EX-10.1






AMENDMENT NUMBER TWO

to the

MASTER REPURCHASE AGREEMENT

and

PRICING SIDE LETTER,

each dated as of May 16, 2005

among

DB STRUCTURED PRODUCTS, INC.,

ASPEN FUNDING CORP.,

NEWPORT FUNDING CORP.,

ECC CAPITAL CORPORATION,

ENCORE CREDIT CORP.,

BRAVO CREDIT CORPORATION,

ECC SPV II,

ENCORE SPV II

and

BRAVO SPV II




This AMENDMENT NUMBER TWO TO MASTER REPURCHASE AGREEMENT AND PRICING SIDE LETTER (this
“Amendment”), is made and is effective as of this 28th day of February, 2006 (the
“Amendment Number Two Effective Date”), among DB Structured Products, Inc. (“DBSP”), Aspen Funding
Corp. (“Aspen”), Newport Funding Corp. (“Newport” and collectively with DBSP and Aspen, the
“Buyers”), ECC Capital Corporation (“ECC”), Encore Credit Corp. (“Encore”), Bravo Credit
Corporation (“Bravo” and collectively with ECC and Encore, the “Guarantors”), ECC SPV II (“ECC
SPV”), Encore SPV II (“Encore SPV”) and Bravo SPV II (“Bravo SPV” and collectively with ECC SPV and
Encore SPV, the “Sellers”).



R E C I T A L S




Guarantors, Sellers and Buyers entered into that certain Master Repurchase Agreement dated as
of May 16, 2005 (as amended, supplemented and otherwise modified from time to time, the
“Repurchase Agreement”) and pricing side letter dated as of May 16, 2005 (the “Pricing
Side Letter”).



Guarantors, Buyers and Sellers entered into that certain Amendment Number One to the
Repurchase Agreement and Pricing Side Letter dated August 18, 2005.



Guarantors, Buyers and Sellers each desire to further modify certain terms of the Repurchase
Agreement and Pricing Side Letter as set forth in this Amendment.



Guarantors, Buyers and Sellers each have agreed to execute and deliver this Amendment on the
terms and conditions set forth herein.



NOW, THEREFORE, in consideration of the premises and the mutual covenants contained herein and
in the Repurchase Agreement and Pricing Side Letter, the receipt and sufficiency of which are
hereby acknowledged, the parties hereto agree to the following (all capitalized terms used, but not
defined, herein shall have the meanings ascribed to such terms in the Repurchase Agreement or
Pricing Side Letter, as applicable):



1. Amendments. Upon the execution of this Amendment by each party hereto and
effective as of the Amendment Number Two Effective Date:




	 	(a)	 	With respect to the Repurchase Agreement:






	 	(i)	 	Section 2 (Definitions and Interpretations) of the Repurchase
Agreement is hereby amended by adding the following new definition immediately
following the definition of “First Lien Loan”:





“Forty Year Mortgage Loan” means a Loan with a forty year
amortization period but which becomes due and payable in full at the end of
the thirtieth year.”




	 	(ii)	 	Section (t) of Exhibit B to the Agreement is hereby amended by
deleting Section (t) in it’s entirety and replacing it with the following:






“(t) Origination; Payment Terms. At the time the Loan was originated,
the originator was a mortgagee approved by the Secretary of Housing and Urban
Development pursuant to Sections 203 and 211 of the National Housing Act or a
savings and loan association, a savings bank, a commercial bank or similar banking
institution which is supervised and examined by a Federal or State authority. No
Loan contains terms or provisions which would result in negative amortization.
Except for Interest Only Loans, principal payments on the Loan commenced no more
than sixty (60) days after funds were disbursed in connection with the Loan. The
Mortgage Interest Rate is adjusted, with respect to adjustable rate Loans, on each
Adjustment Date to equal the applicable Index plus the Gross Margin (rounded up or
down to the nearest 0.125%), subject to the Maximum Mortgage Interest Rate. The
Note is payable on the first day of each month in equal monthly installments of
principal and interest (except for Interest Only Loans during the interest only
period and for Forty Year Mortgage Loans), which, with respect to a fixed rate
Mortgage Loan, are sufficient to fully amortize the original principal balance over
the original term thereof and to pay interest at the related Mortgage Interest Rate,
and which installments of interest, with respect to an Adjustable Rate Mortgage
Loan, are subject to change due to the adjustments to the Mortgage Interest Rate on
each Adjustment Date, with interest calculated and payable in arrears, sufficient to
amortize the Loan fully by the stated maturity date, over an original term of not
more than thirty (30) years (except for Forty Year Mortgage Loans) from commencement
of amortization. The Due Date of the first payment under the Note is no more than
sixty (60) days from the date of the Note.”




	 	(iii)	 	Section (nnn) of Exhibit B to the Agreement is hereby by
deleting Section (nnn) in its entirety and replacing it with the following:





“(nnn) Balloon Loans. Except for certain Second Lien Mortgage
Loans and Forty Year Mortgage Loans originated by Originators, no Loan is a
Balloon Loan.”



