Exhibit 10.2(2)

 

EXECUTION VERSION

 

CREDIT SUISSE, NEW YORK BRANCH

 

November 8, 2005

 

Fieldstone Investment Corporation
Fieldstone Mortgage Company
11000 Broken Land Parkway
Suite 600
Columbia, MD  21044

 

Attention: Mark C. Krebs

 

Re:  Pricing Side Letter

 

Ladies and Gentlemen:

 

Reference is hereby made to, and this side letter (the “Pricing Side Letter”) is
hereby incorporated by reference into, the Master Repurchase Agreement, dated as
of November 8, 2005, (as amended, supplemented and otherwise modified from time
to time, the “Agreement”), among Fieldstone Investment Corporation (a “Seller”),
Fieldstone Mortgage Company (a “Seller”) and Credit Suisse, New York Branch (the
“Administrative Agent”).  Any capitalized term used but not defined herein shall
have the meaning assigned to such term in the Agreement.

 

Section 1.  Definitions.  The following terms shall have the meanings set forth
below.

 

1.1          “Asset Value” shall mean with respect to each Eligible Mortgage
Loan, the lesser of (a) the applicable Purchase Price Percentage for the related
Purchased Mortgage Loan multiplied by the Market Value of such Mortgage Loan and
(b) the outstanding principal balance of such Mortgage Loan.  Without limiting
the generality of the foregoing, the Sellers acknowledge that the Asset Value of
a Purchased Mortgage Loan may be reduced to zero by Administrative Agent if:

 

(i)            a material breach of a representation, warranty or covenant made
by Seller in this Agreement with respect to such Purchased Mortgage Loan has
occurred and is continuing;

 

(ii)           such Purchased Mortgage Loan is a Defaulted Mortgage Loan;

 

(iii)          such Purchased Mortgage Loan has been released from the
possession of the Custodian under the Custodial Agreement for a period in excess
of ten (10) Business Days;

 

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(iv)          such Purchased Mortgage Loan has been subject to a Transaction
hereunder for a period of greater than 180 days;

 

(v)           such Purchased Mortgage Loan is a Wet-Ink Mortgage Loan for which
the Mortgage File has not been delivered to the Custodian on or prior to the
fifth Business Day after the related Purchase Date;

 

(vi)          such Purchased Mortgage Loan is no longer acceptable for purchase
by any Buyer (or an Affiliate thereof) or the Administrative Agent (or an
Affiliate thereof) under any of the flow purchase or conduit programs for which
Seller then has been approved due to a Requirement of Law relating to consumer
credit laws or otherwise;

 

(vii)         when the Purchase Price for such Purchased Mortgage Loan is added
to other Purchased Mortgage Loans, the Weighted Average Mortgage Interest Rate
of all Fixed Rate Mortgage Loans is less than 7.5%;

 

(viii)        when the Purchase Price for such Purchased Mortgage Loan is added
to other Purchased Mortgage Loans, the Weighted Average Mortgage Interest Rate
of all Floating Rate Mortgage Loans is less than 7%;

 

(ix)           when the Purchase Price for such Purchased Mortgage Loan is added
to other Purchased Mortgage Loans, the Weighted Average FICO Score of all Fixed
Rate Mortgage Loans is less than 675;

 

(x)            when the Purchase Price for such Purchased Mortgage Loan is added
to other Purchased Mortgage Loans, the Weighted Average FICO Score of all
Floating Rate Mortgage Loans is less than 630;

 

(xi)           when the Purchase Price for such Purchased Mortgage Loan is added
to other Purchased Mortgage Loans, the Outstanding Principal Balance of all
Fixed Rate Mortgage Loans having FICO Scores that are less than or equal to 500
is greater than 1% of the Outstanding Principal Balance of all Fixed Rate
Mortgage Loans;

 

(xii)          when the Purchase Price for such Purchased Mortgage Loan is added
to other Purchased Mortgage Loans, the Outstanding Principal Balance of all
Floating Rate Mortgage Loans having FICO Scores that are less than or equal to
500 is greater than 0.50% of the Outstanding Principal Balance of all Floating
Rate Mortgage Loans;

 

(xiii)         when the Purchase Price for such Purchased Mortgage Loan is added
to other Purchased Mortgage Loans, the Outstanding Principal Balance of all
Fixed Rate Mortgage Loans having FICO Scores that are less than or equal to 550
is greater than 3% of the Outstanding Principal Balance of all Fixed Rate
Mortgage Loans;

