Dynex Capital Boosts At-the-Market Offering Authorization by 80 Million Shares to Enhance Capital Raising Flexibility

Mortgage REIT Expands Distribution Agreement to Facilitate Capital Access

Dynex Capital, a Virginia-incorporated mortgage REIT headquartered in Glen Allen, revealed a significant amendment to its at-the-market offering program on July 28, 2026. Trading on the NYSE under ticker symbols DX (common stock) and DX-PC (Series C preferred stock), the company has consistently adjusted its share authorization through amendments since the initial agreement in June 2018. This tenth amendment underscores Dynex Capital's commitment to maintaining sufficient liquidity channels for capital raising amid fluctuating market environments.

The distribution agreement permits Dynex Capital to incrementally issue common stock via at-the-market transactions through designated sales agents at prevailing market prices, avoiding large single offerings. This approach benefits REITs and capital-intensive firms by providing steady equity market access without timing constraints typical of traditional offerings. Maintaining a substantial authorized share pool enables the company to respond flexibly to refinancing, acquisitions, or capital deployment opportunities aligned with favorable equity market conditions.

Details on Share Authorization Increase and Remaining Capacity

Effective July 28, 2026, Amendment No. 10 increased the total common shares authorized for sale under the distribution agreement by 80 million, bringing the aggregate authorization to 301,292,973 shares. Of this total, 99,326,438 shares remain available for future issuance through sales agents, representing approximately 32.9% of the total authorized capacity.

This remaining availability offers Dynex Capital significant capital raising potential over time, assuming normal market conditions and proportional usage. The filing does not disclose historical drawdown rates or specify timelines for utilizing the newly authorized shares. Investors monitoring the company may consider the balance between total authorization and remaining availability indicative of the company's pace in deploying its at-the-market capacity and potential need for future amendments.

Registration Statement and Prospectus Supplement Filings

The shares authorized under Amendment No. 10 are offered pursuant to Dynex Capital's Registration Statement on Form S-3 filed with the SEC under File No. 333-289004. Form S-3 enables streamlined disclosure for eligible public companies compared to Form S-1. A prospectus supplement dated July 28, 2026, supplements the base prospectus dated July 28, 2025, together constituting the offering materials for shares sold under the distribution agreement.

These documents provide investors with essential information about Dynex Capital's business, financial status, risk factors, and use of proceeds in compliance with federal securities laws. The timing of the prospectus supplement alongside Amendment No. 10 indicates an update to market participants on material developments prior to expanding share availability, though specific supplement content is not detailed in the filing.

Experienced Syndicate of Financial Institutions as Sales Agents

Dynex Capital’s sales agent syndicate includes BTIG, LLC; Citizens JMP Securities, LLC; Goldman Sachs & Co. LLC; JonesTrading Institutional Services LLC; J.P. Morgan Securities LLC; Keefe, Bruyette & Woods, Inc.; Morgan Stanley & Co. LLC; RBC Capital Markets, LLC; UBS Securities LLC; and Wells Fargo Securities, LLC. This group combines global investment banks and specialized mortgage REIT finance firms, enhancing distribution reach across diverse investor segments and geographies.

The agents earn customary fees and commissions on shares sold, aligning incentives for active distribution. The filing notes these agents and affiliates have provided investment banking and brokerage services to Dynex Capital in the ordinary course and may continue, acknowledging standard industry relationships and potential conflicts managed through disclosure protocols.

Ongoing Amendments Reflect Active Capital Program

Amendment No. 10 follows nine prior amendments dating back to June 29, 2018, with previous changes on May 31, 2019; August 3, 2021; June 3, 2022; February 10, 2023; October 29, 2024; May 1, 2025; July 29, 2025; January 27, 2026; and April 28, 2026. Multiple amendments in 2026 alone indicate active utilization and successive expansions to maintain share authorization levels.

This amendment pattern highlights Dynex Capital’s reliance on the at-the-market offering as a primary equity financing tool, allowing nimble adjustments without shareholder votes. The filing does not provide guidance on future authorization increases or specific uses for newly authorized shares, leaving decisions to management based on capital needs and market conditions.

Legal and Tax Opinions Support Offering Compliance

For Amendment No. 10, Dynex Capital obtained legal opinions from Morrison & Foerster LLP regarding the legality of the common stock issuance and U.S. federal income tax implications. The legality opinion (Exhibit 5.1) confirms shares are duly authorized and, upon issuance, will be validly issued, fully paid, and non-assessable.

The tax opinion (Exhibit 8.1) addresses federal income tax matters relevant to shareholders and the company, including REIT qualification under Internal Revenue Code Section 856 and dividend tax treatment. Maintaining tax-qualified REIT status is critical for Dynex Capital’s business model and shareholder value.

At-the-Market Offering Advantages and Investor Considerations

ATM offerings allow incremental share sales at market prices, enabling continuous equity capital access without large block transactions that could depress stock prices. This flexibility benefits REITs like Dynex Capital by aligning issuance timing with favorable market conditions and investor demand.

Investors should consider that continuous share issuance can lead to steady dilution over time, though typically less abrupt than traditional secondary offerings. Conversely, the company avoids announcing large offerings that may temporarily pressure stock prices. The filing does not disclose Dynex Capital’s historical ATM utilization rates or future issuance timing.

Implications for Shareholders and Potential Investors

The 80 million share increase under Amendment No. 10 implies potential dilution for current shareholders, with 99.3 million shares available representing a substantial portion relative to typical mortgage REIT trading volumes and capitalization. Measured deployment aligned with capital needs could offset dilution through accretive use of proceeds, while aggressive issuance might pressure per-share metrics such as earnings, book value, and dividend coverage.

For dividend-focused investors, the expanded ATM capacity signals management’s anticipation of ongoing capital requirements to support distributions, acquisitions, or portfolio adjustments. REITs must distribute at least 90% of taxable income and rely on operational cash flow plus capital raises. The filing does not specify proceeds’ intended use, leaving investors to infer based on historical strategies.

Regulatory Classification and Exchange Listing Status

Dynex Capital confirmed it is not an emerging growth company under Securities Act Rule 405 and Exchange Act Rule 12b-2, indicating it exceeds size thresholds for scaled disclosure accommodations. This status subjects the company to full disclosure and compliance standards.

Listed on the New York Stock Exchange for both common and Series C preferred stock, Dynex Capital meets governance, disclosure, and financial criteria consistent with mature REIT issuers. The July 28, 2026 filing was signed by Michael A. Angelo, Chief Legal Officer and Corporate Secretary, confirming proper authorization.