Exhibit 10.1

 

4/05 AMENDMENT TO CREDIT AGREEMENT

 

Preamble

 

This 4/05 Amendment to Credit Agreement (the “4/05 Amendment” or, within itself,
this “Amendment”) dated as of April 20, 2005 amending (for the first time) the
4/04 Amended and Restated Senior Secured Credit Agreement dated April 21, 2004
(the “4/04 A&R Credit Agreement”, and, as it may be supplemented, further
amended or restated from time to time, the “Current Credit Agreement”), among
FIELDSTONE INVESTMENT CORPORATION (“FIC”), a Maryland corporation and FIELDSTONE
MORTGAGE COMPANY (the “Company”), a Maryland corporation, each having its
principal office at 11000 Broken Land Parkway, Columbia, Maryland 21044 (FIC and
the Company are sometimes collectively called the “Borrowers” and individually
called a “Borrower”), and JPMORGAN CHASE BANK, N.A., (“JPMorgan” or the
“Lender”), a national banking association and successor to JPMorgan Chase Bank,
a New York banking corporation, having a branch at 712 Main Street, Houston,
Texas 77002, recites and provides as follows.

 

Recitals

 

The Borrowers have asked the Lender to (i) extend the Maturity Date from April
20, 2005 to April 19, 2006; (ii) reduce the Committed Sum to $150,000,000; (iii)
allow Borrowers to incur Debt and contingent liabilities in the form of
Permitted Guarantees; (iv) modify the interest rates; (v) decrease the Facility
Fee; (vi) increase the limit on conditional repurchase, indemnity or other
recourse obligations from $3,000,000 to $10,000,000; (vii) increase the
materiality limits on certain Events of Default from $2,500,000 to $10,000,000;
(viii) revise the GAAP net income requirement to allow for hedge fluctuations;
and (ix) to correct certain scriveners errors and the Lender has agreed to do so
on the terms and subject to the conditions of this Amendment.

 

All capitalized terms used in the 4/04 A&R Credit Agreement and used but not
defined differently in this Amendment have the same meanings here as there.

 

The numbered Sections of this Amendment are numbered to correspond with the
numbers of the Sections of the 4/04 A&R Credit Agreement amended hereby and are
accordingly often nonsequential.

 

In the event of a conflict between the foregoing recitals and the following
agreements, the latter will govern and control.

 

Agreements

 

In consideration of the premises, the mutual agreements stated below and other
good and valuable consideration paid by each party to each other party to this
Agreement, the receipt and sufficiency of which each hereby acknowledges, the
parties hereby agree as follows.

 

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1.             DEFINITIONS

1.2.          DEFINITIONS OF GENERAL APPLICATION.

 

A.  The following new definitions are hereby added to the 4/04 A&R Credit
Agreement, in alphabetical order:

 

“4/05 Amendment” means the 4/05 Amendment to Credit Agreement dated as of April
20, 2005 between the Borrowers and the Lender.

 

“4/05 Amendment Effective Date” means April 20, 2005, the effective date of the
4/05 Amendment.

 

“Permitted Guarantees” shall mean (a) mortgage repurchase and warehouse
facilities whereby the Borrowers are jointly and severally liable thereunder;
(b) mortgage repurchase and warehouse facilities whereby FIC guarantees the
obligations of the Company thereunder; and (c) obligations of the Borrower
pursuant to surety bonds required in connection with state licensing of branch
offices

 

B.  The following definitions are hereby amended in their entirety to henceforth
read as follows:

 

“Change of Control” means any event after which:

 

(i)            with respect to FIC (a) any Person shall have acquired beneficial
ownership (within the meaning of Rule 13d-3 of the Securities and Exchange
Commission under the Exchange Act except that for purposes of this definition, a
Person shall not be deemed to have acquired beneficial ownership of securities
tendered pursuant to a tender or exchange offer made by or on behalf of such
Person until such tendered securities are accepted for purchase or exchange),
directly or indirectly, of either (i) Voting Stock of FIC (or other securities
convertible into such Voting Stock) representing more than fifteen percent (15%)
of the combined voting power of all Voting Stock of FIC or (ii) more than
fifteen percent (15%) of the outstanding shares of any class or series of
capital stock of FIC; or (b) any Person shall have succeeded in having so many
of such Person’s nominees elected to the board of directors of FIC that such
nominees, when added to any existing directors remaining on the board of
directors of FIC after such election who were previously nominated by or are
Affiliates of such Person, comprise a majority of the board of directors of FIC;
or

 

(ii)           with respect to the Company, all of the Capital Stock of the
Company is not directly or indirectly owned by FIC or a wholly-owned Subsidiary
of FIC.

