NON-QUALIFIED STOCK OPTION AGREEMENTS

Stock Option Agreement

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CAPSTEAD MORTGAGE CORP

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Title: NON-QUALIFIED STOCK OPTION AGREEMENTS
Governing Law: Maryland Date: 8/1/2005
Industry: Real Estate Operations Sector: Services

NON-QUALIFIED STOCK OPTION AGREEMENTS, Parties: capstead mortgage corp

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CAPSTEAD MORTGAGE CORPORATION

INDEX TO EXHIBIT 10.4

NON-QUALIFIED STOCK OPTION AGREEMENTS:

<TABLE>

EXHIBIT NO. GRANTEE

----------- -------

<S> <C>

10.4(a) Michael W. Brown, Vice President - Asset and Liability

Management and Treasurer

10.4(b) Andrew F. Jacobs, President and Chief Executive Officer

10.4(c) Amar R. Patel, Senior Vice President - Asset and Liability

Management

10.4(d) Phillip A. Reinsch, Senior Vice President, Chief Financial

Officer and Secretary

10.4(e) Robert R. Spears, Jr., Senior Vice President - Asset and

Liability Management

10.4(f) Jack Biegler, Director

10.4(g) Gary Keiser, Director

10.4(h) Paul M. Low, Chairman of the Board

10.4(i) Christopher W. Mahowald, Director

10.4(j) Michael G. O'Neil, Director

10.4(k) Howard Rubin, Director

10.4(l) Mark S. Whiting, Director

</TABLE>

RESTRICTED STOCK AGREEMENTS:

<TABLE>

EXHIBIT NO. GRANTEE

----------- -------

<S> <C>

10.4(m) Michael W. Brown, Vice President - Asset and Liability

Management and Treasurer

10.4(n) Andrew F. Jacobs, President and Chief Executive Officer

10.4(o) Amar R. Patel, Senior Vice President - Asset and Liability

Management

10.4(p) Phillip A. Reinsch, Senior Vice President, Chief Financial

Officer and Secretary

10.4(q) Robert R. Spears, Jr., Senior Vice President - Asset and

Liability Management

10.4(r) Jack Biegler, Director

10.4(s) Gary Keiser, Director

10.4(t) Paul M. Low, Chairman of the Board

10.4(u) Christopher W. Mahowald, Director

10.4(v) Michael G. O'Neil, Director

10.4(w) Howard Rubin, Director

10.4(x) Mark S. Whiting, Director

</TABLE>

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EXHIBIT 10.4(a)

CAPSTEAD MORTGAGE CORPORATION

NONQUALIFIED STOCK OPTION AGREEMENT

FOR EMPLOYEES

THIS AGREEMENT, made as of this 13th day of May, 2005, (hereinafter called

the "Date of Grant") between Capstead Mortgage Corporation, a Maryland

corporation (hereinafter called the "Company"), and Michael W. Brown

(hereinafter called the "Optionee"):

R E C I T A L S:

The Company has adopted the 2004 Flexible Long-Term Incentive Plan (the

"Plan"), which Plan is incorporated herein by reference and made a part of this

Agreement. Capitalized terms not otherwise defined herein shall have the same

meanings as in the Plan.

The Company has determined that it is in the best interests of the Company

and its stockholders to grant the Optionee the option provided for in this

Agreement pursuant to the Plan on the terms set forth therein as an inducement

to enter into or remain in the employment of the Company or one of its

Affiliates, to enable the Optionee to participate in the long-term growth and

financial success of the Company and as an increased incentive to contribute to

the Company's future success and prosperity.

NOW THEREFORE, in consideration of the mutual covenants hereinafter set

forth, the parties hereto agree as follows:

1. Grant of the Option. The Company hereby grants to the Optionee the

right and option to purchase, on the terms and conditions hereinafter set forth,

30,000 Shares (the "Option"). The purchase price of the Shares subject to this

Option shall be $7.82 per Share (the "Exercise Price"). The Option is not

intended to be treated as an option that complies with Section 422 of the Code

or any successor provision thereto.

2. Option Term. The term of the Option shall begin immediately and

continue until the tenth anniversary of the Date of Grant, subject to earlier

termination as hereinafter provided.

(a) If the Optionee ceases to be an officer or employee of the Company or

any Affiliate by reason of the Optionee's discharge for cause, all rights of the

Optionee to exercise the Option shall terminate, lapse and be forfeited

immediately at the time of the Optionee's discharge for cause.

