Gary Kain
About Gary Kain
Gary D. Kain (age 59) is Executive Chair of AGNC’s Board (since July 2021), Director (since March 2016), former CEO (2016–2021), and former CIO (2009–2021). He previously held senior mortgage investment leadership roles at Freddie Mac (SVP Investments & Capital Markets, 2008–2009; SVP Mortgage Investments & Structuring, 2005–2008; various trading and portfolio strategy roles 1995–2005), bringing deep agency MBS trading, hedging, and portfolio risk expertise to AGNC . Under AGNC’s current performance framework, the company delivered a 13.2% annual economic return in 2024, and since its 2008 IPO has produced a 389% total stock return with $48.64/share in cumulative dividends, metrics used by the board to evaluate pay and strategy alignment .
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| AGNC Investment Corp. | Executive Chair; Director | Executive Chair since Jul 2021; Director since Mar 2016 | Strategic oversight; resource to CEO/CIO on investment strategy and risk management; chairs Board; serves on Executive Committee . |
| AGNC Investment Corp. | Chief Executive Officer; Chief Investment Officer; President | CEO 2016–Jul 2021; CIO 2009–Jul 2021; President 2011–2018 | Led agency MBS portfolio strategy, hedging, and capital allocation during major rate/volatility cycles . |
| Freddie Mac | SVP Investments & Capital Markets; SVP Mortgage Investments & Structuring; VP Mortgage Portfolio Strategy; Head Trader Securities Sales & Trading | 1995–2009 (various roles) | Managed mortgage investment activities, REMIC structuring/underwriting, and enterprise interest-rate hedging for a $700B retained portfolio . |
External Roles
- No current public company directorships disclosed in AGNC’s 2025 proxy biography for Mr. Kain .
Fixed Compensation
| Metric | 2023 | 2024 |
|---|---|---|
| Base Salary ($) | $500,000 | $500,000 |
| Target Annual Bonus ($) | $3,600,000 | $3,600,000 |
| Actual Annual Bonus Paid ($) | $5,119,200 | $5,742,000 |
Notes:
- Short-term bonus payout for 2024 was 159.5% of target under the Corporate Scorecard; for Kain, bonus is based solely on Corporate Scorecard results .
Performance Compensation
Annual Bonus Framework and 2024 Results
- Corporate Scorecard metrics and weights (2024): Absolute Annual Economic Return (25%), Relative Annual Economic Return vs Agency REIT peer group (35%), Relative Price-to-Tangible Book Ratio (15%), and Strategic/Operational Objectives (25%); payouts range 0–200% per metric .
- 2024 payout factors: Financial metrics 174.3% (13.2% absolute economic return; +13.4 pp relative economic return outperformance; +18.9 pp relative price-to-tangible book outperformance), Strategic/Operational 115%, total Scorecard payout 159.5% .
| Category | Weight | 2024 Payout | Weighted Payout |
|---|---|---|---|
| Financial Metrics | 75% | 174.3% | 130.7% |
| Strategic & Operational | 25% | 115.0% | 28.8% |
| Total Corporate Scorecard | — | — | 159.5% |
Long-Term Incentive (RSUs) – 2024 Grants (Granted 3/1/2024)
| Award Type | Grant Date | Shares/Units | Grant-Date Fair Value ($) |
|---|---|---|---|
| Time-Vesting RSUs | 3/1/2024 | 144,676 | $1,386,000 |
| Performance-Vesting RSUs (target/max) | 3/1/2024 | 293,736 / 587,472 | $2,814,000 (at 100% target) |
| Total 2024 LTI | 3/1/2024 | — | $4,200,000 |
Vesting and performance conditions
- Time-based RSUs vest ratably in three equal annual installments over a three-year-and-1/2-month period; the 2024 grant’s next vest date is March 15, 2025 .
- Performance RSUs cliff vest 2 years and 11.5 months post-grant subject to a 3-year performance period; payout range 0–200% .
