Unassociated Document


    AMENDED
      AND RESTATED

    EMPLOYMENT
      AGREEMENT

     

    THIS
      AMENDED AND RESTATED EMPLOYMENT AGREEMENT (this "Agreement") is
      entered into as of the 1st day of January, 2008, by and between MFA MORTGAGE
      INVESTMENTS, INC., a Maryland corporation ("MFA"), and TIMOTHY
      W.
      KORTH II, residing at the address
      set forth on the signature page hereof (the "Executive").

     

    W
      I T N E
      S S E T H:

     

    WHEREAS,
      MFA and the Executive entered into an employment agreement effective as of
      January 1, 2006 (the "Employment
      Agreement");

     

    WHEREAS,
      prior to such time as the Employment Agreement is required to be in documentary
      compliance with the requirements of Section 409A of the Code, MFA and the
      Executive desire to amend the terms of the Executive's employment and extend
      the
      period of employment set forth in the Employment Agreement to December 31,
      2009 on the terms and conditions set forth in this Agreement; and

     

    WHEREAS,
      the Executive wishes to continue serving MFA and MFA wishes to secure the
      continued exclusive services of the Executive under the terms and conditions
      described below.

     

    NOW,
      THEREFORE, in consideration of the foregoing premises and the mutual agreements
      herein contained, the parties hereto agree to amend and restate the Employment
      Agreement in its entirety to read as follows:

     

    1. Term
      of
      Employment.

     

    (a) MFA
      hereby employs the Executive, and the Executive hereby accepts employment with
      MFA, in the positions and with the duties and responsibilities as set forth
      in
      Paragraph 2 below for the Term of Employment, subject to the terms and
      conditions of this Agreement.

     

    (b) The
      term
      of employment (the "Term of Employment")
      under this Agreement shall include the Initial Term and each Renewal
      Term.  The Initial Term shall commence as of January 1, 2008 and shall
      continue until December 31, 2009.  The Term of Employment shall
      automatically renew for a one-year period (each such renewal, a "Renewal Term") at the
      end of the Initial Term and each Renewal Term, unless either party shall give
      notice to the other not less than six months prior to the end of the Initial
      Term or any Renewal Term, as the case may be, of his or its intent not to renew
      such Initial Term or Renewal Term, as the case may
      be.  Notwithstanding the foregoing sentences of this
      Paragraph 1(b), the Term of Employment may be terminated before the
      expiration of the Initial Term or any Renewal Term in accordance with
      Paragraph 5 hereof.

     

    2. Position;
      Duties and
      Responsibilities.

     

    (a) During
      the Term of Employment, the Executive shall be employed as General Counsel,
      Senior Vice President – Business Development and Corporate Secretary of MFA,
      reporting to the President and Chief Executive Officer of MFA (the "CEO") and, as
      such,
      shall (i) perform, administer, manage, monitor and/or coordinate all legal
      services required to be performed by or on behalf of MFA and its subsidiaries,
      (ii) be responsible for analyzing, developing and implementing new business
      initiatives for MFA and its subsidiaries and (iii) perform such other
      duties of an executive, managerial or administrative nature as shall be
      specified and designated from time to time by the CEO and/or the Board of
      Directors of MFA (the "Board of
      Directors").

     

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

     

    (b) During
      the Term of Employment, the Executive shall, without additional compensation,
      also serve on the board of directors of, serve as an officer of, and/or perform
      such executive and consulting services for, or on behalf of, such subsidiaries
      or affiliates of MFA as the CEO and/or the Board of Directors may, from time
      to
      time, request.  MFA and such subsidiaries and affiliates are
      hereinafter referred to, collectively, as the "Company."  For purposes
      of this Agreement, the term "affiliate" shall have the meaning ascribed thereto
      in Rule 12b-2 under the Securities Exchange Act of 1934, as amended (the
      "Act").

     

    (c) During
      the Term of Employment, the Executive shall serve MFA faithfully, diligently
      and
      to the best of his ability and shall devote substantially all of his time and
      efforts to his employment and the performance of his duties under this
      Agreement.  Nothing herein shall preclude the Executive from engaging
      in charitable and community affairs and managing his personal, financial and
      legal affairs, so long as such activities do not materially interfere with
      his
      carrying out his duties and responsibilities under this Agreement.

     

    3. Compensation.

     

    (a) Base
      Salary.  During the Term of Employment, MFA shall pay to the
      Executive a base salary (the "Base Salary") equal
      to $325,000 per annum.  The Base Salary shall be paid in accordance
      with MFA's normal payroll practices.

     

    (b) Performance
      Bonus.  The Executive shall be eligible to receive an annual
      performance bonus in such amount, in such manner and at such time as shall
      be
      recommended by the CEO and approved by the Compensation Committee of the Board
      of Directors (the "Compensation
      Committee") or the Board of Directors, as the case may be.