 

(xiv)        when the Purchase Price for such Purchased Mortgage Loan is added
to other Purchased Mortgage Loans, the Outstanding Principal Balance of all
Floating Rate Mortgage Loans having FICO Scores that are less than or equal to
550 is greater than 15% of the Outstanding Principal Balance of all Floating
Rate Mortgage Loans;

 

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(xv)         when the Purchase Price for such Purchased Mortgage Loan is added
to other Purchased Mortgage Loans, the Outstanding Principal Balance of all
Fixed Rate Mortgage Loans having FICO Scores that are less than or equal to 600
is greater than 10% of the Outstanding Principal Balance of all Fixed Rate
Mortgage Loans;

 

(xvi)        when the Purchase Price for such Purchased Mortgage Loan is added
to other Purchased Mortgage Loans, the Outstanding Principal Balance of all
Floating Rate Mortgage Loans having FICO Scores that are less than or equal to
600 is greater than 30% of the Outstanding Principal Balance of all Floating
Rate Mortgage Loans;

 

(xvii)       when the Purchase Price for such Purchased Mortgage Loan is added
to other Purchased Mortgage Loans, the Weighted Average LTV of all Fixed Rate
Mortgage Loans is greater than or equal to 87%;

 

(xviii)      when the Purchase Price for such Purchased Mortgage Loan is added
to other Purchased Mortgage Loans, the Weighted Average LTV of all Floating Rate
Mortgage Loans is greater than or equal to 85%;

 

(xix)         when the Purchase Price for such Purchased Mortgage Loan is added
to other Purchased Mortgage Loans, the Outstanding Principal Balance of all
Fixed Rate Mortgage Loans having an LTV that is greater than or equal to 95% but
less than or equal to 100% is greater than or equal to 40% of the Outstanding
Principal Balance of all Fixed Rate Mortgage Loans;

 

(xx)          when the Purchase Price for such Purchased Mortgage Loan is added
to other Purchased Mortgage Loans, the Outstanding Principal Balance of all
Floating Rate Mortgage Loans having an LTV that is greater than or equal to 95%
but less than or equal to 100% is greater than or equal to 15% of the
Outstanding Principal Balance of all Floating Rate Mortgage Loans;

 

(xxi)         when the Purchase Price for such Purchased Mortgage Loan is added
to other Purchased Mortgage Loans, the Weighted Average CLTV of all Fixed Rate
Mortgage Loans is greater than or equal to 95%;

 

(xxii)        when the Purchase Price for such Purchased Mortgage Loan is added
to other Purchased Mortgage Loans, the Weighted Average CLTV of all Floating
Rate Mortgage Loans is greater than or equal to 95%;

 

(xxiii)       when the Purchase Price for such Purchased Mortgage Loan is added
to other Purchased Mortgage Loans, the Outstanding Principal Balance of all
Fixed Rate Mortgage Loans having a CLTV that is greater than or equal to 95% but
less than or equal to 100% is greater than or equal to 40% of the Outstanding
Principal Balance of all Fixed Rate Mortgage Loans;

 

(xxiv)       when the Purchase Price for such Purchased Mortgage Loan is added
to other Purchased Mortgage Loans, the Outstanding Principal Balance of all
Floating Rate Mortgage Loans having a CLTV that is greater than or equal to 95%
but less than or

 

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equal to 100% is greater than or equal to 60% of the Outstanding Principal
Balance of all Floating Rate Mortgage Loans;

 

(xxv)        when the Purchase Price for such Purchased Mortgage Loan is added
to other Purchased Mortgage Loans, the Outstanding Principal Balance of all
Fixed Rate Mortgage Loans having an original Outstanding Principal Balance that
is less than or equal to $50,000 is greater than or equal to 20% of the
Outstanding Principal Balance of all Fixed Rate Mortgage Loans;

 

(xxvi)       when the Purchase Price for such Purchased Mortgage Loan is added
to other Purchased Mortgage Loans, the Outstanding Principal Balance of all
Floating Rate Mortgage Loans having an original Outstanding Principal Balance
that is less than or equal to $50,000 is greater than or equal to 5% of the
Outstanding Principal Balance of all Floating Rate Mortgage Loans;

 

