Exhibit 10.3

THIS MANAGEMENT AGREEMENT (this “Agreement”) is dated as of the 2nd day of
November, 2016, by and between NYMT Loan Financing, LLC, a Delaware limited
liability company (the “Company”), and Headlands Asset Management, LLC, a
California limited liability company (the “Manager”).
WHEREAS, the Company is a subsidiary of New York Mortgage Trust, a Maryland
corporation (“NYMT”), that maintains its principal place of business in
California and specializes in acquiring, owning and managing various mortgage
related and financial assets; and
WHEREAS, the Company desires to retain the Manager to provide investment
management services for the Company in the manner and on the terms set forth
herein and the Manager wishes to be retained to provide such services.
NOW, THEREFORE, in consideration of the mutual agreements set forth herein and
for other good and valuable consideration, the receipt and sufficiency of which
are hereby acknowledged, the Company and the Manager agree as follows:
1.
Definitions. Capitalized terms used in this Agreement, and not otherwise
defined, shall have the respective meanings assigned to them below:

1.1.    “Adjusted Net Income” is defined as pre-tax net income (or loss)
calculated in accordance with GAAP, excluding (1) all unrealized gains and
losses, (2) depreciation and amortization of fixed assets and other capitalized
costs, and (3) direct or allocated costs of overhead and general expenses,
including but not limited to legal fees, investor relations expense and bank
service charges, but including (1) all expenses paid to or on behalf of the
Manager in connection with acquiring or managing the Investments, and (2)
amortization of capitalized costs of Investments. For purposes of this
calculation, interest expense will be calculated using the average Debt
outstanding during the applicable Calculation Period (as defined in section
5.2.1) and the weighted average cost of funds for the actual Debt outstanding
during the same Calculation Period.
1.2.     “Affiliate” means, when used with reference to a specified Person, any
Person that directly, or indirectly through one or more intermediaries, Controls
or is Controlled by, or is under common Control with the specified Person.
1.3.    “Agreement” has the meaning set forth in the Preamble.
1.4.    “Ancillary Fees” is the total of Servicing Fees and Servicing
Surveillance Fees.
1.5.    “Assets” means the aggregate net carrying value (in accordance with
GAAP) of all Investments, specifically excluding (1) any unrealized gains or
losses that have impacted net carrying value as reported in NYMT’s financial
statements prepared in accordance with GAAP, regardless of whether such items
are included in other comprehensive income or loss or in net income, (2)
one-time events pursuant to changes in GAAP, (3) impairment reserves recorded
but not realized if not included in unrealized gains or losses, and (4) certain
non-cash items not otherwise described

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above, in each case, as mutually agreed between the Manager and Company but
including borrower and servicer receivables directly related to the Investments.
1.6.    “Base Management Fee” has the meaning set forth in Section 5.1.1.
1.7.    “Calculation Period” has the meaning set forth in Section 5.2.1.
1.8.    “Company” has the meaning set forth in the Preamble.
1.9.    “Code” means the Internal Revenue Code 1986, as amended.
1.10.    “Compliance Requirements” has the meaning set forth in Section 2.1.
1.11.    “Control” (including the correlative meanings of the terms “Controls,”
“Controlled by” and “under common Control with”), as used with respect to any
Person, means the possession, directly or indirectly, of the power to direct or
cause the direction of the management and policies of such Person, through the
ownership of voting securities, partnership interests or other equity interests,
by contract or other means.
1.12.    “Debt” means the greater of (A) the net carrying value (in accordance
with GAAP, excluding adjustments for unrealized gains or losses) of all
third-party debt or liabilities secured by the Investments and (B) prior to
termination of this Agreement, zero.
1.13.    “Deficit Adjustment” has the meaning set forth in Section 5.2.1. For
avoidance of doubt, the application of the Deficit Adjustment mechanism will
work as follows:
For the fourth fiscal quarter of each calendar twelve (12) month period during
the term of this Agreement, the Incentive Management Fee shall be payable in an
amount equal to the excess, if any, of (x) 35% of the dollar amount by which
Adjusted Net Income attributable to the Investments during the calendar twelve
(12) month period, before the Incentive Management Fee, exceeds the Hurdle Rate,
less (y) the total Incentive Management Fees paid for the first three quarters
of each such calendar twelve (12) month period during the term of this
Agreement. If incentive fees paid during the first three quarters exceed the
amount owed on an annual basis the excess will be considered prepaid incentive
fees and will be deducted from future incentive fees owed to the Manager.
1.14.    “Effective Date” has the meaning set forth in Section 15.
1.15.    “Equity” means (A) Assets LESS (B) Debt.
1.16.    “Exchange Act” means the Securities Exchange Act of 1934, as amended.
1.17.    “GAAP” means United States generally accepted accounting principles.
1.18.    “Governing Instruments” means, with regard to any entity, the articles
of incorporation and bylaws in the case of a corporation, certificate of limited
partnership (if applicable) and the partnership agreement in the case of a
general or limited partnership, the articles of formation

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and the operating agreement in the case of a limited liability company, the
trust instrument in the case of a trust, or similar governing documents, in each
case as amended from time to time.
1.19.    “Guidelines” has the meaning set forth in Exhibit A.
1.20.    “High Water Mark” has the meaning set forth in Section 5.2.1.
1.21.    “High Water Mark Shortfall” has the meaning set forth in Section 5.2.1.
1.22.    “Hurdle Rate” has the meaning set forth in Section 5.2.1.
1.23.    “Incentive Management Fee” has the meaning set forth in Section 5.2.1.
1.24.    “Independent Directors” means a director who is not affiliated,
directly or indirectly, with the Manager or the Company, whether by ownership
of, ownership interest in, employment by, or any material business or
professional relationship with the Manager or the Company (other than solely in
the capacity of a director of the Company).
1.25.    “Initial Term” has the meaning set forth in Section 9.1.
1.26.    “Investment Advisers Act” means the Investment Advisers Act of 1940, as
amended from time to time.
1.27.    “Investments” means the (1) residential mortgage loans purchased
pursuant to this Agreement, and (2) real estate or other assets owned due to the
foreclosure or other liquidation of the mortgage loans described in (1) above.
1.28.    “Losses” has the meaning set forth in Section 5.4.
1.29.    “Management Fee” has the meaning set forth in Section 5.1.
1.30.    “Manager” has the meaning set forth in the Preamble.
1.31.    “NYMT” has the meaning forth in the recitals.
1.32.    “Person” means any individual, corporation, partnership, joint venture,
limited liability company, estate, trust, unincorporated association, any
federal, state, county or municipal government or any bureau, department or
agency thereof and any fiduciary acting in such capacity on behalf of any of the
foregoing.
1.33.    “REIT” means real estate investment trust as defined under Section 856
of the Code.
1.34.    “Renewal Term” has the meaning set forth in Section 9.1.
1.35.    “Servicing Fee” means with respect to any Investment, 0.75% per annum
of the unpaid principal balance calculated in the same manner as described in
Section 5.3.
1.36.    “Servicing Surveillance Fee” has the meaning set forth in Section 5.3.

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1.37.    “Termination Date” means the date on which the Manager ceases to
provide services.
1.38.     “Termination Notice” has the meaning set forth in Section 9.4.1
1.39.    “Third Parties” has the meaning set forth in Section 3.2.
2.
General Duties of the Manager.

