CAPITAL STOCK

(A)Common Stock

The following table provides a summary of the Company’s common shares authorized and issued and outstanding at September 30, 2018 and December 31, 2017.

Shares authorized

Shares issued and outstanding

September 30, 2018

December 31, 2017

September 30, 2018

December 31, 2017

Par Value

Common stock

1,924,050,000

1,929,300,000

1,303,079,555

1,159,585,078

$0.01

The Company issued 43.6 million shares of common stock as part of the consideration for the MTGE Acquisition.

During the three and nine months ended September 30, 2018, the Company closed the public offering of an original issuance of 75.0 million shares of common stock for proceeds of approximately $753.8 million before deducting offering expenses. In connection with the offering, the Company granted the underwriters a thirty-day option to purchase up to an additional 11.3 million shares of common stock, which the underwriters exercised in full resulting in an additional $113.1 million in proceeds before deducting offering expenses.

During the three and nine months ended September 30, 2017, the Company closed the public offering of an original issuance of 60.0 million shares of common stock for proceeds of approximately $709.8 million before deducting offering expenses. In connection with the offering, the Company granted the underwriters a thirty-day option to purchase up to an additional 9.0 million shares of common stock, which the underwriters exercised in full resulting in an additional $106.5 million in proceeds before deducting offering expenses.

No options were exercised during the nine months ended September 30, 2018 and 2017.

The following table provides a summary of activity related to the Company’s Direct Purchase and Dividend Reinvestment Program.



	Nine Months Ended
	September 30, 2018		September 30, 2017
	(dollars in thousands)
Shares issued through direct purchase and dividend reinvestment program	245,000		169,000
Amount raised from direct purchase and dividend reinvestment program	$	2,584	$	1,949

In January 2018, the Company entered into separate Distribution Agency Agreements (collectively, the “Sales Agreements”) with each of Wells Fargo Securities, LLC, Merrill Lynch, Pierce, Fenner & Smith, Incorporated, Barclays Capital Inc., Citigroup Global Markets Inc., Credit Suisse Securities (USA) LLC, Goldman Sachs & Co. LLC, J.P. Morgan Securities LLC, Keefe, Bruyette & Woods, Inc., RBC Capital Markets, LLC and UBS Securities LLC (the “Sales Agents”). The Company may offer and sell shares of its common stock, having an aggregate offering price of up to $1.5 billion from time to time through any of the Sales Agents. During the nine months ended September 30, 2018, the Company issued 24.0 million shares under the at-the-market sales program for proceeds of $251.1 million, net of commissions and fees.

(B)Preferred Stock

The following is a summary of the Company’s cumulative redeemable preferred stock outstanding at September 30, 2018 and December 31, 2017. In the event of a liquidation or dissolution of the Company, the Company’s then outstanding preferred stock takes precedence over the Company’s common stock with respect to payment of dividends and the distribution of assets.



	Shares authorized		Shares issued and outstanding		Carrying value				Contractual rate	Earliest redemption date ⁽¹⁾	Date at which dividend rate becomes floating	Floating annual rate
	September 30, 2018	December 31, 2017	September 30, 2018	December 31, 2017	September 30, 2018		December 31, 2017		Contractual rate	Earliest redemption date ⁽¹⁾	Date at which dividend rate becomes floating	Floating annual rate
Fixed-rate:		(dollars in thousands)
Series C	7,000,000	12,000,000	7,000,000	12,000,000	$	169,466	$	290,514	7.625%	5/16/2017	NA	NA
Series D	18,400,000	18,400,000	18,400,000	18,400,000	445,457		445,457		7.50%	9/13/2017	NA	NA
Series E	—	11,500,000	—	11,500,000	—		287,500		7.625%	8/27/2017	NA	NA
Series H	2,200,000	—	2,200,000	—	55,000		—		8.125%	5/22/2019	NA	NA
Fixed-to-floating rate:
Series F	28,800,000	28,800,000	28,800,000	28,800,000	696,910		696,910		6.95%	9/30/2022	9/30/2022	3M LIBOR + 4.993%
Series G	19,550,000	—	17,000,000	—	411,335		—		6.50%	3/31/2023	3/31/2023	3M LIBOR + 4.172%
Total	75,950,000	70,700,000	73,400,000	70,700,000	$	1,778,168	$	1,720,381


