ARLINGTON ASSET INVESTMENT CORP. (NYSE:AI) Files An 8-K Entry into a Material Definitive Agreement

Item1.01.

On May5, 2017, Arlington Asset Investment Corp. (the Company)
entered into an underwriting agreement (the Underwriting
Agreement) with JonesTrading Institutional Services LLC (the
Underwriter), relating to the offer and sale of 135,000 shares of
the Companys 7.00% Series B Cumulative Perpetual Redeemable
Preferred Stock, $0.01 par value per share (the Series B
Preferred Stock), at a public offering price of $24.00 per share.
Closing of the offering of 135,000 shares of Series B Preferred
Stock is expected to occur on May12, 2017, subject to customary
closing conditions.

The Underwriting Agreement contains customary representations,
warranties and covenants of the Company, indemnification rights
and obligations of the parties and termination provisions. to
agreements entered into with the Company, the underwriters may be
entitled to indemnification by the Company against certain civil
liabilities, including liabilities under the Securities Act of
1933, as amended (the Securities Act), or to contribution for
payments the Underwriter may be required to make. In the ordinary
course of business the Underwriter or its affiliates may in the
future engage in investment banking, asset management or
financial advisory services to the Company and its affiliates for
which they may receive customary fees and expenses.

The shares of Series B Preferred Stock will be issued to the
Companys Registration Statement on FormS-3 (File No.333-215384)
(the Registration Statement), which was declared effective on
February17, 2017.

The foregoing description of the Underwriting Agreement is not
complete and is qualified in its entirety by reference to the
entire Underwriting Agreement, a copy of which is attached hereto
as Exhibit 1.1, and incorporated herein by reference.

On May9, 2017, the Company filed, with the State Corporation
Commission of the Commonwealth of Virginia, Articles of Amendment
(the Articles of Amendment) to the Amended and Restated Articles
of Incorporation of the Company classifying and designating
2,000,000 shares of the Companys authorized preferred stock, par
value $0.01 per share, as the Series B Preferred Stock, with the
powers, designations, preferences and other rights as set forth
therein.

The Articles of Amendment, among other things, provide that the
Company will pay cumulative cash dividends on the Series B
Preferred Stock when and as declared by the Companys Board of
Directors from, and including, May12, 2017, at a rate of 7.00%
per annum of the $25.00 liquidation preference per share
(equivalent to the fixed annual rate of $1.75 per share).
Dividends on the SeriesB Preferred Stock will be payable
quarterly in arrears on the 30th day of each December, March,
June and September, when and as declared, beginning on June30,
2017 (provided that if any dividend payment date is not a
business day, then the dividend which would otherwise have been
payable on that dividend payment date may be paid on the next
succeeding business day).

The Series B Preferred Stock ranks senior to the Companys common
stock, $0.01 par value per share (Common Stock), with respect to
the payment of dividends and rights upon the voluntary or
involuntary liquidation, dissolution or winding up of the
Company.

The Series B Preferred Stock will not be redeemable before May12,
2022 except upon the occurrence of a Change of Control (as
defined in the Articles of Amendment). On or after May12, 2022,
the Company may, at its option, redeem, in whole or in part, at
any time or from time to time, the Series B Preferred Stock at a
redemption price of $25.00 per share, plus any accumulated and
unpaid dividends thereon (whether or not authorized or declared)
to, but excluding, the redemption date. In addition, upon the
occurrence of a Change of Control, the Company will redeem all of
the shares of Series B Preferred Stock, in whole but not in part,
on the effective date of any such Change of Control at $25.00 per
share plus any accumulated and unpaid dividends to, but
excluding, the redemption date. The Series B Preferred Stock has
no stated maturity, is not subject to any sinking fund or
mandatory redemption and will remain outstanding indefinitely
unless repurchased or redeemed by the Company.

The Series B Preferred Stock is not convertible into or
exchangeable for any other property or securities of the Company.

2

Holders of Series B Preferred Stock generally have no voting
rights, but have limited voting rights if the Company fails to
pay dividends for six or more full quarterly dividend periods
(whether or not consecutive) and under certain other
circumstances.

A copy of the Articles of Amendment and Form of Series B
Preferred Stock Certificate are filed or incorporated herein by
reference as Exhibits 3.1 and 4.1, respectively, to this Current
Report on Form 8-K and incorporated herein by reference. The
description of the terms of the Articles of Amendment in this
Item3.03 is qualified in its entirety by reference to Exhibit
3.1.

3

About ARLINGTON ASSET INVESTMENT CORP. (NYSE:AI)

Arlington Asset Investment Corp. is a principal investment firm. The Company acquires and holds a levered portfolio of residential mortgage-backed securities (MBS), consisting of agency MBS and private-label MBS. The Company may invest in other types of residential mortgage assets, such as residential mortgage loans, mortgage servicing rights and government sponsored enterprise (GSE) credit risk transfer securities, as well as other types of assets, including commercial MBS, asset backed securities, other structured securities, commercial mortgage loans, commercial loans, and other real estate-related loans and securities. The Company’s Agency MBS include residential mortgage pass-through certificates for which the principal and interest payments are guaranteed by a United States Government agency or GSE, such as the Federal National Mortgage Association and the Federal Home Loan Mortgage Corporation. Its subsidiary is Rosslyn REIT Trust, which is a real estate investment trust.

ARLINGTON ASSET INVESTMENT CORP. (NYSE:AI) Recent Trading Information

ARLINGTON ASSET INVESTMENT CORP. (NYSE:AI) closed its last trading session down -0.01 at 14.22 with 329,937 shares trading hands.