(b) If the Optionee ceases to be an employee of the Company or any

Affiliate by reason of death, the personal representatives, heirs, legatees or

distributees of the Optionee, as appropriate, shall have the right to exercise

the Option up to the earlier of (i) six months from the Optionee's death or (ii)

the remaining term of the Option.

Affiliate by reason of the Optionee's resignation, Retirement, Disability or for

any reason other than the

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Optionee's death or discharge for cause, all rights of the Optionee to exercise

the Option shall terminate, lapse, and be forfeited upon the earlier of (i) six

months after the date of the Optionee's termination of employment by reason of

such employee's resignation, Retirement, Disability or such other reason or (ii)

the remaining term of the Option, except that in case the Optionee shall die

within six months after the date of termination of employment by reason of such

employee's resignation, Retirement, Disability or such other reason, the

personal representatives, heirs, legatees or distributees of the Optionee, as

appropriate, shall have the right up to an additional three months from the date

of the Optionee's death to exercise the Option.

3. Vesting of Stock Options.

(a) The Options shall vest (become nonforfeitable) in accordance with the

schedule set forth below:

<TABLE>

Percentage of Shares Cumulative

Date Vested on Specified Date Percentage of Shares

------------- ------------------------ --------------------

May 13, 2006 25 25

May 13, 2007 25 50

May 13, 2008 25 75

May 13, 2009 25 100

</TABLE>

provided, however, that notwithstanding the foregoing schedule, and except as

otherwise provided below in paragraphs (b), (c), (d) or (e) below, no additional

Options shall vest after:

(i) termination of Optionee's employment with the Company or any

Affiliate for any reason (including voluntary and involuntary discharge,

Disability or Retirement), in which case the Optionee shall, at the time

of termination, forfeit all right, title and interest in and to any

Options not then vested;

(ii) an Optionee working full-time at the Date of Grant reduces

his/her scheduled hours worked per week below a standard 40-hour work

week, in which case the Optionee shall, at the time of such reduction and

subject to management's discretion, forfeit all right, title and interest

in and to any Options not then vested; or

(iii) an Optionee working part-time at the Date of Grant reduces

his/her scheduled hours worked per week below a standard 20-hour work

week, in which case the Optionee shall, at the time of such reduction and

subject to management's discretion, forfeit all right, title and interest

in and to any Options not then vested.

(b) If the Optionee ceases to be an employee of the Company or any

Affiliate by reason of death, the personal representatives heirs, legatees or

distributees of the Optionee, as appropriate, shall become fully vested in the

Option effective on the date of the Optionee's death and shall have the

immediate right to exercise the Option to the extent not previously exercised.

Option shall terminate as of a date to be fixed by the Board; provided, however,

that not less than 30 days'

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written notice of the date so fixed shall be given to the Optionee and the

Optionee shall be fully vested in and shall have the right during such period to

exercise the Option even though the Option would not otherwise be exercisable

under the Vesting Schedule. At the end of such period, any unexercised portion

of the Option shall terminate and be of no further effect.

(d) In the event of a Reorganization:

(1) If there is no plan or agreement respecting the Reorganization

or if such plan or agreement does not specifically provide for the change,

conversion or exchange of the Shares under the unexercised portion of the

Option for other securities, then the provisions of the above paragraph

liquidated on the effective date of the Reorganization; or

(2) If there is a plan or agreement respecting the Reorganization

and if such plan or agreement specifically provides for the change,

conversion or exchange of the Shares under the unexercised portion of the

Option for securities of another corporation, then the Board shall adjust

the Shares under the unexercised portion of the Option in a manner not

inconsistent with the provisions of such plan or agreement for the

adjustment, change, conversion or exchange of such Shares and the Option.

(e) In the event of a Change in Control of the Company, the Option shall

become fully vested and immediately exercisable.

4. Exercise of the Option.

(a) This Option may be exercised as to Shares only in amounts and at

intervals of time specified in this Agreement. Each exercise of the Option, or

any part thereof, shall be evidenced by a notice in writing to the Company. The

Exercise Price of the Shares as to which the Option shall be exercised shall be

paid in full at the time of exercise, and may be paid to the Company either:

(1) in cash (including check, bank draft or money order); or

(2) by the delivery of Shares having a Fair Market Value equal to

the aggregate Exercise Price; provided, however, that such Shares, if

acquired by the exercise of an Option shall have been owned by the

Optionee for more than six months prior to exercise; or

(3) by a combination of cash and Shares as described above; or

(4) by arrangement with a broker acceptable to the Committee in

which payment of the Exercise Price is made pursuant to an irrevocable

direction from the Optionee to the broker to deliver the Company proceeds

from the sale of the option Shares in an amount equal to the exercise

price of the Shares.

