Item 1.01. Entry into a Material Definitive Agreement.

On September 21, 2012, Arlington Asset Investment Corp. (the "Company") entered into an underwriting agreement (the "Underwriting Agreement") with Barclays Capital Inc., as representative of the several underwriters named therein (the "Underwriters"), relating to the offer and sale of 3,000,000 shares of the Company's Class A common stock, par value $0.01 per share ("Class A Common Stock"), at a public offering price of $24.80 per share. In addition, the Company granted the Underwriters a 30-day option to purchase up to 450,000 additional shares of Class A Common Stock to cover over-allotments, if any (the "Option"). The Underwriters exercised the Option in full on September 21, 2012. Subject to customary closing conditions, closing of the offering of 3,450,000 shares of Class A Common Stock is expected to occur on September 26, 2012.

The Underwriting Agreement contains customary representations, warranties and covenants of the Company, indemnification rights and obligations of the parties and termination provisions. Pursuant to the Underwriting Agreement, the Company agreed to indemnify the Underwriters against certain specified types of liabilities, including liabilities under the Securities Act of 1933, as amended (the "Securities Act"), to contribute to payments the Underwriters may be required to make in respect of these liabilities and to reimburse the Underwriters for certain expenses. In the ordinary course of business the Underwriters or their affiliates may in the future engage in various financing, commercial banking and investment banking services with, and provide financial advisory services to, the Company and its affiliates for which they may receive customary fees and expenses.

The shares of Class A Common Stock will be issued pursuant to the Company's shelf registration statement on Form S-3 (File No. 333-171537) (the "Registration Statement"), which was declared effective by the Securities and Exchange Commission on January 20, 2011.

The foregoing description of the material terms of the Underwriting Agreement is qualified in its entirety by reference to the full text of the Underwriting Agreement, a copy of which is attached hereto as Exhibit 1.1 and incorporated herein by reference.

Item 9.01. Financial Statements and Exhibits.

A copy of the opinion of Hunton & Williams LLP with respect to the legality of the issuance and sale of Class A Common Stock in the offering is filed herewith, and thereby automatically incorporated by reference into the Registration Statement, in accordance with the requirements of Item 601(b)(5) of Regulation S-K under the Securities Act.

(d) Exhibits. The following exhibits are being filed herewith:

Exhibit
No. Description

1.1 Underwriting Agreement, dated as of September 21, 2012, between the Company and Barclays Capital Inc., as representative of the several underwriters named therein.

5.1 Opinion of Hunton & Williams LLP regarding legality of shares.

23.1 Consent of Hunton & Williams LLP (included in Exhibit 5.1).

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