affiliates who provide

services to the Company pursuant to this Agreement or to the Manager pursuant to the Overhead

Sharing Agreement (including each of the officers of the Company and any directors of the

Company who are also directors, officers, employees or agents of the Manager, Bimini or any of

their Affiliates), including, without limitation, salaries, bonus and other wages, payroll taxes and

the cost of employee benefit plans of such personnel, and costs of insurance with respect to such

personnel and (ii) all other costs and expenses payable by the Manager under the Overhead

Sharing Agreement.”

Section 7 of the Agreement is hereby amended by renumbering Section 7(b)(xxi) as Section

7(b)(xxiii), and by adding the following new Sections 7(b)(xxi) and 7(b)(xxii) of the Agreement as

follows:

“(xxi) beginning on the first business date immediately following the termination of the

Company’s agreements with AVM,

(a) fees for repurchase agreement funding transaction

services performed by personnel of the Manager which shall be calculated on a daily basis. The

fee for each day shall be equal to the product of (i) the outstanding principal balance of the

Company’s repurchase agreement funding in place as of the end of such day and (ii) the Basis

Point Factor, as described in Appendix A, divided by 360 ((principal * bps)/360); and

(b) a fee for the clearing and operational services provided by personnel of the Manager equal to

$10,000 per month;

(xxii) beginning on the first business date immediately following the termination of the

Company’s agreements with AVM,

the Company’s allocable share of fees incurred for

safekeeping, transactions and cash services provided by the Bank of New York

Mellon (the

“

BNYM fee

”). For purposes of this Section 7(b)(xxii), the Company’s “allocable share,” as

applied to the dollar amount of the BNYM fee, shall be equal to the Company’s percentage of all

assets under management by the Manager, inclusive of the assets of Bimini Capital Management,

Inc. (measured as of the first day of each month);”

The AVM

Language in Section 7 of the Agreement is hereby deleted in its entirety and replaced

by the following:

“

For the avoidance of doubt, payment for safekeeping, transactions and cash services provided

to the Company by the Bank of New York

Mellon shall be made by the Company directly to the

Bank of New York

Mellon.

”

Section 7(c) of the Agreement is hereby deleted in its entirety.

Section 16(a) of the Agreement is hereby amended to amend and restate the notice information

for the Company as follows:

“The Company:

Orchid Island Capital, Inc.

3305 Flamingo Drive

Vero

Beach, FL 32963

Attention: Chief Executive Officer

Fax: 772 ###-###-####

with a copy to:

Vinson & Elkins L.L.P.

2200 Pennsylvania Avenue NW

Suite 500 West

Washington, DC 20037

Attention: S. Gregory Cope, Esq.

Fax: 202 ###-###-####”

This Amendment constitutes an amendment or modification of the Agreement that is entered into

pursuant to Section 16(d) of the Agreement.

Except as set forth in this Amendment, the parties acknowledge and agree that all other terms of

the Agreement shall remain in full force and effect.

All prior agreements, promises, representations, or statements, whether oral or in writing,

regarding this Amendment are merged and integrated herein. This Amendment and the Agreement, as so

amended, constitute the entire agreement with respect to the subject matter hereof. No amendments,

waivers or modifications to the terms of the Agreement shall be valid unless set forth in writing and

signed by the Company and the Manager.

10.

This Amendment may be executed in counterparts, each of which will be deemed an original,

and all of which taken together shall constitute a single agreement.

[Signature page follows]

IN WITNESS WHEREOF

, the parties hereto have executed this Amendment as of the date

first written above.

ORCHID ISLAND CAPITAL,

INC.

By:

/s/ Robert E. Cauley

Name:

Robert E. Cauley

Title:

Chief Executive Officer

BIMINI ADVISORS, LLC

By:

/s/ George H. Haas, IV

Name:

George H. Haas, IV

Title:

Chief Financial Officer, Chief Investment Officer

and Secretary

Appendix A

Basis Point Factor

For purposes of calculating the daily fee set forth in Section 7(b)(xxi)(a) of the Agreement, (i) if

the aggregate outstanding principal balance of the Company’s repurchase agreement funding is equal to

or less than $5,000,000,000 (measured as of the end of each day), the Basis Point Factor to be applied

shall be equal to 1.5 basis points (or 0.00015) and (ii) if the aggregate outstanding principal balance of

the Company’s repurchase agreement funding is greater than $5,000,000,000 (measured as of the end of

each day), the Basis Point Factor to be applied for amounts in excess of $5,000,000,000 shall be equal to

1.0 basis points (or 0.00010).