Exhibit 10.06





Exhibit 10.06




 




 


AGREEMENT
TO EXTEND MANAGEMENT AGREEMENT


             This Agreement to Extend Management
Agreement (the "Extension Agreement") is made as of December 17,
2001, by and between FBR Asset Investment Corporation (the "Company")
and Friedman, Billings, Ramsey Investment Management, Inc. (the "Manager").


             WHEREAS, the Company and the Manager
are parties to that certain Management Agreement, dated as of December 17,
1997, as extended and amended by that certain Agreement to Extend and Amend
Management Agreement, dated as of December 17, 1999, as further extended and
amended by that certain Agreement to Extend and Amend Management Agreement,
dated as of December 17, 2000 (the "Management Agreement");


             WHEREAS, the Management Agreement
provides in Section 12 thereof that the parties may extend the term of the
Management Agreement for up to 12 months by executing a written extension; and


             WHEREAS, the parties have determined
to extend the term of the Management Agreement by 12 months, from December 17,
2001 to December 17, 2002, in accordance with Section 12 of the Management
Agreement.


             NOW, THEREFORE, in consideration of
the mutual agreements set forth herein, the parties agree as follows:


             SECTION 1.  Extension.  The
parties hereby agree to extend the term of the Management Agreement by 12
months, from December 17, 2001 to December 17, 2002.


             SECTION 2.  Other terms.  Other
than as expressly extended hereby, all other terms, conditions and provisions
of the Management Agreement shall remain in effect during the 12 month extension
provided for hereby, unless the Management Agreement is amended in writing by
the parties or is sooner terminated in accordance with the provisions thereof.


             IN WITNESS WHEREOF, the parties
hereto have executed this Extension Agreement as of the date first written
above.


 


 


	FBR
ASSET INVESTMENT CORPORATION 	FRIEDMAN,
BILLINGS, RAMSEY

       INVESTMENT
MANAGEMENT, INC.


    
		                                           


    
		

 


    
	By:   /s/
Richard Hendrix                        	By:   /s/ Kurt R.
Harrington                   


    
	Name:  Richard Hendrix     	Name:  Kurt R. Harrington


    
	Title:    Chief Operating Officer 	Title:     Chief Financial Officer


    



 


 





 


 


MANAGEMENT
AGREEMENT


        This Management Agreement ("Agreement") is made
and entered into as of December 17, 1997, by and between FBR Asset Investment
Corporation, a Virginia corporation (the "Company"), and Friedman, Billings,
Ramsey Investment Management, Inc., a Delaware corporation (the "Manager").


RECITALS


        WHEREAS, the Company intends to conduct its business in
the manner described in the Private Offering Memorandum, dated December 11,
1997 (the "Memorandum") and expects to qualify for the tax benefits
accorded by Sections 856 through 860 of the Internal Revenue Code of 1986, as
amended (the "Code"); and


        WHEREAS, the Company desires to retain the Manager to
acquire, sell and otherwise manage the investments of the Company and to
perform administrative services for the Company in the manner and on the terms
set forth herein;


        NOW THEREFORE, in consideration of the mutual agreements
herein set forth, the parties hereto agree as follows:


        SECTION 1.       Definitions.  Capitalized terms used herein but not
otherwise defined shall have the respective meanings assigned them in the
Memorandum.  In addition, the following
terms shall have the meanings assigned them.



  
    (a)               
"Agreement" means this Management Agreement, as
amended from time to time.

    (b)              
"Closing Date" means the date of closing of the
Company's initial offering of common stock pursuant to the Memorandum.

    (c)               
"Governing Instruments" means the articles of
incorporation and bylaws of a corporation.

  




        SECTION 2.       Duties
of the Manager.