2.1.    Services to be Provided by the Manager. The Manager will provide the
Company with investment management services in accordance with the terms and
conditions contained in this Agreement and other applicable laws and
regulations. Under this Agreement, the Manager shall manage the Investments
sourced by the Manager which are owned directly or indirectly by the Company or
its Affiliates, subject to the written investment guidelines set forth in
Exhibit A to this Agreement (the “Guidelines”) and the other terms and
conditions in this Agreement, and is hereby appointed the Company’s agent and
Attorney-in-Fact for that purpose. As such, the Manager is authorized to perform
the following relating to the Investments, at the Company’s expense, without
further approval from the Company, except as expressly required by this
Agreement or as required by law: (i) to make investment decisions; (ii) to buy,
sell and otherwise trade in residential loans and (iii) to select brokers or
dealers to execute residential loan transactions. Residential loans purchased
pursuant to this Agreement may be held of record in the name of the Company or
any of its Affiliates or one or more trustees, participation agents or other
entities for the benefit of the Company and its Affiliates, as the Company may
from time to time determine and advise the Manager. Notwithstanding the
foregoing, the Manager’s activities hereunder shall at all times be subject to
modification at the Company’s direction to ensure NYMT’s continuous compliance
with applicable requirements under the United States Internal Revenue Code and
the rules and regulations thereunder for NYMT to maintain its status as a REIT
and under the Investment Company Act of 1940, as amended (the “Investment
Company Act”) and the rules and regulations thereunder for NYMT and its
subsidiaries to maintain their exemption from regulation as an investment
company (collectively, the “Compliance Requirements”). The Manager shall be
responsible solely for the Investments and shall have no duty to inquire into or
review the management or investment of other assets of Company and its
Affiliates. The Manager agrees to perform its duties set forth herein in good
faith and in accordance with commercially reasonable standards, including,
without limitation:
2.1.1.    serving as the Company’s consultant with respect to the formulation of
the Guidelines and any modifications thereto, which shall be negotiated and
approved in good faith by each of the Manager and the Company, and other
policies for approval by the Company. The Guidelines set forth in Exhibit A
hereto, including any modifications directed by the Company in order to satisfy
the Compliance Requirements, shall be applied at the time a transaction is
entered into, regardless of later market movements, and shall not be deemed
breached as a result of changes in the value or status of an investment
following its acquisition;
2.1.2.    investigating, analyzing and selecting possible investment
opportunities;
2.1.3.    representing the Company in connection with the purchase, sale,
commitment to purchase or sell seasoned residential whole loans and other assets
that meet in all material respects the Company’s Guidelines, and managing the
Investments;

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2.1.4.    making available to the Company price information, statistical and
economic research, data and analysis regarding the Company’s activities and the
services performed for the Company by the Manager to the best of their ability;
2.1.5.    investing any of the Company’s money allocated to investments in
accordance with the Company’s Guidelines;
2.1.6.    advising the Company in connection with investment and related policy
decisions to be made by it;
2.1.7.    assisting the Company in qualifying to do business in all applicable
jurisdictions and assisting the Company with obtaining and maintaining all
appropriate licenses in respect of its business activities under this Agreement;
2.1.8.    assisting the Company to retain qualified experts as and when needed;
2.1.9.    assisting the Company in its compliance with all federal, state and
local regulatory requirements applicable to the Company and its Affiliates in
respect of its business activities under this Agreement, including disclosure
associated with periodic reporting under the Exchange Act;
2.1.10.    assisting the Company and its Affiliates, if reasonably requested by
the Company, in their compliance with federal, state and local tax filings and
reports in respect of its business activities under this Agreement;
2.1.11.    recommending and overseeing one or more third party mortgage
servicers or directly servicing the underlying residential mortgage loan
Investments in compliance with current federal, state and local requirements;
2.1.12.    monitoring the operating performance of the Investments and providing
periodic reports with respect thereto to the Company, including comparative
information with respect to such operating performance and budgeted or projected
operating results;
2.1.13.    in respect of the Company’s business activities under this Agreement,
assisting the Company with the resolution of all claims, disputes or
controversies (including all litigation, arbitration, settlement or other
proceedings or negotiations) in which the Company may be involved or to which
the Company may be subject arising out of the Company’s day-to-day operations
hereunder, subject to the request and approval of the Company; and
2.1.14.    causing expenses incurred by or on behalf of the Company, in respect
of the Company’s business activities under this Agreement, to be commercially
reasonable or commercially customary and within any budgeted parameters or
expense guidelines set by the Company from time to time to which the Manager has
been notified.

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2.2.    Obligations of the Manager; Restrictions.
2.2.1.    Verify Conformity with Acquisition Criteria. The Manager shall refrain
from any action on behalf of the Company that does not comply with the
Guidelines adopted by the Company as in effect from time to time during the term
hereof. The Company will periodically review the Guidelines and the Company’s
portfolio of Investments, each in consultation with the Manager, but may not
review each proposed investment. If the Company determines in its periodic
review of transactions that a particular transaction does not comply with the
Guidelines, then the Company will consider what corrective action, if any, can
be taken and the Manager will undertake such corrective action as directed by
the Company.
2.2.2.    Restrictions. The Manager acknowledges that NYMT intends to conduct
its operations in accordance with the Compliance Requirements and the Manager
agrees to use commercially reasonable efforts to cooperate with NYMT’s efforts
to conduct its operations in accordance with the Compliance Requirements. Such
cooperation will include refraining from any action which, in the Manager’s sole
judgment made in good faith in consultation with NYMT’s legal counsel, (A) would
adversely affect the status of NYMT or, if applicable, any Affiliate of NYMT as
a REIT, (B) would adversely affect NYMT’s, or any NYMT Affiliates’, exclusion
from status as an investment company under the Investment Company Act, (C) is
not in compliance with the Guidelines (unless otherwise consented to by the
Company in writing) or (D) would violate any material law, rule or regulation of
any governmental body or agency having jurisdiction over the Company or any of
its Affiliates or which would otherwise not be permitted by the Company’s or
such Affiliate’s Governing Instruments or any agreements provided to the
Manager. If the Manager is directed to take any such action by the Company
(including, without limitation, any corrective action directed to be taken
pursuant to Section 2.2.1), the Manager shall promptly notify the Company of the
Manager’s judgment that such action would adversely affect such status or
violate any such law, rule or regulation or the Governing Instruments; operating
policies adopted by the Company; or any agreements provided to the Manager.
2.2.3.     Interested Transactions. Except as set forth in this Agreement, the
Manager shall not (i) consummate any transaction which would involve the
acquisition by the Company of an asset in which the Manager or any Affiliate
thereof has an ownership interest or the sale by the Company of an asset to the
Manager or any Affiliate thereof, or (ii) cause the Company to pay, or become
liable to the Manager for, any amounts not specifically provided for herein,
unless such transaction or action, as the case may be and in each case, is
approved by the Company.
2.2.4.    Portfolio Transactions. In placing portfolio transactions and
selecting brokers or dealers, the Manager shall obtain on behalf of the Company
commercially reasonable terms. In assessing commercially reasonable terms for
any transaction, the Manager shall consider all factors it deems relevant,
including the breadth of the market in the residential loans, the price of the
residential loans, the financial condition and execution capability of the
broker or dealer, and the reasonableness of the commission, if any, both for the
specific transaction and on a continuing basis.
2.2.5.    Reports. The Manager shall prepare regular reports for the Company to
enable the Company to review its acquisitions, portfolio composition and
characteristics, credit

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quality, performance and compliance with the investment criteria and policies
approved by the Company. (See Section 4.2 and 4.3 for further detail)
2.2.6.    Insurance Coverage. The Manager shall maintain reasonable and
customary “errors and omissions” insurance coverage and other customary
insurance coverage. The premium for such insurance shall be paid by the Manager
or its Affiliates.
2.3.    Cooperation of the Company. The Company agrees to take all actions
reasonably required to permit the Manager to carry out its duties and
obligations under this Agreement. The Company further agrees to make available
to the Manager all materials reasonably requested by the Manager to enable the
Manager to satisfy its obligations to the Company. Upon request by the Manager
and provided funds have been allocated by the Company to Investments, the
Company agrees to use its commercially reasonable efforts to make such funds
available to the Manager to fund any Investment that satisfies the Guidelines.
3.
Devotion of Time; Additional Activities of the Manager and its Affiliates.

