Document:

EX-10.2.

Exhibit 10.2

EXECUTION VERSION

AMENDED AND RESTATED MASTER REPURCHASE AGREEMENT

Among:

MERRILL LYNCH BANK USA, as the Buyer,

FIELDSTONE MORTGAGE COMPANY, as a Seller

and

FIELDSTONE INVESTMENT CORPORATION, as a Seller

Dated as of October 31, 2006

1

TABLE OF CONTENTS

Page

	 	 	 
	SECTION 1.

SECTION 2.

SECTION 3.

SECTION 4.

SECTION 5.

SECTION 6.

SECTION 7.

SECTION 8.

SECTION 9.

SECTION 10.

SECTION 11.

SECTION 12.

SECTION 13.

SECTION 14.

SECTION 15.

SECTION 16.

SECTION 17.

SECTION 18.

SECTION 19.

SECTION 20.

SECTION 21.

SECTION 22.

SECTION 23.

SECTION 24.

SECTION 25.

SECTION 26.

SECTION 27.

SECTION 28.

SECTION 29.

SECTION 30.

SECTION 31.

SECTION 32.

SECTION 33.

SECTION 34.

SECTION 35.

SECTION 36.

SECTION 37.

	 	APPLICABILITY

DEFINITIONS

INITIATION; TERMINATION

MARGIN AMOUNT MAINTENANCE

INCOME PAYMENTS

REQUIREMENTS OF LAW

TAXES.

SECURITY INTEREST; BUYER DEED

PAYMENT, TRANSFER AND CUSTODY

HYPOTHECATION OR PLEDGE OF PURCHASED ASSETS

REPRESENTATIONS

COVENANTS

EVENTS OF DEFAULT

REMEDIES

INDEMNIFICATION AND EXPENSES; RECOURSE

SERVICING

SINGLE AGREEMENT

SET-OFF

NOTICES AND OTHER COMMUNICATIONS

ENTIRE AGREEMENT; SEVERABILITY

NON-ASSIGNABILITY

TERMINABILITY

GOVERNING LAW

SUBMISSION TO JURISDICTION; WAIVERS

NO WAIVERS, ETC.

NETTING

DUE DILIGENCE

NON-UTILIZATION FEE

COMMITMENT FEE

BUYER’S APPOINTMENT AS ATTORNEY-IN-FACT

MISCELLANEOUS

CONFIDENTIALITY

INTENT

DISCLOSURE RELATING TO CERTAIN FEDERAL PROTECTIONS

CONFLICTS

AUTHORIZATIONS

ACKNOWLEDGEMENT OF ANTI-PREDATORY LENDING POLICIES.
	 
	 	 

2

EXHIBITS

	 	 	 
	SCHEDULE 1

SCHEDULE 2

SCHEDULE 3

EXHIBIT I

EXHIBIT II

EXHIBIT III

EXHIBIT IV

EXHIBIT V

EXHIBIT VI

EXHIBIT VII

EXHIBIT VIII

EXHIBIT IX

EXHIBIT X

EXHIBIT XI

EXHIBIT XII

	 	Representations and Warranties Re: Mortgage Loans and REO Property

Existing Indebtedness

Takeout Investors

Form of Confirmation Letter

Form of Opinion Letter

UCC Filing Jurisdictions

Form of Account Agreement

Asset Schedule Fields

Asset File Documents

Underwriting Guidelines

Sellers’ Officer’s Certificate

Form of Servicer Notice

Authorized Representatives

Responsible Officers

Form of Section 7 Certificate

3

AMENDED AND RESTATED MASTER REPURCHASE AGREEMENT

This is an AMENDED AND RESTATED MASTER REPURCHASE AGREEMENT, dated as of October 31, 2006,
among FIELDSTONE MORTGAGE COMPANY, a Maryland corporation (“FMC” and a “Seller”),
FIELDSTONE INVESTMENT CORPORATION, a Maryland corporation (“FIC” and a “Seller”
and, together with FMC, the “Sellers”), and MERRILL LYNCH BANK USA, a Utah industrial loan
corporation (the “Buyer”).

The Buyer and the Sellers are parties to that certain Master Repurchase Agreement, dated as of
November 12, 2004, as amended by Amendment No. 1 dated as of May 10, 2005, Amendment No. 2 dated as
of June 1, 2005, Amendment No. 3 dated as of July 11, 2005, Amendment No. 4 dated as of November 9,
2005, Amendment No. 5 dated as of December 6, 2005 and Amendment No. 6 dated as of April 24, 2006
(the “Existing Repurchase Agreement”, as amended by this Amendment, the “Repurchase
Agreement”).

The parties have requested that the Existing Repurchase Agreement be amended and restated on
the terms and conditions set forth herein.

	 	 	SECTION 1. APPLICABILITY

From time to time the parties hereto shall enter into transactions in which the respective
Seller agrees to transfer to the Buyer Mortgage Loans and REO Properties against the transfer of
funds by the Buyer, with a simultaneous agreement by the Buyer to transfer to either Seller or its
designee such Mortgage Loans and/or REO Properties at a date certain not later than the date 364
days after the related Purchase Date, against the transfer of funds by such Seller. Each such
transaction shall be referred to herein as a “Transaction” and shall be governed by this
Repurchase Agreement, unless otherwise agreed in writing. This Repurchase Agreement is a
commitment by the Buyer to engage in Transactions as set forth herein up to the Maximum Purchase
Price; provided that the Buyer shall have no commitment to enter into any Transaction requested
which would result in the aggregate Purchase Price of the then outstanding Transactions exceeding
the Maximum Purchase Price.

	 	 	SECTION 2. DEFINITIONS

As used herein, the following terms shall have the following meanings (all terms defined in this
Section 2 or in other provisions of this Repurchase Agreement in the singular to have the same
meanings when used in the plural and vice versa):

“Acceptable SPV” shall mean a Person (established by either Seller) which issues
Structured Securities Debt.

“Accepted Servicing Practices” shall mean, with respect to any Mortgage Loan or REO
Property, those mortgage servicing practices of prudent mortgage lending institutions which service
mortgage loans and REO Property of the same type as such Mortgage Loan or REO Property in the
jurisdiction where the related Mortgaged Property or REO Property is located.

“Account Agreement” shall mean a letter agreement between the Sellers, the Buyer, and
a depository institution to be mutually agreed upon by the Buyer and the Sellers.

“Additional Purchased Assets” shall mean Eligible Assets or cash provided by either
Seller to the Buyer or its designee pursuant to Section 4 of this Repurchase Agreement.

“Affiliate” shall mean with respect to any Person, any “affiliate” of such Person, as
such term is defined in the Bankruptcy Code.

“Agency” shall mean Freddie Mac or Fannie Mae, as applicable.

“Agency Security” shall mean a mortgage-backed security issued by an Agency.

“Agency Takeout Commitment” shall mean a commitment by an Agency to (a) purchase the
Mortgage Loan under any of its cash purchase programs or (b) (i) swap one or more Mortgage Loans
for an Agency Security, and (ii) sell the related Agency Security to a Takeout Investor.

“Appraised Value” shall mean the value set forth in an appraisal made in connection
with the origination of the related Mortgage Loan as the value of the Mortgaged Property.

“Asset File” shall mean, with respect to a Purchased Asset, the documents and
instruments relating to such Purchased Asset and set forth in Exhibit VI hereto.

“Asset Schedule” shall mean with respect to any Transaction as of any date, an Asset
Schedule in the form of a computer tape or other electronic medium generated by the related Seller
and delivered to the Buyer and the Custodian, which provides information (including, without
limitation, the information set forth on Exhibit V attached hereto) relating to the
Purchased Assets in a format acceptable to the Buyer.

“Asset Schedule and Exception Report” shall have the meaning set forth in the
applicable Custodial Agreement.

“Asset Value” shall mean

(i) with respect to each Eligible Asset (other than Sub-Performing Mortgage Loans,
Non-Performing Mortgage Loans, Re-Performing Mortgage Loans, REO Properties or Mortgage Loans in
Foreclosure) the applicable Purchase Price Percentage for the related Eligible Asset multiplied by
the lesser of (x) the Market Value of such Eligible Asset and (y) the outstanding principal balance
of such Eligible Asset;

(ii) with respect to each Eligible Asset that is a Re-Performing Mortgage Loan,
Non-Performing Mortgage Loan, Sub-Performing Mortgage Loan, REO Property or Mortgage Loan in
Foreclosure the applicable Purchase Price Percentage for the related Eligible Asset multiplied by
the lesser of (x) the Market Value of such Eligible Asset and (y) the acquisition price paid by the
Seller in acquiring such Eligible Asset.

