EX-10.1






EXHIBIT 10.1




MASTER REPURCHASE AGREEMENT




Dated as of March 31, 2006




BETWEEN:



(1) Sheffield Receivables Corporation, as a buyer (together with its permitted transferees,
“Senior Buyer”, which term shall include any “Principal” as defined and provided
for in Annex I for whom Senior Buyer is acting as “Buying Agent” as defined in Annex I) or
as Buying Agent pursuant hereto; (2) Barclays Bank PLC, as a Buyer (in such capacity, together with
its permitted transferees, “Subordinate Buyer,” which term shall include any
“Principal” for whom Subordinate Buyer is acting as Buying Agent) or as Buying Agent
pursuant hereto (each of Senior Buyer and Subordinate Buyer being a “Buyer” and
collectively “Buyers”); (3) Barclays Bank PLC, as administrative agent, in accordance with
the terms of this Agreement and Annex II hereto (in such capacity, together with successors, the
“Administrative Agent”); (4) NC Capital Corporation (“NCCC”), New Century Mortgage
Corporation (“NCMC”), New Century Credit Corporation (“NCC”), Home123 Corporation
(“Home123”) and NC Asset Holding, L.P. (“NCAH” and together with NCCC, NCMC,
Home123 and NCC each a “Seller” and collectively referred to as “Sellers”).




	1.	 	APPLICABILITY





Each Buyer hereby commits and agrees, from time to time, upon the terms and conditions set
forth herein, to enter into certain transactions hereinafter described (up to, in the aggregate,
the Maximum Aggregate Purchase Price for all Outstanding Transactions entered into from time to
time by Buyers with all Sellers – all such capitalized terms not heretofore defined, as well as
other capitalized terms used in this Agreement, being defined in Section 2 hereof). In each such
transaction, a Seller assigns and transfers to a Buyer an interest in certain loans constituting
Eligible Assets (and, upon such assignment and transfer, “Purchased Assets,” which may be Group A
Purchased Assets or Group B Purchased Assets) against the transfer of funds by such Buyer, with a
simultaneous agreement by such Buyer to assign and transfer to such Seller such interest in such
Purchased Assets at a date certain against the transfer of funds by such Seller. Each such
transaction shall be referred to herein as a “Transaction”, and, unless otherwise agreed in
writing, shall be governed by this Agreement. Each Transaction between a Buyer and a Seller with
respect to Group A Purchased Assets (i) shall occur substantially concurrently with a related
Transaction between the other Buyer and the same Seller, in each case for the assignment and
transfer by such Seller to each Buyer of an undivided interest in those same Group A Purchased
Assets, and for the subsequent reassignment and retransfer by Buyers to such Seller of those same
Group A Purchased Assets, and (ii) may occur simultaneously with a Transaction between such Seller
and Subordinate Buyer with respect to Group B Purchased Assets on such date, all as hereinafter set
forth. In addition, a Seller may enter into one or more separate Transactions with Subordinate
Buyer with respect to Group B Purchased Assets, in each case, for the assignment and transfer by
such Seller to Subordinate Buyer of such Group B Purchased Assets and for the subsequent
reassignment and retransfer by Subordinate Buyer to such Seller of those same Purchased Assets, all
as hereinafter set forth.




	2.	 	DEFINITIONS AND INTERPRETATION






	 	a.	 	Defined Terms.





“Account Agreement” means that certain account agreement, dated as of the date hereof,
among Sellers, the Servicer, the Administrative Agent, on its behalf and on behalf of Buyers, and
UBC, relating to the Collection Account.



“Additional Purchased Assets” has the meaning assigned thereto in Section 6(a) hereof.



“Affiliate” means, with respect to any specified Person, any other Person controlling
or controlled by or under common control with such specified Person. For the purposes of this
definition, “control” means the power to direct the management and policies of such Person,
directly or indirectly, whether through the ownership of voting equity, by contract or otherwise.



“Agreement” means this Master Repurchase Agreement, as it may be amended, supplemented
or otherwise modified from time to time.



“Base Rate” means, for each day, a fluctuating interest rate per annum that is the
daily prime rate of interest announced publicly in The Wall Street Journal or if more than one rate
is published, the highest of such rates. Each change in the Base Rate shall take effect
simultaneously with the corresponding change or changes in such prime rate.



“Borrower” means the obligor or obligors on a Note, including any Person that has
acquired the related collateral and assumed the obligations of the original obligor or obligors
under the Note.



“Breakage Costs” has the meaning assigned thereto in Section 3(d) herein.



“Business Day” means any day other than (i) a Saturday or Sunday or (ii) a day upon
which the New York Stock Exchange, the Federal Reserve Bank of New York or the Custodian is
authorized or obligated by law or executive order to be closed.



“Buyer’s Margin Amount” means, with respect to any Transaction between a Buyer and a
Seller, as of any date, the amount obtained by application of such Buyer’s Margin Percentage to
such Buyer’s Repurchase Price for such Transaction as of such date.



“Buyer’s Margin Deficit” has the meaning assigned thereto in Section 6(a) hereof.



“Buyer’s Margin Percentage” has the meaning assigned thereto in the Side Letter.



“Buyer’s Purchase Price” means, in respect of any Transaction, any Purchased Asset
subject thereto and any Buyer, the Senior Buyer’s Purchase Price (if such Buyer is the Senior
Buyer) or the Subordinate Buyer’s Purchase Price (if such Buyer is the Subordinate Buyer).



“Buyer’s Repurchase Price” means, in respect of any Transaction, any Purchased Asset
subject thereto and any Buyer, the Senior Buyer’s Repurchase Price (if such Buyer is Senior Buyer)
or the Subordinate Buyer’s Repurchase Price (if such Buyer is Subordinate Buyer).



“Cash Equivalents’ means any of the following: (a) marketable direct obligations
issued by, or unconditionally guaranteed by, the United States Government or issued by any agency
thereof and backed by the full faith and credit of the United States, in each case maturing within
one year from the date of acquisition; (b) certificates of deposit, time deposits, eurodollar time
deposits or overnight bank deposits having maturities of six months or less from the date of
acquisition issued by any commercial bank organized under the laws of the United States or any
state thereof having combined capital and surplus of not less than $500,000,000; (c) commercial
paper of an issuer rated at least A-1 by Standard & Poor’s Ratings Services (‘S&P’) or P-1 by
Moody’s Investors Service, Inc. (‘Moody’s’), or carrying an equivalent rating by a nationally
recognized rating agency, if both of the two named rating agencies cease publishing ratings of
commercial paper issuers generally, and maturing within six months from the date of acquisition;
(d) repurchase obligations of any commercial bank satisfying the requirements of clause (b) of this
definition, having a term of not more than 30 days, with respect to securities issued or fully
guaranteed or insured by the United States government; (e) securities with maturities of one year
or less from the date of acquisition issued or fully guaranteed by any state, commonwealth or
territory of the United States, by any political subdivision or taxing authority of any such state,
commonwealth or territory or by any foreign government, the securities of which state,
commonwealth, territory, political subdivision, taxing authority or foreign government (as the case
may be) are rated at least A by S&P or A-2 by Moody’s; (f) securities with maturities of six months
or less from the date of acquisition backed by standby letters of credit issued by any commercial
bank satisfying the requirements of clause (b) of this definition; or (g) shares of money market
mutual or similar funds which invest exclusively in assets satisfying the requirements of clauses
(a) through (f) of this definition.



“Change in Control” means the acquisition by any Person, or two or more Persons acting
in concert, of beneficial ownership (within the meaning of Rule 13d-3 of the Securities and
Exchange Commission under the Securities Exchange Act of 1934) of outstanding shares of voting
stock of an entity at any time if after giving effect to such acquisition such Person or Persons
owns fifty percent (50%) or more of such outstanding voting stock.



“Change in Law” means (a) the adoption of any law, rule or regulation after the date
of this Agreement, (b) any change in any law, rule or regulation or in the interpretation or
application thereof by any Governmental Authority after the date of this Agreement or (c)
compliance by any Buyer (or any Affiliate of any Buyer) with any request, guideline or directive
(whether or not having the force of law) of any Governmental Authority made or issued after the
date of this Agreement.



“Code” means the Internal Revenue Code of 1986, as amended.



“Collateral” has the meaning assigned thereto in Section 8 hereof.



“Collection Account” means a segregated account maintained by the Servicer with UBC,
pursuant to the Account Agreement, and referred to therein as the “Collection Account,” in the name
of the Servicer and for the benefit of the Administrative Agent and Buyers.



“Computer Medium” means a computer tape or other electronic medium generated by or on
behalf of a Seller and delivered or transmitted to Buyers or to the Administrative Agent and to
Custodian which provides information relating to the Purchased Assets, including the identity of
the related servicer with respect to each Loan and the information set forth in the Loan Schedule,
in a format reasonably acceptable to Buyer.



“Confirmation” has the meaning assigned thereto in Section 4(d) hereof.



“Contractual Obligation” means, as to any Person, any material provision of any
agreement, instrument or other undertaking to which such Person is a party or by which it or any of
its property is bound or any material provision of any security issue by such Person.



“Custodian” means DBNTC, as Custodian under the Custody Agreement, or its successor
custodians.



“Custody Agreement” means the Custodial Agreement, dated as of the date hereof, as it
may be amended, supplemented or otherwise modified from time to time, among NCCC, NCMC, NCAH, NCC,
Home123, Buyers, the Administrative Agent, and DBNTC, as Custodian.



“DBNTC” means Deutsche Bank National Trust Company, or its successors and permitted
assigns.



“Default” means any event that, with the giving of notice or the passage of time or
both, would constitute an Event of Default.



“Default Rate” means, as of any date of determination, (a) the lesser of (i) the
Pricing Rate plus 4% and (ii) the maximum rate permitted by applicable law or (b) with respect to
any amount owing under Section 3(e) of this Agreement, LIBOR.



“Effective Date” means the date set forth on the top of the first page of this
Agreement.



“Electronic Tracking Agreement” means an Electronic Tracking Agreement among the
Administrative Agent, Buyers, Sellers, MERS and MERSCORP, Inc., to the extent applicable, as it may
be amended, supplemented or otherwise modified from time to time.



“Eligible Asset” has the meaning assigned thereto in the Side Letter.



“ERISA” has the meaning assigned thereto in Section 21 hereof.



“ERISA Affiliate” means any corporation or trade or business that is a member of any
group of organizations (i) described in Section 414(b) or (c) of the Code of which a Seller or the
Guarantor is a member and (ii) solely for purposes of potential liability under Section 302(c)(11)
of ERISA and Section 412(c)(11) of the Code and the lien created under Section 302(f) of ERISA and
Section 412(n) of the Code, described in Section 414(m) or (o) of the Code of which such Seller or
the Guarantor is a member.



“Event of Default” has the meaning assigned thereto in Section 18 hereof.



“Event of Default Costs” means the Administrative Agent’s or, as applicable, any
Buyer’s costs and expenses incurred as a result of or in connection with (or as a result of or in
connection with enforcing their rights and remedies pursuant to this Agreement or any other Program
Documents, following) any Event of Default (including such costs and expenses as have been incurred
pursuant to Section 19, 22 and 38 hereof).



“Excluded Taxes” has the meaning assigned thereto in Section 13(j) hereof.



“Fannie Mae” means Fannie Mae, the government sponsored enterprise formerly known as
the Federal National Mortgage Association.



“Freddie Mac” means the Federal Home Loan Mortgage Corporation.



“Funding Account” has the meaning assigned thereto in the Custody Agreement.



“GAAP” means generally accepted accounting principles in the United States of America
in effect from time to time.



“Governmental Authority” means any nation or government, any state or other political
subdivision thereof, any central bank, or any entity exercising executive, legislative, judicial,
regulatory or administrative functions over Sellers, the Servicer, Buyers, the Administrative Agent
or Guarantor.



“Group A Purchased Asset” has the meaning assigned thereto in the Side Letter.



“Group B Purchased Asset” has the meaning assigned thereto in the Side Letter.



“Guarantee” means, as to any Person, any obligation of such Person directly or
indirectly guaranteeing any Indebtedness of any other Person or in any manner providing for the
payment of any Indebtedness of any other Person.



“Guarantor” means NCFC, in its capacity as guarantor under the Guaranty or any
successors thereto.



“Guaranty” means the Guaranty Agreement, dated as of the date hereof, of NCFC, as
Guarantor, in favor of the Administrative Agent for its benefit and the benefit of Buyers, as such
agreement may be amended, supplemented or otherwise modified from time to time.



“Hedge Counterparty” means a Person (i) (A) with long-term and commercial paper or
short-term deposit ratings of “P-1” by Moody’s Investors Service and “A-1” by Standard & Poor’s and
(B) which shall agree in writing that, in the event that any of its long-term or commercial paper
or short-term deposit ratings cease to be at or above “A-2” by Moody’s and “A” by Standard &
Poor’s, either such Person shall secure its obligations in accordance with the request of Buyers or
Buyers shall have the option to treat such failure as an Early Termination Event (as defined in the
ISDA Master Agreement) by such Person, as Hedge Counterparty under the Hedge Instrument referred to
in clause (ii) below and (ii) which has entered into a Hedge Instrument.



“Hedge Instrument” means any interest rate cap agreement, interest rate floor
agreement, interest rate swap agreement or other interest rate hedging agreement entered into by
the Seller or the Guarantor with a Hedge Counterparty that relates to or applies to the Purchased
Assets, as any such item may be amended, supplemented or otherwise modified from time to time.



“Income” means, with respect to any Purchased Asset at any time, any principal and/or
interest thereon and all dividends, sale proceeds and other collections and distributions thereon
accrued in respect of periods on or after the initial Purchase Date with respect to such Purchased
Asset.



“Indebtedness” means, for any Person: (a) all obligations for borrowed money; (b)
obligations of such Person to pay the deferred purchase or acquisition price of Property or
services, other than trade accounts payable (other than for borrowed money) arising, and accrued
expenses incurred, in the ordinary course of business so long as such trade accounts payable are
payable and paid within ninety (90) days of the date the related invoice is received for the
respective goods delivered or the respective services rendered; (c) indebtedness of others secured
by a lien on the Property of such Person, whether or not the respective indebtedness so secured has
been assumed by such Person; (d) obligations (contingent or otherwise) of such Person in respect of
letters of credit or similar instruments issued for account of such Person; (e) capital lease
obligations of such Person; (f) obligations of such Person under repurchase agreements or like
arrangements; (g) indebtedness of others guaranteed on a recourse basis by such Person; (h) all
obligations of such Person incurred in connection with the acquisition or carrying of fixed assets
by such Person; (i) indebtedness of general partnerships of which such Person is a general partner;
and (j) any other contingent liabilities of such Person.



“Investment Company Act” means the Investment Company Act of 1940, as amended,
including all rules and regulations promulgated thereunder.



“Jumbo Loan” means a Loan that is not eligible for sale to Fannie Mae or Freddie Mac
solely because the principal amount of the loan is in excess of the amount permitted for all
typical programs.



“LIBOR” means, for each day, a rate per annum determined by the Administrative Agent
in accordance with the following formula (rounded upwards to the nearest 1/100th of one
percent) which rate as determined by the Administrative Agent shall be conclusive absent manifest
error by the Administrative Agent:



             LIBOR Base Rate             



1.00 – LIBOR Reserve Percentage



“LIBOR Base Rate” means, for each day, an interest rate per annum equal to the rate of
interest per annum at which one-month deposits in U.S. dollars are offered by the Administrative
Agent’s principal office in London, England, to prime banks in the London Interbank Market at
11:00 a.m. (London time) on such date (or, in the event such day is a day on which banks are
required or authorized to close in London, England, the prior day) as set forth on Telerate Page
3750. In the event that on such date one-month deposits in U.S. dollars are not being offered by
the Administrative Agent’s principal office in London, England, to prime banks in the London
Interbank Market, LIBOR Base Rate shall mean, for such date, an interest rate per annum equal to
the rate of interest per annum at which one-month deposits in U.S. dollars are offered for such
date and in an amount substantially equal to the amount of the Purchase Price to which the LIBOR
Base Rate is to be applied, as set forth on the Reuters Screen LIBO Page as of 11:00 a.m. (London
time) on such date (or, in the event such day is a day on which banks are required or authorized to
close in London, England, the prior day). If at least two rates appear on the Reuters LIBO Page,
the rate for such date will be the arithmetic mean of such rates.



“LIBOR Reserve Percentage” means, for each day, the reserve percentage applicable for
such day (or if more than one such percentage shall be so applicable the arithmetic mean of such
percentages under regulations issued from time to time by the Board of Governors of the Federal
Reserve System (or any successor) (the “Board”) for determining the maximum reserve
requirement (including, without limitation, any emergency, supplemental or other marginal reserve
requirement) for Administrative Agent with respect to liabilities or assets consisting of or
including Eurocurrency Liabilities (as defined in Regulation D of the Board, as in effect from time
to time).



“Lien” means any lien, claim, charge, pledge, security interest, mortgage, deed of
trust or other encumbrance.



“Liquidity” means, as of any date of determination, the aggregate of all cash, Cash
Equivalents, and Overcollateralization, less the amount of Restricted Cash held by NCFC on a
consolidated basis.



“Loan” means (i) a first or second lien single family (one-to-four units) residential
mortgage loan, (ii) to the extent permitted under the Side Letter, a first lien manufactured
housing mortgage loan evidenced by a Manufactured Housing Contract, (iii) such other type of
mortgage loan, lease or other receivable as shall be agreed upon by the parties as evidenced by
Appendix A to the Custody Agreement, as amended or supplemented by mutual agreement of the parties,
or (iv) any interest in, or secured by, any such loan, lease or other receivable.



“Loan Documents” has the meaning assigned thereto in the Custody Agreement.



“Loan File” has the meaning assigned thereto in the Custody Agreement.



“Loan Schedule” means the list of Loans delivered by the Guarantor or a Seller to a
Buyer and Custodian together with the Transaction Notice, in the form set forth in Exhibit 7 to the
Custody Agreement. Each Loan Schedule (together with all attachments thereto) shall set forth, as
to each Loan, (i) the related Borrower’s name, (ii) the address of the related Mortgaged Property,
(iii) the outstanding principal balance of the Loan as of the initial Purchase Date, (iv) the name
of the Seller party to the Transaction or set of Related Transactions to which such Loan is to be
subject, and (v)  any other information specified by Buyers from time to time in good faith.



“Manufactured Home” means a unit of manufactured housing, including all accessories
thereto, securing the indebtedness of the Borrower under the related Loan.



“Manufactured Housing Contract” means a Loan that is secured by a Mortgage on real
estate on which the related Manufactured Home is situated, and which Manufactured Home is
considered or classified as part of the real estate under the laws of the jurisdiction in which it
is located.



“Margin Call” has the meaning assigned thereto in Section 6(a) hereof.



“Margin Payment” has the meaning assigned to that term in Sections 741 and 101 of
Title 11 of the U.S.C.



“Market Value” means (i) with respect to any Purchased Asset that is an Eligible
Asset, as of any date of determination, the value ascribed to such Purchased Asset by Buyers in
their sole discretion using their reasonable business judgment; provided, that the value of any
Purchased Asset that is an Eligible Asset shall not exceed (x) 90% of the then outstanding
principal balance of such Purchased Asset if such Purchased Asset is 30 to 59 days past due, or (y)
80% of the then outstanding principal balance of such Purchased Asset if such Purchased Asset is 60
to 89 days past due, (ii) with respect to a Purchased Asset that is not an Eligible Asset, or is 90
or more days past due, or is not repurchased on the Repurchase Date, zero and (iii) with respect to
any Wet Funded Loan for which the related Loan File has not been delivered to the Custodian within
seven Business Days of the related Purchase Date, zero. The Market Value of any Buyer’s Purchased
Interest in any Purchased Asset shall equal such Buyer’s Purchased Interest Percentage multiplied
by the Market Value of such Purchased Asset (determined in accordance with this definition).



“Material Adverse Change” means, with respect to a Person and its Subsidiaries taken
as a whole, any material adverse change in the business, condition (financial or otherwise),
operations or performance of such Person.



“Material Adverse Effect” means (a) a Material Adverse Change with respect to (x) the
Guarantor, a Seller or the Servicer or (y) the Guarantor, the Servicer or such Seller and its
Affiliates that are party to any Program Document taken as a whole; (b) a material impairment of
the ability of the Guarantor, the Servicer or a Seller or any Affiliate that is a party to any
Program Document to perform under any Program Document and to avoid any Event of Default; (c) a
material adverse effect upon the legality, validity, binding effect or enforceability of any
Program Document against the Guarantor, the Servicer or a Seller or any Affiliate that is a party
to any Program Document; or (d) a material adverse effect upon the value or marketability of a
material portion of the Purchased Assets.



“Maximum Aggregate Purchase Price” has the meaning assigned thereto in Section 37
hereof.



“Maximum Aggregate Senior Purchase Price” has the meaning assigned thereto in Section
37 hereof.



“Maximum Aggregate Subordinate Purchase Price” has the meaning assigned thereto in
Section 37 hereof.



“MERS” means Mortgage Electronic Registration Systems, Inc., a corporation organized
and existing under the laws of the State of Delaware, or any successor thereto.



“MERS System” means the system of recording transfers of mortgages electronically
maintained by MERS.



“Mortgage” means a mortgage, deed of trust, or other instrument that creates a lien on
the related Mortgaged Property and secures a Note.



“Mortgaged Property” means, with respect to a Loan, the related Borrower’s fee
interest in real property or leasehold interest in real property and all other collateral securing
repayment of the debt evidenced by the related Note.



“Multiemployer Plan” means a multiemployer plan defined as such in Section 3(37) of
ERISA to which contributions have been or are required to be made by a Seller or any ERISA
Affiliate and that is covered by Title IV of ERISA.



“NCFC” means New Century Financial Corporation, a Maryland corporation.



“Note” or “Mortgage Note” means, with respect to any Loan, the related
promissory note together with all riders thereto and amendments thereof or other evidence of
indebtedness of the related Borrower.



“Notice Date” has the meaning assigned thereto in Section 4 hereof.



“Notice of Default” has the meaning assigned thereto in the Custody Agreement.



“Obligations” means (i) any and all obligations and liabilities of each Seller to
Buyers, their Affiliates or the Administrative Agent (for its benefit or for the benefit of any
Buyer or any such Affiliate) arising under or in connection with the Program Documents, or in
respect of each Transaction or each set of Related Transactions, and (ii) any and all sums paid by
or on behalf of any of Buyers or the Administrative Agent in accordance with the terms of any
Program Document, in each case whether for payment or performance, whether direct or indirect,
absolute or contingent, due or to become due, and whether incurred on the date hereof or at any
times hereafter including, without limitation, the following:




(a) any and all obligations to pay, on any Payment Date or Repurchase Date (whether
scheduled pursuant to Section 3(b) hereof or determined by application of Section 19 hereof)
or any other date, Repurchase Price or principal, Price Differential or interest (including,
without limitation such as purports to accrue (i) at the Default Rate, whether before or
after the date on which the related Purchase Price or principal amount was required to be
paid, or (ii) after the filing of any petition in bankruptcy, or the commencement of any
insolvency, reorganization or like proceeding, including any proceeding referred to in
Sections 18(f) and 18(g) hereof, in each case brought by or against such Seller or its
Property, whether or not such Price Differential or interest is permitted to accrue after
the filing of such petition under Title 11 of the U.S.C. and whether or not a claim for
postfiling or postpetition interest is allowed in such proceeding), Income, margin payment
(whether pursuant to a Margin Call or otherwise) or settlement payment, fees, indemnities,
costs, expenses (including, without limitation, all fees and disbursements of counsel to the
Administrative Agent and Buyers that are required to be paid by such Seller pursuant to the
terms of the Program Documents, or otherwise);




(b) any and all obligations of such Seller to reimburse to Buyers, their Affiliates or
the Administrative Agent (for its benefit or for the benefit of any Buyer or any such
Affiliate) sums paid by Buyers, such Affiliates or the Administrative Agent on behalf of
Sellers pursuant to this Agreement and the other Program Documents in order to preserve any
Purchased Asset, Buyers’ Purchased Interests therein, any Collateral, or the value of any
thereof; and




(c) any and all obligations of such Seller to Buyers, their Affiliates or the
Administrative Agent (for its benefit or for the benefit of Buyers or such Affiliates)
pursuant to the Program Documents, including such as may consist of Event of Default Costs.