(xxvii)      when the Purchase Price for such Purchased Mortgage Loan is added
to other Purchased Mortgage Loans, the Outstanding Principal Balance of all
Fixed Rate Mortgage Loans having an original Outstanding Principal Balance that
is less than or equal to $100,000 is greater than or equal to 45% of the
Outstanding Principal Balance of all Fixed Rate Mortgage Loans;

 

(xxviii)     when the Purchase Price for such Purchased Mortgage Loan is added
to other Purchased Mortgage Loans, the Outstanding Principal Balance of all
Floating Rate Mortgage Loans having an original Outstanding Principal Balance
that is less than or equal to $100,000 is greater than or equal to 10% of the
Outstanding Principal Balance of all Floating Rate Mortgage Loans;

 

(xxix)       when the Purchase Price for such Purchased Mortgage Loan is added
to other Purchased Mortgage Loans, the Outstanding Principal Balance of all
Fixed Rate Mortgage Loans having a Credit Grade of “A” is less than 95% of the
Outstanding Principal Balance of all Fixed Rate Mortgage Loans;

 

(xxx)        when the Purchase Price for such Purchased Mortgage Loan is added
to other Purchased Mortgage Loans, the Outstanding Principal Balance of all
Floating Rate Mortgage Loans having a Credit Grade of “A” is less than 90% of
the Outstanding Principal Balance of all Floating Rate Mortgage Loans;

 

(xxxi)       when the Purchase Price for such Purchased Mortgage Loan is added
to other Purchased Mortgage Loans, the Outstanding Principal Balance of all
Fixed Rate Mortgage Loans having a Credit Grade of “D” is greater than 0.50% of
the Outstanding Principal Balance of all Fixed Rate Mortgage Loans;

 

(xxxii)      when the Purchase Price for such Purchased Mortgage Loan is added
to other Purchased Mortgage Loans, the Outstanding Principal Balance of all
Floating Rate Mortgage Loans having a Credit Grade of “D” is greater than 1% of
the Outstanding Principal Balance of all Floating Rate Mortgage Loans;

 

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(xxxiii)     when the Purchase Price for such Purchased Mortgage Loan is added
to other Purchased Mortgage Loans, the Outstanding Principal Balance of all
Fixed Rate Mortgage Loans with respect to which the related Mortgagors have
provided Full Documentation is less than or equal to 55% of the Outstanding
Principal Balance of all Fixed Rate Mortgage Loans;

 

(xxxiv)     when the Purchase Price for such Purchased Mortgage Loan is added to
other Purchased Mortgage Loans, the Outstanding Principal Balance of all
Floating Rate Mortgage Loans with respect to which the related Mortgagors have
provided Full Documentation is less than or equal to 40% of the Outstanding
Principal Balance of all Floating Rate Mortgage Loans;

 

(xxxv)      when the Purchase Price for such Purchased Mortgage Loan is added to
other Purchased Mortgage Loans, the Outstanding Principal Balance of all Fixed
Rate Mortgage Loans with respect to which the related Mortgagors are required to
pay interest only on scheduled payment dates for a particular period of time
(and which period of time has not ended) is greater than or equal to 10% of the
Outstanding Principal Balance of all Fixed Rate Mortgage Loans;

 

(xxxvi)     when the Purchase Price for such Purchased Mortgage Loan is added to
other Purchased Mortgage Loans, the Outstanding Principal Balance of all
Floating Rate Mortgage Loans with respect to which the related Mortgagors are
required to pay interest only on scheduled payment dates for a particular period
of time (and which period of time has not ended) is greater than or equal to 75%
of the Outstanding Principal Balance of all Floating Rate Mortgage Loans;

 

(xxxvii)    when the Purchase Price for such Purchased Mortgage Loan is added to
other Purchased Mortgage Loans, the Outstanding Principal Balance of all Fixed
Rate Mortgage Loans with respect to which the related Mortgagor occupies the
related Mortgaged Property is less than 93% of the Outstanding Principal Balance
of all Fixed Rate Mortgage Loans;

 

(xxxviii)   when the Purchase Price for such Purchased Mortgage Loan is added to
other Purchased Mortgage Loans, the Outstanding Principal Balance of all
Floating Rate Mortgage Loans with respect to which the related Mortgagor
occupies the related Mortgaged Property is less than 90% of the Outstanding
Principal Balance of all Floating Rate Mortgage Loans;

