Exhibit 10(b)

FIRST AMENDMENT TO THE LOAN AND SERVICING AGREEMENT

This FIRST AMENDMENT TO THE LOAN AND SERVICING AGREEMENT, dated as of May 6,
2008 (this “Amendment”), is entered into among NewStar DB Term Funding LLC, a
Delaware limited liability company (the “Borrower”), NewStar Financial, Inc., a
Delaware corporation (“NewStar”), Tahoe Funding Corp., a Delaware corporation
(the “Lender”), Deutsche Bank AG, New York Branch (“DB”), as lender agent for
the Lender (the “Lender Agent”), DB, as administrative agent for the Lender (in
such capacity, and together with any successor thereto in such capacity, the
“Administrative Agent”), U.S. Bank National Association, a national banking
association (the “Trustee”) and Lyon Financial Services, Inc., a Minnesota
corporation doing business as U.S. Bank Portfolio Services (the “Backup
Servicer”) (collectively, the “Parties”).

R E C I T A L S

A. The Parties are parties to that certain Loan and Servicing Agreement, dated
as of November 7, 2007 (together with all exhibits and schedules thereto, the
“Agreement”);

B. The Borrower desires to receive and the Lender desires to provide
$100,000,000 of additional financing under the Agreement; and

C. The Borrower and the Lender desire to modify certain additional terms of the
Agreement as hereinafter set forth.

NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency
of which are hereby acknowledged, the parties agree as follows:

1. Certain Defined Terms. Capitalized terms that are used herein without
definition and that are defined in the Agreement shall have the same meanings
herein as in the Agreement.

2. Amendments.

(a) The amount set forth on the cover page of the Agreement is hereby deleted
and replaced with “U.S. $400,000,000”.

(b) The definition of “Adjusted Principal Balance” in Section 1.1 of the
Agreement is hereby deleted in its entirety and replaced with the following
definition:

““Adjusted Principal Balance”: On any date of determination, with respect to a
Delinquent Loan, an amount equal to the lesser of (i) the product of (a) the
applicable Moody’s Recovery Rate and (b) the Outstanding Loan Balance of such
Loan and (ii) the Market Value of such Loan, if one exists.”

(c) Subsection (b) of the definition of “Aggregate Excess Concentration Amount”
in Section 1.1 of the Agreement is hereby deleted in its entirety and replaced
with the following subsection:

“(b) that are Second Lien Loans, Subordinated Loans, B-Note Loans, LOT Loans and
Mezzanine Loans exceeds the greater of 5% of the Aggregate Outstanding Loan
Balance and $7,500,000;”

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(d) Subsection (c) of the definition of “Aggregate Excess Concentration Amount”
in Section 1.1 of the Agreement is hereby deleted in its entirety and replaced
with the word “[Reserved];”

(e) Subsection (h) of the definition of “Aggregate Excess Concentration Amount”
in Section 1.1 of the Agreement is hereby deleted in its entirety and replaced
with the following subsection:

“(h) to Obligors with a principal place of business in or organized under the
laws of, or substantially all of the assets of which are located in, Canada,
exceeds 10% of the Aggregate Outstanding Loan Balance;”

(f) Subsection (j) of the definition of “Aggregate Excess Concentration Amount”
in Section 1.1 of the Agreement is hereby deleted in its entirety and replaced
with the following subsection:

“(j) that are Revolving Loans exceeds the greater of 20% of the Aggregate
Outstanding Loan Balance and $30,000,000;”

(g) Subsection (l) of the definition of “Aggregate Excess Concentration Amount”
in Section 1.1 of the Agreement is hereby deleted in its entirety and replaced
with the following subsection:

“(l) that are Re-Discount Loans exceeds 10% of the Aggregate Outstanding Loan
Balance;”

(h) Subsection (s) of the definition of “Aggregate Excess Concentration Amount”
in Section 1.1 of the Agreement is hereby deleted in its entirety and replaced
with the following subsection:

“(s) that are Participations (other than Initial Participations) exceeds the
greater of 5% of the Aggregate Outstanding Loan Balance and $10,000,000;

(i) Subsection (u) of the definition of “Aggregate Excess Concentration Amount”
in Section 1.1 of the Agreement is hereby deleted in its entirety and replaced
with the following subsection:

“(u) that are Delinquent Loans or Charged-Off Loans exceeds 5.0% of the
Aggregate Outstanding Loan Balance;”

(j) The definition of “Amortization Advance Rate” is deleted in its entirety.