“Outstanding Transactions” has the meaning assigned thereto in Section 37 hereof.



“Overcollateralization” means, as of any date of determination, the excess of (i) the
collateral value of assets pledged to a lender under a committed warehouse or repurchase facility
(after taking into account haircuts) with a Seller as borrower (other than any assets subject to
the repurchase facility that is the subject of this Agreement) over (ii) the aggregate amount of
the advances or loans made by the lender to such Seller under any such facility.



“Payment Date” means the 25th calendar day of each month or, if such a date
is not a Business Day, the next Business Day.



“Person” means any legal person, including any individual, corporation, partnership,
association, joint-stock company, trust, limited liability company, unincorporated organization,
governmental entity or other entity of similar nature.



“Price Differential” means, with respect to any Transaction and any Buyer party
thereto, as of any date, the aggregate amount obtained by daily application of the Pricing Rate for
such Transaction and such Buyer (or, upon the occurrence and during the continuance of any Default
or Event of Default, the Default Rate) to such Buyer’s Purchase Price for the Purchased Assets
subject to such Transaction (except as otherwise provided in Section 17(b) hereof), such
application to be based on a 360-day year for the actual number of days during the period
commencing on (and including) the Purchase Date and ending on (but excluding) the Repurchase Date
for such Transaction (reduced by any amount of such Price Differential in respect of such period
previously paid by the related Seller to the related Buyer with respect to such Transaction).



“Pricing Rate” means, with respect to any Buyer, the per annum percentage rate for
determination of the Price Differential for such Buyer, as set forth in the Side Letter.



“Principal” has the meaning given to it in Annex I.



“Program Documents” means this Agreement, the Custody Agreement, any Servicing
Agreement, the Guaranty, the Account Agreement, the Electronic Tracking Agreement (if executed),
any assignment of a Hedge Instrument, the Side Letter, and any other agreement entered into by any
of Sellers and Guarantor, on the one hand, and any of the Administrative Agent and Buyers or one of
their Affiliates (or Custodian on their behalf) on the other, in connection herewith or therewith.



“Property” means any right or interest in or to property of any kind whatsoever,
whether real, personal or mixed and whether tangible or intangible.



“Purchase Date” means, with respect to any Purchased Assets which are subject to any
Transaction or set of Related Transactions, the date on which such Purchased Assets are to be
assigned and transferred by a Seller to a Buyer or Buyers pursuant to the terms of such Transaction
or set of Related Transactions.



“Purchase Price” has the meaning assigned thereto in the Side Letter.



“Purchased Assets” with respect to any Transaction or a set of Related Transactions
entered into by any Buyer or Buyers with the same Seller, the Loans set forth on the related Loan
Schedule, all Additional Purchased Assets assigned and transferred pursuant to Section 6(a) hereof
and all Substitute Assets assigned and transferred pursuant to Section 16 hereof, in each case in
connection with such Transaction or set of Related Transactions, together with the related Records,
Servicing Rights, such Seller’s or any of the Guarantor’s rights under any related Hedge
Instruments (which interests in Hedge Instruments shall be pro rata and subject to rights of other
parties holding security interests therein), and all instruments, chattel paper, payment
intangibles and other general intangibles, in each case comprising or relating to any and all of
the foregoing.



“Purchased Interest” of any Buyer means the Senior Purchased Interest (if such Buyer
is Senior Buyer) or the Subordinate Purchased Interest (if such Buyer is Subordinate Buyer).



“Records” means all instruments, agreements and other books, records, reports and data
generated by other media for the storage of information maintained by a Seller, the Guarantor, any
of their Affiliates or agents, or their servicer or custodian with respect to a Purchased Asset.
Records shall include the Notes, any Mortgages, the Loan Files and any other instruments necessary
to document or service a Loan that is a Purchased Asset, including, without limitation, the
complete payment and modification history of each Loan that is a Purchased Asset.



“REIT” means a real estate investment trust, as defined in Section 856 of the Code, to
which the provisions of part II of subchapter M of chapter 1 of subtitle A of the Code applies.



“REIT Status” means for any taxable year and with respect to any Person, such Person’s
status as a REIT.



“Related Transactions” or “set of Related Transactions” means either of the
following:




(a) two, or, as applicable, three Transactions entered into substantially concurrently
by Senior Buyer and Subordinate Buyer with the same Seller, in accordance with one and the
same Transaction Notice, (i) for the assignment and transfer by such Seller to Buyers of the
same Purchased Assets listed on one and the same Loan Schedule and constituting, on the date
of such assignment and transfer, Group A Purchased Assets, and for the subsequent
reassignment and transfer by Buyers to such Seller of those same Group A Purchased Assets;
and, in addition, (ii) in the case of three such Transactions, for the assignment and
transfer by such Seller to Subordinate Buyer of Purchased Assets constituting, on the date
of such assignment and transfer, Group B Purchased Assets, and for the subsequent
reassignment and transfer by Subordinate Buyer to Seller of such Group B Purchased Assets;
and




(b) as of any date of determination and with respect to any Purchased Asset, 100% of
which was initially assigned and transferred by a Seller to Subordinate Buyer pursuant to
the terms of any one Transaction but in which, prior to such determination, pursuant to
Section 17(b) hereof, Subordinate Buyer assigned and transferred to Senior Buyer a 90%
undivided mortgage right, title and interest, such that from and after such assignment and
transfer, the rights and obligations of Senior Buyer, as well as those of Subordinate Buyer
and such Seller, are governed by the terms of such Transaction, then, from and after such
assignment and transfer, such Transaction shall be deemed a set of Related Transactions with
respect to such Purchased Asset.



“Repurchase Date” has the meaning assigned thereto in Section 3(b) and shall also
include the date determined by application of Section 19.



“Repurchase Price” means, with respect to any Transaction or set of Related
Transactions between any Buyer or Buyers and any Seller, as of any date of determination, the price
at which one or more Purchased Assets subject to such Transaction or set of Related Transactions
are to be transferred from such Buyer or Buyers to such Seller upon termination of such Transaction
or set of Related Transactions, which will be determined in each case (including Transactions
terminable upon demand) as the sum of the Senior Buyer’s Repurchase Price and the Subordinate
Buyer’s Repurchase Price for such Purchased Assets as of such date.



“Request Amount” means with respect to any Purchase Date and the Wet Funded Loans, the
total amount of funds requested by the Sellers by 7:00 p.m. (New York City time) on the Business
Day immediately preceding that Purchase Date pursuant to Section 2 of the Custody Agreement that
are required to be deposited by a Buyer or Buyers into the Funding Account on such Purchase Date.



“Required Buyers” means, at any time, Buyers that paid to Sellers 66?% of the Maximum
Aggregate Purchase Price for all Purchased Assets in all Outstanding Transactions at such time.



“Responsible Officer” means as to any Person, the chief executive officer or, with
respect to financial matters, the chief financial officer of such Person.



“Restricted Cash”: All cash and Cash Equivalent investments that are subject to a
Lien in favor of any Person that are required to be maintained by the Buyer pursuant to a
Contractual Obligation or as a result of the operation of law.



“Senior Buyer’s Purchase Price” means, with respect to any Purchased Asset that is
subject to a Transaction or a set of Related Transactions, an amount (determined as of the Purchase
Date for such Transaction or set of related Transactions) equal to the product of (i) the Senior
Purchased Interest in each such Purchased Asset and (ii) the Purchase Price for such Purchased
Asset. The Senior Buyer’s Purchase Price for all of the Purchased Assets that are subject to a
Transaction or a set of Related Transactions is the sum of the Senior Buyer’s Purchase Prices for
all such Purchased Assets, determined pursuant to the preceding sentence.



“Senior Buyer’s Repurchase Price” means, with respect to any Purchased Asset that is
subject to a Transaction or a set of Related Transactions, as of any date of determination, an
amount equal to the sum of (i) the Senior Buyer’s Purchase Price for such Purchased Asset and
(ii) the Price Differential for Senior Buyer accrued, as of such date, on such Senior Buyer’s
Purchase Price. The Senior Buyer’s Repurchase Price for all of the Purchased Assets that are
subject to a Transaction or a set of Related Transactions, as of any date of determination, is the
sum of the Senior Buyer’s Repurchase Prices for all such Purchased Assets, determined as of such
date pursuant to the preceding sentence.



“Senior Purchased Interest” means, as of any date of determination, as to any
Purchased Asset, an undivided mortgage right, title and interest in and to such Purchased Asset,
determined as follows:




(a) if such Purchased Asset is then a Group A Purchased Asset subject to the terms of
Related Transactions, an undivided mortgage right, title and interest in and to such
Purchased Asset equal to the Senior Purchased Interest Percentage (90%); and




(b) if such Purchased Asset is then a Group B Purchased Asset, zero.



“Senior Purchased Interest Percentage” means 90%.



“Servicer” means (i) initially, NCMC, or (ii) any other Person approved by Buyers in
their sole discretion exercised in good faith.



“Servicing Agreement” means any agreement (other than the Custody Agreement, but
including Annex III to this Agreement) giving rise or relating to Servicing Rights with respect to
a Purchased Asset, including any assignment or other agreement relating to such agreement, as it
may be amended, supplemented or otherwise modified from time to time.



“Servicing Rights” means contractual, possessory or other rights of a Seller or any
other Person arising under a Servicing Agreement, the Custody Agreement or otherwise, to administer
or service a Purchased Asset or to possess related Records.



“Settlement Payment” has the meaning assigned thereto in Sections 741 and 101 of
Title 11 of the U.S.C.



“Side Letter” means the pricing side letter, dated as of the date hereof, among
Sellers, Guarantor, and Buyers, as the same may be amended, supplemented or modified from time to
time.



“Structuring Fee” has the meaning assigned thereto in the Side Letter.



“Subordinate Buyer’s Purchase Price” means, with respect to any Purchased Asset that
is subject to a Transaction or a set of Related Transactions, an amount (determined as of the
Purchase Date for such Transaction or set of Related Transactions) equal to the product of (i) the
Subordinate Purchased Interest in each such Purchased Asset and (ii) the Purchase Price for such
Purchased Asset. The Subordinate Buyer’s Purchase Price for all of the Purchased Assets that are
subject to a Transaction or a set of Related Transactions is the sum of the Subordinate Buyer’s
Purchase Prices for all such Purchased Assets, determined pursuant to the preceding sentence.



“Subordinate Buyer’s Repurchase Price” means, with respect to any Purchased Asset that
is subject to a Transaction or a set of Related Transactions, as of any date of determination, an
amount equal to the sum of (i) the Subordinate Buyer’s Purchase Price for such Purchased Asset and
(ii) the Price Differential for Subordinate Buyer, accrued, as of such date, on such Subordinate
Buyer’s Purchase Price. The Subordinate Buyer’s Repurchase Price for all of the Purchased Assets
that are subject to a Transaction or a set of Related Transactions, as of any date of
determination, is the sum of the Subordinate Buyer’s Repurchase Prices for all such Purchased
Assets, determined as of such date pursuant to the preceding sentence.



“Subordinate Purchased Interest” means, as of any date of determination, as to any
Purchased Asset, an undivided mortgage right, title and interest in and to such Purchased Asset,
determined as follows:




(a) if such Purchased Asset is then a Group A Purchased Asset subject to the terms of
Related Transactions, an undivided mortgage right, title and interest in and to such
Purchased Asset equal to the Subordinate Purchased Interest Percentage (10%); and




(b) if such Purchased Asset is then a Group B Purchased Asset, an undivided mortgage
right, title and interest in and to such Purchased Asset equal to 100%.



“Subordinate Purchased Interest Percentage” means 10%.



“Subsidiary” means, with respect to any Person, any corporation, partnership or other
entity of which at least a majority of the securities or other ownership interests having by the
terms thereof ordinary voting power to elect a majority of the board of directors or other persons
performing similar functions of such corporation, partnership or other entity (irrespective of
whether or not at the time securities or other ownership interests of any other class or classes of
such corporation, partnership or other entity shall have or might have voting power by reason of
the happening of any contingency) is at the time directly or indirectly owned or controlled by such
Person or one or more Subsidiaries of such Person or by such Person and one or more Subsidiaries of
such Person.



“Substitute Assets” has the meaning assigned thereto in Section 16.



“Tangible Net Worth” means, as of any date of determination, the consolidated net
worth of NCFC and its Subsidiaries, less the consolidated net book value of all assets of NCFC and
its Subsidiaries (to the extent reflected as an asset on the balance sheet of NCFC or any
Subsidiary at such time) which will be treated as intangibles under GAAP, including, without
limitation, such items as deferred financing expenses, net leasehold improvements, goodwill,
trademarks, trade names, service marks, copyrights, patents, licenses, and unamortized debt
discount and expense; provided, that, residual securities owned by NCFC shall not be treated as
intangibles for purposes of this definition.



“Termination Date” has the meaning assigned thereto in Section 27.



“Total Indebtedness” means, for any date of determination, the aggregate of
Indebtedness of NCFC on a consolidated basis during such period maintained in accordance with GAAP;
provided, however, that for any period, the aggregate Indebtedness of NCFC during such period
maintained in accordance with GAAP shall be calculated less the aggregate amount of any such
Indebtedness that is reflected on the balance sheet of NCFC in respect of obligations incurred
pursuant to a securitization transaction, solely to the extent such obligations are secured by the
assets securitized thereby and are non-recourse to NCFC. In the event that any Indebtedness would
be excluded from the calculation of Indebtedness but for the existence of recourse, NCFC shall be
entitled nonetheless to exclude the amount of such Indebtedness that is not subject to recourse.



“Transaction” has the meaning assigned thereto in Section 1.



“Transaction Notice” means a written request of a Seller to Buyers (through the
Administrative Agent) to enter into a Transaction or set of Related Transactions, in the form
attached to the Custody Agreement, which is delivered to Buyer or Buyers (or to the Administrative
Agent for transmittal to such Buyer and Buyers) and Custodian.



“Trust Receipt” means a Trust Receipt as defined in the Custody Agreement.



“UBC” means Union Bank of California, N.A.



“Underwriting Guidelines” means NCMC’s underwriting guidelines in effect as of the
date of this Agreement, which have been approved in writing by Buyers, as the same may be amended
from time to time in accordance with terms of this Agreement.



“Uniform Commercial Code” means, as of any date of determination, the Uniform
Commercial Code as in effect in the State of New York or the Uniform Commercial Code as in effect
in the applicable jurisdiction on such date.



“U.S.C.” means the United States Code.



“Wet Funded Loan” means a Loan for which, as of the Purchase Date, the documents in
the related Loan File have not been delivered to the Custodian, and thereafter, each date until the
documents in the related Loan File have been delivered to the Custodian.



“Wet Funding Package” has the meaning assigned thereto in the Custody Agreement.



“Wet Funded Loan Trust Receipt” has the meaning assigned thereto in the Custody
Agreement.




	 	b.	 	Capitalized terms used but not defined in this Agreement shall have the
meanings assigned thereto in the Custody Agreement.





Unless the context otherwise requires, terms defined in the Uniform Commercial Code and not
otherwise defined herein are used herein as therein defined.




	 	c.	 	Interpretation.





Headings are for convenience only and do not affect interpretation. The following rules of
this subsection (c) apply unless the context requires otherwise. The singular includes the plural
and conversely. A gender includes all genders. Where a word or phrase is defined, its other
grammatical forms have a corresponding meaning. A reference to a subsection, Section, Annex or
Exhibit is, unless otherwise specified, a reference to a Section of, or annex or exhibit to, this
Agreement. A reference to a party to this Agreement or another agreement or document includes the
party’s successors and permitted substitutes or assigns. A reference to an agreement or document
is to the agreement or document as amended, modified, novated, supplemented or replaced, except to
the extent prohibited by any Program Document. A reference to writing includes a facsimile
transmission and any means of reproducing words in a tangible and permanently visible form. A
reference to conduct includes, without limitation, an omission, statement or undertaking, whether
or not in writing. An Event of Default subsists until it has been waived in writing by Buyers or
has been timely cured as reasonably determined by Buyers. “Payment” or “payment in full” means
“indefeasible payment in full (in U.S. dollars and immediately available funds).” The words
“hereof”, “herein”, “hereunder” and similar words refer to this Agreement as a whole and not to any
particular provision of this Agreement. The term “including” is not limiting and means “including
without limitation.” In the computation of periods of time from a specified date to a later
specified date, the word “from” means “from and including”, the words “to” and “until” each mean
“to but excluding”, and the word “through” means “to and including.” This Agreement may use
several different limitations, tests or measurements to regulate the same or similar matters. All
such limitations, tests and measurements are cumulative and shall each be performed in accordance
with their terms. Unless the context otherwise clearly requires, all accounting terms not
expressly defined herein shall be construed, and all financial computations required under this
Agreement shall be made, in accordance with GAAP, consistently applied. References herein to
“fiscal year” and “fiscal quarter” refer to such fiscal periods of NCFC. A reference to an
agreement includes a security interest, guarantee, agreement, or legally enforceable arrangement
whether or not in writing related to such agreement. A reference to a document includes an
agreement (as so defined) in writing or a certificate, notice, instrument or document, or any
information recorded in computer disk form. Where a Seller or the Guarantor is required to provide
any document to Buyers under the terms of this Agreement, the relevant document shall be provided
in writing or printed form unless Buyers request otherwise. At the request of any Buyers, the
document shall be provided in computer readable format or both in printed and in computer readable
format. This Agreement is the result of negotiations among and has been reviewed by counsel to
Buyers, Guarantor, and Sellers, and is the product of all parties. In the interpretation of this
Agreement, no rule of construction shall apply to disadvantage one party on the ground that such
party proposed or was involved in the preparation of any particular provision of this Agreement or
this Agreement itself.




	 	d.	 	Annexes





The Annexes to this Agreement are incorporated by reference into this Agreement and are made
an integral part hereof.




	3.	 	THE TRANSACTIONS






	 	a.	 	With respect to any Transaction or set of Related Transactions, the related
Seller shall repurchase from each Buyer party thereto, on the related Repurchase Date,
at such Buyer’s Repurchase Price, such Buyer’s Purchased Interest in the Purchased
Assets subject to such Transaction or set of Related Transactions. In furtherance of
the foregoing, such Seller shall remit to the Buyer or Buyers party thereto or their
designees an aggregate amount equal to the Repurchase Price for such Purchased Assets.
Each obligation to repurchase subsists without regard to any prior or intervening
liquidation or foreclosure with respect to any Purchased Asset. Such Seller is
obligated to obtain, and pay the Repurchase Price for, the Purchased Assets, and all
Purchased Interests therein, from each such Buyer or its designee (including the
Custodian), on the Repurchase Date, at such Seller’s expense.






	 	b.	 	Each Purchased Asset, and each Purchased Interest therein, which are subject to
a particular Transaction or set of Related Transactions, are to be repurchased by the
applicable Seller on the earlier of the following dates (such earlier date, the
“Repurchase Date”): (i) the date that is (A) 180 days from the Purchase Date
relating to such Transaction or set of Related Transactions (or, if such date is not a
Business Day, the next succeeding Business Day) (except as otherwise demanded pursuant
to clause (i)(B) below) or (B) upon at least two Business Days’ written demand (which
may be in the form of a Confirmation) by the relevant Buyer (through the Administrative
Agent) to such Seller, in accordance with Section 3(f) hereof on any Business Day
occurring after such Purchase Date and prior to the 180th day (or next
succeeding Business Day) referred to in clause (i)(A) above; and (ii) the Termination
Date.






	 	c.	 	The Sellers shall pay to the Administrative Agent (for distribution to each
Buyer) the accrued and unpaid Price Differential relating to each Transaction and such
Buyer in arrears by 4:00 p.m. (New York City time) on each Payment Date, and on the
Repurchase Date for such Transaction; provided that in calculating such Price
Differential upon the occurrence and during the continuance of any Default or Event of
Default, the Default Rate shall be used in lieu of the Pricing Rate.






	 	d.	 	If Buyers lock in the rate of LIBOR at the request of a Seller, and if such
Seller repurchases Purchased Assets on any day which is not the Repurchase Date (as
determined at the time Buyers locked in the rate of LIBOR) for such Purchased Assets,
such Seller shall indemnify Buyers and shall hold Buyers harmless from any losses,
costs and/or expenses which Buyers (or any thereof) sustain or incur arising from the
reemployment of funds obtained by Buyers hereunder or from fees payable to terminate
the deposits from which such funds were obtained, in each case for the remainder of the
applicable 30-day period (“Breakage Costs”). Each Buyer claiming Breakage
Costs from any Seller shall deliver to such Seller a statement setting forth the amount
and basis of determination of such Breakage Costs in such detail as determined in good
faith by such Buyer or its designee to be adequate, it being agreed that such statement
and the method of its calculation shall be adequate and shall be conclusive and binding
upon such Seller, absent manifest error. This Section shall survive termination of
this Agreement and the repurchase of all Purchased Assets subject to Transactions
hereunder.






	 	e.	 	If on any Purchase Date the Request Amount exceeds the Purchase Price of all
Wet Funded Loans purchased by Buyers on such Purchase Date, Sellers shall pay to Buyers
one day’s accrued interest on such excess at the related Default Rate on the Business
Day immediately following such Purchase Date.






	 	f.	 	Anything herein to the contrary notwithstanding, no Buyer shall cause a
Repurchase Date to occur under Section 3(b)(i)(B) in respect of any Transaction with
any Seller other than for the purpose of changing the designation of a Purchased Asset
subject to such Transaction (which shall be identified in the Administrative Agent’s
written demand) (x) from “Group A Purchased Asset” to “Group B Purchased Asset” or (y)
from “Group B Purchased Asset” to “Group A Purchased Asset.” In the case of (x), on
such Repurchase Date, such Seller shall simultaneously (i) repurchase from Senior Buyer
its Senior Purchased Interest (90%) in such Purchased Asset, and from Subordinate Buyer
its Subordinate Purchased Interest (10%) in such Purchased Asset, and (ii) enter into a
new single Transaction (whose Repurchase Date shall coincide with that for the old
Transactions, without giving effect to Section 3(b)(i)(B) hereof) with Subordinate
Buyer, under which such Seller shall assign and transfer such Purchased Asset (100%) to
Subordinate Buyer. In the case of (y), on such Repurchase Date, such Seller
simultaneously shall (iii) repurchase 100% of such Purchased Asset from Subordinate
Buyer and (iv) enter into a new set of Related Transactions (whose Repurchase Date
shall coincide with that for the old Transaction, without giving effect to Section
3(b)(i)(B) hereof) with Buyers pursuant to which such Seller shall assign and transfer
a Senior Purchased Interest (90%) in such Purchased Asset to Senior Buyer, and a
Subordinate Purchased Interest (10%) in such Purchased Asset to Subordinate Buyer. In
the case of both (x) and (y), such Seller shall pay Buyers or, as applicable,
Subordinate Buyer all Price Differential for such Purchased Asset accrued to and unpaid
on the date of such repurchase at the following times: (a) immediately before giving
effect to such repurchase and initiating the new Transaction or new set of Related
Transactions (if such repurchase occurs on a Payment Date for the existing Transaction
or set of Related Transactions); and (b) on the first Payment Date for the new
Transaction or new set of Related Transactions (if such repurchase occurs on a day
other than a Payment Date for the existing Transaction or set of Related Transactions).
Further, in the case of both (x) and (y), the Purchase Price for the Purchased Asset
under the new Transaction or new set of Related Transactions shall be the same as (and
shall be netted against) the Repurchase Price (less the Price Differential, to
the extent paid before such repurchase in accordance with the preceding sentence, or
plus the Price Differential, to the extent not so repaid) for such Purchased Asset
under the old Transaction or Transactions, such that (1) after payment by such Seller
of such Price Differential, such Seller shall not be required to pay to Buyers any
additional amounts on account of such Repurchase Price, and Buyers shall not be
required to pay to such Seller any additional amounts on account of such Purchase Price
and (2) Buyers shall allocate inter sese their respective Senior Buyer’s
Repurchase Price and Subordinate Buyer’s Repurchase Price under the old Transactions
(in the case of (x)), and Senior Buyer’s Purchase Price and Subordinate Buyer’s
Purchase Price under the new set of Related Transactions (in the case of (y)) and shall
make all other necessary adjustments in accordance (mutatis mutandis) with the
last sentence of Section 17(b). All of the foregoing written demand, repurchases,
initiations of new Transactions, redesignations, nettings and allocations shall occur
simultaneously (as aforesaid) and automatically, without any further notice to or
consent of such Seller, and shall be conclusive and binding on such Seller for all
purposes hereunder and under the other Program Documents.






