Document:

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                                                                 Exhibit 10.31.9

                             AMENDMENT NUMBER TWELVE
                                     to the
             Amended and Restated Master Loan and Security Agreement
                           Dated as of March 27, 2000
                                      among
                     HANOVER CAPITAL MORTGAGE HOLDINGS, INC.
                          HANOVER CAPITAL PARTNERS LTD.
                                       and
                   GREENWICH CAPITAL FINANCIAL PRODUCTS, INC.

          This AMENDMENT NUMBER TWELVE is made this 31st day of January, 2006,
among HANOVER CAPITAL MORTGAGE HOLDINGS, INC. and HANOVER CAPITAL PARTNERS LTD.
each having an address at 200 Metroplex Drive, Suite 100, Edison, New Jersey
08817 (each, a "Borrower" and collectively, "the Borrowers") and GREENWICH
CAPITAL FINANCIAL PRODUCTS, INC., having an address at 600 Steamboat Road,
Greenwich, Connecticut 06830 (the "Lender"), to the Amended and Restated Master
Loan and Security Agreement, dated as of March 27, 2000, by and between the
Borrowers and the Lender, as amended (the "Agreement"). Capitalized terms used
but not otherwise defined herein shall have the meanings assigned to such terms
in the Agreement.

                                    RECITALS

          WHEREAS, the Borrowers have requested and the Lender has agreed to
amend the Agreement to remove Hanover Capital Partners Ltd. as a Borrower;

          WHEREAS, the Borrowers and the Lender have agreed to amend the
Agreement as set forth herein.

          NOW THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, and of the mutual covenants herein
contained, the parties hereto hereby agree as follows:

     SECTION 1. Effective as of January 31, 2006, the first paragraph of the
Agreement is hereby amended to read in its entirety as follows:

          AMENDED AND RESTATED MASTER LOAN AND SECURITY AGREEMENT, dated as of
     March 27, 2000, between HANOVER CAPITAL MORTGAGE HOLDINGS, INC. ("Hanover
     Capital Holdings"), a Maryland corporation, (the "Borrower"), and GREENWICH
     CAPITAL FINANCIAL PRODUCTS, INC., a Delaware corporation (the "Lender").

     SECTION 2. Effective as of January 31, 2006, the first paragraph of Exhibit
D-1, Exhibit D-2, Exhibit D-3 and Exhibit D-4 is hereby amended to read in its
entirety as follows:

          Reference is made to the Amended and Restated Master Loan and Security
     Agreement, dated as of March 27, 2000 (the "Loan Agreement";

<PAGE>

                                       -2-

     capitalized terms used but not otherwise defined herein shall have the
     meaning given them in the Loan Agreement), between Hanover Capital Mortgage
     Holdings, Inc. (the "Borrower") and Greenwich Capital Financial Products,
     Inc. (the "Lender").

     SECTION 3. Effective as of January 31, 2006, the word "Borrowers" shall be
replaced by the word, "Borrower" throughout the Agreement.

     SECTION 4. No Breach. The merger of Hanover Capital Partners, Ltd. and
Hanover Capital Partners 2, Inc. with and into Hanover Trade, Inc. as a result
of which Hanover Trade, Inc. is the surviving entity with the corporate name
"Hanover Capital Partners 2, Ltd." will not constitute a Change of Control as
defined by the Agreement, a breach of the representations and warranties of any
Borrower under Section 6 of the Agreement, or a breach of the covenants of any
Borrower under Section 7 of the Agreement. The parties hereto acknowledge and
agree that subject to the provisions of this Amendment Number Twelve, the
provisions of the Agreement remain in full force and effect and that the
execution of this Amendment Number Twelve does not operate as a waiver by the
Lender of any of its rights, powers or privileges under either the Agreement or
under any of the Loan Documents.

     SECTION 5. Effectiveness. This Amendment Number Twelve shall be effective
upon the Lender's receipt of a new Note, executed by Hanover Capital Mortgage
Holdings, Inc. in the form attached hereto as Exhibit A, to replace the existing
Note by Hanover Capital Mortgage Holdings, Inc. and Hanover Capital Partners
Ltd.

     SECTION 6. Defined Terms. Any terms capitalized but not otherwise defined
herein shall have the respective meanings set forth in the Agreement.

     SECTION 7. Fees and Expenses. The Borrower agrees to pay to the Lender all
fees and out of pocket expenses incurred by the Lender in connection with this
Amendment Number Twelve (including all reasonable fees and out of pocket costs
and expenses of the Lender's legal counsel incurred in connection with this
Amendment Number Twelve), in accordance with Section 11.03 of the Agreement

     SECTION 8. Limited Effect. Except as amended hereby, the Agreement shall
continue in full force and effect in accordance with its terms. Reference to
this Amendment Number Twelve need not be made in the Agreement or any other
instrument or document executed in connection therewith, or in any certificate,
letter or communication issued or made pursuant to, or with respect to, the
Agreement, any reference in any of such items to the Agreement being sufficient
to refer to the Agreement as amended hereby.

     SECTION 9. Representations. The Borrowers hereby represents to the Lender
that as of the date hereof, the Borrowers are in full compliance with all of the
terms and conditions of the Agreement and no Default or Event of Default has
occurred and is continuing under the Agreement.

<PAGE>

                                       -3-

     SECTION 10. Governing Law. This Amendment Number Twelve shall be construed
in accordance with the laws of the State of New York and the obligations,
rights, and remedies of the parties hereunder shall be determined in accordance
with such laws without regard to conflict of laws doctrine applied in such state
(other than Sections 5-1401 and 5-1402 of the New York General Obligations Law).

