Exhibit 10.3

July 1, 2016
PERSONAL AND CONFIDENTIAL
Christopher Kuehl
American Capital Mortgage Management, LLC
Two Bethesda Metro Center, 14th Floor
Bethesda, MD 20814

Dear Christopher:
In connection with the transactions contemplated by the Purchase and Sale
Agreement, dated as of May 23, 2016, by and among American Capital Asset
Management, LLC, American Capital Mortgage Management, LLC (the “Company”),
American Capital, Ltd. (“ACAS”) and American Capital Agency Corp. (“AGNC”) (such
agreement, the “Purchase Agreement”), you and the Company hereby agree to the
following changes to the Employment Agreement, entered into as of March 30,
2012, by and between the Company and you (the “Employment Agreement”).

1.Notwithstanding anything contained in your Employment Agreement to the
contrary, as of the date hereof, your titles shall be Senior Vice President,
Agency Portfolio Investments of AGNC, Senior Vice President, Agency Portfolio
Investments of American Capital Mortgage Investment Corp. (“MTGE”) and Senior
Vice President of the Company, and you shall report to the Chief Executive
Officer, President and Chief Investment Officer of AGNC.

2.Each reference to the “Board of Managers” in your Employment Agreement shall
be deemed to be a reference to the “Board of Directors of American Capital
Agency Corp. or its designee”.

3.Each reference to “American Capital, Ltd.” or “ACAS” in your Employment
Agreement shall be deemed to be a reference to “American Capital Agency Corp.”

4.With respect to any award that the Company is obligated to provide to you
(whether by your Employment Agreement or otherwise) pursuant to the American
Capital Mortgage Management, LLC Performance Incentive Plan – AGNC, the American
Capital Mortgage Management, LLC Performance Incentive Plan – MTGE or any other
similar plan (whether payable in shares of stock of ACAS, AGNC, MTGE or
otherwise), the Company may (in the discretion of the Board of Directors of AGNC
or its designee), in lieu thereof, provide (a) a substitute cash award, which
shall be granted solely pursuant to the terms and conditions of a comparable
cash incentive plan, or (b) a substitute equity award, which shall be granted
solely pursuant to the terms and conditions of an equity incentive plan (but
only if such a plan has received all required corporate approvals, including, if
required, approval by the stockholders of AGNC). Any such substitute cash award
or substitute equity award shall (i) have the same cash value as the
corresponding replaced award, (ii) have the same or

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shorter vesting schedule as the corresponding replaced award, and (iii) provide
for the accrual and payment of dividends (or a cash award of like value) in a
manner comparable to the accrual and payment of dividends under the
corresponding replaced award.

5.You acknowledge and agree that the consummation of the transactions
contemplated by the Purchase Agreement shall not constitute grounds for you to
terminate your employment for “Good Reason.”

Very truly yours,
AMERICAN CAPITAL MORTGAGE MANAGEMENT, LLC

By: _____/s/ Gary Kain________________
Name: Gary Kain
Title: Chief Executive Officer and
President
Accepted and Agreed:

By: /s/ Christopher Kuehl    
Christopher Kuehl

    

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EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT (this “Agreement”) is entered into as of March 30,
2012 (the “Effective Date”), by and between AMERICAN CAPITAL MORTGAGE
MANAGEMENT, LLC (formerly known as American Capital Agency Management, LLC), a
Delaware limited liability company (the “Company”), and CHRISTOPHER J. KUEHL
(the “Executive”).
W I T N E S S E T H:
WHEREAS, the Company is currently engaged through its subsidiaries in the
business of, among other things, managing mortgage real estate investment trusts
(“REITs”), which invest in (a) agency securities for which the principal and
interest payments are guaranteed by U.S. Government agencies and U.S.
Government-sponsored entities, (b) non-agency securities, and/or (c) other
mortgage related investments; and
WHEREAS, the Executive is Senior Vice President of Mortgage Investments of the
Company, and in such role, the Executive has received and will continue to
receive specific trade secrets and confidential information, training and the
benefit of established customer relationships relating to the businesses of the
Company, which trade secrets and confidential information, training and access
to established customer relationships are necessary to enable the Executive to
perform the Executive’s duties and to receive future compensation, and the
Executive has played and will continue to play a significant role in the
development and management of the businesses of the Company; and
WHEREAS, it is in the interests of the Company that the Executive’s services
continue to be available to the Company; and
WHEREAS, the Company and the Executive wish to enter into this Agreement to
govern the terms and conditions of the Executive’s employment with the Company
on and after the Effective Date; and
WHEREAS, it is a condition to the Executive’s continued employment by the
Company that the Executive execute and deliver this Agreement, and in order to
induce the Executive to continue his employment, the Company has agreed to
provide him with the rights and benefits described more fully herein.
NOW, THEREFORE, in consideration of the mutual covenants, representations,
warranties and agreements contained herein, and for other valuable
consideration, the receipt and adequacy of which are hereby acknowledged, the
parties hereto agree as follows:
ARTICLE 1
DEFINITIONS AND INTERPRETATIONS
1.1
Definitions

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For purposes of this Agreement, except as otherwise expressly provided or unless
the context otherwise requires, the following terms shall have the following
respective meanings:
“ACAS” shall mean American Capital, Ltd., a Delaware corporation.
“AGNC” shall mean American Capital Agency Corp., and its successors and assigns.
“Base Salary” shall have the meaning specified in Section 3.1.
“Board of Managers” shall mean the Board of Managers of the Company.
“Change of Control” shall mean the occurrence of any of the following events:
(i) any person or group of persons (as defined in Section 13(d) and 14(d) of the
Exchange Act) together with its affiliates, excluding employee benefit plans of
the Company, becomes, directly or indirectly, the “beneficial owner” (as defined
in Rule 13d-3 under the Exchange Act) of securities of the Company representing
50% or more of the combined voting power of the Company’s then outstanding
securities; (ii) the stockholders of the Company approve a merger or
consolidation of the Company with any other corporation or entity regardless of
which entity is the survivor, other than a merger or consolidation that would
result in the voting securities of the Company outstanding immediately prior
thereto continuing to represent (either by remaining outstanding or being
converted into voting securities of the surviving entity) at least 51% of the
combined voting power of the voting securities of the Company or such surviving
entity outstanding immediately after such merger or consolidation; or (iii) the
stockholders of the Company approve a plan of complete liquidation or winding-up
of the Company or an agreement for the sale or disposition by the Company of all
or substantially all of the Company’s assets.
“Code” shall mean the Internal Revenue Code of 1986, as amended.
“Company Managed Fund” shall mean any entity for which the Company or a
subsidiary of the Company serves as investment manager or in a substantially
similar capacity pursuant to a written agreement. For avoidance of doubt, as of
the Effective Date, the Company Managed Funds are AGNC and MTGE.
“Confidential Information” shall have the meaning specified in Section 5.1(a).
“Disability” shall mean a physical or mental condition of the Executive that, in
the good faith judgment of not less than a majority of the Board of Managers,
prevents the Executive from being able to perform the services required under
this Agreement and that results in the Executive becoming eligible for long-term
disability benefits (if such benefits are provided by the Company). If any
dispute arises as to whether a Disability has occurred, or whether a Disability
has ceased and the Executive is able to resume duties, then such dispute shall
be referred to a licensed physician appointed by the president of the Medical
Society or similar organization in Washington, D.C., at the request of either
party. The Executive shall submit to such examinations and provide information
as such physician may request and the determination of such physician as to the
Executive’s physical or mental condition shall be binding and

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conclusive on the parties. The Company shall pay the cost of any such physician
and examination.
“Dispute” shall have the meaning specified in Article VI.
“Exchange Act” shall mean the Securities Exchange Act of 1934, as amended.
“Expiration Date” shall have the meaning specified in Section 2.2.
“Good Reason” shall mean any of the following, which occur within the two months
preceding or the 18 months following a Change of Control and without the
Executive’s express written consent:
(i)    a material diminution of the Executive’s authority, duties or
responsibilities with the Company;
(ii)    a material breach by the Company of any material provision of this
Agreement; or
(iii)    any material change in the geographic location at which the Executive
must perform services (in this case, a material change means any location
outside of the Washington, D.C. metropolitan area).
The Executive must provide written notice to the Company within 90 days of the
initial existence of a condition set forth in clauses (i) - (iii) and the
Company shall have 30 days after receipt of any such notice to remedy the
condition. If the Company timely remedies such condition, such condition shall
not constitute Good Reason. The Executive may not terminate the Executive’s
employment hereunder for Good Reason more than six months after the initial
existence of one (or more) of the conditions set forth in clauses (i) - (iii)
which constitutes Good Reason.
“Misconduct” shall mean one or more of the following:
(i)    the willful and continued failure by the Executive to perform
substantially the Executive’s duties described in Section 2.3 (other than any
such failure resulting from the Executive’s incapacity due to physical or mental
illness) after two (2) written notices of such failure have been given to the
Executive by the Company and the Executive has had a reasonable period (not to
exceed 15 days from the second notice) to correct such failure;
(ii)    the commission by the Executive of acts that are dishonest and
demonstrably injurious to the Company or any Company Managed Fund (monetarily or
otherwise) in any material respect; or
(iii)    a material breach or violation by the Executive of (a) any material
provision of this Agreement or (b) any material Company employment policy,
including its Code of Ethics, that the Company may publish from time to time,
which, if capable of being remedied, remains unremedied for more than 15 days
after written notice thereof is given to the Executive by the Company.

