EXHIBIT 10(c)(3)

EXECUTION COPY

FIFTH OMNIBUS AMENDMENT

This FIFTH OMNIBUS AMENDMENT, dated as of March 27, 2007 (as amended, modified,
waived, supplemented or restated from time to time, this “Amendment”), is by and
among:

(1) U.S. BANK NATIONAL ASSOCIATION, a national banking association (together
with its successors and assigns “U.S. Bank”), not in its individual capacity,
but solely as Custodian (in such capacity, the “Custodian”) and as indenture
trustee (in such capacity, the “Indenture Trustee”) under the Indenture (as
defined below);

(2) CITIGROUP GLOBAL MARKETS REALTY CORP., a Delaware corporation (together with
its successors and assigns, “Citigroup”), as note purchaser (in such capacity,
the “Note Purchaser”) under the Note Purchaser Agreement (as defined below);

(3) NEWSTAR WAREHOUSE FUNDING 2005 LLC, a Delaware limited liability company
(together with its successors and assigns, "NewStar LLC"), as issuer (in such
capacity, the “Issuer”) under the Indenture (as defined below) and as purchaser
(in such capacity, the “Purchaser”) under the Sale and Servicing Agreement (as
defined below);

(4) NEWSTAR FINANCIAL, INC., a Delaware corporation (together with its
successors and assigns, "NewStar Financial"), as seller (in such capacity,
"Seller") and as servicer (in such capacity, "Servicer") under the Sale and
Servicing Agreement (as defined below); and

(5) LYON FINANCIAL SERVICES, INC., d/b/a U.S. Bank Portfolio Services (together
with its successors and assigns, "USBPS"), as backup servicer (in such capacity,
"Backup Servicer").

INTRODUCTORY STATEMENT

NewStar Financial, as Seller and as Servicer, NewStar LLC, as Purchaser, and
USBPS, as Backup Servicer, have entered into the Sale and Servicing Agreement,
dated as of December 30, 2005 (as heretofore amended, restated, supplemented or
otherwise modified from time to time, the “Sale and Servicing Agreement”).

NewStar LLC, as Issuer, and U.S. Bank, as Indenture Trustee and as Custodian,
have entered into the Indenture, dated as of December 30, 2005 (as heretofore
amended, restated, supplemented or otherwise modified from time to time, the
“Indenture”).

NewStar LLC, as Issuer, NewStar Financial, as Seller and Servicer, and
Citigroup, as Note Purchaser, have entered into the Note Purchase Agreement,
dated as of December 30, 2005 (the “Original Note Purchase Agreement” and,
together with the Sale and Servicing Agreement and the Indenture, the "Original
Basic Documents"),

Pursuant to the Indenture, NewStar LLC, as Issuer, has issued a Note to the Note
Purchaser with an aggregate initial principal amount of up to $300,000,000 (the
“Original Note”).

In April of 2006, the parties entered into a First Omnibus Amendment amending
Appendix A to each of the Original Basic Documents (the “First Omnibus
Amendment”). In June of 2006, the parties (i) entered into a Second Omnibus
Amendment further amending Appendix A to each of the Original Basic

 

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Documents (the “Second Omnibus Amendment”). In December of 2006, the parties
entered into a Third Omnibus Amendment amending certain of the Basic Documents
(including Appendix A to each of the Basic Documents) (the “Third Omnibus
Amendment”) and (ii) amended and restated the Original Note Purchase Agreement
pursuant to the Amended and Restated Note Purchase Agreement, dated as of
December 22, 2006 (the “Note Purchase Agreement” and, together with the Sale and
Servicing Agreement and the Indenture, the “Basic Documents”), among each of the
parties to the Original Note Purchase Agreement. Concurrently with the execution
and delivery of the Third Omnibus Amendment, NewStar LLC also executed and
delivered a Continuing Agreement for Letters of Credit in favor of Citibank,
N.A. (the “Reimbursement Agreement”). In February of 2007, the parties entered
into a Fourth Omnibus Amendment, amending Appendix A to each of the Basic
Documents and Schedule 2 to the Servicing Agreement (the “Fourth Omnibus
Amendment”).