(a) Without limiting the generality of the foregoing, the Sellers acknowledge that the Asset
Value of a Purchased Asset may be reduced to zero by the Buyer if:

(i) such Purchased Asset ceases to be an Eligible Asset;

(ii) the Purchased Asset has been released from the possession of the Custodian under
the Custodial Agreement (other than to a Takeout Investor pursuant to a Bailee Letter) for a
period in excess of 15 calendar days;

(iii) the Purchased Asset has been released from the possession of the Custodian under
the Custodial Agreement pursuant to a Bailee Letter or an Attorney Bailee Letter, as
applicable, for a period in excess of 30 calendar days

(iv) the Purchased Asset is a Wet-Ink Mortgage Loan for which the related Asset File
has not been received and certified by the Custodian by the eighth Business Day following
the related Purchase Date;

(v) such Purchased Asset is rejected by the related Takeout Investor;

(vi) such Purchased Asset (other than a Sub-Performing Mortgage Loan, Non-Performing
Mortgage Loan, Re-Performing Mortgage Loan, REO Property or Mortgage Loan in Foreclosure)
has been subject to a Transaction hereunder for period of greater than 150 days;

(vii) such Purchased Asset is a Sub-Performing Mortgage Loan, Non-Performing Mortgage
Loan, Re-Performing Mortgage Loan, REO Property or Mortgage Loan in Foreclosure that has
been subject to a Transaction hereunder for period of greater than 360 days;

(viii) the Buyer has determined in its commercially reasonable discretion that the
Purchased Asset (other than with respect to any Mortgage Loan in Foreclosure or an REO
Property) is not eligible for whole loan sale or securitization in a transaction consistent
with the prevailing sale and securitization industry with respect to substantially similar
Mortgage Loans;

(ix) such Purchased Asset contains a breach of a representation or warranty made by a
Seller in this Repurchase Agreement or the Custodial Agreement;

(b) the aggregate Asset Value of all D Quality Non-Conforming Mortgage Loans that are
Purchased Assets shall not exceed $5,000,000;

(c) the aggregate Asset Value of all Purchased Assets with a CLTV in excess of 100% shall not
exceed $5,000,000;

(d) the aggregate Asset Value of all Land-and-Home Contracts shall not exceed
$10,000,000;

(e) the aggregate Asset Value of all Wet-Ink Mortgage Loans that are Purchased Assets shall
not exceed $100,000,000;

(f) the aggregate Asset Value of all Second Lien Mortgage Loans that are Purchased Assets
shall not exceed $100,000,000;

(g) the aggregate Asset Value of all Balloon Loans that are Purchased Assets shall not
exceed $65,000,000;

(h) the aggregate Asset Value of all Mortgage Loans in Foreclosure, Non-Performing Mortgage
Loans, Sub-Performing Mortgage Loans, REO Properties and Re-Performing Mortgage Loans, combined,
that are Purchased Assets shall not exceed $200,000,000;

(i) the aggregate Asset Value of all Sub-Performing Mortgage Loans that are Purchased Assets
shall not exceed $125,000,000;

(j) the aggregate Asset Value of all Re-Performing Mortgage Loans that are Purchased Assets
shall not exceed $125,000,000;

(k) the aggregate Asset Value of all Non-Performing Mortgage Loans that are Purchased Assets
shall not exceed $100,000,000;

(l) the aggregate Asset Value of all Mortgage Loans in Foreclosure that are Purchased Assets
shall not exceed $45,000,000;

(m) the aggregate Asset Value of all Purchased Assets that are REO Properties shall not exceed
$50,000,000.

“Assignment and Acceptance” shall have the meaning specified in Section 21 hereof.

“Authorized Representative” shall mean, for the purposes of this Repurchase Agreement
only, an agent or Responsible Officer of the Sellers listed on Exhibit X hereto, as such
Exhibit X may be amended from time to time.

“Bailee Letter” shall have the meaning assigned to such term in the Custodial
Agreement.

“Balloon Loan” shall mean a Mortgage Loan which, by its terms, does not fully amortize
by the stated maturity date.

“Bankruptcy Code” shall mean the United States Bankruptcy Code of 1978, as amended
from time to time.

“Business” shall mean the residential mortgage lending business and all ancillary
business activities related thereto, including, without limitation, the direct or indirect
extension of loans or credit to Persons (including, without limitation, borrowers, brokers and
lenders) in connection therewith.

“Business Day” shall mean a day other than (a) a Saturday or Sunday, (b) any day on
which banking institutions are authorized or required by law, executive order or governmental
decree to be closed in the State of New York or (c) any day on which the New York Stock Exchange is
closed.

“Buyer” shall mean Merrill Lynch Bank USA, its successors in interest and assigns, and
with respect to Section 7, participants.

“Buyer Deed” shall have the meaning specified in Section 8 hereof.

“Capital Lease Obligations” shall mean, for any Person, all obligations of such Person
to pay rent or other amounts under a lease of (or other agreement conveying the right to use)
Property to the extent such obligations are required to be classified and accounted for as a
capital lease on a balance sheet of such Person under GAAP, and, for purposes of this Repurchase
Agreement, the amount of such obligations shall be the capitalized amount thereof, determined in
accordance with GAAP.

“Cash Flow Velocity” shall mean, with respect to a Mortgage Loan, the number of
Monthly Payments paid during a Test Period divided by the total number of Monthly Payments owed
during such Test Period.

“Change in Control” shall mean:

(a) any transaction or event as a result of which FIC ceases to own, directly or
indirectly, 100% of the stock of FMC;

(b) the sale, transfer, or other disposition of all or substantially all of a Seller’s
assets (excluding any such action taken in connection with any securitization transaction);
or

(c) the consummation of a merger or consolidation of FIC with or into another entity or
any other corporate reorganization, if more than 50.1% of the combined voting power of the
continuing or surviving entity’s stock outstanding immediately after such merger,
consolidation or such other reorganization is owned by persons who were not stockholders of
the Seller immediately prior to such merger, consolidation or other reorganization.

“Code” shall mean the Internal Revenue Code of 1986, as amended from time to time.

“Collection Account” shall mean the account established by a financial institution
acceptable to the Buyer subject to an Account Agreement, into which all Income shall be deposited
after the occurrence of a Default or an Event of Default.

“Combined Loan to Value Ratio” or “CLTV” shall mean, with respect to any
Second Lien Mortgage Loan, the sum of the original principal balance of such Mortgage Loan and the
outstanding principal balance of any related first lien as of the date of origination of the
Mortgage Loan, divided by the Appraised Value of the Mortgaged Property as of the origination date.

“Commitment Fee” shall mean the product of (x) 0.125% per annum and (y) the Maximum
Purchase Price.

“Committed Mortgage Loan” shall mean a Mortgage Loan which is the subject of a Takeout
Commitment with a Takeout Investor.

“Confirmation” shall mean a Confirmation Letter in the form of Exhibit I
hereto.

“Conforming Mortgage Loan” shall mean a first lien Mortgage Loan that (i) conforms to
the requirements of an Agency for securitization or cash purchase and (ii) is subject to an Agency
Takeout Commitment or a Takeout Commitment, including, without limitation, conventional Mortgage
Loans, FHA Loans and VA Loans.

“Consolidated Tangible Net Worth” shall mean the consolidated Tangible Net Worth of
the Sellers in accordance with GAAP.

“Custodial Agreement” shall mean that certain Amended and Restated Custodial Agreement
dated as of the date hereof, among Sellers, the Buyer and Custodian as the same may be amended from
time to time.

“Custodian” shall mean Wells Fargo Bank, N.A., or any successor thereto under the
Custodial Agreement.

“D Quality Non-Conforming Mortgage Loan” shall mean a first lien Mortgage Loan
originated in accordance with the criteria established under the “D First Lien Standard Program
Parameters” as set forth in the Underwriting Guidelines.

“Default” shall mean an Event of Default or an event that with notice or lapse of time
or both would become an Event of Default.

“Dollars” and “$” shall mean lawful money of the United States of America.

“Due Date” shall mean the day of the month on which the Monthly Payment is due on a
Mortgage Loan, exclusive of any days of grace.

“Due Diligence Review” shall mean the performance by the Buyer of any or all of the
reviews permitted under Section 27 hereof with respect to any or all of the Mortgage Loans and REO
Properties, as desired by the Buyer from time to time.

