Second Amended and Restated Master Repurchase Agreement



 Exhibit 10.1 
 EXECUTION 
 WAIVER AND THIRD AMENDMENT TO 
 SECOND AMENDED AND RESTATED MASTER REPURCHASE AGREEMENT 
 GOVERNING PURCHASES
AND SALES OF MORTGAGE LOANS 
 This Waiver and Third Amendment, dated as of December 19, 2006 (this “Amendment”),
to the Second Amended and Restated Master Repurchase Agreement Governing Purchases and Sales of Mortgage Loans, dated as of December 29, 2004 and amended as of December 28, 2005 and further amended as of October 31, 2006 (as amended,
the “Repurchase Agreement”), is made by and among LEHMAN BROTHERS BANK, FSB (“Buyer”), FIELDSTONE INVESTMENT CORPORATION (“FIC”) and FIELDSTONE MORTGAGE COMPANY (“FMC”) (FIC and FMC
shall be individually and collectively referred to as “Seller”). Buyer, FMC and FIC may be collectively referred to herein as the “Parties”. 
 RECITALS 
 WHEREAS, pursuant to the Repurchase Agreement, Buyer has
agreed, subject to the terms and conditions set forth in the Repurchase Agreement, to purchase certain Mortgage Loans owned by Seller, including, without limitation, all rights of Seller to service and administer such Mortgage Loans; 
 WHEREAS, Buyer has agreed to waive compliance with the “Profitability” financial covenant for the fourth quarter of Seller’s fiscal year
ending December 31, 2006; and 
 WHEREAS, the Parties desire to amend the Repurchase Agreement as set forth herein. 
 NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties hereto agree as follows:

 Section 1. Definitions. Capitalized terms used but not otherwise defined herein have the meanings given them in the Repurchase
Agreement. 
 Section 2. Amendments to Repurchase Agreement. Subject to Section 4 hereof, the Repurchase Agreement shall be
amended as follows: 
 (a) References in the Repurchase Agreement to “this Agreement” or words of similar import (including indirect
references to the Repurchase Agreement) shall, without limitation, be deemed to be references to the Repurchase Agreement as amended by this Amendment. 
 (b) Section 12(m) is hereby amended by deleting the “Profitability” financial covenant therein in its entirety and replacing it with the following: 








			
	Profitability	  	During the term of this Agreement, Seller shall not (i) during any fiscal quarter ending on or prior to September 30, 2006, have Net Income of less than $1.00 in any two consecutive
fiscal quarters without regard to unrealized gains or losses from Hedges during such period, (ii) for the fiscal quarter ending on December 31, 2006, have Net Income of less than negative $47,000,000 (i.e., a loss of more than $47,000,000)
without regard to unrealized gains or losses from Hedges during such period and (iii) from and after the fiscal quarter ending March 31, 2007, have Net Income of less than $1.00 in any two consecutive fiscal quarters without regard to
unrealized gains or losses from Hedges during such period; provided, that, Seller shall notify Buyer of any such unrealized gains or losses via the related compliance certificate.

 Section 3. Representations and Warranties. Seller hereby represents and warrants to Buyer
that (a) both immediately before and after giving effect to the amendments set forth in Section 2 of this Amendment, no Event of Default shall have occurred and be continuing, (b) the representations and warranties of Seller set forth
in Section 10 of the Repurchase Agreement are true and complete as if made on and as of such date and as if each reference in said Section 10 to “this Agreement” included reference to the Repurchase Agreement as amended hereby,
(c) this Amendment constitutes the legal, valid and binding obligation of Seller, enforceable against Seller in accordance with its terms and (d) the execution and delivery by Seller of this Amendment has been duly authorized by all
requisite corporate action on the part of Seller and will not violate any provision of Seller’s organizational documents. 
 Section 4.
Conditions Precedent. The amendments set forth in Section 2 above shall not become effective unless, on or before December 19, 2006, Buyer shall have received all of the following documents, each of which shall be satisfactory in
form and substance to Buyer and its counsel: 
 (a) Amendment. This Amendment, duly completed, executed and delivered by Seller;

 (b) Other Documents. Such other documents as Buyer may reasonably request. 
 Section 5. Miscellaneous. 
 (a) Except
as expressly amended by Section 2 hereof, the Repurchase Agreement remains unaltered and in full force and effect. Each of the Parties hereby reaffirms all terms and covenants made in the Repurchase Agreement as amended hereby. 
 (b) The execution, delivery and effectiveness of this Amendment shall not operate as a waiver of any right, power or remedy of any Party under the
Repurchase Agreement, or any other document, instrument or agreement executed and/or delivered in connection therewith. 
 (c) THIS AMENDMENT
SHALL BE CONSTRUED, INTERPRETED AND GOVERNED BY THE LAW OF THE STATE OF NEW YORK, WITHOUT GIVING EFFECT TO THE CONFLICT OF LAWS PRINCIPLES THEREOF. 
 (d) This Amendment may be executed in any number of counterparts, and all such counterparts shall together constitute the same agreement. Any signature delivered by a party via facsimile shall be deemed to be an original signature hereto.

 [SIGNATURE PAGE TO FOLLOW] 
  

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

			
	SELLER:
	
	FIELDSTONE MORTGAGE COMPANY
		
	By:	 	/s/ Mark C. Krebs
	Name:	 	Mark C. Krebs
	Title:	 	Senior Vice President and Treasurer
	
	FIELDSTONE INVESTMENT CORPORATION
		
	By:	 	/s/ Mark C. Krebs
	Name:	 	Mark C. Krebs
	Title:	 	Senior Vice President and Treasurer
	
	BUYER:
	
	LEHMAN BROTHERS BANK, FSB
		
	By:	 	/s/ Fred C. Madomma
	Name:	 	Fred C. Madomma
	Title:	 	Authorized Signature


 Waiver and Third Amendment to 
 Second Amended and Restated Master Repo 
  

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