     SECTION 9. Counterparts. This Amendment Number Twelve may be executed by
each of the parties hereto on any number of separate counterparts, each of which
shall be an original and all of which taken together shall constitute one and
the same instrument.

                [REMAINDER OF THIS PAGE LEFT INTENTIONALLY BLANK]

<PAGE>

          IN WITNESS WHEREOF, the Borrowers and the Lender have caused this
Amendment Number Twelve to be executed and delivered by their duly authorized
officers as of the day and year first above written.

                                        HANOVER CAPITAL MORTGAGE
                                        HOLDINGS, INC.
                                        (Borrower)

                                        By: /s/ Irma N Tavares
                                            ------------------------------------
                                        Name: Irma N Tavares
                                        Title: COO

                                        HANOVER CAPITAL PARTNERS LTD.
                                        (Borrower)

                                        By: /s/ Joyce Mizerak
                                            ------------------------------------
                                        Name: Joyce Mizerak
                                        Title: President

                                        GREENWICH CAPITAL FINANCIAL
                                        PRODUCTS, INC.
                                        (Lender)

                                        By: /s/ Anthony Palmisano
                                            ------------------------------------
                                        Name: Anthony Palmisano
                                        Title: Managing Director

<PAGE>

                                    EXHIBIT A

                            [FORM OF PROMISSORY NOTE]

$20,000,000                                               Dated January 31, 2006
                                                          New York, New York

          FOR VALUE RECEIVED, HANOVER CAPITAL MORTGAGE HOLDINGS, INC., a
Maryland corporation (the "Borrower"), hereby promises to pay to the order of
GREENWICH CAPITAL FINANCIAL PRODUCTS, INC. a Delaware corporation (the
"Lender"), at the principal office of the Lender at 600 Steamboat Road,
Greenwich, Connecticut 06830, in lawful money of the United States, and in
immediately available funds, the principal sum of TWENTY MILLION DOLLARS
($20,000,000) (or such lesser amount as shall equal the aggregate unpaid
principal amount of the Advances made by the Lender to the Borrower under the
Loan Agreement as defined below), on the dates and in the principal amounts
provided in the Loan Agreement, and to pay interest on the unpaid principal
amount of each such Advance, at such office, in like money and funds, for the
period commencing on the date of such Advance until such Advance shall be paid
in full, at the rates per annum and on the dates provided in the Loan Agreement.

          The date, amount and interest rate of each Advance made by the Lender
to the Borrower, and each payment made on account of the principal and interest
thereof, shall be recorded by the Lender on its books and, prior to any transfer
of this Note, endorsed by the Lender on the schedule attached hereto or any
continuation thereof; provided, that the failure of the Lender to make any such
recordation or endorsement shall not affect the obligations of the Borrower to
make a payment when due of any amount owing under the Loan Agreement or
hereunder in respect of the Advances made by the Lender.

*    This Note is the Note referred to in the Amended and Restated Master Loan
     and Security Agreement dated as of March 27, 2000 (as amended, supplemented
     or otherwise modified and in effect from time to time, the "Loan
     Agreement") between the Borrower and the Lender, and evidences Advances
     made by the Lender thereunder. Terms used but not defined in this Note have
     the respective meanings assigned to them in the Loan Agreement.

          The Borrower agrees to pay all the Lender's costs of collection and
enforcement (including attorneys' fees and disbursements of Lender's counsel) in
respect of this Note when incurred, including, without limitation, attorneys'
fees through appellate proceedings.

          Notwithstanding the pledge of the Collateral, the Borrower hereby
acknowledges, admits and agrees that the Borrower's obligations under this Note
are recourse obligations of the Borrowers to which the Borrowers pledge their
full faith and credit.

<PAGE>

          The Borrower, and any indorsers hereof, (a) severally waive diligence,
presentment, protest and demand and also notice of protest, demand, dishonor and
nonpayments of this Note, (b) expressly agree that this Note, or any payment
hereunder, may be extended from time to time, and consent to the acceptance of
further Collateral, the release of any Collateral for this Note, the release of
any party primarily or secondarily liable hereon, and (c) expressly agree that
it will not be necessary for the Lender, in order to enforce payment of this
Note, to first institute or exhaust the Lender's remedies against the Borrower
or any other party liable hereon or against any Collateral for this Note. No
extension of time for the payment of this Note, or any installment hereof, made
by agreement by the Lender with any person now or hereafter liable for the
payment of this Note, shall affect the liability under this Note of the
Borrower, even if the Borrower are not a party to such agreement; provided,
however, that the Lender and the Borrower, by written agreement between them,
may affect the liability of the Borrower.

          Any reference herein to the Lender shall be deemed to include and
apply to every subsequent holder of this Note. Reference is made to the Loan
Agreement for provisions concerning optional and mandatory prepayments,
Collateral, acceleration and other material terms affecting this Note.

          The Borrower hereby acknowledges and agrees that it will be liable to
the Lender for all representations, warranties, covenants and liabilities of the
Borrower hereunder.

          Any enforcement action relating to this Note may be brought by motion
for summary judgment in lieu of a complaint pursuant to Section 3213 of the New
York Civil Practice Law and Rules.

