Good morning and welcome to the First Quarter 2013 Earnings Conference Call for Orchid Island Capital Incorporated. This call is being recorded today Friday May 3, 2013. At this time, the company would like to remind the listeners that statements made during today’s conference call, relating to matters that are not historical facts are forward-looking statements subject to safe-harbor provisions on the Private Securities Litigation Reform Act of 1995. This is now cautioned that such forward-looking statements are based on information currently available on the management's good faith belief with respect to future events, and are subject to risks and uncertainties that could cause actual performance or results to differ materially from those expressed in such forward-looking statements. Important factors that could cause such differences are described in the company’s filings with the Securities and Exchange Commission, including the company’s most recent Annual Report on Form 10-K. The company assumes no obligation to update such forward-looking statements to reflect actual results, changes in assumptions or changes in other factors affecting forward-looking statements. Now I would like to turn the conference over to the company’s Chairman and Chief Executive Officer, Mr. Robert Cauley. Please go ahead sir.

Thank you, operator. Good morning and thank you for taking the time to join us this morning. With me this morning is Hunter Haas, the Chief Investment Officer and Chief Financial Officer. I would like to advise our listeners that we will be happy to answer any number of questions you might have regarding our results of operations in the Q&A session at the end of my prepared remarks. I would like to take a few moment to talk about market developments over the quarter and then spend some time discussing this press release taking with the portfolio not just with regard to deploying the capital raised in IPO but also in reaction to market developments and how we are positioned going forward. I will conclude my prepared remarks with some comments on our earnings for the quarter. The agency MBS market was impacted late in the third quarter of 2012 when the Federal Reserve announced the third round of quantitative easing or QE3. The Federal Reserve began purchasing $40 billion per month of Agency MBS plus reinvested pay downs on their existing Agency MBS portfolio back into additional Agency MBS. The program is expected to remain in place until economic activity specifically the level of appointment improves. During the fourth quarter of 2012, Agency NBS prices slowed off slightly after the initial spike upwards in price in late September. This trend continued into the first quarter of 2013 as economic data improved interest rates climbed in early March. However, this trend reversed mid March and NBS prices have rebounded into April. Third year currently planned mortgages, currently trade at approximately the same level we handed last year. Economic data has turned soft again and coupled with re-emergence of troubles in Europe has led interest rates on U.S. Treasuries back…

Thank you (Operator Instructions) We have a question from David Walrod of Ladenburg. Your line is open. David Walrod – Ladenburg Thalmann: Hello.

Yes, you are on. David Walrod – Ladenburg Thalmann: Perfect guys. I wanted to go through the $400,000 losses that you have on your income statement. Can you break that out and you said it's broken out between mark-to-market losses, gains on securities and funding hedges. Can you break out each of those buckets for me please?

Sure. Let me get in front of me. I can talk about the top of about – the funding hedge was about $484,000 loss. David Walrod – Ladenburg Thalmann: Okay.

Then with respect to gain, we had a gain on the sale of low under $100,000. David Walrod – Ladenburg Thalmann: Okay.

And then we had on mark-to-market with respect to the IOs and inverse IOs, it was a positive $393,000. And then on the pass-throughs those two numbers that’s a pure mark-to-market number of $163,000. And then there is about another $260,000 which is just premium loss. Since we don’t exclusively amortize premium, we capture that through pay down in the mark-to-market. Okay so the $163,000 is just general mark-to-market. David Walrod – Ladenburg Thalmann: Right.

And then what was the second number? David Walrod – Ladenburg Thalmann: $260,000 and that serves as premium amortization.

Yes, effectively. David Walrod – Ladenburg Thalmann: Okay so there’s positive mark-to-market on the IOs and IIOs and then a negative mark-to-market on the pass-throughs and actually I have given you a breakdown of that with respect to the two structures, inverses were down and price slightly, was about $43,000 loss and the IOs were up about $436,000. Okay. The other question I had was in regards to the expense line as far as the audit and professional fees as well as the G&A, I guess what was going on there, I was under the impression that those would not be allocated to work it until the company grew to a larger size.

Overhead costs are not allocated, but direct company costs are audit. Most of that number that you are referring to is the professional fees is the audit [XPDO], the 10-K, most of that was actually three IPOs actually. David Walrod – Ladenburg Thalmann: Okay.

Because we had the way it was working Dave is that, we were having audits done, we work in a level even though it was not public and so as we approach year-end we weren’t sure when exactly we would get an IPO done. So we hadn’t accrued anything for the audit fee, then we did crude at the year end and it look like we're going to go ahead with the IPO, those costs were actually booked free IPO and that's about 120,000 of that. Subsequent to that, once we became public on February 20, we put in place a new engagement letter with the auditors going forward and we’ll start accruing with that. That is a direct company cost that is not something that’s subject to the overhead sharing agreement which as you mentioned the $100 million cut off. David Walrod – Ladenburg Thalmann: Okay. Thanks for clearing that up, and that's all from me. Thanks a lot.