“Effective Date” shall mean the date upon which the conditions precedent set forth in
Section 3(a) shall have been satisfied.

“Electronic Tracking Agreement” shall mean an Electronic Tracking Agreement among the
Buyer, the Sellers, MERS and MERSCORP, Inc., to the extent applicable as amended from time to time.

“Eligible Assets” shall mean Purchased Assets which comply with the representations
and warranties set forth on Schedule 1 to this Repurchase Agreement and, if a Mortgage
Loan, is either (a) a Conforming Mortgage Loan, (b) a D Quality Non-Conforming Mortgage Loan, (c) a
Jumbo Mortgage Loan, (d) a Sub-Prime Mortgage Loan or (e) a Land-and-Home Contract.

“ERISA” shall, with respect to any Person, mean the Employee Retirement Income
Security Act of 1974, as amended from time to time and any successor thereto, and the regulations
promulgated and rulings issued thereunder.

“ERISA Affiliate” shall, with respect to any Person, mean any Person which is a member
of any group of organizations (a) described in Section 414(b) or (c) of the Code of which such
Person is a member, or (b) solely for purposes of potential liability under Section 302(c)(11) of
ERISA and Section 412(c)(11) of the Code and the lien created under Section 302(f) of ERISA and
Section 412(n) of the Code, described in Section 414(m) or (o) of the Code of which such Person is
a member.

“Event of Default” shall have the meaning specified in Section 13.01 hereof.

“Event of Insolvency” shall mean, for any Person:

(a) that such Person or any Affiliate shall discontinue or abandon operation of its business;
or

(b)  that such Person or any Affiliate shall fail generally to, or admit in writing its
inability to, pay its debts as they become due; or

(c) a proceeding shall have been instituted in a court having jurisdiction in the premises
seeking a decree or order for relief in respect of such Person or any Affiliate in an involuntary
case under any applicable bankruptcy, insolvency, liquidation, reorganization or other similar law
now or hereafter in effect, or for the appointment of a receiver, liquidator, assignee, trustee,
custodian, sequestrator, conservator or other similar official of such Person or any Affiliate, or
for any substantial part of its property, or for the winding-up or liquidation of its affairs and
such proceeding shall continue for sixty (60) days without having been dismissed or discharged; or

(d)  the commencement by such Person or any Affiliate of a voluntary case under any applicable
bankruptcy, insolvency or other similar Law now or hereafter in effect, or such Person’s or any
Affiliate’s consent to the entry of an order for relief in an involuntary case under any such Law,
or consent to the appointment of or taking possession by a receiver, liquidator, assignee, trustee,
custodian, sequestrator, conservator or other similar official of such Person, or for any
substantial part of its property, or any general assignment for the benefit of creditors; or

(e) that such Person or any Affiliate shall become insolvent; or

(f) if such Person or any Affiliate is a corporation, such Person or any Affiliate, or any of
their Subsidiaries, shall take any corporate action in furtherance of, or the action of which would
result in any of the actions set forth in the preceding clause (a), (b), (c), (d) or (e).

“Event of Termination” shall, with respect to each Seller, mean (a) with respect to
any Plan, a reportable event, as defined in Section 4043 of ERISA, as to which the PBGC has not by
regulation waived the requirement of Section 4043(a) of ERISA that it be notified within 30 days of
the occurrence of such event, or (b) the withdrawal of such Seller or any ERISA Affiliate thereof
from a Plan during a plan year in which it is a substantial employer, as defined in
Section 4001(a)(2) of ERISA, or (c) the failure by such Seller or any ERISA Affiliate thereof to
meet the minimum funding standard of Section 412 of the Code or Section 302 of ERISA with respect
to any Plan, including, without limitation, the failure to make on or before its due date a
required installment under Section 412(m) of the Code or Section 302(e) of ERISA, or (d) the
distribution under Section 4041 of ERISA of a notice of intent to terminate any Plan or any action
taken by such Seller or any ERISA Affiliate thereof to terminate any Plan, or (e) the adoption of
an amendment to any Plan that, pursuant to Section 401(a)(29) of the Code or Section 307 of ERISA,
would result in the loss of tax-exempt status of the trust of which such Plan is a part if the
Seller or any ERISA Affiliate thereof fails to timely provide security to the Plan in accordance
with the provisions of said Sections, or (f) the institution by the PBGC of proceedings under
Section 4042 of ERISA for the termination of, or the appointment of a trustee to administer, any
Plan, or (g) the receipt by such Seller or any ERISA Affiliate thereof of a notice from a
Multiemployer Plan that action of the type described in the previous clause (f) has been taken by
the PBGC with respect to such Multiemployer Plan, or (h) any event or circumstance exists which may
reasonably be expected to constitute grounds for such Seller or any ERISA Affiliate thereof to
incur liability under Title IV of ERISA or under Sections 412(c)(11) or 412(n) of the Code with
respect to any Plan.

“Excluded Taxes” shall have the meaning specified in Section 7(f).

“Expenses” shall mean all present and future reasonable expenses incurred by or on
behalf of the Buyer in connection with this Repurchase Agreement or any of the other Repurchase
Documents and any amendment, supplement or other modification or waiver related hereto or thereto,
whether incurred heretofore or hereafter, which expenses shall include the cost of title, lien,
judgment and other record searches; attorneys’ fees; and costs of preparing and recording any UCC
financing statements or other filings necessary to perfect the security interest created hereby.

“Fannie Mae” shall mean Fannie Mae, or any successor thereto.

“FHA” shall mean the Federal Housing Administration, an agency within the United
States Department of Housing and Urban Development, or any successor thereto, and including the
Federal Housing Commissioner and the Secretary of Housing and Urban Development where appropriate
under the FHA Regulations.

“FHA Approved Mortgagee” shall mean a corporation or institution approved as a
mortgagee by the FHA under the National Housing Act, as amended from time to time, and applicable
FHA Regulations, and eligible to own and service mortgage loans such as the FHA Loans.

“FHA Loan” shall mean a Mortgage Loan which is the subject of an FHA Mortgage
Insurance Contract.

“FHA Mortgage Insurance” shall mean, mortgage insurance authorized under the National
Housing Act, as amended from time to time, and provided by the FHA.

“FHA Mortgage Insurance Contract” shall mean the contractual obligation of the FHA
respecting the insurance of a Mortgage Loan.

“FHA Regulations” shall mean the regulations promulgated by the Department of Housing
and Urban Development under the National Housing Act, as amended from time to time and codified in
24 Code of Federal Regulations, and other Department of Housing and Urban Development issuances
relating to FHA Loans, including the related handbooks, circulars, notices and mortgagee letters.

“Fidelity Insurance” shall mean insurance coverage with respect to employee errors,
omissions, dishonesty, forgery, theft, disappearance and destruction, robbery and safe burglary,
property (other than money and securities) and computer fraud in an aggregate amount acceptable to
the applicable Seller’s regulators.

“Financial Statements” shall mean the consolidated financial statements of FIC
prepared in accordance with GAAP for the year or other period then ended. Such financial
statements will be audited, in the case of annual statements, by an Independent Accounting Firm.

“First Payment Default” shall mean, with respect to a Mortgage Loan, the failure of
the Mortgagor to make the first Monthly Payment due under the Mortgage Loan on or before its
scheduled Due Date.

“FIC” shall mean Fieldstone Investment Corporation, a Maryland corporation.

“Fitch” shall mean Fitch Ratings, Inc., or any successor thereto.

“FMC” shall mean Fieldstone Mortgage Company, a Maryland corporation.

“Forbearance Plan” shall mean a written repayment plan or forbearance agreement giving
the Mortgagor a definite period in which to reinstate a Mortgage Loan, no more than one (1) year
from the establishment of the repayment plan or forbearance agreement.

“Foreclosure” shall mean the process of a Seller foreclosing upon the property
securing a Mortgage Loan.

“Freddie Mac” shall mean Freddie Mac, formerly known as the Federal Home Loan Mortgage
Corporation, or any successor thereto.

“GAAP” shall mean generally accepted accounting principles in the United States of
America, applied on a consistent basis and applied to both classification of items and amounts, and
shall include, without limitation, the official interpretations thereof by the Financial Accounting
Standards Board, its predecessors and successors.