          THIS NOTE SHALL BE GOVERNED BY AND CONSTRUED UNDER THE LAWS OF THE
STATE OF NEW YORK (WITHOUT REFERENCE TO CHOICE OF LAW DOCTRINE BUT WITH
REFERENCE TO SECTION 5-1401 OF THE NEW YORK GENERAL OBLIGATIONS LAW, WHICH BY
ITS TERMS APPLIES TO THIS NOTE) WHOSE LAWS THE BORROWER EXPRESSLY ELECT TO APPLY
TO THIS NOTE. THE BORROWER AGREES THAT ANY ACTION OR PROCEEDING BROUGHT TO
ENFORCE OR ARISING OUT OF THIS NOTE MAY BE COMMENCED IN THE SUPREME COURT OF THE
STATE OF NEW YORK, BOROUGH OF MANHATTAN, OR IN THE DISTRICT COURT OF THE UNITED
STATES FOR THE SOUTHERN DISTRICT OF NEW YORK. THE BORROWER HEREBY SUBMITS TO NEW
YORK JURISDICTION WITH RESPECT TO ANY ACTION BROUGHT WITH RESPECT TO THIS NOTE
AND WAIVES ANY RIGHT WITH RESPECT TO THE DOCTRINE OF FORUM NON CONVENIENS WITH
RESPECT TO SUCH TRANSACTIONS.

                                        HANOVER CAPITAL MORTGAGE HOLDINGS, INC.

                                        By:
                                            ------------------------------------
                                        Name:
                                              ----------------------------------
                                        Title:
                                               ---------------------------------<PAGE>
                                                                Exhibit 10.36.18

                            INDEMNIFICATION AGREEMENT

THIS INDEMNIFICATION AGREEMENT is effective as of November 28, 2005 (this
"Agreement") by and between Hanover Capital Mortgage Holdings, Inc., a Maryland
corporation (the "Company"), and Suzette Nanovic Berrios, Vice President and
General Counsel of the Company (together with such person's legal
representatives or other successors, "Indemnitee").

WHEREAS, in order to induce Indemnitee to serve, or continue to serve, as Vice
President and General Counsel of the Company or to accept, or continue to
accept, the duties, responsibilities and burdens associated with such service,
the Company desires, and the board of directors of the Company has resolved to
provide the Indemnitee with the indemnification arrangements set forth herein;
and

WHEREAS, Indemnitee is willing to serve or continue to serve as Vice President
and General Counsel of the Company on the terms set forth herein;

NOW, THEREFORE, in consideration of the foregoing premises and the mutual
covenants and agreements contained herein, and for good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the
parties hereto agree as follows:

1.   DEFINITIONS; INTERPRETIVE PRINCIPLES.

     (a)  Definitions

          For purposes of this Agreement:

          "Affiliate" of any particular Person means any other Person
          controlling, controlled by or under common control with such
          particular Person, where "control" means the possession, directly or
          indirectly, of the power to direct the management and policies of a
          Person whether through the ownership of voting securities, contract or
          otherwise.

          "Company Entity" shall mean the Company or any Subsidiary of the
          Company.

          "Corporate Status" describes the status of a Person who is or was a
          director, officer, partner, employee, trustee, agent or fiduciary of
          any Company Entity or of any other corporation, limited liability
          company, partnership, joint venture, trust, employee benefit plan or
          other enterprise which such Person is or was serving at the request of
          any Company Entity.

          "Disinterested Director" means a member of the board of directors of
          the Company who is not and was not a party to the Proceeding in
          respect of which indemnification is sought by Indemnitee.

          "Expenses" shall include all attorneys' fees, retainers, court costs,
          transcript costs, fees of experts, witness fees, travel expenses,
          duplicating costs, printing and binding costs, telephone charges,
          postage, delivery service fees, and all other disbursements or
          expenses of the types customarily incurred in connection with
          prosecuting, defending, preparing to prosecute or defend,
          investigating, participating or being or preparing to be a witness in
          any Proceeding or other proceeding of the type described in the

Indemnification Agreement - S. Berrios
Page 1 of 13

<PAGE>

          definition of "Proceeding" set forth below.

          "Including" means including but not limited to.

          "Independent Counsel" means a law firm, or a member of a law firm,
          that is experienced in matters of corporation law and neither
          presently is, nor in the past three years has been, retained to
          represent: (i) any Company Entity or Indemnitee in any matter (other
          than with respect to matters concerning Indemnitee under this
          Agreement) or (ii) any other party to the Proceeding giving rise to a
          claim for indemnification hereunder. Notwithstanding the foregoing,
          the term "Independent Counsel" shall not include any Person who, under
          the applicable standards of professional conduct then prevailing,
          would have a conflict of interest in representing any Company Entity
          or Indemnitee in an action to determine Indemnitee's rights under this
          Agreement.

          "Losses" means judgments, penalties, liabilities, losses, claims,
          damages, fines and amounts, including amounts paid in settlement.

          "Person" shall mean any person or entity of any nature whatsoever,
          specifically including an individual, a firm, a company, a
          corporation, a limited liability company, a partnership, a trust or
          other entity.

          "Proceeding" includes any actual, threatened, pending or completed
          action, suit, litigation, claim, arbitration, mediation, alternate
          dispute resolution mechanism, investigation, inquiry, administrative
          hearing or any other actual, threatened, pending or completed
          proceeding arising on or after the date hereof, whether brought by or
          in the right of any Company Entity or otherwise and whether civil,
          criminal, administrative or investigative, in which Indemnitee was, is
          or will be involved as a party or otherwise, by reason of the fact
          that he is or was a director, officer, employee, trustee, agent,
          attorney-in-fact or fiduciary of any Company Entity at any time on or
          after the date hereof, or is or was serving at the request of any
          Company Entity as a director, officer, partner, employee, trustee,
          agent, attorney-in-fact or fiduciary of another corporation,
          partnership, joint venture, trust or other enterprise, or by reason of
          any action taken by him or of any inaction on his part, on or after
          the date hereof, while acting as director, officer, partner, employee,
          trustee, agent, attorney-in-fact or fiduciary of any Company Entity,
          or while serving at the request of any Company Entity as a director,
          officer, partner, employee, trustee, agent, attorney-in-fact or
          fiduciary of another corporation, partnership, joint venture, trust or
          other enterprise, in each case whether or not he is acting or serving
          in any such capacity at the time any Expense, Loss or other amount for
          which indemnification can be provided under this Agreement is incurred
          or imposed.