	4.	 	ENTERING INTO THE TRANSACTION; TRANSACTION NOTICE






	 	a.	 	From time to time, (i) Senior Buyer and Subordinate Buyer will enter into
Related Transactions with a Seller for the purchase of specified Purchased Assets then
constituting (in accordance with Buyers’ election referred to in Section 4(b) or 17(b)
hereof) Group A Purchased Assets, exclusively, or both Group A Purchased Assets and
Group B Purchased Assets, in each case for an aggregate price equal to the Purchase
Price for such Purchased Assets and in accordance with the terms and conditions of this
Agreement; and (ii) Subordinate Buyer will enter into a separate Transaction with a
Seller for the purchase of specified Purchased Assets then constituting (in accordance
with Buyers’ election referred to in Section 4(b) or 17(b) hereof) Group B Purchased
Assets, for an aggregate price equal to the Purchase Price for such Purchased Assets in
accordance with the terms and conditions of this Agreement. Pursuant to the terms of
such Transaction or set of Related Transactions, Senior Buyer shall acquire a Senior
Purchased Interest in, and shall pay a Senior Buyer’s Purchase Price for, each such
Purchased Asset; and Subordinate Buyer shall acquire a Subordinate Purchased Interest
in, and shall pay a Subordinate Buyer’s Purchase Price for, each such Purchased Asset.
The obligation of each Buyer to pay for its Purchased Interest a price determined in
accordance with this Section 4(a) shall be several and not joint, and, for the
avoidance of doubt, Sellers and Buyers agree that no Buyer shall, in any event, be
obligated to any Seller for, or on account of, the obligations of any other Buyer
hereunder.






	 	b.	 	All Purchased Assets shall meet or exceed the Underwriting Guidelines, and
shall be serviced by Servicer. The aggregate Purchase Price for all Purchased Assets
for all Outstanding Transactions under this Agreement and the portions thereof paid or
payable by Senior Buyer and by Subordinate Buyer shall not exceed the Maximum Aggregate
Purchase Price, the Maximum Aggregate Senior Purchase Price and the Maximum Aggregate
Subordinate Purchase Price, respectively, each determined pursuant to Section 37
hereof. Unless otherwise agreed, a Seller shall give Buyers and Custodian notice of
any proposed purchase in accordance with the terms of the Custody Agreement (the date
on which such notice is so given, the “Notice Date”). On the Notice Date, such
Seller shall (i) request that Buyers enter into a Transaction or a set of Related
Transactions by furnishing to the Administrative Agent (for distribution to Buyers) and
to Custodian a Transaction Notice and Loan Schedule listing the Purchased Assets to be
purchased and requesting that Senior Buyer and the Subordinate Buyer enter into such
Transaction or set of Related Transactions for the purchase of such Purchased Assets as
aforesaid, (ii) deliver to the Administrative Agent (for its benefit and the benefit of
Buyers) a Computer Medium and (iii) deliver to Custodian the Loan File or Wet Funding
Package for each Loan subject to such Related Transactions.






	 	c.	 	Within one Business Day of receipt of such Transaction Notice and Transaction
Schedule from such Seller, Buyers shall designate and, through the Administrative
Agent, shall notify to such Seller and Servicer which of the Purchased Assets
constitute Group A Purchased Assets and which constitute Group B Purchased Assets, and
shall specify to such Seller the Senior Purchased Interest and the Subordinate
Purchased Interest in each such Purchased Asset, which designation, notification and
specification shall be conclusive and binding on such Seller for all purposes hereunder
and under the other Program Documents. Thereupon such Seller shall enter into a
Transaction or, as applicable, a set of Related Transactions with Buyers with respect
to each such Purchased Asset.






	 	d.	 	In the event that the parties hereto desire to enter. on terms other than as
set forth in the Program Documents, into a Transaction for the assignment and transfer
of Group B Assets by a Seller to Subordinate Buyer, such Seller and Subordinate Buyer
shall execute a “Confirmation” specifying such terms prior to entering into such
Transaction. Any such Confirmation and the related Transaction Notice, together with
this Agreement, shall constitute conclusive evidence of the terms agreed to between
such Seller and Subordinate Buyer with respect to such Transaction. In the event of
any conflict between this Agreement and a Confirmation, the terms of the Confirmation
shall control with respect to the related Transaction.






	 	e.	 	Buyers shall not be obligated to enter into more than three sets of Related
Transactions in any calendar day.






	5.	 	PAYMENT AND TRANSFER






	 	a.	 	Unless otherwise agreed, all transfers of funds hereunder and all payments
hereunder (including payments of any Purchase Price, Repurchase Price, Price
Differential, Margin Payments, Settlement Payments, fees and any other payments) shall
be made in U.S. dollars (in immediately available federal funds). Any and all payments
to Buyers or the Administrative Agent shall be made by Sellers or the Servicer to an
account designated by the Administrative Agent or (if not so designated) at the address
set forth in Section 35 hereof for the giving of notice to the Administrative Agent or
at any other address that may be specified in writing from time to time by the
Administrative Agent. All Purchased Assets assigned and transferred to Buyers shall be
delivered to the Custodian pursuant to the Custody Agreement. Any Repurchase Price or
Price Differential received by any Buyer after 2:30 p.m. New York City time shall be
applied on the next succeeding Business Day.






	 	b.	 	Nothing in this Agreement (including in Section 7 hereof) shall reduce any
Seller’s obligation to pay in full (without duplication) any and all Repurchase Prices
or Price Differentials or to make any and all Margin Payments or Settlement Payments
and any and all other payments on its part to be made pursuant to this Agreement or any
other Program Document.






	6.	 	MARGIN MAINTENANCE; PRICE DIFFERENTIAL; INCOME PAYMENTS






	 	a.	 	Margin Maintenance






	 	(i)	 	If at any time (A) the aggregate Market Value
of all of the Purchased Interests of any Buyer in all Purchased Assets
subject to all Transactions with all Sellers is less than the aggregate
of such Buyer’s Margin Amount for all such Transactions (such
“Buyer’s Margin Deficit”) and (B) the sum of such Buyer’s
Margin Deficit and the other Buyer’s Margin Deficit is at least
$250,000 then upon notice by such Buyer to Sellers of the existence and
amount of such Buyer’s Margin Deficit, Sellers shall assign and
transfer to such Buyer (subject to the requirements of Sections 4 and
9(b) hereof) cash and, at such Buyer’s option (and provided Sellers
have additional Eligible Assets), additional Eligible Assets
(“Additional Purchased Assets”), so that, after giving effect
to such assignment and transfer, the sum of the cash and the aggregate
Market Value of such Buyer’s Purchased Interests in such Purchased
Assets (including any such Additional Purchased Assets) will equal or
exceed such aggregate of such Buyer’s Margin Amount (such requirement,
a “Margin Call”).






	 	(ii)	 	Notice required pursuant to Section 6(a)(i) may
be given by any means provided in Section 35 hereof. Any notice given
before 10:00 a.m. New York time on a Business Day shall be satisfied no
later than 5:00 p.m. New York time on the same Business Day. Any
notice given after 10:00 a.m. New York time shall be satisfied no later
than 5:00 p.m. on the Business Day following the date of such notice.
Sellers, Guarantor and Buyers each agree that (A) the failure of any
Buyer, on any one or more occasions, to exercise its rights hereunder,
or under any other Program Documents, shall not change or alter the
terms and conditions to which this Agreement or the other Program
Documents are subject or limit the right of such Buyer to do so at a
later date; and (B) a failure or delay by any Buyer to exercise its
rights hereunder, or under any other Program Documents shall not limit
or waive such Buyer’s rights under this Agreement, any of the other
Program Documents, or otherwise existing by law, and shall not, in any
way, create additional rights for any Seller or the Guarantor.






	 	b.	 	Price Differential






Each Seller shall pay to each Buyer, in respect of each Transaction or set of Related
Transactions for any Purchased Assets, the Price Differential applicable to such Buyer on
each Payment Date and on the Repurchase Date for such Transactions and such Purchased
Assets, in the amounts and at the times set forth in Section 3(c) hereof.




	 	c.	 	Income Payments






	 	(i)	 	Income paid or payable in respect of any
Purchased Assets subject to any Transaction or set of Related
Transactions (including, without limitation, all Income received or
receivable by or on behalf of the related Seller with respect to such
Purchased Assets), (A) shall be the property of Buyers according to
their respective Purchased Interests in each such Purchased Asset, and
(B) shall secure such Seller’s Obligations to the Administrative Agent
and Buyers (whether arising under any such, or any other, Transaction
or set of Related Transactions) in accordance with Section 8 hereof and
subject to the subordination and priority of payments set forth in
Section 7 hereof.






	 	(ii)	 	Each Seller shall cause to be paid either to
itself or directly to the Servicer any and all Income on or in respect
of Purchased Assets subject to Transactions to which such Seller is a
party. Within two Business Days of receiving any such Income (whether
directly from Borrowers or from any Seller), the Servicer shall deposit
such Income (in such funds as so received, or in immediately available
funds, and in the full amount so received) into the Collection Account.
The Servicer shall also deposit into the Collection Account such
additional funds, at such times, as specified in Annex III hereto. For
so long as any Seller or the Servicer shall hold any Income which, in
accordance with this paragraph (ii), is required to be deposited into
the Collection Account, such Seller and, as applicable, the Servicer
shall segregate such Income from its own funds, and shall hold such
Income for the benefit of, and in trust for, Buyers and the
Administrative Agent.






	 	(iii)	 	The Servicer and the Administrative Agent
shall be entitled to distributions from the Collection Account at such
times, in such amounts, and on such other terms and conditions as
specified in the Account Agreement and summarized and supplemented in
Section 6 of the Custody Agreement, according to which






(A) so long as UBC shall not have received a Notice of
Default (other than a Notice of Default that shall have been
withdrawn by the Administrative Agent) in the manner
specified in the Account Agreement, UBC shall remit to the
Servicer such portion of each amount so deposited as the
Servicer shall request (up to the total amount then on
deposit in the Collection Account) within one (1) Business
Day of deposit thereof into the Collection Account and from
time to time thereafter.




(B) After UBC shall have received a Notice of Default in
the manner specified in the Account Agreement (and so long as
the Administrative Agent shall not have withdrawn such Notice
of Default), UBC shall remit all amounts in the Collection
Account to the Administrative Agent or to such other Person
as the Administrative Agent may direct (in each case, for
distribution pursuant to the second paragraph of each of
Sections 7.II.A and 7.II.B hereof, but subject, in any event,
to paragraph (iv) below).




	 	(iv)	 	Anything herein to the contrary
notwithstanding, in the circumstances indicated in the second
grammatical paragraph of each of Sections 7.II.A and 7.II.B hereof, the
funds and Property in the Collection Account, and all proceeds of any
and all dispositions of Purchased Assets and Collateral referred to in
such paragraphs, shall be transferred to the Administrative Agent at
the times and in the manner set forth in such paragraphs.






	 	(v)	 	Without prejudice to the survival of Sellers’
and the Servicer’s obligations under the Program Documents at the times
or during the periods referred to below or any other times or periods,
the obligations of Sellers and the Servicer set forth in paragraphs
(ii) and (iv) above, this paragraph (v) and Annex III hereto shall
remain in full force and effect whether or not (A) an Event of Default
shall have occurred and be continuing, (B) UBC has received a Notice of
Default, or (C) any Notice of Default has been withdrawn.






	7.	 	PURCHASED-ASSET AND COLLATERAL SUBORDINATION; PRIORITY OF PAYMENTS






The right, title and interest (including ownership interests and security interests) of
each of the Administrative Agent, Buyers and Sellers (each, a “Claimant”) in and to any
Purchased Asset (including any Purchased Interest therein) and any item of Collateral shall
be either senior and prior in right of payment or, as applicable, subordinate and junior in
right of payment, to the right, title and interest of any other Claimant in such Purchased
Asset and item of Collateral in the manner and to the extent set forth in this Section 7.
In furtherance whereof, Claimants whose payment priority under Section 7.II.A or 7.II.B
hereof is higher than the payment priority of other Claimants shall be senior to such other
Claimants to the extent set forth in such higher priority.




	 	I.	 	Subordination. As further (and except as otherwise) indicated in
Section 7. II hereof,






	 	(i)	 	the right, title and interest of the
Administrative Agent (to the extent of any claims set forth in Section
7.II.A hereof) and Senior Buyer in and to Purchased Assets and
Collateral relating to any Seller constituting Group A Purchased Assets
shall be senior and prior in right of payment to the right, title and
interest therein of the Administrative Agent (to the extent of any
claims set forth in Section 7.II.B hereof), Subordinate Buyer or such
Seller;






	 	(ii)	 	the right, title and interest of the
Administrative Agent (to the extent of any claims set forth in Section
7.II.B hereof) and Subordinate Buyer in and to Purchased Assets and
Collateral constituting Group A Purchased Assets relating to any Seller
shall be senior and prior in right of payment to the right, title and
interest therein of such Seller;






	 	(iii)	 	the right, title and interest of the
Administrative Agent (to the extent of any claims set forth in Section
7.II.B hereof) and Subordinate Buyer in and to Purchased Assets and
Collateral constituting Group B Purchased Assets relating to any Seller
shall be senior and prior in right of payment to the right, title and
interest therein of the Administrative Agent (to the extent of any
claims set forth in Section 7.II.A hereof), Senior Buyer or such
Seller;






	 	(iv)	 	the right, title and interest of the
Administrative Agent (to the extent of any claims set forth in
Section 7.II.A hereof), and Senior Buyer in and to Purchased Assets and
Collateral constituting Group B Purchased Assets relating to any Seller
shall be senior and prior in right of payment to the right, title and
interest therein of such Seller.






	 	II.	 	Priority of Payments






	 	A.	 	Group A Purchased Assets






Except as otherwise provided in the following paragraph, all payments constituting or
in respect of Purchased Assets or Collateral which are Group A Purchased Assets and are
received or receivable from time to time by the Administrative Agent or any Buyer from any
Seller or, on behalf of such Seller, from the Guarantor, the Servicer or otherwise, in
respect of any Seller’s Obligations (including any such payments received from the
Collection Account, whether originally deposited into the Collection Account and required to
be remitted to the Administrative Agent, whether pursuant to Section 6 hereof or otherwise
or consisting of or resulting from Income on investments of the funds and Property from time
to time in the Collection Account on account of such Seller’s Obligations) on or before any
Payment Date or Repurchase Date (and not theretofore applied on or in respect of any
previous Payment Date or Repurchase Date), shall be applied in the following order of
priority to such Seller’s Obligations:




	 	(i)	 	first, to the payment of all of the fees,
indemnification payments, costs and expenses that are due and payable
by such Seller to the Custodian under the Custody Agreement on such
Payment Date or Repurchase Date with respect to the Purchased Assets of
such Seller (whether consisting of Group A Purchased Assets or Group B
Purchased Assets);






	 	(ii)	 	[Reserved];






	 	(iii)	 	third, to the payment of all (A) related
expenses, (B) fees and (C) indemnification payments that are due and
payable by such Seller to (x) the Administrative Agent, in each case,
which, as of such Payment Date or Repurchase Date, have not been paid
within 30 days of the receipt by such Seller of a written invoice
issued by the Administrative Agent and (y) the other parties (other
than the Servicer) under or in respect of this Agreement and the other
Program Documents on such Payment Date, in each case, with respect to
the Purchased Assets of such Seller constituting Group A Purchased
Assets;






	 	(iv)	 	[Reserved];






	 	(v)	 	fifth, to the payment of all of the accrued and
unpaid Price Differential of such Seller due and payable to Senior
Buyer on such Payment Date or Repurchase Date;






	 	(vi)	 	sixth, to the payment of the Buyer’s Margin
Deficit due and payable by such Seller to Senior Buyer on such Payment
Date or Repurchase Date;






	 	(vii)	 	seventh, on each Repurchase Date, to the
payment of the Senior Buyer’s Repurchase Price then due and payable by
such Seller to Senior Buyer, until such Senior Buyer’s Repurchase Price
(to the extent not theretofore paid) has been paid in full;






	 	(viii)	 	eighth, on each Payment Date and each Repurchase Date, to cover any
shortfall in the Collection Account for application in accordance with
(and in the order of priority set forth in) priorities first
through sixth (clauses (i) through (vi)) set forth in the first
paragraph of Section 7.II.B hereof; and






	 	(ix)	 	ninth, to such Seller, provided, that no
Default or Event of Default with respect to such Seller shall then have
occurred and be continuing.





All proceeds of any and all dispositions of Purchased Assets and Collateral which constitute
Group A Purchased Assets and are received or receivable by the Administrative Agent, or any Buyer
at any time and from time to time, following the occurrence and during the continuance of an Event
of Default, pursuant to Section 19 hereof, and all other payments received or receivable by the
Administrative Agent, or any Buyer, or available to be applied, at any time upon the occurrence and
during the continuance of an Event of Default (including payments referred to in the preceding
paragraph) in respect of any Seller shall be applied, as and when received (whether or not a
Payment Date or a Repurchase Date), to such Seller’s Obligations in the order of priority set forth
in clauses (iD) through (xiD) below (it being understood that no payment shall be made at any time
at any such level of priority until all Obligations of such Seller at higher priorities which are
then due and payable, or are then accrued or outstanding, have been paid in full, and no payment
shall be made to any Seller except in accordance with clause (xiD) below:




	 	 	 	(iD) first, to the payment of all of the fees, costs and expenses
(excluding indemnification payments) that are then due and payable (or are then
accrued or outstanding) by such Seller to the Custodian under the Custody
Agreement with respect to the Purchased Assets of such Seller (whether
consisting of Group A Purchased Assets or Group B Purchased Assets);






	 	 	 	(iiD) [Reserved];






	 	 	 	(iiiD) third, to the payment of all (A) related expenses and (B) fees (excluding
indemnification payments) that are then due and payable (or are then accrued or
outstanding) by such Seller to (x) the Administrative Agent, and (y) the other
parties (other than the Servicer) under or in respect of this Agreement and the
other Program Documents, in each case, with respect to the Purchased Assets of
such Seller constituting Group A Purchased Assets;






	 	 	 	(ivD) fourth, to the payment of the Administrative Agent’s Event of
Default Costs theretofore incurred as a result of such Event of Default with
respect to Group A Purchased Assets;






	 	 	 	(vD) fifth, (A) to the payment in full of any and all unpaid Event
of Default Costs theretofore incurred, as a result of such Event of Default, by
Senior Buyer; and (B) next, to the payment of all of the theretofore accrued
and unpaid Price Differential owing by such Seller to Senior Buyer;






	 	 	 	(viD) sixth, to the payment of the Buyer’s Margin Deficit then due
and payable by such Seller to Senior Buyer;






	 	 	 	(viiD) seventh, to the payment of the Senior Buyer’s Repurchase Price then payable
by such Seller to Senior Buyer, until such Senior Buyer’s Repurchase Price (to
the extent not theretofore paid) has been paid in full;






	 	 	 	(viiiD) eighth, (A) to the payment of indemnification payments that are then due and
payable (or are then accrued or outstanding) by such Seller to the Custodian
under the Custody Agreement with respect to the Purchased Assets of such Seller
(whether consisting of Group A Purchased Assets or Group B Purchased Assets);
and (B) next, to the payment of all indemnification payments that are then due
and payable (or are then accrued or outstanding) by such Seller to (x) the
Administrative Agent, and (y) the other parties (other than the Servicer) under
or in respect of this Agreement and the other Program Documents, in each case,
with respect to the Purchased Assets of such Seller constituting Group A
Purchased Assets;






	 	 	 	(ixD) [Reserved];






	 	 	 	(xD) tenth, to cover any shortfall in the Collection Account or in
the proceeds of any and all dispositions of Purchased Assets and Collateral
constituting Group B Purchased Assets for application in accordance with (and
in the order of priority set forth in) priorities first through
sixth (clauses (iD) through (viD)) of the second paragraph of Section
7.II.B hereof; and






	 	 	 	(xiD) eleventh, to such Seller, provided, that no payment shall be
made to such Seller or any Seller (whether pursuant to this clause (xiD) or
otherwise) until the earlier of the first day on which no Default or Event of
Default shall be continuing and on which (following the Termination Date) all
of the Sellers’ Obligations and the Guarantor’s obligations hereunder and under
the other Program Documents shall have been paid in full.






	 	B.	 	Group B Purchased Assets






Except as otherwise provided in the following paragraph, all payments constituting or
in respect of Purchased Assets or Collateral which are Group B Purchased Assets and are
received or receivable from time to time by the Administrative Agent or any Buyer from any
Seller or, on behalf of such Seller, from the Guarantor, the Servicer or otherwise, in
respect of any Seller’s Obligations (including any such payments received from the
Collection Account, whether originally deposited into the Collection Account and required to
be remitted to the Administrative Agent, whether pursuant to Section 6 hereof or otherwise
or consisting of or resulting from Income on investments of the funds and Property from time
to time in the Collection Account on account of such Seller’s Obligations) on or before any
Payment Date or Repurchase Date (and not theretofore applied on or in respect of any
previous Payment Date or Repurchase Date), shall be applied in the following order of
priority to such Seller’s Obligations:




	 	(i)	 	[Reserved];






	 	(ii)	 	second, to the payment of all (A) related
expenses, (B) fees and (C) indemnification payments that are due and
payable by such Seller to (x) the Administrative Agent, in each case,
which, as of such Payment Date or Repurchase Date, have not been paid
within 30 days of the receipt by such Seller of a written invoice
issued by the Administrative Agent and (y) the other parties (other
than the Servicer) under or in respect of this Agreement and the other
Program Documents on such Payment Date, in each case, with respect to
the Purchased Assets of such Seller constituting Group B Purchased
Assets;






	 	(iii)	 	[Reserved];






	 	(iv)	 	fourth, to the payment of all of the accrued
and unpaid Price Differential due and payable by such Seller to
Subordinate Buyer on such Payment Date or Repurchase Date;






	 	(v)	 	fifth, to the payment of the Buyer’s Margin
Deficit due and payable by such Seller to Subordinate Buyer on such
Payment Date or Repurchase Date;






	 	(vi)	 	sixth, on each Repurchase Date, to the payment
of the Subordinate Buyer’s Repurchase Price then due and payable by
such Seller to Subordinate Buyer, until such Subordinate Buyer’s
Repurchase Price (to the extent not theretofore paid) has been paid in
full;






	 	(vii)	 	seventh, on each Payment Date and each
Repurchase Date, to cover any shortfall in the Collection Account for
application in accordance with (and in the order of priority set forth
in) priorities first through seventh (clauses (i)
through (vii)) of the first paragraph of Section 7.II.A hereof; and






	 	(viii)	 	eighth, to such Seller, provided, that no Default or Event of Default
with respect to such Seller shall then have occurred and be continuing.





