EX-10.1






	 
	Master Repurchase
	Agreement
	 

	September 1996 Version

	 

	Dated as of November 28, 2005

	 

	Between: BEAR STEARNS MORTGAGE CAPITAL CORPORATION, as Buyer

	 

	and ENCORE CREDIT CORP., as Seller jointly and severally with the other Sellers

	 

	and BRAVO CREDIT CORPORATION, as Seller jointly and severally with the other Sellers

	 

	and CONQUISTAMERICA, INC, as Seller jointly and severally with the other Sellers

	 

	and ECC CAPITAL CORPORATION, as Seller jointly and severally with the other Sellers








	 	1.	 	Applicability






From time to time the parties hereto may enter into transactions in which one party (“Seller”)
agrees to transfer to the other (“Buyer”) securities or other assets (“Securities”) against the
transfer of funds by Buyer, with a simultaneous agreement by Buyer to transfer to Seller such
Securities at a date certain or on demand, against the transfer of funds by Seller. Each such
transaction shall be referred to herein as a “Transaction” and, unless otherwise agreed in
writing, shall be governed by this Agreement, including any supplemental terms or conditions
contained in Annex I hereto and in any other annexes identified herein or therein as applicable
hereunder.




	 	2.	 	Definitions






	 	(a)	 	“Act of Insolvency”, with respect to any party, (i) the commencement by such party as
debtor of any case or proceeding under any bankruptcy, insolvency, reorganization,
liquidation, moratorium, dissolution, delinquency or similar law, or such party seeking the
appointment or election of a receiver, conservator, trustee, custodian or similar official
for such party or any substantial part of its property, or the convening of any meeting of
creditors for purposes of commencing any such case or proceeding or seeking such an
appointment or election, (ii) the commencement of any such case or proceeding against such
party, or another seeking such an appointment or election, or the filing against a party of
an application for a protective decree under the provisions of the Securities Investor
Protection Act of 1970, which (A) is consented to or not timely contested by such party,
(B) results in the entry of an order for relief, such an appointment or election, the
issuance of such a protective decree or the entry of an order having a similar effect, or
(C) is not dismissed within 15 days, (iii) the making by such party of a general assignment
for the benefit of creditors, or (iv) the admission in writing by such party of such
party’s inability to pay such party’s debts as they become due;






	 	(b)	 	“Additional Purchased Securities”, Securities provided by Seller to Buyer pursuant to
Paragraph 4 (a) hereof;






	 	(c)	 	“Buyer’s Margin Amount”, with respect to any Transaction as of any date, the amount
obtained by application of the Buyer’s Margin Percentage to the Repurchase Price for such
Transaction as of such date;






	 	(d)	 	“Buyer’s Margin Percentage”, with respect to any Transaction as of any date, a
percentage (which may be equal to the Seller’s Margin Percentage) agreed to by Buyer and
Seller or, in the absence of any such agreement, the percentage obtained by dividing the
Market Value of the Purchased Securities on the Purchase Date by the Purchase Price on the
Purchase Date for such Transaction;






	 	(e)	 	“Confirmation”, the meaning specified in Paragraph 3 (b) hereof,






	 	(f)	 	“Income”, with respect to any Security at any time, any principal thereof and all
interest, dividends or other distributions thereon;






	 	(g)	 	“Margin Deficit”, the meaning specified in Paragraph 4 (a) hereof;






	 	(h)	 	“Margin Excess”, the meaning specified in Paragraph 4(b) hereof;






	 	(i)	 	“Margin Notice Deadline”, the time agreed to by the parties in the relevant
Confirmation, Annex I hereto or otherwise as the deadline for giving notice requiring
same-day satisfaction of margin maintenance obligations as provided in Paragraph 4 hereof
(or, in the absence of any such agreement, the deadline for such purposes established in
accordance with market practice);