Concurrently with the execution and delivery of this Amendment, the Issuer is
executing and delivering the Amended and Restated Note, dated as of the date
hereof (the "Amended and Restated Note" and the Original Note, as so amended and
restated, the "Note"), with a maximum aggregate principal amount of
$400,000,000, against delivery and cancellation of the Original Note; the
parties now wish to amend the Indenture, the Note Purchase Agreement and the
Sale and Servicing Agreement in the manner set forth herein, and to adopt the
Usage and Definitions attached hereto as Exhibit A as heretofore amended,
restated, supplemented or otherwise modified from time to time, (the
“Definitions Appendix”) as the definitions appendix that is to be applicable to
each of the Basic Documents. The parties also wish that the Issuer shall make a
confirmatory grant to the Indenture Trustee of the security interest in the
Collateral, reflecting certain additional secured obligations.

The parties hereto agree as follows:

Section 1. Definitions. Unless otherwise defined herein, all defined terms that
are defined in the Sale and Servicing Agreement (as amended by this Amendment)
or, if not therein defined, in the Amended and Restated Note Purchase Agreement
or, if not therein defined, in the Indenture (as amended by this Amendment)
(including, in each case, the Definitions Appendix as amended by this
Amendment), shall have the same meanings when used herein.

Section 2. Amendments to Definitions Appendix. Appendix A to each of the Basic
Documents, is hereby amended as follows:

(a) The definition of "Note Interest Rate" is hereby amended by replacing 0.70%
in clause (a)(i) with 0.60%.

(b) The definition of "Note Purchase Obligation Limit" is hereby amended by
replacing "$300,000,000" with "$400,000,000."

(c) Clause (a) of the definition of "Excess Concentration Amount" is hereby
amended to read in its entirety as follows:

"(a) the total Outstanding Funded Principal Balance of Eligible Assets that
relate to any one Obligor (including any Affiliates thereof) exceeds
$40,000,000; provided, however, that (i) the Outstanding Funded Principal
Balance of Eligible Assets that relate to one Obligor may be up to $60,000,000
without resulting in an Excess Concentration Amount with respect thereto (except
that this proviso shall be deemed to apply only for a period not exceeding
forty-five (45) days with respect to any Obligor, following which an Excess
Concentration Amount shall

 

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result if such total Outstanding Funded Principal Balance exceeds $40,000,000)
and (ii) the Note Purchaser may from time to time by written waiver cause any of
the dollar amounts specified in this clause (a) to be increased to designated
levels with respect to any one or more designated Obligors, the effect of each
such waiver to be subject to any limitations and conditions as may be set forth
therein (the effectiveness of any waiver pursuant to this clause (ii) being
conditioned upon delivery of a copy thereof, or summary of the substance
thereof, to the Indenture Trustee and the Backup Servicer);"

(d) Clause (d) of the definition of "Excess Concentration Amount" is hereby
deleted in its entirety and replaced with the following:

"(d)(1) the total Outstanding Funded Principal Balance of the Eligible Assets
relating to Borrowers or other Obligors which are predominantly located in any
one State (other than the State of California) exceeds the greater of
(i) $30,000,000 and (ii) 20% of the Eligible Funded Asset Amount;

(d)(2) the total Outstanding Funded Principal Balance of the Eligible Assets
relating to Borrowers or other Obligors which are not predominantly located in
any one State exceeds the greater of (i) $30,000,000 and (ii) 30% of the
Eligible Funded Asset Amount;"

(e) Clause (e) of the definition of "Excess Concentration Amount" is hereby
deleted in its entirety and replaced with the following:

"(e) the total Outstanding Funded Principal Balance of the Eligible Assets
relating to Borrowers or other Obligors which are predominately located in the
State of California exceeds the greater of (i) $30,000,000 and (ii) 30% of the
Eligible Funded Asset Amount;"

Section 3. Amendments to Sale and Servicing Agreement.

(a) Section 2.7(c) of the Sale and Servicing Agreement is hereby amended by
replacing "December 30, 2008" with "December 30, 2009."

Section 4. Confirmatory Grant of Security Interest.