3.1.    Devotion of Time. The Manager will devote such of its time in connection
with the investment management services to be provided hereunder as the Manager
reasonably deems necessary and appropriate to perform fully its obligations
hereunder.
3.2.    Other Activities; Competition. The Manager, or any Affiliate of the
Manager, may act as manager for any other persons, firms or corporations other
than the Company (hereinafter collectively referred to as “Third Parties”), the
investment objectives or policies of which may or may not be similar to those of
the Company. The Manager or any such Affiliate may buy, sell or trade any
mortgage loans, securities, commodities or real estate for the Manager’s own
accounts or for the accounts of others for whom the Manager or any such
Affiliate may be acting.
Notwithstanding the foregoing, the Manager is prohibited from advising Third
Parties that are operating as a REIT or public REIT, other than the Company and
its Affiliates, with respect to any investment opportunity that falls within the
Guidelines unless (i) the Company specifically refuses to fund such specific
investment opportunity in writing, (ii) the Company refuses to allocate capital
for investment opportunities that fall within the Guidelines and are sourced or
managed by the Manager for 120 days after such allocation has been requested by
the Manager in writing, (iii) the Company makes a statement in writing that it
is no longer willing to allocate capital for investment opportunities managed by
the Manager, (iv) the Company makes a statement in writing to waive such
condition, or (v) the aggregate amount of capital investments of any such Third
Party REIT or public REIT for which the Manager is providing advice is less than
$25 million.
 
Notwithstanding the foregoing, nothing herein shall prohibit the Manager from
advising any Third Parties on investments that are outside of the Guidelines.

If the Company and the Manager are unable in good faith to reach agreement on
any changes to the Guidelines pursuant to Section 2.1.1 hereof within 60 days
following the commencement of negotiations related thereto the restrictions set
forth in this section shall have no further force or effect. The Manager will
continue to use its best judgment and effort in rendering services and, in

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furtherance of the foregoing, the Manager shall not undertake activities which,
in its good faith judgment, will substantially and adversely affect the
performance of its obligations under this Agreement.
 
3.3.    Allocation of Investment Opportunities and Aggregation Policy.
3.3.1.    Allocation of Investment Opportunities. The Company and the Manager
agree that to the extent the Manager provides management services to Third
Parties with investment objectives similar to the Company, and the Manager
identifies an investment opportunity or opportunities suitable for the Company
and one or more Third Parties, and such investment is of a size that requires an
allocation of such investment between the Company and one or more Third Parties,
the Manager will allocate such investment in a fair and equitable manner and
will take into account the following considerations: (i) the primary investment
strategy and the particular stage in portfolio development within each company
managed by the Manager; (ii) the effect of the potential acquisition on the
diversification of each company’s portfolio’s investments by coupon, purchase
price, size, prepayment characteristics, and leverage; (iii) the cash
requirements of each company’s portfolio; (iv) the anticipated cash flow of each
company’s portfolio; and (iv) the amount of funds available to each company’s
portfolio and the length of time such funds have been available for investment.
The parties hereto acknowledge that information and recommendations provided by
the Manager to the Company may be different from the information and
recommendations supplied by the Manager or its Affiliates to Third Parties. The
Manager will notify the Company prior to making any trade in connection with an
allocation decision by the Manager to allocate investment opportunities between
the Company and any Third Parties.
3.3.2.    Aggregation Policy. The Company shall be entitled to equitable
treatment under the circumstances in receiving information, recommendations and
any other services, but the Company recognizes that it is not entitled to
receive preferential treatment as compared with the treatment given by the
Manager to any Third Parties. The parties hereto agree that (i) the Manager may
not aggregate transactions by the Company and other clients of the Manager and
its affiliates in circumstances where the Manager reasonably believes such
aggregation would result in best execution without prior approval from the
Company, (ii) each account’s books and records will separately reflect, where
orders are aggregated, the loans held by and bought and sold for each account,
and (iii) funds of participating accounts whose orders are aggregated will be
deposited with one or more banks or broker/dealers, and any cash attributable to
the accounts will not be held collectively for the respective owners any longer
than is commercially necessary to settle the purchase or sale in question on a
delivery versus payment basis.
4.
Records; Confidentiality.

4.1.    Records. The Manager shall maintain appropriate books of account and
records relating to services performed under this Agreement, and such books of
account and records shall be accessible for inspection by representatives of the
Company or any Affiliate of the Company at any time during normal business
hours. Except in the ordinary course of business of the Company, the Manager
shall keep confidential any and all information it obtains from time to time in
connection

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with the services it renders under this Agreement and shall not disclose any
portion thereof to non-affiliated third parties, except with the prior written
consent of the Company.
4.2.    Ad Hoc Reports. The Manager shall provide within an industry acceptable
timeframe diligence, servicing and exception reports produced by a third party
that was hired by the Manager and billed to the Company for reimbursement or
direct payment.
4.3.    Manager Reports. The Manager will provide the reports detailed in
Exhibit C on the prescribed delivery time period as set forth in Exhibit C.
Failure to deliver the reports on the prescribed time periods will result in the
suspension of the monthly fees owed to the Manager until the reports are
delivered.
5.
Compensation of the Manager.

5.1.    Base Management Fee.
5.1.1.    The Manager shall earn a Base Management Fee for each month during the
Initial Term and for each month during the Renewal Term that shall be calculated
and paid monthly, equal to 1/12th of 1.50% (per annum) of Equity (such amount
being hereinafter referred to as, the “Base Management Fee”). For purposes of
calculating the Base Management Fee, Equity shall be determined as of the last
day of the prior month. The Manager shall compute the Base Management Fee within
fifteen (15) business days after the beginning of each month and shall promptly
deliver such calculation to the Company for review. The Company is obligated to
pay any undisputed portion of the Base Management Fee within five (5) business
days following the delivery to the Company of the Manager’s written statement
setting forth the computation of the Base Management Fee for such month.
5.2.    Incentive Management Fee.
5.2.1.    The Manager will be entitled to a quarterly incentive fee (the
“Incentive Management Fee”) that shall be calculated quarterly and payable
within 60 days after the end of each fiscal quarter during the term of this
Agreement. The Incentive Fee (which shall be calculated in the manner described
in this section and as illustrated in Exhibit B) shall be subject to a high
water mark of 5% return on Equity (the “High Water Mark”), and shall be payable
with respect to each of the first three fiscal quarters during each calendar
twelve (12) month period during the term of this Agreement in an amount equal to
(1) the excess, if any, of the dollar amount by which Adjusted Net Income on an
annualized basis for such quarter and before the Incentive Fee, exceeds an
annualized 12.0% rate of return on Equity (the “Hurdle Rate”), times (ii) 35%,
and after adjusting for any carried forward excess (“Deficit Adjustment”) from
the previous quarters as described in Section 5.2.2. For the fourth fiscal
quarter of each calendar twelve (12) month period during the term of this
Agreement, the Incentive Management Fee shall be payable in an amount equal to
the excess, if any, of (x) 35% of the dollar amount by which Adjusted Net Income
attributable to the Investments during the calendar twelve (12) month period,
before the Incentive Management Fee, exceeds the Hurdle Rate, less (y) the total
Incentive Management Fees paid for the first three quarters of each such
calendar twelve (12) month period during the term of this Agreement. If
incentive fees paid during the first three quarters exceed the amount owed on an
annual basis the excess will