	 	(j)	 	“Market Value”, with respect to any Securities as of any date, the price for such
Securities on such date obtained from a generally recognized source agreed to by the
parties or the most recent closing bid quotation from such a source, plus accrued Income to
the extent not included therein (other than any Income credited or transferred to, or
applied to the obligations of, Seller pursuant to Paragraph 5 hereof) as of such date
(unless contrary to market practice for such Securities);






	 	(k)	 	“Price Differential”, with respect to any Transaction as of any date, the aggregate
amount obtained by daily application of the Pricing Rate for such Transaction to the
Purchase Price for such Transaction on a 360 day per year basis for the actual number of
days during the period commencing on (and including) the Purchase Date for such Transaction
and ending on (but excluding) the date of determination (reduced by any amount of such
Price Differential previously paid by Seller to Buyer with respect to such Transaction);






	 	(l)	 	“Pricing Rate”, the per annum percentage rate for determination of the Price
Differential;






	 	(m)	 	“Prime Rate”, the prime rate of U.S. commercial banks as published in The Wall Street
Journal (or, if more than one such rate is published, the average of such rates);






	 	(n)	 	“Purchase Date”, the date on which Purchased Securities are to be transferred by Seller
to Buyer;






	 	(o)	 	“Purchase Price”, (i) on the Purchase Date, the price at which Purchased Securities are
transferred by Seller to Buyer, and (ii) thereafter, except where Buyer and Seller agree
otherwise, such price increased by the amount of any cash transferred by Buyer to Seller
pursuant to Paragraph 4 (b) hereof and decreased by the amount of any cash transferred by
Seller to Buyer pursuant to Paragraph 4 (a) hereof or applied to reduce Seller’s
obligations under clause (ii) of Paragraph 5 hereof;






	 	(p)	 	“Purchased Securities”, the Securities transferred by Seller to Buyer in a Transaction
hereunder, and any Securities substituted therefor in accordance with Paragraph 9 hereof.
The term “Purchased Securities” with respect to any Transaction at any time also shall
include Additional Purchased Securities delivered pursuant to Paragraph 4 (a) hereof and
shall exclude Securities returned pursuant to Paragraph 4(b) hereof;






	 	(q)	 	“Repurchase Date”, the date on which Seller is to repurchase the Purchased Securities
from Buyer, including any date determined by application of the provisions of Paragraph 3
(c) or 11 hereof;






	 	(r)	 	“Repurchase Price”, the price at which Purchased Securities are to be transferred from
Buyer to Seller upon termination of a Transaction, which will be determined in each case
(including Transactions terminable upon demand) as the sum of the Purchase Price and the
Price Differential as of the date of such determination;






	 	(s)	 	“Seller’s Margin Amount”, with respect to any Transaction as of any date, the amount
obtained by application of the Seller’s Margin Percentage to the Repurchase Price for such
Transaction as of such date;






	 	(t)	 	“Seller’s Margin Percentage”, with respect to any Transaction as of any date, a
percentage (which may be equal to the Buyer’s Margin Percentage) agreed to by Buyer and
Seller or, in the absence of any such agreement, the percentage obtained by dividing the
Market Value of the Purchased Securities on the Purchase Date by the Purchase Price on the
Purchase Date for such Transaction.






	 	3.	 	Initiation; Confirmation; Termination






	 	(a)	 	An agreement to enter into a Transaction may be made orally or in writing at the
initiation of either Buyer or Seller. On the Purchase Date for the Transaction, the
Purchased Securities shall be transferred to Buyer or its agent against the transfer of the
Purchase Price to an account of Seller.






	 	(b)	 	Upon agreeing to enter into a Transaction hereunder, Buyer or Seller (or both), as
shall be agreed, shall promptly deliver to the other party a written confirmation of each
Transaction (a “Confirmation”). The Confirmation shall describe the Purchased Securities
(including CUSIP number, if any), identify Buyer and Seller and set forth (i) the Purchase
Date, (ii) the Purchase Price, (iii) the Repurchase Date, unless the Transaction is to be
terminable on demand, (iv) the Pricing Rate or Repurchase Price applicable to the
Transaction, and (v) any additional terms or conditions of the Transaction not inconsistent
with this Agreement. The Confirmation, together with this Agreement, shall constitute
conclusive evidence of the terms agreed between Buyer and Seller with respect to the
Transaction to which the Confirmation relates, unless with respect to the Confirmation
specific objection is made promptly after receipt thereof. In the event of any conflict
between the terms of such Confirmation and this Agreement, this Agreement shall prevail.