 

(xxxix)      when the Purchase Price for such Purchased Mortgage Loan is added
to other Purchased Mortgage Loans, the Outstanding Principal Balance of all
Fixed Rate Mortgage Loans with respect to which the related Mortgaged Property
is designated for single-family use is less than 65% of the Outstanding
Principal Balance of all Fixed Rate Mortgage Loans;

 

(xl)           when the Purchase Price for such Purchased Mortgage Loan is added
to other Purchased Mortgage Loans, the Outstanding Principal Balance of all
Floating Rate Mortgage Loans with respect to which the related Mortgaged
Property is designated for

 

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single-family use is less than 65% of the Outstanding Principal Balance of all
Floating Rate Mortgage Loans;

 

(xli)          when the Purchase Price for such Purchased Mortgage Loan is added
to other Purchased Mortgage Loans, the Outstanding Principal Balance of all
Fixed Rate Mortgage Loans with respect to which the related Mortgaged Property
is designated for other than single-family use is greater than 35% of the
Outstanding Principal Balance of all Fixed Rate Mortgage Loans;

 

(xlii)         when the Purchase Price for such Purchased Mortgage Loan is added
to other Purchased Mortgage Loans, the Outstanding Principal Balance of all
Floating Rate Mortgage Loans with respect to which the related Mortgaged
Property is designated for other than single-family use is greater than 35% of
the Outstanding Principal Balance of all Fixed Rate Mortgage Loans;

 

(xliii)        when the Purchase Price for such Purchased Mortgage Loan is added
to other Purchased Mortgage Loans, the Outstanding Principal Balance of all
Fixed Rate Mortgage Loans that are also Second Lien Mortgage Loans is greater
than 40% of the Outstanding Principal Balance of all Fixed Rate Mortgage Loans;

 

(xliv)       such Purchased Mortgage Loan is a Floating Rate Mortgage Loan that
is also a Second Lien Mortgage Loan;

 

(xlv)        when the Purchase Price for such Purchased Mortgage Loan is added
to other Purchased Mortgage Loans, the Outstanding Principal Balance of all
Fixed Rate Mortgage Loans with respect to which the related Mortgaged Property
is located in the State of California is greater than 42% of the Outstanding
Principal Balance of all Fixed Rate Mortgage Loans;

 

(xlvi)       when the Purchase Price for such Purchased Mortgage Loan is added
to other Purchased Mortgage Loans, the Outstanding Principal Balance of all
Floating Rate Mortgage Loans with respect to which the related Mortgaged
Property is located in the State of California is greater than 55% of the
Outstanding Principal Balance of all Floating Rate Mortgage Loans;

 

(xlvii)      when the Purchase Price for such Purchased Mortgage Loan is added
to other Purchased Mortgage Loans, the Outstanding Principal Balance of all
Fixed Rate Mortgage Loans with respect to which the related Mortgaged Property
is located in a particular state of the United States or the District of
Columbia (other than the State of California) is greater than 12% of the
Outstanding Principal Balance of all Fixed Rate Mortgage Loans;

 

(xlviii)     when the Purchase Price for such Purchased Mortgage Loan is added
to other Purchased Mortgage Loans, the Outstanding Principal Balance of all
Floating Rate Mortgage Loans with respect to which the related Mortgaged
Property is located in a particular state of the United States or the District
of Columbia (other than the State of California) is greater than 15% of the
Outstanding Principal Balance of all Floating Rate Mortgage Loans;

 

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(xlix)        when the Purchase Price for such Purchased Mortgage Loan is added
to other Purchased Mortgage Loans, the aggregate Purchase Price of all Fixed
Rate Mortgage Loans that are Purchased Mortgage Loans exceeds 50% of the
Outstanding Principal Balance of all Purchased Mortgage Loans; or

 

(l)            when the Purchase Price for such Purchased Mortgage Loan is added
to other Purchased Mortgage Loans, the aggregate Purchase Price of all Wet-Ink
Mortgage Loans that are Purchased Mortgage Loans exceeds the greater of (i) 20%
of the Facility Outstanding Principal and (ii) $100 million.

 

1.2          “Administrative Fee” shall mean on each Price Differential Payment
Date with respect to the immediately preceding calendar month, the Seller agrees
to pay to the Administrative Agent, for its own account in accordance with the
Repurchase Agreement, a fee (the “Administrative Fee”) equal to the product of
(i) 0.02% per annum multiplied by (ii) the weighted average daily Facility
Outstanding Principal for such calendar month.