⁽¹⁾	Subject to the Company’s right under limited circumstances to redeem preferred stock earlier in order to preserve its qualification as a REIT or under limited circumstances related to a change in control of the Company.

Each series of preferred stock has a par value of $0.01 per share and a liquidation and redemption price of $25.00, plus accrued and unpaid dividends through their redemption date. Through September 30, 2018, the Company had declared and paid all required quarterly dividends on the Company’s preferred stock.

During the nine months ended September 30, 2018, the Company issued 17,000,000 shares of its 6.50% Series G Preferred Stock for gross proceeds of $425.0 million before deducting the underwriting discount and other estimated offering expenses and 2,200,000 shares of its Series H Preferred Stock in connection with the acquisition of MTGE Investment Corp. Refer to the “Acquisition of MTGE Investment Corp.” Note for additional information related to the Company’s Series H Preferred Stock.

During the nine months ended September 30, 2018, the Company redeemed 5,000,000 shares of its Series C Preferred Stock for $125.0 million and all 11,500,000 of its issued and outstanding shares of Series E Cumulative Redeemable Preferred Stock (“Series E Preferred Stock”) for $287.5 million.

On August 25, 2017, the Company redeemed all 7,412,500 of its issued and outstanding shares of 7.875% Series A Cumulative Redeemable Preferred Stock (“Series A Preferred Stock”) for $187.5 million.

The Series C Preferred Stock, Series D Preferred Stock, Series F Preferred Stock, Series G Preferred Stock and Series H Preferred Stock rank senior to the common stock of the Company.

(C)Distributions to Stockholders

The following table provides a summary of the Company’s dividend distribution activity for the periods presented:



	Nine Months Ended
	September 30, 2018		September 30, 2017
	(dollars in thousands, except per share data)
Distributions declared to common stockholders	$	1,062,685	$	937,825
Distributions declared per common share	$	0.90	$	0.90
Distributions paid to common stockholders after period end	$	102,811	$	326,425
Distributions paid per common share after period end	$	0.08	$	0.30
Date of distributions paid to common stockholders after period end	October 31, 2018		October 31, 2017
Dividends declared to Series A Preferred stockholders	$	—	$	9,527
Dividends declared per share of Series A Preferred Stock	$	—	$	1.477
Dividends declared to Series C Preferred stockholders	$	10,987	$	17,157
Dividends declared per share of Series C Preferred Stock ⁽¹⁾	$	1.430	$	1.430
Dividends declared to Series D Preferred stockholders	$	25,875	$	25,875
Dividends declared per share of Series D Preferred Stock	$	1.406	$	1.406
Dividends declared to Series E Preferred stockholders	$	2,253	$	16,441
Dividends declared per share of Series E Preferred Stock	$	0.196	$	1.430
Dividends declared to Series F Preferred stockholders	$	37,530	$	—
Dividends declared per share of Series F Preferred Stock⁽²⁾	$	1.303	$	—
Dividends declared to Series G Preferred stockholders	$	19,875	$	—
Dividends declared per share of Series G Preferred Stock	$	1.169	$	—
Dividends declared to Series H Preferred stockholders	$	298	$	—
Dividends declared per share of Series H Preferred Stock	$	0.135	$	—


⁽¹⁾	Includes dividends declared per share for shares outstanding at September 30, 2018.


⁽²⁾	Includes cumulative and undeclared dividends on the Company’s Series F Preferred Stock of $8.3 million for the nine

months ended September 30, 2017.