	 	(c)	 	In the case of Transactions terminable upon demand, such demand shall be made by Buyer
or Seller, no later than such time as is customary in accordance with market practice, by
telephone or otherwise on or prior to the business day on which such termination will be
effective. On the date specified in such demand, or on the date fixed for termination in
the case of Transactions having a fixed term, termination of the Transaction will be
effected by transfer to Seller or its agent of the Purchased Securities and any Income in
respect thereof received by Buyer (and not previously credited or transferred to, or
applied to the obligations of, Seller pursuant to Paragraph 5 hereof) against the transfer
of the Repurchase Price to an account of Buyer.






	 	4.	 	Margin Maintenance






	 	(a)	 	If at any time the aggregate Market Value of all Purchased Securities subject to all
Transactions in which a particular party hereto is acting as Buyer is less than the
aggregate Buyer’s Margin Amount for all such Transactions (a “Margin Deficit”), then Buyer
may by notice to Seller require Seller in such Transactions, at Seller’s option, to
transfer to Buyer cash or additional Securities reasonably acceptable to Buyer (“Additional
Purchased Securities”), so that the cash and aggregate Market Value of the Purchased
Securities, including any such Additional Purchased Securities, will thereupon equal or
exceed such aggregate Buyer’s Margin Amount (decreased by the amount of any Margin Deficit
as of such date arising from any Transactions in which such Buyer is acting as Seller).






	 	(b)	 	If at any time the aggregate Market Value of all Purchased Securities subject to all
Transactions in which a particular party hereto is acting as Seller exceeds the aggregate
Seller’s Margin Amount for all such Transactions at such time (a “Margin Excess”), then
Seller may by notice to Buyer require Buyer in such Transactions, at Buyer’s option, to
transfer cash or Purchased Securities to Seller, so that the aggregate Market Value of the
Purchased Securities, after deduction of any such cash or any Purchased Securities so
transferred, will thereupon not exceed such aggregate Seller’s Margin Amount (increased by
the amount of any Margin Excess as of such date arising from any Transactions in which such
Seller is acting as Buyer).






	 	(c)	 	If any notice is given by Buyer or Seller under subparagraph (a) or (b) of this
Paragraph at or before the Margin Notice Deadline on any business day, the party receiving
such notice shall transfer cash or Additional Purchased Securities as provided in such
subparagraph no later than the close of business in the relevant market on such day. If any
such notice is given after the Margin Notice Deadline, the party receiving such notice
shall transfer such cash or Securities no later than the close of business in the relevant
market on the next business day following such notice.






	 	(d)	 	Any cash transferred pursuant to this Paragraph shall be attributed to such
Transactions as shall be agreed upon by Buyer and Seller.






	 	(e)	 	Seller and Buyer may agree, with respect to any or all Transactions hereunder, that the
respective rights of Buyer or Seller (or both) under subparagraphs (a) and (b) of this
Paragraph may be exercised only where a Margin Deficit or Margin Excess, as the case may
be, exceeds a specified dollar amount or a specified percentage of the Repurchase Prices
for such Transactions (which amount or percentage shall be agreed to by Buyer and Seller
prior to entering into any such Transactions).






	 	(f)	 	Seller and Buyer may agree, with respect to any or all Transactions hereunder, that the
respective rights of Buyer and Seller under subparagraphs (a) and (b) of this Paragraph to
require the elimination of a Margin Deficit or a Margin Excess, as the case may be, may be
exercised whenever such a Margin Deficit or Margin Excess exists with respect to any single
Transaction hereunder (calculated without regard to any other Transaction outstanding under
this Agreement).