(a) Issuer hereby Grants to Indenture Trustee, as Indenture Trustee for the
benefit of the Secured Parties, all of Issuer's right, title and interest in, to
and under, whether now owned or existing or hereafter acquired or arising in,
the Collateral. The Grant of the Collateral includes all rights, powers and
options (but none of the obligations) of Issuer under the Collateral, including
the immediate and continuing right to claim for, collect, receive and give
receipt for principal and interest payments in respect of the Collateral and all
other monies payable under the Collateral, to give and receive notices and other
communications, to make waivers or other agreements, to exercise all rights and
options, to bring Proceedings in the name of Issuer or otherwise, and generally
to do and receive anything that Issuer is or may be entitled to do or receive
under the Collateral or with respect to the Collateral.

 

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(b) The foregoing Grant is made in trust to secure (a) the payment of principal
of and interest on, and any other amounts owing in respect of, the Notes
(including, without limitation, the Amended and Restated Note), (b) payment of
amounts payable to the Hedge Counterparties under the Interest Rate Hedges (if
any), (c) payment of amounts payable to Note Purchaser pursuant to the Note
Purchase Agreement (including the Unused Fee Amount), (d) payment of amounts
payable to the Issuing Bank under the Reimbursement Agreement, including all
reimbursement obligations with respect to Letters of Credit and all L/C Fee
Amounts, together with accrued interest on all of the foregoing, and
(e) compliance by Issuer with the provisions of the Indenture, the Reimbursement
Agreement, the other Basic Documents and the Interest Rate Hedges (if any) for
the benefit of the Secured Parties.

(c) Indenture Trustee acknowledges such Grant, accepts the trusts under the
Indenture and agrees to perform the duties required in the Indenture so that the
interests of the Secured Parties may be adequately and effectively protected.
The Indenture Trustee acknowledges the rights and obligations of the Servicer
with respect to the servicing of the Collateral pursuant to the Sale and
Servicing Agreement.

(d) Issuer hereby authorizes Indenture Trustee and Skadden, Arps, Slate,
Meagher & Flom LLP to file a Record or Records (as such term is defined in the
applicable UCC), including financing statements or continuation statements, and
amendments thereto, in all jurisdictions and with all filing offices as are
necessary or advisable to perfect, and continue the perfection of, the security
interest Granted to Indenture Trustee under the Indenture (as amended by this
Amendment); provided, that Indenture Trustee will have no obligation to make any
such filings. Such financing statements may describe the Collateral in any
manner necessary, advisable or prudent to ensure the perfection of the security
interest Granted to Indenture Trustee under this Indenture, including "all
assets," "all personal property" or words to similar effect; provided, that
Indenture Trustee will have no obligation to make any such determination.

Section 5. "Representations and Warranties of NewStar LLC and NewStar Financial.
Each of NewStar LLC and NewStar Financial represents and warrants (which
representations and warranties shall survive the execution and delivery hereof)
to the Note Purchaser, the Indenture Trustee, the Issuing Bank, the Custodian
and the Backup Servicer that:

(a) it has the corporate power and authority to execute, deliver and carry out
the terms and provisions of this Amendment and has taken or caused to be taken
all necessary corporate action to authorize the execution, delivery and
performance of this Amendment;

(b) no consent of any person and no action of, or filing with any governmental
or public body or authority is required to authorize, or is otherwise required
in connection with the execution, delivery and performance of this Amendment
which has not been obtained;

(c) this Amendment has been duly executed and delivered by a duly authorized
officer on behalf of such party, and constitutes a legal, valid and binding
obligation of such party enforceable against such party in accordance with its
terms, subject to bankruptcy, reorganization, insolvency, moratorium and other
similar laws affecting the enforcement of creditors’ rights generally and the
exercise of judicial discretion in accordance with general principles of equity;

(d) the execution, delivery and performance of this Amendment will not violate
any law, statute or regulation, or any order or decree of any court or
governmental instrumentality, or conflict with, or result in the breach of, or
constitute a default under any contractual obligation of such party;

 

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(e) after giving effect to this Amendment, no Event of Default or event which
upon notice or lapse of time or both would constitute an Event of Default (as
defined in the Indenture or any other Basic Document) has occurred and is
continuing; and

(f) on the date hereof, the representations and warranties set forth in
Section 3.1 and Section 3.2 of the Sale and Servicing Agreement, and the
representations and warranties set forth in Section 5.01 and Section 5.02 of the
Note Purchase Agreement, are and will be true, correct and complete with the
same effect as if made on the date hereof, except to the extent such
representations and warranties expressly relate to an earlier date, in which
case, as of such earlier date.