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be considered prepaid incentive fees and will be deducted from future incentive
fees owed to the Manager. The return on equity for each calendar quarter
(“Calculation Period”) shall be determined by dividing (A) the Adjusted Net
Income for the Calculation Period by (B) average Equity during the Calculation
Period.
5.2.2.    Any Incentive Management Fee payment will be subject to the High Water
Mark. Like the Hurdle Rate, which is calculated on a calendar twelve (12) month
basis, the High Water Mark is calculated on a calendar twelve (12) month basis
and shall reset every twenty-four (24) months. To the extent there was a
shortfall of Adjusted Net Income in the prior year’s High Water Mark
calculation, the Manager is required to recoup the dollar amount of the
shortfall before it can receive an Incentive Management Fee. For example, if in
the first calculation year, the Company earns an annualized return on Equity of
3%, which is 2% short of the High Water Mark, and this 2% deficit is equivalent
to a dollar amount of $2 million, the Manager would have to earn net profit of
$2 million in subsequent quarters to get above the High Water Mark before it
would be eligible again to receive an Incentive Management Fee. This is
independent of the new High Water Mark, which will have to be reached in the
following calendar years. An illustration of how the High Water Mark is
calculated is included on Exhibit B. The Deficit Adjustment means the amount of
incentive fee paid quarterly during any calendar year that exceeds the amount of
the year to date or annual incentive for the calendar year. The Deficit
Adjustment will be carried forward to future quarters in that calendar year and,
if necessary, future calendar years, as a reduction of the incentive fee owed
until the Deficit Adjustment is reduced to zero. The Deficit Adjustment amount
is calculated separately from the High Water Mark.
5.3.    Servicing Surveillance Fee. The Manager shall earn a Servicing
Surveillance Fee of 0.50% (per annum). The Servicing Surveillance Fee will be
payable monthly on or before the tenth (10th) business day of each month
calculated by multiplying 1/12th of the annual Servicing Surveillance Fee times
the Interest Bearing Unpaid Principal Balance (“UPB”) as of the opening of
business on the first (1st) day of the preceding month.
5.4.    Fee Offset. In the event the Company incurs, accrues or otherwise
suffers any losses under GAAP (“Losses”) as a result of the Manager’s (i)
failure to materially adhere to the Company’s Guidelines or (ii) material breach
of any term or condition hereof, without limiting any other rights and remedies
the Company may have in law or in equity against the Manager, any Management Fee
that would otherwise be due and owing hereunder (whether accrued and unpaid or
in the future) shall be offset against the amount of such Losses on a dollar for
dollar basis.
5.5.    Ancillary Fees. In no case will the Ancillary Fees exceed 1.25% (per
annum) calculated in the same manner as the Servicing Surveillance Fee as
described in section 5.3.
6.
Expenses of the Manager and the Company.

6.1.    Expenses of the Manager. Without regard to the compensation received
under this Agreement by the Manager, the Manager shall bear the following
expenses:

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6.1.1.    employment expenses of the personnel employed by the Manager and/or
its Affiliates, including, but not limited to, salaries, wages, payroll taxes
and the cost of employee benefit plans of such personnel.
6.1.2.    rent, telephone, utilities, office furniture, equipment, machinery,
and other office expenses of the Manager and/or its Affiliates.
6.2.    Expenses of the Company. The Company or any Affiliate of the Company
shall pay all of its expenses under this Agreement except those that are the
responsibility of the Manager pursuant to Section 6.1 of this Agreement, and
without limiting the generality of the foregoing, it is specifically agreed that
the following expenses of the Company or any Affiliate of the Company shall be
paid by the Company and shall not be paid by the Manager or Affiliates of the
Manager:
6.2.1.    expenses in connection with the issuance and transaction costs
incident to the acquisition, disposition and financing of Investments, including
those expenses that would customarily be capitalized as part of the Investment
and costs associated with the identification of potential investments and
performance of due diligence investigations thereon;
6.2.2.    the compensation and expenses of the Company’s directors and officers
and the cost of liability insurance to indemnify the Company’s directors and
officers;
6.2.3.    costs associated with the establishment and maintenance of any of the
Company’s credit or other indebtedness (including commitment fees, accounting
fees, legal fees, closing and other similar costs) or any of the Company’s
securities offerings;
6.2.4.    expenses connected with communications to holders of the Company’s
securities or of its Affiliates and other bookkeeping and clerical work
necessary in maintaining relations with holders of such securities and in
complying with the continuous reporting and other requirements of governmental
bodies or agencies, including, without limitation, all costs of preparing and
filing required reports with the SEC, the costs payable by the Company or its
Affiliates to any transfer agent and registrar in connection with the listing
and/or trading of the Company’s or its Affiliate’s stock on any exchange, the
fees payable by the Company or its Affiliates to any such exchange in connection
with its listing, costs of preparing, printing and mailing of the Company’s or
its Affiliates annual report to its stockholders and proxy materials with
respect to any meeting of the stockholders;
6.2.5.    costs associated with any computer software or hardware, electronic
equipment or purchased information technology or analytical services from
third-party vendors to the extent used for the Company and approved in advance
by the Company;
6.2.6.    expenses incurred by the Manager for reasonable travel on the
Company’s behalf and other reasonable out-of-pocket expenses incurred by
personnel and agents of the Manager in connection with the purchase, financing,
refinancing, sale or other disposition of an Investment;

11

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6.2.7.    costs and expenses incurred with respect to market information systems
and publications, research publications and materials, and settlement, clearing
and custodial fees and expenses to the extent used for the Company and approved
in advance by the Company;
6.2.8.    compensation and expenses of the Company’s custodian and transfer
agent, if any;
6.2.9.    the costs of maintaining compliance with all federal, state and local
rules and regulations or any other regulatory agency;
6.2.10.    all taxes and license fees;
6.2.11.    costs and expenses incurred in contracting with third parties,
including Affiliates of the Manager;
6.2.12.    all other costs and expenses relating to the Company’s business and
investment operations, including, without limitation, the costs and expenses of
acquiring, owning, protecting, maintaining, developing and disposing of
investments, including appraisal, reporting, audit and legal fees;
6.2.13.    expenses relating to any office(s) or office facilities, including
but not limited to disaster backup recovery sites and facilities, maintained for
the Company or its investments separate from the office or offices of the
Manager;
6.2.14.    expenses connected with the payments of interest, dividends or
distributions in cash or any other form authorized or caused to be made by the
Company or any Affiliate to or on account of holders of the Company’s securities
or of its Affiliates, including, without limitation, in connection with any
dividend reinvestment plan; and
6.2.15.    any judgment or settlement of pending or threatened proceedings
(whether civil, criminal or otherwise) against the Company, or against any
trustee, director, partner, member or officer of the Company in his or her
capacity as such for which the Company is required to indemnify such trustee,
director, partner, member or officer by any court or governmental agency.
6.3.    Expense Reports; Reimbursement to the Manager. The Manager shall prepare
a report documenting the reimbursable expenses incurred by the Manager on behalf
of the Company during each month, and shall deliver such statement to the
Company within fifteen (15) business days after the end of each calendar month.
Undisputed expenses incurred by the Manager on behalf of the Company shall be
reimbursed monthly to the Manager on the last day of the month in which such
report is properly submitted. In the event the Company and the Manager are
unable to reach agreement regarding any expenses submitted by the Manager
hereunder within 60 days following the Manager’s submission of such expenses
pursuant to this Section 6.3, the Company and the Manager agree to submit such
disputed expenses to a single, qualified and independent arbitrator, whose
appointment shall be agreed upon between the parties, or failing agreement
within fourteen (14) days, after either party has given to the other a written
request to concur in the appointment of an arbitrator, by an arbitrator to be
appointed by the President or a Vice President of the Chartered

12

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Institute of Arbitrators. The Company and the Manager hereby agree to evenly
split the cost associated with the appointment of any such arbitrator.
7.
Limits of Manager Responsibility.