          "Subsidiary" shall mean with respect to any Person, any corporation or
          other entity of which a majority of the voting power of the voting
          equity securities or equity interest is owned, directly or indirectly,
          by that Person.

     (b)  Interpretive Principles

          For purposes of this Agreement, (i) the terms defined in this Section
          include the plural as well as the singular, (ii) the use of any gender
          herein shall be deemed to include the other genders; and (iii)
          references herein to Sections without reference to a document are to
          designated Sections in this Agreement.

Indemnification Agreement - S. Berrios
Page 2 of 13

<PAGE>

2.   SCOPE OF INDEMNIFICATION.

     The obligations of the Company to indemnify Indemnitee in the manner set
     forth in this Agreement shall continue in full force and effect, consistent
     with the terms of Section 10, notwithstanding any termination or
     resignation of the Indemnitee.

3.   INDEMNITY.

     (a)  If an Indemnitee was, is, or is threatened to be made a party to or
          participant in any Proceeding whether such Proceeding is by or in the
          right of any Company Entity, any third party or any other Person, the
          Company hereby agrees to hold harmless and indemnify the Indemnitee
          from and against any and all Expenses and Losses incurred by
          Indemnitee or incurred on his behalf to the fullest extent authorized
          or permitted by applicable law, by the Charter of the Company and by
          the By-Laws of the Company as the foregoing may be amended from time
          to time, and including any and all Expenses and Losses arising out of
          or relating to the actual or alleged acts, omissions, negligence or
          active or passive wrongdoing of Indemnitee. The only limitation that
          shall exist upon the indemnification obligations of the Company
          pursuant to this Agreement is that the Company shall not be obligated
          to make any indemnity-related payment to Indemnitee that is finally
          determined (pursuant to the procedures and subject to the presumptions
          set forth in Sections 7 and 8) to be unlawful under Maryland law.

     (b)  Notwithstanding any other provision of this Agreement to the contrary,
          to the extent that Indemnitee is a party to and is successful, on the
          merits or otherwise, in any Proceeding, he shall be indemnified
          pursuant to subsection (a) above to the maximum extent permitted by
          law. However, if (i) Indemnitee is not wholly successful in a
          Proceeding but is successful, on the merits or otherwise, as to one or
          more but less than all claims, issues or matters in such Proceeding,
          and (ii) it is determined that it is unlawful for Indemnitee to be
          indemnified with respect to such unsuccessful claims, issues or
          matters, in such instance the Company shall indemnify Indemnitee
          against all Expenses and Losses incurred by Indemnitee, or incurred on
          his behalf in connection with each successfully resolved claim, issue
          or matter. For purposes of this Section and without limitation, the
          termination of any claim, issue or matter in a Proceeding by
          dismissal, with or without prejudice, shall be deemed to be successful
          on the merits or otherwise as to such claim, issue or matter.

4.   CONTRIBUTION IN THE EVENT OF JOINT LIABILITY.

     (a)  Irrespective of whether the indemnification rights granted pursuant to
          Section 3 are available in any given instance, it is agreed by the
          parties that with respect to any Proceeding in which any Company
          Entity is jointly liable with Indemnitee (or would be liable if joined
          in such Proceeding), the Company shall pay, in the first instance, the
          entire amount of any and all Expenses and Losses relating to or
          incurred in connection with such Proceeding, without requiring
          Indemnitee to contribute to such payment, and the Company hereby
          waives and relinquishes any right of contribution it may have against
          Indemnitee. The Company shall not enter into any settlement of any
          Proceeding in which any Company Entity is jointly liable with
          Indemnitee (or would be liable if joined in such Proceeding) unless
          such settlement provides for a full and final release of all claims
          asserted against Indemnitee.

     (b)  Without diminishing or impairing the obligations of the Company set
          forth in subsection (a) above, if,

Indemnification Agreement - S. Berrios
Page 3 of 13

<PAGE>

          for any reason, Indemnitee should elect or be required by any relevant
          judicial or administrative authority to pay all or any portion of any
          Expenses and Losses relating to or incurred in connection with any
          Proceeding in which any Company Entity is jointly liable with
          Indemnitee (or would be liable if joined in such Proceeding), the
          Company shall contribute to the amount of Expenses and Losses incurred
          and paid or payable by Indemnitee. The contribution by the Company
          shall be in an amount proportional to (i) on the one hand, the
          relative benefits received or enjoyed from the transaction to which
          the Proceeding relates by any Company Entity and all directors,
          officers, partners, employees, trustees, agents, attorneys-in-fact or
          fiduciaries of any Company Entity (other than Indemnitee) who are
          jointly liable with Indemnitee (or would be liable if joined in such
          Proceeding), and (ii) the relative benefits received or enjoyed from
          the transaction to which the Proceeding relates by Indemnitee,
          provided, however, that such proportional calculation, to the extent
          necessary to conform to applicable law, may be further adjusted: (A)
          by reference to the relative fault of any Company Entity and all
          directors, officers, partners, employees, trustees, agents,
          attorneys-in-fact or fiduciaries of any Company Entity (other than
          Indemnitee) who are jointly liable with Indemnitee (or would be if
          joined in such Proceeding) on the one hand;, and Indemnitee, on the
          other hand, in connection with the events that resulted in such
          Expenses and Losses; and/or (B) by any other equitable considerations
          which the law may require to be considered. The relative fault of any
          Company Entity and all directors, officers, partners, employees,
          trustees, agents, attorneys-in-fact or fiduciaries of any Company
          Entity (other than Indemnitee) who are jointly liable with him (or
          would be liable if joined in such Proceeding) on the one hand, and
          Indemnitee, on the other hand, shall be determined by taking into
          account, among other factors, the degree to which their respective
          actions were motivated by intent to gain personal profit or advantage,
          the degree to which their liability is primary or secondary and the
          degree to which their conduct is active or passive.