Section 6. Conditions to Effectiveness. This Amendment shall become effective as
of the date above written, if, and only if:

(a) each of the Note Purchaser, the Indenture Trustee, the Custodian and the
Backup Servicer shall have received counterparts of this Amendment duly executed
by NewStar LLC and NewStar Financial (in all of their respective capacities set
forth herein);

(b) all representations and warranties contained in this Amendment or otherwise
made in writing to the Note Purchaser, the Indenture Trustee, the Custodian
and/or the Backup Servicer in connection herewith shall be true and correct in
all material respects;

(c) the Amended and Restated Note has been duly, executed and delivered by the
Issuer;

(d) such other information, materials and documentation as the Note Purchaser,
the Indenture Trustee, the Custodian and/or the Backup Servicer, and/or their
respective counsel, may reasonably request, which information, materials and
documentation shall be satisfactory in form and substance to such Person, as the
case may be, and its counsel; and

(e) all legal matters incident to the effectiveness of this Amendment shall be
satisfactory to the Note Purchaser, the Indenture Trustee, the Custodian and/or
the Backup Servicer and their respective counsel.

Section 7. Confirmation and Acknowledgement of the Obligations. NewStar LLC
hereby (i) confirms and acknowledges to the Note Purchaser that it is validly
and justly indebted to the Note Purchaser, any other Noteholders and any other
Persons party to the Basic Documents, as applicable, for the payment of all
obligations due under the Basic Documents without offset, defense, cause of
action or counterclaim of any kind or nature whatsoever and (ii) reaffirms and
admits the validity and enforceability of the Indenture, the Note and the other
Basic Documents. NewStar Financial hereby confirms and acknowledges its
obligations under the Basic Document and confirms that they will remain in
effect following the execution and delivery of this Amendment.

Section 8. Ratification of Basic Documents. This Amendment shall be limited
precisely as written and shall not be deemed (i) to be a consent granted
pursuant to, or a waiver or modification of, any other term or condition of the
Note or the Basic Documents or a waiver of any Event of Default under the Note,
the Indenture or the other Basic Documents, whether or not known to the Note
Purchaser, any other Noteholder or the Indenture Trustee or (ii) to prejudice
any other right or rights which the Note Purchaser, any other Noteholder or the
Indenture Trustee may now have or have in the future under or in connection with
the Note or the Basic Documents or any of the instruments or agreements referred
to therein. Except to the extent hereby modified, the Note and each of the Basic
Documents shall continue in full force and effect in accordance with the
provisions thereof on the date hereof and the Note

 

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and the Basic Documents as heretofore amended or modified and as modified by
this Amendment are hereby ratified and affirmed. After this Amendment becomes
effective, all references to the Indenture, Note Purchase Agreement and Sale and
Servicing Agreement, “hereof,” “herein,” or words of similar effect referring to
the Indenture, Note Purchase Agreement or Sale and Servicing Agreement shall be
deemed to mean the Indenture, Note Purchase Agreement or the Sale and Servicing
Agreement as amended by the First Omnibus Amendment, the Second Omnibus
Amendment, the Third Omnibus Amendment, the Fourth Omnibus Amendment and as
further amended hereby. This Amendment shall not constitute a novation of the
Indenture, Note Purchase Agreement or Sale and Servicing Agreement, but shall
constitute an amendment thereof.