The Manager assumes no responsibility under this Agreement other than to render
the services specifically called for under this Agreement and shall not be
responsible for any action of the Company in following or declining to follow
any advice or recommendations of the Manager, including as set forth in Section
2.2.2 of this Agreement. The Manager, its managers, officers, members and
employees will not be liable to the Company, any issuer of Investments, any
Affiliate of the Company, its stockholders or any of its Affiliate’s
stockholders or the Independent Directors for any acts or omissions, errors of
judgment or mistakes of law by the Manager, its managers, officers, members or
employees under or in connection with this Agreement, except by reason of acts
or omissions, errors of judgment or mistakes of law constituting willful
misconduct, gross negligence or fraud. The Company shall reimburse, indemnify
and hold harmless the Manager, its managers, officers, members and employees of
and from any and all expenses, losses, damages, liabilities, demands, charges
and claims of any nature whatsoever (including, without limitation, attorneys’
fees) in respect of or arising from any acts or omissions, errors of judgment or
mistakes of law of the Manager, its managers, officers, members and employees
made in the performance of the Manager’s duties under this Agreement or pursuant
to any underwriting agreement or similar agreement to which Manager is a party
in connection with any debt or equity sales of the Company’s securities and not
constituting willful misconduct, gross negligence or fraud. The Manager shall be
further indemnified by the Company as an agent of the Company to the maximum
extent permissible in accordance with the terms of the Company’s Governing
Instruments.
The Manager shall reimburse, indemnify and hold harmless the Company and its
Affiliates and their members, managers, directors, officers, employees and
stockholders (the “Company Indemnitees”) from any and all expenses, losses,
damages, liabilities, demands, charges and claims of any nature whatsoever
(including, without limitation, attorneys’ fees) in respect of or arising from
the Manager’s willful misconduct, gross negligence or fraud except where the
Company or any Company Indemnitee is guilty of willful misconduct, gross
negligence or fraud.
8.
No Joint Venture.

The Company and the Manager are not partners or joint venturers with each other,
and nothing in this Agreement shall be construed to make them such partners or
joint venturers or impose any liability as such on any of them. The Manager is
an independent contractor and, except as expressly provided or authorized in
this Agreement, shall have no authority to act for or represent the Company.
9.
Term; Renewal; Termination.

9.1.    Term. This Agreement shall commence on the Effective Date and shall
continue in force until the first anniversary of the Effective Date (the
“Initial Term”) and thereafter shall be automatically extended for additional
one (1) year terms (each, a “Renewal Term”) without further

13

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action unless one party delivers written notice of non-renewal (“Termination
Notice”) to the other party at least 180 days prior to the end of the
then-applicable term.
9.2.    Termination by the Manager.
9.2.1.    The Manager may terminate the Agreement if (i) the Company becomes an
investment company under the Investment Company Act or (ii) the Manager declines
to renew the Agreement by providing the Company with 180 days’ prior written
notice. In the event this Agreement is terminated pursuant to this Section
9.2.1, from and after the Termination Date, the Manager will not be entitled to
receive any compensation in accordance with the terms of this Agreement other
than compensation agreed upon by the Company and the Manager will be entitled to
receive compensation described herein relating to periods prior to the
Termination Date.
9.2.2.    The Manager may terminate the Agreement, if the Company has breached
this Agreement in any material respect, the Manager provides 30 days’ written
notice of such breach and the Company fails to cure such breach within 30 days
of receiving written notice. In the event this agreement is terminated pursuant
to this Section 9.2.2, the Manager is entitled to receive the compensation
herein described related to Investments sourced by the Manager until such
Investments are liquidated.
9.3.    Termination by Company for Cause. At the option of the Company, this
Agreement shall be and become terminated upon 30 days’ written notice of
termination from the Company to the Manager if any of the following events shall
occur (termination for any of such events shall constitute termination for
“Cause”):
9.3.1.    the Manager has breached this Agreement in any material respect and,
after written notice of such violation from the Company, the Manager has failed
to cure such breach within 30 days;
9.3.2.    the Manager engages in any act of fraud or embezzlement against the
Company,
9.3.3.    there is an event of any gross negligence or willful misconduct on the
part of the Manager in the performance of its duties under this Agreement that
is materially detrimental to the Company;
9.3.4.    the Manager dissolves (unless the Company has previously approved a
successor);
9.3.5.    if Mieko Willoughby ceases to be a full-time employee of the Manager
or its Affiliates (or any of its or their successors or assigns).
9.3.6.    the Manager undergoes a Change of Control without consent of the
Company; or
9.3.7.    there is entered an order for relief or similar decree or order with
respect to the Manager by a court having competent jurisdiction in an
involuntary case under the federal

14

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bankruptcy laws as now or hereafter constituted or under any applicable federal
or state bankruptcy, insolvency or other similar laws; or the Manager
(i) ceases, or admits in writing its inability, to pay its debts as they become
due and payable, or makes a general assignment for the benefit of, or enters
into any composition or arrangement with, creditors; (ii) applies for, or
consents (by admission of material allegations of a petition or otherwise) to
the appointment of a receiver, trustee, assignee, custodian, liquidator or
sequestrator (or other similar official) of the Manager or of any substantial
part of its properties or assets, or authorizes such an application or consent,
or proceedings seeking such appointment are commenced without such
authorization, consent or application against the Manager and continue
undismissed for 30 days; (iii) authorizes or files a voluntary petition in
bankruptcy, or applies for or consents (by admission of material allegations of
a petition or otherwise) to the application of any bankruptcy, reorganization,
arrangement, readjustment of debt, insolvency, dissolution, liquidation or other
similar law of any jurisdiction, or authorizes such application or consent, or
proceedings to such end are instituted against the Manager without such
authorization, application or consent and are approved as properly instituted
and remain undismissed for 30 days or result in adjudication of bankruptcy or
insolvency; or (iv) permits or suffers all or any substantial part of its
properties or assets to be sequestered or attached by court order and the order
remains undismissed for 30 days; provided, however, that in the event the
Manager becomes the subject of a case under federal bankruptcy or similar
federal or state laws and remains in possession of its property and continues to
operate its business (as a debtor in possession or otherwise), the Company shall
not have the option to terminate this Agreement unless the Independent Directors
determine in good faith that as a result of such proceeding the Manager cannot
reasonably be expected to fulfill its obligations under this Agreement. If any
of the events specified in this Section shall occur, the Manager shall give
prompt written notice thereof to the Company upon the happening of such event.
9.3.8.    In the event this Agreement is terminated pursuant to this Section
9.3, from and after the Termination Date, the Manager will not be entitled to
receive any compensation in accordance with the terms of this Agreement other
than compensation agreed upon by the Company and the Manager will be entitled to
receive compensation described herein relating to periods prior to the
Termination Date.
9.4.    Other Termination Provisions.
9.4.1.    Negative Return on Equity. In the event the Company realizes a
negative 15% return on Equity in any fiscal year, as defined in Section 5.2.1,
the Company may terminate the Agreement by written notice to the Manager within
180 days following the fiscal year in which such negative return was realized.
In the event this Agreement is terminated pursuant to this Section 9.4.1, from
and after the Termination Date, the Manager will not be entitled to receive any
compensation in accordance with the terms of this Agreement other than
compensation agreed upon by the Company and the Manager will be entitled to
receive compensation described herein relating to periods prior to the
Termination Date.
9.4.2.    Termination pursuant to Section 9.1 or Section 9.2.2. Notwithstanding
any provision to the contrary herein, in the event the Company terminates this
Agreement pursuant to Section 9.1 or the Manager terminates this Agreement
pursuant to Section 9.2.2. (each such termination a “Qualified Termination”),
the Manager shall continue to manage all Investments