     

    (c) Equity
      Compensation.  The Executive shall be eligible to receive such
      stock option, restricted stock, phantom share or dividend equivalent rights
      ("DERs") grants
      or other equity awards as the Compensation Committee or the Board of Directors,
      as the case may be, shall deem appropriate.

     

    (d) Discretion
      to Increase
      Compensation.  Nothing in this Agreement shall preclude the
      Board of Directors or the Compensation Committee from increasing or considering
      increasing the Executive's compensation during the Term of
      Employment.  The Base Salary as adjusted to reflect any increase shall
      be the Base Salary for all purposes of this Agreement.

     

    4. Employee
      Benefit Programs and Fringe
      Benefits.

     

    During
      the Term of Employment, the Executive shall be entitled to four weeks of
      vacation each calendar year and to participate in all executive incentive and
      employee benefit programs of MFA now or hereafter made available to MFA's senior
      executives or salaried employees generally, as such programs may be in effect
      from time to time.  MFA shall reimburse the Executive for any and all
      necessary, customary and usual business expenses, properly receipted in
      accordance with MFA's policies, incurred by Executive in connection with his
      employment.

     

     

    
      
         

      

      
        2

        
          

        

      

      
         

      

    

     

     

    5. Termination
      of
      Employment.

     

    (a) Termination
      Due to Death or
      Disability.  If the Executive's employment is terminated during
      the Term of Employment by reason of the Executive's death or Disability, the
      Executive's Term of Employment shall terminate automatically without further
      obligations to the Executive, his legal representative or his estate, as the
      case may be, under this Agreement except for (i) any compensation earned
      but not yet paid, including and without limitation, any amount of Base Salary
      accrued or earned but unpaid and any other payments payable to the Executive
      pursuant to Paragraph 5(e) below, which amounts shall be promptly paid in a
      lump sum to the Executive, his legal representative or his estate, as the case
      may be, and (ii) continued payment on a monthly basis of the Executive's
      then current Base Salary for a period of one year following the date of such
      termination, which shall be paid to the Executive, his legal representative
      or
      his estate, as the case may be.  In the event of such termination due
      to his Disability, the Executive's health insurance coverage shall be continued
      at MFA's expense for the duration of such Disability; provided, that, if such
      coverage cannot be provided under MFA's health insurance policy for the duration
      of such Disability, such coverage or the cost of comparable coverage shall
      be
      provided by MFA until the Executive's attainment of age 65 or such later date
      through which coverage is permissible under MFA's health insurance
      policy.

     

    (b) Termination
      Without Cause or
      for Good Reason.  In the event the Executive's employment is
      terminated by MFA without Cause (which shall not include any non-renewal of
      this
      Agreement by MFA pursuant to Paragraph 1(b)) or by the Executive for Good
      Reason, unless any such termination is preceded by the Executive's giving notice
      of his determination not to renew the Initial Term or any Renewal Term pursuant
      to Paragraph 1(b), the Executive shall be entitled to both continued
      payments of his then current Base Salary and continued health insurance coverage
      at MFA's expense, until the later to occur of (i) the expiration of the
      Term of Employment, or (ii) the first anniversary of such termination of
      employment, such Base Salary being payable at the same time such amounts would
      have been payable to the Executive had his employment not
      terminated.

     

    (c) Termination
      by MFA for Cause
      or Voluntary Termination by the Executive.  In the event the
      Executive's employment is terminated by MFA for Cause or is terminated by the
      Executive on his own initiative for other than a Good Reason (including pursuant
      to Paragraph 1(b)), the Executive shall be entitled to any compensation
      earned but not yet paid, including and without limitation, any amount of Base
      Salary accrued or earned but unpaid and any other payments payable to the
      Executive pursuant to Paragraph 5(e) below, as of the date of
      termination.

     

    (d) Termination
      Related to
      Change in Control.  In the event of (1) the termination of
      the Executive's employment by MFA without Cause (which shall include any
      non-renewal of this Agreement by MFA pursuant to Paragraph 1(b)) that occurs
      both within two months before a Change in Control and following the occurrence
      of a Pre-Change-in-Control Event, (2) the resignation of his employment by
      the Executive for any reason within three months following a Change in Control,
      or (3) the termination of the Executive's employment by MFA other than for
      Cause (which shall include any non-renewal of this Agreement by MFA pursuant
      to
      Paragraph 1(b)) or the Executive's resignation of his employment for Good Reason
      within twelve months following a Change in Control,

     

    (i) MFA
      shall
      pay to Executive in a lump sum, within 30 days following the termination of
      employment, an amount equal to 250% of the sum of (a) the Executive's then
      current Base Salary and (b) the Executive's highest bonus for the two
      preceding years;

     

    (ii) all
      of
      the Executive's outstanding restricted stock, phantom shares and stock options
      shall immediately vest in full and such options shall remain exercisable, and
      any dividend equivalents associated therewith shall continue to be payable,
      until the earlier of (a) 90 days following the date of such termination and
      (b)
      the date on which each such option would have expired had the Executive’s
      employment not terminated; and

     

     

    
      
         

      

      
        3

        
          

        

      

      
         

      

    

     

     

    (iii) the
      Executive and his immediate family shall continue to participate in all health,
      life insurance, retirement and other benefit programs at MFA's expense for
      the
      balance of the Term of Employment, to the same extent as though the Executive's
      employment had not terminated.