  

(a)               
Administration and Operation of the Company.  The Manager at all times will be subject to
the supervision of the Company's Board of Directors and will have only such
functions and authority as stated in this Agreement or as the Company may
delegate to it.  The Manager will be
responsible for the day-to-day operations of the Company and will perform (or
cause to be performed) such services and activities relating to the assets and
operations of the Company as may be appropriate, including:


(i)                 
serving as the Company's consultant with respect to
formulation of investment criteria and policy guidelines;


 


  






 



  

(ii)               
representing the Company in connection with the purchase and
commitment to purchase assets, the sale and commitment to sell assets, and the
maintenance and administration of its portfolio of  assets;


(iii)              
furnishing reports and statistical and economic research to
the Company regarding the Company's activities and the services performed for
the Company by the Manager;


(iv)             
monitoring and providing to the Board of Directors on an
ongoing basis price information and other data, obtained from certain
nationally recognized dealers that maintain markets in assets identified by the
Board of Directors from time to time, and providing data and advice to the
Board of Directors in connection with the identification of such dealers;


(v)               
providing certain executive and administrative personnel,
office space and office services required in rendering services to the Company;


(vi)             
administering the day-to-day operations of the Company and
performing and supervising the performance of such other administrative
functions necessary in the management of the Company as may be agreed upon by
the Manager and the Board of Directors, including the collection of revenues
and the payment of the Company's debts and obligations and maintenance of
appropriate computer services to perform such administrative functions;


(vii)            
communicating on behalf of the Company with the holders of any
equity or debt securities of the Company as required to satisfy the reporting
and other requirements of any trading markets or any governmental bodies or
agencies and to maintain effective relations with such holders;


(viii)          
to the extent not otherwise subject to an agreement executed
by the Company, designating a servicer for mortgage loans sold to the Company
and arranging for the monitoring and administering of such servicers;


(ix)             
counseling the Company in connection with policy decisions to
be made by the Board of Directors;


(x)               
counseling the Company regarding the maintenance of its status
as a REIT and monitoring compliance with the various REIT qualification tests
and other rules set out in the Code and regulations thereunder;


(xi)             
engaging in hedging activities on behalf of the Company,
consistent with the Company's status as a REIT;


(xii)            
upon request by and in accordance with the directions of the
Board of Directors, investing or reinvesting any money of the Company; and


 


  






 



  

(xiii)          
counseling the Company regarding the maintenance of its
exemption from the Investment Company Act and monitoring compliance with the
various requirements for such exemption.


(b)              
Portfolio Management. 
The Manager will perform portfolio management services on behalf of the
Company with respect to the Company's investments.  Such services will include, but not be limited to, consulting
with the Company on purchase and sale opportunities; collection of information
and submission of reports pertaining to the Company's assets, interest rates,
and general economic conditions; periodic review and evaluation of the
performance of the Company's portfolio of assets; acting as liaison between the
Company and banking, mortgage banking, investment banking and other parties
with respect to the purchase, financing and disposition of assets; and other
customary functions related to portfolio management.  The Manager may enter into subcontracts with other parties,
including its Affiliates, to provide any such services to the Company.


(c)               
Reasonable Best Efforts. 
The Manager agrees to use its reasonable best efforts at all times in
performing services for the Company hereunder.


  




        SECTION 3.       Additional
Activities of Manager.  Nothing herein
shall prevent the Manager or any of its Affiliates from engaging in other
businesses or from rendering services of any kind to any other person or
entity, including investment in, or advisory service to others investing in,
any type of real estate investment, including investments that meet the
principal investment objectives of the Company.


        The Manager will allocate investment opportunities among
investors for whom the Manager and its Affiliates manage assets based upon
primary investment objectives, applicable investment restrictions, and such
other factors as the Manager deems appropriate and fair under the
circumstances.


        Directors, officers, employees and agents of the Manager
or its Affiliates may serve as directors, officers, employees, agents, nominees
or signatories for the Company, to the extent permitted by the Company's
Governing Instruments, as from time to time amended, or by any resolutions duly
adopted by the Board of Directors pursuant to the Company's Governing Instruments.  When executing documents or otherwise acting
in such capacities for the Company, such persons shall use their respective
titles in the Company.


        SECTION 4.       Commitments.  In order to meet the investment requirements
of the Company, as determined by the Board of Directors from time to time, the
Manager agrees, at the direction of the Board of Directors, to issue on behalf
of the Company commitments on such terms as are established by the Board of
Directors for the purchase of investments.


