Amendment No. 1 to Third Amended and Restated Master Loan and Security Agreement


 Exhibit 10.3 
  
 AMENDMENT NO. 1 
  
 AMENDMENT NO. 1, dated as of January 28, 2005 (this “Amendment”), to that certain Third Amended and Restated Master Loan and Security
Agreement, dated as of October 1, 2004 (as amended, supplemented or otherwise modified prior to the date hereof, the “Existing Loan Agreement”, as modified hereby and as further amended, restated, supplemented or otherwise modified
and in effect from time to time, the “Loan Agreement”), by and among NC CAPITAL CORPORATION (“NC Capital”), NEW CENTURY MORTGAGE CORPORATION (“New Century”), NC RESIDUAL II CORPORATION
(“NCRII”), NEW CENTURY CREDIT CORPORATION (“NC Credit”, together with NC Capital, New Century and NCRII, the “Borrowers”, each a “Borrower”), MORGAN STANLEY BANK
(“MSB”) and MORGAN STANLEY MORTGAGE CAPITAL INC. (“MSMCI”) (MSMCI, in its capacity as a lender, together with MSB, collectively, the “Lenders”, and in its capacity as agent for the Lenders, together
with any successors and assigns, the “Agent”). Capitalized terms used but not otherwise defined herein shall have the meanings given to them in the Loan Agreement. 
  
 RECITALS 
  
 The Borrowers, the Lenders and the Agent are parties to the Existing Loan Agreement, pursuant to which the Lenders have agreed to make and to permit to
remain outstanding certain extensions of credit on the terms and subject to the conditions of the Existing Loan Agreement. 
  
 The Borrowers, the Lenders and the Agent have agreed, subject to the terms and conditions hereof, that the Existing Loan Agreement shall be amended to
extend the termination date and revise the definitions of Applicable Collateral Percentage and Applicable Margin. 
  
 The parties hereto hereby agree, in consideration of the mutual premises and mutual obligations set forth herein, as follows: 
  
 SECTION 1. Amendments. 
  
 (a) The Existing Loan Agreement is hereby amended by deleting the definition
of “Applicable Collateral Percentage” set forth in Section 1.01 of the Existing Loan Agreement in its entirety and inserting in lieu thereof the following: 
  
 “Applicable Collateral Percentage” shall mean, except as may be reduced pursuant to Section 11.15 hereof,
for any date of determination and each type of Eligible Mortgage Loan, the applicable collateral percentage specified in the table below: 
  

			
	 Type of Eligible Mortgage Loan

	 	 Applicable Collateral Percentage


	 Unseasoned Mortgage Loan
	 	98%
	 Second Lien Mortgage Loan
	 	98%
	 30+ Delinquent Mortgage Loan
	 	85%
	 60+ Delinquent Mortgage Loan
	 	75%
	 Wet-Ink Mortgage Loan
	 	98%
	 Defaulted Mortgage Loan
	 	the applicable BPO Percentage
	 Discretionary Mortgage Loan
	 	the applicable percentage specified by the Agent one (1) Business Day prior to the applicable Funding Date”

  
  






 (b) The Existing Loan Agreement is hereby amended by deleting the definition of “Applicable
Margin” set forth in Section 1.01 of the Existing Loan Agreement in its entirety and inserting in lieu thereof the following: 
  
 “Applicable Margin” shall mean the sum of the weighted average of the applicable rates per annum for each type of Eligible Mortgage Loan
for each day that Loans shall be secured by such Eligible Mortgage Loans. For each type of Eligible Mortgage Loan, the applicable rate shall be equal to the product of (x) a fraction equal to (1) the Collateral Value of all Eligible Mortgage Loans
of such type, divided by (2) the Collateral Value of all Eligible Mortgage Loans, and (y) the applicable margin specified in the table below: 
  

			
	 Type of Eligible Mortgage Loan

	 	 Applicable Margin


	 Unseasoned Mortgage Loan
	 	0.50%
	 Second Lien Mortgage Loan
	 	0.50%
	 30+ Delinquent Mortgage Loan
	 	1.00%
	 60+ Delinquent Mortgage Loan
	 	1.00%
	 Defaulted Mortgage Loan
	 	1.45%
	 Wet-Ink Mortgage Loan
	 	0.50%
	 Discretionary Mortgage Loan
	 	the applicable percentage specified by the Agent one (1) Business Day prior to the applicable Funding Date”

  
 (c) The Existing Loan
Agreement is hereby amended by deleting the definition of “Termination Date” set forth in Section 1.01 of the Existing Loan Agreement in its entirety and inserting in lieu thereof the following: 
  
 “Termination Date” shall mean February 28, 2005, as such
date may be extended in accordance with Section 2.08 hereof, or such earlier date on which this Loan Agreement shall terminate in accordance with the provisions hereof or by operation of law. 
  