15

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sourced by the Manager and held by the Company at time of Termination Notice
until such Investments are liquidated and to continue to be entitled to the
compensation described herein.
9.4.3.    Right of First Refusal Upon Termination. If this Agreement is
terminated pursuant to a Qualified Termination, the Manager shall have the
exclusive right of first refusal on an ongoing basis in accordance with of this
Section 9.4.3, to purchase or arrange for purchase any of the Investments, other
than investment-grade securities, that existed at the time of Termination Notice
(the “ROFR Investments”). Upon effectiveness of the foregoing sentence, in the
event the Company receives a bone fide third party offer to purchase any ROFR
Investment, the Company shall provide the Manager with written notice thereof
detailing the terms of such sale. The Manager shall have 180 days following
receipt of such written notice to exercise its right of first refusal and notify
the Company of its intent to purchase or arrange for purchase the subject ROFR
Investment and to close on the purchase of the subject ROFR Investment on the
same terms, time periods and conditions as set forth in the Company’s written
notice to the Manager. In the event the Manager fails to exercise its right of
first refusal and consummate a purchase the ROFR Investment within the time
period stipulated in the immediately preceding sentence, the Company may sell
the subject ROFR Investments to a third party on the same terms and conditions
as were set forth in the original notice to the Manager within 180 days after
the expiration of the aforesaid time period. If the Company does not sell the
ROFR Investments within such 180 day period, the Company shall again comply with
the terms hereof prior to any such sale of the ROFR Investments at a later date.
Any investments encumbered by a financing transaction with a maturity greater
than one year that are transferred to the lender in connection with a default
under such financing arrangement shall not be considered a ROFR Investment.
Notwithstanding any provision to the contrary in this Section 9.4.3, the Company
shall not solicit or accept any third party offers to purchase any ROFR
Investment that would cause the aggregate of such offers accepted and notified
to the Manager as above provided during any six (6) month period following the
time of Termination Notice to exceed fifty percent (50%) of the aggregate of the
ROFR Investments on the Termination Date.
10.
Assignments.

This Agreement shall terminate automatically in the event of its assignment, by
operation of law or otherwise, in whole or in part, by the Manager, unless such
assignment is consented to in writing by the Company with the consent of a
majority of the Independent Directors. Any such permitted assignment shall bind
the assignee under this Agreement in the same manner as the Manager is bound. In
addition, the assignee shall execute and deliver to the Company a counterpart of
this Agreement naming such assignee as Manager. This Agreement shall not be
assigned by the Company without the prior written consent of the Manager, except
in the case of assignment by the Company to an entity which is a successor (by
merger, consolidation or purchase of assets) to the Company, in which case such
successor organization shall be bound under this Agreement and by the terms of
such assignment in the same manner as the Company is bound under this Agreement.

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11.
Action Upon Termination.

Upon termination of this Agreement, the Manager shall forthwith:
11.1.    after deducting any accrued and earned compensation, including Base
Management Fees not subject to offset in accordance with Section 5.4, Incentive
Management Fees, Servicing Surveillance Fees, Ancillary Fees and reimbursement
for its expenses to which it is then entitled, pay over to the Company or any
subsidiary of the Company all money collected and held for the account of the
Company or any Affiliate of the Company pursuant to this Agreement;
11.2.    deliver to the Company a full accounting, including a statement showing
all payments collected by it and a statement of all money held by it, covering
the period following the date of the last accounting furnished to the Company or
any Affiliate of the Company; and
11.3.    deliver to the Company all property and documents of the Company or any
Affiliate of the Company then in the custody of the Manager.
12.
Release of Money or Other Property Upon Written Request.

The Manager agrees that any money or other property of the Company or any
Affiliate of the Company held by the Manager under this Agreement shall be held
by the Manager as custodian for the Company or such Affiliate, and the Manager’s
records shall be appropriately marked clearly to reflect the ownership of such
money or other property by the Company or such Affiliate. Upon the receipt by
the Manager of a written request signed by a duly authorized officer of the
Company requesting the Manager to release to the Company or any Affiliate of the
Company any money or other property then held by the Manager for the account of
the Company or any Affiliate of the Company under this Agreement, the Manager
shall release such money or other property to the Company or such Affiliate of
the Company within a reasonable period of time, but in no event later than the
later to occur of (i) three (3) business days following such request and (ii)
the earliest time following such request that remittance will not cause the
Manager to violate any law or breach any agreement to which it or the Company is
a party. The Manager shall not be liable to the Company, any Affiliates of the
Company, the Independent Directors, or the Company’s or its Affiliates’
stockholders for any acts performed or omissions to act by the Company or any
Affiliate of the Company in connection with the money or other property released
to the Company or any Affiliate of the Company in accordance with this Section
12 and not constituting willful misconduct, gross negligence or fraud. The
Company and any Affiliate of the Company shall indemnify the Manager, its
managers, officers, members and employees against any and all expenses, losses,
damages, liabilities, demands, charges and claims of any nature whatsoever
(including, without limitation, attorneys’ fees), which arise in connection with
the Manager’s release of such money or other property to the Company or any
Affiliate of the Company in accordance with the terms of this Section 12 unless
such expenses, losses, damages, liabilities, demands, charges and claims arise
in connection with acts or omissions which constitute willful misconduct, gross
negligence or fraud. Indemnification pursuant to this provision shall be in
addition to any right of the Manager to indemnification under Section 7 of this
Agreement.

17

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13.
Representations and Warranties.