All proceeds of any and all dispositions of Purchased Assets and Collateral which constitute
Group B Purchased Assets and are received or receivable by the Administrative Agent or any Buyer at
any time and from time to time, following the occurrence and during the continuance of an Event of
Default, pursuant to Section 19 hereof, and all other payments received or receivable by the
Administrative Agent or any Buyer, or available to be applied, at any time upon the occurrence and
during the continuance of an Event of Default (including payments referred to in the preceding
paragraph) in respect of any Seller shall be applied, as and when received (whether or not a
Payment Date or a Repurchase Date), to such Seller’s Obligations in the order of priority set forth
in clauses (iD) through (viiiD) below (it being understood that no payment shall be made at any
time at any such level of priority until all Obligations of such Seller at higher priorities which
are then due and payable, or are then accrued or outstanding, have been paid in full, and no
payment shall be made to any Seller except in accordance with clause (viiiD) below:




	 	 	 	(iD) [Reserved];






	 	 	 	(iiD) second, to the payment of all (A) related expenses, (B) fees
and (C) indemnification payments that are then due and payable (or are then
accrued or outstanding) by such Seller to (x) the Administrative Agent, and (y)
the other parties (other than the Servicer) under or in respect of this
Agreement and the other Program Documents, in each case, with respect to the
Purchased Assets of such Seller constituting Group B Purchased Assets;






	 	 	 	(iiiD) third, to the payment of the Administrative Agent’s Event of Default Costs
theretofore incurred as a result of such Event of Default with respect to Group
B Purchased Assets;






	 	 	 	(ivD) fourth, (A) to the payment in full of any and all unpaid Event
of Default Costs theretofore incurred by Subordinate Buyer; and, next, to the
payment of all of the theretofore accrued and unpaid Price Differential owing
by such Seller to Subordinate Buyer;






	 	 	 	(vD) fifth, to the payment of the Buyer’s Margin Deficit then due
and payable by such Seller to Subordinate Buyer;






	 	 	 	(viD) sixth, to the payment of the Subordinate Buyer’s Repurchase
Price payable by such Seller to Subordinate Buyer, until such Subordinate
Buyer’s Repurchase Price (to the extent not theretofore paid) has been paid in
full;






	 	 	 	(viiD) seventh, to cover any shortfall in the Collection Account or in the proceeds
of any and all dispositions of Purchased Assets and Collateral constituting
Group A Purchased Assets for application in accordance with (and in the order
of priority set forth in) priorities first through ninth
(clauses (iD) through (ixD)) of the second paragraph of Section 7.II.A hereof;
and






	 	 	 	(viiiD) eighth, to such Seller, provided, that no payment shall be made to such
Seller or any Seller (whether pursuant to this clause (viiiD) or otherwise)
until the earlier of the first day on which no Default or Event of Default
shall be continuing and on which (following the Termination Date) all of the
Sellers’ Obligations and the Guarantor’s obligations hereunder and under the
other Program Documents shall have been paid in full.





All rights, title and interest (including ownership interests and security interests) of any
and all Claimants, all obligations of Claimants to any other Claimants under this Section 7, and
all Obligations of Sellers shall remain in full force and effect irrespective of any Seller’s
bankruptcy or insolvency or any other proceeding of a type referred to in Section 18(f) or 18(g)
hereof brought by or against any Seller and irrespective of any circumstance that might otherwise
constitute a defense available to, or a discharge of, any Seller, Claimant or any subordinate
creditor or any surety. The provisions of this Section 7 constitute a continuing agreement and
shall remain in full force and effect until the payment in full (following the Termination Date) of
all Obligations.




	8.	 	SECURITY INTEREST





Sellers and Buyers intend that the Transactions hereunder be sales to Buyers of the Purchased
Assets (and, specifically, sales to each Buyer of Purchased Interests in Purchased Assets) and not
loans from Buyers to Sellers secured by the Purchased Assets (or by Purchased Interests therein).
However, in order to preserve each Buyer’s rights under this Agreement in the event that a court or
other forum recharacterizes the Transactions hereunder as other than sales, and, in addition, in
order to further secure Sellers’ performance of all of their Obligations, each Seller (each, a
“Grantor”) hereby grants the Administrative Agent, for its benefit and the benefit of
Buyers, a security interest in all of its right, title and interest in and to the following
Property ((i) wherever located and however held, (ii) whether now existing or owned by such Grantor
or hereafter arising or acquired, (iii) whether consisting of notes, including notes secured by
real estate, instruments, chattel paper, payment intangibles and other general intangibles, deposit
accounts and trust accounts, including all funds therein, supporting obligations and any and all
proceeds of Collateral as defined below, (iv) whether the Grantor’s Obligations secured by such
Property arise in a Transaction or set of Related Transactions the same as, or different from, the
Transactions in which such Property is assigned and transferred pursuant to Section 4 hereof, and
(v) whether or not the holder of the security interest in such Property is the same Person as the
buyer of such Property in such Transaction or set of Related Transactions) (such right, title and
interest in and to Property being the “Collateral”): the Purchased Assets (including all
Purchased Interests therein) which are subject to a Transaction or set of Related Transactions (it
being understood that the Administrative Agent’s security interest in each Purchased Asset shall be
for the benefit of each Buyer, whether or not such Buyer has a Purchased Interest in such Purchased
Asset), the related Records, all mortgage guaranties and insurance relating to the Purchased Assets
(issued by governmental agencies or otherwise) and any mortgage insurance certificate or other
document evidencing such mortgage guaranties or insurance relating to the Purchased Assets and all
claims and payments thereunder, any purchase agreements or other agreements or contracts relating
to or constituting any or all of the foregoing, the Collection Account, the Funding Account and the
Escrow Accounts (as defined in Annex III hereto), and all monies, investments, Income and other
Property from time to time on deposit in the Collection Account, the Funding Account and the Escrow
Accounts, all other insurance policies and insurance proceeds relating to any Purchased Asset or
the related Mortgaged Property, any assigned Hedge Instrument, any securities account, all rights
to Income, all Servicing Rights and all rights to enforce such payments arising from any of the
Purchased Assets, and any and all replacements, substitutions, distributions on or proceeds with
respect to any Collateral. Each Seller agrees to execute, deliver and file such documents and
perform such acts as may be reasonably necessary to fully perfect the Administrative Agent’s
security interest created hereby in favor of Buyers. Furthermore, each Seller hereby authorizes
the Administrative Agent and each Buyer to file financing statements relating to the Purchased
Assets without the signature of any Seller, as applicable, at its option, as it deems appropriate.
Sellers shall pay the filing costs for any financing statement or statements prepared pursuant to
this Section.



Each security interest granted, under this Section 8, by any Grantor to the Administrative
Agent or any Buyer in any Collateral constituting any Purchased Asset, shall be and remain in full
force and effect, irrespective of the assignment and transfer of such Purchased Asset to the other
Buyer in a Transaction entered into pursuant to Section 4 hereof, all in accordance with Section
9-315(a) of the Uniform Commercial Code but subject always to the provisions of Section 7 hereof.




	9.	 	CONDITIONS PRECEDENT






	 	a.	 	As conditions precedent to the initial Transaction or set of Related
Transactions, (i) Buyers shall have received, on or before the day of such initial
Transaction or set of Related Transactions, the following, in form and substance
satisfactory to Buyers in their reasonable discretion and duly executed by each party
thereto (as applicable) and (ii) the following shall be true the day of such initial
Related Transactions:






	 	(i)	 	The Program Documents duly executed and
delivered by the parties thereto and being in full force and effect,
free of any modification, breach or waiver;






	 	(ii)	 	Evidence that all other actions necessary or,
in the opinion of the Administrative Agent and Buyers, desirable to
perfect and protect the Administrative Agent’s and each Buyer’s
interest in the Purchased Assets and other Collateral have been taken,
including, without limitation, duly executed and filed Uniform
Commercial Code financing statements on Form UCC-1;






	 	(iii)	 	A certified copy of Sellers’ and Guarantor’s
consents or corporate resolutions, as applicable, approving the Program
Documents and the Transactions thereunder, and all documents evidencing
other necessary corporate action or governmental approvals as may be
required in connection with the Program Documents;






	 	(iv)	 	An incumbency certificate of the secretaries of
Sellers and Guarantor certifying the names, true signatures and titles
of Sellers’ and Guarantor’s representatives duly authorized to request
Transactions hereunder and to execute the Program Documents and the
other documents to be delivered thereunder;






	 	(v)	 	An opinion of Sellers’ and Guarantor’s counsel
as to such matters as Buyers may reasonably request and in form and
substance acceptable to Buyers;






	 	(vi)	 	A copy of the Underwriting Guidelines certified
by an officer of NCMC;






	 	(vii)	 	Reserved;






	 	(viii)	 	All of the conditions precedent in the Guaranty shall have been
satisfied;






	 	(ix)	 	Any other documents reasonably requested by
Buyers;






	 	(x)	 	Payment of the Structuring Fee by wire transfer
by the Sellers to the Buyers in immediately available funds; and






	 	(xi)	 	Evidence, in form and substance satisfactory to
Buyers, (i) that the Master Repurchase Agreement dated as of
November 12, 2004 between Sellers and Barclays Bank PLC, as buyer, and
the other “Program Documents” referred to therein have been terminated
and that Sellers have paid to such buyer any and all amounts heretofore
due and payable under such agreement, or (ii) that such termination and
payment are occurring substantially concurrently with the execution and
delivery of this Agreement.






	 	b.	 	The obligation of each Buyer to enter into each Transaction or set of Related
Transactions pursuant to this Agreement is subject to the following conditions
precedent:






	 	(i)	 	The Administrative Agent shall have received
(on behalf of, and for distribution to, each Buyer), on or before the
day of a Transaction with respect to such Purchased Assets (unless
otherwise specified in this Agreement) the following, in form and
substance satisfactory to the Administrative Agent and (if applicable)
duly executed:






(A) A Transaction Notice, Loan Schedule (or Wet Funding
Package with respect to any Wet Funded Loan) and Computer
Medium delivered pursuant to Section 4(a) and covering such
Transaction or set of Related Transactions;




(B) The related Trust Receipt with the Loan Schedule (or
Wet Funding Package with respect to any Wet Funded Loan)
attached;




(C) Such certificates, customary opinions of counsel or
other documents as Buyers may reasonably request, provided
that such opinions of counsel shall not be required in
connection with each Transaction but shall only be required
from time to time as deemed necessary by Buyers or the
Administrative Agent in their reasonable good faith; and




(D) A copy of the Underwriting Guidelines, to the extent
such guidelines have been amended.




	 	(ii)	 	No Default or Event of Default shall have
occurred and be continuing;






	 	(iii)	 	None of Buyers or the Administrative Agent
shall have reasonably determined that a change in any requirement of
law or in the interpretation or administration of any requirement of
law applicable to such Buyer has made it unlawful, and no Governmental
Authority shall have asserted that it is unlawful, for any Buyer to
enter into Transactions with a Pricing Rate based on LIBOR;






	 	(iv)	 	All representations and warranties in the
Program Documents shall be true and correct in all material respects on
the date of such Transaction;






	 	(v)	 	(A) The then aggregate outstanding Purchase
Price for all Purchased Assets subject to all Outstanding Transactions
between Buyers and Sellers, when added to the Purchase Price for the
Purchased Assets subject to such Transaction or set of Related
Transactions and the portions thereof paid or payable by Senior Buyer
and by Subordinate Buyer, shall not exceed the Maximum Aggregate
Purchase Price, the Maximum Aggregate Senior Purchase Price and the
Maximum Aggregate Subordinate Purchase Price, respectively, each
determined pursuant to Section 37 hereof; and (B) the then aggregate
outstanding Purchase Price for any Buyer’s Purchased Interests in all
Purchased Assets subject to all Transactions, when added to the
Purchase Price for such Buyer’s Purchased Interest in the Purchased
Assets subject to such Transaction or set of Related Transactions,
shall not exceed the Maximum Aggregate Senior Purchase Price (if such
Buyer is Senior Buyer) or the Maximum Aggregate Subordinate Purchase
Price (if such Buyer is Subordinate Buyer);






	 	(vi)	 	No event or events shall have been reasonably
determined by any Buyer or the Administrative Agent to have occurred
and be continuing resulting in the effective absence of a whole-loan or
asset-backed-securities market;






	 	(vii)	 	The Administrative Agent and Buyers shall have
determined that all actions necessary to maintain, for their benefit,
the Administrative Agent’s valid and perfected first priority security
interest in the Purchased Assets and the Collateral have been taken,
including, without limitation, duly executed and filed Uniform
Commercial Code financing statements on Form UCC-1;






	 	(viii)	 	The Seller for such Transaction or set of Related Transactions shall
have paid to Buyers and the Administrative Agent any fees or expenses
owed to Buyers or the Administrative Agent, including reimbursement of
Buyers’ and the Administrative Agent’s reasonable outside counsel fees;






	 	(ix)	 	Buyers shall have received any other documents
reasonably requested by Buyers;






	 	(x)	 	Buyers shall have received a copy of any
material changes to the Underwriting Guidelines that have occurred
since the immediately prior Transaction or set of Related Transactions,
and such changes have been approved in writing by Buyers before any
Buyer shall be required to Purchase Loans originated in accordance with
such revised Underwriting Guidelines;






	 	(xi)	 	Buyers shall have determined that there has
been no Material Adverse Change in any Seller or the Guarantor;






	 	(xii)	 	There shall be no Buyer’s Margin Deficit at
the time immediately prior to entering into such Transaction or set of
Related Transactions;






	 	(xiii)	 	Each secured party other than the Administrative Agent or any Buyer
(including any party that has a precautionary security interest in a
Loan) shall have released all of its right, title and interest in, to
and under such Loan (including, without limitation, any security
interest that such secured party or secured party’s agent may have by
virtue of its possession, custody or control thereof) and shall have
filed Uniform Commercial Code termination statements terminating any
Uniform Commercial Code filings made in respect of such Loan, and each
such release and Uniform Commercial Code termination statement shall
have been delivered to Buyers prior to each Transaction or set of
Related Transactions, and to the Custodian as part of the Loan File;
and






	 	(xiv)	 	To the extent the related Seller is selling
Loans which are registered on the MERS System, an Electronic Tracking
Agreement entered into, duly executed and delivered by the parties
thereto and shall be in full force and effect, free of any
modification, breach or waiver.






	10.	 	RELEASE OF PURCHASED ASSETS





(i) Upon, and only upon, timely payment in full by Sellers or Guarantor of the Repurchase
Price and all other Obligations owing with respect to the Purchased Assets subject to any
Transaction or set of Related Transactions, (ii) if no Default or Event of Default has occurred and
is continuing at such time in respect of such or any other Transaction or set of Related
Transactions to which such Seller is a party, and (iii) to the extent that, after giving effect to
all prior and concurrent assignments and transfers of cash, Additional Purchased Assets, and
Substitute Assets (whether pursuant to the last sentence of this Section 10, pursuant to other
Margin Calls or otherwise) and to all prior and concurrent releases pursuant to this Section 10,
the release of such Purchased Assets would not give rise to or perpetuate a Buyer’s Margin Deficit
with respect to any Buyer, then Buyers shall, and shall direct Custodian to, release such Purchased
Assets. Except as set forth in Sections 6(a)(i) and 16, a Seller shall give at least one (1)
Business Day prior written notice to Buyers if such repurchase shall occur on any date other than
the Repurchase Date for such set of Related Transactions set forth in Section 3(b). Buyers shall
provide reasonable cooperation in assisting and directing the Custodian to facilitate the release
of the documents evidencing such Purchased Assets (without expense to Buyers).



To the extent that the release of such Purchased Assets would otherwise give rise to or
perpetuate a Buyer’s Margin Deficit under one or more Transactions with respect to any Buyer,
Buyers shall notify the Sellers party to such Transactions of the amount of such Margin Deficit,
and such Sellers may thereupon satisfy such Margin Calls in the manner specified in Section 6.




	11.	 	RELIANCE





With respect to any Transaction, each Buyer and the Administrative Agent may conclusively rely
upon, and shall incur no liability to Sellers or Guarantor in acting upon, any request or other
communication that Buyers or the Administrative Agent reasonably believe to have been given or
made, on a Seller’s or the Guarantor’s behalf, by a Person authorized to enter into a Transaction.




	12.	 	REPRESENTATIONS AND WARRANTIES





Each of NCCC, NCMC, NCC, Home123 and NCAH (and, in respect of representations and warranties
specifically referencing the Guarantor, the Guarantor) hereby, jointly and severally, represents
and warrants to the Administrative Agent and each Buyer on and as of the date of this Agreement and
each Purchase Date for the purchase of any Purchased Assets by Buyers from a Seller, and shall on
each Repurchase Date be deemed to represent and warrant, that:




	 	a.	 	Due Organization and Qualification. It is duly organized, validly
existing, and in good standing under the laws of the jurisdiction under whose laws it
is organized. It is duly qualified to do business, is in good standing and has
obtained all necessary licenses, permits, charters, registrations, and approvals
necessary for the conduct of its business as currently conducted and the performance of
its Obligations under the Program Documents or any failure to obtain such a license,
permit, charter, registration, or approval will not cause a Material Adverse Effect or
impair the enforceability of any Loan.






	 	b.	 	Power and Authority. It has all necessary power and authority to
conduct its business as currently conducted, to execute, deliver, and perform its
Obligations under the Program Documents and to consummate the Transactions.






	 	c.	 	Due Authorization. The execution, delivery and performance of the
Program Documents by it have been duly authorized by all necessary action and do not
require any additional approvals or consents or other action by or any notice to or
filing with any Person other than any that have heretofore been obtained, given or
made.






	 	d.	 	Noncontravention. None of the execution and delivery of the Program
Documents by it or the consummation of the Transactions and transactions hereunder or
thereunder:






	 	(i)	 	conflicts with, breaches or violates any
provision of any of its material agreements or in any material respect
any law, rule, regulation, order, writ, judgment, injunction, decree,
determination, or award currently in effect having applicability to it
or its properties;






	 	(ii)	 	constitutes a material default by it under any
loan or repurchase agreement, mortgage, indenture, or other agreement
or instrument to which it is a party or by which it or any of its
properties is or may be bound or affected; or






	 	(iii)	 	results in or requires the creation of any
Lien upon or in respect of any of its assets except the Lien relating
to the Program Documents.






	 	e.	 	Legal Proceeding. Except as otherwise disclosed to Buyers in writing
prior to the date of this Agreement, there is no action, proceeding or investigation by
or before any court, governmental or administrative agency or arbitrator affecting any
of the Purchased Assets, it or any of its Affiliates, pending or threatened, which is
reasonably likely to be adversely determined and which, if decided adversely, would
have a reasonable likelihood of having a Material Adverse Effect.






	 	f.	 	Valid and Binding Obligations. Each of the Program Documents to which
it is a party, when executed and delivered by it, will constitute its legal, valid and
binding obligations, enforceable against it, in accordance with their respective terms,
except as such enforceability may be limited by bankruptcy, insolvency, reorganization,
moratorium or other similar laws affecting creditors’ rights generally and general
equitable principles.






	 	g.	 	Financial Statements. The financial statements of Guarantor, copies of
which have been furnished to Buyers, (i) are, as of the dates and for the periods
referred to therein, complete and correct in all material respects, (ii) present fairly
the financial condition and results of operations of the Guarantor as of the dates and
for the periods indicated and (iii) have been prepared in accordance with GAAP
consistently applied, except as noted therein (subject as to interim statements to
normal year-end adjustments). Since the date of the most recent financial statements,
there has been no Material Adverse Change with respect to the Guarantor. Except as
disclosed in such financial statements, the Guarantor is not subject to any contingent
liabilities or commitments that, individually or in the aggregate, have a reasonably
likelihood of causing a Material Adverse Change with respect to the Guarantor.






	 	h.	 	Accuracy of Information. None of the documents or information prepared
by or on behalf of it and provided by it to Buyers and relating to its financial
condition contain any statement of a material fact with respect to it or the
Transactions that was untrue or misleading in any material respect when made. Since
the furnishing of such documents or information, there has been no change, nor any
development or event involving a prospective change known to it, which would render any
of such documents or information untrue or misleading in any material respect.






	 	i.	 	No Consents. No consent, license, approval or authorization from, or
registration, filing or declaration with, any regulatory body, administrative agency,
or other governmental instrumentality, nor any consent, approval, waiver or
notification of any creditor, lessor or other non-governmental person, is required in
connection with its execution, delivery and performance of this Agreement or its
consummation of any other Program Document, other than any that have heretofore been
obtained, given or made.






	 	j.	 	Compliance With Law. No practice, procedure, or policy employed or
proposed to be employed by it in the conduct of its businesses violates any law,
regulation, judgment, regulatory consent, order, or decree applicable to it which, if
enforced, would result in either a Material Adverse Change with respect to it or a
Material Adverse Effect.






	 	k.	 	Solvency: Fraudulent Conveyance. It is solvent and will not be
rendered insolvent by any one or more Transactions under this Agreement (including,
without limitation, its payment, performance and observance of all its Obligations
hereunder and under the other Program Documents), and, after giving effect to each
Transaction, it will not be left with an unreasonably small amount of capital with
which to engage in its business. It does not intend to incur, nor believe that it has
incurred (whether pursuant to this Agreement or the other Program Documents or
otherwise), debts beyond its ability to pay such debts as they mature. It is not
contemplating the commencement of insolvency, bankruptcy, liquidation or consolidation
proceedings or the appointment of a receiver, liquidator, conservator, trustee or
similar official in respect of it or any of their assets. The amount of consideration
being received by it upon the sale of the Purchased Assets (or Purchased Interests
therein) to Buyers constitutes reasonably equivalent value and fair consideration for
such Purchased Assets (and such Purchased Interests). It is not assigning or
transferring any Purchased Assets with any intent to hinder, delay, or defraud any of
its creditors.






	 	l.	 	Investment Company Act Compliance. It is not required to be registered
as an “investment company” as defined under the Investment Company Act nor as an entity
under the control of an “investment company” as defined under the Investment Company
Act.






	 	m.	 	Taxes. It has filed all federal and state tax returns which are
required to be filed and paid all taxes, including any assessments received by it, to
the extent that such taxes have become due (other than for taxes that are being
contested in good faith and for which it has established adequate reserves in
accordance with GAAP). Any taxes, fees, and other governmental charges payable by it
in connection with a Transaction and the execution and delivery of the Program
Documents have been paid.






	 	n.	 	Additional Representations. With respect to each Loan, NCCC, NCMC,
NCC, Home123, and NCAH, jointly and severally, hereby make all of the representations
and warranties set forth in Appendix A to the Custody Agreement as of the date the Loan
File or Wet Funding Package, as applicable, is delivered to the Custodian. Further, as
of each Purchase Date, each Seller shall be deemed to have represented and warranted in
like manner that no Seller has any knowledge that any such representation or warranty
either has ceased or is reasonably likely to cease to be true in a material respect as
of such date, except as otherwise stated in a Transaction Notice, any such exception to
identify the applicable representation or warranty and specify in reasonable detail the
related knowledge of any Seller.






	 	•	 	. No Broker. It has not dealt with any broker, investment banker, agent,
or other Person, except for Buyers and the Administrative Agent, who may be entitled to
any commission or compensation in connection with the sale of Purchased Assets pursuant
to this Agreement; provided, that if it has dealt with any broker, investment banker,
agent, or other Person, except for Buyers and the Administrative Agent, who may be
entitled to any commission or compensation in connection with the sale of Purchased
Assets pursuant to this Agreement, such commission or compensation shall have been paid
in full by it, as applicable.






	 	p.	 	Corporate Separateness.






	 	(i)	 	Its capital is adequate for its business and
undertakings.






	 	(ii)	 	Seller is not engaged in any business
transactions with the Guarantor or any of their Affiliates other than
transactions in the ordinary course of its business on an
“arm’s-length” basis.