     

    The
      Executive, in his sole and absolute discretion, may elect to reduce any such
      payment in order to avoid imposition of the excise tax under Section 4999
      of the Code.

     

    (e) Other
      Payments.  Upon the termination of the Executive's employment,
      in addition to the amounts payable under any Paragraph above, the Executive
      shall be entitled to receive the following:

     

    (i) any
      annual bonus earned during one or more preceding years but not
      paid;

     

    (ii) any
      vested deferred compensation (including any interest accrued on or appreciation
      in value of such deferred amounts);

     

    (iii) reimbursement
      for reasonable business expenses incurred but not yet reimbursed by MFA;
      and

     

    (iv) any
      other
      benefits to which the Executive or his legal representative may be entitled
      under the 2004 Equity Compensation Plan and under all other applicable plans
      and
      programs of MFA, as provided in Paragraph 4 above.

     

    (v) upon
      the
      termination of the Executive's employment pursuant to Paragraphs 5(a) or 5(b)
      above, all of the Executive's outstanding restricted stock, phantom shares
      and
      stock options shall immediately vest in full and such options shall remain
      exercisable, and any dividend equivalents associated therewith shall continue
      to
      be payable until the earlier of (a) 90 days following the date of such
      termination and (b) the date on which each such option would have expired had
      the Executive's employment not terminated.

     

    (f) No
      Mitigation; No
      Offset.  In the event of any termination of the Executive's
      employment under this Agreement, he shall be under no obligation to seek other
      employment or otherwise in any way to mitigate the amount of any payment
      provided for in this Paragraph 5, and there shall be no offset against
      amounts due him under this Agreement on account of any remuneration attributable
      to any subsequent employment that he may obtain.

     

    (g) Payments
      Subject to
      Section 409A.  Notwithstanding anything herein to the
      contrary, the Executive shall not be entitled to any payment pursuant to this
      Paragraph 5 prior to the earliest date permitted under Section 409A of
      the Code, and applicable Treasury regulations thereunder.  To the
      extent any payment pursuant to this Paragraph 5 is required to be delayed
      six months pursuant to the special rules of Section 409A related to
      "specified employees," each affected payment shall be delayed until six months
      after the Executive's termination of employment.  Each party to this
      Agreement intends and agrees that this Agreement shall be modified in a timely
      manner, as mutually agreed by both parties, to comply with Section 409A of
      the Code and the regulations thereunder.

     

     

    
      
         

      

      
        4

        
          

        

      

      
         

      

    

     

     

    (h) Mutual
      Release.  MFA’s obligation to make any payment or provide any
      benefit pursuant to this Paragraph 5 shall be contingent upon, and is the
      consideration for, the Executive executing and delivering to MFA a general
      release (the “Release”),
      substantially in the form annexed hereto as Exhibit A, releasing MFA, and all
      current and former members, officers and employees of MFA, from any claims
      relating to the Executive’s employment hereunder, other than claims relating to
      continuing obligations under, or preserved by, (x) this Agreement or
      (y) any compensation or benefit plan, program or arrangement in which the
      Executive was participating as of the date of termination of his employment,
      and
      no such amounts shall be provided until the Executive executes and delivers
      to
      MFA a letter which provides that the Executive had not revoked such Release
      after seven days following the date of the Release.  The Release shall
      also be executed by MFA and delivered to the Executive as part of the
      consideration for the Executive’s execution and delivery of the Release, and,
      except as otherwise provided under the terms of the Release, shall release
      the
      Executive from any and all claims MFA may have against the
      Executive.

     

    6. Definitions.

     

    For
      purposes of this Agreement, the following terms shall be defined as set forth
      below:

     