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For purposes of this definition, no act or failure to act on the Executive’s
part shall be considered “Misconduct” if done or omitted to be done by the
Executive in good faith and in the reasonable belief that such act or failure to
act was in the best interest of the Company or in furtherance of the Executive’s
duties and responsibilities described in Section 2.3.
“MTGE” shall mean American Capital Mortgage Investment Corp., and its successors
and assigns.
“Notice of Termination” shall mean a notice purporting to terminate the
Executive’s employment in accordance with Section 4.1, 4.2 or 4.3. Such notice
shall specify the effective date of such termination, which date shall not be
less than 30 days (one (1) day in the case of a termination by the Company for
Misconduct) or more than 60 days after the date such notice is given. If such
termination is by the Company for Disability or Misconduct or by the Executive
for Good Reason, such notice shall set forth in reasonable detail the reason for
such termination and the facts and circumstances claimed to provide a basis
therefor.
“Person” shall mean and include an individual, a partnership, a joint venture, a
corporation, a trust and an unincorporated organization.
“Target Incentive Payment Plan” shall have the meaning specified in Section 3.2.
“Term” shall have the meaning specified in Section 2.2.
“Termination Date” shall mean the effective date of the Executive’s termination
of employment and shall be the date specified in a Notice of Termination
delivered in accordance with this Agreement. If earlier, the date of the
Executive’s death shall be the Termination Date.
1.2
Interpretations

(a)    In this Agreement, unless a clear contrary intention appears, (i) the
words “herein,” “hereof” and “hereunder” and other words of similar import refer
to this Agreement as a whole and not to any particular Article, Section or other
subdivision, (ii) reference to any Article or Section, means such Article or
Section hereof, (iii) the words “including” (and with correlative meaning
“include”) means including, without limiting the generality of any description
preceding such term, and (iv) where any provision of this Agreement refers to
action to be taken by either party, or which such party is prohibited from
taking, such provision shall be applicable whether such action is taken directly
or indirectly by such party.
(b)    The Article and Section headings herein are for convenience only and
shall not affect the construction hereof.
(c)    References herein to a termination of employment shall be interpreted to
mean a “separation from service” within the meaning of Section 409A of the Code.

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ARTICLE 2
EMPLOYMENT: TERM, POSITIONS AND DUTIES, ETC.
2.1
Employment

The Company agrees to employ the Executive and the Executive agrees to accept
employment with the Company, in each case on the terms and conditions set forth
in this Agreement.
2.2
Term of Employment

Unless sooner terminated pursuant to Article IV, the term of the Executive’s
employment under this Agreement (the “Term”) shall commence on the Effective
Date and shall continue until the second anniversary of the Effective Date (the
“Expiration Date”); provided, however, that on each date during the Term, the
Expiration Date shall be reset to the date two years after the date thereof,
except that either party may terminate this Agreement by giving written notice
that such daily extensions of the Term shall be discontinued in which case the
Expiration Date shall be the date two years after the delivery of such notice.
2.3
Positions and Duties

(a)    While employed hereunder, the Executive shall serve as Senior Vice
President of Mortgage Investments of the Company. As such, the Executive shall
have the responsibilities and authorities designated to him by the President and
Chief Investment Officer of the Company (the “President”) or the Board of
Managers.
(b)    While employed hereunder, the Executive shall (i) report directly to the
President or such other person designated by the Board of Managers, and
(ii) observe and comply with all lawful policies, directions and instructions of
the President or other person so designated that are consistent with the
foregoing provisions of this Section 2.3.
(c)    While employed hereunder, the Executive shall (i) devote substantially
all of the Executive’s business time, attention, skill and efforts to the
faithful and efficient performance of the Executive’s duties hereunder and
(ii) not accept employment with any Person other than with the Company.
Notwithstanding the foregoing, the Executive may engage in the following
activities so long as they do not interfere in any material respect with the
performance of the Executive’s duties and responsibilities hereunder: (i) serve
on corporate, civic, religious, educational or charitable boards or committees
and (ii) manage the Executive’s personal investments.
(d)    While employed hereunder, the Executive shall not knowingly prejudice, in
any material respect, the reputation of the Company or the Company Managed Funds
in the fields of business in which they are engaged or with the investment
community or the public at large.

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ARTICLE 3
COMPENSATION AND BENEFITS
3.1
Base Salary

(a)    For services rendered by the Executive under this Agreement, the Company
shall pay to the Executive an annual base salary (“Base Salary”) of $900,000,
evenly paid twice a month or on such other schedule as salaried employees of the
Company are generally and regularly compensated. Subject to paragraph (b) below,
the Board of Managers may adjust the amount of the Base Salary at any time as it
may deem appropriate in its sole discretion.
(b)    The amount of the Base Salary may not be decreased without the prior
written approval of the Executive except that if the Board of Managers increases
the Base Salary as provided in the last sentence of paragraph (a) above, the
Board of Managers may thereafter decrease the Base Salary, provided that in no
event shall any such decrease cause the Executive’s Base Salary to fall below
$900,000.
3.2
Target Incentive Payment Plan

During the Term, the Company shall maintain and the Executive shall be entitled
to participate in an annual incentive payment plan described in greater detail
in Exhibit A hereto (the “Target Incentive Payment Plan”), which will provide
for the payment of lump sum cash incentive payments to be made on the schedule
set forth in Exhibit A. Under the Target Incentive Payment Plan, the Executive
will be eligible to earn target incentive payments (each, a “Target Incentive
Payment”) each year totaling not less than 200% of the Base Salary paid to the
Executive during the calendar year to which the Target Incentive Payment relates
(the “Target Incentive Payment Amount”). With regard to each calendar quarter,
the Executive will be eligible to earn a Target Incentive Payment of not less
than 100% of the Base Salary paid to the Executive during such calendar quarter
(the “Quarterly Target Incentive Payment Amount”).
3.3
Performance Incentive Plan Awards

(a)    Upon execution of this Agreement, the Executive will be granted an award
or awards under the American Capital Mortgage Management, LLC Performance
Incentive Plan – AGNC (the “AGNC PIP”) valued at $900,000 in the aggregate (the
“AGNC PIP Awards”). The AGNC PIP Awards will generally vest annually and equally
over five years from the date of grant, subject to the Executive’s continued
employment with the Company; provided that such AGNC PIP Awards shall provide
for continued vesting of unvested award tranches after the Executive’s
termination of employment by the Company without Cause or by the Executive with
Good Reason on the earlier of the originally scheduled vesting date for such
award tranche or the eighteen (18) month anniversary of the Termination Date,
subject to the Executive’s continued compliance with his obligations under
Article V of this Agreement. Each vesting tranche of the AGNC PIP Awards shall
be considered a separate payment for purposes of Section 409A of the Code. The
AGNC PIP Awards will also be subject to the terms and conditions of the AGNC PIP
and any associated award documentation. At the Board of Manager’s sole
discretion, up to 25%

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of the initial value of the AGNC PIP Awards shall be notionally invested in
shares of common stock of ACAS.
(b)    Upon execution of this Agreement, the Executive will be granted an award
or awards under the American Capital Mortgage Management, LLC Performance
Incentive Plan – MTGE (the “MTGE PIP”) valued at $100,000 in the aggregate (the
“MTGE PIP Awards”). The MTGE PIP Awards will generally vest annually and equally
over five years from the date of grant, subject to the Executive’s continued
employment with the Company; provided that such MTGE PIP Awards shall provide
for continued vesting of unvested award tranches after the Executive’s
termination of employment by the Company without Cause or by the Executive with
Good Reason on the earlier of the originally scheduled vesting date for such
award tranche or the eighteen (18) month anniversary of the Termination Date,
subject to the Executive’s continued compliance with his obligations under
Article V of this Agreement. Each vesting tranche of the MTGE PIP Awards shall
be considered a separate payment for purposes of Section 409A of the Code. The
MTGE PIP Awards will also be subject to the terms and conditions of the MTGE PIP
and any associated award documentation. At the Board of Manager’s sole
discretion, up to 25% of the initial value of the MTGE PIP Awards shall be
notionally invested in shares of common stock of ACAS.
(c)    The Executive will also be granted, subject to his continued employment
on the date of grant, future awards under the AGNC PIP and MTGE PIP and any
similar plans maintained by the Company relating to any other Company Managed
Funds. The annual value of such awards would equal .03% of the prior year-end
combined equity value of the Company Managed Funds up to $10 billion, .02% of
the prior year-end combined equity value of the Company Managed Funds between
$10 billion and $15 billion, and .01% of the prior year-end combined equity
value of the Company Managed Funds above $15 billion. The amount granted under
each of the AGNC PIP and MTGE PIP and any similar plans maintained by the
Company relating to any other Company Managed Funds will be proportional to the
year-end equity value of each such Company Managed Fund. Any such future awards
will be subject to the terms and conditions of the AGNC PIP, MTGE PIP and any
such similar plans and forms of agreement attached hereto as Exhibits
3.3(c)-AGNC and 3.3(c)-MTGE or similar forms of agreement under any such similar
plans. At the Board of Manager’s sole discretion, up to 25% of the initial value
of any such future awards shall be notionally invested in shares of common stock
of ACAS.
3.4
Vacation