Hey David, if you have any more, please call we’ll be here all day. David Walrod – Ladenburg Thalmann: Okay, thanks.

Thank you (Operator Instructions) Our next question is from Terry Mcevoy of Oppenheimer. Your line is open. Terry Mcevoy – Oppenheimer & Co.: Hi, good morning.

Good morning. Terry Mcevoy – Oppenheimer & Co.: About 52% of your capital allocated towards the pass-through portfolio. I’m just wondering if you give us a better understanding of what you need to see or what you are looking at from a macro perspective before you bring that down and increased the structure to MBS portfolio and any sort of timing of that shift?

I’ll give you my comments and I’ll turn that over to Hunter. It’s a bigger – as you alluded to, it’s a big picture decision. We are looking at the end of the day, the profile of the portfolio, the sensitivity of the entire portfolio to rise. And we try to get as close to zero as we can and the way we do that is a combination of basically three tools. Pass-through is what you got the most, pass-through portfolio which is generally income generating vehicle only. Then you have funding hedges which can play a role of a asset hedge and in the structured securities. And so depending on market conditions, what’s available in the market, the types of assets on the structured that are available to us at any given time, we will be able to derive from that information just how much protection we can get and at what cost. So for instance, if you were going back into late fourth quarter of 2012, IO pass-through are really (inaudible). So if you are looking at a lot of upgrade protection from IOs, you are accepting negative yields in many cases of very, very low single digit yields. And so you might decide that time to use your funding hedge a little more than you would otherwise. Since that time, prices on IOs have softened up a little bit, now you can get more attractive yields and we could still get that upright protection. So the big picture item before I turn – on characterization before I turn over to Hunter is just that, we are looking at the end of the day to try to create a flat profile using these three tools and we basically look at what the market offers us in any time and that pretty much determine how we use those tools in what relative proportion.

I would just add, I agree with all Bob said and I would just add that, as rates become lower and lower as we’ve seen since the fall of last year. We’ll tend to allocate more towards the pass-through book. The funding hedges we use have a little more convexity when they are found by zero so to speak. So in other words we have very limited downside using those traditional hedges, swaps and your balance sheet just only go down to a zero rate and the upside looks a lot better. So we can hedge a little bit more than mortgage convexity how using those types of estimates. We think we’ve seen peak speeds and to the extent that the IO market has adjusted in price and isn’t quite as tight it was, which is something that we’ve actually sort of witnessed in the month of April, and I guess coming in at early May, we’ve seen a little bit of distraction in the structured products market, especially (inaudible). We will opportunistically shift back a little bit of that allocation more destruction products to the extent that we can continue to meet our earnings and risk management objectives. Terry Mcevoy – Oppenheimer & Co.: Thanks. And just a follow-up, I understand the strategy of protecting book value rising rate leverage. Could you just maybe quantify what you sacrifice from an ROE perspective from having that strategy just so we can compare it to some other companies out there to get more of a balanced view of those strategies and maybe some of the short-term sacrifices to have the protection and the balanced strategy that you guys has talked about?

Sure. The environment for the last six months have caused us fairly high. The structured securities portfolio, under what I won’t call normal market conditions, that is pretty allusive term to define at the moment. The free crisis that's going back away, but those securities would typically generate yields in this mid-teens on average and sometimes you can buy a structure at IO would have a yield in the 20’s and the trust IOs which are the most liquid and safest market or may be high single digits. So on average, you could certainly get mid-teens. In this environment, those numbers are not available and so the trade off is much higher. As I said today, you can probably get mid-to-high single digits on average and in the past two portfolio getting mid-teens is very obtainable. So you’re looking at five plus points minimum sacrifice to get that kind of protection and it was higher late 2012. Terry Mcevoy – Oppenheimer & Co.: Right, very helpful. Thanks guys.

Thank you. There are no further questions at this time. I like to turn the call over to Mr. Cauley for any closing remarks.

Thanks. Everybody I appreciate your time taken to listen. To the extent anybody has any additional questions or if they happen to listen to the replay, something was unclear, you want to ask additional question that was not asked today, please be sure we will be available all day and into next week. So I thank you for your time and again anybody has any additional questions, please feel free to call the office, we are glad to go over pretty much anything you can ask. Thank you, operator.

Ladies and gentlemen, thank you for your participation in today’s conference. This concludes the program. You may now disconnect. Have a wonderful day.