(b) With respect to the Pricing Side Letter:




	 	(i)	 	Section (x)(l) of the definition of Eligible Loan shall be
deleted in its entirety and replaced with the following language:






“(l) 40% of the Maximum Aggregate Purchase Price, with respect to the aggregate amount
of Purchased Loans that are Interest-Only Loans and Forty Year Mortgage Loans.”



2. Representations and Warranties. Each of the Sellers and Guarantors hereby
represents and warrants that (a) it has the power and is duly authorized to execute and deliver
this Amendment, (b) this Amendment has been duly authorized, executed and delivered, (c) it is and
will continue to be duly authorized to perform its obligations under the Program Documents, (d) the
execution, delivery and performance by it of this Amendment does not and will not require any
consent or approval, which has not already been obtained, from any Governmental Authority,
equityholder or any other Person, (e) the execution, delivery and performance by it of this
Amendment shall not result in the breach of, or constitute a default under, any material agreement
or instrument to which it is a party and (f) this Amendment and each of the Program Documents
(after giving effect to this Amendment) to which it is a party constitutes its legal, valid and
binding obligations, enforceable against it in accordance with their respective terms, except as
limited by bankruptcy, reorganization, insolvency, fraudulent conveyance, moratorium and other
similar laws (whether statutory, regulatory or decisional) and general equitable principles
affecting creditors’ rights and remedies regardless of whether such enforceability is considered in
a proceeding in equity or at law. The Sellers represent and warrant that no Default or Event of
Default has occurred. Each of the Seller and Guarantor represents and warrants that it is in
compliance with all provisions and terms of the Repurchase Agreement and each other Program
Document to which it is a party and by which it may be bound.



3. Expenses. Sellers shall promptly reimburse Buyers for all out-of-pocket costs and
expenses of Buyers in connection with the preparation, execution and delivery of this Amendment
(including, without limitation, the fees and expenses of counsel for Buyers).



4. Entire Agreement; No Other Changes. This Amendment supersedes and integrates all
previous negotiations, contracts, agreements and understandings between the parties with respect to
the subject matter hereof, and it contains the entire final agreement of the parties. Except as
expressly modified or amended in this Amendment, all of the terms, covenants, provisions,
agreements and conditions of the Repurchase Agreement and the Pricing Side letter are hereby
ratified and confirmed in every respect and shall remain unmodified and unchanged and shall
continue in full force and effect.



5. Severability. If any provision of this Amendment is declared invalid by any court
of competent jurisdiction, such invalidity shall not affect any other provision of this Amendment,
and this Amendment shall be enforced to the fullest extent permitted by law.



6. Counterparts. This Amendment may be executed in any number of counterparts and by
the parties hereto in separate counterparts, each of which when so executed and delivered shall be
deemed to be an original and all of which taken together shall constitute one and the same
instrument.



7. GOVERNING LAW; WAIVER OF JURY TRIAL. THIS AGREEMENT SHALL BE CONSTRUED IN
ACCORDANCE WITH, AND GOVERNED BY, THE LAWS OF THE STATE OF NEW YORK, WITHOUT GIVING EFFECT TO THE
CONFLICT OF LAWS PRINCIPLES THEREOF (EXCEPT FOR SECTION 5-1401 AND SECTION 5-1402 OF THE NEW YORK
GENERAL OBLIGATIONS LAW). THE PARTIES HERETO EACH HEREBY WAIVE THE RIGHT OF A TRIAL BY JURY IN ANY
LITIGATION ARISING HEREUNDER.



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IN WITNESS WHEREOF, the parties hereto have caused their duly authorized officers to
execute this Amendment Number Two to Master Repurchase Agreement and Pricing Side Letter as of the
date first written above.



ECC SPV II, as Seller


By: ECC Capital Corporation, as Administrator



By: /s/ WilliamE.Moffatt

Name: William E. Moffatt

Title: Director, Warehouse Lending







ENCORE SPV II, as Seller

By: Encore Credit Corp., as Administrator



By: /s/ William E. Moffatt

Name: William E. Moffatt

Title: Director, Warehouse Lending







BRAVO SPV II, as Seller

By: Bravo Credit Corporation, as Administrator



By: /s/ William E. Moffatt

Name: William E. Moffatt

Title: Director, Warehouse Lending







ECC CAPITAL CORPORATION, as Originator and Guarantor



By: /s/ William E. Moffatt

Name: William E. Moffatt

Title: Director, Warehouse Lending







ENCORE CREDIT CORP., as Guarantor and Originator



By: /s/ William E. Moffatt

Name: William E. Moffatt

Title: Director, Warehouse Lending







BRAVO CREDIT CORPORATION, as Guarantor and Originator



By: /s/ William E. Moffatt

Name: William E. Moffatt

Title: Director, Warehouse Lending









DB STRUCTURED PRODUCTS, INC., as Buyer and Agent, as applicable



By: /s/ Frank Byrne

Name: Frank Byrne

Title: Managing Director





By: /s/ Vincent D’Amore

Name: Vincent D’Amore

Title: Authorized Signatory



ASPEN FUNDING CORP., as Buyer and Agent, as applicable



By: /s/ Doris J. Hearn

Name: Doris J. Hearn

Title: Vice President







NEWPORT FUNDING CORP., as Buyer and Agent, as applicable



By: /s/ Doris J. Hearn

Name: Doris J. Hearn

Title: Vice President




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