Document:

Exhibit 10.3(4)

 

AMENDMENT NO. 4 

TO MASTER REPURCHASE AGREEMENT

 

This FOURTH AMENDMENT TO MASTER
REPURCHASE AGREEMENT (this “Amendment”) is dated as of November 9,
2005 and is entered into by and among FIELDSTONE INVESTMENT CORPORATION (“FIC”
and a “Seller”), FIELDSTONE MORTGAGE COMPANY (“FMC” and a “Seller”,
and together with FIC, the “Sellers”) and MERRILL LYNCH BANK USA (the “Buyer”)
to that certain Master Repurchase Agreement dated as of November 12, 2004
as amended by Amendment No. 1 to Master Repurchase Agreement dated as of May 10,
2005, Amendment No. 2 to Master Repurchase Agreement dated as of June 1,
2005 and Amendment No. 3 to Master Repurchase Agreement dated as of July 11,
2005 (the “Existing Repurchase Agreement”, as amended by this Amendment,
the “Repurchase Agreement”). 
Capitalized terms used but not otherwise defined herein shall have the
meanings given to them in the Existing Repurchase Agreement.

 

RECITALS

 

The Buyer and the Sellers have agreed, subject to the
terms and conditions of this Amendment, that the Existing Repurchase Agreement
be amended to reflect certain agreed upon revisions to the terms of the
Existing Repurchase Agreement.

 

Accordingly, the Buyer and the Sellers hereby agree,
in consideration of the mutual promises and mutual obligations set forth
herein, that the Existing Repurchase Agreement is hereby amended as follows:

 

SECTION 1.           Definitions.  Section 2 of the Existing Repurchase
Agreement is hereby amended by deleting the definition of “Termination Date” in
its entirety and replacing it with the following:

 

““Termination Date” shall mean December 9,
2005.”

 

SECTION 2.           Conditions Precedent.  This Amendment shall become effective on November 9,
2005 (the “Amendment Effective Date”) subject to the satisfaction of the
following conditions precedent:

 

2.1           Delivered Documents.  On the Amendment Effective Date, the Buyer
shall have received the following documents, each of which shall be
satisfactory to the Buyer in form and substance:

 

(a)           this
Amendment, executed and delivered and duly authorized officers of the Buyer and
the Sellers; and

 

(b)           such
other documents as the Buyer or counsel to the Buyer may reasonably request.

 

 

SECTION 3.           Limited Effect.  Except as expressly amended and modified by
this Amendment, the Existing Repurchase Agreement shall continue to be, and
shall remain, in full force and effect in accordance with its terms.

 

SECTION 4.           Fees.  The Seller agrees to pay as and when billed
by the Buyer all of the reasonable fees, disbursements and expenses of counsel
to the Buyer in connection with the development, preparation and execution of,
this Amendment or any other documents prepared in connection herewith and
receipt of payment thereof shall be a condition precedent to the Buyer entering
into any Transaction pursuant hereto.

 

SECTION 5.           Confidentiality.  The parties hereto acknowledge that this
Amendment, the Existing Repurchase Agreement, and all drafts thereof, documents
relating thereto and transactions contemplated thereby are confidential in
nature and the Seller agree that, unless otherwise directed by a court of
competent jurisdiction or as is necessary to do so in working with governmental
agencies or regulatory bodies in order to comply with any applicable federal or
state laws, they shall limit the distribution of such documents and the
discussion of such transactions to such of its officers, employees, attorneys,
accountants and agents as is required in order to fulfill its obligations under
such documents and with respect to such transactions.

 

SECTION 6.           GOVERNING LAW.  THIS AMENDMENT 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.

 

SECTION 7.           Counterparts.  This Amendment may be executed in one or more
counterparts and by different parties hereto on separate counterparts, each of
which, when so executed, shall constitute one and the same agreement.

 

SECTION 8.           Conflicts.  The parties hereto agree that in the event
there is any conflict between the terms of this Amendment, and the terms of the
Existing Repurchase Agreement, the provisions of this Amendment shall control.