    (a) Cause.  "Cause"
      shall mean the Executive's (i) conviction, or entry of a guilty plea or a
      plea of nolo contendre with respect to, a felony, a crime of moral turpitude
      or
      any crime committed against MFA, other than traffic violations;
      (ii) engagement in willful misconduct, willful or gross negligence, or
      fraud, embezzlement or misappropriation relating to significant amounts, in
      each
      case in connection with the performance of his duties under this Agreement;
      (iii) failure to adhere to the lawful directions of the CEO and/or the
      Board of Directors that are reasonably consistent with his duties and position
      provided for herein; (iv) breach in any material respect of any of the
      provisions of Paragraph 7 of this Agreement resulting in material and
      demonstrable economic injury to MFA; (v) chronic or persistent substance
      abuse that materially and adversely affects his performance of his duties under
      this Agreement; or (vi) breach in any material respect of the terms and
      provisions of this Agreement resulting in material and demonstrable economic
      injury to MFA.  Notwithstanding the foregoing, (i) the Executive
      shall be given written notice of any action or failure to act that is alleged
      to
      constitute Cause (a "Default"), and an
      opportunity for 20 business days from the date of such notice in which to cure
      such Default, such period to be subject to extension in the discretion of the
      CEO or, in his absence, the Board of Directors; and (ii) regardless of
      whether the Executive is able to cure any Default, the Executive shall not
      be
      deemed to have been terminated for Cause without (x) reasonable prior
      written notice to the Executive setting forth the reasons for the decision
      to
      terminate the Executive for Cause, (y) an opportunity for the Executive,
      together with his counsel, to be heard by the CEO or, in his absence, the Board
      of Directors, and (z) delivery to the Executive of a notice of termination
      approved by said CEO or, in his absence, the Board of Directors, stating his
      or
      its good faith opinion that the Executive has engaged in actions or conduct
      described in the preceding sentence, which notice specifies the particulars
      of
      such action or conduct in reasonable detail; provided, however, MFA may suspend
      the Executive with pay until such time as his right to appear before the CEO
      or
      the Board of Directors, as the case may be, has been exercised, so long as
      such
      appearance is within two weeks of the date of suspension.

     

    (b) Change
      in
      Control.  A "Change in Control" shall mean the occurrence of
      any one of the following events:

     

    (i) any
      "person," as such term is used in Sections 13(d) and 14(d) of the Act
      (other than MFA, any of its affiliates or any trustee, fiduciary or other person
      or entity holding securities under any employee benefit plan or trust of MFA
      or
      any of its affiliates) together with all affiliates and "associates" (as such
      term is defined in Rule 12b-2 under the Act) of such person, shall become
      the "beneficial owner" (as such term is defined in Rule 13d-3 under the
      Act), directly or indirectly, of securities of MFA 

     

     

    
      
         

      

      
        5

        
          

        

      

      
         

      

    

     

     

    representing
      30% or more of either (A) the combined voting power of MFA's then
      outstanding securities having the right to vote in an election of the Board
      of
      Directors ("voting
      securities") or (B) the then outstanding shares of common stock of
      MFA ("Shares")
      (in either such case other than as a result of an acquisition of securities
      directly from MFA); or

     

    (ii) persons
      who, as of the effective date of this Agreement, constitute MFA's Board of
      Directors (the "Incumbent Directors")
      cease for any reason, including, without limitation, as a result of a tender
      offer, proxy contest, merger or similar transaction, to constitute at least
      a
      majority of the Board of Directors, provided that any person becoming a Director
      of MFA subsequent to the effective date whose election or nomination for
      election was approved by a vote of at least a majority of the Incumbent
      Directors shall, for purposes of this Agreement, be considered an Incumbent
      Director; or

     

    (iii) there
      shall occur (A) any consolidation or merger of MFA or any subsidiary where
      the stockholders of MFA, immediately prior to the consolidation or merger,
      would
      not, immediately after the consolidation or merger, beneficially own (as such
      term is defined in Rule 13d-3 under the Act), directly or indirectly,
      shares representing in the aggregate 60% or more of the voting securities of
      the
      corporation issuing cash or securities in the consolidation or merger (or of
      its
      ultimate parent corporation, if any), (B) any sale, lease, exchange or
      other transfer (in one transaction or a series of transactions contemplated
      or
      arranged by any party as a single plan) of all or substantially all of the
      assets of MFA or (C) any plan or proposal for the liquidation or
      dissolution of MFA.

     

    Notwithstanding
      the foregoing, a "Change in Control" shall not be deemed to have occurred for
      purposes of the foregoing clause (i) solely as the result of an acquisition
      of securities by MFA which, by reducing the number of Shares or other voting
      securities outstanding, increases (x) the proportionate number of Shares
      beneficially owned by any person to 30% or more of the Shares then outstanding
      or (y) the proportionate voting power represented by the voting securities
      beneficially owned by any person to 30% or more of the combined voting power
      of
      all then outstanding voting securities; provided, however, that, if any person
      referred to in clause (x) or (y) of this sentence shall thereafter become
      the beneficial owner of any additional Shares or other voting securities (other
      than pursuant to a stock split, stock dividend, or similar transaction), then
      a
      "Change in Control" shall be deemed to have occurred for purposes of this
      Paragraph 6(b).

     

    (c) Code.  “Code”
      shall mean the Internal Revenue Code of 1986, as amended.