“Governmental Authority” shall mean the government of the United States of America or
of any state, county, municipality or other political subdivision thereof or any governmental body,
agency, authority, department or commission (including, without limitation, any taxing authority)
or any instrumentality or officer of any of the foregoing (including, without limitation, any court
or tribunal) exercising executive, legislative, judicial, regulatory or administrative functions of
or pertaining to government and any corporation, partnership or other entity directly or indirectly
owned by or controlled by the foregoing.

“Guarantee” shall mean, as to any Person, any obligation of such Person directly or
indirectly guaranteeing any Indebtedness of any other Person or in any manner providing for the
payment of any Indebtedness of any other Person or otherwise protecting the holder of such
Indebtedness against loss (whether by virtue of partnership arrangements, by agreement to
keep-well, to purchase assets, goods, securities or services, or to take-or-pay or otherwise);
provided that the term “Guarantee” shall not include endorsements for collection or deposit
in the ordinary course of business. The amount of any Guarantee of a Person shall be deemed to be
an amount equal to the stated or determinable amount of the primary obligation in respect of which
such Guarantee is made or, if not stated or determinable, the maximum reasonably anticipated
liability in respect thereof as determined by such Person in good faith. The terms
“Guarantee” and “Guaranteed” used as verbs shall have correlative meanings.

“High Cost Mortgage Loan” shall mean a Mortgage Loan classified as (a) a “high cost”
loan under the Home Ownership and Equity Protection Act of 1994 or (b) a “high cost,” “threshold,”
“covered,” or “predatory” loan under any other applicable state, federal or local law (or a
similarly classified loan using different terminology under a law, regulation or ordinance imposing
heightened regulatory scrutiny or additional legal liability for residential mortgage loans having
high interest rates, points and/or fees).

“High Purchase Price Mortgage Loan” shall mean a Purchased Asset designated as a High
Purchase Price Mortgage Loan by Seller in accordance with Section 3.

“HUD” shall mean the Department of Housing and Urban Development.

“Income” shall mean, (a) with respect to any Purchased Mortgage Loan at any time, any
principal thereof then payable and all interest, dividends or other distributions payable thereon
and (b) with respect to any REO Property during any period, any rental payments and all proceeds of
the REO Property received upon liquidation of such REO Property during such period.

“Indebtedness” shall mean, with respect to any Person, (a) obligations created, issued
or incurred by such Person for borrowed money (whether by loan, the issuance and sale of debt
securities or the sale of Property to another Person subject to an understanding or agreement,
contingent or otherwise, to repurchase such Property from such Person); (b) obligations of such
Person to pay the deferred purchase or acquisition price of Property or services, other than trade
accounts payable (other than for borrowed money) arising, and accrued expenses incurred, in the
ordinary course of business, so long as such trade accounts payable are payable within 90 days of
the date the respective goods are delivered or the respective services are rendered;
(c) Indebtedness of others secured by a Lien on the Property of such Person, whether or not the
respective Indebtedness so secured has been assumed by such Person; (d) obligations (contingent or
otherwise) of such Person in respect of letters of credit or similar instruments issued or accepted
by banks and other financial institutions for the account of such Person; (e) Capital Lease
Obligations of such Person; (f) obligations of such Person under loan agreements, warehouse finance
agreements, repurchase agreements, sale/buy-back agreements or like arrangements (but excluding any
such obligations to the Buyer or any of its Affiliates); (g) Indebtedness of others Guaranteed by
such Person; (h) all obligations of such Person incurred in connection with the acquisition or
carrying of fixed assets by such Person; and (i) Indebtedness of general partnerships of which such
Person is a general partner.

“Indemnified Party” shall have the meaning specified in Section 15 hereof.

“Independent Accounting Firm” shall mean an independent accounting firm of recognized
national standing with the American Institute of Certified Public Accountants or such other
independent certified public accountants approved by the Buyer (which approval shall not be
unreasonably withheld or delayed).

“Interest Rate Protection Agreement” shall mean, with respect to any or all of the
Purchased Assets, any short sale of a U.S. Treasury Security, or futures contract, or mortgage
related security, or Eurodollar futures contract, or options related contract, or interest rate
swap, cap or collar agreement or Take-out Commitment, or similar arrangement providing for
protection against fluctuations in interest rates or the exchange of nominal interest obligations,
either generally or under specific contingencies, entered into by a Seller and an Affiliate of the
Buyer, and acceptable to the Buyer.

“Jumbo Mortgage Loan” shall mean a first lien Mortgage Loan with a principal balance
of not more than $2,000,000 that (a) except with respect to the original principal balance thereof,
conforms to the requirements for securitization or cash purchase by an Agency or are eligible for
pool insurance by an insurer acceptable to the Buyer, and (b) that either (i) will be sold or
securitized by the Seller or (ii) is subject to Takeout Commitment.

“Land-and-Home Contract” shall mean a manufactured housing installment sales contract
and installment loan agreement that is secured by a Mortgage on real estate on which the related
Manufactured Home is situated, and which Manufactured Home is considered or classified as part of
the real estate under the laws of the jurisdiction in which it is located, including, without
limitation, all related security interests and any and all rights to receive payments which are due
pursuant thereto.

“Late Payment Fee” shall mean the excess of the Price Differential paid as a result of
its calculation at the Post-Default Rate over the Price Differential as would have been calculated
at the Pricing Rate.

“Law” shall mean, any law, treaty, rule or regulation or determination of an
arbitrator or court or other Governmental Authority, in each case applicable to or binding upon
such Person or any of its property or to which such Person or any of its property is subject.

“LIBOR Period” shall mean, with respect to each Payment Date, the period from and
including the immediately preceding Payment Date (or, with respect to the first LIBOR Period for
each Transaction, from and including the related Purchase Date) to, but excluding such Payment
Date, unless otherwise agreed to by the Buyer and the Sellers and set forth in the related
Confirmation.

“LIBOR Rate” shall mean, with respect to each day during the applicable LIBOR Period,
the rate per annum equal to the one month British Bankers Association Rate as reported on the
display designated as “BBAM” “Page DG8 4a” on Bloomberg (or such other display as may replace
“BBAM” “Page DG8 4a” on Bloomberg), as of 8:00 a.m., New York City time, on the date two Business
Days prior to the commencement of such LIBOR Period, and if such rate shall not be so quoted, or if
the related LIBOR Period shall be less than one month, the rate per annum at which the Buyer or its
Affiliate is offered dollar deposits at or about 8:00 a.m., New York City time, on the date two
Business Days prior to the commencement of the such LIBOR Period, by prime banks in the interbank
Eurodollar market where the Eurodollar and foreign currency exchange operations in respect of its
Transactions are then being conducted for delivery on such day for a period of one month or such
other period as agreed upon in writing by the Buyer and the applicable Seller and in an amount
comparable to the amount of the related Transactions outstanding on such day.

“Lien” shall mean any lien, claim, charge, restriction, pledge, security interest,
mortgage, deed of trust or other encumbrance.

“Loan to Value Ratio” or “LTV” shall mean with respect to any Mortgage Loan,
the ratio of the original outstanding principal amount of such Mortgage Loan to the lesser of
(a) the Appraised Value of the Mortgaged Property at origination or (b) if the Mortgaged Property
was purchased within twelve (12) months of the origination of such Mortgage Loan, the purchase
price of the Mortgaged Property.

“Low Purchase Price Mortgage Loan” shall mean a Purchased Asset designated as a Low
Purchase Price Mortgage Loan by Seller in accordance with Section 3.

“Manufactured Home” shall mean a unit of manufactured housing, including all
accessions thereto, securing the indebtedness of the Mortgagor under the related Land-and-Home
Contract.

“Margin Call” shall have the meaning specified in Section 4.

“Margin Deficit” shall have the meaning specified in Section 4.

“Market Value” shall mean, as of any date with respect to any Purchased Asset, the
price at which such Mortgage Loan or REO Property could readily be sold as determined by the Buyer
in its reasonable sole discretion.

“Material Adverse Effect” shall mean (a) a material adverse change in, or a material
adverse effect upon, the operations, business, Property, condition (financial or otherwise) or
prospects of the Sellers, taken as a whole, (b) a material impairment of the ability of any of the
Sellers to perform under any of the Repurchase Documents to which it is a party, or (c) a material
adverse effect upon the legality, validity, binding effect or enforceability of any of the
Repurchase Documents.

“Maximum Purchase Price” shall mean $400,000,000.

“MERS” shall mean Mortgage Electronic Registration Systems, Inc., a corporation
organized and existing under the laws of the State of Delaware, or any successor thereto.