        SECTION 5.       Bank
Accounts.  At the direction of the Board
of Directors, the Manager may establish and maintain one or more bank accounts
in the name of the Company, and may collect and deposit into any such account
or accounts, and disburse funds from any such account or accounts, under such
terms and conditions as the Board of Directors may approve; and the Manager
shall from time to time render appropriate accountings of such collections and
payments to the Board of Directors and, upon request, to the auditors of the
Company.


 





 


        SECTION 6.       Records;
Confidentiality.  The Manager shall
maintain appropriate books of accounts and records relating to services
performed hereunder, and such books of account and records shall be accessible
for inspection by representatives of the Company at any time during normal
business hours.  The Manager shall keep
confidential any and all information obtained in connection with the services
rendered hereunder and shall not disclose any such information to nonaffiliated
third parties except with the prior written consent of the Board of Directors.


        SECTION 7.       Obligations
of Manager.




(a)               
The Manager shall require each seller or transferor of
investments to the Company to make such representations and warranties
regarding such investments as may, in the judgment of the Manager, be necessary
and appropriate.  In addition, the
Manager shall take such other action as it deems necessary or appropriate with
regard to the protection of the Company's investments. 


(b)              
The Manager shall refrain from any action that, in its sole
judgment made in good faith, would adversely affect the status of the Company
as a REIT or that, in its sole judgment made in good faith, would violate any
law, rule or regulation of any governmental body or agency having jurisdiction
over the Company or that would otherwise not be permitted by the Company's
Governing Instruments.  If the Manager
is ordered to take any such action by the Board of Directors, the Manager shall
promptly notify the Board of Directors of the Manager's judgment that such
action would adversely affect such status or violate any such law, rule or
regulation, or the Governing Instruments. Notwithstanding the foregoing, the
Manager, its directors, officers, stockholders and employees shall not be
liable to the Company, the Independent Directors, or the Company's stockholders
or partners for any act or omission by the Manager, its directors, officers,
stockholders or employees except as provided in Section 10 of this Agreement.





        SECTION 8.       Compensation.




(a)               
Commencing with the first calendar quarter ending after the
Closing Date, the Company shall pay to the Manager, for services rendered under
this Agreement, a quarterly base management fee in an amount equal to the sum
of (a) 1/4 of 1% per annum (adjusted to reflect a quarterly period) of the
Average  Invested Mortgage Assets of the
Company during each calendar quarter (or a pro rata amount based on the number
of days elapsed during any partial calendar quarter) and (b) 3/4 of 1% per
annum of the remainder of the Average Invested Assets of the Company during
each calendar quarter (or a pro rata amount based on the number of days elapsed
during any partial calendar quarter). 
After the end of each calendar year (beginning with 1998), the Manager
may, and at the request of the Company shall, provide an analysis of the costs
of providing services under this Agreement during such calendar year.  This information may be used by the Company
to adjust the base management fee in order to align it more closely with the
actual costs of such services, or with the consent of the Manager, to reduce
the base management fee to the extent the Company incurs costs internally.  No more than one such adjustment may be made
in any calendar year.


 







 




(b)              
The Manager shall be entitled to receive incentive
compensation based on the performance of the Company.  At the end of 1998, the Manager will be entitled to receive the
Incentive Calculation Amount for the period from the Closing Date through
December 31, 1998.  For each calendar
quarter thereafter beginning with the quarter ended March 31, 1999, the Manager
will be entitled to receive 25% of the Incentive Calculation Amount for the 12
month period ending with the end of that calendar quarter.





        As used herein, the Incentive Calculation Amount for any
period means an amount equal to the product of (A) 25% of the dollar amount by
which (1)(a) Funds from Operations (before the incentive fee but after the base
management fee) of the Company per share (based on the weighted average number
of shares outstanding) plus (b) gains (or minus losses) from debt restructuring
and sales of property per share (based on the weighted average number of shares
outstanding), exceed (2) an amount equal to (a) the weighted average of the
price per share at the Offering Price and the prices per share at any secondary
offerings by the Company multiplied by (b) the Ten-Year U.S.  Treasury Rate plus five percent per annum
multiplied by (B) the weighted average number of Common Shares outstanding
during such period.