 

“Committed Sum” means, for any day, the maximum amount the Lender is committed
on that day to lend to the Borrowers (or for their accounts) on a

 

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revolving credit basis pursuant to this Agreement, on its terms and subject to
its conditions.  From the 4/05 Amendment Effective Date through and including
the Termination Date or such other date (if any) when it is changed by written
agreement of the Lender, FIC and the Company or by any Legal Requirement, the
Committed Sum is One Hundred Fifty Million Dollars ($150,000,000).

 

“Custodian” means JPMorgan Chase, as Custodian under the Custody Agreement, or
any successor custodian under the Custody Agreement or any successor Custody
Agreement.

 

“Custody Agreement” means the 4/04 Custody Agreement dated as of April 21, 2004
between the Borrowers and JPMorgan Chase, as Custodian, as it may hereafter be
supplemented, amended or restated from time to time, or any successor Custody
Agreement.

 

“Maturity Date” means April 19, 2006, or the earlier date (the “Acceleration
Date”), if any, when the Lender accelerates maturity of the Senior Credit Note
pursuant to this Agreement, or the maturity of the Senior Credit Note is
effectively accelerated by order of any Governmental Authority or by operation
of law.

 

“Total Liabilities” means all liabilities of FIC and its consolidated
Subsidiaries including Debt incurred and outstanding in connection with a
Permitted Securitization, in accordance with GAAP, as reflected on FIC’s
consolidated balance sheet.

 

1.3.          DEFINITIONS FOR INTEREST CALCULATIONS.

 

A.  The following definitions are hereby amended in their entirety to henceforth
read as follows:

 

“Margin” means the interest rate margin to be added (or subtracted as the case
may be) to a specified Index to determine a Rate.  The margins used in this
Agreement are:

 

(a)           the “Alternate Base Rate Margin”, which is applicable to Advances
for each Class of Borrowings in the Alternate Base Rate Tranche (if any)
outstanding on any day;

 

(b)           the “Balances Equivalent Margin”, which is applicable to Advances
for each Class of Borrowings in the Balances Equivalent Tranche (if any)
outstanding on any day; and

 

(c)           the “LIBOR Margin”, which is applicable to Advances for each Class
of Borrowings in the Base Rate Tranche (if any) outstanding on any day.

 

For outstanding Advances of the type that is described on a row in the first

 

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column of the following table, the applicable interest rate margins are as
stated on the same row:

 

Type of Advance/Margin

 

Balances
Equivalent Margin

 

LIBOR
Margin

 

Alternate Base
Rate Margin

 

Single-family Advances that are not Wet Warehousing Advances, Subprime Loan
Advances, Second Lien Loan Advances or Repurchased Loan Advances

 

0.90

%

0.90

%

(0.10

)%

Single-family Warehouse Advances that are Wet Warehousing Advances, Subprime
Loan Advances, Second Lien Loan Advances or Repurchased Loan Advances

 

1.00

%

1.00

%

0.00

%

 

“Rate” means an interest rate applicable to a Class of Borrowings in a Tranche. 
Each Rate is stated as an annual percentage rate and, except for the Ceiling
Rate, is the sum of an Index and a Margin.  The Rates used in this Agreement
are:

 

(a)           the “Alternate Base Rate”, which for each day of the Interest
Period applicable to the Alternate Base Rate Tranche (if any), is a rate per
annum equal to the lesser of:

 

(i)            the Prime Rate in effect on that day plus or minus (as the case
may be) the Alternate Base Rate Margin for each Class of Borrowings in the
Alternate Base Rate Tranche (if any), rounded upwards, if necessary, to the
nearest one-eighth percent (0.125%); and

 

(ii)           the Ceiling Rate for that day;

 

with any change in the Alternate Base Rate due to a change in the Prime Rate
being effective on the effective date of such change in the Prime Rate;