“MERS System” shall mean the system of recording transfers of mortgages electronically
maintained by MERS.

“Minimum Purchase Price” shall mean $2,000,000.

“Monthly Payment” shall mean the scheduled monthly payment of principal and interest
on a Mortgage Loan.

“Moody’s” shall mean Moody’s Investor’s Service, Inc., or any successors thereto.

“Mortgage” shall mean each mortgage, assignment of rents, security agreement and
fixture filing, or deed of trust, assignment of rents, security agreement and fixture filing, deed
to secure debt, assignment of rents, security agreement and fixture filing, or similar instrument
creating and evidencing a first lien or second lien on real property and other property and rights
incidental thereto.

“Mortgage Interest Rate” shall mean the rate of interest borne on a Mortgage Loan from
time to time in accordance with the terms of the related Mortgage Note.

“Mortgage Loan” shall mean any first or second lien, single family residential
mortgage loan evidenced by a Mortgage Note and secured by a Mortgage or any Land-and-Home Contract,
which mortgage loan or Land-and-Home Contract is subject to a Transaction hereunder, which in no
event shall include any mortgage loan or Land-and-Home Contract which (a) is subject to
Section 226.32 of Regulation Z or any similar state law (relating to high interest rate
credit/lending transactions), (b) includes any single premium credit life or accident and health
insurance or disability insurance, (c) contains any term or condition, or involves any loan
origination practice, that has been defined as “predatory,” “covered” or “threshold” under
applicable federal, state or local law, or which has been expressly categorized as an “unfair” or
“deceptive” term, condition, or practice in any applicable federal, state or local law dealing with
“predatory” or “high cost” mortgage lending (or a similarly classified loan using different
terminology under a law, regulation or ordinance imposing heightened regulatory scrutiny or
additional legal liability for residential mortgage loans having high interest rates, points and/or
fees) or (d) with respect to any Land-and-Home Contract, the related Manufactured Home is not
qualified to back a “mortgage related security” as defined in Section 3(a)(41) of the Securities
Exchange Act of 1934, as amended.

“Mortgage Loan in Foreclosure” shall mean a Mortgage Loan in the process of
Foreclosure.

“Mortgage Note” shall mean the promissory note or other evidence of the indebtedness
of a Mortgagor secured by a Mortgage.

“Mortgaged Property” shall mean the real property securing repayment of the debt
evidenced by a Mortgage Note.

“Mortgagor” shall mean the obligor or obligors on a Mortgage Note, including any
Person who has assumed or guaranteed the obligations of the obligor thereunder.

“Multiemployer Plan” shall mean, with respect to any Person, a “multiemployer plan” as
defined in Section 4001(a)(3) of ERISA which is or was at any time during the current year or the
immediately preceding five (5) years contributed to by such Person or any ERISA Affiliate thereof
on behalf of its employees and which is covered by Title IV of ERISA.

“Non-Excluded Taxes” shall have the meaning set forth in Section 7(a) hereof.

“Non-Exempt Buyer” shall have the meaning specified in Section 7(f) hereof.

“Non-Performing Mortgage Loan” shall mean, a Mortgage Loan which has been repurchased
by the Seller as part of a clean-up call invoked in connection with a securitization for which as
of the date of determination any Monthly Payment is 90 days or more past due.

“Non-Utilization Fee” shall mean, for each calendar quarter, an amount equal to the
product of (a) 0.125% per annum and (b) the excess of (i) 50% of the Maximum Purchase Price over
(ii) the average daily aggregate outstanding Purchase Price of the Purchased Assets during such
calendar quarter.

“Obligations” shall mean (a) any amounts due and payable by a Seller to the Buyer in
connection with a Transaction hereunder, together with interest thereon (including interest which
would be payable as post-petition interest in connection with any bankruptcy or similar proceeding)
and all other fees or expenses which are payable hereunder or under any of the Repurchase Documents
and (b) for so long as the amounts and obligations referenced in clause (a) of this definition are
outstanding, all other obligations or amounts due and payable by a Seller to the Buyer or an
Affiliate of the Buyer under any other contract or agreement.

“Origination Date” shall mean, with respect to each Mortgage Loan, the date of funding
of the related Mortgage Note or Land-and-Home Contract.

“Other Taxes” shall have the meaning set forth in Section 7(b) hereof.

“Payment Date” shall mean the first day of each month, or if such date is not a
Business Day, the last Business Day of the preceding month.

“PBGC” shall mean the Pension Benefit Guaranty Corporation or any entity succeeding to
any or all of its functions under ERISA.

“Performing Mortgage Loan” shall mean, a first or second lien, fixed or adjustable
rate Mortgage Loan which has been repurchased by the Seller as part of a clean-up call invoked in
connection with a securitization for which as of the date of determination has a Cash Flow Velocity
of 1.00.

“Periodic Advance Repurchase Payment” shall have the meaning specified in
Section 5(a).

“Person” shall mean any individual, corporation, company, voluntary association,
partnership, joint venture, limited liability company, trust, unincorporated association or
government (or any agency, instrumentality or political subdivision thereof).

“Plan” shall mean, with respect to any Person, any employee benefit or similar plan
that is or was at any time during the current year or immediately preceding five (5) years
established or maintained by such Person or any ERISA Affiliate thereof and that is covered by
Title IV of ERISA, other than a Multiemployer Plan.

“PMI Policy” shall mean a policy of primary mortgage guaranty insurance issued by a
Qualified Insurer, as required by this Repurchase Agreement with respect to certain Mortgage Loans.

“Post-Default Rate” shall mean a rate equal to the sum of (a) the Pricing Rate plus
(b) two percent (2.00%).

“Price Differential” shall mean, with respect to any Transaction hereunder as of any
date, the aggregate amount obtained by daily application of the Pricing Rate (or, during the
continuation of an Event of Default, by daily application of the Post-Default 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 Repurchase Date (reduced by any amount of such Price
Differential previously paid by a Seller to the Buyer with respect to such Transaction).

“Pricing Rate” shall mean a rate per annum equal to the sum of (a) the LIBOR Rate plus
(b) the Pricing Spread.

“Pricing Spread” shall mean:

(a) with respect to Transactions the subject of which are High Purchase Price Mortgage Loans
which are:

(i) Mortgage Loans other than Wet-Ink Mortgage Loans, Re-Performing Mortgage Loans,
Sub-Performing Mortgage Loans, Non-Performing Mortgage Loans or Mortgage Loans in Foreclosure,
0.80%; or

(ii) Wet-Ink Mortgage Loans, 1.125%.

(b) with respect to Transactions the subject of which are Low Purchase Price Mortgage Loans
which are:

(i) Mortgage Loans other than Wet-Ink Mortgage Loans, Re-Performing Mortgage Loans,
Sub-Performing Mortgage Loans, Non-Performing Mortgage Loans or Mortgage Loans in Foreclosure,
0.625%; or

(ii) Wet-Ink Mortgage Loans, 1.00%;

(c) with respect to Transactions the subject of which are Re-Performing Mortgage Loans,
0.90%;

(d) with respect to Transactions the subject of which are Sub-Performing Mortgage
Loans, 1.375%;

(e) with respect to Transactions the subject of which are Non-Performing Mortgage
Loans, 1.75%;

(f) with respect to Transactions the subject of which are Mortgage Loans in
Foreclosure, 2.00%; and

(g) with respect to Transactions the subject of which are REO Properties, 2.00%.

In no event shall the following Mortgage Loans be considered High Purchase Price Mortgage
Loans or Low Purchase Price Mortgage Loans: Re-Performing Mortgage Loans, Sub-Performing Mortgage
Loans, Non-Performing Mortgage Loans, REO Properties or Mortgage Loans in Foreclosure. Such
Mortgage Loans shall be excluded from Sellers’ election under Section 3(c).

“Property” shall mean any right or interest in or to property of any kind whatsoever,
whether real, personal or mixed and whether tangible or intangible.

“Purchase Date” shall mean the date on which Purchased Assets are transferred by a
Seller to the Buyer or its designee.

“Purchase Price” shall mean:

(a) on the Purchase Date, the Asset Value on such date; and

(b) thereafter, except where the Buyer and a Seller agree otherwise, such Purchase Price
decreased by the amount of any cash, Income and Periodic Advance Repurchase Payments actually
received by the Buyer pursuant to Section 5 or applied to reduce a Seller’s obligations under
Section 4(b) hereof.