While employed hereunder, the Executive shall be entitled to vacation benefits
in accordance with the vacation policy adopted by the Company from time to time.
3.5
Other Benefits

The Executive shall be entitled to receive all employee benefits, fringe
benefits and other perquisites that may be offered by the Company to its
employees as a group, including, without limitation, participation by the
Executive and, where applicable, the Executive’s dependents, in the various
employee benefit plans or programs (including, without limitation, pension
plans, profit sharing plans, stock plans, health plans, life insurance, parking
and disability insurance)

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generally provided to employees of the Company, subject to meeting the
eligibility requirements with respect to each of such benefit plans or programs.
However, nothing in this Section 3.5 shall be deemed to prohibit the Company
from making any changes in any of the plans, programs or benefits described
herein, provided such changes apply to all similarly situated employees.
ARTICLE 4
TERMINATION OF EMPLOYMENT
4.1
Termination by the Executive

The Executive may, at any time prior to the Expiration Date, terminate the
Executive’s employment hereunder for any reason by delivering a Notice of
Termination to the Board of Managers. Unless such termination is for Good
Reason, upon such termination, the Executive shall be entitled only to those
rights and payments payable under Section 4.4.
4.2
Termination by the Company

The Board of Managers may, at any time prior to the Expiration Date, terminate
the Executive’s employment hereunder for any reason by delivering a Notice of
Termination to the Executive.
4.3
Termination Due to Disability or Death

The Board of Managers may terminate the Executive’s employment by reason of
Disability by delivering a Notice of Termination to the Executive, and
Executive’s employment will automatically terminate in the event of his death.
4.4
Payment of Accrued Base Salary, Vacation Pay, etc.

(a)    Promptly upon the Executive’s Termination Date in the event of the
termination of the Executive’s employment for any reason (including death and
Disability), and in no event later than 60 days following the Executive’s
Termination Date, as applicable, the Company shall pay to the Executive (or the
Executive’s estate) a lump sum amount equal to the sum of all (i) unpaid Base
Salary earned hereunder prior to the Termination Date and (ii) unused vacation
time accrued by the Executive as of the Termination Date to the extent payable
under the policy described in Section 3.4. All unpaid benefits earned or vested,
as the case may be, by the Executive as of the Termination Date under any and
all incentive or deferred compensation plans or programs of the Company shall be
paid to the Executive in accordance with the terms of such plans or programs.
(b)    A termination of the Executive’s employment in accordance with this
Agreement shall not alter or impair any of the Executive’s accrued rights or
benefits as of the Termination Date under any employee benefit plan or program
maintained by the Company, in each case except as provided therein or in any
written agreement entered into between the Company and the Executive pursuant
thereto.

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4.5
Additional Rights in Connection With Termination by the Executive with Good
Reason or by the Company for Other than Misconduct or Disability

In the event that the Executive terminates the Executive’s employment with the
Company pursuant to Section 4.1 for Good Reason or the Company terminates the
Executive’s employment with the Company pursuant to Section 4.2 for other than
Misconduct or Disability, the Executive shall be entitled to the payments and
benefits set forth in this Section 4.5.
(a)    Severance Payments and Target Incentive Payment.
(i)    The Company shall pay to the Executive an amount equal to eighteen (18)
months of Base Salary in eighteen (18) substantially equal monthly installment
payments beginning with the first calendar month that begins at least 60 days
after the Termination Date. Each monthly installment shall be treated as a
separate payment for purposes of Section 409A of the Code.
(ii)    The Executive shall be entitled to a pro rata portion of the Executive’s
Target Incentive Payment, if any, for the calendar year in which the Termination
Date occurs, payable at the normal payment time as if the Executive’s employment
had not terminated, but in no event later than March 15 of the calendar year
following the calendar year in which the Termination Date occurs.
(iii)    The Executive shall be entitled to receive an additional severance
payment in an amount equal to the product of (A) 1.5, and (B) his Target
Incentive Payment Amount. This additional severance payment shall be paid in a
single lump sum between January 1 and March 15 of the year following the
calendar year in which the Termination Date occurs.
(b)    Accelerated Vesting of Prior PIP Awards. To the extent any awards under
the AGNC PIP and/or the MTGE PIP granted prior to the date hereof are unvested,
such awards shall immediately be vested as of the Termination Date, and
distributions in respect of such awards shall be made as soon as practicable
(and in all event within 60 days) after the Termination Date.
(c)    Pro Rata PIP Awards. On or as soon as practicable (and in all event
within 60 days) after the Termination Date, the Executive will be granted awards
under the AGNC PIP, MTGE PIP and any similar plans maintained by the Company
relating to any other Company Managed Funds equal in the aggregate to .03% of
the prior year-end combined equity value of the Company Managed Funds up to $10
billion, .02% of the prior year-end combined equity value of the Company Managed
Funds between $10 billion and $15 billion, and .01% of the prior year-end
combined equity value of the Company Managed Funds above $15 billion, pro rated
to reflect the number of days in the calendar year in which the Termination Date
occurs during which the Executive was employed by the Company; provided that
such pro rated amount shall be reduced by the value of any awards made under the
AGNC PIP, MTGE PIP and any such similar plans calculated by reference to such
prior year combined equity value of the Company Managed Funds (the “Termination
PIP Awards”). The amount of Termination PIP Awards granted under each of the
AGNC PIP, MTGE PIP and any such similar plans will (after taking into account
any other awards calculated by reference to such prior year combined equity
value)

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be proportional to the year-end equity value of each such Company Managed Fund.
Subject to the Executive’s continued compliance with his obligations under
Article V of this Agreement, twenty percent (20%) of the Termination PIP Awards
will vest and be paid out on the one-year anniversary of the Termination Date,
and the remainder will vest and be paid out on the eighteen (18) month
anniversary of the Termination Date. Any Termination PIP Awards will be subject
to the terms and conditions of the AGNC PIP and MTGE PIP and forms of agreement
attached hereto as Exhibits 4.5(c)-AGNC and 4.5(c)-MTGE or similar forms of
agreement under any similar plans maintained by the Company relating to any
other Company Managed Funds. At the Board of Manager’s sole discretion, up to
25% of the initial value of any such Termination PIP Awards shall be notionally
invested in shares of common stock of ACAS.
(d)    Release. Notwithstanding anything in this Section 4.5 to the contrary, as
a condition to the receipt of any payment or benefit under this Section 4.5, the
Executive must first execute and deliver to the Company, within 45 days
following the Executive’s Termination Date, an effective release in the form set
out in Exhibit 4.5(d) hereto, that becomes irrevocable prior to the 60th day
following the Executive’s Termination Date, releasing the Company and Company
Managed Funds, and their officers, board members, employees and agents from any
and all claims and from any and all causes of action of any kind or character
that the Executive may have arising out of the Executive’s employment with the
Company or the termination of such employment, but excluding any claims and
causes of action that the Executive may have arising under or based upon this
Agreement.
4.6
Specified Employees

Notwithstanding anything to the contrary herein, if a payment or benefit under
this Agreement is due to a “separation from service” for purposes of the rules
under Treas. Reg. § 1.409A-3(i)(2) (payments to specified employees upon a
separation from service) and the Executive is determined to be a “specified
employee” (as determined under Treas. Reg. § 1.409A-1(i) and the related Company
procedures), such payment shall, to the extent necessary to comply with the
requirements of Section 409A of the Code, be made on the later of the date
specified by the foregoing provisions of this Agreement or the date that is six
months after the date of the Executive’s separation from service. Any
installment payments that are delayed pursuant to this Section 4.6 shall be
accumulated and paid in a lump sum on the first day of the seventh month
following the date of the Executive’s Termination Date, and the remaining
installment payments shall begin on such date in accordance with the schedule
provided in this Agreement.
ARTICLE 5
CONFIDENTIAL INFORMATION, NON-COMPETITION AND INTELLECTUAL PROPERTY
5.1
Confidential Information

(a)    The Executive recognizes that the services to be performed by the
Executive hereunder are special, unique and extraordinary and that, by reason of
such employment with the Company, the Executive has acquired and will continue
to acquire Confidential Information