13.1.    The Company in Favor of the Manager. The Company hereby represents and
warrants to the Manager as follows:
13.1.1.    Due Incorporation or Formation. The Company is duly organized,
validly existing and in good standing in the State of Delaware, and has the
power to own its assets and to transact the business in which it is engaged.
13.1.2.    Power and Authority. The Company has the power and authority to
execute, deliver and perform this Agreement and all obligations required under
this Agreement and has taken all necessary action to authorize this Agreement on
the terms and conditions hereof and the execution, delivery and performance of
this Agreement and all obligations required under this Agreement. Except as
shall have been obtained, no consent of any other person, including, without
limitation, stockholders, partners and creditors, as applicable, of the Company,
and no license, permit, approval or authorization of, exemption by, notice or
report to, or registration, filing or declaration with, any governmental
authority is required by the Company in connection with this Agreement or the
execution, delivery, performance, validity or enforceability of this Agreement
and all obligations required under this Agreement. This Agreement has been, and
each instrument or document required under this Agreement will be, executed and
delivered by a duly authorized officer of the Company, and this Agreement
constitutes, and each instrument or document required under this Agreement when
executed and delivered under this Agreement will constitute, the legally valid
and binding obligation of the Company enforceable against the Company in
accordance with its terms.
13.1.3.    Execution, Delivery and Performance. The execution, delivery and
performance of this Agreement and the documents or instruments required under
this Agreement will not violate any provision of any existing law or regulation
binding on the Company, or any order, judgment, award or decree of any court,
arbitrator or governmental authority binding on the Company, or the Governing
Instruments of, or any securities issued by, either of the Company or of any
mortgage, indenture, lease, contract or other agreement, instrument or
undertaking to which the Company is a party or by which the Company or any of
its assets may be bound, and will not result in, or require, the creation or
imposition of any lien on any of its property, assets or revenues pursuant to
the provisions of any such mortgage, indenture, lease, contract or other
agreement, instrument or undertaking.
13.2.    Manager In Favor of Company. The Manager hereby represents and warrants
to the Company as follows:
13.2.1.    Due Formation. The Manager is duly organized, validly existing and in
good standing under the laws of the State of California, has the limited
liability company power to own its assets and to transact the business in which
it is now engaged. The Manager does not do business under any fictitious
business name.
13.2.2.    Power and Authority. The Manager has the limited liability company
power and authority to execute, deliver and perform this Agreement and all
obligations required under this Agreement and has taken all necessary limited
liability company action to authorize this Agreement

18

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on the terms and conditions hereof and the execution, delivery and performance
of this Agreement and all obligations required under this Agreement. Except as
shall have been obtained, no consent of any other person including, without
limitation, members and creditors of the Manager, and no license, permit,
approval or authorization of, exemption by, notice or report to, or
registration, filing or declaration with, any governmental authority is required
by the Manager in connection with this Agreement or the execution, delivery,
performance, validity or enforceability of this Agreement and all obligations
required under this Agreement. This Agreement has been and each instrument or
document required under this Agreement will be executed and delivered by a duly
authorized officer of the Manager, and this Agreement constitutes, and each
instrument or document required under this Agreement when executed and delivered
under this Agreement will constitute, the legally valid and binding obligation
of the Manager enforceable against the Manager in accordance with its terms.
13.2.3.    Execution, Delivery and Performance. The execution, delivery and
performance of this Agreement and the documents or instruments required under
this Agreement will not violate any provision of any existing law or regulation
binding on the Manager, or any order, judgment, award or decree of any court,
arbitrator or governmental authority binding on the Manager, or the governing
instruments of, or any securities issued by, the Manager or of any mortgage,
indenture, lease, contract or other agreement, instrument or undertaking to
which the Manager is a party or by which the Manager or any of its assets may be
bound, and will not result in, or require, the creation or imposition of any
lien on any of its property, assets or revenues pursuant to the provisions of
any such mortgage indenture, lease, contract or other agreement, instrument or
undertaking.
14.
Notices.

Unless expressly provided otherwise in this Agreement, all notices, requests,
demands and other communications required or permitted under this Agreement
shall be in writing and shall be deemed to have been duly given, made and
received when (1) delivered by hand, (2) otherwise delivered against receipt
therefor, or (3) upon actual receipt of registered or certified mail, postage
prepaid, return receipt requested. The parties may deliver to each other notice
by electronically transmitted facsimile copies, provided that such facsimile
notice is followed within twenty-four (24) hours by any type of notice otherwise
provided for in this Section 14. Any notice shall be duly addressed to the
parties as follows:
(a)
If to the Company:

NYMT Loan Financing, LLC
765 Baywood Drive, Suite 340
Petaluma, CA 94954

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with a copy to:

New York Mortgage Trust, Inc.
275 Madison Avenue
New York, NY 10016
Attention: Steven Mumma
Email:    smumma@nymtrust.com

Vinson & Elkins LLP
2200 Pennsylvania Avenue NW
Suite 500 West
Washington D.C. 20037-1701
Attention: Christopher C. Green
Email:    cgreen@velaw.com

(b)
If to the Manager:

Headlands Asset Management, LLC
405 Park Avenue
New York, NY 10022
Attention: Mieko Willoughby
Email:    mieko.willoughby@headlands.us

Headlands Asset Management, LLC
765 Baywood Drive, Suite 340
Petaluma, CA 94954
Attention: Kristen Decker
Email: Kristen.decker@headlands.us

With a copy to:

Weintraub Tobin
475 Sansome Street, Suite 1800
San Francisco, CA 94111
Attention: Phil R. Pollock
Email: PPollock@weintraub.com

Any party may alter the address to which communications or copies are to be sent
by giving notice of such change of address in conformity with the provisions of
this Section 14 for the giving of notice.

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15.
Effective Date

The provisions set forth in this Agreement shall take effect as of July 1, 2016,
“the Effective Date”.
16.
Binding Nature of Agreement; Successors and Assigns.

This Agreement shall be binding upon and inure to the benefit of the parties
hereto and their respective heirs, personal representatives, successors and
assigns as provided in this Agreement.
17.
Entire Agreement.

This Agreement contains the entire agreement and understanding among the parties
hereto with respect to the subject matter hereof, and supersedes all prior and
contemporaneous agreements, understandings, inducements and conditions, express
or implied, oral or written, of any nature whatsoever with respect to the
subject matter hereof. The express terms hereof control and supersede any course
of performance and/or usage of the trade inconsistent with any of the terms
hereof. This Agreement may not be modified or amended other than by an agreement
in writing.
18.
Controlling Law.

This Agreement and all questions relating to its validity, interpretation,
performance and enforcement shall be governed by and construed, interpreted and
enforced in accordance with the laws of the State of New York, notwithstanding
any New York or other jurisdiction’s conflict of law provisions to the contrary.
19.
Indulgences, Not Waivers.

Neither the failure nor any delay on the part of a party to exercise any right,
remedy, power or privilege under this Agreement shall operate as a waiver
thereof, nor shall any single or partial exercise of any right, remedy, power or
privilege preclude any other or further exercise of the same or of any right,
remedy, power or privilege, nor shall any waiver of any right, remedy, power or
privilege with respect to any occurrence be construed as a waiver of such right,
remedy, power or privilege with respect to any other occurrence. No waiver shall
be effective unless it is in writing and is signed by the party asserted to have
granted such waiver.
20.
Titles Not to Affect Interpretation.

The titles of paragraphs and subparagraphs contained in this Agreement are for
convenience only, and they neither form a part of this Agreement nor are they to
be used in the construction or interpretation hereof.
21.
Execution in Counterparts.

This Agreement may be executed in any number of counterparts, each of which
shall be deemed to be an original as against any party whose signature appears
thereon, and all of which shall together constitute one and the same instrument.
This Agreement shall become binding when

21

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one or more counterparts hereof, individually or taken together, shall bear the
signatures of all of the parties reflected hereon as the signatories.
22.
Gender.

Words used herein regardless of the number and gender specifically used shall be
deemed and construed to include any other number, singular or plural, and any
other gender, masculine, feminine or neuter, as the context requires.
23.
Attorneys’ Fees.

Should any action or other proceeding be necessary to enforce any of the
provisions of this Agreement or the various transactions contemplated hereby,
the prevailing party will be entitled to recover its actual reasonable
attorneys’ fees and expenses from the non- prevailing party.
24.
Amendments.