	 	5.	 	Income Payments






Seller shall be entitled to receive an amount equal to all Income paid or distributed on or in
respect of the Securities that is not otherwise received by Seller, to the full extent it would
be so entitled if the Securities had not been sold to Buyer. Buyer shall, as the parties may
agree with respect to any Transaction (or, in the absence of any such agreement, as Buyer shall
reasonably determine in its discretion), on the date such Income is paid or distributed either
(i) transfer to or credit to the account of Seller such Income with respect to any Purchased
Securities subject to such Transaction or (ii) with respect to Income paid in cash, apply the
Income payment or payments to reduce the amount, if any, to be transferred to Buyer by Seller
upon termination of such Transaction. Buyer shall not be obligated to take any action pursuant
to the preceding sentence (A) to the extent that such action would result in the creation of a
Margin Deficit, unless prior thereto or simultaneously therewith Seller transfers to Buyer cash
or Additional Purchased Securities sufficient to eliminate such Margin Deficit, or (B) if an
Event of Default with respect to Seller has occurred and is then continuing at the time such
Income is paid or distributed.




	 	6.	 	Security Interest






Although the parties intend that all Transactions hereunder be sales and purchases and not
loans, in the event any such Transactions are deemed to be loans, Seller shall be deemed to have
pledged to Buyer as security for the performance by Seller of its obligations under each such
Transaction, and shall be deemed to have granted to Buyer a security interest in, all of the
Purchased Securities with respect to all Transactions hereunder and all Income thereon and other
proceeds thereof.




	 	7.	 	Payment and Transfer






Unless otherwise mutually agreed, all transfers of funds hereunder shall be in immediately
available funds. All Securities transferred by one party hereto to the other party (i) shall be
in suitable form for transfer or shall be accompanied by duly executed instruments of transfer
or assignment in blank and such other documentation as the party receiving possession may
reasonably request, (ii) shall be transferred on the book-entry system of a Federal Reserve
Bank, or (iii) shall be transferred by any other method mutually acceptable to Seller and Buyer.




	 	8.	 	Segregation of Purchased Securities






To the extent required by applicable law, all Purchased Securities in the possession of Seller
shall be segregated from other securities in its possession and shall be identified as subject
to this Agreement. Segregation may be accomplished by appropriate identification on the books
and records of the holder, including a financial or securities intermediary or a clearing
corporation. All of Seller’s interest in the Purchased Securities shall pass to Buyer on the
Purchase Date and, unless otherwise agreed by Buyer and Seller, nothing in this Agreement shall
preclude Buyer from engaging in repurchase transactions with the Purchased Securities or
otherwise selling, transferring, pledging or hypothecating the Purchased Securities, but no such
transaction shall relieve Buyer of its obligations to transfer Purchased Securities to Seller
pursuant to Paragraph 3, 4 or 11 hereof, or of Buyer’s obligation to credit or pay Income to, or
apply Income to the obligations of, Seller pursuant to Paragraph 5 hereof.



	 
	 







1




	 
	 

	Required Disclosure for Transactions in Which the Seller

Retains Custody of the Purchased Securities

Seller is not permitted to substitute other securities for those subject to this Agreement and therefore

must keep Buyer’s securities segregated at all times, unless in this Agreement Buyer grants Seller the right to

substitute other securities. If Buyer grants the right to substitute, this means that Buyer’s securities will

likely be commingled with Seller’s own securities during the trading day. Buyer is advised that, during any

trading day that Buyer’s securities are commingled with Seller’s securities, they [will] * [may] ** be subject

to liens granted by Seller to [its clearing bank] * [third parties] ** and may be used by Seller for deliveries

on other securities transactions. Whenever the securities are commingled, Seller’s ability to resegregate

substitute securities for Buyer will be subject to Seller’s ability to satisfy [the clearing] * [any]** lien or

to obtain substitute securities.

* Language to be used under 17 C.F.R. b403.4 (e) if Seller is a government securities broker

or dealer other than a financial institution.