“Purchase Price Percentage” shall mean:

(a) in the case of Mortgage Loans, that are High Purchase Price Mortgage Loans, the following
percentage, as applicable:

(i) with respect to each Mortgage Loan which is a Wet-Ink Mortgage Loan (other than a
Conforming Mortgage Loan or Jumbo Mortgage Loan, that, in either case, is a Wet-Ink Mortgage
Loan), 93%;

(ii) with respect to each Mortgage Loan which is a Wet-Ink Mortgage Loan that is either
a Conforming Mortgage Loan or Jumbo Mortgage Loan, 95%;

(iii) with respect to each Mortgage Loan (other than a Conforming Mortgage Loan, Jumbo
Mortgage Loan, Wet-Ink Mortgage Loan, Re-Performing Mortgage Loan, Sub-Performing Mortgage
Loan, Non-Performing Mortgage Loan or Mortgage Loan in Foreclosure), 97%; and

(iv) with respect to each Mortgage Loan which is a Conforming Mortgage Loan or a Jumbo
Mortgage Loan (other than a Wet-Ink Mortgage Loan, Re-Performing Mortgage Loan,
Sub-Performing Mortgage Loan, Non-Performing Mortgage Loan or Mortgage Loan in Foreclosure),
98%.

(b) in the case of Mortgage Loans, that are Low Purchase Price Mortgage Loans, the following
percentage, as applicable:

(i) with respect to each Mortgage Loan which is a Wet-Ink Mortgage Loan (other than a
Conforming Mortgage Loan or Jumbo Mortgage Loan, that, in either case, is a Wet-Ink Mortgage
Loan), 91%;

(ii) with respect to each Mortgage Loan which is a Wet-Ink Mortgage Loan that is either
a Conforming Mortgage Loan or Jumbo Mortgage Loan, 93%;

(iii) with respect to each Mortgage Loan (other than a Conforming Mortgage Loan, Jumbo
Mortgage Loan, Wet-Ink Mortgage Loan, Re-Performing Mortgage Loan, Sub-Performing Mortgage
Loan, Non-Performing Mortgage Loan or Mortgage Loan in Foreclosure), 95%; and

(iv) with respect to each Mortgage Loan which is a Conforming Mortgage Loan or a Jumbo
Mortgage Loan (other than a Wet-Ink Mortgage Loan, Re-Performing Mortgage Loan,
Sub-Performing Mortgage Loan, Non-Performing Mortgage Loan or Mortgage Loan in Foreclosure),
96%.”

(c) with respect to each Mortgage Loan which is a Mortgage Loan in Foreclosure, 80%.

(d) with respect to each REO Property, 80%.

(e) with respect to each Mortgage Loan which is a Non-Performing Mortgage Loan, 85%.

(f) with respect to each Mortgage Loan which is a Sub-Performing Mortgage Loan, 90%.

(g) with respect to each Mortgage Loan which is a Re-Performing Mortgage Loan, 90%.

In no event shall the following Mortgage Loans be considered High Purchase Price Mortgage
Loans or Low Purchase Price Mortgage Loans: Re-Performing Mortgage Loans, Sub-Performing Mortgage
Loans, Non-Performing Mortgage Loans, REO Properties or Mortgage Loans in Foreclosure. Such
Mortgage Loans shall be excluded from Sellers’ election under Section 3(c).

“Purchased Asset” shall mean a Mortgage Loan or REO Property and any Additional
Purchased Asset as evidenced by a Confirmation and a Trust Receipt.

“Purchased Asset Report” shall mean a report, delivered with each Transaction Request,
on the last day of each month (or if such date is not a Business Day, the next preceding Business
Day), or upon the request of the Buyer, including an Asset Schedule in the form of
Exhibit V hereto, setting forth information with respect to the Purchased Assets (and
Mortgage Loans and REO Properties proposed to be the subject of a Transaction on the related
Purchase Date, if applicable).

“Purchased Mortgage Loans” shall mean a Purchased Asset that is a Mortgage Loan.

“Qualified Insurer” shall mean a mortgage guaranty insurance company duly authorized
and licensed where required by law to transact mortgage guaranty insurance business and acceptable
under the Underwriting Guidelines.

“Rating Agency” shall mean any of S&P, Moody’s or Fitch.

“Records” shall mean all instruments, agreements and other books, records, and reports
and data generated by other media for the storage of information maintained by a Seller or any
other person or entity with respect to a Purchased Asset. Records shall include the Mortgage
Notes, any Mortgages, the Asset Files, the credit files related to the Purchased Asset and any
other instruments necessary to document or service a Purchased Asset.

“Register” shall have the meaning specified in Section 21 hereof.

“Regulations T, U and X” shall mean Regulations T, U and X of the Board of Governors
of the Federal Reserve System (or any successor), as the same may be modified and supplemented and
in effect from time to time.

“REIT” shall mean a real estate investment trust, as defined in Section 856 of the
Code.

“REO Property” shall mean a Mortgaged Property acquired by a Seller as a result of the
liquidation of a Mortgage Loan.

“Re-Performing Mortgage Loan” shall mean, a first or second lien, fixed or adjustable
rate Mortgage Loan which has been repurchased by the Seller as part of a clean-up call invoked in
connection with a securitization for which as of the date of determination has a Cash Flow Velocity
of 0.75 or higher.

“Reportable Event” shall mean any of the events set forth in Section 4043(c) of ERISA,
other than those events as to which the thirty (30) day notice period is waived under subsections
        .21, .22, .24, .26, .27 or .28 of PBGC Reg. § 4043.

“Repurchase Agreement” shall mean this Master Repurchase Agreement between the Buyer
and the Sellers, dated as of the date hereof as the same may be further amended, supplemented or
otherwise modified in accordance with the terms hereof.

“Repurchase Assets” shall have the meaning provided in Section 8 hereof.

“Repurchase Date” shall mean the date on which a Seller is to repurchase the Purchased
Assets subject to a Transaction from the Buyer as specified in the related Confirmation, or if not
so specified on a date requested pursuant to Section 3(d) or on the Termination Date, including any
date determined by application of the provisions of Sections 3 or 14, or the date identified to the
Buyer by a Seller as the date that the related Mortgage Loan is to be sold pursuant to a Take-out
Commitment.

“Repurchase Documents” shall mean this Repurchase Agreement, the Custodial Agreement,
the Electronic Tracking Agreement, a Servicer Notice, if any, the Settlement Account Control
Agreement and the Account Agreement.

“Repurchase Price” shall mean the price at which Purchased Assets are to be
transferred from the Buyer or its designee to a 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.

“Requirement of Law” shall mean as to any Person, the certificate of incorporation and
by-laws or other organizational or governing documents of such Person, and any law, treaty, rule or
regulation or determination of an arbitrator or a court or other Governmental Authority, in each
case applicable to or binding upon such Person or any of its property or to which such Person or
any of its Property is subject.

“Responsible Officer” shall mean an officer of the Sellers listed on Exhibit XI
hereto, as such Exhibit XI may be amended from time to time.

“Reset Date” shall mean the last day of the related LIBOR Period.

“S&P” shall mean Standard & Poor’s Ratings Services, or any successor thereto.

“SEC” shall mean the Securities Exchange Commission.

“Second Lien Mortgage Loan” shall mean a Mortgage Loan secured by a second lien on the
related Mortgaged Property.

“Section 7 Certificate” shall have the meaning specified in Section 7 (f)(ii) hereof.

“Seller” shall mean either FMC or FIC, as applicable.

“Seller Excluded Guarantees” shall mean (a) mortgage repurchase and warehouse
facilities whereby the Sellers are jointly and severally liable thereunder; (b) mortgage repurchase
and warehouse facilities, mortgage loan sale or purchase agreements, leases and third party vendor
agreements whereby FIC guarantees the obligations of its Subsidiaries thereunder; and (c)
obligations of the Seller pursuant to surety bonds required in connection with state licensing of
branch offices.

“Servicer” shall mean FMC or any successor or permitted assigns.

“Servicer Notice” shall mean the notice acknowledged by the Servicer substantially in
the form of Exhibit IX hereto.

“Servicing Agreement” shall mean any servicing agreement entered into among a Seller
and a Servicer, as the same may be amended from time to time.

“Settlement Account” shall have the meaning set forth in the Custodial Agreement.

“Settlement Account Control Agreement” shall mean the Settlement Account Control
Agreement entered into among the Buyer, the Sellers and the Custodian, dated as of the date hereof
as the same may be further amended, supplemented or otherwise modified in accordance with its
terms.