 

(b)           the “Ceiling Rate” which means, on any day, the maximum
nonusurious rate of interest permitted for that day by whichever of applicable
federal or Texas law permits the higher interest rate, stated as a rate per
annum;

 

(c)           the “Balances Equivalent Rate” which, for each day in each
calendar month (whether a whole or partial month), is a rate per annum that is
equal to the lesser of:

 

(i)            the sum of (x) zero plus (y) the Balances Equivalent Margin for
that day and for each Class of Borrowings in the Balances Equivalent Tranche (if

 

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any); and

 

(ii)           the Ceiling Rate for that day;

 

(d)           the “Base Rate” which, for each day of the term of the Loan, is a
rate per annum equal to the lesser of:

 

(i)            the sum of (1) the quotient of (x) LIBOR for that day divided by
(y) 1.00 minus the Eurodollar Reserve Requirement for one day loans, plus (2)
the LIBOR Margin for each Class of Borrowings in the Base Rate Tranche (if any),
rounded upwards, if necessary, to the nearest 1/1,000th of 1%; and

 

(ii)           the Ceiling Rate for that day; and

 

(e)           the “Past Due Rate” which means, on any day, the lesser of:

 

(i)            either (x) a rate per annum equal to the per annum interest rate
that would be applicable for that day if the subject amount were not past due,
plus three percent (3%), or (y) if there is more than one (or no) such per annum
interest rate reasonably applicable to the subject amount if not past due, the
Prime Rate for that day plus three percent (3%) per annum and

 

(ii)           the Ceiling Rate for that day.

 

Each determination by the Lender of any Rate may be computed using any
reasonable method and, unless plainly wrong, shall be conclusive and binding.

 

“Stated Rate” means:

 

(a)           on any day, for each Class of Borrowings in the Balances
Equivalent Tranche, the Balances Equivalent Rate for the month in which that day
falls and that Class of Borrowings, computed in accordance with the provisions
of this Agreement, compounded annually, and for the Balances Equivalent Tranche
as a whole, the weighted average of such Balances Equivalent Rates for such
Classes of Borrowings;

 

(b)           on any day, for each Class of Borrowings in the Base Rate Tranche,
the Base Rate for that day and that Class of Borrowings, computed in accordance
with the provisions of this Agreement, compounded annually, and for the Base
Rate Tranche as a whole, the weighted average of such Base Rates for such
Classes of Borrowings;

 

(c)           on any day, for each Class of Borrowings in the Alternate Base
Rate Tranche, the Alternate Base Rate for that day and that Class of Borrowings,
computed in accordance with the provisions of this Agreement, compounded

 

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annually, and for that Tranche as a whole, the weighted average of such
Alternate Base Rates for such Classes of Borrowings;

 

(d)           for each Borrowing as a whole, the weighted average of the
interest rates applicable to each of its constituent Tranches; and

 

(e)           for the Loan as a whole, the weighted average of the interest
rates applicable to each of the constituent Tranches of each outstanding
Borrowing;

 

provided that if on any day the applicable rate for any such Tranche, any such
Borrowing as a whole or the Loan as a whole shall exceed the relevant Ceiling
Rate for that day, then the Stated Rate therefor shall be reset to equal the
Ceiling Rate on that day and shall be set to equal the Ceiling Rate for each day
thereafter until the total amount of interest accrued at the Stated Rate on the
unpaid balance of that Tranche, that Borrowing or the Loan (as applicable)
equals the total amount of interest that would have accrued on it if there were
no Ceiling Rate.

 

6.  INTEREST, PRINCIPAL AND FEES PAYMENTS

 

Section 6.5 is hereby amended in its entirety to henceforth read as follows:

 