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(b) The amount, as determined by the Committee, of any federal, state or

local tax required to be withheld by the Company due to the exercise of the

Option granted hereunder shall be satisfied either (i) by payment by the

Optionee to the Company of the amount of such withholding obligation in cash or

(ii) through either the retention by the Company of a number of shares out of

the Shares being acquired through the exercise of the Option granted hereunder

or the delivery of already owned Shares having a Fair Market Value equal to the

amount of the withholding obligation. The cash payment or the amount equal to

the Fair Market Value of the Shares so withheld, as the case may be, shall be

remitted by the Company to the appropriate taxing authorities.

Company with respect to the Shares covered by this Agreement except to the

extent that one or more certificates of such Shares shall have been delivered to

the Optionee, or the Optionee has been determined to be a stockholder of record

by the Company's Transfer Agent, upon due exercise of the Option granted

hereunder.

5. No Right to Continued Employment. This Agreement shall not confer on

the Optionee any right to continue serving as an employee of the Company nor

shall this Agreement limit in any way the Company's right to terminate or change

the terms of the Optionee's employment.

6. Adjustments Upon Changes in Capitalization or Reorganization. The

number of Shares subject to the Option shall be adjusted from time to time as

follows:

(a) Subject to any required action by stockholders, the number of Shares

subject to the option granted hereunder, and the Exercise Price, shall be

proportionately adjusted for any increase or decrease in the number of issued

Shares of the Company resulting from a subdivision or consolidation of Shares or

the payment of a stock dividend (but only in Shares) or any other increase or

decrease in the number of Shares effected without receipt of consideration by

the Company.

(b) Subject to any required action by stockholders, if the Company shall

be the surviving corporation in any Reorganization, merger or consolidation, the

Option granted hereunder shall pertain to and apply to the securities to which a

holder of the number of Shares subject to the Option granted hereunder would

have been entitled, and if a plan or agreement reflecting any such event is in

effect that specifically provides for the change, conversion or exchange of

Shares, then any adjustment to Shares subject to the Option granted hereunder

shall not be inconsistent with the terms of any such plan or agreement.

constituted, which is limited to a change of par value into the same number of

Shares with a different par value or without par value, the Shares resulting

from any such change shall be deemed to be the Shares within the meaning of the

Plan.

To the extent that the foregoing adjustments relate to stock or securities

of the Company, such adjustments shall be made by the Board, whose determination

shall be final, binding and conclusive.

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Except as otherwise specifically provided in this Agreement, the Optionee

shall have no rights by reason of any subdivision or consolidation of stock of

any class or the payment of any stock dividend or any other increase or decrease

in the number of shares of stock of any class or by reason of any dissolution,

liquidation, reorganization, merger or consolidation or spin-off of assets or

stock of another corporation, and any issued by the Company of shares of stock

of any class, or securities convertible into shares of stock of any class, shall

not affect, and no adjustment by reason thereof shall be made with respect to,

the number or Exercise Price of Shares subject to the Option granted hereunder.

7. Non-Transferability of the Option. This Agreement, and the Option

granted hereunder, shall not be transferable otherwise than by will or the laws

of descent and distribution and may be exercised, during the lifetime of the

Optionee, only by the Optionee; provided, however, that this Agreement, and the

Option granted hereunder, may be transferred to one or more members of the

immediate family of the Optionee or to a trust for the benefit of such person or

as directed under a qualified domestic relations order. Any attempted

assignment, transfer, pledge, hypothecation or other disposition of this

Agreement and the Option granted hereunder contrary to the provisions hereof, or

the levy of any execution, attachment or similar process upon this Agreement,

and the Option granted hereunder, shall be null and void and without effect.

8. Compliance with Securities and other Laws. In no event shall the

Company be required to issue Shares under the Option granted hereunder, if the

issuance thereof would constitute a violation of applicable federal or state

securities laws or regulations or a violation of any other law or regulation of

any governmental or regulatory agency or authority or any national securities

exchange. As a condition to any issuance of Shares, the Company may place

legends on shares, issue stop transfer orders and require such agreements or

undertakings as the Company may deem necessary or advisable to assure compliance

with any such laws or regulations, including, if the Company or its counsel

deems it appropriate, representations from the Optionee that the Optionee is

acquiring the Shares solely for investment and not with a view to distribution

and that no distribution of the Shares will be made unless such shares are

registered pursuant to applicable federal and state securities laws, or in the

opinion of counsel of the Company, such registration is unnecessary.