Section 9. GOVERNING LAW; JURISDICTION. THIS AMENDMENT SHALL BE GOVERNED BY, AND
CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK, WITHOUT
REFERENCE TO ITS CONFLICT OF LAW PROVISIONS. EACH OF THE PARTIES TO THIS
AMENDMENT HEREBY AGREES TO THE JURISDICTION OF THE UNITED STATES DISTRICT COURT
FOR THE SOUTHERN DISTRICT OF NEW YORK AND ANY APPELLATE COURT HAVING
JURISDICTION TO REVIEW THE JUDGMENTS THEREOF. EACH OF THE PARTIES HEREBY WAIVES
ANY OBJECTION BASED ON FORUM NON CONVENIENS AND ANY OBJECTION TO VENUE OF ANY
ACTION INSTITUTED HEREUNDER IN ANY OF THE AFOREMENTIONED COURTS AND CONSENTS TO
THE GRANTING OF SUCH LEGAL OR EQUITABLE RELIEF AS IS DEEMED APPROPRIATE BY SUCH
COURT.

Section 10. Paragraph Headings. The paragraph headings contained in this
Amendment are and shall be without substance, meaning or content of any kind
whatsoever and are not a part of the agreement among the parties thereto.

Section 11. Successors and Assigns. The provisions of this Amendment shall be
binding upon and inure to the benefit of the parties hereto and their respective
successors and assigns.

Section 12. Integration. This Amendment represents the entire agreement of the
parties hereto with respect to the amendment of the Basic Documents. There are
no representations, agreements, arrangements or understandings, oral or written,
between the parties hereto, relating to the subject matter of this Amendment,
which are not fully expressed herein.

Section 13. Severability. If any provisions of this Amendment shall be held
invalid or unenforceable in whole or in part in any jurisdiction, such provision
shall, as to such jurisdiction, be ineffective to the extent of such invalidity
or enforceability without in any manner affecting the validity or enforceability
of such provision in any other jurisdiction or the remaining provisions of this
Amendment in any jurisdiction.

Section 14. Further Assurances. The parties hereto shall, at any time and from
time to time following the execution of this Amendment, execute and deliver all
such further instruments and take all such further action as may be reasonably
necessary or appropriate in order to carry out the provisions of this Amendment.

Section 15. Consultation with Advisors. Each of the parties hereto acknowledge
that it has consulted with counsel and with such other experts and advisors as
it has deemed necessary in connection with the negotiation, execution and
delivery of this Amendment. This Amendment shall be construed without regard to
any presumption or rule requiring that it be construed against the party causing
this Amendment or any part thereof to be drafted.

 

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Section 16. Counterparts. This Amendment may be executed in one or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument. Delivery of an executed
counterpart of a signature page by telecopier shall be effective as delivery of
a manually executed counterpart.

Section 17. Costs and Expenses. The Issuer agrees that the obligations of the
Issuer pursuant to Section 10.13(a)(ii) of the Note Purchase Agreement shall
extend to the preparation, execution and delivery of this Amendment, the Amended
and Restated Note and any other documentation contemplated hereby (whether or
not this Amendment or the Amended and Restated Note becomes effective or the
transactions contemplated hereby and thereby are consummated), including, but
not limited to, the reasonable fees and disbursements of Skadden, Arps, Slate,
Meagher & Flom LLP, counsel to the Note Purchaser.

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IN WITNESS WHEREOF, this Amendment has been duly executed as of the day and year
first above written.

 

U.S. BANK NATIONAL ASSOCIATION, as

Custodian and as Indenture Trustee By:  

/s/ Kyle Harcourt

Name:   Kyle Harcourt Title:   Vice President

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NEWSTAR WAREHOUSE FUNDING 2005 LLC, as Purchaser and as Issuer By:  

NEWSTAR FINANCIAL, INC., its designated

manager

By:  

/s/ John J. Frishkopf

Name:   John J. Frishkopf Title:   Treasurer

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NEWSTAR FINANCIAL, INC., as Purchaser and as Issuer By:  

/s/ John J. Frishkopf

Name:   John J. Frishkopf Title:   Treasurer

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CITIGROUP GLOBAL MARKETS REALTY

CORP., as Note Purchaser

By:  

/s/ John Pawlowski

Name:   John Pawlowski Title:   Authorized Signer

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LYON FINANCIAL SERVICES, INC., as Backup

Servicer

By:  

/s/ Joseph Andries

Name:   Joseph Andries Title:   Senior Vice President