6.5           FACILITY FEE.  THE BORROWERS JOINTLY AND SEVERALLY AGREE TO PAY TO
THE LENDER A CASH FACILITY FEE (THE “FACILITY FEE”) IN AN AMOUNT EQUAL TO
FIFTEEN BASIS POINTS (.15%) PER ANNUM OF THE COMMITTED SUM FOR THE PERIOD FROM
THE 4/05 AMENDMENT EFFECTIVE DATE THROUGH THE TERMINATION DATE.  THE FACILITY
FEE FOR THE PERIOD FROM THE 4/05 AMENDMENT EFFECTIVE DATE THROUGH JULY 31, 2005
SHALL BE DUE AND PAYABLE IN ADVANCE ON THE 4/05 AMENDMENT EFFECTIVE DATE, AND
THE FACILITY FEE FOR EACH SUCCEEDING PERIOD OF THREE (3) MONTHS (OR LESS) UNTIL
THE MATURITY DATE SHALL BE DUE AND PAYABLE IN ADVANCE ON THE FIFTEENTH (15TH)
DAY OF THE FIRST CALENDAR MONTH IN EACH SUCH PERIOD, COMMENCING AUGUST 15,
2005.  IF THE COMMITTED SUM SHALL BE INCREASED OR DECREASED FROM TIME TO TIME
EITHER PURSUANT TO A PROVISION OF THIS AGREEMENT OR BY SEPARATE AGREEMENT AMONG
THE BORROWERS AND THE LENDER (EXCLUDING, HOWEVER, ANY CHANGE OCCURRING AS A
RESULT OF OR FOLLOWING THE OCCURRENCE OF A DEFAULT OR AN EVENT OF DEFAULT, IN
RESPECT OF WHICH NO ADJUSTMENT OF THE FACILITY FEE SHALL BE REQUIRED EXCEPT IF
AND TO THE EXTENT REQUIRED BY THE PROVISIONS OF SECTION 16.3), THE AMOUNT OF THE
FACILITY FEE PAID IN ADVANCE FOR THE THREE-MONTH PERIOD IN WHICH THE EFFECTIVE
DATE OF THE AMENDMENT PRODUCING SUCH INCREASE OR DECREASE OCCURS SHALL BE
ADJUSTED FOR THE UNEXPIRED PORTION OF THAT THREE-MONTH PERIOD BY, RESPECTIVELY,
A CASH PAYMENT BY THE BORROWERS TO THE LENDER OR A CASH REFUND BY THE LENDER TO
THE BORROWERS, AND THE AMOUNTS OF PAYMENTS OF THE FACILITY FEE SUBSEQUENTLY DUE
SHALL LIKEWISE BE PROPORTIONATELY ADJUSTED BASED ON THE NEW AGGREGATE COMMITTED
SUM.  THE FACILITY FEE IS COMPENSATION TO THE LENDER FOR COMMITTING TO MAKE
FUNDS AVAILABLE FOR REVOLVING CREDIT ADVANCES ON THE TERMS AND SUBJECT TO THE
CONDITIONS OF THIS AGREEMENT, AND IS NOT COMPENSATION FOR THE USE OR FORBEARANCE
OR DETENTION OF MONEY, ALTHOUGH THIS SECTION (AS WELL AS EVERY OTHER SECTION OF
THIS

 

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AGREEMENT) IS SUBJECT TO THE PROVISIONS OF SECTION 16.3.  EACH CALCULATION BY
THE LENDER OF THE AMOUNT OF THE FACILITY FEE SHALL BE CONCLUSIVE, ABSENT
MANIFEST ERROR.  THE BORROWERS SHALL BE JOINTLY AND SEVERALLY LIABLE TO PAY TO
THE LENDER ON DEMAND ANY DEFICIENCY IN PAYMENT BY THE BORROWERS OF THE FACILITY
FEE.

 

7.  COLLATERAL

 

7.1           GRANT OF SECURITY INTEREST.  THE PROVISIONS OF SECTION 7.1 OF THE
4/04 A& R CREDIT AGREEMENT ARE NOT AMENDED HEREBY.  CUMULATIVE OF SUCH EXISTING
PROVISIONS, AS SECURITY FOR THE PAYMENT OF THE LOAN AND FOR THE PAYMENT AND
PERFORMANCE OF ALL OF THE OBLIGATIONS, EACH BORROWER HEREBY GRANTS TO THE LENDER
A FIRST PRIORITY SECURITY INTEREST IN ALL OF SUCH BORROWER’S PRESENT AND FUTURE
ESTATE, RIGHT, TITLE AND INTEREST IN AND TO THE COLLATERAL AND THE PARTIES
HEREBY DECLARE AND CONFIRM THAT ALL SUCH SECURITY INTERESTS WERE AND ARE GRANTED
TO AND HELD BY THE LENDER.