 

[SIGNATURE PAGE FOLLOWS]

 

2

 

IN WITNESS WHEREOF, the parties have caused their
names to be signed hereto by their respective officers thereunto duly
authorized as of the day and year first above written.

 

 

	
  Buyer:

  	
  MERRILL
  LYNCH BANK USA,

  
	
   

  	
  as
  Buyer

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  
	
   

  	
   

  
	
  Seller:

  	
  FIELDSTONE
  INVESTMENT

  CORPORATION,

  
	
   

  	
  as
  Seller

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  
	
   

  	
   

  
	
  Seller:

  	
  FIELDSTONE
  MORTGAGE COMPANY,

  
	
   

  	
  as
  Seller

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:Exhibit
10.4

 

	
  

  	
  FIELDSTONE
  INVESTMENT CORPORATION

  

 

RE:         EXTENDED
SEVERANCE BENEFIT

 

Dear John:

 

Fieldstone
Investment Corporation (“Fieldstone” or “the Company”) greatly values your
contributions as a senior manager of Fieldstone and the quality of the services
that you provide the Company.

 

Because of the importance of your role and in
order to reduce any uncertainty you may feel regarding your future with the
Company, we are very pleased to offer to you an extended severance
benefit.  It is our expectation that you
and Fieldstone will have a positive long term relationship.  However, because Fieldstone is a publicly
traded company, no one can predict whether there ever will be a “change in
control” regarding Fieldstone.

 

The Company wishes to minimize the uncertainties
that may arise in connection with a Change in Control (as defined in Exhibit A
to this letter) by providing you with an extended severance benefit payable in
connection with a Change in Control, subject to the terms and conditions of
this letter as set forth in the attachment entitled “Terms and Conditions” (the
“Extended Severance Benefit”) as follows:

 

If a Change in
Control occurs while you are employed by the Company and you undergo or are
subject to a Qualifying Termination during the one year period following the
Change in Control, you will be eligible for a single, “lump sum” severance
payment in an amount equal to twenty-four (24) months of
your then current base salary.

 

In the event of a Change in Control, this
Extended Severance Benefit will apply in lieu of any other severance pay to
which you may be entitled under any Company severance plan, program, practice
or arrangement.

 

Sincerely,

 

 

Michael J. Sonnenfeld, President and Chief
Executive Officer

 

Accepted and Agreed:

 

 

	
   

  	
   

  
	
   

  
	
  Date:

  	
   

  	
   

  
				

 

 

Terms & Conditions

 

You must be in
the employ of the Company at the time of the Change in Control to be eligible
for the Extended Severance Benefit.  Your
Extended Severance Benefit will be paid in a single lump sum payment within
thirty (30) days following your Qualifying Termination, subject to any delay in
payment required to avoid the additional tax imposed by Section 409A of
the Internal Revenue Code.

 

For the purpose of your Extended Severance Benefit, a “Qualifying
Termination” means: (i) you terminate your employment with the Company or
its successor for Good Reason (as defined in herein) or (ii) your
employment with the Company or its successor is terminated by the Company or
its successor for a reason other than for Cause (as defined in the Company’s
Equity Incentive Plan as of the date of this letter).  Your termination of employment must occur
within one year following a Change in Control to be a Qualifying
Termination.  Further, you will not be
considered to have undergone a Qualifying Termination if upon your termination
of employment you are immediately thereafter reemployed by the Company’s
successor (or a parent or affiliate of the Company or its successor).  For the purpose of this letter agreement and
your Extended Severance Benefit hereunder, “Good Reason” means, without your
consent, a material reduction in your base salary or responsibilities, or a
required relocation of your principal place of employment immediately preceding
the Change in Control by more than 25 miles.

 

If a Change in
Control occurs and you do not undergo a Qualifying Termination within the one
year period following the closing of the Change in Control, you will not be
entitled to the Extended Severance Benefit.

 

The Company’s
Compensation Committee will make all decisions and interpretations regarding
your Extended Severance Benefit, and the decisions and interpretations of the
Compensation Committee are final, binding and conclusive.