     

    (d) Disability.  "Disability"
      shall mean the Executive's inability for a period of six consecutive months,
      to
      render substantially the services provided for in this Agreement by reason
      of
      mental or physical disability, whether resulting from illness, accident or
      otherwise, other than by reason of chronic or persistent abuse of any substance
      (such as narcotics or alcohol).

     

    (e) Good
      Reason.  "Good Reason" shall mean:

     

    (i) a
      material diminution in the Executive's title, duties or
      responsibilities;

     

    (ii) relocation
      of the Executive's place of employment without his consent outside the New
      York
      City metropolitan area;

     

     

    
      
         

      

      
        6

        
          

        

      

      
         

      

    

     

     

    (iii) the
      failure of MFA to pay within 30 business days any payment due from
      MFA;

     

    (iv) the
      failure of MFA to pay within a reasonable period after the date when amounts
      are
      required to be paid to the Executive under any benefit programs or plans;
      or

     

    (v) the
      failure by MFA to honor any of its material obligations herein.

     

    (f) Pre-Change-in-Control
      Event.  A "Pre-Change-in-Control Event" shall mean the
      occurrence of any one of the following events:

     

    (i) the
      Board
      shall adopt a resolution to the effect that any person has taken actions which,
      if consummated, would result in such person acquiring effective control of
      the
      business and affairs of MFA;

     

    (ii) there
      shall commence a tender offer or proxy contest resulting in any of the
      transactions specified in subparagraphs (i)-(iii) of
      Paragraph 6(b);

     

    (iii) MFA
      shall
      make any agreement resulting in any of the transactions specified in
      subparagraphs (i)-(iii) of Paragraph 6(b);

     

    (iv) there
      shall be a public announcement of a transaction of the kind specified in
      subparagraphs (i)-(iii) of Paragraph 6(b); or

     

    (v) any
      other
      meeting, writing or written communication with, by or to the Board of Directors
      or any officer or executive of MFA, that is held, made or undertaken in good
      faith in anticipation of a Change in Control.

     

    7. Covenant
      Not To
      Compete.

     

    In
      the
      event of the termination of the Executive's employment with MFA other than
      upon
      the nonrenewal of the Term of Employment, the Executive will not, without the
      prior written consent of MFA, manage, operate, control or be connected as a
      stockholder (other than as a holder of shares publicly traded on a stock
      exchange or the NASDAQ National Market System, provided that the Executive
      shall
      not own more than five percent of the outstanding shares of any publicly traded
      company) or partner with, or as an officer, director, employee or consultant
      of,
      any mortgage REIT for a period of one year following termination of his
      employment with MFA.  For a period of one year following the
      termination of the Executive's employment with MFA for any reason, the Executive
      shall not solicit any employees of MFA to work for any mortgage
      REIT.  Except as otherwise required by law, the Executive shall keep
      confidential all materials, files, reports, correspondence, records and other
      documents (collectively the "Company Materials")
      used, prepared or made available to him in connection with his employment by
      MFA
      and which have not otherwise been made available to the public, and upon
      termination of his employment shall return such Company Materials to
      MFA.  The Executive acknowledges that MFA may seek injunctive relief
      or other specific enforcement of its rights under this Paragraph.

     

    8. Indemnification.

     

    MFA
      shall
      indemnify the Executive to the fullest extent permitted by Maryland law as
      amended from time to time in connection with the Executive's duties with MFA,
      against all costs, expenses, liabilities and losses (including, without
      limitation, attorneys' fees, judgments, fines, penalties, ERISA excise taxes
      and
      amounts paid in settlement) actually and reasonably incurred by the Executive
      in
      connection with an action, suit or proceeding.  During the Term of
      Employment and for six years following the date of the Executive's termination
      as 

     

     

    
      
         

      

      
        7

        
          

        

      

      
         

      

    

     

     

    an
      officer of MFA, MFA (or any successor thereto) shall provide comprehensive
      coverage under its officers and directors insurance policy (or policies) on
      substantially the same terms and levels that it provides to its senior executive
      officers, at MFA's sole cost.

     

    9. Assignability;
      Binding
      Nature.

     

    This
      Agreement shall inure to the benefit of MFA and the Executive and their
      respective successors, heirs (in the case of the Executive) and
      assigns.  No rights or obligations of MFA under this Agreement may be
      assigned or transferred by MFA except that any such rights or obligations may
      be
      assigned or transferred pursuant to a merger or consolidation in which MFA
      is
      not the continuing entity, or the sale or liquidation of all or substantially
      all of the assets of MFA, provided that the assignee or transferee is the
      successor to all or substantially all of the assets of MFA and such assignee
      or
      transferee assumes the liabilities, obligations and duties of MFA, as contained
      in this Agreement, either contractually or as a matter of law.  This
      Agreement shall not be assignable by the Executive.