	 	(iii)	 	Its funds and assets are not and will not be,
commingled with the funds of any other Person.






	 	q.	 	Underwriting Guidelines. The Underwriting Guidelines provided to
Buyers are the true and correct Underwriting Guidelines of NCMC.






	 	r.	 	Location of Books and Records. The location where it keeps its books
and records, including all computer tapes and records relating to the Purchased Assets
is its respective chief executive office.






	 	s.	 	Adverse Selection. No Seller has selected any Purchased Assets in a
manner so as to adversely affect Buyers’ or any Buyer’s or the Administrative Agent’s
interests.






	 	t.	 	Agreements. None of Sellers, Guarantor, Servicer nor any of their
respective Subsidiaries is a party to any agreement, instrument, or indenture or
subject to any restriction materially and adversely affecting its business, operations,
assets or financial condition, except, to the extent disclosure is required by GAAP, as
disclosed in the financial statements described in this Agreement. None of Guarantor,
Sellers, Servicer nor any of their respective Subsidiaries is in default in the
performance, observance or fulfillment of any of the obligations, covenants or
conditions contained in any agreement, instrument, or indenture which default could
result in a Material Adverse Change with respect to any Seller, the Servicer or the
Guarantor as a whole.






	 	u.	 	ERISA. Each Plan to which a Seller, the Guarantor or their
Subsidiaries make direct contributions, and, to the knowledge of such Seller and the
Guarantor, each other Plan and each Multiemployer Plan, are in compliance in all
material respects with, and have been administered in all material respects in
compliance with, the applicable provisions of ERISA, the Code and any other Federal or
State law.






	 	v.	 	REIT Status. The Guarantor has not engaged in any material “prohibited
transactions” as defined in Section 857(b)(6)(B)(iii) and (C) of the Code. The
Guarantor for its current “tax year” (as defined in the Code) is entitled to a
dividends paid deduction under the requirements of Section 857 of the Code with respect
to any dividends paid by it with respect to each such year for which it claims a
deduction in its Form 1120-REIT filed with the United States Internal Revenue Service
for such year.





The representations and warranties set forth in this Agreement shall survive any and all
assignments and transfers of Purchased Assets (and Purchased Interests therein) to Buyers and shall
continue for so long as any Purchased Assets are subject to this Agreement.




	13.	 	COVENANTS OF SELLERS AND GUARANTOR





Each of NCCC, NCMC, NCC, Home123 and NCAH (and, in respect of covenants specifically
referencing the Guarantor, the Guarantor) hereby, jointly and severally, covenant with Buyers and
the Administrative Agent as follows:




	 	a.	 	Defense of Title. Each Seller and the Guarantor warrants and will
defend the right, title, and interest of each Buyer in and to all Purchased Assets and
all Collateral against all adverse claims and demands.






	 	b.	 	No Amendment or Compromise. Following an Event of Default, without the
prior written consent of Required Buyers, none of Sellers, the Guarantor or those
acting on any Seller’s or the Guarantor’s behalf shall amend or modify, or waive any
term or condition of, or settle or compromise any claim in respect of, any item of the
Purchased Assets (or Purchased Interests therein) or the Collateral, any related rights
or any of the Program Documents, provided that any such party may amend or modify a
Loan if such amendment or modification does not affect the amount or timing of any
payment of principal or interest, extend its scheduled maturity date, modify its
interest rate, or constitute a cancellation or discharge of its outstanding principal
balance and does not materially and adversely affect the security afforded by the real
property, furnishings, fixtures, or equipment securing the Loan.






	 	c.	 	No Assignment. Except as permitted herein, no Seller, Servicer or any
servicer shall sell, assign, transfer or otherwise dispose of, or grant any option with
respect to, or pledge, hypothecate or grant a security interest in or Lien on or
otherwise encumber (except pursuant to the Program Documents), any of the Purchased
Assets or any Purchased Interests or other interests therein, provided that this
Section shall not prevent any of the following: any transfer of Purchased Assets (or
Purchased Interest therein) in accordance with the Program Documents: any Hedging
Instruments for the related Purchased Assets; any servicing arrangement between the
Servicer and Sellers or their Affiliates; and any forward purchase commitment or other
types of take-out commitment for such Purchased Assets.






	 	d.	 	Servicing of Loans. Each Seller shall cause Servicer to service, or
cause to be serviced, all Loans that are part of the Purchased Assets (or Purchased
Interests therein) or the Collateral in accordance with the servicing provisions set
forth in Annex III hereto, pending any delivery of such servicing to Buyers and the
Administrative Agent pursuant to this Agreement, and with accepted and prudent mortgage
servicing practices of prudent mortgage lending institutions which service loans of the
same type as such Loans in the jurisdiction where the related Mortgaged Property is
located and in a manner at least equal in quality to the servicing it provides to Loans
it owns in its portfolio. Sellers shall notify Servicer of Buyers’ interest hereunder,
and Servicer shall be servicer of Loans and shall identify each servicer with respect
to each Purchased Asset and each item of Collateral on a Loan-by-Loan basis. Each
Buyer shall have the right to approve each Servicer and the form of all Servicing
Agreements or servicing side letter agreements. Sellers shall cause each servicer to
hold or cause to be held all escrow funds collected with respect to such Loans in
customary custodial accounts and shall apply the same for the purposes for which such
funds were collected. Each Seller, upon any Buyer’s or the Administrative Agent’s
request, shall provide reasonably promptly to Buyers or the Administrative Agent, for
distribution to Sellers, a letter addressed to and agreed to by each servicer of Loans,
in form and substance reasonably satisfactory to Buyers, advising such servicer of such
matters as Buyers may reasonably request relating to the Loans. If any Seller should
discover that, for any reason whatsoever, a Seller or any Person responsible to Seller
by contract for the administration and/or servicing any such Loan has failed to perform
in any material respect such Seller’s Obligations under the Program Documents or any of
the obligations of such Person with respect to the Purchased Assets, such Seller shall
promptly notify the Administrative Agent.






	 	e.	 	Preservation of Purchased Assets and Collateral; Purchased-Asset and
Collateral Value. Each Seller shall do all things necessary to preserve the
Purchased Assets (and each Purchased Interest therein) and the Collateral so that they
remain subject to a first priority perfected ownership and security interest hereunder.
Without limiting the foregoing, each Seller will comply with all rules, regulations
and other laws of any Governmental Authority and cause the Purchased Assets (and each
Purchased Interest therein) and the Collateral to comply with all applicable rules,
regulations and other laws. Each Seller shall fully perform or cause to be performed
when due all of its Obligations under any and all Purchased Assets (and Purchased
Interests therein) and Collateral or the Program Documents.






	 	f.	 	Maintenance of Papers, Records and Files. Each Seller and the
Guarantor shall require, and each Seller or the Guarantor shall build, maintain and
have available, a complete file in accordance with applicable lending industry custom
and practice for each Purchased Asset (and each Purchased Interest therein) and each
item of Collateral. Each Seller or the Guarantor will maintain or cause to be
maintained all such Records not in the possession of Custodian in good and complete
condition in accordance with applicable industry practices and preserve them against
loss.






	 	(i)	 	Each Seller shall collect and maintain or cause
to be collected and maintained all Records relating to the Purchased
Assets (and each Purchased Interest therein) in accordance with
industry custom and practice, including those maintained pursuant to
the preceding subsection, and all such Records shall be in the
possession of the Custodian, the Servicer, or such Seller unless
Required Buyers otherwise approve. No Seller or Guarantor will allow
any such papers, records or files that are an original or an only copy
to leave Custodian’s possession, except for individual items removed in
connection with servicing a specific Loan, in which event a Seller will
obtain or cause to be obtained a receipt from an authorized officer or
such Seller or Guarantor for any such paper, record or file.






	 	(ii)	 	For so long as any Buyer or the Administrative
Agent has any ownership or other interest in or Lien on any Purchased
Asset (or Purchased Interest therein), each Seller will hold or cause
to be held all related Records in trust, as the custodian and bailee,
for such Buyer and the Administrative Agent. Each Seller shall notify,
or cause to be notified, every other party holding any such Records of
the ownership or other interests and Liens granted hereby.






	 	(iii)	 	Subject to Section 19, upon two (2) Business
Days’ notice from Custodian or Buyers, each Seller shall (x) make any
and all such Records available to Custodian, Buyers or the
Administrative Agent to examine any such Records, either by their own
officers or employees, or by agents or contractors, or both, and make
copies of all or any portion thereof, (y) permit the Administrative
Agent, any Buyer or their authorized agents to discuss the affairs,
finances and accounts of each Seller or the Guarantor with their
respective chief operating officers and chief financial officers and to
discuss the affairs, finances and accounts of each Seller or the
Guarantor with its independent certified public accountants and (z)
provide a Computer Medium.






	 	g.	 	Financial Statements; Accountants’ Reports; Other Information. Each of
Sellers and Guarantor shall keep or cause to be kept in reasonable detail books and
records of account of its assets and business and shall clearly reflect each Buyer’s
Purchased Interest in the Purchased Assets. Each of Sellers and Guarantor shall
furnish, cause the Servicer to furnish or otherwise cause to be furnished or make
electronically available to the Administrative Agent (for the benefit of, and
distribution to, Buyers) the following:






	 	(i)	 	Financial Statements.






(A) as soon as available and in any event within
forty-five (45) calendar days after the end of each calendar
month, the unaudited consolidated balance sheets of NCFC and
its consolidated Subsidiaries as at the end of such period
and the related unaudited consolidated statements of income
and retained earnings and of cash flows for the NCFC and its
consolidated Subsidiaries for such period and the portion of
the fiscal year through the end of such period, accompanied
by a certificate of a Responsible Officer of NCFC, which
certificate shall state that said consolidated, financial
statements fairly present in all material respects the
consolidated financial condition and results of operations of
NCFC and its consolidated Subsidiaries in accordance with
GAAP, consistently applied, as at the end of, and for, such
period (subject to normal year-end adjustments);




(B) as soon as available and in any event within
forty-five (45) calendar days after the end of each fiscal
quarter, the unaudited consolidated balance sheets of NCFC
and its consolidated Subsidiaries as at the end of such
period and the related unaudited consolidated statements of
income and retained earnings and of cash flows for the NCFC
and its consolidated Subsidiaries for such period and the
portion of the fiscal year through the end of such period,
accompanied by a certificate of a Responsible Officer of
NCFC, which certificate shall state that said consolidated,
financial statements fairly present in all material respects
the consolidated financial condition and results of
operations of NCFC and its consolidated Subsidiaries in
accordance with GAAP, consistently applied, as at the end of,
and for, such period (subject to normal year-end
adjustments);




(C) as soon as available and in any event within ninety
(90) days after the end of each fiscal year of NCFC, the
consolidated balance sheets of NCFC and its consolidated
Subsidiaries as at the end of such fiscal year and the
related consolidated statements of income and retained
earnings and of cash flows for the NCFC and its consolidated
Subsidiaries for such year, setting forth in each case in
comparative form the figures for the previous year,
accompanied by an opinion thereon of independent certified
public accountants of recognized national standing, which
opinion and the scope of audit shall be acceptable to the
Required Buyers in their reasonable discretion, shall have no
“going concern” qualification and shall state that said
consolidated financial statements fairly present the
consolidated financial condition and results of operations of
NCFC and its respective consolidated Subsidiaries as at the
end of, and for, such fiscal year in accordance with GAAP;




(D) if applicable, copies of any 10-Ks, 10-Qs, 8-Ks,
registration statements and other Securities and Exchange
Commission (“SEC”) filings by NCFC and the Servicer
(if the Servicer is not consolidated with NCFC), within 5
Business Days after their filing with the SEC; provided,
that, NCFC, the Servicer (if the Servicer is not consolidated
with NCFC) or any Affiliate will provide Buyers with a copy
of the annual 10-K filed with the SEC by NCFC, the Servicer
(if the Servicer is not consolidated with NCFC) or their
respective Subsidiaries, no later than 90 days after the end
of the fiscal year; and




(E) from time to time such other information regarding
the financial condition, operations, or business of NCFC as
Required Buyers may reasonably request.




	 	(ii)	 	Loan Data. Monthly reports in form and
scope satisfactory to Buyers setting forth data regarding the
performance of the Purchased Assets for the immediately preceding
month, and [which shall include, in any event, for each Loan that is
(on the date of such report) or was (in the period since the date of
the previous such report) subject to an Outstanding Transaction, (A)
the Loan identification, (B) the “Current Balance” (reflecting the
principal collections on such Loan since the date of the previous such
report), (C) the “Next Due Date,” and (D) such other information as
Buyers may reasonably request, including, without limitation, any other
information regarding the Purchased Assets reasonably requested by
Buyers, the performance of any Purchased Assets serviced by or on
behalf of Servicer and any other financial information regarding the
Guarantor or the Sellers reasonably requested by Buyers.






	 	(iii)	 	Monthly Servicing Diskettes. On or
before the second Business Day prior to each Payment Date, or at such
other time as Buyers or the Administrative Agent may reasonably request
upon reasonable prior notice, a computer tape or a diskette (or any
other electronic transmission acceptable to the Required Buyers) in a
format acceptable to the Administrative Agent containing such
information with respect to the Purchased Assets as the Required Buyers
may reasonably request.






	 	(iv)	 	Monthly Certification. Each Seller
shall execute and deliver a monthly certification substantially in the
form of Exhibit A-1 attached hereto and the Guarantor shall execute and
deliver a monthly certification substantially in the form of Exhibit
A-2 attached hereto.






	 	h.	 	Notice of Material Events. Each Seller shall promptly inform the
Administrative Agent in writing of any of the following:






	 	(i)	 	any Default, Event of Default or default or
breach by any Seller or the Guarantor under any Program Document or any
other material agreement of any Seller or the Guarantor;






	 	(ii)	 	any material change in the insurance coverage
required of any Seller or the Guarantor or any other Person pursuant to
any Program Document, with copy of evidence of same attached;






	 	(iii)	 	any material dispute, litigation,
investigation, proceeding or suspension between a Seller, the Servicer
or the Guarantor, on the one hand, and any Governmental Authority or
any other Person which would reasonably be expected to result in a
Material Adverse Effect;






	 	(iv)	 	any material adverse change in accounting
policies or financial reporting practices or any change of auditor of a
Seller, the Guarantor or the Servicer;






	 	(v)	 	the occurrence of any material licensing
dispute with respect to any Seller, the Servicer or the Guarantor and a
description of the strategy for resolving it;






	 	(vi)	 	any event, circumstance or condition that has
resulted, or has a reasonable likelihood of resulting, in either a
Material Adverse Change with respect to a Seller, the Servicer or the
Guarantor or a Material Adverse Effect;






	 	(vii)	 	any material change to the credit policies and
practices of either NCFC or NCMC; and






	 	(viii)	 	any material change to the Underwriting Guidelines.






	 	i.	 	Maintenance of Licenses. Each Seller shall maintain all licenses,
permits or other approvals necessary for such Seller or the Guarantor to conduct its
business and to perform its Obligations under the Program Documents, and each Seller
and the Guarantor shall conduct its business strictly in accordance with applicable
law.






	 	j.	 	No Withholdings for Taxes. (i) All payments made by any Seller under
this Agreement or any other Program Documents shall be made free and clear of, and
without deduction or withholding for or on account of, any and all present or future
taxes, levies, imposts, deductions, charges or withholdings, and all liabilities
(including penalties, interest and additions to tax) with respect thereto imposed by
any Governmental Authority thereof or therein, excluding income taxes, branch profits
taxes, franchise taxes or any other tax imposed on any Buyer’s or the Administrative
Agent’s net income by the United States, a state, a foreign jurisdiction under the laws
of which such Buyer or the Administrative Agent is organized or in which its applicable
lending office is located, or any political subdivision thereof, unless such taxes that
would otherwise be excluded are imposed solely as a result of such Buyer’s or the
Administrative Agent’s having executed, delivered or performed its obligations or
received payment under (not including any portion of income taxes payable as a result
of the receipt of payments hereunder), or enforced, this Agreement or any of the other
Program Documents (to the extent so excluded, “Excluded Taxes”; all other taxes
covered by this Section 13(j)(i) being “Non-Excluded Taxes”; and all Non-Excluded Taxes
and Excluded Taxes being, collectively, “Taxes”). If a Seller is required by
law or regulation to deduct or withhold any taxes (other than Excluded Taxes) from or
in respect of any amount payable hereunder or under any other Program Document, to the
Administrative Agent or any Buyer, it shall: (a) make such deduction or withholding;
(b) pay the amount so deducted or withheld to the appropriate Governmental Authority
not later than the date when due; (c) deliver to the Administrative Agent and each
Buyer, promptly, original tax receipts and other evidence satisfactory to the
Administrative Agent and such Buyer of the payment when due of the full amount of such
taxes; and (d) pay to the Administrative Agent and such Buyer such additional amounts
as may be necessary so that, after such Seller has made all required deductions and
withholdings (including deductions and withholdings applicable to additional amounts
payable under this Section 13(j)), the Administrative Agent or such Buyer, as
applicable, receives, free and clear of all taxes, a net amount equal to the amount it
would have received under this Agreement and the other Program Documents, as if no such
deduction or withholding had been made.






	 	(ii)	 	In addition, each Seller hereby agrees to pay
any present or future stamp, recording, documentary, excise, property
or value-added taxes, or similar taxes, charges or levies that arise
from any payment made under or in respect of this Agreement or any
other Program Document to which it is a party or from the execution,
delivery or registration of, any performance under, or otherwise with
respect to, this Agreement or any other Program Document to which it is
a party (collectively, “Other Taxes”).






	 	(iii)	 	Each Seller hereby agrees to indemnify each of
the Administrative Agent and Buyers for, and to hold it harmless
against, the full amount of Non-Excluded Taxes and Other Taxes relating
to such Seller, and the full amount of the related Taxes of any kind
imposed by any jurisdiction on amounts payable under this Section 13(j)
imposed on or paid by any Buyer or the Administrative Agent and any
liability (including penalties, additions to tax, interest and
expenses) arising therefrom or with respect thereto. The indemnity by
each Seller provided for in this Section 13(j)(iii) shall apply and be
made whether or not the Non-Excluded Taxes or Other Taxes for which
indemnification hereunder is sought have been correctly or legally
asserted. Amounts payable by each Seller under the indemnity set forth
in this paragraph (iii) shall be paid within ten (10) days from the
date on which Administrative Agent makes written demand therefor.






If and when the Administrative Agent or any Buyer shall receive from
or on behalf of any Seller a full indemnification payment in respect
of any Non-Excluded Tax or other Tax pursuant to this clause (iii)
(an “Indemnified Tax”), then




(A) Upon the request and at the expense of such Seller, the
Administrative Agent or, as applicable, such Buyer shall
exercise commercially reasonable efforts to obtain a refund
of such Indemnified Taxes, but only if, in the judgment of
the Administrative Agent or such Buyer, such exercise shall
not be adverse to the Administrative Agent’s or such Buyer’s
interests; and




(B) If the Administrative Agent or, as applicable, such Buyer
determines, in its sole discretion, that it has received a
refund of any such Indemnified Tax (whether in furtherance of
subclause (A) above or otherwise), the Administrative Agent
or such Buyer shall, as soon as reasonably practicable, remit
to such Seller an amount equal to such refund (but only to
the extent of indemnity payments made by, or on behalf of,
such Seller under this clause (iii) in respect of such
Indemnified Taxes), net of all theretofore unreimbursed
out-of-pocket expenses of the Administrative Agent or such
Buyer, and without interest (other than any interest paid by
the relevant Governmental Authority with respect to such
refund), provided that such Seller, upon the request
of the Administrative Agent or such Buyer, agrees to repay,
as soon as reasonably practicable, the amount paid over to
such Seller (plus any penalties, interest or other charges
imposed by the relevant Governmental Authority) to the
Administrative Agent or such Buyer in the event the
Administrative Agent or such Buyer is required to repay such
refund to such Governmental Authority.



Nothing in the preceding sentence or in the Program Documents shall be construed to require
the Administrative Agent or any Buyer to make available its tax returns (or any other information
relating to its taxes that it deems confidential) to any Seller or any other Person.




	 	(iv)	 	Each Seller shall pay and discharge or cause to
be paid and discharged, when due, all taxes, assessments and
governmental charges or levies imposed upon it or upon its income and
profits or upon any of its property, real, personal or mixed (including
without limitation, the Purchased Assets) or upon any part thereof, as
well as any other lawful claims which, if unpaid, might become a Lien
upon such properties or any part thereof, except for any such taxes,
assessments and governmental charges, levies or claims as are
appropriately contested in good faith by appropriate proceedings
diligently conducted and with respect to which adequate reserves are
provided in accordance with GAAP.






	 	(v)	 	Each Seller shall file on a timely basis
(including any extensions) all federal, and material state and local
tax and information returns, reports and any other information
statements or schedules required to be filed by or in respect of it.






	 	k.	 	Nature of Business. No Seller shall make any material change in the
nature of its business as carried on at the date hereof and other businesses reasonably
related to or arising in connection with Sellers’ existing businesses.






	 	l.	 	Predatory Lending. Sellers will comply with any and all requirements
of any federal, state or local predatory and abusive lending laws applicable to the
origination and servicing of mortgage loans, and each Seller has and shall maintain in
its possession, available for the inspection of Buyers or their designees, and shall
deliver to Buyers or their designees, within a commercially reasonable time period
following a request therefor, evidence of compliance with such requirements.






	 	m.	 	Merger of Guarantor. The Guarantor shall not at any time, directly or
indirectly, (i) liquidate or dissolve or enter into any consolidation or merger or be
subject to a Change in Control without Buyers’ prior written consent; (ii) form or
enter into any partnership, joint venture, syndicate or other combination which would
have a Material Adverse Effect; or (iii) make any Material Adverse Change with respect
to the Guarantor.






	 	n.	 	Insurance. Each Seller will, and shall cause the Servicer to, obtain
and maintain insurance with responsible companies in such amounts and against such
risks as are customarily carried by business entities engaged in similar businesses
similarly situated, and will furnish Buyers on request full information as to all such
insurance, and provide within (15) days after receipt of such request the certificates
or other documents evidencing renewal of each such policy. The Guarantor shall
continue to maintain coverage, for itself and its Subsidiaries (including each Seller
and the Servicer (so long as the Servicer is an Affiliate of the Guarantor)), that
encompasses employee dishonesty, forgery or alteration, theft, disappearance and
destruction, robbery and safe burglary, property (other than money and securities), and
computer fraud in an aggregate amount of at least $1,000,000.






	 	•	 	. Affiliate Transaction. Other than in connection with transfers of
loans with special purpose entities created specifically for financing arrangements
done in the ordinary course of their business, no Seller or Guarantor will at any time,
directly or indirectly, sell, lease or otherwise transfer any property or assets to, or
otherwise acquire any property or assets from, or otherwise engage in any transactions
with, any of their Affiliates unless the terms thereof are no less favorable to such
Seller or Guarantor, as applicable, than those that could be obtained at the time of
such transaction in an arm’s length transaction with a Person who is not such an
Affiliate.






	 	p.	 	Change of Fiscal Year. No Seller or Guarantor will at any time,
directly or indirectly, except upon ninety (90) days’ prior written notice to Buyers,
change the date on which such Seller’s or Guarantor’s fiscal year begins from such
Seller’s or Guarantor’s current fiscal year beginning date.






	 	q.	 	Delivering of Servicing Rights. With respect to the Servicing Rights
of each Loan, Sellers and Guarantor shall deliver such Servicing Rights to the
designees of Buyers, within seventy-five (75) days of the related Purchase Date, unless
otherwise stated in writing by Buyers; provided that on each Repurchase Date that is
subject to a new Transaction, such delivery requirement is deemed restated for such new
Transaction (and the immediately preceding delivery requirement is deemed to be
rescinded) in the absence of directions to the contrary from Buyers, and a new 75-day
period is deemed to commence as of such Repurchase Date. The Sellers’ and Guarantor’s
transfer of the Servicing Rights under this Section shall be in accordance with
customary standards in the industry.






	 	r.	 	Underwriting Guidelines. NCMC shall deliver to Buyers copies of the
Underwriting Guidelines in the event that any material modification is made to such
Underwriting Guidelines within one (1) Business Day after such change.






	 	s.	 	Distributions. If a Default or Event of Default arising from the
failure to make a payment required hereunder, including without limitation, the failure
to satisfy a Margin Call, or to make a payment of Price Differential, Repurchase Price,
margin payment or settlement payment, or any other payment hereunder, has occurred and
is continuing, no Seller or Guarantor shall pay any dividends with respect to any
capital stock or other equity interests in such entity, whether now or hereafter
outstanding, or make any other distribution in respect thereof, either directly or
indirectly, whether in cash or property or in obligations of such Seller or Guarantor.






	 	t.	 	Information. All required financial statements, information and
reports delivered by Guarantor and Sellers to Buyers pursuant to this Agreement shall
be prepared in accordance with GAAP, or, if applicable, with respect to SEC filings,
the appropriate SEC accounting regulations.






	 	u.	 	Hedging. No Affiliate of a Seller or the Guarantor (other than a
Seller or the Guarantor) may enter into Hedge Instruments with respect to the Purchased
Assets.






	 	v.	 	REIT Status. The Guarantor shall, at all times, maintain REIT status.