 

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(k) Subsection (c) of the definition of “Early Amortization Event” in
Section 1.1 of the Agreement is hereby deleted in its entirety and replaced with
the following subsection:

“(c) as of any Determination Date, the Average Pool Delinquency Ratio exceeds
5.0%;”

(l) Subsection (ee) of the definition of “Eligible Loan” in Section 1.1 of the
Agreement is hereby deleted in its entirety and replaced with the following
subsection:

“(ee) as of the date such Loan became part of the Collateral, such Loan is not
and has never been delinquent in payment of either principal or interest (unless
otherwise approved by the Administrative Agent);”

(m) Subsection (ff) of the definition of “Eligible Loan” in Section 1.1 of the
Agreement is hereby deleted in its entirety and replaced with the following
subsection:

“(ff) as of the date such Loan became part of the Collateral, there is no
default, breach, violation, event or condition which would give rise to a right
of acceleration existing under the Underlying Instruments relating to such Loan
and no event which, with the passage of time or with notice and the expiration
of any grace or cure period, would constitute a default, breach, violation,
event or condition which would give rise to a right of acceleration;”

(n) Subsection (h) of the definition of “Eligible Obligor” in Section 1.1 of the
Agreement is hereby deleted in its entirety and replaced with the following
subsection:

“(h) except with respect to a DIP Loan, as of the date such Loan became part of
the Collateral, is not (and has not been for at least three years) the subject
of an Insolvency Event, and such Obligor is not in financial distress and has
not experienced a material adverse change in its condition, financial or
otherwise, as determined by the Servicer; and”

(o) Subsection (i) of the definition of “Eligible Obligor” in Section 1.1 of the
Agreement is hereby deleted in its entirety and replaced with the following
subsection:

“(i) is not (and has never been), as of the date such Loan became part of the
Collateral, an Obligor of a Charged-Off Loan or a Delinquent Loan.”

(p) The definition of “Facility Amount” in Section 1.1 of the Agreement is
hereby deleted in its entirety and replaced with the following definition:

““Facility Amount”: The lesser of (a) $400,000,000, as such amount may vary from
time to time upon the written agreement of the Borrower, the Administrative
Agent and each Lender Agent, and (b) the aggregate Commitments then in effect;
provided that on or after the Termination Date, the Facility Amount shall mean
the Advances Outstanding.”

 

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(q) The definition of “Maximum Borrowing Base” in Section 1.1 of the Agreement
is hereby deleted in its entirety and replaced with the following definition:

““Maximum Borrowing Base”: At any time, an amount equal to the sum of (A) the
difference between (i) the excess of (x) Aggregate Outstanding Loan Balance over
(y) the Aggregate Excess Concentration Amount and (ii) the greater of (a) the
Minimum Equity Amount and (b) the aggregate Outstanding Loan Balances of
Eligible Loans of the five largest Obligors, plus (B) the amount on deposit (and
not including any Excluded Amounts and any amounts on deposit in the Revolving
Collections Account) in the Principal Collections Account received in reduction
of the Outstanding Loan Balance of any Loan owned by the Borrower; provided that
during the Amortization Period, the Maximum Borrowing Base shall be equal to the
Advances Outstanding.”

(r) The definition of “Re-Discount Loan” in Section 1.1 of the Agreement is
hereby deleted in its entirety and replaced with the following definition:

““Re-Discount Loan”: Any loan that advances an amount that represents a discount
on the value of the financial assets collateralizing such Loan or that is
underwritten using cash flow analysis and modeling techniques that are
consistent with those used for issuances of asset-backed securities involving
similar pools of assets with similar characteristics as the specified pool of
assets collateralizing such Loan; provided that any Re-Discount Loan (a) that
becomes part of the Collateral on or after May 6, 2008 or (b) where the pool of
assets collateralizing such Loan primarily consists of residential real property
shall not be considered an Eligible Loan for purposes of this Agreement.”

(s) The definition of “Required Reduction Target” is deleted in its entirety.

(t) Clause (ix) in Section 2.8(a) of the Agreement is hereby deleted in its
entirety and replaced with the word “[Reserved];”

(u) Section 2.10(a) of the Agreement is amended by replacing the reference to
“2.00%” in the second sentence with “2.25%”.

(v) Clause (v) of Section 3.2(b) of the Agreement is hereby deleted in its
entirety and replaced with the following:

“(v) The Minimum Equity Amount shall be equal to or greater than the greater of
(i) $30,000,000 and (ii) the aggregate Outstanding Loan Balances of Eligible
Loans of the five largest Obligors; and”

 

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(w) The last sentence of Section 6.4(j) of the Agreement is hereby deleted in
its entirety and replaced with the following:

“During an Amortization Period not caused by an Early Amortization Event (and
for so long as no Early Amortization Event has occurred and is continuing)
collections of principal on Revolving Loans that are not Delinquent Loans or
Charged-Off Loans shall be deposited into the Revolving Collections Account to
fund advances on such Revolving Loans in an amount not to exceed the aggregate
Outstanding Loan Balances of such Revolving Loans owned by the Borrower as of
the last day of the Revolving Period; provided that, for so long as Advances
Outstanding are greater than zero and Interest Collections are insufficient to
pay the amounts set forth in Section 2.8(a)(i) through (x), the Servicer shall
instead cause all collections of principal on such Revolving Loans to be
deposited into the Principal Collections Account until such amounts are paid in
full.”