 

Your Extended
Severance Benefit will be reduced by any taxes or other amounts required to be
withheld by the Company under applicable law. 
You remain an employee-at-will of the Company.  Nothing in this letter constitutes, and shall
not be construed to provide, any assurance of your continuing employment with
the Company, its affiliates or successors.

 

Prior to the
occurrence of a Change in Control, the Company has the right, in its sole
control and discretion, to amend or terminate this letter agreement

 

 

and your
Severance Benefit at any time and for any reason and without consideration to
you, upon sixty (60) days written notice to you.

 

 

Exhibit A

 

For purposes of your
Severance Benefit, a “Change in Control” means:

 

(1)           The acquisition by any individual, entity or
group (within the meaning of Section 13(d)(3) or 14(d)(2) of the
Securities Exchange Act of 1934, as amended (the “Exchange Act”)) (a “Person”)
of beneficial ownership (within the meaning of Rule 13d-3 promulgated
under the Exchange Act) of more than 50% of either (i) the then
outstanding shares of common stock of the Company (the “Outstanding Company
Common Stock”) or (ii) the combined voting power of the then outstanding
voting securities of the Company entitled to vote generally in the election of
directors (the “Outstanding Company Voting Securities”); provided, however,
that for purposes of this Section 1, the following acquisitions shall not
constitute a Change in Control: (i) any acquisition by the Company; (ii) any
acquisition by any employee benefit plan (or related trust) sponsored or
maintained by the Company or any corporation controlled by the Company; and (iii) any
acquisition by any entity pursuant to a transaction which complies with clauses
(i), (ii) and (iii) of Section (3) of this Exhibit A;
or

 

(2)           Individuals who, as of the date hereof,
constitute the Company’s Board of Directors (the “Incumbent Board”) cease for
any reason to constitute at least a majority of the Board; provided, however,
that any individual becoming a director subsequent to the date hereof whose
election, or nomination for election by the Company’s shareholders, was
approved by a vote of at least a majority of the directors then comprising the
Incumbent Board shall be considered as though such individual were a member of
the Incumbent Board, but excluding, for this purpose, any such individual whose
initial assumption of office occurs as a result of an actual or threatened
election contest with respect to the election or removal of directors or other
actual or threatened solicitation of proxies or consents by or on behalf of a
Person other than the Board; or

 

(3)           Consummation of a reorganization, merger or
consolidation or sale or other disposition of all or substantially all of the
assets of the Company (a “Business Combination”), in each case unless,
following such Business Combination, (i) all or substantially all of the
individuals and entities who were the beneficial owners, respectively, of the
Outstanding Company Common Stock and Outstanding Company Voting Securities
immediately prior to such Business Combination beneficially own, directly or
indirectly, more than 50% of, respectively, the then outstanding shares of
common stock and the combined voting power of the then outstanding voting
securities entitled to vote generally in the election of directors, as the case
may be, of the entity resulting from such Business Combination (including,
without limitation, a corporation which as a result of such transaction owns
the Company or all or substantially all of the Company’s assets either directly
or through one or more subsidiaries) in substantially the same proportions as
their

 

 

ownership, immediately prior
to such Business Combination of the Outstanding Company Common Stock and
Outstanding Company Voting Securities, as the case may be, and (ii) no
Person (excluding any corporation resulting from such Business Combination or
any employee benefit plan (or related trust) of the Company or such corporation
resulting from such Business Combination) beneficially owns, directly or
indirectly, 35% or more of, respectively, the then outstanding shares of common
stock of the corporation resulting from such Business Combination or the
combined voting power of the then outstanding voting securities of such
corporation except to the extent that such ownership existed prior to the
Business Combination and (iii) at least a majority of the members of the
board of directors of the corporation resulting from such Business Combination
were members of the Incumbent Board at the time of the execution of the initial
agreement, or of the action of the Board, providing for such Business
Combination; or

 

(4)           Approval by the shareholders of the Company
of a complete liquidation or dissolution of the Company.

 

(5)           This
letter agreement shall apply only to the first Change in Control that occurs
following the date of this letter.

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