Stock Incentive Plans

12 Months Ended

Dec. 31, 2014

Employee Benefits And Share Based Compensation [Abstract]

NOTE 7. STOCK INCENTIVE PLAN

In October 2012, the Company’s Board of Directors adopted and Bimini, then the Company’s sole stockholder, approved, the Orchid Island Capital, Inc. 2012 Equity Incentive Plan (the “Incentive Plan”) to recruit and retain employees, directors and other service providers, including employees of the Manager and other affiliates. The Incentive Plan provides for the award of stock options, stock appreciation rights, stock award, performance units, other equity-based awards (and dividend equivalents with respect to awards of performance units and other equity-based awards) and incentive awards. The Incentive Plan is administered by the Compensation Committee of the Company’s Board of Directors except that the Company’s full Board of Directors will administer awards made to directors who are not employees of the Company or its affiliates. The Incentive Plan provides for awards of up to an aggregate of 10% of the issued and outstanding shares of our common stock (on a fully diluted basis) at the time of the awards, subject to a maximum aggregate 4,000,000 shares of the Company’s common stock that may be issued under the Incentive Plan.

A summary of incentive share activity during the year ended December 31, 2014 is presented below:

			Weighted-	Weighted-
			Average	Average
			Grant-Date	Remaining
	Shares		Fair Value	Life
Restricted common stock, at January 1, 2014	-	$	-	-
Restricted common stock granted during the year	29,844		12.41	-
Vested during the year	(5,844)		13.16	-
Restricted common stock, at December 31, 2014	24,000	$	12.23	2.3 Years

On April 25, 2014, our Compensation Committee granted each of our non-employee directors 6,000 shares of restricted common stock subject to a three year vesting schedule whereby 2,000 shares of the award vest on the first, second and third anniversaries of the award date. Directors have all the rights of a stockholder with respect to the awards, including the right to receive dividends and vote the shares. The awards are subject to forfeiture should the director no longer be a member of the Board of Directors of the Company prior to the respective vesting dates.

During the year ended December 31, 2014, the Company recognized approximately $142,000 of share based compensation expense, including expense relating to the non-employee director restricted share grants and the value of common shares received by non-employee directors for board service, which is included under the caption directors fees and liability insurance in the Company’s statement of operations.

As of December 31, 2014, there was approximately $228,000 of unrecognized compensation expense related to unvested restricted share awards. The intrinsic value of the unvested restricted shares as of December 31, 2014 was $313,000.

On January 21, 2015, our Compensation Committee granted equity awards and agreed to pay cash bonuses of $250,000 to employees of the Manager. The equity awards were made pursuant to the terms and conditions of the Incentive Plan and consist of 11,292 shares of immediately vested Common Stock and 7,507 Performance Units. For purposes of the equity grants, the Common Stock was valued at $13.32 per share, which was the closing market price of the Common Stock on January 21, 2015. The Performance Units are earned at the rate of 10% per quarter commencing with the quarter ending March 31, 2016 and concluding with the quarter ending June 30, 2018. The Grantee must continue to serve as an executive officer of the Company as of the end of each such quarter, and the performance objectives (as defined) must have been achieved, in order to receive the number of Performance Units that may be earned on that date. When earned, each Performance Unit shall be settled by the issuance of one share of the Company’s Common Stock, at which time the Performance Unit shall be cancelled. The Performance Units contain dividend equivalent rights which entitle the Participants to receive distributions declared by the Company on Common Stock.