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concerning the operation of the Company, the use or disclosure of which would
cause the Company substantial loss and damages which could not be readily
calculated and for which no remedy at law would be adequate. Accordingly, the
Executive agrees that the Executive will not (directly or indirectly) at any
time, whether during or after the Executive’s employment hereunder,
(i) knowingly use for an improper personal benefit any Confidential Information
that the Executive may learn or has learned by reason of the Executive’s
employment with the Company or (ii) disclose any such Confidential Information
to any Person except (A) in the performance of the Executive’s obligations to
the Company hereunder, (B) as required by applicable law or (C) with the prior
written consent of the Board of Managers. As used herein, “Confidential
Information” includes information with respect to the operation and performance
of the Company, ACAS and the Company Managed Funds, their investments, portfolio
companies, products, services, facilities, product methods, research and
development, trade secrets and other intellectual property, systems, patents and
patent applications, procedures, manuals, confidential reports, product price
lists, customer lists, financial information, business plans, prospects or
opportunities (including, as applicable, all of the foregoing information
regarding the Company’s, ACAS’s and/or the Company Managed Funds’ past, current
and prospective portfolio companies); provided, however, that such term shall
not include any information that (x) is or becomes generally known or available
other than as a result of a disclosure by the Executive or (y) is or becomes
known or available to the Executive on a nonconfidential basis from a source
(other than the Company) that, to the Executive’s knowledge, is not prohibited
from disclosing such information to the Executive by a legal, contractual,
fiduciary or other obligation to the Company.
(d)    The Executive confirms that all Confidential Information is the exclusive
property of the Company. All business records, papers and documents kept or made
by the Executive while employed by the Company relating to the business of the
Company shall be and remain the property of the Company at all times. Upon the
request of the Company at any time, the Executive shall promptly deliver to the
Company, and shall retain no copies of, any written materials, records and
documents made by the Executive or coming into the Executive’s possession while
employed by the Company concerning the business or affairs of the Company other
than personal materials, records and documents (including notes and
correspondence) of the Executive not containing proprietary information relating
to such business or affairs. Notwithstanding the foregoing, the Executive shall
be permitted to retain copies of, or have access to, all such materials, records
and documents relating to any disagreement, dispute or litigation (pending or
threatened) between the Executive and the Company.
5.2
Non-Competition; Non-Solicitation.

(a)    The Executive agrees that during the term of his employment with the
Company and for a period of eighteen (18) months beginning on the date of
termination of his employment for any reason (the “Non-Competition Period”), the
Executive shall not, directly or indirectly, engage or participate in, prepare
or set up, assist or have any interest in any person, partnership, corporation,
firm, association, or other business organization, entity or enterprise, whether
as an officer, employee, director, partner, stockholder, consultant or
otherwise, that would be the same or competitive with any business activity
engaged in by the Company or any Company Managed

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Fund (a “Restricted Business”). Notwithstanding the foregoing, the Executive
shall not be precluded from purchasing or owning, directly or beneficially, as a
passive investment, two percent (2%) or less of any class of publicly traded
securities if he does not actively participate in or control, directly or
indirectly, any investment or other decisions with respect to such entity.
(b)     During the Non-Competition Period, the Executive shall not, directly or
indirectly:
(i)hire, offer to hire, divert, entice away, solicit or in any other manner
persuade, or attempt to do any of the foregoing (each, a “Solicitation”), any
person who is an officer, employee, consultant or board member of the Company or
any Company Managed Fund to accept employment or an engagement with a third
party or engage in a Solicitation with respect to any person or entity who is,
or was, at any time within six months prior to the Solicitation, an officer,
employee, agent or consultant of the Company or any Company Managed Fund to work
for a third party engaged in a Restricted Business or to engage in any of the
activities hereby prohibited with respect to the Executive under Sections
5.2(b)(ii) or (iii) below; or
(ii)    solicit, divert, entice away or in any other manner persuade, or attempt
to do any of the foregoing, on (A) any actual or prospective customer of or
investor in the Company or any Company Managed Fund to become a customer of or
investor in any third party engaged in a Restricted Business or (B) any customer
or investor to cease doing business with the Company or any Company Managed
Fund; or
(iii)    make any statements or perform any acts intended to advance the
interest of any person engaged in or proposing to engage in a Restricted
Business in any way that is intended to injure the interests of the Company or
any Company Managed Fund.
5.3
Intellectual Property.

The Executive agrees that during the term of the Executive’s employment with the
Company, any and all inventions, discoveries, innovations, writings, domain
names, improvements, trade secrets, designs, drawings, business processes,
secret processes and know-how, whether or not patentable or a copyright or
trademark, which the Executive may create, conceive, develop or make, either
alone or in conjunction with others and related or in any way connected with the
Company, its strategic plans, products, processes, apparatus or business now or
hereafter carried on by the Company (collectively, “Inventions”), shall be fully
and promptly disclosed to the Company and shall be the sole and exclusive
property of the Company (as it shall determine) as against the Executive or any
of the Executive’s assignees. Regardless of the status of the Executive’s
employment by the Company, the Executive and the Executive’s heirs, assigns and
representatives hereby assigns, or shall promptly assign, to the Company any and
all right, title and interest in and to such Inventions made during the term of
the Executive’s employment by the Company. Except as set forth on Schedule 1 to
this Agreement, there are no Inventions with respect to the Company conceived
of, developed or made by the Executive before the date of this Agreement which
have not been disclosed to and assigned to the Company.

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5.4
Early Resolution Conference.

This Agreement is understood to be clear and is intended to be enforceable as
written and is executed by both parties on that basis. However, should the
Executive determine to later challenge any provision as unclear, unenforceable
or inapplicable to an activity that the Executive intends to engage in, the
Executive will first notify the Company in writing and meet with a
representative of the Company and a neutral mediator (if the Company elects to
retain one at its expense) to discuss resolution of any dispute between the
parties with respect to such challenge. The Executive will provide this
notification at least fourteen (14) days before Executive the engages in any
activity on behalf of a Restricted Business or engages in other activity that
could foreseeably fall within a questioned restriction. The failure to comply
with this requirement shall waive the Executive’s right to challenge the
reasonable scope, clarity, applicability or enforceability of this Agreement and
its restrictions at a later time. All rights of the parties will be preserved if
the early resolution conference requirement is complied with even if no
agreement is reached in the conference.
5.5
Remedies

(a)    The Executive acknowledges that a breach of any of the covenants
contained in this Article V may result in material irreparable injury to the
Company for which there is no adequate remedy at law, that it will not be
possible to measure damages for such injuries precisely and that, in the event
of such a breach, any payments or benefits remaining under the terms of this
Agreement shall cease and the Company shall be entitled to obtain a temporary
restraining order or a preliminary or permanent injunction from any court
restraining the Executive from engaging in activities prohibited by this Article
V or such other relief as may be required to specifically enforce any of the
covenants contained in this Article V. The Executive agrees to and hereby does
submit to in personam jurisdiction before each and every such court for that
purpose.
(b)    The period of time during which the restrictions set forth in Article V
hereof will be in effect will be extended by the length of time during which the
Executive is in breach of the terms of those provisions as determined by any
court of competent jurisdiction on the Company’s application for injunctive
relief.
ARTICLE 6
DISPUTE RESOLUTION
In the event a dispute (other than a dispute arising under Article V of this
Agreement) shall arise between the parties as to whether the provisions of this
Agreement have been complied with (a “Dispute”), the parties agree to resolve
such Dispute in accordance with the following procedure:
(a)    A meeting shall be held promptly between the parties, attended (in the
case of the Company) by one or more individuals with decision-making authority
regarding the Dispute, to attempt in good faith to negotiate a resolution of the
Dispute.

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(b)    If, within 10 days after such meeting, the parties have not succeeded in
negotiating a resolution of the Dispute, the parties agree to submit the Dispute
to mediation in accordance with the Commercial Mediation Rules of the American
Arbitration Association except that Disputes with regard to the existence of a
Disability shall be resolved in accordance with the definition of the term
“Disability” above.
(c)    The parties will jointly appoint a mutually acceptable mediator, seeking
assistance in such regard from the American Arbitration Association if they have
been unable to agree upon such appointment within 10 days following the 10-day
period referred to in clause (b) above.
(d)    Upon appointment of the mediator, the parties agree to participate in
good faith in the mediation and negotiations relating thereto for 15 days.
(e)    If the parties are not successful in resolving the Dispute through
mediation within such 15-day period, the parties agree that the Dispute shall be
settled by arbitration in accordance with the Expedited Procedures of the
Commercial Arbitration Rules of the American Arbitration Association.
(f)    The fees and expenses of the mediator/arbitrators shall be borne solely
by the non-prevailing party or, in the event there is no clear prevailing party,
as the mediator/arbitrators deem appropriate.
(g)    Except as provided above, each party shall pay its own costs and expenses
(including, without limitation, attorneys’ fees) relating to any
mediation/arbitration proceeding conducted under this Article VI.
(h)    All mediation/arbitration conferences and hearings will be held in the
greater Washington, D.C. area.
(i)    In the event there is any disputed question of law involved in any
arbitration proceeding, such as the proper legal interpretation of any provision
of this Agreement, the arbitrators shall make separate and distinct findings of
all facts material to the disputed question of law to be decided and, on the
basis of the facts so found, express their conclusion of the question of law.
The facts so found shall be conclusive and binding on the parties, but any legal
conclusion reached by the arbitrators from such facts may be submitted by either
party to a court of law for final determination by initiation of a civil action
in the manner provided by law. Such action, to be valid, must be commenced
within 20 days after receipt of the arbitrators’ decision. If no such civil
action is commenced within such 20-day period, the legal conclusion reached by
the arbitrators shall be conclusive and binding on the parties. Any such civil
action shall be submitted, heard and determined solely on the basis of the facts
found by the arbitrators. Neither of the parties shall, or shall be entitled to,
submit any additional or different facts for consideration by the court. In the
event any civil action is commenced under this paragraph (i), the party who
prevails or substantially prevails (as determined by the court) in such civil
action shall be entitled to recover from the other party all costs, expenses and
reasonable attorneys’ fees incurred by the prevailing party in connection with
such action and on appeal.