 

8.  CONDITIONS PRECEDENT

 

Section 8 of the 4/04 A&R Credit Agreement is hereby amended by adding the
following new Section 8.3 to the end of Section 8, viz.:

 

8.3           Advances.  In addition to the conditions precedent stated in
Sections 8.1 and 8.2, above, the obligations of the Lender to fund any Advance
under this Agreement after the 4/05 Amendment Effective Date are subject to the
satisfaction, in the sole discretion of the Lender, on or before the date of the
first such Advance, of the following condition precedent:

 

The Lender shall have received the following, all of which must be satisfactory
in form and content to the Lender in its sole discretion:

 

(A)           THE 4/05 AMENDMENT, DULY EXECUTED BY ALL PARTIES;

 

(B)           A CERTIFICATE OF EACH BORROWER’S SECRETARY AS TO (I) THE
INCUMBENCY OF THE OFFICERS OF SUCH BORROWER EXECUTING THIS AMENDMENT, EACH
APPLICABLE REQUEST FOR BORROWING AND ALL OTHER CREDIT PAPERS EXECUTED OR TO BE
EXECUTED BY OR ON BEHALF OF SUCH BORROWER AND (II) THE AUTHENTICITY OF THEIR
SIGNATURES — AND SPECIMENS OF THEIR SIGNATURES SHALL BE INCLUDED IN SUCH
CERTIFICATE OR SET FORTH ON AN EXHIBIT ATTACHED TO IT — (THE LENDER SHALL BE
ENTITLED TO RELY ON THAT CERTIFICATE UNTIL SUCH BORROWER HAS FURNISHED NEW
CERTIFICATES TO THE LENDER, AND CERTIFYING THAT ATTACHED TO SUCH CERTIFICATES
ARE TRUE AND CORRECT COPIES OF ALL AMENDMENTS TO SUCH BORROWER’S CERTIFICATES OF
ORGANIZATION AND REGULATIONS SINCE ITS INCEPTION);

 

(C)           SUCH OTHER DOCUMENTS, IF ANY, AS SHALL BE SPECIFIED BY THE LENDER.

 

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9.  REPRESENTATIONS

 

Each Borrower hereby republishes, and ratifies and (except as to those that are
specified to relate only to a specific date) confirms as being currently true
and correct, its warranties and representations made in the 4/04 A&R Credit
Agreement, effective as of the 4/05 Amendment Effective Date.

 

11.  NEGATIVE COVENANTS

 

Section 11.1 is hereby amended to add subsection (j) to henceforth read as
follows:

 

(J)            PERMITTED GUARANTEES.

 

Sections 11.2, 11.3, 11.4 and 11.8(e) are hereby amended in their entirety to
henceforth read as follows:

 

11.2         DEBT TO AFFILIATES.  INCUR ANY DEBT TO ANY AFFILIATE OR OTHERWISE
UNDERTAKE OR ENGAGE IN ANY OTHER TRANSACTION WITH ANY AFFILIATE (EXCEPT
UNSECURED DEBT TO THE OTHER BORROWER) EXCEPT UPON FAIR AND REASONABLE TERMS NO
LESS FAVORABLE THAN THE APPLICABLE BORROWER COULD OBTAIN IN A COMPARABLE
ARM’S-LENGTH TRANSACTION WITH A PERSON WHO IS NOT AN AFFILIATE AND, AFTER GIVING
EFFECT TO ANY AND ALL OF WHICH TRANSACTIONS, THERE IS NO VIOLATION OF ANY OF
SECTIONS 11.1, 11.8 OR 12.1(I).

 

11.3         CONTINGENT LIABILITIES.  ASSUME, GUARANTEE, ENDORSE OR OTHERWISE
BECOME LIABLE FOR THE DEBT OR OTHER OBLIGATION OF ANY PERSON OR ENTITY EXCEPT
(I) PERMITTED DEBT OF THE OTHER BORROWER OR BY ENDORSEMENT OF NEGOTIABLE
INSTRUMENTS FOR DEPOSIT OR COLLECTION IN THE ORDINARY COURSE OF BUSINESS AND
(II) PERMITTED GUARANTEES; PROVIDED THAT CUSTOMARY SALES REPRESENTATIONS AND
WARRANTIES MADE IN RESPECT OF MORTGAGE LOANS SOLD TO INVESTORS IN SECONDARY
MARKET TRANSACTIONS THAT ARE TYPICAL FOR SALES OR SECURITIZATIONS OF THE TYPE
CONTEMPLATED AND MADE IN THE ORDINARY COURSE OF THE APPLICABLE BORROWER’S
BUSINESS SHALL NOT BE CONSIDERED TO BE GUARANTIES FOR PURPOSES OF THIS SECTION.