9. Issuance of Shares. Upon the Company's determination that the Option

granted hereunder has been validly exercised as to any of the Shares, the

Committee shall, at its sole discretion, cause the Secretary of the Company to

issue certificates in the Optionee's name for such Shares. The Company shall not

be liable to the Optionee for damages relating to any delays in issuing the

certificates, if any, to the Optionee, any loss of the certificates, or any

mistakes or errors in the issuance of the certificates or in the certificates

themselves.

10. Alternative Award for Cancellation of the Option. For purposes of this

Agreement, the payment to the Optionee of an alternative award or an amount in

cash pursuant to the terms of Section 16 of the Plan in consideration of the

cancellation of the Option granted hereunder shall extinguish any rights of the

Optionee in connection with this Agreement.

11. Notices. Any notice necessary under this Agreement shall be in

writing, signed by the party giving or making the same, and addressed (a) to the

Company in the care of its

<PAGE>

President or Secretary at the principal executive office of the Company in

Dallas, Texas, (b) to the Optionee at the address appearing in the personnel

records of the Company for such Optionee or (c) to either party at such other

address as either party hereto may hereafter designate in writing to the other.

Except as otherwise provided herein, any such notice shall be deemed effective

upon receipt thereof by the addressee.

12. Choice of Law. THE INTERPRETATION, PERFORMANCE AND ENFORCEMENT OF THIS

AGREEMENT SHALL BE GOVERNED BY THE LAWS OF THE STATE OF MARYLAND.

13. Option Subject to Plan. The Option is subject to the Plan. The terms

and provisions of the Plan as it may be amended from time to time are hereby

incorporated herein by reference. In the event of a conflict between any term or

provision contained herein and a term or provision of the Plan, the applicable

terms and provisions of the Plan will govern and prevail.

14. Amendment of Agreement. This Agreement may be amended, altered,

suspended, discontinued or terminated by the Committee; provided that no such

amendment, alteration, suspension or termination shall materially impair the

rights of the Optionee hereunder without the consent of the Optionee.

15. Administration of Plan and Agreement. Any determinations or decisions

made or actions taken arising out of or in connection with the interpretation

and administration of the Plan and this Agreement by the Committee shall be

final and conclusive.

16. Execution in Counterparts. This Agreement may be executed in

counterparts, each of which shall be deemed an original for all purposes and

both of which taken together shall constitute but one and the same instrument.

[Signature Page Follows]

<PAGE>

IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of

the Date of Grant. By execution of this Agreement the Optionee acknowledges

receipt of a copy of the Plan, the Company's Annual Report on Form 10-K for the

year ended December 31, 2004 and the informational supplement required by Rule

428(b)(1) under the Securities Act of 1933.

CAPSTEAD MORTGAGE CORPORATION

By: /s/ ANDREW F. JACOBS

---------------------------------------

Andrew F. Jacobs

President and Chief Executive Officer

[OPTIONEE]

/s/ MICHAEL W. BROWN

-------------------------------------------

Michael W. Brown

<PAGE>

EXHIBIT 10.4(b)

CAPSTEAD MORTGAGE CORPORATION

NONQUALIFIED STOCK OPTION AGREEMENT

FOR EMPLOYEES

THIS AGREEMENT, made as of this 13th day of May, 2005, (hereinafter called

the "Date of Grant") between Capstead Mortgage Corporation, a Maryland

corporation (hereinafter called the "Company"), and Andrew F. Jacobs

(hereinafter called the "Optionee"):

R E C I T A L S:

The Company has adopted the 2004 Flexible Long-Term Incentive Plan (the

"Plan"), which Plan is incorporated herein by reference and made a part of this

Agreement. Capitalized terms not otherwise defined herein shall have the same

meanings as in the Plan.

The Company has determined that it is in the best interests of the Company

and its stockholders to grant the Optionee the option provided for in this

Agreement pursuant to the Plan on the terms set forth therein as an inducement

to enter into or remain in the employment of the Company or one of its

Affiliates, to enable the Optionee to participate in the long-term growth and

financial success of the Company and as an increased incentive to contribute to

the Company's future success and prosperity.

NOW THEREFORE, in consideration of the mutual covenants hereinafter set

forth, the parties hereto agree as follows:

1. Grant of the Option. The Company hereby grants to the Optionee the

right and option to purchase, on the terms and conditions hereinafter set forth,

100,000 Shares (the "Option"). The purchase price of the Shares subject to this