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(j)    Except as limited by paragraph (i) above, the parties agree that judgment
upon the award rendered by the arbitrators may be entered in any court of
competent jurisdiction. In the event legal proceedings are commenced to enforce
the rights awarded in an arbitration proceeding, the party who prevails or
substantially prevails in such legal proceeding shall be entitled to recover
from the other party all costs, expenses and reasonable attorneys’ fees incurred
by the prevailing party in connection with such legal proceeding and on appeal.
(k)    Except as provided above, (i) no legal action may be brought by either
party with respect to any Dispute and (ii) all Disputes shall be determined only
in accordance with the procedures set forth above.
(l)    For avoidance of doubt, no dispute, disagreement or claim relating to any
provision of Article V shall be governed by or subject to any provision of this
Article VI.
ARTICLE 7
MISCELLANEOUS
7.1
No Mitigation or Offset

The provisions of this Agreement are not intended to, nor shall they be
construed to, require that the Executive mitigate the amount of any payment
provided for in this Agreement by seeking or accepting other employment, nor
shall the amount of any payment provided for in this Agreement be reduced by any
compensation earned by the Executive as the result of employment by another
employer or otherwise. Without limitation of the foregoing, the Company’s
obligations to make the payments to the Executive required under this Agreement
and otherwise to perform its obligations hereunder shall not be affected by any
set off, counterclaim, recoupment, defense or other claim, right or action that
the Company may have against the Executive, except that the Company may deduct
from any amount required to be reimbursed to the Company by the Executive under
Article VI the amount of any payment which the Company is then required to make
to the Executive hereunder.
7.2
Indemnification

No provision of the Company’s Certificate of Incorporation or by-laws may be
amended, modified or repealed if the result would be to materially adversely
affect the Executive’s right to indemnification from the Company.
7.3
Assignability

The obligations of the Executive hereunder are personal and may not be assigned
or delegated by the Executive or transferred in any manner whatsoever, nor are
such obligations subject to involuntary alienation, assignment or transfer. The
Company shall have the right to assign this Agreement and to delegate all
rights, duties and obligations hereunder as provided in Section 7.6.
7.4
Notices

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All notices and all other communications provided for in the Agreement shall be
in writing and addressed (a) if to the Company, at its principal office address
or such other address as it may have designated by written notice to the
Executive for purposes hereof, directed to the attention of the Board of
Managers with a copy to the Secretary of the Company and (b) if to the
Executive, at the Executive’s residence address on the records of the Company or
to such other address as the Executive may have designated to the Company in
writing for purposes hereof. Each such notice or other communication shall be
deemed to have been duly given when delivered or mailed by United States
registered mail, return receipt requested, postage prepaid, except that any
notice of change of address shall be effective only upon receipt.
7.5
Severability

The invalidity or unenforceability of any provision of this Agreement shall not
affect the validity or enforceability of any other provision of this Agreement,
which shall remain in full force and effect.
7.6
Successors: Binding Agreement

(a)    The Company and Executive agree that this Agreement and all of the
Company’s rights and obligations hereunder may be assigned or transferred by the
Company to and may be assumed by and become binding upon and may inure to the
benefit of any affiliate of or successor to the Company. The term “affiliate”
shall mean (with respect to the Company) any other corporation or other business
entity of which the Company is, directly or indirectly, the majority
equityholder. The term “successor” shall mean (with respect to the Company) any
other corporation or other business entity that, by merger, consolidation,
purchase of the assets, or otherwise, acquires all or a material part of its
assets or equity. Any assignment by the Company of its rights or obligations
hereunder to any affiliate of or successor to the Company shall not be a
termination of employment for purposes of this Agreement. Except as provided in
paragraph (b) below, on and after the date of any such assignment, the Executive
shall have no recourse to the Company for any amounts alleged to be due under
this Agreement on or after the date of such assignment.
(b)    The Company will require any affiliate or successor to which this
Agreement and the Company’s rights and obligations hereunder are assigned
expressly to assume and agree to perform this Agreement in the same manner and
to the same extent that the Company would be required to perform it if no such
assignment had taken place. Failure of the Company to obtain such agreement in
connection with any such assignment shall not excuse performance by any party.
As used herein, and where the context requires, the term “Company” shall include
any affiliate or successor to which this Agreement and the Company’s rights and
obligations hereunder are assigned.
(c)    This Agreement and all rights of the Executive hereunder shall inure to
the benefit of and be enforceable by the Executive’s personal or legal
representatives, executors, administrators, successors, heirs, distributes,
devisees and legatees. If the Executive should die while any amounts would be
payable to the Executive hereunder if the Executive had continued to live, all
such amounts, unless otherwise provided herein, shall be paid in accordance with
the

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terms of this Agreement to the Executive’s devisee, legatee, or other designee
or, if there be no such designee, to the Executive’s estate.
7.7
Tax Matters

The Company shall withhold from all payments hereunder all applicable taxes
(federal, state or other) that it is required to withhold therefrom unless the
Executive has otherwise paid (or made other arrangements satisfactory) to the
Company the amount of such taxes.
7.8
Section 409A of the Code

This Agreement is intended to comply with the requirements of Section 409A of
the Code (including the exceptions thereto), to the extent applicable, and the
Company shall administer and interpret this Agreement in accordance with such
requirements. Notwithstanding any other provision hereof, if any provision of
this Agreement conflicts with the requirements of Section 409A of the Code, the
requirements of Section 409A of the Code shall supersede any such provision.

In no event whatsoever shall the Company be liable for any additional tax,
interest or penalties that may be imposed on the Executive by Section 409A of
the Code or any damages for failing to comply with Section 409A of the Code.
7.9
Certain Terminations.

Unless the Executive expressly agrees otherwise, if the Company gives written
notice of its intent to discontinue the daily extensions of the Term as provided
for in Section 2.2 hereof within the two months preceding or the 18 months
following a Change of Control, the giving of such notice shall be treated as a
termination by the Company for other than Misconduct as of the date such notice
is given.
7.10
Amendments and Waivers

No provision of this Agreement may be modified, waived or discharged unless such
waiver, modification or discharge is agreed to in writing and signed by the
Executive and the Company. No waiver by either party hereto at any time of any
breach by the other party hereto of, or in compliance with, any condition or
provision of this Agreement to be performed by such other party shall be deemed
a waiver of similar or dissimilar provisions or conditions at the same or at any
prior or subsequent time.
7.11
Entire Agreement, Termination of Other Agreements

This Agreement is an integration of the parties’ agreement and no agreements or
representations, oral or otherwise, express or implied, with respect to the
subject matter hereof have been made by either party that are not set forth
expressly in this Agreement.
7.12
Governing Law

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THE VALIDITY, INTERPRETATION, CONSTRUCTION AND PERFORMANCE OF THIS AGREEMENT
SHALL BE GOVERNED BY THE LAWS OF THE STATE OF MARYLAND, WITHOUT REGARD TO ITS
CONFLICT OF LAWS PROVISIONS.
7.13
Counterparts

This Agreement may be executed in or more counterparts, each of which shall be
deemed to be an original, but all of which together will constitute one and the
same instrument.
*    *    *    *    *
IN WITNESS WHEREOF, the parties have executed this Agreement on March 30, 2012.
 
 
AMERICAN CAPITAL MORTGAGE MANAGEMENT, LLC
 
 
By:
       /s/ Malon Wilkus
Malon Wilkus, Chief Executive Officer
 
 
 
THE EXECUTIVE:
 
 
          /s/ Christopher Kuehl

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EXHIBIT A
TARGET INCENTIVE PAYMENT AND PIP AWARDS
1.    Target Incentive Payments.
The Executive’s Target Incentive Payments for each calendar year beginning for
2012 shall be based in part on the Company’s performance on certain performance
metrics (“Performance Metric”) in relation to the Company’s “Peer Group” (as
defined below), and in part on subjective criteria chosen by the Board of
Managers in its reasonable discretion (the “Board Criteria”). The Performance
Metrics are “Company Price to Book Ratio,” “Company Economic Return” and
“Company Total Stock Return,” each as defined below. In the event that the
Company becomes investment manager for a Company Managed Fund that is not a
Publicly Traded Company Managed Fund, the Board of Managers and the President
will work in good faith to establish alternative Performance Metrics that will
apply with respect to such non-Publicly Traded Company Managed Fund.
The Target Incentive Payment shall be paid based on the extent to which the
specific performance goals are satisfied on a quarterly basis and on an annual
basis. Each calendar quarter, the Executive will be eligible to earn an amount
up to the Quarterly Target Incentive Payment Amount, and for the calendar year
the Executive will be eligible to earn a Target Incentive Payment up to his
Target Incentive Payment Amount less the aggregate Quarterly Target Incentive
Payments that have been paid with regard to such calendar year.
The portion of any Target Incentive Payment to which the Executive will be
entitled for any quarterly period will be determined by first calculating the
score for each of the three Performance Metrics in the table below and the Board
Criteria and multiplying it by the Weight Percentage and adding them together
(the “Weighted Score”), then dividing the Weighted Score by 4, and multiplying
that amount by 100 to arrive at the “Incentive Payment Percentage.” The Company
agrees to provide in writing to the Executive the applicable quarterly
subjective evaluation and the overall quarterly “Incentive Payment Percentage”
no later than the delivery of the applicable Target Incentive Payment.
The portion of the Target Incentive Payment Amount which the Executive will be
entitled to earn for the full year (before deducting the Quarterly Target
Incentive Payment Amounts that have been paid with regard to such year) will be
determined based on averaging the “Adjusted Weighted Score” for each of the four
quarters in the year, where the Adjusted Weighted Score for each quarter shall
equal the Weighted Score for such quarter recalculated using the Company Total
Stock Return calculated on a full year basis, and then dividing such average by
4 and multiplying the amount by 100 to arrive at the “Annual Incentive Payment
Percentage.”

