Company: TWO-PC
Filing Date: 2025-04-29
Form Type: 10-Q
Source: 0001465740-25-000104
Chunk: 163

Company: TWO HARBORS INVESTMENT CORP.
Filing Date: 2025-04-29
Form: 10-Q
Item: Item 8
Chunk 163
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VESTMENT CORP.Notes to the Consolidated Financial Statements (unaudited)

The estimated fair value of RSUs on grant date is based on the closing market price of the Company’s common stock on the NYSE on such date. The shares underlying RSUs granted to independent directors are subject to a one-year vesting period. RSUs granted to certain eligible employees vest in three equal annual installments commencing on the first anniversary of the grant date, as long as such grantee complies with the terms and conditions of the applicable RSU agreement. All RSUs entitle the grantee to receive dividend equivalent rights, or DERs, during the vesting period. A DER represents the right to receive a payment equal to the amount of cash dividends declared and payable on the grantee’s unvested and outstanding equity incentive awards. In the case of RSUs, DERs are paid in cash within 60 days of the quarterly dividend payment date based on the number of unvested and outstanding RSUs held by the grantee on the applicable dividend record date. In the event that an RSU is forfeited, the related DERs which have not yet been paid shall be forfeited.Performance Share UnitsThe following table summarizes the activity related to PSUs for the three months ended March 31, 2025 and 2024:Three Months Ended March 31,20252024Target UnitsWeighted Average Grant Date Fair Market ValueTarget UnitsWeighted Average Grant Date Fair Market ValueOutstanding at Beginning of Period652,770 $19.58 485,822 $24.89 Granted390,662 13.29 292,000 16.19 Vested(90,051)(21.83)(60,777)(34.68)Forfeited(80,153)(21.00)(43,959)(34.68)Outstanding at End of Period873,228 $16.40 673,086 $19.60 The estimated fair value of PSUs on grant date is determined using a Monte Carlo simulation. PSUs vest promptly following the completion of a three year performance period, as long as such grantee complies with the terms and conditions of the applicable PSU award agreement. The number of underlying shares of common stock that vest and that the grantee becomes entitled to receive at the time of vesting will be determined based on the level of achievement of certain Company performance goals during the performance period and will generally range from 0% to 200