** Language to be used under 17 C.F.R. b403.5(d) if Seller is a financial institution.

	 








	 	9.	 	Substitution






	 	(a)	 	Seller may, subject to agreement with and acceptance by Buyer, substitute other
Securities for any Purchased Securities. Such substitution shall be made by transfer to
Buyer of such other Securities and transfer to Seller of such Purchased Securities. After
substitution, the substituted Securities shall be deemed to be Purchased Securities.






	 	(b)	 	In Transactions in which Seller retains custody of Purchased Securities, the parties
expressly agree that Buyer shall be deemed, for purposes of subparagraph (a) of this
Paragraph, to have agreed to and accepted in this Agreement substitution by Seller of other
Securities for Purchased Securities; provided, however, that such other Securities shall
have a Market Value at least equal to the Market Value of the Purchased Securities for
which they are substituted.






	 	10.	 	Representations






Each of Buyer and Seller represents and warrants to the other that (i) it is duly authorized to
execute and deliver this Agreement, to enter into Transactions contemplated hereunder and to
perform its obligations hereunder and has taken all necessary action to authorize such
execution, delivery and performance, (ii) it will engage in such Transactions as principal (or,
if agreed in writing, in the form of an annex hereto or otherwise, in advance of any Transaction
by the other party hereto, as agent for a disclosed principal), (iii) the person signing this
Agreement on its behalf is duly authorized to do so on its behalf (or on behalf of any such
disclosed principal), (iv) it has obtained all authorizations of any governmental body required
in connection with this Agreement and the Transactions hereunder and such authorizations are in
full force and effect and (v) the execution, delivery and performance of this Agreement and the
Transactions hereunder will not violate any law, ordinance, charter, by-law or rule applicable
to it or any agreement by which it is bound or by which any of its assets are affected. On the
Purchase Date for any Transaction Buyer and Seller shall each be deemed to repeat all the
foregoing representations made by it.




	 	11.	 	Events of Default






In the event that (i) Seller fails to transfer or Buyer fails to purchase Purchased Securities
upon the applicable Purchase Date, (ii) Seller fails to repurchase or Buyer fails to transfer
Purchased Securities upon the applicable Repurchase Date, (iii) Seller or Buyer fails to comply
with Paragraph 4 hereof, (iv) Buyer fails, after one business day’s notice, to comply with
Paragraph 5 hereof, (v) an Act of Insolvency occurs with respect to Seller or Buyer, (vi) any
representation made by Seller or Buyer shall have been incorrect or untrue in any material
respect when made or repeated or deemed to have been made or repeated, or (vii) Seller or Buyer
shall admit to the other its inability to, or its intention not to, perform any of its
obligations hereunder (each an “Event of Default”):




	 	(a)	 	The nondefaulting party may, at its option (which option shall be deemed to have been
exercised immediately upon the occurrence of an Act of Insolvency), declare an Event of
Default to have occurred hereunder and, upon the exercise or deemed exercise of such
option, the Repurchase Date for each Transaction hereunder shall, if it has not already
occurred, be deemed immediately to occur (except that, in the event that the Purchase Date
for any Transaction has not yet occurred as of the date of such exercise or deemed
exercise, such Transaction shall be deemed immediately canceled). The nondefaulting party
shall (except upon the occurrence of an Act of Insolvency) give notice to the defaulting
party of the exercise of such option as promptly as practicable.






	 	(b)	 	In all Transactions in which the defaulting party is acting as Seller, if the
nondefaulting party exercises or is deemed to have exercised the option referred to in
subparagraph (a) of this Paragraph, (i) the defaulting party’s obligations in such
Transactions to repurchase all Purchased Securities, at the Repurchase Price therefor on
the Repurchase Date determined in accordance with subparagraph (a) of this Paragraph, shall
thereupon become immediately due and payable, (ii) all Income paid after such exercise or
deemed exercise shall be retained by the nondefaulting party and applied to the aggregate
unpaid Repurchase Prices and any other amounts owing by the defaulting party hereunder, and
(iii) the defaulting party shall immediately deliver to the nondefaulting party any
Purchased Securities subject to such Transactions then in the defaulting party’s possession
or control.