        "Funds from Operations" shall be computed in
accordance with the definition thereof adopted by the National Association of
Real Estate Investment Trusts ("NAREIT") and shall mean net income
(computed in accordance with GAAP) excluding gains (or losses) from debt
restructuring and sales of property, plus depreciation and amortization on real
estate assets, and after adjustments for unconsolidated partnerships and joint
ventures.


        As used in calculating the Manager's compensation, the
term "Ten Year U.S.  Treasury Rate"
means the arithmetic average of the weekly average yield to maturity for
actively traded current coupon U.S. 
Treasury fixed interest rate securities (adjusted to constant maturities
of ten years) published by the Federal Reserve Board during a quarter, or if
such rate is not published by the Federal Reserve Board, any Federal Reserve
Bank or agency or department of the federal government selected by the
Company.  If the Company determines in
good faith that the Ten Year U.S. 
Treasury Rate cannot be calculated as provided above, then the rate
shall be the arithmetic average of the per annum average yields to maturities,
based upon closing asked prices on each business day during a quarter, for each
actively traded marketable U.S. Treasury fixed interest rate security with a
final maturity date not less than eight nor more than twelve years from the
date of the closing asked prices as chosen and quoted for each business day in
each such quarter in New York City by at least three recognized dealers in
U.S.  government securities selected by
the Company.


 





 




(c)               
The Manager shall compute the compensation payable under
Sections 8(a) and 8(b) of this Agreement within 45 days after the end of each
calendar quarter.  A copy of the
computations made by the Manager to calculate its compensation shall thereafter
promptly be delivered to the Company and, upon such delivery, payment of the
compensation earned under Sections 8(a) and 8(b) of this Agreement shown
therein shall be due and payable within 60 days after the end of such calendar
quarter.


(d)              
The Manager may charge the Company for any out of pocket
expenses that the Manager incurs in connection with any due diligence on assets
considered for purchase by the Company. 
Moreover, the Manager shall document the time spent by the Manager's
employees in performing such due diligence and shall be entitled to
reimbursement for the allocable portion of such employees' salaries and
benefits provided, however, that (i) the amount of due diligence costs for
which the Manager receives reimbursement with respect to any asset shall not
exceed an arm's length due diligence fee for such asset and (ii) the Manager
shall not be entitled to reimbursement for any due diligence or employee time
costs associated with investments in securities being underwritten or placed by
an Affiliate of the Manager.





        SECTION 9.       Calculations
of Expenses.  Expenses incurred by the
Manager on behalf of the Company shall be reimbursed quarterly to the Manager
within 60 days after the end of each quarter. 
The Manager shall prepare a statement documenting the expenses of the
Company and those incurred by the Manager on behalf of the Company during each
quarter, and shall deliver such statement to the Company within 45 days after
the end of each quarter. 


        SECTION 10.   Limits of
Manager Responsibility.  The Manager
assumes no responsibility under this Agreement other than to render the
services called for hereunder in good faith and shall not be responsible for
any action of the Company in following or declining to follow any advice or
recommendations of the Manager, including as set forth in Section 7(b) of this Agreement.  The Manager, its Affiliates, and their
respective directors, officers, stockholders and employees will not be liable
to the Company, any subsidiary, the Independent Directors or the Company's or
any subsidiary's shareholders, creditors, or partners for any acts or omissions
by the Manager, its Affiliates, and their respective directors, officers,
stockholders or employees under or in connection with this Agreement, except by
reason of acts constituting bad faith, willful misconduct, gross negligence or
reckless disregard of their duties.  The
Manager may consult with and rely upon counsel in any case where it appears to
the Manager to be necessary or desirable with respect to its authority and
obligations under this Agreement. 
Additionally, the Manager may rely and act upon any certificates or
other instruments believed in good faith by the Manager to be genuine and to
have been signed by any person duly authorized.  The Company shall reimburse, indemnify and hold harmless the
Manager, its stockholders, directors, officers and employees of and from any
and all expenses, losses, damages, liabilities, demands, charges and claims of
any nature whatsoever, (including attorneys' fees) in respect of or arising
from any acts or omissions of the Manager, its stockholders, directors,
officers and employees made in good faith in the performance of the Manager's
duties under this Agreement and not constituting bad faith, willful misconduct,
gross negligence or reckless disregard of its duties.