	14.	 	REPURCHASE DATE PAYMENTS





On each Repurchase Date for each Transaction or, as applicable, set of Related Transactions,
each Seller party thereto shall remit or shall cause to be remitted to each Buyer party thereto,
its respective Buyer’s Repurchase Price.




	15.	 	REPURCHASE OF PURCHASED ASSETS, CHANGE OF LAW






	 	a.	 	Upon discovery by a Seller or the Guarantor of a breach of any of the
representations and warranties set forth in Section 12(n) hereof and Appendix A to the
Custody Agreement, such Seller or the Guarantor shall give prompt written notice
thereof to Buyers. Upon any such discovery by any Buyer or by the Administrative
Agent, such Buyer or, as applicable, the Administrative Agent will notify Sellers. It
is understood and agreed that the representations and warranties set forth in Section
12(n) hereof and Appendix A to the Custody Agreement shall survive delivery of the
respective Loan Files to the Custodian and shall inure to the benefit of Buyers and the
Administrative Agent. The fact that any Buyer or the Administrative Agent has
conducted or has failed to conduct any partial or complete due diligence investigation
in connection with the purchase of any Purchased Asset or any Purchased Interest
therein shall not affect such Buyer’s right to demand repurchase as provided under this
Agreement. A Seller shall within one (1) Business Day of the earlier of a Seller’s or
the Guarantor’s discovery or either a Seller or the Guarantor receiving notice, with
respect to any Purchased Asset or any Purchased Interest therein, of (i) any breach of
a representation or warranty contained in Section 12(n) hereof and Appendix A to the
Custody Agreement or (ii) any failure to deliver any of the items required to be
delivered as part of the Loan File within the time period required for delivery
pursuant to the Custody Agreement, promptly cure such breach or delivery failure in all
material respects. If within one (1) Business Day after the earlier of a Seller’s or
the Guarantor’s discovery of such breach or delivery failure or a Seller or the
Guarantor receiving notice thereof that such breach or delivery failure has not been
remedied by such Seller with respect to such Purchased Assets or any Purchased Interest
therein, such Seller shall promptly upon receipt of written instructions from any
Buyer, at such Buyer’s option, either (i) purchase such Purchased Asset at a purchase
price equal to the Repurchase Price of such Purchased Asset by wire transfer to the
account designated by such Buyer, or (ii) assign and transfer comparable Substitute
Assets to Buyers (in accordance with their respective Purchased Interests), as provided
in Section 16 hereof. The remedies set forth in this Section 15(a) shall be the sole
remedies with respect to a breach of a representation or warranty set forth in Section
12(n) hereof or Appendix A to the Custody Agreement; provided, however, that failure by
a Seller to comply with its Obligations under this Section 15(a) shall have no impact
on Buyers’ ability to determine Market Value with respect to such Purchased Asset and
to make a Margin Call at any time hereunder.






	 	b.	 	If any Buyer determines that the introduction of, any change in, or the
interpretation or administration of any requirement of law has made it unlawful or
commercially impracticable to engage in any Transactions with any Seller with a Pricing
Rate based on LIBOR, a Seller shall, upon its receipt of notice of such fact and demand
from such Buyer (with a copy of such notice to Custodian), repurchase, on the next
succeeding Business Day, the Purchased Assets or, as applicable, any Purchased Interest
therein, which are subject to such Transactions and, at such Seller’s election,
concurrently enter into a new Transaction with such Buyer or, if applicable, a set of
Related Transactions with Buyers with Pricing Rates based on the Base Rate plus such
Buyer’s Applicable Margin (as defined in the Side Letter).






	 	c.	 	If any Buyer determines in its sole discretion that any Change in Law regarding
capital requirements has or would have the effect of reducing the rate of return on
such Buyer’s capital or on the capital of any Affiliate of such Buyer as a consequence
of such Change in Law on this Agreement, then from time to time Sellers will compensate
such Buyer or such Buyer’s Affiliate, as applicable, for such reduced rate of return
suffered as a consequence of such Change in Law on terms similar to those imposed by
such Buyer on its other similarly affected customers. Such Buyer shall provide Sellers
with prompt notice as to any Change in Law. Notwithstanding any other provisions in
this Agreement, in the event of any such Change in Law Sellers will have the right to
terminate all Transactions without any prepayment penalty as of a date selected by
Sellers, which date shall be prior to a Repurchase Date and which date shall thereafter
for all purposes hereof be deemed to be the Repurchase Date.






	 	d.	 	If any Buyer determines in its sole discretion that any Change in Law






	 	(i)	 	shall subject such Buyer to any Tax or increased Tax of any
kind whatsoever with respect to this Agreement, any other Program Document or
any Transaction or change the basis of taxation of payments to such Buyer in
respect thereof; or






	 	(ii)	 	shall impose, modify or hold applicable any reserve, special
deposit, compulsory loan or similar requirement against assets held by,
deposits or other liabilities in or for the account of, advances, or other
extensions of credit by, or any other acquisition of funds by, any office of
any Buyer which is not otherwise included in the determination of the Pricing
Rate based on LIBOR hereunder or under the Side Letter;






and the result of any of the foregoing is to increase the cost to such Buyer, by an
amount which such Buyer deems to be material, of entering, continuing or maintaining
any Transaction or to reduce any amount due or owing hereunder in respect thereof,
then, in any such case, the related Seller shall promptly pay the Administrative
Agent for the benefit of such Buyer, such additional amount or amounts as calculated
by such Buyer in good faith, which shall be conclusive absent manifest error, as
will compensate such Buyer for such increased cost or reduced amount receivable.




	16.	 	SUBSTITUTION





A Seller may, subject to agreement with and acceptance by Buyers, substitute other assets
which are substantially the same as the Purchased Assets (the “Substitute Assets”) for any
Purchased Assets, and assign and transfer to Buyers such Buyers’ respective Purchased Interests in
such Substitute Assets, provided such assignments and transfers shall be subject to the
requirements of Section 4 and Section 9(b) hereof. Such substitution shall be made by assignment
and transfer to Buyers of such Buyers’ respective Purchased Interests in such other Substitute
Assets as aforesaid and by assignment and transfer to such Seller of such replaced Purchased
Assets. Upon and after substitution, the Substitute Assets shall be deemed to be Purchased Assets.




	17.	 	REPURCHASE TRANSACTIONS





a. In furtherance of Section 28 hereof, (i) Subordinate Buyer, as party to any Transaction
covering Group B Purchased Assets may, in its sole discretion, or (ii) Buyers (but not fewer than
all Buyers) party to a set of Related Transactions covering Group A Purchased Assets may, in their
sole election (but subject to their mutual agreement thereto), engage in repurchase transactions
with their respective Purchased Interests in the Purchased Assets subject to such Transaction or
set of Related Transactions, or otherwise pledge, hypothecate, assign, transfer or convey such
Purchased Interests with a counterparty of Buyers’ choice, in all cases (except as otherwise
provided in Section 28 hereof) subject to Subordinate Buyer or, as applicable, Buyers’ Obligation
to reconvey such Purchased Interests (and not substitutes therefor, other than Substitute Assets
assigned and transferred to Buyers pursuant to Section 16 hereof) on the Repurchase Date. In the
event Buyers engage in repurchase transactions with their Purchased Interests in such Purchased
Assets, or in the event they otherwise pledge, hypothecate or convey Purchased Interests, Buyers
shall have the right to assign to their counterparties any of the applicable representations or
warranties in Appendix A to the Custody Agreement and the remedies for breach thereof, as they
relate to such Purchased Assets.



b. Without limiting or being limited by Section 17(a) hereof, and in furtherance of Section 28
hereof, Senior Buyer and Subordinate Buyer may from time to time elect to change the designation of
a Purchased Asset (x) from “Group A Purchased Asset” to “Group B Purchased Asset” or (y) from
“Group B Purchased Asset” to “Group A Purchased Asset.” Following each such redesignation, the
Administrative Agent shall notify the relevant Seller and the Servicer of such redesignation; and
(1) in the case of (x), Senior Buyer shall assign and transfer its Purchased Interest in such
Purchased Asset to Subordinate Buyer, and (2) in the case of (y), Subordinate Buyer shall assign
and transfer to Senior Buyer a Purchased Interest in and to such Purchased Asset equal to the
Senior Purchased Interest Percentage (90%). Each such assignment and such redesignation shall take
effect on the first Business Day to occur concurrently with or immediately after the date on which
such election shall be made and such notification shall be given as aforesaid. Upon any such
assignment and transfer, (i) the Transaction or set of Related Transactions to which such Purchased
Asset was subject immediately prior thereto shall be automatically novated (A) to exclude such
assigned and transferred Purchased Interest from the Purchased Interests of the assignor and to
include them in the Purchased Interests of the assignee, (B)  to substitute the assignee for the
assignor as the Buyer for such Purchased Interest, and (C) to comply with the terms and conditions
of, and make all other changes necessitated by, Section 28 hereof; (ii) the assignor’s aggregate
Purchase Price for its Purchased Assets shall be reduced, and the assignee’s aggregate Purchase
Price for such Purchased Assets shall be increased, by an amount equal to the assignee’s Purchase
Price for such Purchased Asset, (iii) the Price Differential for such assigned and transferred
Purchased Interest shall be based upon (A) the Pricing Rate (or, upon the occurrence and during the
continuance of a Default or Event of Default, the Default Rate) of the assignor (for all periods
prior to the date of such assignment and transfer) and (B) the Pricing Rate (or, upon the
occurrence of an Event of Default, the Default Rate) of the assignee (for all periods from and
after the date of such assignment and transfer), and (iv) all other changes set forth in Section 28
shall take effect. Each such redesignation, notification, assignment and transfer, notification
and each such related adjustment and change referred to above in this Section 17(b) shall be
conclusive and binding on such Seller for all purposes hereunder and under the other Program
Documents.




	18.	 	EVENTS OF DEFAULT





With respect to any Transactions covered by or related to this Agreement, the occurrence of
any of the following events shall constitute an “Event of Default”:




	 	a.	 	a Seller fails to assign and transfer the Purchased Assets, or any Purchased
Interest therein, to any Buyer on the Purchase Date for any Transaction, if such Buyer
has tendered the Purchase Price; provided that delivery of the Wet Funding Package with
respect to any Wet Funded Loan shall satisfy the requirement of delivery of Records on
the Purchase Date for this clause a.;






	 	b.	 	a Seller either fails to repurchase Purchased Assets on the related Repurchase
Date or fails to perform its Obligations under Section 6;






	 	c.	 	either a Seller or the Guarantor shall fail to perform, observe or comply with
any other material term, covenant or agreement contained in the Program Documents
(other than Section 12(n) hereof and Appendix A to the Custody Agreement) and such
failure is not cured within the time period expressly provided or, if no such cure
period is provided, within two (2) Business Days of the earlier of (i) such party’s
receipt of written notice from the Administrative Agent or Custodian of such breach or
(ii) the date on which such party obtains notice or knowledge of the facts giving rise
to such breach;






	 	d.	 	any representation or warranty made by a Seller or the Guarantor (or any of a
Seller’s or the Guarantor’s officers) in the Program Documents or in any other document
delivered in connection herewith or therewith (other than the representations or
warranties in Section 12(n) hereof and Appendix A to the Custody Agreement which shall
be considered solely for the purpose of determining whether the related Loan is an
Eligible Asset, unless a Seller made any such representations or warranties with
knowledge that they were materially false or misleading at the time made or repeated or
deemed to have been made or repeated) shall have been incorrect or untrue in any
material respect when made or repeated or deemed to have been made or repeated;






	 	e.	 	a Seller, the Guarantor, or any of a Seller’s or the Guarantor’s Subsidiaries
shall fail (i) to pay any of such Seller’s, the Guarantor’s or such Seller’s or the
Guarantor’s Subsidiaries’ Indebtedness for borrowed money or under repurchase
agreements or like arrangements, or any interest or premium thereon when due (whether
by scheduled maturity, required prepayment, acceleration, demand or otherwise), or (ii)
to make any payment when due under such Seller’s, the Guarantor’s or such Seller’s or
the Guarantor’s Subsidiaries’ Guarantee of another Person’s Indebtedness for borrowed
money or under repurchase agreements or like arrangements, and, in either case, such
failure shall entitle any related counterparty to declare any such Indebtedness or
Guarantee (in excess of $10,000,000) to be due and payable, or required to be prepaid
(other than by a regularly scheduled required prepayment), prior to the stated maturity
thereof;






	 	f.	 	a custodian, receiver, conservator, liquidator, trustee, sequestrator or
similar official for a Seller, the Guarantor, the Servicer or any of a Seller’s or the
Guarantor’s Subsidiaries, or of any of a Seller’s, the Guarantor’s, the Servicer or
their respective Property (as a debtor or creditor protection procedure), is appointed
or takes possession of such property; or a Seller, the Guarantor or any of a Seller’s,
the Servicer or the Guarantor’s Subsidiaries generally fails to pay a Seller’s, the
Guarantor’s, the Servicer or a Seller’s or the Guarantor’s Subsidiaries’ debts as they
become due; or a Seller, the Guarantor, the Servicer or any of a Seller’s or the
Guarantor’s Subsidiaries is adjudicated bankrupt or insolvent; or an order for relief
is entered under the Federal Bankruptcy Code, or any successor or similar applicable
statute, or any administrative insolvency scheme, against a Seller, the Guarantor, the
Servicer or any of a Seller’s or the Guarantor’s Subsidiaries; or any of Seller’s, the
Guarantor’s, the Servicer or a Seller’s or the Guarantor’s Subsidiaries’ Property is
sequestered by court or administrative order; or a petition is filed against a Seller,
the Guarantor, the Servicer or any of a Seller’s or the Guarantor’s Subsidiaries under
any bankruptcy, reorganization, arrangement, insolvency, readjustment of debt,
dissolution, moratorium, delinquency or liquidation law of any jurisdiction, whether
now or subsequently in effect;






	 	g.	 	a Seller, the Guarantor, the Servicer or any of a Seller’s or the Guarantor’s
Subsidiaries files a voluntary petition in bankruptcy, seeks relief under any provision
of any bankruptcy, reorganization, moratorium, delinquency, arrangement, insolvency,
readjustment of debt, dissolution or liquidation law of any jurisdiction whether now or
subsequently in effect; or consents to the filing of any petition against it under any
such law; or consents to the appointment of or taking possession by a custodian,
receiver, conservator, trustee, liquidator, sequestrator or similar official for a
Seller, the Guarantor, the Servicer or any of a Seller’s or the Guarantor’s
Subsidiaries, or of all or any part of a Seller’s, the Guarantor’s, the Servicer’s or a
Seller’s or the Guarantor’s Subsidiaries’ Property; or makes an assignment for the
benefit of a Seller, the Guarantor, the Servicer or a Seller’s or the Guarantor’s
Subsidiaries’ creditors, or the Guarantor, the Servicer or any Seller admits in writing
its inability to pay its debts as such debts become due;






	 	h.	 	any final, nonappealable judgment or order for the payment of money in excess
of $2,500,000 is rendered against a Seller, the Guarantor or any of a Seller’s or the
Guarantor’s Subsidiaries and remains undischarged or unsatisfied after the passage of
30 days following the date on which it is entered;






	 	i.	 	any Governmental Authority or any person, agency or entity acting or purporting
to act under governmental authority shall have taken any action to condemn, seize or
appropriate, or to assume custody or control of, all or any substantial part of the
Property of a Seller, the Guarantor or the Servicer, or shall have taken any action to
displace the majority of the executive management of Seller, the Guarantor or the
Servicer, or to curtail its authority in the conduct of the business of a Seller, the
Guarantor or the Servicer, or takes any action in the nature of enforcement to remove,
limit or restrict the approval of a Seller, the Guarantor or the Servicer as an issuer,
buyer or a seller/servicer of Loans or securities backed thereby;






	 	j.	 	a Seller, the Guarantor or any of a Seller’s or the Guarantor’s Subsidiaries
shall default under, or fail to perform as requested under, or shall otherwise breach
the material terms of any instrument, agreement or contract (in excess of $10,000,000),
and such default, failure or breach shall entitle any counterparty to declare such
Indebtedness to be due and payable prior to the maturity thereof;






	 	k.	 	in the reasonable good faith judgment of Buyers, any Material Adverse Change
shall have occurred with respect to a Seller or the Guarantor;






	 	l.	 	a Seller or the Guarantor shall admit in writing its inability to, or intention
not to, perform any of such a Seller’s material Obligations or the Guarantor’s material
obligations;






	 	m.	 	except as expressly permitted in this Agreement, a Seller or the Guarantor
dissolves, merges or consolidates with another entity, or sells, transfers, or
otherwise disposes of a material portion of such a Seller’s or the Guarantor’s (as
applicable) business or assets unless Buyers’ written consent is given;






	 	n.	 	this Agreement shall for any reason cease to create or maintain a valid, first
priority security interest or ownership interest upon transfer in any material portion
of the Purchased Assets or Collateral purported to be covered hereby;






	 	•	 	. NCFC’s audited annual financial statements or the notes thereto or other
opinions or conclusions stated therein shall be qualified or limited by reference to
the status of NCFC, Seller or Guarantor as a “going concern” or a reference of similar
import;






	 	p.	 	any of the following shall have occurred without the prior written approval by
Buyer: a Change of Control of a Seller, the Servicer or the Guarantor or the election
of the Guarantor to become a REIT; which in each case has not been approved in writing
by Buyers, such approval with respect to the conversion to a REIT not to be
unreasonably withheld;






	 	q.	 	any default resulting in a Material Adverse Effect shall have occurred and be
continuing under a Servicing Agreement;






	 	r.	 	a Seller shall have failed to comply in any material respect with its
Obligations under the Custody Agreement;






	 	s.	 	any change of a servicer of the Mortgage Loans without the prior consent of the
Buyer;






	 	t.	 	Maximum Indebtedness: The ratio of Total Indebtedness to Tangible Net Worth
will not be greater than 15:1 as of the last day of any fiscal quarter;






	 	u.	 	Minimum Liquidity: at any time, NCFC shall have, on a consolidated basis,
“Liquidity” of at least $60 million;






	 	v.	 	Minimum “Tangible Net Worth”: at any time, Guarantor will maintain Tangible
Net Worth of not less than the sum of (1) $750,000,000, and (2) fifty percent (50%) of
all increases in shareholders’ equity in the Guarantor attributable to issuances of
common stock since November 1, 2004;






	 	w.	 	a default shall have occurred and is continuing under any of the other Program
Documents;






	 	x.	 	a material portion of the Loans for all Transactions were not, for any reason,
originated in accordance with the Underwriting Guidelines in existence at the time such
Loans were originated; and






	 	y.	 	REIT Status. The failure of the Guarantor to at any time to continue
to be (i) qualified as a real estate investment trust as defined in Section 856 of the
Code and (ii) entitled to a dividend paid deduction under Section 857 of the Code with
respect to dividends paid by it with respect to each taxable year for which it claims a
deduction on its Form 1120 – REIT filed with the United States Internal Revenue Service
for such year, or the entering into by NCRC or the Guarantor of any material
“prohibited transactions” as defined in Sections 857(b) and 856(c) of the Code.






	 	z.	 	REIT Status. Failure by the Guarantor to satisfy any of the following
asset or income tests:






	 	(i)	 	At the close of each taxable year, at least 75
percent of such Person’s gross income consists of (i) “rents from real
property” within the meaning of Section 856(c)(3)(A) of the Code, (ii)
interest on obligations secured by mortgages on real property or on
interests in real property, within the meaning of Section 856(c)(3)(B)
of the Code, (iii) gain from the sale or other disposition of real
property (including interests in real property and interests in
mortgages on real property) which is not property described in Section
1221(a)(1) of the Code, within the meaning of Section 856(c)(3)(C) of
the Code, (iv) dividends or other distributions on, and gain (other
than gain from “prohibited transactions” within the meaning of Section
857(b)(6)(B)(iii) of the Code) from the sale or other disposition of,
transferable shares (or transferable certificates of beneficial
interest) in other qualifying REITs within the meaning of Section
856(d)(3)(D) of the Code, and (v) amounts described in Sections
856(c)(3)(E) through 856(c)(3)(I) of the Code.






	 	(ii)	 	At the close of each taxable year, at least 95
percent of such Person’s gross income consists of (i) the items of
income described in paragraph 1 hereof (other than those described in
Section 856(c)(3)(I) of the Code), (ii) gain realized from the sale or
other disposition of stock or securities which are not property
described in Section 1221(a)(1) of the Code, (iii) interest, (iv)
dividends, and (v) income derived from payments to such Person’s on
interest rate swap or cap agreements, options, futures contracts,
forward rate agreements and other similar financial instruments entered
into to reduce the interest rate risks with respect to any indebtedness
incurred or to be incurred to acquire or carry real estate assets, or
gain from the sale or other disposition of such an investment as
described in section 856(c)(5)(G), in each case within the meaning of
Section 856(c)(2) of the Code.






	 	(iii)	 	At the close of each quarter of such Person’s
taxable years, at least 75 percent of the value of such Person’s total
assets (as determined in accordance with Treasury Regulations Section
1.856-2(d)) has consisted of and will consist of real estate assets
within the meaning of Sections 856(c)(4) and 856(c)(5)(B) of the Code,
cash and cash items (including receivables which arise in the ordinary
course of such Person’s operations, but not including receivables
purchased from another person), and government securities.






	 	(iv)	 	At the close of each quarter of each of such
Person’s taxable years, (i) not more than 25 percent of such Person’s
total asset value will be represented by securities (other than those
described in paragraph (iii)), (ii) not more than 20 percent of such
Person’s total asset value will be represented by securities of one or
more taxable REIT subsidiaries, and (iii) (a) not more than 5 percent
of the value of such Person’s total assets will be represented by
securities of any one issuer (other than Government securities and
securities of taxable REIT subsidiaries), and (b) such Person’s will
not hold securities possessing more than 10 percent of the total voting
power or value of the outstanding securities of any one issuer (other
than government securities, securities of taxable REIT subsidiaries,
and securities of a qualified REIT subsidiary within the meaning of
Section 856(i) of the Code).” of any of the REIT qualification tests
pursuant to Section 856(c) of the Code.






	19.	 	REMEDIES





a. Upon the occurrence and during the continuance of an Event of Default, Required Buyers, at
their option (which option shall be deemed to have been exercised immediately upon the occurrence
of an Event of Default pursuant to Section 18(f) or 18(g) hereof without any demand or notice of
any kind to Sellers or any other Person, all of which are hereby waived), shall have any or all of
the following rights and remedies, any or all of which may be exercised by Required Buyers in their
sole discretion:




	 	(i)	 	The Repurchase Date for each Transaction
hereunder shall be deemed immediately to occur.






	 	(ii)	 	Sellers’ Obligations hereunder to repurchase
all Purchased Assets at the Repurchase Price therefor on the Repurchase
Date in such Transactions shall thereupon become immediately due and
payable. Therefore, immediately upon (and, in any event, no later than
the close of business on) such Repurchase Date, Sellers shall
repurchase all Purchased Assets then subject to all Outstanding
Transactions, and shall pay the aggregate amount of Repurchase Prices
therefor; all Income paid after such exercise or deemed exercise shall
be remitted to and retained by Buyers, and applied to the aggregate
Repurchase Prices and any other amounts owing by Sellers hereunder;
Sellers and Guarantor shall immediately deliver to the Buyers or their
designees any and all Records relating to the Purchased Assets subject
to all Transactions then in each Seller’s and the Guarantor’s
possession and/or control; and all right, title and interest in and
entitlement to such Purchased Assets and Servicing Rights thereon shall
be deemed assigned and transferred to Buyers, and Buyers may, at their
option and at the Sellers’ expense, using their reasonable business
judgment, enter into one or more Hedge Instruments covering all or a
portion of the Purchased Assets, and the Sellers shall be responsible
for all damages, judgments, costs and expenses of any kind which may be
imposed on, incurred by or asserted against Buyers relating to or
arising out of such Hedge Instruments; including, without limitation,
any losses resulting from such Hedge Instruments.