- 2024 PRSU metrics (50%/50% weighting):
- Absolute Three-Year Economic Return: below-threshold <0.0%, threshold 0.0%, target 30.0%, outperformance ≥60.0% .
- Relative Three-Year Economic Return vs Agency REIT Peer Group: below-threshold <−4.5 pp, threshold −4.5 pp, target +3.0 pp, outperformance ≥+10.5 pp; relative measured vs unweighted average of ARR, DX, IVR, NLY, ORC, TWO .
Multi-year vesting outcomes (context)
- 2022 PRSUs (performance period ended 12/31/2024) vested at 75.5% of target based on −19.2% absolute economic return and +6.8 pp relative economic return outperformance over the applicable windows .
- 2024 vested equity realized: 405,035 shares vested for Kain, realizing $3,883,289 value in 2024 .
Summary Compensation (2019 program evolution + 3-year totals)
- Program evolution: AGNC emphasizes pay-for-performance and high LTI weighting; the Compensation Committee did not adjust 2024 target pay levels or mix year over year and received 92% Say-on-Pay support in 2024 .
- AGNC does not grant stock options; awards have been RSUs only under the 2016 Equity Plan .
| Year | Salary ($) | Bonus ($) | Stock Awards ($) | All Other ($) | Total ($) |
|---|---|---|---|---|---|
| 2022 | $500,000 | $2,228,400 | $4,200,000 | $18,300 | $6,946,700 |
| 2023 | $500,000 | $5,119,200 | $4,200,000 | $19,800 | $9,839,000 |
| 2024 | $500,000 | $5,742,000 | $4,200,000 | $20,700 | $10,462,700 |
Equity Ownership & Alignment
Ownership and guidelines
- Executive ownership guidelines: 6x base salary for Executive Chair; all NEOs in compliance as of Feb 21, 2025 .
- Anti-hedging and anti-pledging policy: directors and executive officers are prohibited from hedging, pledging, margin loans, shorts, and similar transactions in AGNC stock .
- Clawback: SEC/Nasdaq-compliant policy adopted Oct 2023 with a 3-year lookback for performance-based compensation upon a required accounting restatement .
Beneficial and plan-related holdings (as of Feb 21, 2025)
| Metric | Shares |
|---|---|
| Beneficially Owned | 1,745,943 (includes 517,920 in a family trust over which Mr. Kain has voting and dispositive power) |
| Unvested RSUs (net of tax) | 211,242 |
| Vested/Deferred Shares | 578,064 |
| Total (Ownership Guidelines calculation) | 2,535,249 |
| Shares Outstanding (context) | 915.5 million (as of Feb 21, 2025) |
| Beneficial Ownership % of Outstanding | ~0.19% (calculated: 1,745,943 / 915,500,000; based on and ) |
Outstanding unvested equity at 12/31/2024 (market value at $9.21/share)
- Unvested time-based RSUs and unearned performance RSUs had an aggregate (market/payout) value of $12,063,866 for Kain at year-end 2024; breakdown by grant year in filing .
Recent Form 4 activity (insider selling pressure/vesting)
- 2024-03-05: “A – Award” of 144,676 common stock units (time-based RSUs) to Kain (grant date 3/1/24) .
- 2024-03-18: “F – Payment of tax liability by withholding securities” of 58,959 shares at $9.63 on vesting; a non-open-market tax withholding transaction .
- 2024-01-17: “A – Award” reported for 242,598 shares (footnote details in Form 4) .
Note: These filings reflect equity awards and tax withholdings on vesting rather than discretionary open-market sales.
Employment Terms
Contract structure and restrictive covenants
- Employment agreement: For Kain, upon termination by the company without cause or by Kain for good reason (including following a change in control), he is entitled to a pro rata annual bonus and acceleration of any outstanding equity awards; no cash severance multiple applies to Kain (distinct from other NEOs) .