     (c)  The Company hereby agrees to fully indemnify and hold Indemnitee
          harmless from and against any and all claims of contribution which may
          be brought by any director, officer, employee, trustee, agent,
          attorney-in-fact or fiduciary of any Company Entity who may be jointly
          liable with Indemnitee in connection with any given Proceeding.

5. INDEMNIFICATION FOR EXPENSES INCURRED AS A WITNESS.

     Notwithstanding any other provision of this Agreement to the contrary, to
     the extent that Indemnitee is, by reason of his Corporate Status, a witness
     in any Proceeding to which Indemnitee is not a party, the Company shall
     indemnify Indemnitee for and against all Expenses actually incurred by
     Indemnitee or incurred on his behalf in connection therewith.

6. ADVANCEMENT OF EXPENSES.

     Notwithstanding any other provision of this Agreement to the contrary, the
     Company shall advance or directly pay all Expenses incurred by or on behalf
     of Indemnitee in connection with any Proceeding, within ten days after the
     receipt by the Company of any statement from Indemnitee requesting such
     advances or payments from time to time, whether prior to or after final
     disposition of such Proceeding. Such statement shall reasonably evidence
     the Expenses incurred by, or on behalf of, or charged to Indemnitee. In
     connection herewith, as a condition to any advancement or direct payment of
     any Expenses incurred by or on behalf of Indemnitee in connection with any
     Proceeding, Indemnitee hereby agrees and undertakes to repay any Expenses
     advanced or paid hereunder, and Indemnitee shall, at the request of the
     Company,

Indemnification Agreement - S. Berrios
Page 4 of 13

<PAGE>

     execute one or more agreements and undertakings in reasonable form, in
     favor of the Company or any insurer or other Person reasonably selected by
     the Company, to repay any Expenses advanced or paid if ultimately it is
     determined that Indemnitee is not entitled to be indemnified or reimbursed
     for such Expenses in any given instance, in accordance with applicable law
     and the Charter and By-laws of the Company, as the foregoing may be amended
     from time to time. The foregoing undertaking to repay such Expenses by
     Indemnitee shall be unsecured and interest-free. Notwithstanding the
     foregoing, the obligation of the Company to advance Expenses pursuant to
     this Section 6 shall be subject to the condition that if, when and to the
     extent that the Company reasonably determines that Indemnitee would not be
     permitted to be indemnified under applicable law (subject to the terms and
     conditions of Section 7), the Company shall no longer be obligated to
     advance expenses to Indemnitee and shall be entitled to reimbursement
     within 30 days of such determination by Indemnitee for all such amounts
     theretofore paid; provided, however, that if Indemnitee has commenced or
     thereafter commences legal proceedings in a court of competent jurisdiction
     to secure a determination that he should be indemnified under applicable
     law, any determination made by the Company that Indemnitee is not entitled
     to indemnification under applicable law in a given instance shall not be
     binding, and [the Company shall once again be required to advance
     expenses,] and Indemnitee shall not be required to reimburse the Company
     for any advance or payment of Expenses until a final judicial determination
     is made with respect thereto (as to which all rights of appeal therefrom
     have been exhausted or have lapsed).

7.   PROCEDURES AND PRESUMPTIONS FOR DETERMINATION OF ENTITLEMENT TO
     INDEMNIFICATION.

     It is the intent of this Agreement to secure for Indemnitee rights of
     indemnity that are as favorable and as broad as permitted under the law and
     public policy of Maryland. Accordingly, the parties hereby agree that the
     following procedures and presumptions shall apply if any question or
     dispute arises as to whether Indemnitee is entitled to indemnification
     under this Agreement.

     (a)  To obtain indemnification under this Agreement, Indemnitee shall
          submit to the Company a written request, including therein or
          therewith such documentation and information as is reasonably
          available to Indemnitee and as may be reasonably necessary to enable
          the Company to determine whether and to what extent Indemnitee is
          entitled to indemnification. The Secretary of the Company shall,
          promptly upon receipt of such a request for indemnification advise the
          Company's board of directors of such request in writing. Indemnitee's
          failure to strictly comply with the procedural requirements set forth
          in this Section, however, shall not relieve the Company of any
          obligation it may have to indemnify hereunder and shall not alter or
          waive any presumptions for determination of entitlement to
          indemnification contained herein unless, and to the extent, the
          Company is prejudiced thereby.