“Single-Employer Plan” shall mean a single-employer plan as defined in
Section 4001(a)(15) of ERISA which is subject to the provisions of Title IV of ERISA.

“Structured Securities Debt” shall mean any Indebtedness issued in connection with an
asset backed securitization transaction incurred by an Acceptable SPV, provided that (a) such
Indebtedness is non-recourse to any shareholder or equity owner of such Acceptable SPV, (b) such
indebtedness is publicly issued Indebtedness of the Acceptable SPV and (c) such Indebtedness is
rated by at least one (1) Rating Agency.

“Sub-Performing Mortgage Loan” shall mean, a Mortgage Loan which has been repurchased
by the Seller as part of a clean-up call invoked in connection with a securitization for which as
of the date of determination (a) has a Cash Flow Velocity of less than 0.75 and (b) for which any
Monthly Payment is less than ninety (90) days past due.

“Subsidiary” shall mean, with respect to any Person, any corporation, partnership or
other entity of which at least a majority of the securities or other ownership interests having by
the terms thereof ordinary voting power to elect a majority of the board of directors or other
persons performing similar functions of such corporation, partnership or other entity (irrespective
of whether or not at the time securities or other ownership interests of any other class or classes
of such corporation, partnership or other entity shall have or might have voting power by reason of
the happening of any contingency) is at the time directly or indirectly owned or controlled by such
Person or one or more Subsidiaries of such Person or by such Person and one or more Subsidiaries of
such Person.

“Sub-Prime Mortgage Loan” shall mean a first lien Mortgage Loan originated in
accordance with the Underwriting Guidelines for sub-prime mortgage loans, acceptable to the Buyer
in its sole discretion

“Takeout Commitment” shall mean a commitment of a Seller to sell one or more Mortgage
Loans to a Takeout Investor, and the corresponding Takeout Investor’s commitment back to Seller to
effectuate the foregoing.

“Takeout Investor” shall mean any institution which has made a Takeout Commitment and
has been approved by the Buyer. The initial list of Takeout Investors is attached hereto as
Schedule 3, which schedule may be amended from time to time with the Buyer’s consent.

“Tangible Net Worth” shall mean, for any Person as of a particular date,

(a) all amounts which would be included under capital on a balance sheet of such Person at
such date, determined in accordance with GAAP, less

(b) (i) amounts owing to such Person from Affiliates, or from officers, employees,
shareholders or other Persons similarly affiliated with such Person, (ii) intangible assets and
(iii) deferred tax charge.

“Taxes” shall have the meaning set forth in Section 7(a) hereof.

“Termination Date” shall mean the date which is 364 days from the date hereof which
shall be October 30, 2007.

“Termination Event” shall have the meaning set forth in Section 13.02 hereof.

“Test Period” means any four (4) consecutive calendar months.

“Transaction” shall have the meaning specified in Section 1.

“Transaction Request” shall mean a request from a Seller to the Buyer to enter into a
Transaction.

“Trust Receipt” shall have the meaning set forth in the Custodial Agreement.

“Underwriting Guidelines” shall mean the underwriting guidelines of FMC, attached
hereto as Exhibit VII.

“Uniform Commercial Code” shall mean the Uniform Commercial Code as in effect from
time to time in the State of New York.

“VA” shall mean the U.S. Department of Veterans Affairs, an agency of the United
States of America, or any successor thereto including the Secretary of Veterans Affairs.

“VA Approved Lender” shall mean a lender which is approved by the VA to act as a
lender in connection with the origination of VA Loans.

“VA Loan” shall mean a Mortgage Loan which is subject of a VA Loan Guaranty Agreement
as evidenced by a VA Loan Guaranty Agreement, or a Mortgage Loan which is a vender loan sold by the
VA.

“VA Loan Guaranty Agreement” shall mean the obligation of the United States to pay a
specific percentage of a Mortgage Loan (subject to a maximum amount) upon default of the Mortgagor
pursuant to the Servicemen’s Readjustment Act, as amended.

“Wet-Ink Mortgage Loan” shall mean a closed and funded Mortgage Loan which either
Seller is selling to the Buyer and for which the Asset File has not been delivered to the
Custodian.

“Wet-Ink Trust Receipt” shall have the meaning set forth in the Custodial Agreement.

	 	 	SECTION 3. INITIATION; TERMINATION

(a) Conditions Precedent to Initial Transaction. The Buyer’s obligation to enter into
the initial Transaction hereunder is subject to the satisfaction, immediately prior to or
concurrently with the making of such Transaction, of the condition precedent that the Buyer shall
have received from the Seller any fees and expenses payable hereunder, and all of the following
documents, each of which shall be satisfactory to the Buyer and its counsel in form and substance:

(i) The following Repurchase Documents delivered to the Buyer:

(A) Repurchase Agreement. This Repurchase Agreement, duly executed by
the parties thereto;

(B) Custodial Agreement. The Custodial Agreement, duly executed by the
parties thereto;

(C) Account Agreement. An Account Agreement, duly executed by the
parties thereto in form and substance acceptable to the Buyer;

(D) Electronic Tracking Agreement. To the extent the Sellers are
selling Mortgage Loans which are registered on the MERS® System, an Electronic
Tracking Agreement entered into, duly executed and delivered by the parties thereto,
in full force and effect, free of any modification, breach or waiver;

(E) Settlement Account Control Agreement. With respect to each Seller,
the related Settlement Account Control Agreement, executed and delivered by a duly
authorized officer of each of the Buyer, such Seller and Custodian.

(ii) Opinions of Counsel. An opinion or opinions of outside counsel to the
Sellers, substantially in the form of Exhibit II.

(iii) Sellers Organizational Documents. With respect to each Seller, a
certificate of corporate existence of such Seller delivered to the Buyer prior to the
Effective Date (or if unavailable, as soon as available thereafter) and certified copies of
the certificate of incorporation and by-laws (or equivalent documents) of such Seller and of
all corporate or other authority for such Seller with respect to the execution, delivery and
performance of the Repurchase Documents and each other document to be delivered by such
Seller from time to time in connection herewith.

(iv) Security Interest. Evidence that all other actions necessary or, in the
opinion of the Buyer, desirable to perfect and protect the Buyer’s interest in the Purchased
Mortgage Loans and other Repurchase Assets have been taken, including, without limitation,
UCC searches and duly authorized and filed Uniform Commercial Code financing statements on
Form UCC-1.

(v) Underwriting Guidelines. A true and correct copy of the Underwriting
Guidelines certified by an officer of FMC.

(vi) Insurance. With respect to each Seller, evidence that such Seller has
added the Buyer as a loss payee under such Seller’s Fidelity Insurance.

(vii) Other Documents. Such other documents as the Buyer may reasonably
request, in form and substance reasonably acceptable to the Buyer.

(b) Conditions Precedent to All Transactions. Upon satisfaction of the conditions set
forth in Section 3(a), the Buyer shall enter into a Transaction with the related Seller; provided,
however, that the Buyer’s obligation to enter into each Transaction (including the initial
Transaction) is subject to the satisfaction of the following further conditions precedent, both
immediately prior to entering into such Transaction and also after giving effect thereto to the
intended use thereof:

(i) The Buyer shall have executed and delivered a Confirmation in accordance with the
procedures set forth in Section 3(c);

(ii) No Termination Event, Default or Event of Default shall have occurred and be
continuing under the Repurchase Documents;

(iii) Both immediately prior to the Transaction and also after giving effect thereto
and to the intended use thereof, the representations and warranties made by the related
Seller in Section 11 hereof, shall be true, correct and complete on and as of such Purchase
Date in all material respects with the same force and effect as if made on and as of such
date (or, if any such representation or warranty is expressly stated to have been made as of
a specific date, as of such specific date);

(iv) After giving effect to the requested Transaction, (A) the aggregate outstanding
Purchase Price for all Purchased Assets subject to then outstanding Transactions under this
Repurchase Agreement shall not exceed the Maximum Purchase Price and (B) the requested
Purchase Price shall be no less than the Minimum Purchase Price;

(v) After giving effect to the requested Transaction, the Asset Value of all Purchased
Assets exceeds the aggregate Purchase Price for such Transactions;

(vi) On or prior to 2 p.m. (New York Time) one (1) Business Day prior to the related
Purchase Date, the Seller shall have delivered to the Buyer (a) a Transaction Request, and
(b) a Purchased Asset Report;