 

1.3          “Maximum Aggregate Purchase Price” shall mean, SIX HUNDRED MILLION
DOLLARS ($600,000,000); provided that such amount may not at any time exceed the
Maximum Committed Purchase Price then in effect.

 

1.4          “Maximum Group Purchase Price” shall mean (i) in the case of the
Buying Group related to the Administrative Agent and Alpine, SIX HUNDRED MILLION
DOLLARS ($600,000,000) and (ii) in the case of any other Buying Group, such
amount as is specified in the related assumption agreement or other agreement
pursuant to which the Persons in such Buying Group become parties to the
Repurchase Agreement and assume all of the rights and obligations, as
applicable, of “Committed Buyers” and “Conduit Buyers” hereunder.

 

1.5          “Non-Utilization Fee” shall mean, on each Price Differential
Payment Date with respect to the immediately preceding calendar month, the
Sellers agree to pay to the Administrative Agent, in accordance with the
Repurchase Agreement, a fee (the “Non-Utilization Fee”) equal to the product of
(i) 0.125% per annum multiplied by (ii) the difference between such Buying
Group’s weighted average daily Maximum Group Purchase Price for such calendar
month and such Buying Group’s aggregate pro rata share of the weighted average
daily Facility Outstanding Principal for such calendar month.

 

1.6          “Post Default Rate” shall mean an annual rate of interest equal to
the greater of (a) the Pricing Rate plus 4% or (b) the Mortgage Interest Rate.

 

1.7          “Pricing Rate” shall mean LIBOR plus:

 

(a)           0.23% with respect to Transactions the subject of which are
Purchased Mortgage Loans (other than Wet-Ink Mortgage Loans); and

 

(b)           0.43% with respect to Transactions the subject of which are
Wet-Ink Mortgage Loans.

 

The Pricing Rate shall change in accordance with LIBOR, as provided in
Section 5(a).

 

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1.8          “Purchase Price Percentage” shall mean, with respect to each
Mortgage Loan, 92.5%.

 

1.9          “Termination Date” shall mean the earliest of (i) the Business Day
designated by the Sellers to the Administrative Agent as the Termination Date at
any time following thirty (30) days’ written notice to the Administrative Agent,
(ii) the day upon which a Termination Date is declared or automatically occurs
relating to an Event of Default pursuant to Section 15 hereof, or (iii) July 26,
2006.

 

Section 2.  Computations.  The Non-Utilization Fee and the Administration Fee
shall be computed on the basis of the actual number of calendar days in the
related calendar month elapsed in a year of 360 days.

 

Section 3.  Fees.  The Sellers agree to pay as and when billed by the
Administrative Agent all of the reasonable fees, disbursements and expenses of
counsel to the Administrative Agent and Buyers in connection with the
development, preparation and execution of this Pricing Side Letter or any other
documents prepared in connection herewith in accordance with Sections 13 and 27
of the Agreement and receipt of payment thereof shall be a condition precedent
to the Buyer entering into any Transaction pursuant hereto.

 

Section 4.  GOVERNING LAW. THIS PRICING SIDE LETTER 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.

 

Section 5.  Counterparts.  This Pricing Side Letter may be executed in one or
more counterparts and by different parties hereto on separate counterparts, each
of which, when so executed, shall constitute one and the same agreement.

 

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IN WITNESS WHEREOF, the Sellers and the Administrative Agent have caused their
names to be signed hereto by their respective officers thereunto duly authorized
as of the date first above written.

 

 

Credit Suisse, New York Branch, as
Administrative Agent

 

 

 

 

 

By:

 

 

 

 

 

 

Name:

 

 

 

 

 

 

 

Title:

 

 

 

 

 

 

 

 

By:

 

 

 

 

 

 

Name:

 

 

 

 

 

 

 

Title:

 

 

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Fieldstone Mortgage Company, as Seller

 

 

 

 

 

By:

 

 

 

 

 

 

Name:

 

 

 

 

 

 

 

Title:

 

 

 

 

 

 

 

 

 

 

Fieldstone Investment Corporation, as Seller

 

 

 

 

 

By:

 

 

 

 

 

 

Name:

 

 

 

 

 

 

 

Title:

 

 

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