Dynex Capital Inc.
09/29/2026 | Press release | Distributed by Public on 09/29/2026 14:13
Corporate Action, Amendments to Bylaws (Form 8-K)
Item 3.03 Material Modifications to Rights of Security Holders.
As previously disclosed, on September 22, 2026, Dynex Capital, Inc. (the "Company"), entered into an underwriting agreement (the "Underwriting Agreement") with Morgan Stanley & Co. LLC, J.P. Morgan Securities LLC, RBC Capital Markets, LLC, UBS Securities LLC, Wells Fargo Securities, LLC, Citigroup Global Markets Inc., Goldman Sachs & Co. LLC and Keefe, Bruyette & Woods, Inc., acting as representatives of the several underwriters listed on Schedule 1 thereto (collectively, the "Underwriters"), pursuant to which the Company agreed to issue and sell an aggregate of 4,800,000 shares (the "Underwritten Shares") of 9.375% Series D Fixed-Rate Cumulative Redeemable Preferred Stock (the "Series D Preferred Stock"), par value $0.01 per share, with a liquidation preference of $25.00 per share, in an underwritten public offering (the "Offering"). Pursuant to the Underwriting Agreement, the Company also granted the Underwriters a 30-day option to purchase up to an additional 720,000 shares of Series D Preferred Stock on the same terms and conditions (the "Option Shares" and together with the Underwritten Shares, the "Shares").
In connection with the Offering, the Company filed the Articles of Amendment with the Virginia State Corporation Commission, which became effective on September 29, 2026. The Articles of Amendment designate 5,520,000 shares of the Company's authorized but unissued preferred stock as shares of the Company's 9.375% Series D Preferred Stock with the terms, including preferences, limitations and relative rights, set forth in the Articles of Amendment.
The Articles of Amendment provide that the Company will pay, when and as declared by its Board of Directors out of funds legally available for that purpose, quarterly cumulative dividends on the Series D Preferred Stock, in arrears, on January 15, April 15, July 15 and October 15 of each year (provided that if any dividend payment date is not a business day, then the dividend which would otherwise have been payable on that dividend payment date may be paid on the next succeeding business day) commencing January 15, 2027 (long first dividend period) to holders of record on the applicable record date, from, and including, September 29, 2026 (the "Original Issue Date"), at a fixed rate equal to 9.375% of the $25.00 liquidation preference per share of the Series D Preferred Stock per annum (equivalent to $2.34375 per annum per share).
The Series D Preferred Stock will rank, with respect to rights to the payment of dividends and the distribution of assets in the event of any liquidation, dissolution or winding up of the Company, (i) senior to all classes or series of the Company's common stock and to all other equity securities issued by the Company other than equity securities referred to in clauses (ii) and (iii) of this sentence, (ii) on parity with the Company's 6.900% Series C Fixed-to-Floating Rate Cumulative Redeemable Preferred Stock (the "Series C Preferred Stock") and all equity securities issued by the Company with terms specifically providing that those equity securities rank on parity with the Series D Preferred Stock with respect to rights to the payment of dividends and the distribution of assets upon any liquidation, dissolution or winding up of the Company, (iii) junior to all equity securities issued by the Company with terms specifically providing that those equity securities rank senior to the Series D Preferred Stock with respect to rights to the payment of dividends and the distribution of assets upon any liquidation, dissolution or winding up of the Company, and (iv) junior to all of the Company's existing and future indebtedness (including indebtedness convertible to the Company's common stock or preferred stock), including under repurchase agreements, and effectively junior to the indebtedness of the Company's existing subsidiaries and any future subsidiaries.
The Series D Preferred Stock is not redeemable prior to October 15, 2031, except upon a "Change of Control" (as defined in the Articles of Amendment), and except that the Company may purchase or redeem shares of the Series D Preferred Stock prior to that date in order to preserve the Company's qualification as a real estate investment trust ("REIT") for federal income tax purposes or to protect the tax status of one or more real estate mortgage investment conduits ("REMICs") in which the Company has acquired or plans to acquire an interest or avoid the direct or indirect imposition of a penalty tax on the Company.
