Company: TWO-PC
Filing Date: 2025-04-02
Form Type: DEF 14A
Source: 0001465740-25-000090
Chunk: 27

Company: TWO HARBORS INVESTMENT CORP.
Filing Date: 2025-04-02
Form: DEF 14A
Chunk 27
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 is important to compensate our named executive officers with a compensation package that balances short- and long-term compensation and cash and equity-based compensation. As described in more detail below in “ Peer and Competitive Market Positioning ” on page 36 , the Compensation Committee designed and implemented a compensation program that is based on competitive pay practices within our industry and broader financial services companies.

The compensation framework for our named executive officers includes three primary elements: base salary, annual cash incentive compensation and long-term equity incentive compensation. These elements are summarized on the following page.

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| Element               |     | Key Characteristics                                                                                                                                                                                                                                                                                                                   |     | Compensation Philosophy                                                                                                                                                                                                                                                  |
| Base Salary           |     | A fixed amount, paid in cash and reviewed annually; and, if appropriate, adjusted.                                                                                                                                                                                                                                                    |     | Provide a source of fixed income that is market competitive and reflects the role and responsibilities of the position held and the performance and contributions of the individual.                                                                                     |
| Annual Cash Incentive |     | A variable, short-term compensation element that is payable in cash based on achievement of key pre-established annual corporate financial and non-financial goals as well as individual goals that support our business.                                                                                                             |     | Motivate and reward our executive officers for achievement of annual goals intended to drive overall company performance.                                                                                                                                                |
| Long-Term Incentives  |     | A variable, long-term compensation element that is provided in the form of performance share units (PSUs) and time-vested restricted stock units (RSUs). PSUs vest only upon achievement of corporate financial goals after a 3-year performance period. RSUs are time-based and vest ratably over 3 years with continued employment. |     | Align the interests of our executive officers with our stockholders; encourage focus on company performance measures that drive sustained long-term value creation; promote retention of our executive officers and encourage significant ownership of our common stock. |

These three compensation elements provide the Compensation Committee with the tools to structure executive compensation with a mix of fixed pay and variable pay that is at-risk, commensurate with the company’s structure as an internally managed company. We describe each of these elements as well as the 2024 compensation of our executive officers in detail below.

#### Pay Levels and Mix
A significant portion of our executive officers’ target total direct compensation is comprised of short- and long-term variable performance-based, or at-risk, compensation to directly link pay to performance. Generally, higher level executive positions have