If Sellers do not, by the close of business on the Repurchase Date, repurchase all Purchased
Assets at the aggregate Repurchase Price therefor, then Sellers’ rights hereunder to repurchase the
Purchased Assets shall terminate and all right, title and interest in and to the Purchased Assets,
and all Purchased Interests therein, shall vest irrevocably in Buyers (to the extent of their
respective Purchased Interests).



b. Buyers (or the Administrative Agent on their behalf) may (A) sell, on or following the
Business Day following the date on which the Repurchase Price became due and payable pursuant to
Section 19(b), without presentment, demand, protest demand or notice of any kind (all of which are
hereby waived), at a public or private sale (including, without limitation, to the maximum extent
permitted by applicable law, sales to Buyers or their Affiliates, to securitization companies, or
other Persons, or pursuant to other third-party arrangements) and at such price or prices as Buyers
may reasonably deem satisfactory, any or all Purchased Assets and Collateral, or (B) in their sole
discretion elect, in lieu of selling all or a portion of such Purchased Assets or Collateral, to
give Sellers credit for such Purchased Assets or Collateral in an amount equal to the Market Value
of such Purchased Assets or Collateral against the aggregate unpaid Repurchase Price, Margin
Payments, Settlement Payments and any other payments owing by Sellers hereunder. Sellers and the
Guarantor shall remain liable to Buyers and the Administrative Agent for any amounts and
Obligations that remain owing to Buyers or the Administrative Agent following a sale or credit
under the preceding sentence. The proceeds of any sale, lease, license or disposition of, or
foreclosure on Purchased Assets or Collateral shall be applied in accordance with the provisions of
Section 7 hereof.



The parties recognize that it may not be possible to purchase or sell all of the Purchased
Assets on a particular Business Day, or in a transaction with the same purchaser, or in the same
manner because the market for such Purchased Assets may not be liquid. In view of the nature of
the Purchased Assets and the Collateral, the parties agree that liquidation of one or more
Transactions or the underlying Purchased Assets or Collateral, does not require a public purchase
or sale (including those described above) and that a good faith private purchase or sale shall be
deemed to have been made in a commercially reasonable manner. Accordingly, Buyers may elect the
time and manner of accelerating or liquidating any Purchased Asset or Collateral and nothing
contained herein shall obligate Buyers or the Administrative Agent to liquidate any Purchased Asset
upon the occurrence and during the continuance of an Event of Default or to liquidate all Purchased
Assets or Collateral in the same manner or on the same Business Day or constitute a waiver of any
right or remedy of Buyers or the Administrative Agent.



Upon the occurrence and during the continuance of an Event of Default, Buyers and the
Administrative Agent shall have the right to obtain physical possession of the Records and all
other files of the Sellers relating to the Purchased Assets and all documents relating to the
Purchased Assets which are then or may thereafter come into the possession of the Sellers or any
third party acting for the Sellers, and the Sellers shall deliver to Buyers, or to the
Administrative Agent, for its benefit and the benefit of Buyers, such assignments as the
Administrative Agent or any Buyer shall request.



Upon the occurrence and during the continuance of an Event of Default, Buyers may direct the
Administrative Agent, the Servicer, the Custodian, UBC and all other Persons servicing the
Purchased Assets to take such action with respect to the Purchased Assets or the Collateral as
Buyers or the Administrative Agent determine appropriate.



Each Seller and the Guarantor shall cause all proceeds received by it with respect to the
Purchased Assets or the Collateral and consisting of cash, checks, and other near-cash items to be
held in trust for Buyers and the Administrative Agent, segregated from all other funds of Sellers
and Guarantor and immediately delivered to Buyers, the Administrative Agent or their designees, in
the exact form received by such Seller or the Guarantor (duly endorsed by such Seller or Guarantor,
if required).



Upon the occurrence and during the continuance of an Event of Default, Buyers and the
Administrative Agent shall, without regard to the adequacy of the security for the Obligations, be
entitled to the appointment of a receiver by any court having jurisdiction, without notice, to take
possession of and protect, collect, manage, liquidate, and sell the Purchased Assets and any
Collateral or any portion thereof, collect the payments due with respect to the Purchased Assets
and any Collateral or any portion thereof, and do anything that Buyers or the Administrative Agent
are authorized under this Agreement (including this Section 19 and the Annexes to this Agreement)
to do. Sellers shall pay all costs and expenses incurred by Buyers or the Administrative Agent in
connection with the appointment and activities of such receiver.



Buyers and the Administrative Agent may enforce their rights and remedies hereunder without
prior judicial process or hearing, and each Seller hereby expressly waives, to the extent permitted
by law, any right such Seller might otherwise have to require Buyers or the Administrative Agent to
enforce its rights by judicial process. Each Seller also waives, to the extent permitted by law,
any defense any Seller might otherwise have to the Obligations, arising from use of nonjudicial
process, enforcement and sale of all or any portion of the Purchased Assets and any other
Collateral or from any other election of remedies. Each Seller recognizes that nonjudicial
remedies are consistent with the usages of the trade, are responsive to commercial necessity and
are the result of a bargain at arm’s length.



In addition to all the rights and remedies specifically provided herein, Buyers and the
Administrative Agent shall have all other rights and remedies provided by applicable federal,
state, foreign, and local laws (including, without limitation, the Uniform Commercial Code, whether
or not it is actually applicable to this Agreement or the Transactions), whether existing at law,
in equity or by statute, and including, without limitation, (i) any and all rights of Sellers to
demand or otherwise require payment of any amount under, or performance of any provision of, the
Purchased Assets or the Collateral, (ii) the rights and remedies set forth in Section 9-607 of the
Uniform Commercial Code, and (iii) all other rights and remedies with respect to the Purchased
Assets and the Collateral. Each Seller agrees, that, to the extent notice of sale shall be
required by law, at least five days’ notice to such Seller of the time and place of any public sale
or the time after which any private sale is to be made shall constitute reasonable notification.
Buyers and the Administrative Agent shall not be obligated to make any sale of Purchased Assets or
Collateral even if notice of sale shall have been given. Buyers and the Administrative Agent may
adjourn any public or private sale from time to time by announcement at the time and place fixed
therefor, and such sale may, without further notice, be made at the time and place it was so
adjourned.



Any cash held by or on behalf of Buyers or the Administrative Agent, and all cash proceeds
received by or on behalf of Buyers or the Administrative Agent, in respect of any sale of
collection from, or other realization upon all or any part of the Purchased Assets or Collateral
may, in Buyers’ discretion, be held by Buyers and the Administrative Agent as collateral for,
and/or then or at any time thereafter applied in whole or in part against, all or any part of the
Repurchase Price, Margin Payments, Settlement Payments and all other payments due by Sellers
hereunder.



Upon the occurrence and during the continuance of an Event of Default, Buyers and the
Administrative Agent may, without notice to Sellers or the Guarantor, except as required by law,
and at any time or from time to time, charge, set off and otherwise apply any claim against Sellers
or the Guarantor (including all claims on account of all or any part of the Repurchase Price, all
claims for Margin Payments or Settlement Payments, and any and all other payments due Buyers or the
Administrative Agent upon the acceleration of the Agreement or the Sellers’ payment Obligations
hereunder) against any funds obtained from the sale of Purchased Assets or Collateral and all other
cash, securities or other Collateral or Property held by, pledged to, under the control of, or due
from Buyers or the Administrative Agent to margin, guarantee, or settle the Agreement.



Upon the occurrence and during the continuance of an Event of Default, Buyers and the
Administrative Agent shall have, except as otherwise expressly provided in this Agreement, the
right to exercise any of their rights and remedies without presentment, demand, protest or further
notice of any kind (all of which are hereby expressly waived by each Seller), other than as
expressly set forth herein.



Each Seller hereby authorizes Buyers and the Administrative Agent, at such Seller’s expense,
to file such financing statement or statements relating to the Purchased Assets and the Collateral
without such Seller’s signature thereon as Buyers or the Administrative Agent, at their option, may
deem appropriate, and appoints the Administrative Agent as such Seller’s attorney-in-fact to
execute any such financing statement or statements in such Seller’s name and to perform all other
acts which Buyer deems appropriate to perfect and continue the lien and security interest granted
hereby and to protect, preserve and realize upon the Purchased Assets and the Collateral,
including, but not limited to, the right to endorse notes, complete blanks in documents and execute
assignments on behalf of such Seller as its attorney-in-fact. This power of attorney is coupled
with an interest and is irrevocable without Buyer’s consent.



(c) Sellers, the Guarantor and Buyers recognize that the remedies and actions contemplated by this
Section 19 (as exercised by Buyers or the Administrative Agent in their good-faith business
judgment) upon the occurrence and during the continuance of an Event of Default:




(i) are intended to reduce (A) the losses that Buyers would incur as a result of such Event
of Default, (B) the costs and delays that Buyers would incur by entering into transactions
with third parties in order to sell, lease, license, foreclose on, or otherwise dispose of
the Purchased Assets and the Collateral, (C) the amount of claims that Buyers or the
Administrative Agent would be entitled to assert against Sellers and the Guarantor
(reflecting such losses, costs and delays sustained by Buyers, deficiency claims on account
of the Repurchase Price, Margin Deficits, or Margin Payments or Settlement Payments, or
other payments that Buyers were unable to recover from such transactions with third
parties), including related deficiency claims and costs and delays in prosecuting such
claims and indemnity or Guaranty payments to which Buyers may become entitled, and (D) the
losses, costs and delays incurred by Sellers and the Guarantor as a consequence of the
foregoing; and, therefore;




(ii) are in the best interest of Sellers, the Guarantor and Buyers, and are “commercially
reasonable” (within the meaning of Sections 9-610 and 9-627 of the Uniform Commercial Code).




	20.	 	DELAY NOT WAIVER; REMEDIES ARE CUMULATIVE





No failure on the part of Buyers or the Administrative Agent to exercise, and no delay in
exercising, any right, power or remedy hereunder shall operate as a waiver thereof, nor shall any
single or partial exercise by Buyers or the Administrative Agent of any right, power or remedy
hereunder preclude any other or further exercise thereof or the exercise of any other right, power
or remedy. All rights and remedies of Buyers or the Administrative Agent provided for herein are
cumulative and in addition to any and all other rights and remedies provided by law, the Program
Documents and the other instruments and agreements contemplated hereby and thereby, and are not
conditional or contingent on any attempt by Buyers or the Administrative Agent to exercise any of
their rights under any other related document. Buyers and the Administrative Agent may exercise at
any time upon the occurrence and during the continuance of an Event of Default one or more
remedies, as it so desires, and may thereafter at any time and from time to time exercise any other
remedy or remedies.




	21.	 	USE OF EMPLOYEE PLAN ASSETS





No assets of an employee benefit plan subject to any provision of the Employee Retirement
Income Security Act of 1974, as amended (“ERISA”) shall be used by any party hereto in a
Transaction.




	22.	 	INDEMNITY






	 	a.	 	Each Seller agrees, jointly and severally with all other Sellers, to pay on
demand (i) all reasonable out-of-pocket costs and expenses of Buyers and the
Administrative Agent in connection with the preparation, execution, delivery,
modification, administration and amendment of the Program Documents (including, without
limitation, (A) all collateral review and UCC search and filing fees and other expenses
associated with the perfection of the Collateral and (B) the reasonable fees and
expenses of counsel for Buyers and the Administrative Agent in connection with respect
to advising any or all thereof as to their rights and responsibilities, or the
perfection, protection or preservation of rights or interests, under this Agreement,
with respect to negotiations with Sellers, the Guarantor or the Servicer or with other
creditors of Sellers the Guarantor, the Servicer or any of their Subsidiaries, in each
case arising out of any Default, Event of Default or any events or circumstances that
may give rise to a Default or an Event of Default (whether with either or both of the
giving of notice and lapse of time, or otherwise) and with respect to presenting claims
in or otherwise participating in or monitoring any bankruptcy, insolvency or other
similar proceeding involving creditors’ rights generally and any proceeding ancillary
thereto) and (ii) all costs and expenses of Buyers and the Administrative Agent in
connection with the enforcement of this Agreement (including any waivers), whether in
any action, suit or litigation, any bankruptcy, insolvency or other similar proceeding
affecting creditors’ rights generally (including, without limitation, the reasonable
fees and expenses of counsel for Buyers and the Administrative Agent), in each case
whether or not the transactions contemplated hereby are consummated.






	 	b.	 	Each Seller agrees, jointly and severally, with all other Sellers, to indemnify
and hold harmless each of Buyers, the Administrative Agent, their respective
Affiliates, and all officers, directors, employees, agents, attorneys and advisors of
any or all thereof (each Person to be so indemnified being an “Indemnified
Party”) from and against (and will reimburse each Indemnified Party as the same is
incurred) any and all claims, damages, losses, liabilities and expenses (including,
without limitation, reasonable fees and expenses of counsel) that may be incurred by,
or asserted or awarded against any Indemnified Party, in each case arising out of or in
connection with or by reason of (including, without limitation, in connection with any
investigation, litigation or other proceeding (whether or not such Indemnified Party is
a party thereto) relating to, resulting from or arising out of any of the Program
Documents and all other documents related hereto or thereto, any breach of a
representation or warranty of a Seller, the Guarantor, the Servicer or an officer of
any Seller, the Guarantor or the Servicer, under this Agreement or any other Program
Document, and all actions taken pursuant hereto or thereto): (i) Transactions, the
actual or proposed use of the Purchase Price or other proceeds of this Agreement, the
other Program Documents, or any Transactions or the other transactions contemplated
hereby or thereby, including, without limitation, any acquisition or proposed
acquisition or (ii) the actual or alleged presence of hazardous materials on any
Property or any environmental action relating in any way to any Property, except to the
extent that such claim, damage, loss, liability or expense is found in a final,
non-appealable judgment by a court of competent jurisdiction to have resulted from
(x) such Indemnified Party’s gross negligence or willful misconduct or is the result of
a claim made by a Seller or the Guarantor against such Indemnified Party, and that a
Seller or the Guarantor is ultimately the successful party in any resulting litigation
or arbitration or (y) any dispute arising between or among Buyers, the Administrative
Agent or any thereof under this Agreement or the other Program Documents. Each Seller
also agrees not to assert any claim against Buyers, the Administrative Agent or any of
their Affiliates, or any of their respective officers, directors, employees, agents,
attorneys and advisors of any or all thereof, on any theory of liability, for special,
indirect, consequential or punitive damages arising out of or otherwise relating to the
Program Documents, the actual or proposed use of the proceeds of this Agreement, the
other Program Documents, the Transactions or any of the other transactions contemplated
hereby or thereby or any damages arising from the use by unintended recipients of any
information or other materials distributed by it through telecommunications, electronic
or other information transmission systems in connection with this Agreement or the
other Program Documents or the transactions contemplated hereby or thereby.






	 	c.	 	Without limitation on the provisions of Section 4, if any payment of the
Repurchase Price or Price Differential to any Buyer under any Transaction is made by a
Seller other than on the then scheduled Repurchase Date thereto as a result of an
acceleration of the Repurchase Date pursuant to Section 19 or for any other reason,
such Seller shall, except as otherwise provided in Sections 15(c) and 24, upon demand
by such Buyer or the Administrative Agent on such Buyer’s behalf, pay to such Buyer any
Breakage Costs incurred as of a result of such payment.






	 	d.	 	If a Seller fails to pay, when due, any costs, expenses or other amounts
payable by it to any Person under this Agreement or the other Program Documents,
including, without limitation, reasonable fees and expenses of counsel and indemnities,
such amount may be paid to such Person, on behalf of such Seller, by Buyers in their
sole discretion, and, upon such payment, Buyers shall become subrogated to such
Person’s claim against such Seller and shall become immediately entitled to
reimbursement by such Seller for such payment.






	 	e.	 	Without prejudice to the survival of any other agreement of Sellers hereunder
or under the other Program Documents, the covenants and obligations of Sellers
contained in this Section and in Sections 13(j) and 15 shall constitute Obligations and
shall survive the payment in full (following the Termination Date) of the aggregate
amount of Repurchase Prices and all other amounts payable hereunder and assignment and
transfer of all Purchased Assets by Buyers to Sellers against full payment therefor.






	23.	 	WAIVER OF REDEMPTION AND DEFICIENCY RIGHTS





Each Seller hereby expressly waives, to the fullest extent permitted by law, every statute of
limitation on a deficiency judgment, any reduction in the proceeds of any Purchased Assets as a
result of restrictions upon Buyers, the Administrative Agent or Custodian contained in the Program
Documents or any other instrument delivered in connection therewith, and any right that it may have
to direct the order in which any of the Purchased Assets shall be disposed of in the event of any
disposition pursuant hereto.




	24.	 	REIMBURSEMENT





All sums reasonably expended by Buyers or the Administrative Agent in connection with the
exercise of any right or remedy provided for herein shall be and remain Sellers’ obligation. Each
Seller, jointly with the other Sellers and the Guarantor and severally, agrees to pay, with
interest at the Default Rate, to the extent that an Event of Default has occurred and is
continuing, the reasonable out-of-pocket expenses and reasonable attorneys’ fees incurred by
Buyers, the Administrative Agent and/or Custodian in connection with the preparation, enforcement
(including any waivers), administration and amendments of the Program Documents, the taking of any
action, including the Guarantor action, required or permitted to be taken by Buyers, the
Administrative Agent (without duplication to Buyers) and/or Custodian pursuant thereto, any “due
diligence” or loan agent reviews conducted by Buyers or the Administrative Agent or on their behalf
or by refinancing or restructuring in the nature of a “workout.” If any Buyer determines that, due
to the introduction of, any change in, or the compliance by such Buyer with (i) any eurocurrency
reserve requirement or (ii) the interpretation of any law, regulation or any guideline or request
from any central bank or other Governmental Authority (whether or not having the force of law),
there shall be an increase in the cost to such Buyer in engaging in the present or any future
Transactions, then each Seller agrees to pay to such Buyer, from time to time, upon demand by such
Buyer (with a copy to the Administrative Agent and Custodian) the actual cost of additional amounts
as specified by such Buyer to compensate such Buyer for such increased costs. Notwithstanding any
other provisions in this Agreement, in the event of any such change in the eurocurrency reserve
requirement or the interpretation of any law, regulation or any guideline or request from any
central bank or other Governmental Authority, Sellers will have the right to terminate all
Transactions then outstanding as of a date selected by Sellers (without the payment by Sellers of
any prepayment penalty or Breakage Costs), which date shall be prior to the applicable Repurchase
Date and which date shall thereafter for all purposes hereof, be deemed to be the Repurchase Date.
In addition, Buyers shall promptly notify Sellers if any events in clause (i) or (ii) of this
Section 24 occur.




	25.	 	FURTHER ASSURANCES





Sellers and Guarantor agree to do such further acts and things and to execute and deliver to
Buyers such additional assignments, acknowledgments, agreements, powers and instruments as are
reasonably required by Buyers to carry into effect the intent and purposes of this Agreement and
the other Program Documents, to perfect the ownership and security interests of Buyers and the
Administrative Agent in the Purchased Assets and the Collateral or to better assure and confirm
unto Buyers and the Administrative Agent their rights, powers and remedies hereunder and
thereunder.




	26.	 	ENTIRE AGREEMENT; PRODUCT OF NEGOTIATION





This Agreement supersedes and integrates all previous negotiations, contracts, agreements and
understandings between the parties relating to a sale and repurchase of Purchased Assets thereto,
and it, together with the other Program Documents, and the other documents delivered pursuant
hereto or thereto, contains the entire final agreement of the parties. No prior negotiation,
agreement, understanding or prior contract between or among the parties related to the subject
matter hereof, whether oral or written, shall have any validity.




	27.	 	TERMINATION






	 	a.	 	This Agreement, the Side Letter and the Program Documents shall remain in
effect until the earlier of (i) 364 days following the Effective Date or (ii) at
Buyers’ option upon the occurrence of an Event of Default (which option shall be deemed
to have been exercised immediately upon the occurrence of an Event of Default pursuant
to Section 18(f) or (g) hereof, such date, the “Termination Date” provided that
if such date is not a Business Day, the “Termination Date” shall be the
preceding Business Day). However, no such termination shall affect Sellers’
Outstanding Obligations to Buyers or the Administrative Agent at the time of such
termination. Sellers’ Obligations to indemnify Buyers, the Administrative Agent,
Custodian or any other Indemnified Person pursuant to this Agreement or any other
Program Document and Buyers’ and the Administrative Agent’s rights and remedies under
this Agreement and the other Program Documents shall survive the termination hereof.






	 	b.	 	At the request of Sellers made at least 45 days, but in no event earlier than
90 days, prior to the Termination Date then in effect, Buyers and Administrative Agent
may, in their sole discretion (and subject, always, to satisfactory negotiations
therefor and to Buyers’ obtaining the requisite credit committee and other approvals
therefor), enter with Sellers into a new Master Repurchase Agreement substantially in
the form of this Agreement with a tenor of no more than 364 days, whose effectiveness
shall be conditioned, among other things, on the effective termination of this
Agreement and the payment in full of all of Sellers’ Obligations hereunder. Within
sixty (60) days of receipt of such request from Sellers, Buyers may, in their sole
discretion, notify Sellers in writing whether or not Buyers are willing to enter into
such new Master Repurchase Agreement. Failure by Buyers (or any thereof) to so notify
Buyers within such 60-day period shall be deemed conclusively to indicate Buyers’
determination not to enter into such new Master Repurchase Agreement.






	28.	 	ASSIGNMENT





The Program Documents are not assignable by any Seller or the Guarantor. Each Buyer may from
time to time assign all or a portion of its rights and obligations under this Agreement and the
Program Documents; provided, however, that each Buyer shall maintain, for review by Sellers upon
written request, a register of assignees and a copy of an executed assignment and acceptance by
such Buyer and assignee (“Assignment and Acceptance”), specifying the percentage or portion
of such rights and obligations assigned, including upon the terms and conditions specified in
Section 17 hereof. Upon such assignment by any Buyer, (a) such assignee shall be a party hereto
and to each Program Document to the extent of the percentage or portion set forth in the Assignment
and Acceptance, and shall succeed to the applicable rights and obligations of such Buyer hereunder,
and (b) such Buyer shall, to the extent that such rights and obligations have been so assigned by
it to either (i) its Affiliates, another Buyer (including pursuant to Section 17(b) hereof) or an
Affiliate of any other Buyer which, in each case assumes the obligations of such Buyer or (ii) to
another Person approved by Sellers (such approval not to be unreasonably withheld and which
approval shall not, in any event, be required upon the occurrence and during the continuance of an
Event of Default) which assumes the obligations of such Buyer, be released from its obligations
hereunder occurring thereafter under the Program Documents. Unless otherwise stated in the
Assignment and Acceptance, Sellers shall continue to take directions solely from Buyers or the
Administrative Agent, as applicable, unless otherwise notified by Buyers or the Administrative
Agent, as applicable, in writing. Buyers may distribute to any prospective assignee any document
or other information delivered to Buyers (whether directly or through the Administrative Agent) by
Sellers. Notwithstanding any assignment by any Buyer pursuant to this Section 28 (other than in
accordance with clause (b) above), Buyers shall, in each case remain liable as to the Transactions
to which they are respective parties.