 





 


        SECTION 11.   No Joint
Venture.  The Company and the Manager
are not partners or joint venturers with each other and nothing herein shall be
construed to make them such partners or joint venturers or impose any liability
as such on either of them.


        SECTION 12.   Term;
Termination.  This Agreement shall
commence on the Closing Date and shall continue in force until the second
anniversary of the Closing Date, and thereafter, it may be extended only with
the consent of the Manager and by the affirmative vote of a majority of the
Board of Directors of the Company, including a majority vote of the Independent
Directors. 


        Each extension shall be executed in writing by the parties
and shall be dated as of the expiration of this Agreement or any extension
thereof.  Each such extension shall not
exceed twelve months.  


        Notwithstanding any other provision to the contrary, this
Agreement, or any extension hereof, may be terminated by the Company without
cause, upon 60 days written notice, by a majority vote of the Independent
Directors or by majority vote of the holders of the outstanding Common Shares;
provided that the base management fee and incentive management fee earned
during the twelve months preceding such termination, will be due.


        If this Agreement is terminated pursuant to this Section
12, such termination shall be without any further liability or obligation of
either party to the other, except as provided in Section 16 of this Agreement.


        SECTION 13.   Assignments.




(a)               
Except as set forth in subsection (b) of this Section 13, this
Agreement shall terminate automatically in the event of its assignment, in
whole or in part, by the Manager, unless such assignment is consented to in
writing by the Company with the consent of a majority of the Independent
Directors.  Any such assignment shall
bind the assignee hereunder in the same manner as the Manager is bound.  In addition, the assignee shall execute and
deliver to the Company a counterpart of this Agreement naming such assignee as
Manager.  This Agreement shall not be
assigned by the Company without the prior written consent of the Manager,
except in the case of assignment by the Company to another Company or other
organization that is a successor (by merger, consolidation or purchase of
assets) to the Company, in which case such successor organization shall be
bound hereunder and by the terms of such assignment in the same manner as the
Company is bound hereunder.


 







 




(b)              
Notwithstanding any provision of this Agreement, the Manager
may subcontract and assign any or all of its responsibilities under Sections
2(a) and 2(b) of this Agreement to any of its Affiliates or to Blackrock
Financial Management, Inc., and the Company hereby consents to any such
assignment and subcontracting.





        SECTION 14.   Termination
by Company for Cause.  At the option of
the Company, this Agreement shall be and become terminated upon 60 days'
written notice of termination from a majority of the Independent Directors to
the Manager, without payment of any termination fee, if any of the following
events shall occur: 




(a)               
if the Manager shall violate any material provision of this Agreement
and, after notice of such violation, shall not cure such violation within 30
days; or


(b)              
there is entered an order for relief or similar decree or  order with respect to the Manager by a court
having competent  jurisdiction in an
involuntary case under the federal bankruptcy laws  as now or hereafter constituted or under any applicable federal
or  state bankruptcy, insolvency or
other similar laws; or the Manager (i) ceases, or admits in writing its
inability to pay its debts as they 
become due and payable, or makes a general assignment for the
benefit  of, or enters into any
composition or arrangement with, creditors; (ii)  applies for, or consents (by admission of material allegations of
a  petition or otherwise) to the
appointment of a receiver, trustee, 
assignee, custodian, liquidator or sequestrator (or other similar  official) of the Manager or of any
substantial part of its properties  or
assets, or authorizes such an application or consent, or proceedings  seeking such appointment are commenced
without such authorization,  consent or
application against the Manager and continue undismissed for  30 days; (iii) authorizes or files a
voluntary petition in bankruptcy,  or
applies for or consents (by admission of material allegations of a  petition or otherwise) to the application of
any bankruptcy,  reorganization,
arrangement, readjustment of debt, insolvency, 
dissolution, liquidation or other similar law of any jurisdiction,
or  authorizes such application or
consent, or proceedings to such end are 
instituted against the Manager without such authorization,
application  or consent and are approved
as properly instituted and remain 
undismissed for 30 days or result in adjudication of bankruptcy or  insolvency; or (iv) permits or suffers all
or any substantial part of  its
properties or assets to be sequestered or attached by court order  and the order remains undismissed for 30
days.