 

11.4         CONDITIONAL REPURCHASE, INDEMNITY OR OTHER RECOURSE OBLIGATIONS. 
UNDERTAKE OR ASSUME ANY CONDITIONAL REPURCHASE, INDEMNITY OR OTHER RECOURSE
OBLIGATIONS IN RESPECT OF MORTGAGE LOANS SOLD (EXCLUDING CUSTOMARY SALES
REPRESENTATIONS AND WARRANTIES MADE IN CONNECTION WITH ANY WHOLE LOAN SALE OR
SECURITIZATION THAT ARE TYPICAL FOR WHOLE LOAN SALES OR SECURITIZATIONS OF THAT
SAME TYPE) WHICH OBLIGATIONS COULD EXPOSE THE BORROWER TO LOSSES IN EXCESS OF
TEN MILLION DOLLARS ($10,000,000) IN THE AGGREGATE.

 

11.8(E)    GAAP NET INCOME OF FIC.  PERMIT FIC (ON A CONSOLIDATED BASIS WITH ITS
SUBSIDIARIES) TO EARN LESS THAN ONE DOLLAR ($1) OF NET INCOME, AS DETERMINED IN
ACCORDANCE WITH GAAP AND WITHOUT REGARD TO UNREALIZED GAINS OR LOSSES FROM MARK
TO

 

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MARKET VALUATIONS RESULTING FROM BORROWER’S INTEREST RATE PROTECTION AGREEMENT
DURING SUCH PERIODS, IN ANY TWO (2) CONSECUTIVE ROLLING FISCAL QUARTERS.

 

12.  DEFAULTS AND REMEDIES

 

Sections 12.1(c) and 12.1(j) are hereby amended in their entirety to henceforth
read as follows:

 

(C)           FAILURE OF THE BORROWERS OR ANY OF THEIR SUBSIDIARIES TO PAY ANY
OTHER DEBT WHEN DUE (OTHER THAN DEBT OF A CONSOLIDATED, WHOLLY-OWNED SUBSIDIARY
THAT IS A SPECIAL PURPOSE ENTITY INCURRED IN CONNECTION WITH PERMITTED
SECURITIZATIONS), OR ANY DEFAULT IN THE PAYMENT WHEN DUE OF ANY PRINCIPAL OR
INTEREST ON ANY OTHER SUCH DEBT OR IN THE PAYMENT WHEN DUE OF ANY CONTINGENT
OBLIGATION; OR BREACH OR DEFAULT WITH RESPECT TO ANY OTHER MATERIAL TERM OF ANY
OTHER DEBT OR OF ANY PROMISSORY NOTE, BOND, LOAN AGREEMENT, REIMBURSEMENT
AGREEMENT, MORTGAGE, INDENTURE OR OTHER AGREEMENT RELATING THERETO, IF THE
EFFECT OF ANY SUCH FAILURE, DEFAULT OR BREACH REFERRED TO IN THIS SECTION
12.1(C), IS TO CAUSE, OR TO PERMIT THE HOLDER OR HOLDERS OF SUCH OBLIGATION (OR
A TRUSTEE ON BEHALF OF SUCH HOLDER OR HOLDERS) TO CAUSE, DEBT OF THE BORROWERS
OR ANY OF THEIR SUBSIDIARIES IN THE AGGREGATE AMOUNT OF TEN MILLION DOLLARS
($10,000,000) OR MORE TO BECOME OR BE DECLARED DUE BEFORE ITS STATED MATURITY.