This Agreement may not be amended, modified or changed (in whole or in part),
except by a formal, definitive written agreement expressly referring to this
Agreement, which agreement is executed by all of the parties. The parties hereto
expressly acknowledge that no consent or approval of the Company’s members is
required in connection with any amendment, modification or change to this
Agreement.
25.
Authority.

Each signatory to this Agreement warrants and represents that he is authorized
to sign on behalf of and to bind the party on whose behalf he, she or it is
signing.
[Signature Page Follows.]

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

Headlands Asset Management, LLC

By: _____________________________
Name:
Title:
   

NYMT Loan Financing, LLC

By:                            
Name:
Title:

23

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EXHIBIT A
Investment Guidelines
Capitalized terms used but not defined herein shall have the meanings ascribed
thereto in that certain Management Agreement, dated as of November 2, 2016, as
may be amended from time to time (the “Management Agreement”), by and between
NYMT Loan Financing, LLC., a Delaware limited liability company (the “Company”)
and Headlands Asset Management, LLC, a California limited liability company (the
“Manager”).
Guidelines
HEADLANDS'  PERFORMING LOAN INVESTMENT CRITERIA
 
 
 
 
CATEGORY:
INDIVIDUAL LOAN  TRAITS:
TARGETED POOL PROFILE:
EXCLUSIONS:
 
 
 
 
LIEN
IST LIEN RESIDENTIAL ONLY
IST LIEN RESIDENTIAL ONLY
NO 2ND LIENS
PRODUCT
JUMBO-A, ALT-A, SUBPRIME FIXED RATE, ADJUSTABLE RATE, BALLOONS
JUMBO-A, ALT-A, SUBPRIME FIXED RATE, ADJUSTABLE RATE, BALLOONS
NO OPTION ARMS OR HELOCs
OCCUPANCY
OWNER OCCUPIED, SECOND HOME, & INVESTOR
OWNER OCCUPIED; LIMITED SECOND HOME & INVESTOR
SECOND HOME & INVESTOR PROPERTIES REVIEWED SELECTIVELY
PROPERTY
SINGLE FAMILY, MULTI-FAMILY (1-4 UNITS), CONDOS
SINGLE FAMILY, MULTI-FAMILY (1-4 UNITS), CONDOS
NO MULTI FAMILY > 4-UNITS; NO FARMS; NO  PROPERTIES WITH COMMERCIAL USE; NO LAND
LOTS; NO LEASEHOLDS. COOPS AND MANUFACTURED HOMES ON EXCEPTION ONLY
PURPOSE
PURCHASE, CASH-OUT REFINANCES, RATE/TERM REFINANCES
PURCHASE, CASH-OUT REFINANCES, RATE/TERM REFINANCES
NO EXCLUSIONS
FICO SCORES
NO MINIMUM
NO EXCLUSIONS
NO EXCLUSIONS
LTV'S
ALL LTV'S ACCEPTABLE
NO EXCLUSIONS
NO EXCLUSIONS
GEOGRAPHY
NATIONAL
NATIONAL
NO EXCLUSIONS
MORTGAGOR
INDIVIDUAL BORROWERS
INDIVIDUAL BORROWERS
NO EXCLUSIONS
COUPON
ALL RATES
ALL RATES
LOWER RATES REVIEWED SELECTIVELY
BALANCES
BALANCES > $50,000 AND < $729,750
BALANCES > $50,000 AND < $729,750
LOWER BALANCES & HIGHER BALANCES REVIEWED SELECTIVELY
DTI
ALL DTI'S ACCEPTABLE
ALL DTI'S ACCEPTABLE
NO EXCLUSIONS
SERVICING
SERVICING RELEASED ONLY
SERVICING RELEASED ONLY
SERVICING RELEASED ONLY, SERVICING RETAINED ON EXCEPTION ONLY
DELINQUENCY
PERFORMING/SUBPERFORMING ONLY
PERFORMING/SUBPERFORMING ONLY
NO EXCLUSIONS
BANKRUPTCIES
SELECTIVELY REVIEWED
SELECTIVELY REVIEWED
SELECTIVELY REVIEWED
FORECLOSURES
PREVIOUS FORECLOSURES REVIEWED SELECTIVELY
PREVIOUS FORECLOSURES REVIEWED SELECTIVELY
PREVIOUS FORECLOSURES REVIEWED SELECTIVELY
MODIFICATIONS
ACCEPTABLE WITH REVIEW
MINIMUM SEASONING OF AT LEAST 6 MONTHS WITH TIMELY PAYMENTS POST THE
MODIFICATION DATE
LOANS WITH DELINQUENCIES AFTER A LOAN MODIFICATION WILL BE REVIEWED SELECTIVELY

A-1

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EXHIBIT B

Section 5.3.1 Incentive Management Fee
At the end of each calendar quarter, the following example calculation will be
made:
Calculation Period: January 1st, 2013 through March 31st, 2013
Average amount of Equity during the Calculation Period: $100 million
Adjusted Net Income during the Calculation Period: $3,750,000
Hurdle Rate: 12% per annum
Amount required to meet Hurdle Rate: ( $100 million X 12%- ) divided by 4
(quarterly) = $3,000,000
Incentive Fee: Adjusted Net Income -less Hurdle Rate Amount = $750,000 X 35% =
$262,500
5.3.2 High Water Mark
Measurement Period = The Measurement Period is the previous 12 calendar months
Average Equity previous calendar year look back period = $100 million
Average Equity during the previous quarter (Calculation Period) = $100 million
Total Adjusted Net Income over the preceding calendar year = $3 million
Total Adjusted Net Income during the preceding quarter = $5.5 million
High Water Mark for Measurement Period = 5.00% annual rate X $100 million
average Equity invested = $5 million
High Water Mark shortfall = $5 million less $3 million = $2 million shortfall
Adjusted Net Income for Calculation Period- = $5.5 million less $2 million =
$3.5 million
Hurdle Rate: 12% per annum
Amount Required to meet Hurdle Rate: ( $100 million X 12% ) divided by 4
(quarterly) = $3.0 million
Adjusted Net Income less Hurdle return = $3.5 million less $3.0 million =
$500,000
Incentive Fee = $500,000 X 35% Manager Split = $175,000

B-1

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EXHIBIT C
64065.000001 EMF_US 43110248v1
#
Report Name
Delivery Time Period
1
Monthly warehouse schedules showing end of month interest bearing UPB by loan
5th business day after month end
2
Monthly collections detail
5th business day after month end
3
Monthly roll forward of interest bearing UPB
5th business day after month end
4
Monthly detail of loan modifications
5th business day after month end
5
All signed borrower modification documents
5th business day after month end
6
Schedule showing all new REOs
5th business day after month end
7
All REO documents that have been received from foreclosure attorneys
5th business day after month end
8
Month end corp advance roll forward that rolls with reconciling items classified
5th business day after month end
9
Month end escrow roll forward that rolls with reconciling items classified
2 weeks after month end
10
Monthly ending add-on balance detail that ties back to monthly Headlands trial
balance without reconciling items
2 weeks after month end
11
Monthly ending deferred balance detail that ties back to monthly Headlands trial
balance without reconciling items
2 weeks after month end
 
 
 
 
 
 
12
Monthly NYBidTapeReport file showing loan population and details at month end
1 Day after month end
13
Monthly entity level trial balances, discount amortization reports, and
transaction journals.
3 weeks after month end
14
Purchase price allocation
Within 10 days of purchase, no later than 5th business day after month end
15
Reimbursable expenses at month end in excel (including breakout of expenses to
be capitalized by loan, and those to be expensed as incurred)
5th business day after quarter end

C-1