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Performance Metric
Weight %
Score
Company Price to Book
33-1/3%
•
    >0% of Peer Member Price to Book = 0
•
    Linear interpolation between 0 and 4 depending on the percentage of Peer
Group members that have a Peer Member Price to Book for the particular quarter
or calendar year that is equal to or less than the Company Price to Book for
such period.
•
    >=80% of Peer Member Price to Book= 4
Company Economic Return
16-2/3%
•
    >0% of Peer Member Economic Return = 0
•
    Linear interpolation between 0 and 4 depending on the percentage of Peer
Group members that have a Peer Member Economic Return for the particular quarter
or calendar year that is equal to or less than the Company Economic Return for
such period.
•
    >=80% of Peer Member Economic Return = 4

Company Total Stock Return
16-2/3%
•
    >0% of Peer Member Total Stock Return = 0
•
    Linear interpolation between 0 and 4 depending on the percentage of Peer
Group members that have a Peer Member Total Stock Return for the particular
quarter or calendar year that is equal to or less than the Company Total Stock
Return for such period.
•
    >=80% of Peer Member Total Stock Return = 4
Board Criteria
33-1/3%
Determined by Board of Managers in its reasonable discretion.

Example: Assume the Executive is paid Base Salary for an entire calendar year at
a rate of $900,000, so that the Quarterly Target Incentive Payment Amount is
$225,000. Assume further that for the first and second calendar quarters, (i)
the Company Price to Book is greater than the Peer Member Price to Book of 40%
of the members of its Peer Group, (ii) the Company Economic Return is greater
than the Peer Member Economic Return of 0% of the members of its Peer Group, and
(iii) the Company Total Stock Return is greater than the Peer Member Total Stock
return of 80% of the members of its Peer Group.
Assume further that for the third and fourth calendar quarters, (i) the Company
Price to Book is greater than the Peer Member Price to Book of 20% of the
members of its Peer Group, (ii) the Company Economic Return is greater than the
Peer Member Economic Return of 60% of the members of its Peer Group, and (iii)
the Company Total Stock Return is greater than the Peer Member Total Stock
return of 40% of the members of its Peer Group.

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Assume in addition that for the entire calendar year, the Company Total Stock
Return is greater than the Peer Member Total Stock return of 80% of the members
of its Peer Group.
Assume finally that for each calendar quarter and for the calendar year the
Executive has completely satisfied the subjective criteria established by the
Board of Managers in its reasonable discretion (and thus the score for all
quarters was 4).
The Weighted Score for the first and second quarters would equal 2-2/3 ((1/3 *
2) + (1/6 * 0) + (1/6 * 4) + (1/3 * 4)), and the Incentive Payment Percentage
for the first and second quarters would equal 66-2/3% ((2-2/3)/4 * 100). The
Executive would be entitled to Target Incentive Payments for each of the first
and second quarters of $150,000 ($225,000 * 66-2/3%).
The Weighted Score for the third and fourth quarters would equal 2.5 ((1/3 * 1)
+ (1/6 * 3) + (1/6 * 2) + (1/3 * 4)), and the Incentive Payment Percentage for
the third and fourth quarters would equal 62.5% (2.5/4 * 100). The Executive
would be entitled to Target Incentive Payments for each of the third and fourth
quarters of $140,625 ($225,000 * 62.5%).
The Weighted Score for the calendar year would equal 2.75 or the arithmetic
average of the four quarters (2-2/3, 2-2/3, 2-5/6, and 2-5/6) after replacing
the Quarterly Total Stock Return with the Actual Annual Total Stock Return
Figure. The 3rd and 4th quarter numbers in this example were recalculated for
the purposes of the Annual Incentive Payment calculation to use the full year
Total Stock Return of 100 % rather than the original 3rd and 4th quarter numbers
of 50 % as follows: ((.1/3 * 1) + (1/6 * 3) + (1/6 * 4) + (1/3 * 4)) Therefore,
the Annual Incentive Payment Percentage would equal 68.75% (2.75/4 * 100). The
Executive’s Calendar Year Total Annual Incentive Payment Amount would equal
$1,237,500 ($1,800,000*0.6875). The Executive’s actual cash Annual Incentive
Payment would equal $ 656,250 ($1,237,500– $150,000 - $150,000 - $140,625 -
$140,625).
Any Target Incentive Payment to which the Executive becomes entitled will be
paid no later than the 75th day immediately following the last day of the period
to which such Target Incentive Payment relates. Except as set forth in Article 4
of the Agreement, the Executive must be employed on the Target Incentive Payment
date to be entitled to payment.
In the event that there shall be a Company Managed Fund that does not have
publicly‑traded equity securities, the Board of Managers will work with the
President to make appropriate adjustments to this Section 1 to provide a basis
for awarding Target Incentive Payments to the Executive attributable to such
Company Managed Fund.

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2.    Definitions.
Capitalized terms used in this Exhibit A and not otherwise defined herein shall
have the meanings ascribed to such terms in the Employment Agreement.
“Company Economic Return” for any period means the ratio of (a) the sum of (i)
the sum of the positive or negative changes in net asset value of a share of the
common stock of each Publicly Traded Company Managed Fund from the last day of
the prior period to the last day of the relevant period, and (ii) the sum of any
dividends declared with respect to a share of common stock of each Publicly
Traded Company Managed Fund during the relevant period, over (b) the sum of the
net asset values of a share of common stock of each Publicly Traded Company
Managed Fund on the last day of the prior period.
“Company Price to Book” as of any date means the ratio of (a) the sum of Fair
Market Values of a share of common stock of each Publicly Traded Company Managed
Fund, over (b) the sum of the net asset values of all Publicly Traded Company
Managed Funds as of the most recent quarter end as determined by the reasonable
application of such reasonable method as may be chosen by the Board of Managers
in good faith. When determined in connection with a payment based on performance
in a calendar quarter, the Company Price to Book shall be calculated as of the
last business day of such quarter, and when determined in connection with a
payment or award based on performance in a calendar year, the Company Price to
Book shall be calculated as of the last business day of such year.
“Company Total Stock Return” for any period means the ratio of (a) the sum of
(i) the sum of the positive or negative changes in Fair Market Value of a share
of the common stock of each Publicly Traded Company Managed Fund from the last
day of the prior period to the last day of the relevant period, and (ii) the sum
of any dividends declared with respect to a share of common stock of each
Publicly Traded Company Managed Fund during the relevant period, over (b) the
sum of the Fair Market Values of a share of common stock of each Publicly Traded
Company Managed Fund on the last day of the prior period.
“Fair Market Value” as of any date means the value of a security determined as
follows: (a) if shares of such security are listed on any established exchange
or traded on The NASDAQ Global Select Market, the Fair Market Value of a share
of such security shall be the closing sales price for such security (or the
closing bid, if no sales were reported) as quoted on such exchange or market (or
the exchange or market with the greatest volume of trading in the security) as
of such date, as reported in The Wall Street Journal or such other source as the
Board of Managers deems reliable; or (b) in the absence of such an exchange or
market for such security, the Fair Market Value shall be determined by the
reasonable application of such other reasonable method as may be chosen by the
Board of Managers in good faith.
“Peer Group” means a group of peer companies determined by the Board of Managers
for each calendar year in its reasonable discretion and communicated to the
Executive in writing.
“Peer Member Economic Return” for any period means, for any entity that is a
member of the Peer Group, the ratio of (a) the sum of (i) the sum of the
positive or negative changes in net asset

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value of a share of the common stock of such member of the Peer Group from the
last day of the prior period to the last day of the relevant period, and (ii)
the sum of any dividends declared with respect to a share of common stock of
such member of the Peer Group during the relevant period, over (b) the sum of
the net asset values of a share of common stock of such member of the Peer Group
on the last day of the prior period.
“Peer Member Price to Book” as of any date means, for any entity that is a
member of the Peer Group, the ratio of (a) the closing price for a share of
common stock of such entity, over (b) the reported net asset value per share of
common stock for such entity for the most recent quarter end. When determined in
connection with a payment based on performance in a calendar quarter, Peer
Member Price to Book shall be calculated as of the last business day of such
quarter, and when determined in connection with a payment or award based on
performance in a calendar year, Peer Member Price to Book shall be calculated as
of the last business day of such year.
“Peer Member Total Stock Return” for any period means, for any entity that is a
member of the Peer Group, the ratio of (a) the sum of (i) the positive or
negative change in Fair Market Value of a share of the common stock of such
entity from the last day of the prior period to the last day of the relevant
period, and (ii) any dividends declared with respect to a share of common stock
of such entity during the relevant period, over (b) the Fair Market Value of a
share of the common stock of such entity on the last day of the prior period.
“Publicly Traded Company Managed Fund” means any Company Managed Fund the equity
shares of which are listed on any established exchange or traded on The NASDAQ
Global Select Market.