     (b)  Upon each submission of a written request by Indemnitee for
          indemnification pursuant to subsection (a) above, a determination with
          respect to Indemnitee's entitlement thereto shall be made in
          accordance with one of the following methods, the selection of which
          method shall be at Indemnitee's discretion: (i) by a majority vote of
          the Disinterested Directors even if such Disinterested Directors
          constitute less than a quorum; or (ii) by Independent Counsel in a
          written opinion pursuant to the procedures and selection processes set
          forth in subsection (c) below.

     (c)  If Indemnitee elects for the determination of entitlement to
          indemnification to be made by Independent

Indemnification Agreement - S. Berrios
Page 5 of 13

<PAGE>

          Counsel pursuant to subsection (b) above, the Independent Counsel
          shall be selected as provided in this subsection (c). The Independent
          Counsel shall be selected by Indemnitee (unless he requests that the
          selection be made by the Company's board of directors) with the
          approval of the Company (which approval may not be unreasonably
          withheld). The Company shall pay any and all Expenses of such
          Independent Counsel relating to its performance of services in
          connection herewith, and the Company shall pay all Expenses incident
          to the procedures contained in this subsection (c) irrespective of the
          manner in which such Independent Counsel was selected or appointed.

     (d)  In making a determination with respect to Indemnitee's entitlement to
          indemnification hereunder, the Person(s) making such determination
          shall presume that Indemnitee is entitled to indemnification under
          this Agreement if he has submitted a request for indemnification in
          accordance with subsection (a) above. Anyone seeking to overcome this
          presumption shall have the burden of proof and the burden of
          persuasion, by clear and convincing evidence. In addition, if the
          Person(s) making a determination pursuant to subsection (b) above
          shall determine that Indemnitee is not entitled to indemnification
          hereunder, such determination shall not create a presumption against
          Indemnitee's entitlement to indemnification in any later action, suit
          or proceeding initiated by Indemnitee to enforce his rights under this
          Agreement.

     (e)  Indemnitee shall be presumed to have acted in good faith if his action
          is based on the records or books of account of any Company Entity or
          any other Person, including financial statements, or on information
          supplied to Indemnitee by the officers of any Company Entity or such
          other Person, in the course of their duties or on the advice of legal
          counsel for any Company Entity, or on information or records given or
          reports made to any Company Entity by an independent certified public
          accountant, by a financial advisor or by an appraiser or other expert
          selected by any Company Entity. In addition, the knowledge and/or
          actions, or failure to act, of any director, officer, partner, agent,
          trustee or employee of any Company Entity or any other Person, shall
          not be imputed to Indemnitee for purposes of determining his right to
          indemnification under this Agreement. Irrespective of whether the
          foregoing provisions of this subsection (e) are satisfied, it shall be
          presumed in any event that each Indemnitee has at all times acted in
          good faith and in a manner he reasonably believed to be in or not
          opposed to the best interests of any Company Entity. Anyone seeking to
          overcome this presumption shall have the burden of proof and the
          burden of persuasion, by clear and convincing evidence.

     (f)  The Company acknowledges that a settlement or other disposition of a
          Proceeding short of final judgment may be desirable if it permits a
          party to avoid expense, delay, distraction, disruption and
          uncertainty. If any Proceeding to which Indemnitee is a party is
          resolved in any manner other than by adverse judgment against
          Indemnitee (including settlement of such Proceeding with or without
          payment of money or other consideration) it shall be presumed that
          Indemnitee has been successful on the merits or otherwise in such
          Proceeding. Anyone seeking to overcome this presumption shall have the
          burden of proof and the burden of persuasion by clear and convincing
          evidence.

     (g)  If the Person(s) empowered or selected under subsection (b) above to
          determine whether Indemnitee is entitled to indemnification shall not
          have made a determination within 30 days after receipt by the Company
          of the request therefore, the requisite determination of entitlement
          to indemnification shall be deemed to have been made in favor of the
          Indemnitee, and he shall be entitled to such indemnification, absent
          (i) an intentional misstatement by Indemnitee of a material fact, or
          an intentional omission of a material fact necessary to make
          Indemnitee's statement not materially misleading, in connection with
          the

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<PAGE>

          request for indemnification; or (ii) a prohibition of such
          indemnification under applicable law; provided, however, that such
          30-day period may be extended for a reasonable time, not to exceed an
          additional 15 days, if the Person(s) making such determination
          reasonably and in good faith requires such additional time to complete
          the obtaining or evaluation of documentation and/or information
          relating thereto.

     (h)  Indemnitee shall reasonably cooperate with the Person(s) making the
          determination regarding his entitlement to indemnification, including
          providing to such Person(s) upon reasonable advance request any
          documentation or information which is not privileged or otherwise
          protected from disclosure and which is reasonably available to
          Indemnitee and reasonably necessary to such determination. Any
          Independent Counsel or member of the board of directors of the Company
          shall act reasonably and in good faith in making a determination of
          Indemnitee's entitlement to indemnification hereunder. Any Expenses
          incurred by Indemnitee in so cooperating with the Person(s) making
          such determination shall be borne by the Company (irrespective of the
          determination as to Indemnitee's entitlement to indemnification), and
          the Company hereby agrees to indemnify and hold harmless Indemnitee
          therefrom.

8.   REMEDIES.

     (a)  If: (i) a determination is made pursuant to Section 7 that Indemnitee
          is not entitled to indemnification under this Agreement; (ii)
          advancement of Expenses is not timely made pursuant to Section 6;
          (iii) contribution is not made pursuant to Section 4; (iv) no
          determination of entitlement to indemnification is made pursuant to
          Section 7 within 90 days after receipt by the Company of the request
          for indemnification; (v) payment of indemnification is not made within
          ten days after a determination has been made that Indemnitee is
          entitled to indemnification or such determination is deemed to have
          been made pursuant to Section 7; or (vii) the Company has not complied
          with any other term of this Agreement intended for the benefit of
          Indemnitee, then in any such event, Indemnitee shall be entitled to an
          adjudication of the foregoing in an appropriate court in Maryland, or
          in any other court of competent jurisdiction. The Company shall not
          oppose Indemnitee's right to seek any such adjudication.

