Capstone Comments on Altisource Residential Corporation Announcement of Modification of Asset Management Contract

Capstone Equities Capital Management today commented on Altisource Residential Corporation's (RESI) announcement that it is rescheduling its earning conference call for the full year 2014, as it is "in the final stages of modifying its asset management agreement with Altisource Asset Management Corporation." By its letter dated February 27, 2015 (Full Demand Letter at www.capstonecm.com), Capstone demanded that the RESI Board of Directors terminate the AMA under section 11 for cause without paying a termination fee. Consistent with that demand, Capstone believes that any restructuring of the AMA should not involve a payment to AAMC of a termination fee. Capstone further believes that any restructured management fee should be at the median market rate equal to 1.5% of NAV, as detailed in the shareholder derivative lawsuit filed on behalf of RESI on January 15, 2015. Capstone believes the board of RESI has a fiduciary duty to negotiate the terms of the asset management agreement on an arm's length basis, which may require bringing in qualified experts as third parties to represent RESI and AAMC independently in these negotiations.