        If any of the events specified in this Section 14 shall
occur, the Manager shall give prompt written notice thereof to the Board of
Directors upon the happening of such event.


        SECTION 15.   Action Upon
Termination.  From and after the
effective date of termination of this Agreement pursuant to Sections 12, 13, or
14 of this Agreement, the Manager shall not be entitled to compensation for
further services hereunder, but shall be paid all compensation accruing to the
date of termination and, if terminated by the Company pursuant to Section 12,
the applicable termination fee.  Upon
such termination, the Manager shall forthwith: 





  




(a)               
after deducting any accrued compensation and
reimbursement  for its expenses to which
it is then entitled, pay over to the Company 
all money collected and held for the account of the Company pursuant
to  this Agreement;


(b)              
deliver to the Company a full accounting, including a  statement showing all payments collected by
it and a statement of all  money held by
it, covering the period following the date of the last  accounting furnished to the Board of
Directors with respect to the  Company;
and


(c)               
deliver to the Company all property and documents of the  Company then in the custody of the Manager.





        SECTION 16.   Release of
Money or Other Property Upon Written Request. 
The Manager agrees that any money or other property of the Company held
by the Manager under this Agreement shall be held by the Manager as custodian
for the Company, and the Manager's records shall be appropriately marked
clearly to reflect the ownership of such money or other property by the
Company.  Upon the receipt by the
Manager of a written request signed by a duly authorized officer of the Company
requesting the Manager to release to the Company any money or other property
then held by the Manager for the account of the Company under this Agreement,
the Manager shall release such money or other property to the Company within a
reasonable period of time, but in no event later than 60 days following such
request.  The Manager shall not be
liable to the Company, any subsidiary, the Independent Directors, or the
Company's or a subsidiary's stockholders or partners for any acts performed or
omissions to act by the Company in connection with the money or other property
released to the Company in accordance with this Section.  The Company shall indemnify the Manager, its
directors, officers, stockholders and employees against any and all expenses,
losses, damages, liabilities, demands, charges and claims of any nature
whatsoever, which arise in connection with the Manager's release of such money
or other property to the Company in accordance with the terms of this Section
16.  Indemnification pursuant to this
provision shall be in addition to any right of the Manager to indemnification
under Section 10 of this Agreement.


        SECTION 17.   Representations
and Warranties.




(a)               
The Company hereby represents and warrants to the Manager as
follows:





          (i)                 
The Company is duly organized, validly existing and in  good standing under the laws of the
Commonwealth of Virginia, has the 
corporate power to own its assets and to transact the business in
which  it is now engaged and is duly
qualified as a foreign corporation and in 
good standing under the laws of each jurisdiction where its
ownership  or lease of property or the
conduct of its business requires such 
qualification, except for failures to be so qualified, authorized
or  licensed that could not in the aggregate
have a material adverse effect  on the
business operations, assets or financial condition of the  Company and its subsidiaries, taken as a
whole.  The Company does not do  business under any fictitious business name.




 







 


         (ii)               
The Company has the corporate power and authority to  execute, deliver and perform this Agreement
and all obligations  required hereunder
and has taken all necessary corporate action to  authorize this Agreement on the terms and conditions hereof and
the  execution, delivery and performance
of this Agreement and all  obligations
required hereunder.  No consent of any
other person  including, without
limitation, stockholders and creditors of the 
Company, and no license, permit, approval or authorization of,  exemption by, notice or report to, or
registration, filing or  declaration
with, any governmental authority is required by the Company  in connection with this Agreement or the
execution, delivery,  performance,
validity or enforceability of this Agreement and all  obligations required hereunder. 
This Agreement has been, and each 
instrument or document required hereunder will be, executed and  delivered by a duly authorized officer of
the Company, and this  Agreement
constitutes, and each instrument or document required  hereunder when executed and delivered hereunder will constitute,
the  legally valid and binding
obligation of the Company enforceable against 
the Company in accordance with its terms.


