Investor Relations

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Two Harbors Investment Corp. offers answers to frequently asked questions. Click on a specific category below. If you have additional questions, please contact Investor Relations.

Granite Point Distribution and Reverse Stock Split

On September 14, 2017, the Board of Directors of Two Harbors Investment Corp. (“Two Harbors”, the “company”, “we” or “us”) declared a special dividend (the “Stock Dividend”) to distribute the shares of common stock of Granite Point Mortgage Trust Inc. (NYSE: GPMT) (“Granite Point”) acquired by the company in connection with the contribution of its commercial real estate portfolio to Granite Point. Two Harbors also announced that its Board of Directors had approved a one-for-two reverse stock split of Two Harbors common stock (“Reverse Stock Split”). On November 1, 2017 (the “Dividend Date”), the Stock Dividend occured first, followed by the Reverse Stock Split.

Below is a summary of frequently asked questions relating to both the Stock Dividend and the Reverse Stock Split.

Stock Dividend of Granite Point Common Stock

Granite Point Distribution

Reverse Stock Split

Reverse Stock Split

  • A reverse stock split is a corporate action in which a company proportionately reduces the total number of its authorized and outstanding shares. 

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  • The Reverse Stock Split became effective at 5:01pm Eastern Time on November 1, 2017 (the “Effective Time”).  At the Effective Time, every two issued and outstanding shares of Two Harbors common stock were converted into one share of Two Harbors common stock, subject to a reduction in the total number of shares as a result of cash payments made in lieu of the issuance of fractional shares.  See the question titled “How were fractional shares of Two Harbors common stock treated in the Reverse Stock Split?”.

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  • The decision to effect the Reverse Stock Split was based on our expectation that, following the distribution of Granite Point common stock through the Stock Dividend, the market price and trading ranges for the shares of Two Harbors common stock will be significantly lower than the current market price and trading ranges.  This is due to the fact that Two Harbors distributed all of the value of Granite Point to the holders of Two Harbors common stock through the Stock Dividend.  We believe that effecting the Reverse Stock Split, which resulted in fewer shares of the Two Harbors comm

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  • Following the Reverse Stock Split, you owned one-half of the number of shares that you held prior to the Reverse Stock Split, although the shares you owned following the Reverse Stock Split continue to represent that same percentage of the total number of outstanding shares of Two Harbors common stock.  Accordingly, the proportionate ownership of Two Harbors did not change as a result of the Reverse Stock Split.

    For example:

    You own 1,000 shares of Company X, which has 1,000,000 shares of common stock outstanding (or a 0.10% percentage ownership in the company).

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  • Following the Reverse Stock Split, you owned one-half of the number of shares that you held prior to the Reverse Stock Split, although the shares you owned following the Reverse Stock Split will continue to represent that same percentage of the total number of outstanding shares of Two Harbors common stock.  Accordingly, the proportionate ownership of Two Harbors did not change as a result of the Reverse Stock Split.  

    For example:

    You own 1,000 shares of Company X, which has 1,000,000 shares of common stock outstanding (or a 0.10% percentage ownership in the company).

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  • No fractional shares were issued in connection with the Reverse Stock Split. Instead, if the Reverse Stock Split conversion resulted in a new share total that included a fractional share, the stockholder of the fractional share was entitled to receive, in lieu of such fractional share, a cash payment in an amount that is equal to the volume weighted average price of Two Harbors common stock reported on the NYSE on November 1, 2017.

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  • Following the Reverse Stock Split, the CUSIP number for Two Harbors common stock changed to 90187B408. Two Harbors common stock continues to trade on the NYSE under the ticker symbol “TWO.”

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  • The Reverse Stock Split did not impact the number of shares of Granite Point Stock that you may have been entitled to receive in connection with the Stock Dividend, as the determination of the number of shares of Granite Point Stock that you may have been entitled to receive was made prior to the Effective Time of the Reverse Stock Split. 

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  • The Reverse Stock Split will be a non-taxable event to stockholders, with the exception of cash in lieu of fractional shares.  Upon the sale of such fractional share by the distribution agent on behalf of a stockholder, such stockholder generally will recognize short-term or long-term capital gain or loss, depending on such stockholder’s holding period of Two Harbors common stock, for U.S. federal income tax purposes equal to the difference, if any, between the amount realized and the stockholders basis in the fractional share.

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  • Yes. In connection with the Reverse Stock Split, holders’ stock certificates reflecting pre-Reverse Stock Split shares of Two Harbors common stock will be required send their stock certificates to the Exchange Agent handling the Reverse Stock Split in order to receive the new post-Reverse Stock Split shares of Two Harbors common stock. Following the Reverse Stock Split, the exchange agent will send all certificate holders a letter of transmittal detailing the process for exchanging your existing stock certificates.

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