Exhibit 10.1

 

AMENDMENT TO THE MANAGEMENT AGREEMENT

 

THIS AMENDMENT TO THE MANAGEMENT AGREEMENT (this “Amendment”), is made this 3rd
day of August 2016, by and between Western Asset Mortgage Capital Corporation, a
Delaware corporation (the “Company”), and Western Asset Management Company, a
California corporation (the ‘‘Manager”), on the terms and conditions set forth
below.

 

WITNESSETH:

 

WHEREAS, the Company and the Manager are parties to that certain Management
Agreement, dated as of May 9, 2012 (the “Management Agreement”), pursuant to
which the Company retained the Manager to administer the business activities and
day-to-day operations of the Company and to perform services for the Company in
the manner and on the terms set forth therein; and

 

WHEREAS, the Company and the Manager desire to amend Management Agreement as set
forth herein.

 

NOW, THEREFORE, in consideration of the premises and agreements hereinafter set
forth, the parties hereto hereby agree as follows:

 

Section 1.              Definitions.  The definition of “Equity” set forth in
Section 1(a) of the Management Agreement is hereby amended and restated, in its
entirety, as follows:

 

“‘Equity’ means (a) the sum of (1) the net proceeds from any issuances of the
Company’s equity securities since inception (allocated on a pro rata basis for
such issuances during the fiscal quarter of any such issuance), plus (2) the
Company’s retained earnings calculated in accordance with GAAP at the end of the
most recently completed fiscal quarter (without taking into account any non-cash
equity compensation expense incurred in current or prior periods), less (b) any
amount that the Company has paid to repurchase Common Stock since inception. 
Equity excludes (1) any unrealized gains, losses or other non-cash items that
have impacted stockholders’ equity as reported in the Company’s financial
statements prepared in accordance with GAAP, regardless of whether such items
are included in other comprehensive income or loss, or in net income, and
(2) one-time events pursuant to changes in GAAP, and certain non-cash items not
otherwise described above in each case, after discussions between the Manager
and the Independent Directors and approval by a majority of the Independent
Directors.  Notwithstanding the foregoing, for all fiscal quarters beginning on
and following January 1, 2016, Equity shall be reduced by the amount of any
other-than-temporary-impairment recognized by the Company during such fiscal
quarter.”

 

Section 2.              Miscellaneous.

 

(a)           Limited Effect of Amendment.  All other terms and provisions of
the Management Agreement shall remain in full force and effect, except as
modified hereby.

 

(b)           Counterparts.  This Amendment may be executed by the parties to
this Amendment on any number of separate counterparts (including by telecopy),
and all of said counterparts taken together shall be deemed to constitute one
and the same instrument.

 

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IN WITNESS WHEREOF, each of the parties hereto has executed this Amendment on
the day and year first above written.

 

 

 

Western Asset Mortgage Capital Corporation

 

 

 

 

 

By:

/s/ Lisa Meyer

 

Name: Lisa Meyer

 

Title: Chief Financial Officer and Treasurer

 

 

 

 

 

Western Asset Management Company

 

 

 

 

 

By:

/s/ Charles A. Ruys de Perez

 

Name: Charles A. Ruys de Perez

 

Title: General Counsel and Secretary

 

[Signature Page to Amendment to the Management Agreement]

 

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