         (iii)              
The execution, delivery and performance of this  Agreement and the documents or instruments
required hereunder will not  violate any
provision of any existing law or regulation binding on the  Company, or any order, judgment, award or
decree of any court,  arbitrator or
governmental authority binding on the Company, or the  Governing Instruments of, or any securities issued by the Company
or of  any mortgage, indenture, lease,
contract or other agreement, instrument 
or undertaking to which the Company is a party or by which the
Company  or any of its assets may be
bound, the violation of which would have a 
material adverse effect on the business operations, assets or
financial  condition of the Company and
its subsidiaries, taken as a whole, and 
will not result in, or require, the creation or imposition of any
lien  on any of its property, assets or
revenues pursuant to the provisions  of
any such mortgage, indenture, lease, contract or other agreement,  instrument or undertaking.




(b)              
The Manager hereby represents and warrants to the Company as
follows:





          (i)                 
the Manager is duly organized, validly existing and in  good standing under the laws of the
jurisdiction of its formation, has  the
corporate power to own its assets and to transact the business in  which it is now engaged and is duly
qualified to do business and is in  good
standing under the laws of each jurisdiction where its ownership  or lease of property or the conduct of its
business requires such  qualification,
except for failures to be so qualified, authorized or  licensed that could not in the aggregate have a material adverse
effect  on the business operations,
assets or financial condition of the 
Manager and its subsidiaries, taken as a whole.  The Manager does not do  business under any fictitious business name.


 





 


        (ii)               
The Manager has the corporate power and authority to  execute, deliver and perform this Agreement
and all obligations  required hereunder
and has taken all necessary corporate action to  authorize this Agreement on the terms and conditions hereof and
the  execution, delivery and performance
of this Agreement and all  obligations
required hereunder.  No consent of any
other person  including, without
limitation, stockholders and creditors of the 
Manager, and no license, permit, approval or authorization of,  exemption by, notice or report to, or
registration, filing or  declaration
with, any governmental authority is required by the Manager  in connection with this Agreement or the
execution, delivery,  performance,
validity or enforceability of this Agreement and all  obligations required hereunder. 
This Agreement has been, and each 
instrument or document required hereunder will be, executed and  delivered by a duly authorized agent of the
Manager, and this Agreement 
constitutes, and each instrument or document required hereunder
when  executed and delivered hereunder
will constitute, the legally valid and 
binding obligation of the Manager enforceable against the Manager
in  accordance with its terms.


        (iii)              
The execution, delivery and performance of this  Agreement and the documents or instruments
required hereunder, will not  violate
any provision of any existing law or regulation binding on the  Manager, or any order, judgment, award or
decree of any court,  arbitrator or
governmental authority binding on the Manager, or the  partnership agreement of, or any securities issued by the Manager
or of  any mortgage, indenture, lease,
contract or other agreement, instrument 
or undertaking to which the Manager is a party or by which the Manager  or any of its assets may be bound, the
violation of which would have a 
material adverse effect on the business operations, assets or
financial  condition of the Manager and
its subsidiaries, taken as a whole, and 
will not result in, or require, the creation or imposition of any
lien  on any of its property, assets or
revenues pursuant to the provisions  of
any such mortgage, indenture, lease, contract or other agreement,  instrument or undertaking.


 


        SECTION 18.   Notices. 
Unless expressly provided otherwise herein,
all notices, requests, demands and other communications required or permitted
under this Agreement shall be in writing and shall be deemed to have been duly
given, made and received when delivered against receipt or upon actual receipt
of registered or certified mail, postage prepaid, return receipt requested,
addressed as set forth below:


	(a)               


    	 If to the Company:
		  
		

FBR Asset Investment Corporation 

		1001 Nineteenth Street, North

		Arlington, Virginia 22209

		Attention:  Secretary

		
	                                           
      with a copy given in the manner prescribed

                                                 
      above, to:
	                                            


 




 
 

		George C.  Howell, III, Esquire

		Hunton & Williams

		951 East Byrd Street

		Richmond, Virginia 23219-4074

		 


    
	                        
      (b)  	If to the Manager:


    
		

Friedman, Billings, Ramsey Investment Management, Inc.