     (b)  If a determination shall have been made pursuant to Section 7 that
          Indemnitee is not entitled to indemnification, any judicial proceeding
          commenced pursuant to this Section 8 shall be conducted in all
          respects as a de novo trial, on the merits, and Indemnitee shall not
          be prejudiced by reason of that adverse determination.

     (c)  If a determination shall have been made pursuant to Section 7 that
          Indemnitee is entitled to indemnification, the Company shall be bound
          by such determination in any judicial proceeding commenced pursuant to
          this Section 8, absent a prohibition of such indemnification under
          applicable law.

     (d)  If Indemnitee, pursuant to this Section 8, seeks a judicial
          adjudication of his rights under, or to recover damages for breach of,
          this Agreement, or to recover under any directors' and officers'
          liability insurance policies maintained by the Company, the Company
          shall pay on his behalf, in advance, any and all Expenses incurred by
          him in such judicial adjudication, regardless of whether Indemnitee
          ultimately is determined to be entitled to such indemnification,
          advancement of expenses or insurance recovery.

     (e)  The Company shall be precluded from asserting in any judicial
          proceeding commenced pursuant to this

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<PAGE>

Section 8 that the procedures and presumptions of this Agreement are not valid,
binding and enforceable and shall stipulate in any such court that the Company
is bound by all the provisions of this Agreement.

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<PAGE>

9.   NON-EXCLUSIVITY; SURVIVAL OF RIGHTS; INSURANCE; SUBROGATION.

     (a)  The rights of indemnification, advancement or contribution set forth
          in this Agreement shall not be deemed exclusive of any other rights to
          which Indemnitee may at any time be entitled under applicable law, the
          Charter of the Company, the By-Laws of the Company or any other
          agreement to which the Indemnitee, the Company or any Affiliates of
          the Company is a party. No amendment, alteration or repeal of this
          Agreement or any provision hereof shall limit or restrict any right of
          Indemnitee under this Agreement in respect of any action taken or
          omitted by Indemnitee as a function of his Corporate Status prior to
          such amendment, alteration or repeal. To the extent that a change in
          the law, whether by statute or judicial decision, permits greater
          indemnification, advancement or contribution rights than currently are
          afforded under the Charter of the Company, the By-Laws of the Company
          and this Agreement, it is the intent of the parties hereto that
          Indemnitee shall enjoy by this Agreement the greater benefits so
          afforded by such change. No right or remedy conferred herein is
          intended to be exclusive of any other right or remedy of Indemnitee,
          and every other right or remedy shall be cumulative and in addition to
          every other right or remedy given hereunder or now or hereafter
          existing at law or in equity or otherwise. The assertion or employment
          of any right or remedy hereunder shall not prevent the concurrent
          assertion or employment of any other right or remedy.

     (b)  To the extent that the Company maintains an insurance policy or
          policies providing liability insurance for a director, officer,
          partner, employee, trustee, agent, attorney-in-fact or fiduciary of
          any Company Entity or of any other corporation, partnership, joint
          venture, trust, employee benefit plan or other enterprise which such
          Person serves at the request of any Company Entity, Indemnitee shall
          be covered by such policy or policies in accordance with its or their
          terms to the maximum extent of the coverage available for any such
          director, officer, partner, employee, trustee, agent, attorney-in-fact
          or fiduciary under such policy or policies. If, at the time of a
          request for indemnification under this Agreement, the Company has such
          a policy or policies in effect, the Company shall give prompt notice
          of the commencement of a Proceeding to the insurers in accordance with
          the procedures set forth in the respective policy or policies. The
          Company shall thereafter take all necessary or desirable action to
          cause such insurers to pay, on behalf of the Indemnitee, all amounts
          payable as a result of such Proceeding in accordance with the
          provisions of such policy or policies.

     (c)  In the event of any payment under this Agreement, the Company shall be
          subrogated to the extent of such payment to all of the rights of
          recovery of Indemnitee, who shall execute all papers required and take
          all action necessary to secure such rights, including execution of
          such documents as are necessary to enable the Company to bring suit to
          enforce such rights.

     (d)  The Company shall not be liable under this Agreement to make any
          payment of amounts otherwise indemnifiable hereunder if and to the
          extent that Indemnitee otherwise and actually has received such
          payment under any insurance policy, contract, agreement or otherwise.

10.  DURATION OF AGREEMENT.

     All agreements and obligations of the Company contained herein shall
     continue with respect to Indemnitee during the period in which she serves
     as a director, officer, partner, employee, trustee, agent, attorney-in-fact
     or fiduciary of any Company Entity (or is or was serving at the request of
     any Company Entity as a director, officer, partner, employee, trustee,
     agent, attorney-in-fact or fiduciary of another corporation,

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<PAGE>

     partnership, joint venture, trust or other enterprise), whether or not such
     service occurred prior to or after the date this Agreement was effective,
     and shall continue in perpetuity thereafter, whether or not Indemnitee is
     acting or serving in any such capacity at the time any Expenses or Losses
     are incurred for which indemnification, advancement or contribution can be
     provided under this Agreement. This Agreement shall be binding upon, shall
     inure to the benefit of and shall be enforceable by the parties hereto and
     their respective successors (including any direct or indirect successor by
     purchase, merger, consolidation or otherwise to all or substantially all of
     the business or assets of the Company), assigns, spouses, heirs, executors
     and personal and legal representatives.