     

    10. Representation.

     

    MFA
      represents and warrants that it is fully authorized and empowered to enter
      into
      this Agreement and that its entering into this Agreement and the performance
      of
      its obligations under this Agreement will not violate any agreement between
      MFA
      and any other person, firm or organization or any law or governmental
      regulation.

     

    11. Entire
      Agreement.

     

    This
      Agreement contains the entire agreement between MFA and the Executive concerning
      the subject matter hereof and supersedes all prior agreements, understandings,
      discussions, negotiations and undertakings, whether written or oral, between
      them with respect thereto.

     

    12. Amendment
      or
      Waiver.

     

    This
      Agreement cannot be changed, modified or amended without the consent in writing
      of both the Executive and MFA.  No waiver by either MFA or the
      Executive at any time of any breach by the other party of any condition or
      provision of this Agreement shall be deemed a waiver of a similar or dissimilar
      condition or provision at the same or at any prior or subsequent
      time.  Any waiver must be in writing and signed by the Executive or an
      authorized officer of MFA, as the case may be.

     

    13. Severability.

     

    In
      the
      event that any provision or portion of this Agreement shall be determined to
      be
      invalid or unenforceable for any reason, in whole or in part, the remaining
      provisions of this Agreement shall be unaffected thereby and shall remain in
      full force and effect to the fullest extent permitted by law.

     

    14. Reasonableness.

     

    To
      the
      extent that any provision or portion of this Agreement is determined to be
      unenforceable by a court of law or equity, that provision or portion of this
      Agreement shall nevertheless be enforceable to the extent that such court
      determines is reasonable.

     

     

    
      
         

      

      
        8

        
          

        

      

      
         

      

    

     

     

    15. Survivorship.

     

    The
      respective rights and obligations of the parties hereunder shall survive any
      termination of this Agreement to the extent necessary to the intended
      preservation of such rights and obligations.

     

    16. Governing
      Law.

     

    This
      Agreement and all rights thereunder, and any controversies or disputes arising
      with respect thereto, shall be governed by and construed and interpreted in
      accordance with the laws of the State of New York, applicable to agreements
      made
      and to be performed entirely within such State, without regard to conflict
      of
      laws provisions thereof that would apply the law of any other
      jurisdiction.

     

    17. Dispute
      Resolution.

     

    In
      the
      event of any dispute, controversy or claim arising out of or relating to this
      Agreement or Executive's employment or termination thereof (other than a
      controversy or claim arising under Paragraph 7, to the extent necessary for
      MFA
      (or its affiliates, where applicable) to enforce the provisions thereof), the
      parties hereby agree to settle such dispute, controversy or claim in a binding
      arbitration by a single arbitrator in accordance with the Commercial Arbitration
      Rules of the American Arbitration Association, which arbitration shall be
      conducted in New York, New York.  The parties agree that the arbitral
      award shall be final and non-appealable and shall be the sole and exclusive
      remedy between the parties hereunder.  The parties agree that judgment
      on the arbitral award may be entered in any court having competent jurisdiction
      over the parties or their assets.  All reasonable fees and expenses
      related to any such arbitration (including reasonable attorneys' fees and
      related disbursements) shall be paid by MFA.

     

    18. Legal
      Fees.

     

    MFA
      shall
      pay directly all reasonable legal fees incurred by the Executive in connection
      with the negotiation, preparation and execution of this Agreement.

     

    19. Notices.

     

    Any
      notice given to either party shall be in writing and shall be deemed to have
      been given when delivered personally or sent by certified or registered mail,
      postage prepaid, return receipt requested, duly addressed to the party
      concerned, if to MFA, at its principal office, and if to the Executive, at
      the
      address of the Executive shown on MFA's records or at such other address as
      such
      party may give notice of.

     

    20. Headings.

     

    The
      headings of the paragraphs contained in this Agreement are for convenience
      only
      and shall not be deemed to control or affect the meaning or construction of
      any
      provision of this Agreement.

     

    21. Counterparts.

     

    This
      Agreement may be executed in two or more counterparts.

     


    
      
         

      

      
        9

        
          

        

      

      
         

      

    


    IN
      WITNESS WHEREOF, the undersigned have executed this Agreement as of the date
      first written above.

     

    
      
        	 	MFA
                Mortgage Investments, Inc.	 
	 	 	 	 
	 	 	 	 
	
                 

              	
                By:
                  

              	/s/ Stewart
                Zimmerman 	 
	 	Name: 	Stewart
                Zimmerman 	 
	 	Title: 	
                Chairman,
                  Chief Executive Officer and President 

              	 
	 	 	 	 


      

    

    
      
        	 	 	 	 
	
                 

              	
                By:
                  

              	/s/ Timothy
                W. Korth II 	 
	 	Name:  	Timothy
                W. Korth II 	 
	 	Title:  	
                General
                  Counsel, Senior Vice President-Business Development and Corporate
                  Secretary 

              	 
	 	 	 	 


      

    

    
    

    
    

     

    


    
      
        
           

        

        
          10

          
            

          

        

        
           

        

      

    

    


    EXHIBIT
      A

     

    Mutual
      Release

     

    This
      Mutual Release of Claims (this “Release”) is made
      as
      of _____________, by and between MFA MORTGAGE INVESTMENTS, INC. (the “Company”) and
      _________________ (the “Executive”).