		1001 Nineteenth Street, North

		Arlington, Virginia 22209

		Attention:  Secretary

		 

	                                        
      with a copy given in the manner prescribed

                                              
      above, to:
	                                         
		 

		George C.  Howell, III, Esquire

		Hunton & Williams

		951 East Byrd Street

		Richmond, Virginia 23219-4074



 


        Either party may alter the address to which communications
or copies are to be sent by giving notice of such change of address in
conformity with the provisions of this Section 18 for the giving of notice.


        SECTION 19.   Binding
Nature of Agreement; Successors and Assigns. 
This Agreement shall be binding upon and inure to the benefit of the
parties hereto and their respective heirs, personal representatives, successors
and assigns as provided herein.


        SECTION 20.   Entire
Agreement.  This Agreement contains the
entire agreement and understanding among the parties hereto with respect to the
subject matter hereof, and supersedes all prior and contemporaneous agreements,
understandings, inducements and conditions, express or implied, oral or
written, of any nature whatsoever with respect to the subject matter
hereof.  The express terms hereof
control and supersede any course of performance and/or usage of the trade
inconsistent with any of the terms hereof. 
This Agreement may not be modified or amended other than by an agreement
in writing.


        SECTION 21.   Controlling
Law.  This Agreement and all questions
relating to its validity, interpretation, performance and enforcement shall be
governed by and construed, interpreted and enforced in accordance with the laws
of the Commonwealth of Virginia, notwithstanding any Virginia or other
conflict-of-law provisions to the contrary.


        SECTION 22.   Indulgences,
Not Waivers.  Neither the failure nor
any delay on the part of a party to exercise any right, remedy, power or
privilege under this Agreement shall operate as a waiver thereof, nor shall any
single or partial exercise of any right, remedy, power or privilege preclude
any other or further exercise of the same or of any other right, remedy, power
or privilege, nor shall any waiver of any right, remedy, power or privilege
with respect to any occurrence be construed as a waiver of such right, remedy,
power or privilege with respect to any other occurrence.  No waiver shall be effective unless it is in
writing and is signed by the party asserted to have granted such waiver.


 





 


        SECTION 23.   Costs and
Expenses.  Each party hereto shall bear
its own costs and expenses (including the fees and disbursements of counsel and
accountants) incurred in connection with the negotiations and preparation of
and the closing under this Agreement, and all matters incident thereto.


        SECTION 24.   Titles Not
to Affect Interpretation.  The titles of
paragraphs and subparagraphs contained in this Agreement are for convenience
only, and they neither form a part of this Agreement nor are they to be used in
the construction or interpretation hereof.


        SECTION 25.   Execution in
Counterparts.  This Agreement may be
executed in any number of counterparts, each of which shall be deemed to be an
original as against any party whose signature appears thereon, and all of which
shall together constitute one and the same instrument.  This Agreement shall become binding when one
or more counterparts hereof, individually or taken together, shall bear the
signatures of all of the parties reflected hereon as the signatories.


        SECTION 26.   Provisions
Separable.  The provisions of this
Agreement are independent of and separable from each other, and no provision
shall be affected or rendered invalid or unenforceable by virtue of the fact
that for any reason any other or others of them may be invalid or unenforceable
in whole or in part.


        SECTION 27.   Computation
of Interest.  Interest will be computed
on the basis of a 360-day year consisting of twelve months of thirty days each.


SIGNATURE PAGE FOLLOWS
 



 
 


        IN WITNESS WHEREOF, the parties hereto have executed this
Management Agreement as of the date first written above.


	


	

FBR ASSET INVESTMENT CORPORATION

	 

	 

	 

	
	By:    /s/ W. Russell Ramsey                                         

	 

	
	Name:  W.  Russell Ramsey

	
	Title:     President

		 
		FRIEDMAN, BILLINGS, RAMSEY

          INVESTMENT MANAGEMENT, INC.

		 
		 
		By:    /s/ Emanuel J. Friedman
		Name:  Emanuel J. Friedman
		Title:     Chief Executive Officer