11.  SECURITY.

     To the extent requested by Indemnitee and approved by the Company board of
     directors, the Company may at any time and from time to time provide
     security to Indemnitee for the obligations of the Company hereunder through
     an irrevocable bank line of credit, funded trust or other collateral or by
     other means. Any such security, once provided to Indemnitee, may not be
     revoked or released without the prior written consent of Indemnitee.

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<PAGE>

12.  ENFORCEMENT; ENTIRE AGREEMENT.

     (a)  The Company expressly confirms and agrees that it has entered into
          this Agreement and has assumed the obligations imposed on it hereby in
          order to induce Indemnitee to serve or continue to serve as a
          director, officer, partner, employee, trustee, agent, attorney-in-fact
          or fiduciary of any Company Entity, and the Company acknowledges that
          Indemnitee is relying upon this Agreement in agreeing to serve as a
          director, officer, partner, employee, trustee, agent, attorney-in-fact
          or fiduciary of any Company Entity.

     (b)  Subject to Section 9, this Agreement constitutes the entire agreement
          between the parties hereto with respect to the subject matter hereof
          and supersedes all prior agreements and understandings, oral, written
          and implied, between the parties hereto with respect to the subject
          matter hereof, except to the extent referenced in Section 9 hereof.

13.  SEVERABILITY.

     If any provision of this Agreement shall be held by a court of competent
     jurisdiction to be invalid, void, illegal or otherwise unenforceable for
     any reason whatsoever: (i) the validity, legality and enforceability of the
     remaining provisions of this Agreement (including each portion of any
     section of this Agreement containing any such provision held to be invalid,
     illegal or unenforceable that is not itself invalid, illegal or
     unenforceable) shall not be affected or impaired in any way thereby and
     shall remain enforceable to the fullest extent permitted by law; and (ii)
     to the fullest extent possible, the provisions of this Agreement (including
     each portion of any section of this Agreement containing any such provision
     held to be invalid, illegal or unenforceable that is not itself invalid,
     illegal or unenforceable) shall be construed so as to give effect to the
     intent manifested thereby.

14.  MODIFICATION AND WAIVER.

     No supplement, modification, waiver, termination or amendment of all or any
     portion of this Agreement shall be binding unless expressed in a written
     instrument executed by the parties hereto. No waiver of any term or
     provision of this Agreement shall be deemed or shall constitute a waiver of
     any other term or provision hereof (whether or not similar), and any such
     waiver shall be effective only in the specific instance, for the specific
     duration and for the express purpose for which it is given. Any waiver or
     failure to insist upon strict compliance with any term or provision of this
     Agreement shall not operate as a waiver of, or an estoppel with respect to,
     any subsequent or other failure to comply.

15.  NOTICE OF SERVICE BY INDEMNITEE.

     Indemnitee agrees promptly to notify the Company in writing upon being
     served with any summons, citation, subpoena, complaint, indictment or other
     document relating to any Proceeding or matter which may be subject to
     indemnification covered hereunder. The failure to so notify the Company
     shall not relieve the Company of any obligations which it may have to
     Indemnitee under this Agreement or otherwise, except to the extent that the
     Company is prejudiced thereby.

16.  NOTICES.

     All notices, requests, demands and other communications hereunder shall be
     in writing and shall be deemed

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<PAGE>

     to have been duly given if (i) delivered and receipted for by the party to
     whom said notice or other communication shall have been directed; (ii)
     mailed by certified or registered mail with postage prepaid, on the third
     business day after the date on which it is so mailed; or (iii) sent by
     facsimile, the successful transmission and receipt of which is confirmed in
     a written report; in each instance to the addresses and/or facsimile
     numbers set forth below:

     (a)  If to Indemnitee, to: Suzette Nanovic Berrios 4 Loch Court, Jackson,
          NJ 08527 Facsimile: 732-942-1178

     (b)  If to the Company, to:

                                   Hanover Capital Mortgage Holdings, Inc.
                                   200 MetroplexDrive - Suite 100
                                   Edison, New Jersey 08817
                                   Attention: Chief Operating Officer
                                   Facsimile: (732) 548-0286

     or to such other address or facsimile number as may have been furnished to
     Indemnitee by the Company, as the case may be.

17.  IDENTICAL COUNTERPARTS.

     This Agreement may be executed in one or more counterparts, each of which
     shall for all purposes be deemed to be an original but all of which
     together shall constitute one and the same agreement. Only one such
     counterpart signed by the party against whom enforceability is sought needs
     to be produced to evidence the existence of this Agreement.

18.  HEADINGS.

     The headings of the paragraphs of this Agreement are inserted for
     convenience only and shall not be deemed to constitute part of this
     Agreement or to affect the construction or interpretation thereof.

19.  GOVERNING LAW.

     The parties agree that this Agreement shall be governed by, and construed
     and enforced in accordance with, the laws of Maryland without application
     of the conflict of laws principles thereof.

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

                                        HANOVER CAPITAL MORTGAGE HOLDINGS, INC.

                                        By: /s/ John A. Burchett
                                            ------------------------------------
                                            John A. Burchett

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<PAGE>

                                        President and CEO

                                        INDEMNITEE

                                        /s/ Suzette Nanovic Berrios
                                        ----------------------------------------
                                        Suzette Nanovic Berrios

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