	29.	 	AMENDMENTS, ETC.





No amendment or waiver of any provision of this Agreement, the Side Letter or any other
Program Documents, nor any consent to any departure herefrom or therefrom by any of the parties
hereto or thereto, shall in any event be effective unless the same shall be in writing and signed
by each Seller whose Obligations would be modified by such amendment, waiver or consent, by the
Guarantor, and by Required Buyers, and then such amendment, waiver or consent shall be effective
only in the specific instance and for the specific purpose for which given; provided, however,




	 	(a)	 	no amendment, waiver or consent shall, unless in writing and
signed by all Buyers, to any of the following at any time:






	 	(i)	 	waive any of the conditions specified in
Section 9 hereof;






	 	(ii)	 	change (A) the number of Buyers, the Maximum
Aggregate Purchase Price, the Maximum Aggregate Senior Purchase Price,
or the Maximum Aggregate Subordinate Purchase Price, or (B) the number
of Transactions or sets of Related Transactions into which Buyers are
required to enter in any calendar day, [or at any given time];






	 	(iii)	 	release, or reduce the coverage of, the
Guaranty prior to the indefeasible payment in full (following the
Termination Date) of all of Sellers’ and the Guarantor’s Obligations;






	 	(iv)	 	except as otherwise specifically permitted
under this Agreement, release, prior to the Termination Date, (A) any
Purchased Assets from the possession or control of Buyers or the
Administrative Agent on their behalf under this Agreement or (B) any
Collateral from the Administrative Agent’s security interest under
Section 8 hereof; or






	 	(v)	 	amend, waive or consent to any departure from
any of Sections 3, 4, 7, 8 and 14, this Section 29, Sections 18 and 19
and Section 1(d) and Annex II or III; and






	 	(b)	 	no amendment, waiver or consent shall, unless in writing and
signed by the Required Buyers and each Buyer that is directly affected thereby,






	 	(i)	 	increase, decrease or redefine any Buyer’s
Purchased Interest; the Senior Purchased Interest Percentage or the
Subordinate Purchased Interest Percentage;






	 	(ii)	 	increase the Purchase Price or decrease the
Repurchase Price for any Purchased Assets, or decrease any Price
Differential, Pricing Rate, Buyer’s Margin Amount, Structuring Fee, or
any other payments to be made to Buyers or the Administrative Agent; or






	 	(iii)	 	postpone any Payment Date or Repurchase Date
or any payment to be made by Sellers to Buyers on any Payment Date or
Repurchase Date; and






	 	(c)	 	no amendment, waiver or consent shall, unless in writing and
signed by the Administrative Agent in addition to the Buyers or Required Buyers
required above to take such action, affect the rights or duties of the
Administrative Agent under this Agreement or the other Program Documents.





Anything in this Section 29 to the contrary notwithstanding, none of the defined terms set
forth in Section 1 hereof or elsewhere in this Agreement, the Side Letter or the other Program
Documents, shall be amended, supplemented or otherwise modified in any manner that would change the
meaning, purpose or effect of this Section 29 or any section, annex or provision referred to herein
unless such amendment, supplement or modification is agreed to in writing by the number and
percentage of Buyers or holders of Purchased Interests otherwise required to amend such section,
annex or provision under the terms of this Section 29.




	30.	 	SEVERABILITY





If any provision of any Program Document is declared invalid by any court of competent
jurisdiction, such invalidity shall not affect any other provision of the Program Documents, and
each Program Document shall be enforced to the fullest extent permitted by law.




	31.	 	BINDING EFFECT; GOVERNING LAW





This Agreement shall be binding and inure to the benefit of the parties hereto and their
respective successors and assigns, except that no Seller or Guarantor may assign or transfer any of
its rights or obligations under this Agreement or any other Program Document without the prior
written consent of Buyers, and it being understood that Buyers’ rights to assign their rights and
obligations hereunder shall be governed by Sections 17 and 28 hereof. THIS AGREEMENT SHALL BE
CONSTRUED IN ACCORDANCE WITH, AND GOVERNED BY, THE LAW OF THE STATE OF NEW YORK, WITHOUT GIVING
EFFECT TO THE CONFLICT OF LAWS PRINCIPLES THEREOF (EXCEPT FOR SECTIONS 5-1401 AND 5-1402 OF THE NEW
YORK GENERAL OBLIGATIONS LAW).




	32.	 	CONSENT TO JURISDICTION





EACH OF SELLERS, GUARANTOR, BUYERS AND THE ADMINISTRATIVE AGENT HEREBY WAIVES TRIAL BY JURY.
EACH SELLER AND GUARANTOR HEREBY IRREVOCABLY CONSENTS TO THE NON-EXCLUSIVE PERSONAL JURISDICTION OF
ANY COURT OF THE STATE OF NEW YORK, OR IN THE UNITED STATES DISTRICT COURT FOR THE SOUTHERN
DISTRICT OF NEW YORK, ARISING OUT OF OR RELATING TO THE PROGRAM DOCUMENTS IN ANY ACTION OR
PROCEEDING. EACH SELLER HEREBY SUBMITS TO, AND WAIVES ANY OBJECTION SELLER MAY HAVE TO,
NON-EXCLUSIVE PERSONAL JURISDICTION AND VENUE IN THE COURTS OF THE STATE OF NEW YORK AND THE UNITED
STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT OF NEW YORK, WITH RESPECT TO ANY DISPUTES ARISING
OUT OF OR RELATING TO THE PROGRAM DOCUMENTS.




	33.	 	SINGLE AGREEMENT





Sellers, Guarantor, Buyers and the Administrative Agent acknowledge that, and have entered
hereinto and will enter into each Transaction hereunder in consideration of and in reliance upon
the fact that, all Transactions hereunder constitute a single business and contractual relationship
and have been made in consideration of each other. Accordingly, each of Sellers, Guarantor, and
Buyers agrees (i) to perform all of its obligations in respect of each Transaction hereunder, and
that a default in the performance of any such obligations shall constitute a default by it in
respect of all Transactions hereunder, and (ii) that payments, deliveries and other assignments and
transfers made by any of them in respect of any Transaction shall be deemed to have been made in
consideration of payments, deliveries and other assignments and transfers in respect of any other
Transaction hereunder, and the obligations to make any such payments, deliveries and other
assignments and transfers may be applied against each other and netted.




	34.	 	INTENT





a. Sellers, Guarantor and Buyer recognize (i) that each of the Transactions and this Agreement
is a “repurchase agreement” as that term is defined in Section 101 of Title 11 of the United States
Code, as amended (“U.S.C.”), a “securities contract” as that term is defined in Section 741 of
Title 11 of the U.S.C., a “forward contract” as that term is defined in Section 101 of Title 11 of
the U.S.C. and a “master netting agreement” as that term is defined in Section 101 of Title 11 of
the U.S.C.; and (ii) that each assignment, transfer and/or payment to any Buyer, the Administrative
Agent or their designees of Purchased Assets, Additional Purchase Assets, Price Differential,
Repurchase Price, each related Collateral (including, without limitation, any such assignment,
transfer and/or payment pursuant to a Margin Call) is a Margin Payment and/or a Settlement Payment.



b. The Administrative Agent, Senior Buyer and Subordinate Buyer confirm to each other (in the
case of each Buyer, as to itself, as to the Administrative Agent, and as to its relationship with
the Administrative Agent; and, in the case of the Administrative Agent, as to itself, as to each
Buyer and as to its relationship with each Buyer) as follows: (i) each of the Administrative Agent
and Subordinate Buyer is a “financial institution”; (ii) each Buyer is the Administrative Agent’s
customer, for whom the Administrative Agent is acting as agent in connection with securities
contracts within the meaning of Section 101(22) of Title 11 of the U.S.C., and (iii) by virtue of
clauses (b)(i) and (b)(ii) above, Senior Buyer is also a “financial institution.”



c. It is understood that each Buyer’s and the Administrative Agent’s right to liquidate,
terminate and accelerate the Purchased Assets, or its Purchased Interests therein, assigned and
transferred to it in connection with any Transaction hereunder or to exercise any other remedies
pursuant to Section 19 hereof is a contractual right to liquidate, terminate and accelerate the
Transactions under a repurchase agreement, a securities contract, a forward contract and a master
netting agreement, as described in Sections 559, 555 and 561 of Title 11 of the U.S.C., and a
contractual right to offset under a master netting agreement and across contracts, as described in
Section 561 of Title 11 of the U.S.C.




	35.	 	NOTICES AND OTHER COMMUNICATIONS





Except as provided herein, any notice required or permitted by this Agreement shall be in
writing and shall be effective and deemed delivered only when received by the party to which it is
sent; provided, however, that a facsimile transmission shall be deemed to be received when
transmitted so long as the transmitting machine has provided an electronic confirmation (without
error message) of such transmission. Any such notice shall be sent to a party at the address or
facsimile transmission number set forth below:



if to the Guarantor:



New Century Financial Corporation


18400 Van Karman, Suite 1000


Irvine, California 92612


Attention: Kevin Dwyer, Esq.


Telephone: (949) 225-7808


Facsimile: (949) 440-7033



with a copy to:



New Century Capital Corporation


18400 Van Karman, Suite 1000


Irvine, California 92612


Attention: Kevin Dwyer, Esq.


Telephone: (949) 225-7808


Facsimile: (949) 440-7033



if to NCCC:



New Century Capital Corporation


18400 Van Karman, Suite 1000


Irvine, California 92612


Attention: Kevin Cloyd


Telephone: (949) 862-7941


Facsimile: (949) 440-7033



if to NCMC (as Seller or as Servicer):



New Century Mortgage Corporation


18400 Van Karman, Suite 1000


Irvine, California 92612


Attention: Ralph Flick, Esq.


Telephone: (949) 863-7243


Facsimile: (949) 440-7033



with a copy to:



New Century Capital Corporation


18400 Van Karman, Suite 1000


Irvine, California 92612


Attention: Kevin Dwyer, Esq.


Telephone: (949) 225-7808


Facsimile: (949) 440-7033



if to NCAH:



NC Asset Holding L.P.


18400 Van Karman, Suite 1000


Irvine, California 92612


Attention: Kevin Cloyd


Telephone: (949) 862-7941


Facsimile: (949) 440-7033



with a copy to:



New Century Capital Corporation


18400 Van Karman, Suite 1000


Irvine, California 92612


Attention: Kevin Dwyer, Esq.


Telephone: (949) 225-7808


Facsimile: (949) 440-7033



If to Home123:



Home123 Corporation


18400 Van Karman, Suite 1000


Irvine, California 92612


Attention: Kevin Cloyd


Telephone: (949) 862-7941


Facsimile: (949) 440-7033



with a copy to:



New Century Capital Corporation


18400 Van Karman, Suite 1000


Irvine, California 92612


Attention: Kevin Dwyer, Esq.


Telephone: (949) 225-7808


Facsimile: (949) 440-7033



if to NCC:



New Century Credit Corporation


18400 Van Karman, Suite 1000


Irvine, California 92612


Attention: Kevin Cloyd


Telephone: (949) 862-7941


Facsimile: (949) 440-7033



with a copy to:



New Century Capital Corporation


18400 Van Karman, Suite 1000


Irvine, California 92612


Attention: Kevin Dwyer, Esq.


Telephone: (949) 225-7808


Facsimile: (949) 440-7033



if to any Buyer, the Administrative Agent or the Buying Agent:



	 
	Barclays Capital Services
200 Cedar Knolls Road
Whippany, NJ 07981
Attn:Glenn Pearson
Hansel Nieves
Shelby Robins
Email:glenn.pearson@barcap.com
hansel.nieves@barcap.com
asgoperations@barcap.com

	with a copy to:







	 	 	 	 	 
	Barclays Capital Inc.
200 Park Avenue
New York, NY 10166
	 	 	 	 
	Facsimile: (212) 412-6846

	Attn:
	 	Joseph P. O’Doherty

	 
	 	Glen Greeley

	 
	 	Harry Ahlin

	Email:
	 	joseph.o’doherty@barcap.com

	 
	 	glen.greeley@barcap.com

	 
	 	harry.ahlin@barcap.com







and



	 	 	 	 	 
	Barclays Bank PLC
	 	 	 	 
	c/o Asset Securitization Group

	200 Park Avenue
New York, NY 10166
Facsimile: (212) 412-6846
Attn:
	 	Mary Logan

	 
	 	Janette Lieu

	Email:
	 	mary.logan@barcap.com

	 
	 	janette.lieu@barcap.com







as such address or number may be changed by like notice.




	36.	 	CONFIDENTIALITY





This Agreement and its terms, provisions, supplements and amendments, and transactions and
notices hereunder, are proprietary to Buyers, Administrative Agent and Buying Agent and shall be
held by NCCC, NCMC, Home123, NCAH, NCC and the Guarantor (and Sellers and Guarantor shall cause
Servicer to hold it) in strict confidence and shall not be disclosed to any third party without the
consent of Buyers, except for (i) disclosure to NCCC’s, NCMC’s, Home123’s, NCAH’s, NCC’s or the
Guarantor’s direct and indirect parent companies, attorneys, agents or accountants, provided that
such attorneys or accountants likewise agree to be bound by this covenant of confidentiality or
otherwise is subject to confidentiality restrictions or (ii) disclosure required by law, rule,
regulation or order of a court or other regulatory body or (iii) disclosure to any approved Hedge
Counterparty to the extent necessary to obtain any Hedge Instrument hereunder or (iv) any
disclosures or filing required under Securities and Exchange Commission or state securities’ laws;
provided that NCCC, NCMC, Home123, NCAH, NCC and the Guarantor agree to use best efforts not to
file the terms of the Side Letter with any such filing; provided, that in the case of (ii), (iii)
and (iv), NCCC, NCMC, Home123, NCAH, NCC, and NCFC shall take reasonable actions to provide Buyers
with prior written notice. Notwithstanding anything herein to the contrary, except as reasonably
necessary to comply with applicable securities laws, each party (and each employee, representative,
or other agent of each party) may disclose to any and all persons, without limitation of any kind,
the tax treatment and tax structure of the transaction and all materials of any kind (including
opinions of other tax analyses) that are provided to it relating to such tax treatment and tax
structure. For this purpose, tax treatment and tax structure shall not include (i) the identity of
any existing or future party (or any Affiliate of such party) to this Agreement or (ii) any
specific pricing information or other commercial terms, including the amount of any fees, expenses,
rates or payments arising in connection with the transactions contemplated by this Agreement.




	37.	 	MAXIMUM AGGREGATE PURCHASE PRICE; MAXIMUM AGGREGATE SENIOR PURCHASE PRICE; AND MAXIMUM
AGGREGATE SUBORDINATE PURCHASE PRICE





The maximum aggregate Purchase Price paid or payable by Buyers for Purchased Assets in all
Transactions at any time outstanding hereunder for which Buyers shall not have been repaid the
Repurchase Price and all other related amounts in full (the “Outstanding Transactions”)
shall equal $1,000,000,000 (the “Maximum Aggregate Purchase Price”). The maximum aggregate
Purchase Price paid or payable by Senior Buyer at any time for all Senior Purchased Interests in
the Purchased Assets in all Outstanding Transactions shall equal $900,000,000 (the “Maximum
Aggregate Senior Purchase Price”). The maximum aggregate Purchase Price (the “Maximum
Aggregate Subordinate Purchase Price”) paid or payable by Subordinate Buyer at any time for all
Subordinate Purchased Interests in the Purchased Assets in all Outstanding Transactions shall be,
at any time, an amount (the “Maximum Aggregate Subordinate Purchase Price”) equal to the
excess of (i) the Maximum Aggregate Purchase Price over (ii) the aggregate Purchase Price paid or
payable by Senior Buyer for all Senior Purchased Interests in the Purchased Assets in all
Outstanding Transactions at such time.




	38.	 	POWER OF ATTORNEY





The Guarantor and each Seller hereby authorizes Buyers and the Administrative Agent on its own
behalf and on Buyers’ behalf, to file such financing statement or statements relating to the
Purchased Assets without their respective signatures thereon as Buyer, at its option, may deem
appropriate. Each of the Guarantor and the Sellers hereby appoints the Administrative Agent as its
agent and attorney-in-fact to execute any such financing statement or statements in its name and to
perform all other acts which the Administrative Agent (as instructed by Buyers) deems appropriate
to perfect and continue its ownership interest in and/or the security interest granted hereby, if
applicable, and to protect, preserve and realize upon the Purchased Assets, including, but not
limited to, the right to endorse notes, complete blanks in documents, transfer servicing, and sign
assignments on behalf of the Guarantor or a Seller, as applicable, as its agent and
attorney-in-fact. This agency and power of attorney is coupled with an interest and is irrevocable
without the Administrative Agent’s consent. Notwithstanding the foregoing, the power of attorney
hereby granted may be exercised only during the occurrence and continuance of any Event of Default
hereunder. Guarantor or Sellers shall pay the filing costs for any financing statement or
statements prepared pursuant to this Section 38.




	39.	 	DUE DILIGENCE





Each Seller and Guarantor agrees to cooperate with Buyers, the Administrative Agent and their
agents in connection with access to any and all documents, records, agreements, instruments or
information relating to the Purchased Assets in the possession, or under the control, of a Seller
or the Guarantor or any of their respective agents. In addition, Buyers and the Administrative
Agent have the right to perform continuing due diligence reviews of any Seller and the Guarantor
and their respective Affiliates, directors, officers, employees, significant shareholders and
agents.




	40.	 	SETOFF





In addition to any rights and remedies of Buyers and the Administrative Agent provided by law,
Buyers shall have the right, without prior notice to any Seller, any such notice being expressly
waived by such Seller to the extent permitted by applicable law, upon any amount becoming due and
payable by such Seller hereunder (whether at the stated maturity, by acceleration or otherwise) to
set off and appropriate and apply against such amount any and all deposits (general or special,
time or demand, provisional or final), in any currency, and any other credits, indebtedness or
claims, in any currency, in each case whether direct or indirect, absolute or contingent, matured
or unmatured, at any time held or owing by Buyers or any branch or agency thereof to or for the
credit or the account of such Seller. Buyers agree promptly to notify such Seller after any such
setoff and application made by Buyers; provided, that the failure to give such notice shall not
affect the validity of such setoff and application.




	41.	 	NO PROCEEDINGS. EACH OF SELLERS, THE SERVICER, THE GUARANTOR, AND BUYERS HEREBY AGREES THAT
IT WILL NOT INSTITUTE AGAINST, OR JOIN ANY OTHER PERSON IN INSTITUTING AGAINST, ANY BUYER OR
THE ADMINISTRATIVE AGENT, ANY PROCEEDINGS OF THE TYPES REFERRED TO IN THE DEFINITION OF
“INSOLVENCY EVENT” BELOW UNTIL ONE YEAR AND ONE DAY SHALL HAVE ELAPSED SINCE THE LATER OF (I)
THE DAY (FOLLOWING THE TERMINATION DATE) ON WHICH ALL OBLIGATIONS OF SELLERS AND THE GUARANTOR
UNDER THIS AGREEMENT, THE SIDE LETTER, THE GUARANTY AND ALL OTHER PROGRAM DOCUMENTS SHALL HAVE
BEEN PAID IN FULL AND (II) THE LAST DAY ON WHICH ANY COMMERCIAL PAPER ISSUED FROM TIME TO TIME
BY ANY BUYER REMAINS OUTSTANDING.






AS USED HEREIN, “INSOLVENCY EVENT’ MEANS, FOR ANY BUYER OR THE ADMINISTRATIVE AGENT:




	 	(i)	 	THAT SUCH PERSON OR ANY AFFILIATE SHALL
DISCONTINUE OR ABANDON OPERATION OF ITS BUSINESS; OR






	 	(ii)	 	THAT SUCH PERSON OR ANY AFFILIATE SHALL FAIL
GENERALLY TO, OR ADMIT IN WRITING ITS INABILITY TO, PAY ITS DEBTS AS
THEY BECOME DUE; OR






	 	(iii)	 	A PROCEEDING HAS BEEN INSTITUTED IN A COURT
HAVING JURISDICTION SEEKING A DECREE OR ORDER FOR RELIEF IN RESPECT OF
SUCH PERSON OR ANY AFFILIATE IN AN INVOLUNTARY CASE UNDER ANY
APPLICABLE BANKRUPTCY, INSOLVENCY, LIQUIDATION, REORGANIZATION OR OTHER
SIMILAR LAW NOW OR HEREAFTER IN EFFECT, OR FOR THE APPOINTMENT OF A
RECEIVER, LIQUIDATOR, ASSIGNEE, TRUSTEE, CUSTODIAN, SEQUESTRATOR,
CONSERVATOR OR OTHER SIMILAR OFFICIAL OF SUCH PERSON OR ANY AFFILIATE,
OR FOR ANY SUBSTANTIAL PART OF ITS PROPERTY, OR FOR THE WINDING-UP OR
LIQUIDATION OF ITS AFFAIRS, AND THE CONTINUATION OF SUCH PROCEEDINGS
UNSTAYED FOR A PERIOD OF 30 DAYS; OR






	 	(iv)	 	THE COMMENCEMENT BY SUCH PERSON OR ANY
AFFILIATE OF A VOLUNTARY CASE UNDER ANY APPLICABLE BANKRUPTCY,
INSOLVENCY OR OTHER SIMILAR LAW NOW OR HEREAFTER IN EFFECT, OR SUCH
PERSON’S OR ANY AFFILIATE’S CONSENT TO THE ENTRY OF AN ORDER FOR RELIEF
IN AN INVOLUNTARY CASE UNDER ANY SUCH LAW, OR CONSENT TO THE
APPOINTMENT OF OR TAKING POSSESSION BY A RECEIVER, LIQUIDATOR,
ASSIGNEE, TRUSTEE, CUSTODIAN, SEQUESTRATOR, CONSERVATOR OR OTHER
SIMILAR OFFICIAL OF SUCH PERSON, OR FOR ANY SUBSTANTIAL PART OF ITS
PROPERTY, OR ANY GENERAL ASSIGNMENT FOR THE BENEFIT OF CREDITORS; OR






	 	(v)	 	THAT SUCH PERSON OR ANY AFFILIATE SHALL BECOME
INSOLVENT; OR






	 	(vi)	 	IF SUCH PERSON OR ANY AFFILIATE IS A
CORPORATION, SUCH PERSON OR ANY AFFILIATE, OR ANY OF THEIR
SUBSIDIARIES, SHALL TAKE ANY CORPORATE ACTION IN FURTHERANCE OF, OR THE
ACTION OF WHICH WOULD RESULT IN ANY OF THE ACTIONS SET FORTH IN ANY OF
PRECEDING CLAUSES (I), (II), (III), (IV) AND (V).





[Signature Page Follows]




1




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



NC CAPITAL CORPORATION, as Seller



By: /s/ Kevin Cloyd

Name: Kevin Cloyd

Title: President





NEW CENTURY MORTGAGE CORPORATION, as Seller



By: /s/ Kevin Cloyd

Name: Kevin Cloyd

Title: Executive Vice President





NC ASSET HOLDING, L.P., as Seller



By: NC Deltex, LLC


Its General Partner



By: /s/ Kevin Cloyd


Name: Kevin Cloyd

Title: Executive Vice President



HOME123 CORPORATION



By: /s/ Kevin Cloyd

Name: Kevin Cloyd

Title: Executive Vice President





NEW CENTURY CREDIT CORPORATION, as Seller



By: /s/ Kevin Cloyd

Name: Kevin Cloyd

Title: President





BARCLAYS BANK PLC, as Subordinate Buyer, Buying Agent and Administrative Agent



By: /s/ Joseph O’Doherty

Name: Joseph O’Doherty

Title: Director





SHEFFIELD RECEIVABLES CORPORATION, as Senior Buyer



By: Barclays Bank PLC,





Its Administrative Agent



By: /s/ Janette Lieu


Name: Janette Lieu

Title: Director



2



Acknowledged and Agreed:



NEW CENTURY FINANCIAL CORPORATION,





as Guarantor



By: /s/ Kevin Cloyd

Name: Kevin Cloyd

Title: Executive Vice President





By: /s/ Edward F. Gotschall

Name: Edward F. Gotschall

Title: Vice Chairman — Finance



Acknowledged and Agreed with respect to


Sections 6, 7, 8, 13(d), 13(g), 19 and 41, and Annexes II and III:



NEW CENTURY MORTGAGE CORPORATION,





as Servicer



By: /s/ Kevin Cloyd

Name: Kevin Cloyd

Title: Executive Vice President




3