     

    
      	
               

            	
              1.

            	
              Release
                by the
                Company. 

            


    

     

    (a)           
      The Company on behalf of itself, its agents, successors, affiliated entities
      and
      assigns, in consideration for the Executive’s execution and delivery of this
      Release, hereby forever releases and discharges the Executive, and his agents,
      heirs, successors, assigns, executors and administrators, from any and all
      known
      and unknown causes of action, actions, judgments, liens, indebtedness, damages,
      losses, claims, liabilities, and demands of whatsoever kind and character in
      any
      manner whatsoever arising on or prior to the date of this Release, including
      but
      not limited to (i) any claim for breach of contract, breach of implied
      covenant, breach of oral or written promise, defamation, interference with
      contract relations or prospective economic advantage, negligence,
      misrepresentation; (ii) any and all liability that was or may have been
      alleged against or imputed to the Executive by the Company or by anyone acting
      on its behalf; (iii) any punitive, compensatory or liquidated damages; and
      (iv) all rights to and claims for attorneys’ fees and costs except as
      otherwise provided in his employment agreement with the Company dated January
      1,
      2008 (the “Employment
      Agreement”).

     

    (b)           
      The Company shall not file or cause to be filed any action, suit, claim, charge
      or proceeding with any federal, state or local court or agency relating to
      any
      claim within the scope of this Release. In the event there is presently pending
      any action, suit, claim, charge or proceeding within the scope of this Release,
      or if such a proceeding is commenced in the future, the Company shall promptly
      withdraw it, with prejudice, to the extent it has the power to do so. The
      Company represents and warrants that its has not assigned any claim released
      herein, or authorized any other person to assert any claim on its behalf.

     

    (c)           
      Anything to the contrary notwithstanding in this Release or the Employment
      Agreement, this Release shall not apply to claims or damages based on (i) any
      right or claim that arises after the date on which the Company executes this
      Release, including any right to enforce the Employment Agreement with respect
      to
      provisions pertaining to matters that arise after the date of the Release and
      that survive termination of employment or (ii) any act of willful misconduct,
      gross negligence, fraud or misappropriation of funds.

     

    
      	
               

            	
              2.

            	
              Release
                by the
                Executive. 

            


    

     

    (a)           
      The Executive, on behalf of himself, his agents, heirs, successors, assigns,
      executors and administrators, in consideration for the termination payments
      and
      other consideration provided for under the Employment Agreement, hereby forever
      releases and discharges the Company, and its successors, its affiliated
      entities, and, in such capacities, its past and present directors, employees,
      agents, attorneys, accountants, representatives, plan fiduciaries, successors
      and assigns from any and all known and unknown causes of action, actions,
      judgments, liens, indebtedness, damages, losses, claims, liabilities, and
      demands of whatsoever kind and character in any manner whatsoever arising on
      or
      prior to the date of this Release, including but not limited to (i) any
      claim for breach of contract, breach of implied covenant, breach of oral or
      written promise, wrongful termination, intentional infliction of emotional
      distress, defamation, interference with contract relations or prospective
      economic advantage, negligence, misrepresentation or employment discrimination,
      and including without limitation alleged violations of Title VII of the
      Civil Rights Act of 1964, as amended, prohibiting discrimination based on race,
      color, religion, sex or national origin; the Family and Medical Leave Act;
      the


     

     

    
      
         

      

      
        11

        
          

        

      

      
         

      

    

     

     

    Americans
      With Disabilities Act; the Age Discrimination in Employment Act; other federal,
      state and local laws, ordinances and regulations; and any unemployment or
      workers’ compensation law, excepting only those obligations of the Company
      pursuant to Paragraph 5 of the Employment Agreement or otherwise continuing
      under the Employment Agreement and any claims to benefits under any compensation
      or benefit plan, program or arrangement in which the Executive was participating
      as of the date of termination of his employment; (ii) any and all liability
      that was or may have been alleged against or imputed to the Company by the
      Executive or by anyone acting on his behalf; (iii) all claims for wages,
      monetary or equitable relief, employment or reemployment with the Company in
      any
      position, and any punitive, compensatory or liquidated damages; and
      (iv) all rights to and claims for attorneys’ fees and costs except as
      otherwise provided in the Employment Agreement.