5

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EXHIBIT 3.3(c)-AGNC
Memorandum and Acceptance Agreement

To:
Christopher J. Kuehl

From:
American Capital Mortgage Management, LLC

Date:    

Re:
Performance Incentive Plan - AGNC Award

--------------------------------------------------------------------------------

We are pleased to inform you that on _________, _____, American Capital Mortgage
Management, LLC (the “Company”) granted you an Incentive Award (the “Award”)
under the terms of the American Capital Mortgage Management, LLC Performance
Incentive Plan – AGNC (the “Plan”) in the amount of $____________, subject to
your acceptance of and agreement to the terms and conditions described in this
Memorandum and Acceptance Agreement (this “Agreement”). As your Award vests, it
will be paid to you. You may not elect to defer payment of this Award.
Capitalized terms used in this Agreement that are not otherwise defined herein
shall have the meanings ascribed to such terms in the Plan.
Your Award consists of five (5) equal installments (each, an “Installment”),
each of which shall be considered a separate payment for purposes of Section
409A of the Code. Your Installments shall vest on the following vesting schedule
(notwithstanding Section 6.3(b) of the Plan), subject to the conditions set
forth below and in the Plan:
Installment
Vesting Date
First Installment
Earlier of [Insert One-Year Anniversary of the Date of Grant] and eighteen (18)
month anniversary of a Qualifying Separation from Service
Second Installment
Earlier of [Insert Two-Year Anniversary of the Date of Grant] and eighteen (18)
month anniversary of a Qualifying Separation from Service
Third Installment
Earlier of [Insert Three-Year Anniversary of the Date of Grant] and eighteen
(18) month anniversary of a Qualifying Separation from Service
Fourth Installment
Earlier of [Insert Four-Year Anniversary of the Date of Grant] and eighteen (18)
month anniversary of a Qualifying Separation from Service
Fifth Installment
Earlier of [Insert Five-Year Anniversary of the Date of Grant] and eighteen (18)
month anniversary of a Qualifying Separation from Service

1

--------------------------------------------------------------------------------

For purposes of this Agreement, a “Qualifying Separation from Service” means
your Separation from Service by the Company other than for “Misconduct” (as
defined in your Employment Agreement with the Company dated as of March ___,
2012 (the “Employment Agreement”)) or by you with “Good Reason” (as defined in
the Employment Agreement).
Notwithstanding the foregoing, your Award will immediately cease to vest in the
event of, and no Installment payments shall be made after, a Separation from
Service that is not a Qualifying Separation from Service; provided that all
Installments not previously forfeited shall fully vest immediately upon your
death or becoming Disabled, or upon the occurrence of a Change of Control, in
accordance with Section 6.3(a) of the Plan.
In addition, your Award will immediately cease to vest in the event that, and no
Installment payments shall be made after, the Committee reasonably determines
that you have breached any provision of Article V of the Employment Agreement.
Notwithstanding any other provision of the Plan, each Installment will be paid
as soon as practicable (and in no event more than thirty (30) days) after the
date on which it vests.
You agree that you will cooperate with the Company to facilitate payment of
Installments, which cooperation may include being required to maintain a
brokerage account with the Plan’s recordkeeper.
Please note that the Plan and this Agreement are intended to comply, and shall
be interpreted in a manner consistent, with the requirements of Section 409A of
the Code and the regulations and other regulatory guidance thereunder. In no
event will the Company or any affiliate be liable for any tax, interest or
penalties that may be imposed by Section 409A of the Code or any damages for
failing to comply with Section 409A of the Code. In addition, please note that
the Company shall comply with six-month delay provisions of Section
409A(a)(2)(B) of the Code to the extent applicable.
If you have any questions, please contact your Human Resources representative.

2

--------------------------------------------------------------------------------

Otherwise, please sign below and return to ___________ by ___________ to accept
and agree to the terms of the Award, including your agreement that the Award is
fully subject to, and governed by, the terms of the Plan (as specifically
modified herein), a copy of which the Company has previously provided to you.
Sincerely,

American Capital Mortgage Management, LLC

Accepted and agreed this __________ day of ___________:

                
Christopher J. Kuehl

3

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EXHIBIT 3.3(c)-MTGE
Memorandum and Acceptance Agreement

To:
Christopher J. Kuehl

From:
American Capital Mortgage Management, LLC

Date:    

Re:
Performance Incentive Plan - MTGE Award

--------------------------------------------------------------------------------

We are pleased to inform you that on _________, _____, American Capital Mortgage
Management, LLC (the “Company”) granted you an Incentive Award (the “Award”)
under the terms of the American Capital Mortgage Management, LLC Performance
Incentive Plan – MTGE (the “Plan”) in the amount of $____________, subject to
your acceptance of and agreement to the terms and conditions described in this
Memorandum and Acceptance Agreement (this “Agreement”). As your Award vests, it
will be paid to you. You may not elect to defer payment of this Award.
Capitalized terms used in this Agreement that are not otherwise defined herein
shall have the meanings ascribed to such terms in the Plan.
Your Award consists of five (5) equal installments (each, an “Installment”),
each of which shall be considered a separate payment for purposes of Section
409A of the Code. Your Installments shall vest on the following vesting schedule
(notwithstanding Section 6.3(b) of the Plan), subject to the conditions set
forth below and in the Plan:
Installment
Vesting Date
First Installment
Earlier of [Insert One-Year Anniversary of the Date of Grant] and eighteen (18)
month anniversary of a Qualifying Separation from Service
Second Installment
Earlier of [Insert Two-Year Anniversary of the Date of Grant] and eighteen (18)
month anniversary of a Qualifying Separation from Service
Third Installment
Earlier of [Insert Three-Year Anniversary of the Date of Grant] and eighteen
(18) month anniversary of a Qualifying Separation from Service
Fourth Installment
Earlier of [Insert Four-Year Anniversary of the Date of Grant] and eighteen (18)
month anniversary of a Qualifying Separation from Service
Fifth Installment
Earlier of [Insert Five-Year Anniversary of the Date of Grant] and eighteen (18)
month anniversary of a Qualifying Separation from Service

    

1

--------------------------------------------------------------------------------

For purposes of this Agreement, a “Qualifying Separation from Service” means
your Separation from Service by the Company other than for “Misconduct” (as
defined in your Employment Agreement with the Company dated as of March ___,
2012 (the “Employment Agreement”)) or by you with “Good Reason” (as defined in
the Employment Agreement).
Notwithstanding the foregoing, your Award will immediately cease to vest in the
event of, and no Installment payments shall be made after, a Separation from
Service that is not a Qualifying Separation from Service; provided that all
Installments not previously forfeited shall fully vest immediately upon your
death or becoming Disabled, or upon the occurrence of a Change of Control, in
accordance with Section 6.3(a) of the Plan.
In addition, your Award will immediately cease to vest in the event that, and no
Installment payments shall be made after, the Committee reasonably determines
that you have breached any provision of Article V of the Employment Agreement.
Notwithstanding any other provision of the Plan, each Installment will be paid
as soon as practicable (and in no event more than thirty (30) days) after the
date on which it vests.
You agree that you will cooperate with the Company to facilitate payment of
Installments, which cooperation may include being required to maintain a
brokerage account with the Plan’s recordkeeper.
Please note that the Plan and this Agreement are intended to comply, and shall
be interpreted in a manner consistent, with the requirements of Section 409A of
the Code and the regulations and other regulatory guidance thereunder. In no
event will the Company or any affiliate be liable for any tax, interest or
penalties that may be imposed by Section 409A of the Code or any damages for
failing to comply with Section 409A of the Code. In addition, please note that
the Company shall comply with six-month delay provisions of Section
409A(a)(2)(B) of the Code to the extent applicable.
If you have any questions, please contact your Human Resources representative.

