THIS EMPLOYMENT AGREEMENT (the “Agreement”) is entered into as of April 19, 2006 (the “Effective Date”), by and
between AMERICAN CAPITAL STRATEGIES, LTD., a Delaware corporation (the “Company”), and Brian Graff (the
W I T N E S S E T H:
WHEREAS , the Executive is a Senior Vice President and Regional Managing Director of the Company and a member of
the Company’s Investment Committee (the “IC”); and
WHEREAS , it is in the interests of the Company that the Executive’s service continue to be available to the Company.
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:
Definitions and Interpretations
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:
“Base Salary” shall have the meaning specified in Section 3.1.
“Board of Directors” shall mean the Board of Directors of the Company.
“Change of Control” shall means 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 25% 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