EXHIBIT 10.7
 
AMENDMENT NUMBER ONE
to the
Letter Agreement
dated as of May 30, 2002
by and between
NEW CENTURY FUNDING SB-1
and
SALOMON BROTHERS REALTY CORP.
 
This AMENDMENT NUMBER ONE (this “Amendment”) is made this 23rd day of December,
2002, by and between NEW CENTURY FUNDING SB-1, having an address at 18400 Von
Karman, Irvine, California 92612 (“the Seller”) and SALOMON BROTHERS REALTY
CORP., having an address at 390 Greenwich Street, New York, New York 10013 (the
“Buyer”) to the LETTER AGREEMENT, dated as of May 30, 2002, between the Seller
and the Buyer (the “Letter Agreement”).
 
RECITALS
 
WHEREAS, the Seller has requested that Buyer agree to amend the Letter Agreement
to extend the term thereof and to make such additional modifications to the
Letter Agreement as more expressly set forth below and the Buyer has agreed to
such request.
 
WHEREAS, as of the date of this Amendment, the Seller represents to the Buyer
that it is in compliance with all of the representations and warranties and all
of the affirmative and negative covenants set forth in the Letter Agreement and
the Master Repurchase Agreement, dated as of May 30, 2002, between the Seller
and the Buyer (the “Master Repurchase Agreement”) and not in default under the
Letter Agreement or the Master Repurchase Agreement.
 
NOW THEREFORE, for good and valuable consideration, the receipt and sufficiency
of which are hereby acknowledged, and of the mutual covenants herein contained,
the parties hereto hereby agree as follows:
 
SECTION 1.    Effective as of December 23, 2002, Section 1 of the Letter
Agreement is hereby amended as follows:
 
(a)  The definition of “Buyer’s Margin Percentage” shall be deleted in its
entirety and replaced with the following:
 
“Buyer’s Margin Percentage” shall mean, with respect to any Transaction as of
any date of determination, 100.00%.”
 
(b)  The definition of “Pricing Rate” shall be deleted in its entirety and
replaced with the following:

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“Pricing Rate” shall be equal to LIBOR as of any date of determination plus
1.00%. The Pricing Rate is calculated on the basis of a 360-day year and the
actual number of days elapsed between the Purchase Date and the date of
determination.”
 
SECTION 2.    Defined Terms.    Any terms capitalized but not otherwise defined
herein shall have the respective meanings set forth in the Letter Agreement.
 
SECTION 3.    Representations.    In order to induce the Buyer to execute and
deliver this Amendment Number One, the Seller hereby represents to the Buyer
that as of the date hereof, after giving effect to this Amendment Number One,
the Seller is in full compliance with all of the terms and conditions of the
Letter Agreement and the Master Repurchase Agreement and no Default or Event of
Default has occurred under the Letter Agreement and the Master Repurchase
Agreement.
 
SECTION 4.    Limited Effect.    This Amendment Number One shall become
effective upon the execution hereof by the parties hereto. Except as expressly
amended and modified by this Amendment Number One, the Letter Agreement shall
continue in full force and effect in accordance with its terms. Reference to
this Amendment Number One need not be made in the Letter Agreement or any other
instrument or document executed in connection therewith, or in any certificate,
letter or communication issued or made pursuant to, or with respect to, the
Letter Agreement, any reference in any of such items to the Letter Agreement
being sufficient to refer to the Letter Agreement as amended hereby.
 
SECTION 5.    GOVERNING LAW.    THIS AMENDMENT NUMBER ONE SHALL BE CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK AND THE OBLIGATIONS, RIGHTS,
AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH
SUCH LAWS WITHOUT REGARD TO CONFLICT OF LAWS DOCTRINE APPLIED IN SUCH STATE
(OTHER THAN SECTION 5-1401 OF THE NEW YORK GENERAL OBLIGATIONS LAW).
 
SECTION 6.    Counterparts.    This Amendment Number One may be executed by each
of the parties hereto on any number of separate counterparts, each of which
shall be an original and all of which taken together shall constitute one and
the same instrument.
 
 
 
[SIGNATURE PAGE FOLLOWS]

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IN WITNESS WHEREOF, the Buyer and the Seller have caused this Amendment Number
One to be executed and delivered by their duly authorized officers as of the day
and year first above written.
 
SALOMON BROTHERS REALTY CORP.
By:
 
/s/    EVAN J. MITNICK

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Name:
Title: Vice President

 
 
NEW CENTURY FUNDING SB-1
By:
 
/s/    ILLEGIBLE

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Name:
Title:

 
 
The undersigned Guarantors under the Guaranty and Pledge Agreement dated as of
May 30, 2002, hereby acknowledges and agrees to the amendments, modifications
and supplements to the Letter Agreement made pursuant to this Amendment Number
One.
 
NEW CENTURY MORTGAGE CORPORATION
By:
 
/s/    KEVIN CLOYD

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Name:
Title: Senior Vice President

 
 
NEW CENTURY FINANCIAL CORPORATION
By:
 
/s/    LARRY MORETTI

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Name:
Title: SVP, CIO

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