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 SECTION 2. Conditions Precedent. This Amendment shall become effective on the first date
(the “Effective Date”) on which all of the following conditions precedent shall have been satisfied: 
  
 2.1 Delivered Documents. On the Effective Date, the Agent shall have received the following documents, each of which shall be satisfactory to the
Agent in form and substance: 
  
 (a) Amendment. This
Amendment, executed and delivered by a duly authorized officer of each of the Borrowers, the Lenders and the Agent; and 
  
 (b) Other Documents. Such other documents as the Agent or counsel to the Agent may reasonably request. 
  
 2.2 No Default. On the Effective Date, (i) each Borrower shall be in
compliance in all material respects with all of the terms and provisions set forth in the Loan Agreement and the other Loan Documents on its part to be observed or performed, (ii) the representations and warranties made and restated by such Borrower
pursuant to Section 3 of this Amendment shall be true and complete in all material respects on and as of such date with the same force and effect as if made on and as of such date and (iii) no Default shall have occurred and be continuing on such
date. 
  
 SECTION 3. Representations and Warranties.
Each Borrower hereby represents and warrants to the Agent, as of the date hereof and as of the Effective Date, that it is in compliance in all material respects with all of the terms and provisions set forth in the Loan Documents on its part to be
observed or performed and that no Default has occurred or is continuing, and each Borrower hereby confirms and reaffirms in all material respects the representations and warranties contained in Section 6 of the Loan Agreement. 
  
 SECTION 4. Limited Effect. Except as expressly modified hereby,
the Existing Loan Agreement shall continue to be, and shall remain, in full force and effect in accordance with its terms; provided, however, that upon the Effective Date each reference therein to the “Loan Agreement” shall
be deemed to mean the Loan Agreement as defined in this Amendment, each reference in this Amendment to the “Loan Documents” shall be deemed to include, in any event, this Amendment and each reference to the Loan Agreement in any of the
Loan Documents shall be deemed to be a reference to the Loan Agreement as modified hereby. 
  
 SECTION 5. Counterparts. This Amendment may be executed by each of the parties hereto on any number of separate counterparts, each of which shall be an original and all of which taken together shall
constitute one and the same instrument. Delivery of an executed counterpart signature page to this Amendment in Portable Document Format (PDF) or by facsimile transmission shall be as effective as delivery of a manually executed original counterpart
thereof. 
  

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 SECTION 6. GOVERNING LAW. THIS AMENDMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE
WITH, THE LAWS OF THE STATE OF NEW YORK. 
  
 [SIGNATURES FOLLOW]

  
  

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 IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be duly executed and delivered as of
the day and year first above written. 
  

			
	 BORROWERS

	
	NC CAPITAL CORPORATION
		
	 By:
	 	 /s/ Kevin Cloyd


	 Name:
	 	Kevin Cloyd
	 Title:
	 	President
	
	 NEW CENTURY MORTGAGE
     CORPORATION

		
	 By:
	 	 /s/ Kevin Cloyd


	 Name:
	 	Kevin Cloyd
	 Title:
	 	Executive Vice President
	
	NC RESIDUAL II CORPORATION
		
	 By:
	 	 /s/ Kevin Cloyd


	 Name:
	 	Kevin Cloyd
	 Title:
	 	Executive Vice President
	
	NEW CENTURY CREDIT CORPORATION
		
	 By:
	 	 /s/ Kevin Cloyd


	 Name:
	 	Kevin Cloyd
	 Title:
	 	Executive Vice President









			
	 MORGAN STANLEY MORTGAGE 
      CAPITAL INC., as Agent and as a Lender

		
	 By:
	 	 /s/ Paul J. Najarian


	 Name:
	 	Paul J. Najarian
	 Title:
	 	Vice President
	
	MORGAN STANLEY BANK, as a Lender
		
	 By:
	 	 /s/ Paul J. Najarian


	 Name:
	 	Paul J. Najarian
	 Title:
	 	Vice President