 

(J)            ANY MONEY JUDGMENT, WRIT OR WARRANT OF ATTACHMENT, OR SIMILAR
PROCESS INVOLVING IN ANY CASE AN AMOUNT IN EXCESS OF TEN MILLION DOLLARS
($10,000,000) SHALL BE ENTERED OR FILED AGAINST EITHER BORROWER OR ANY OF ITS
SUBSIDIARIES OR ANY OF THEIR RESPECTIVE ASSETS AND SHALL REMAIN UNDISCHARGED,
UNVACATED, UNBONDED OR UNSTAYED FOR A PERIOD OF SIXTY (60) DAYS OR IN ANY EVENT
LATER THAN FIVE (5) DAYS BEFORE THE DATE OF ANY PROPOSED SALE THEREUNDER
(UNLESS, IN RESPECT OF ANY SUCH CASE THE JUDGMENT DEBTOR OR THE SUBJECT OF THE
WRIT OR WARRANT OF ATTACHMENT OR SIMILAR PROCESS IS ONE OF THE RELEVANT
BORROWER’S SUBSIDIARIES OR SUCH SUBSIDIARY’S PROPERTY, AND SUCH ORDER, CASE
COMMENCEMENT, CONSENT, ASSIGNMENT, INABILITY OR FAILURE OR ADMISSION HAS NO
MATERIAL ADVERSE EFFECT ON THE BORROWERS’ ABILITY TO FULFILL THEIR OBLIGATIONS
UNDER THIS AGREEMENT, ANY SENIOR CREDIT NOTE OR ANY OTHER CREDIT PAPER).

 

16.  MISCELLANEOUS

 

Notice Pursuant to Tex. Bus. & Comm. Code §26.02.  THE 4/04 A&R CREDIT AGREEMENT
DATED AS OF APRIL 21, 2004, AS AMENDED BY THE 4/05 AMENDMENT TO CREDIT AGREEMENT
DATED AS OF APRIL 20, 2005 AND THE OTHER CREDIT PAPERS TOGETHER CONSTITUTE A
WRITTEN LOAN AGREEMENT WHICH REPRESENTS THE FINAL AGREEMENT BETWEEN THE PARTIES
AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS OR SUBSEQUENT
ORAL AGREEMENTS OF THE PARTIES.  THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN
THE PARTIES.

 

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(The remainder of this page is intentionally blank; unnumbered counterpart
signature pages follow.)

 

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EXECUTED effective as April 20, 2005.

 

 

FIELDSTONE INVESTMENT CORPORATION

 

 

 

 

 

By:

/s/ Robert G. Partlow

 

 

Name: Robert G. Partlow

 

Title: Senior Vice President

 

 

 

FIELDSTONE MORTGAGE COMPANY

 

 

 

 

 

By:

/s/ Mark C. Krebs

 

 

Name: Mark C. Krebs

 

Title: Sr. Vice President & Treasurer

 

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JPMORGAN CHASE BANK, N.A.

 

 

 

 

 

By:

/s/ Ray M. Meyer

 

 

Name: Ray M. Meyer

 

Title: Vice President

 

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[g71411kaimage001.gif]

 

 

4/05 AMENDMENT TO CREDIT AGREEMENT

Dated as of April 20, 2005

Amending (for the first time) the

 

4/04 Amended and Restated Senior Secured Credit Agreement

dated as of April 21, 2004

by and among

 

FIELDSTONE INVESTMENT CORPORATION

 

FIELDSTONE MORTGAGE COMPANY

 

and

 

JPMORGAN CHASE BANK, N.A.

 

 

$200,000,000 Senior Secured Revolving Credit

 

 

[g71411kaimage003.jpg]

 

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INDEX OF DEFINED TERMS

 

4/04 A&R Credit Agreement

 

4/05 Amendment

 

4/05 Amendment Effective Date

 

Acceleration Date

 

Alternate Base Rate

 

Alternate Base Rate Margin

 

Amendment

 

Balances Equivalent Margin

 

Balances Equivalent Rate

 

Base Rate

 

Borrower

 

Borrowers

 

Ceiling Rate

 

Change of Control

 

Committed Sum

 

Company

 

Current Credit Agreement

 

Custodian

 

Custody Agreement

 

Facility Fee

 

FIC

 

JPMorgan

 

Lender

 

LIBOR Margin

 

Margin

 

Maturity Date

 

Past Due Rate

 

Permitted Guarantees

 

Rate

 

Stated Rate

 

Total Liabilities

 

 

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