2

--------------------------------------------------------------------------------

Otherwise, please sign below and return to ___________ by ___________ to accept
and agree to the terms of the Award, including your agreement that the Award is
fully subject to, and governed by, the terms of the Plan (as specifically
modified herein), a copy of which the Company has previously provided to you.
Sincerely,

American Capital Mortgage Management, LLC

Accepted and agreed this __________ day of ___________:

                
Christopher J. Kuehl

3

--------------------------------------------------------------------------------

EXHIBIT 4.5(c)-AGNC

Memorandum and Acceptance Agreement

To:
Christopher J. Kuehl

From:
American Capital Mortgage Management, LLC

Date:    

Re:
Performance Incentive Plan - AGNC Award

--------------------------------------------------------------------------------

We are pleased to inform you that on _________, _____, American Capital Mortgage
Management, LLC (the “Company”) granted you an Incentive Award (the “Award”)
under the terms of the American Capital Mortgage Management, LLC Performance
Incentive Plan – AGNC (the “Plan”) in the amount of $____________ (the “Total
Amount”), subject to your acceptance of and agreement to the terms and
conditions described in this Memorandum and Acceptance Agreement (this
“Agreement”). As your Award vests, it will be paid to you. You may not elect to
defer payment of this Award. Capitalized terms used in this Agreement that are
not otherwise defined herein shall have the meanings ascribed to such terms in
the Plan.
Your Award consists of two (2) installments (each, an “Installment”), the first
Installment equal to twenty percent (20%) of the Total Amount and the second
Installment equal to eighty percent (80%) of the Total Amount. Each Installment
shall be considered a separate payment for purposes of Section 409A of the Code.
Your Installments shall vest on the following vesting schedule (notwithstanding
Section 6.3(b) of the Plan), subject to the conditions set forth below and in
the Plan:

Installment
Vesting Date

First Installment

[Insert one-year anniversary date of Termination Date]

Second Installment

[Insert eighteen (18) month anniversary date of Termination Date]

1

--------------------------------------------------------------------------------

Notwithstanding the foregoing, your Award will immediately cease to vest in the
event that, and no Installment payments shall be made after, the Committee
reasonably determines that you have breached any provision of Article V of the
Employment Agreement between you and the Company dated March __, 2012.
Notwithstanding any other provision of the Plan, each Installment will be paid
as soon as practicable (and in no event more than thirty (30) days) after the
date on which it vests.
You agree that you will cooperate with the Company to facilitate payment of
Installments, which cooperation may include being required to maintain a
brokerage account with the Plan’s recordkeeper.
Please note that the Plan and this Agreement are intended to comply, and shall
be interpreted in a manner consistent, with the requirements of Section 409A of
the Code and the regulations and other regulatory guidance thereunder. In no
event will the Company or any affiliate be liable for any tax, interest or
penalties that may be imposed by Section 409A of the Code or any damages for
failing to comply with Section 409A of the Code. In addition, please note that
the Company shall comply with six-month delay provisions of Section
409A(a)(2)(B) of the Code to the extent applicable.
If you have any questions, please contact your Human Resources representative.
Otherwise, please sign below and return to ___________ by ___________ to accept
and agree to the terms of the Award, including your agreement that the Award is
fully subject to, and governed by, the terms of the Plan (as specifically
modified herein), a copy of which the Company has previously provided to you.
Sincerely,

American Capital Mortgage Management, LLC

Accepted and agreed this __________ day of ___________:

                
Christopher J. Kuehl

2

--------------------------------------------------------------------------------

3

--------------------------------------------------------------------------------

EXHIBIT 4.5(c)-MTGE
Memorandum and Acceptance Agreement

To:
Christopher J. Kuehl

From:
American Capital Mortgage Management, LLC

Date:    

Re:
Performance Incentive Plan - MTGE Award

--------------------------------------------------------------------------------

We are pleased to inform you that on _________, _____, American Capital Mortgage
Management, LLC (the “Company”) granted you an Incentive Award (the “Award”)
under the terms of the American Capital Mortgage Management, LLC Performance
Incentive Plan – MTGE (the “Plan”) in the amount of $____________ (the “Total
Amount”), subject to your acceptance of and agreement to the terms and
conditions described in this Memorandum and Acceptance Agreement (this
“Agreement”). As your Award vests, it will be paid to you. You may not elect to
defer payment of this Award. Capitalized terms used in this Agreement that are
not otherwise defined herein shall have the meanings ascribed to such terms in
the Plan.
Your Award consists of two (2) installments (each, an “Installment”), the first
Installment equal to twenty percent (20%) of the Total Amount and the second
Installment equal to eighty percent (80%) of the Total Amount. Each Installment
shall be considered a separate payment for purposes of Section 409A of the Code.
Your Installments shall vest on the following vesting schedule (notwithstanding
Section 6.3(b) of the Plan), subject to the conditions set forth below and in
the Plan:

Installment
Vesting Date

First Installment

[Insert one-year anniversary date of Termination Date]

Second Installment

[Insert eighteen (18) month anniversary date of Termination Date]

1

--------------------------------------------------------------------------------

Notwithstanding the foregoing, your Award will immediately cease to vest in the
event that, and no Installment payments shall be made after, the Committee
reasonably determines that you have breached any provision of Article V of the
Employment Agreement between you and the Company dated March __, 2012.
Notwithstanding any other provision of the Plan, each Installment will be paid
as soon as practicable (and in no event more than thirty (30) days) after the
date on which it vests.
You agree that you will cooperate with the Company to facilitate payment of
Installments, which cooperation may include being required to maintain a
brokerage account with the Plan’s recordkeeper.
Please note that the Plan and this Agreement are intended to comply, and shall
be interpreted in a manner consistent, with the requirements of Section 409A of
the Code and the regulations and other regulatory guidance thereunder. In no
event will the Company or any affiliate be liable for any tax, interest or
penalties that may be imposed by Section 409A of the Code or any damages for
failing to comply with Section 409A of the Code. In addition, please note that
the Company shall comply with six-month delay provisions of Section
409A(a)(2)(B) of the Code to the extent applicable.
If you have any questions, please contact your Human Resources representative.
Otherwise, please sign below and return to ___________ by ___________ to accept
and agree to the terms of the Award, including your agreement that the Award is
fully subject to, and governed by, the terms of the Plan (as specifically
modified herein), a copy of which the Company has previously provided to you.
Sincerely,

American Capital Mortgage Management, LLC

Accepted and agreed this __________ day of ___________:

                
Christopher J. Kuehl

2

--------------------------------------------------------------------------------

EXHIBIT 4.5(d)
RELEASE AGREEMENT
THIS RELEASE AGREEMENT (the “Agreement”), is made as of the            day
of            ,            , by and between AMERICAN CAPITAL MORTGAGE
MANAGEMENT, LLC, a Delaware limited liability company with its principal place
of business at 2 Bethesda Metro Center, 14th Floor, Bethesda, Maryland (the
“Company”), and CHRISTOPHER J. KUEHL, an individual (the “Executive”).
W I T N E S S E T H:
WHEREAS, the parties hereto are parties to an Employment Agreement entered into
as of March __, 2012 (the “Employment Agreement”); and
WHEREAS, the execution and delivery of this Release Agreement as of the date
hereof is a requirement of Section 4.5(d) thereof.
NOW, THEREFORE, in consideration of the foregoing and of the mutual agreements
and covenants herein contained, and for other good and valuable consideration,
the receipt and sufficiency of which are hereby acknowledged, the parties agree
as follows:
1. Mutual Release.
(a) The Executive, on his own behalf and on behalf of his heirs, representatives
and assigns, hereby waives, releases, and forever and irrevocably discharges the
Company and the “Company Managed Funds” (as defined in the Employment
Agreement), and their agents, attorneys, officers, directors, employees,
successors and assigns (collectively, the “Company Released Parties”) from any
and all obligations, debts, demands, claims and liabilities of every kind and
nature, either in law or in equity, that the Executive may now have, may in the
future have or may ever have had, against the Company Released Parties arising
in any manner from or in any manner related, directly or indirectly, to the
Executive’s service or employment as a director, manager, officer and/or an
employee of the Company including, without limitation, the circumstances
relating to the termination thereof, except for such obligations as shall
specifically survive the termination of the Executive’s employment under the
terms of the Employment Agreement.
(b) The Company, on its own behalf and on behalf of its successors and assigns,
hereby waives, releases, and forever and irrevocably discharges the Executive,
and his agents, attorneys, heirs, representatives and assigns (collectively, the
“Executive Released Parties”) from any and all obligations, debts, demands,
claims and liabilities of every kind and nature, either in law or in equity,
that the Company may now have, may in the future have or may ever have had
against the Executive Released Parties arising in any manner from or in any
manner related to, directly or indirectly, the Executive’s service or employment
as a director, officer and/or an employee of the Company including, without
limitation, the circumstances relating to the

1

--------------------------------------------------------------------------------

termination thereof, except for such obligations as shall specifically survive
the termination of the Executive’s employment under the terms of the Employment
Agreement.
2. Miscellaneous. This Agreement constitutes the entire agreement between the
parties hereto with regard to the subject matter hereof and supersedes all prior
negotiations, representations and agreements, either written or oral, between
them except for the Surviving Agreements. There are no conditions, agreements,
or representations between the parties except those expressed herein. This
Agreement may be altered, modified, amended, or repealed only by a duly executed
written instrument signed by the parties hereto. This Agreement shall be
governed by the law of the State of Maryland, without giving effect to the
conflicts of laws provisions thereof. Each party binds himself or itself and his
or its heirs, successors, legal representatives and assigns in respect to all
covenants and agreements contained herein. Except as specifically contemplated
herein, nothing herein shall be construed as giving any right or benefit
hereunder to anyone other than the parties hereto.
IN WITNESS WHEREOF, the parties have executed this Agreement under seal as of
the date first hereinabove written.
WITNESS:
 
THE EXECUTIVE:

 

(Seal)
 
 
 
AMERICAN CAPITAL MORTGAGE MANAGEMENT, LLC 
A Delaware Limited Liability Company
 
 
By:

Name:
Title
(Seal)

2

--------------------------------------------------------------------------------

Schedule 1

(b)
    None.

1