- Voluntary termination: accelerated vesting (pro rata for awards granted in the year of termination) and continued performance-vesting subject to restrictive covenant compliance; 90 days prior written notice required .
- Non-compete/non-solicit and confidentiality covenants apply post-employment; equity plan features double-trigger vesting acceleration on change of control if awards are not assumed or upon qualifying termination .
- Retirement vesting policy (effective Jan 1, 2026): provides vesting treatment for long-tenured employees who meet age/service thresholds; performance awards continue on original schedule .
Estimated payouts at hypothetical termination (as of 12/31/2024; $9.21/share)
| Scenario | Severance Multiple | Pro Rata Bonus ($) | Accelerated Equity ($) | Insurance ($) | Total ($) |
|---|---|---|---|---|---|
| Without Cause / Good Reason | None | 5,742,000 | 12,063,866 | — | 17,805,866 |
| Without Cause / Good Reason + Change in Control | None | 5,742,000 | 12,063,866 | — | 17,805,866 |
| Death or Disability | — | 5,742,000 | 12,063,866 | — | 17,805,866 |
| Voluntary (without Good Reason) | — | 5,742,000 (requires 90 days notice) | 12,063,866 | — | 17,805,866 |
Board Governance
- Role and independence: Kain is Executive Chair (non-independent officer-director); AGNC separates the Chair and CEO roles. Lead Independent Director (and Vice Chair) Prue Larocca provides robust independent leadership, including chairing meetings of independent directors; Audit and Compensation committees are fully independent .
- Board service history and committees: Kain has been a Director since 2016 and Executive Chair since 2021; he chairs Board meetings and serves on the Executive Committee; he is not on the Audit or Compensation & Corporate Governance Committees .
- Employee directors do not receive director fees; board cash/equity retainers apply only to independent directors .
- Say-on-Pay approval: 92% support at 2024 annual meeting; Compensation Committee retained 2023 scorecard and pay mix for 2024 after shareholder engagement .
- Related party transactions: none in 2024 .
Compensation Structure Analysis
- High at-risk pay: For NEOs, a substantial portion of total direct compensation is variable and equity-based; for the CEO, 48% of target TDC is LTI with 67% performance-based; the committee emphasizes three-year performance RSUs and maintains a low cash salary for Kain ($500k) .
- Metrics tied to shareholder value: Short-term bonuses hinge primarily on economic return (absolute and relative) and stock valuation premium vs peers; LTI pays on three-year absolute and relative economic return—central drivers of mortgage REIT value creation .
- Strong governance guardrails: No options or repricing, no tax gross-ups, robust clawback, strict anti-hedging/pledging, and double-trigger CoC treatment for equity .
- Peer context: Performance benchmarking uses an Agency REIT peer subset (ARR, DX, IVR, NLY, ORC, TWO) for relative metrics; compensation benchmarking is not tethered to a formal peer target percentile given AGNC’s unique profile .
Investment Implications
- Alignment and retention: Kain’s sizable unvested/performance equity ($12.1M at 12/31/24) and strict ownership/anti-pledging policies support alignment and reduce pledging/hedging risk; strong Say-on-Pay indicates investor acceptance of pay design .
- Incentives concentrate on economic return and valuation premium: 2024’s 159.5% bonus factor shows pay is sensitive to peer-relative outperformance and premium-to-book, aligning with core drivers of mortgage REIT TSR but also embedding exposure to market spread/volatility outcomes .
- Limited severance protections for the Executive Chair: Absence of cash severance multiples for Kain (pro rata bonus + equity acceleration only) reduces change-in-control entrenchment risk relative to typical peer constructs .
- Near-term flow considerations: Expect routine Form 4 “F” transactions around vest dates for tax withholding; recent filings in 2024 reflect awards and withholdings rather than open-market selling, suggesting limited discretionary selling pressure from Kain in the period reviewed .