	 	(c)	 	In all Transactions in which the defaulting party is acting as Buyer, upon tender by
the nondefaulting party of payment of the aggregate Repurchase Prices for all such
Transactions, all right, title and interest in and entitlement to all Purchased Securities
subject to such Transactions shall be deemed transferred to the nondefaulting party, and
the defaulting party shall deliver all such Purchased Securities to the nondefaulting
party.






	 	(d)	 	If the nondefaulting party exercises or is deemed to have exercised the option referred
to in subparagraph (a) of this Paragraph, the nondefaulting party, without prior notice to
the defaulting party, may:






	 	(i)	 	as to Transactions in which the defaulting party is acting as Seller, (A)
immediately sell, in a recognized market (or otherwise in a commercially reasonable
manner) at such price or prices as the nondefaulting party may reasonably deem
satisfactory, any or all Purchased Securities subject to such Transactions and apply
the proceeds thereof to the aggregate unpaid Repurchase Prices and any other amounts
owing by the defaulting party hereunder or (B) in its sole discretion elect, in lieu of
selling all or a portion of such Purchased Securities, to give the defaulting party
credit for such Purchased Securities in an amount equal to the price therefor on such
date, obtained from a generally recognized source or the most recent closing bid
quotation from such a source, against the aggregate unpaid Repurchase Prices and any
other amounts owing by the defaulting party hereunder; and






	 	(ii)	 	as to Transactions in which the defaulting party is acting as Buyer, (A)
immediately purchase, in a recognized market (or otherwise in a commercially reasonable
manner) at such price or prices as the nondefaulting party may reasonably deem
satisfactory, securities (“Replacement Securities”) of the same class and amount as any
Purchased Securities that are not delivered by the defaulting party to the
nondefaulting party as required hereunder or (B) in its sole discretion elect, in lieu
of purchasing Replacement Securities, to be deemed to have purchased Replacement
Securities at the price therefor on such date, obtained from a generally recognized
source or the most recent closing offer quotation from such a source.






Unless otherwise provided in Annex I, the parties acknowledge and agree that (1) the
Securities subject to any Transaction hereunder are instruments traded in a recognized
market, (2) in the absence of a generally recognized source for prices or bid or offer
quotations for any Security, the nondefaulting party may establish the source therefor in
its sole discretion and (3) all prices, bids and offers shall be determined together with
accrued Income (except to the extent contrary to market practice with respect to the
relevant Securities).




	 	(e)	 	As to Transactions in which the defaulting party is acting as Buyer, the defaulting
party shall be liable to the nondefaulting party for any excess of the price paid (or
deemed paid) by the nondefaulting party for Replacement Securities over the Repurchase
Price for the Purchased Securities replaced thereby and for any amounts payable by the
defaulting party under Paragraph 5 hereof or otherwise hereunder.






	 	(f)	 	For purposes of this Paragraph 11, the Repurchase Price for each Transaction hereunder
in respect of which the defaulting party is acting as Buyer shall not increase above the
amount of such Repurchase Price for such Transaction determined as of the date of the
exercise or deemed exercise by the nondefaulting party of the option referred to in
subparagraph (a) of this Paragraph.






	 	(g)	 	The defaulting party shall be liable to the nondefaulting party for (i) the amount of
all reasonable legal or other expenses incurred by the nondefaulting party in connection
with or as a result of an Event of Default, (ii) damages in an amount equal to the cost
(including all fees, expenses and commissions) of entering into replacement transactions
and entering into or terminating hedge transactions in connection with or as a result of an
Event of Default, and (iii) any other loss, damage, cost or expense directly arising or
resulting from the occurrence of an Event of Default in respect of a Transaction.