(x) Section 10.1(o) of the Agreement is hereby deleted in its entirety and
replaced with the following:

“(o) the Asset-to-Debt Ratio of the Borrower is (i) less than 125% during the 12
months immediately following the termination of the Revolving Period and
(ii) less than 130% thereafter; or”

(y) Schedule X to the Agreement is hereby deleted in its entirety and replaced
with schedule attached to this Amendment as Exhibit A.

(z) Schedule XII to the Agreement is hereby deleted in its entirety.

3. Representations of the Borrower and NewStar. Each of the Borrower and NewStar
represents and warrants for itself as follows:

(a) It has taken all necessary action to authorize the execution, delivery and
performance of this Amendment.

(b) This Amendment has been duly executed and delivered by such Person and
constitutes such Person’s legal, valid and binding obligation, enforceable in
accordance with its terms, except as such enforceability may be subject to
(i) bankruptcy, insolvency, reorganization, fraudulent conveyance or transfer,
moratorium or similar laws affecting creditors’ rights generally and
(ii) general principles of equity (regardless of whether such enforceability is
considered in a proceeding at law or in equity).

(c) No consent, approval, authorization or order of, or filing, registration or
qualification with, any court or governmental authority or third party is
required in connection with the execution, delivery or performance by such
Person of this Amendment.

(d) The execution and delivery of this Amendment does not (i) violate,
contravene or conflict with any provision of its organization documents or
(ii) violate, contravene or conflict in any material respect with any laws
applicable to it.

 

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(e) Immediately after giving effect to this Amendment, (i) the representations
and warranties of the Borrower and NewStar set forth in the Agreement and the
Loan Documents shall be true and correct and (ii) no Termination Event or
Unmatured Termination Event shall have occurred and be continuing.

4. Effect of Amendment. Except as expressly amended and modified by this
Amendment, all provisions of the Agreement shall remain in full force and
effect. After this Amendment becomes effective, all references in the Agreement
to “this Agreement”, “hereof”, “herein” or words of similar effect referring to
the Agreement shall be deemed to be references to the Agreement as amended by
this Amendment. This Amendment shall not be deemed to expressly or impliedly
waive, amend or supplement any provision of the Agreement other than as set
forth herein.

5. Effectiveness. This Amendment shall become effective as of the date hereof
upon receipt by the Administrative Agent of counterparts of this Amendment
(whether by facsimile or otherwise) executed by each of the other parties
hereto. By their signature below, the Administrative Agent and Lender authorize
and direct the Trustee and Backup Servicer to execute and deliver this
Amendment.

6. Counterparts. This Amendment may be executed in any number of counterparts
and by different parties on separate counterparts, and each counterpart shall be
deemed to be an original, and all such counterparts shall together constitute
but one and the same instrument.

7. Governing Law. This Amendment shall be governed by, and construed in
accordance with, the laws of the State of New York.

8. Section Headings. The various headings of this Amendment are inserted for
convenience only and shall not affect the meaning or interpretation of this
Amendment or the Agreement or any provision hereof or thereof.

[NO FURTHER TEXT ON THIS PAGE]

 

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IN WITNESS WHEREOF, the parties have executed this Amendment as of the date
first written above.

 

NEWSTAR DB TERM FUNDING LLC By:  
NewStar Financial, Inc., its Designated Manager By:   /s/ John Kirby Bray Name:
  John Kirby Bray Title:   Chief Financial Officer NEWSTAR FINANCIAL, INC. By:  
/s/ John Kirby Bray Name:   John Kirby Bray Title:   Chief Financial Officer
DEUTSCHE BANK AG, NEW YORK BRANCH By:   /s/ John Malone Name:   John Malone
Title:   Director By:   /s/ Robert Sheldon Name:   Robert Sheldon Title:  
Director TAHOE FUNDING CORP. By:   /s/ Jill A. Gordon Name:   Jill A. Gordon
Title:   Vice President

First Amendment to Loan and Servicing Agreement

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Acknowledged and Agreed:

U.S. BANK NATIONAL ASSOCIATION,

as Trustee

By:   /s/ Kyle Harcourt Name:   Kyle Harcourt Title:   Vice President

LYON FINANCIAL SERVICES, INC.,

d/b/a U.S. Bank Portfolio Services, as Backup Servicer

By:   /s/ Joseph Andries Name:   Joseph Andries Title:   Senior Vice President

First Amendment to Loan and Servicing Agreement

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EXHIBIT A

AMENDED SCHEDULE X TO THE LOAN AND SERVICING AGREEMENT

[to be provided by Deutsche Bank]

First Amendment to Loan and Servicing Agreement