     

    (b)           
      The Executive shall not file or cause to be filed any action, suit, claim,
      charge or proceeding with any federal, state or local court or agency relating
      to any claim within the scope of this Release. In the event there is presently
      pending any action, suit, claim, charge or proceeding within the scope of this
      Release, or if such a proceeding is commenced in the future, the Executive
      shall
      promptly withdraw it, with prejudice, to the extent he has the power to do
      so.
      The Executive represents and warrants that he has not assigned any claim
      released herein, or authorized any other person to assert any claim on his
      behalf.

     

    (c)           
      In the event any action, suit, claim, charge or proceeding within the scope
      of
      this Release is brought by any government agency, putative class representative
      or other third party to vindicate any alleged rights of the Executive,
      (i) the Executive shall, except to the extent required or compelled by law,
      legal process or subpoena, refrain from participating, testifying or producing
      documents therein, and (ii) all damages, inclusive of attorneys’ fees, if
      any, required to be paid to the Executive by the Company as a consequence of
      such action, suit, claim, charge or proceeding shall be repaid to the Company
      by
      the Executive within ten (10) days of his receipt thereof.

     

    (d)           
      BY HIS SIGNATURE BELOW, THE EXECUTIVE ACKNOWLEDGES THAT:

     

    (1)           
      HE HAS RECEIVED A COPY OF THIS RELEASE AND WAS OFFERED A PERIOD OF TWENTY-ONE
      (21) DAYS TO REVIEW AND CONSIDER IT;

     

    (2)           
      IF HE SIGNS THIS RELEASE PRIOR TO THE EXPIRATION OF TWENTY-ONE DAYS, HE
      KNOWINGLY AND VOLUNTARILY WAIVES AND GIVES UP THIS RIGHT OF REVIEW;

     

    (3)           
      HE HAS THE RIGHT TO REVOKE THIS RELEASE FOR A PERIOD OF SEVEN (7) DAYS
      AFTER HE SIGNS IT BY MAILING OR DELIVERING A WRITTEN NOTICE OF REVOCATION TO
      THE
      COMPANY’S GENERAL COUNSEL, NO LATER THAN THE CLOSE OF BUSINESS ON THE SEVENTH
      DAY AFTER THE DAY ON WHICH HE SIGNED THIS RELEASE;

     

    (4)           
      THIS RELEASE SHALL NOT BECOME EFFECTIVE OR ENFORCEABLE UNTIL THE SEVEN DAY
      REVOCATION PERIOD HAS EXPIRED WITHOUT THE RELEASE HAVING BEEN REVOKED (THE
      “EFFECTIVE
      DATE”);

     

     

    
      
         

      

      
        12

        
          

        

      

      
         

      

    

     

     

    (5)           
      THIS RELEASE WILL BE FINAL AND BINDING AFTER THE EXPIRATION OF THE REVOCATION
      PERIOD REFERRED TO IN SECTION 2(d)(3).  HE AGREES NOT TO
      CHALLENGE ITS ENFORCEABILITY;

     

    (6)           
      HE IS AWARE OF HIS RIGHT TO CONSULT AN ATTORNEY, HAS BEEN ADVISED IN WRITING
      TO
      CONSULT WITH AN ATTORNEY, AND HAS HAD THE OPPORTUNITY TO CONSULT WITH AN
      ATTORNEY, IF DESIRED, PRIOR TO SIGNING THIS RELEASE;

     

    (7)           
      NO PROMISE OR INDUCEMENT FOR THIS RELEASE HAS BEEN MADE EXCEPT AS SET FORTH
      IN
      THIS RELEASE;

     

    (8)           
      HE IS LEGALLY COMPETENT TO EXECUTE THIS RELEASE AND ACCEPT FULL RESPONSIBILITY
      FOR IT; AND

     

    (9)           
      HE HAS CAREFULLY READ THIS RELEASE, ACKNOWLEDGES THAT HE HAS NOT RELIED ON
      ANY
      REPRESENTATION OR STATEMENT, WRITTEN OR ORAL, NOT SET FORTH IN THIS DOCUMENT,
      AND WARRANTS AND REPRESENTS THAT HE IS SIGNING THIS RELEASE KNOWINGLY AND
      VOLUNTARILY.

     


    
      
         

      

      
        13

        
          

        

      

      
         

      

    


    IN
      WITNESS WHEREOF, the parties have hereunto set their hands this _____ day of
      ___________________.

    
       

      
        
          	 	 	 	 
	 	 	 	 
	
                   

                	
                  By:
                    

                	 	 
	 	 	Name: 	 
	 	 	
                  Title: 

                	 
	 	 	 	 
	 	 	 	 


        

      

      
        
          	 	MFA
                  Mortgage Investments, Inc.	 
	 	 	 
	 	 	 
	
                   

                	
                  By:
                    

                	 	 
	 	 	Name: 	 
	 	 	
                  Title: 

                	 
	 	 	 	 


        

      

      
      

      
      

       

       

       

       

       

      
        14