	 	(h)	 	To the extent permitted by applicable law, the defaulting party shall be liable to the
nondefaulting party for interest on any amounts owing by the defaulting party hereunder,
from the date the defaulting party becomes liable for such amounts hereunder until such
amounts are (i) paid in full by the defaulting party or (ii) satisfied in full by the
exercise of the nondefaulting party’s rights hereunder. Interest on any sum payable by the
defaulting party to the nondefaulting party under this Paragraph 11 (h) shall be at a rate
equal to the greater of the Pricing Rate for the relevant Transaction or the Prime Rate.






	 	(i)	 	The nondefaulting party shall have, in addition to its rights hereunder, any rights
otherwise available to it under any other agreement or applicable law.






	 	12.	 	Single Agreement






Buyer and Seller 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 Buyer and Seller 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, (ii) that each of them shall be entitled to set off claims and apply property held by
them in respect of any Transaction against obligations owing to them in respect of any other
Transactions hereunder and (iii) that payments, deliveries and other transfers made by either of
them in respect of any Transaction shall be deemed to have been made in consideration of
payments, deliveries and other transfers in respect of any other Transactions hereunder, and the
obligations to make any such payments, deliveries and other transfers may be applied against
each other and netted.




	 	13.	 	Notices and Other Communications






Any and all notices, statements, demands or other communications hereunder may be given by a
party to the other by mail, facsimile, telegraph, messenger or otherwise to the address
specified in Annex II hereto, or so sent to such party at any other place specified in a notice
of change of address hereafter received by the other. All notices, demands and requests
hereunder may be made orally, to be confirmed promptly in writing, or by other communication as
specified in the preceding sentence.




	 	14.	 	Entire Agreement; Severability






This Agreement shall supersede any existing agreements between the parties containing general
terms and conditions for repurchase transactions. Each provision and agreement herein shall be
treated as separate and independent from any other provision or agreement herein and shall be
enforceable notwithstanding the unenforceability of any such other provision or agreement.




	 	15.	 	Non-assignability; Termination






	 	(a)	 	The rights and obligations of the parties under this Agreement and under any
Transaction shall not be assigned by either party without the prior written consent of the
other party, and any such assignment without the prior written consent of the other party
shall be null and void. Subject to the foregoing, this Agreement and any Transactions shall
be binding upon and shall inure to the benefit of the parties and their respective
successors and assigns. This Agreement may be terminated by either party upon giving
written notice to the other, except that this Agreement shall, notwithstanding such notice,
remain applicable to any Transactions then outstanding.






	 	(b)	 	Subparagraph (a) of this Paragraph 15 shall not preclude a party from assigning,
charging or otherwise dealing with all or any part of its interest in any sum payable to it
under Paragraph 11 hereof.






	 	16.	 	Governing Law






This Agreement shall be governed by the laws of the State of New York without giving effect to
the conflict of law principles thereof.




	 	17.	 	No Waivers, Etc.






No express or implied waiver of any Event of Default by either party shall constitute a waiver
of any other Event of Default and no exercise of any remedy hereunder by any party shall
constitute a waiver of its right to exercise any other remedy hereunder. No modification or
waiver of any provision of this Agreement and no consent by any party to a departure herefrom
shall be effective unless and until such shall be in writing and duly executed by both of the
parties hereto. Without limitation on any of the foregoing, the failure to give a notice
pursuant to Paragraph 4(a) or 4(b) hereof will not constitute a waiver of any right to do so at
a later date.




	 	18.	 	Use of Employee Plan Assets






	 	(a)	 	If assets of an employee benefit plan subject to any provision of the Employee
Retirement Income Security Act of 1974 (“ERISA”) are intended to be used by either party
hereto (the “Plan Party”) in a Transaction, the Plan Party shall so notify the other party
prior to the Transaction. The Plan Party shall represent in writing to the other party that
the Transaction does not constitute a prohibited transaction under ERISA or is otherwise
exempt therefrom, and the other party may proceed in reliance thereon but shall not be
required so to proceed.






	 	(b)	 	Subject to the last sentence of subparagraph (a) of this Paragraph, any such
Transaction shall proceed only if Seller furnishes or has furnished to Buyer its most
recent available audited statement of its financial condition and its most recent
subsequent unaudited statement of its financial condition.