On and after October 15, 2031, the Company may, at its option, redeem any or all of the shares of the Series D Preferred Stock at $25.00 per share plus any accumulated and unpaid dividends to, but not including, the redemption date. In addition, upon the occurrence of a Change of Control, the Company may, at its option, redeem any or all of the shares of Series D Preferred Stock within 120 days after the first date on which such Change of Control occurred at $25.00 per share plus any accumulated and unpaid dividends to, but not including, the redemption date.
Upon the occurrence of a Change of Control, each holder of Series D Preferred Stock will have the right (subject to the Company's election to redeem the Series D Preferred Stock in whole or in part, as described above, prior to the Change of Control Conversion Date (as defined in the Articles of Amendment)) to convert some or all of the Series D Preferred Stock held by such holder into a number of shares of the Company's common stock per share of Series D Preferred Stock determined by formula, in each case, on the terms and subject to the conditions described in the Articles of Amendment, including provisions for the receipt, under specified circumstances, of alternative consideration.
The Series D Preferred Stock has no stated maturity, is not subject to any sinking fund or mandatory redemption and will remain outstanding indefinitely unless repurchased or redeemed by the Company or converted into the Company's common stock in connection with a Change of Control by the holders of Series D Preferred Stock.
The restrictions on ownership and transfer in Article VI and Article VII of the Restated Articles of Incorporation, as amended, apply to the Series D Preferred Stock in order to protect the Company's status as a REIT for federal income tax purposes, and to protect the tax status of one or more REMICs in which the Company has acquired or plans to acquire an interest or to avoid the direct or indirect imposition of a penalty tax on the Company.
Holders of Series D Preferred Stock generally have no voting rights. However, whenever dividends on any shares of Series D Preferred Stock are in arrears for six or more quarterly dividend periods, whether or not consecutive, the number of directors constituting the Company's Board of Directors will be automatically increased by two (if not already increased by two by reason of the election of directors by the holders of any other class or series of preferred stock the Company may issue upon which like voting rights have been conferred and are exercisable and with which the Series D Preferred Stock is entitled to vote as a voting group with respect to the election of those two directors) and the holders of Series D Preferred Stock (voting separately as a voting group with all other classes or series of preferred stock the Company may issue upon which like voting rights have been conferred and are exercisable (including holders of the Series C Preferred Stock, if applicable) and which are entitled to vote as a voting group with the Series D Preferred Stock in the election of those two directors) will be entitled to vote for the election of those two additional directors. Such voting rights will continue until all dividends accumulated on the Series D Preferred Stock for all past dividend periods and the then current dividend period shall have been fully paid or declared and a sum sufficient for the payment thereof set aside for payment.
Holders of Series D Preferred Stock have limited voting rights in certain other circumstances as delineated in the Articles of Amendment.
On each matter on which holders of Series D Preferred Stock are entitled to vote, each share of Series D Preferred Stock will be entitled to one vote, except that when shares of any other class or series of preferred stock have the right to vote with the Series D Preferred Stock as a single voting group on any matter, the Series D Preferred Stock and the shares of each such other class or series will have one vote for each $25.00 of liquidation preference (excluding accumulated dividends).
As of the date of this Current Report on Form 8-K, there are 4,460,000 shares of Series C Preferred Stock outstanding. Other than the Series C Preferred Stock, the Company has no other outstanding preferred stock.
A copy of the Articles of Amendment and a specimen of Series D Preferred Stock certificate are filed as Exhibits 3.1 and 4.1, respectively, hereto and incorporated herein by reference. The description of the terms of the Articles of Amendment in this Item 3.03 is qualified in its entirety by reference to Exhibit 3.1.
Item 5.03. Amendments to Articles of Incorporation or Bylaws; Change in Fiscal Year.
The information about the Articles of Amendment set forth under Item 3.03 of this Current Report on Form 8-K is hereby incorporated by reference into this Item 5.03.
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