	 	(c)	 	By entering into a Transaction pursuant to this Paragraph, Seller shall be deemed (i)
to represent to Buyer that since the date of Seller’s latest such financial statements,
there has been no material adverse change in Seller’s financial condition which Seller has
not disclosed to Buyer, and (ii) to agree to provide Buyer with future audited and
unaudited statements of its financial condition as they are issued, so long as it is a
Seller in any outstanding Transaction involving a Plan Party.






	 	19.	 	Intent






	 	(a)	 	The parties recognize that each Transaction is a “repurchase agreement” as that term is
defined in Section 101 of Title 11 of the United States Code, as amended (except insofar as
the type of Securities subject to such Transaction or the term of such Transaction would
render such definition inapplicable), and a “securities contract” as that term is defined
in Section 741 of Title 11 of the United States Code, as amended (except insofar as the
type of assets subject to such Transaction would render such definition inapplicable).






	 	(b)	 	It is understood that either party’s right to liquidate Securities delivered to it in
connection with Transactions hereunder or to exercise any other remedies pursuant to
Paragraph 11 hereof is a contractual right to liquidate such Transaction as described in
Sections 555 and 559 of Title 11 of the United States Code, as amended.






	 	(c)	 	The parties agree and acknowledge that if a party hereto is an “insured depository
institution,” as such term is defined in the Federal Deposit Insurance Act, as amended
(“FDIA”), then each Transaction hereunder is a “qualified financial contract,” as that term
is defined in FDIA and any rules, orders or policy statements thereunder (except insofar as
the type of assets subject to such Transaction would render such definition inapplicable).






	 	(d)	 	It is understood that this Agreement constitutes a “netting contract” as defined in and
subject to Title IV of the Federal Deposit Insurance Corporation Improvement Act of 1991
(“FDICIA”) and each payment entitlement and payment obligation under any Transaction
hereunder shall constitute a “covered contractual payment entitlement” or “covered
contractual payment obligation”, respectively, as defined in and subject to FDICIA (except
insofar as one or both of the parties is not a “financial institution” as that term is
defined In FDICIA).






	 	20.	 	Disclosure Relating to Certain Federal Protections






The parties acknowledge that they have been advised that:




	 	(a)	 	in the case of Transactions in which one of the parties is a broker or dealer
registered with the Securities and Exchange Commission (“SEC”) under Section 15 of the
Securities Exchange Act of 1934 (“1934 Act”), the Securities Investor Protection
Corporation has taken the position that the provisions of the Securities Investor
Protection Act of 1970 (“SIPA”) do not protect the other party with respect to any
Transaction hereunder;






	 	(b)	 	in the case of Transactions in which one of the parties is a government securities
broker or a government securities dealer registered with the SEC under Section 15C of the
1934 Act, SIPA will not provide protection to the other party with respect to any
Transaction hereunder; and






	 	(c)	 	in the case of Transactions in which one of the parties is a financial institution,
funds held by the financial institution pursuant to a Transaction hereunder are not a
deposit and therefore are not insured by the Federal Deposit Insurance Corporation or the
National Credit Union Share Insurance Fund, as applicable.




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BEAR STEARNS MORTGAGE


CAPITAL CORPORATION, as Buyer



By: Timothy Green


Title: Senior Vice President


Date: November 28, 2005



ENCORE CREDIT CORP., as


Seller jointly and severally


with the other Sellers



By: William E. Moffatt


Title: Treasurer


Date: November 28, 2005



BRAVO CREDIT CORPORATION, as





Seller jointly and severally


with the other Sellers



By: William E. Moffatt


Title: Treasurer


Date: November 28, 2005



CONQUISTAMERICA, INC. as





Seller jointly and severally


with the other Sellers



By: Roque A. Santi


Title: Chief Financial Officer


Date: November 28, 2005



ECC CAPITAL CORPORATION, as





Seller jointly and severally


with the other Sellers



By: William E. Moffatt


Title: Treasurer


Date: November 28, 2005




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