(vii) With respect to Transactions the subject of which are Wet-Ink Mortgage Loans, by
3:00 p.m. (New York City time) on the related Purchase Date, the Buyer shall have received a
Wet-Ink Trust Receipt for each Wet-Ink Mortgage Loan with the related Asset Schedule
attached thereto;

(viii) The related Seller shall have delivered to the Custodian the Asset File with
respect to each Purchased Asset which is not a Wet-Ink Mortgage Loan and the Custodian shall
have issued a Trust Receipt with respect to each such Purchased Asset to the Buyer and (B)
with respect to each Wet-Ink Mortgage Loan, by no later than 1:00 p.m. (New York City time)
on the eighth Business Day following the applicable Purchase Date, the related Seller shall
deliver the Asset File to the Custodian;

(ix) The Buyer shall have received all fees and expenses of counsel to the Buyer as
contemplated by Sections 15(b) and 27 which amounts, at the Buyer’s option, may be withheld
from the proceeds remitted by the Buyer to the Sellers pursuant to any Transaction
hereunder;

(x) No event or events shall have occurred in the good faith determination of the Buyer
resulting in the effective absence of a “repo market” or comparable “lending market” for
financing debt obligations secured by securities or an event or events shall have occurred
resulting in the Buyer not being able to finance the Purchased Assets through the “repo
market” or “lending market” with traditional counterparties at rates which would have been
reasonable prior to the occurrence of such event or events; provided, that
the Buyer shall be obligated to enter into Transactions at such time as the “repo market” or
“lending market” resumes and provided, further, that if the Buyer shall
invoke the foregoing provision, the Buyer shall use reasonable efforts to ascertain a
Pricing Rate (which may be higher) at which the Buyer would be willing to enter into
Transactions notwithstanding the circumstances which gave rise to the Buyer invoking the
foregoing provision;

(xi) In the event that either Seller makes any material amendment or modification to
the Underwriting Guidelines, such Seller shall have promptly delivered notice of the amended
or modified Underwriting Guidelines to Buyer with appropriate access to such Underwriting
Guidelines. If the Buyer does not notify the Sellers of the Buyer’s disapproval within ten
(10) Business Days of the Buyer’s receipt of such notice (any such disapproval as determined
by Buyer in its sole good faith discretion), the proposed amendments or modifications shall
be deemed approved; and

(xii) Each Transaction Request delivered by the related Seller hereunder shall
constitute a certification by such Seller that all the conditions set forth in this
Section 3(b) (other than clause (x) hereof) have been satisfied (both as of the date of such
notice or request and as of the date of such purchase).

(xiii) FIC has satisfied all of the following asset or income tests:

(A) At the close of each taxable year, at least 75 percent of FIC’s gross
income consists of (i) “rents from real property” within the meaning of Section
856(c)(3)(A) of the Code, (ii) interest on obligations secured by mortgages on real
property or on interests in real property, within the meaning of Section
856(c)(3)(B) of the Code, (iii) gain from the sale or other disposition of real
property (including interests in real property and interests in mortgages on real
property) which is not property described in Section 1221(a)(1) of the Code, within
the meaning of Section 856(c)(3)(C) of the Code, (iv) dividends or other
distributions on, and gain (other than gain from “prohibited transactions” within
the meaning of Section 857(b)(6)(B)(iii) of the Code) from the sale or other
disposition of, transferable shares (or transferable certificates of beneficial
interest) in other qualifying REITs within the meaning of Section 856(d)(3)(D) of
the Code, and (v) amounts described in Sections 856(c)(3)(E) through 856(c)(3)(I) of
the Code.

(B) At the close of each taxable year, at least 95 percent of FIC’s gross
income consists of (i) the items of income described in paragraph (i) hereof (other
than those described in Section 856(c)(3)(I) of the Code), (ii) gain realized from
the sale or other disposition of stock or securities which are not property
described in Section 1221(a)(1) of the Code, (iii) interest, (iv) dividends, and (v)
income derived from payments to FIC on interest rate swap or cap agreements,
options, futures contracts, forward rate agreements and other similar financial
instruments entered into to reduce the interest rate risks with respect to any
indebtedness incurred or to be incurred to acquire or carry real estate assets, or
gain from the sale or other disposition of such an investment as described in
section 856(c)(5)(G), in each case within the meaning of Section 856(c)(2) of the
Code.

(C) At the close of each quarter of FIC’s taxable years, at least 75 percent of
the value of FIC’s total assets (as determined in accordance with Treasury
Regulations Section 1.856-2(d)) has consisted of and will consist of real estate
assets within the meaning of Sections 856(c)(4) and 856(c)(5)(B) of the Code, cash
and cash items (including receivables which arise in the ordinary course of FIC’s
operations, but not including receivables purchased from another person), and
Government securities.

(D) At the close of each quarter of each of FIC’s taxable years, (a) not more
than 25 percent of FIC’s total asset value will be represented by securities (other
than those described in paragraph (iii), (b) not more than 20 percent of FIC’s total
asset value will be represented by securities of one or more taxable REIT
subsidiaries, and (c) (i) not more than 5 percent of the value of FIC’s total assets
will be represented by securities of any one issuer (other than those described in
paragraph (iii) and securities of taxable REIT subsidiaries), and (ii) FIC will not
hold securities possessing more than 10 percent of the total voting power or value
of the outstanding securities of any one issuer (other than those described in
paragraph (iii), securities of taxable REIT subsidiaries, and securities of a
qualified REIT subsidiary within the meaning of Section 856(i) of the Code).

(c) Initiation; Confirmation.

(i) Each Seller shall deliver a Transaction Request to the Buyer on or prior to
2:00 p.m. on the date one (1) Business Day prior to entering into any Transaction. Such
Transaction Request shall include a Asset Schedule with respect to the Mortgage Loans to be
sold in such requested Transaction. The Buyer shall confirm the terms of each Transaction
by issuing a written confirmation to the related Seller promptly after the parties enter
into such Transaction in the form of Exhibit I attached hereto (a
“Confirmation”). Such Confirmation shall set forth (A) the Purchase Date, (B) the
Purchase Price, (C) the Repurchase Date, (D) the Pricing Rate applicable to the Transaction,
(E) the applicable Purchase Price Percentages, (F) the LIBOR Period and (G) additional terms
or conditions not inconsistent with this Repurchase Agreement.

(ii) The Repurchase Date for each Transaction shall not be later than the date which is
364 days after the related Purchase Date. The LIBOR Period for each Transaction shall be
one month, unless agreed to in writing by the Buyer.

(iii) Each Confirmation, together with this Repurchase Agreement, shall be conclusive
evidence of the terms of the Transaction(s) covered thereby unless objected to in writing by
the related Seller no more than three (3) Business Days after the date the Confirmation was
received by such Seller or unless a corrected Confirmation is sent by the Buyer. An
objection sent by such Seller must state specifically that the writing which is an
objection, must specify the provision(s) being objected to by such Seller, must set forth
such provision(s) in the manner that such Seller believes they should be stated, and must be
received by the Buyer no more than three (3) Business Days after the Confirmation was
received by such Seller.

(iv) Subject to the terms and conditions of this Repurchase Agreement, until the
Termination Date the Sellers may sell, repurchase and resell Eligible Assets hereunder.

(v) In no event shall a Transaction be entered into when the Repurchase Date for such
Transaction would be later than the Termination Date.

(vi) No later than 12:00 p.m., New York City time, one (1) Business Day prior to the
requested Purchase Date, the related Seller shall deliver to the Custodian the Mortgage Loan
File pertaining to each Eligible Asset (other than a Wet-Ink Mortgage Loan) to be purchased
by the Buyer.

(vii) Subject to the satisfaction of the provisions of this Section 3, the Purchase
Price will then be made available to the related Seller by the Buyer transferring, via wire
transfer, in the aggregate amount of such Purchase Price in funds immediately available. The
Buyer will use commercially reasonable efforts to initiate the wire transfer referred to
above by 2:00 p.m., New York City time.

(viii) Once per month during any calendar month, with respect to all requested
Transactions and all related Purchased Assets, Sellers shall designate all such Purchased
Assets as either Low Purchase Price Mortgage Loans or High Purchase Price Mortgage Loans.
In the event that Sellers fail to make such designation, the Purchase Price election set
forth above will not be available and all Purchased Assets in such calendar month shall be
treated as Low Purchase Price Mortgage Loans.

(ix) Once per month during any calendar month and with respect to all High Purchase
Price Mortgage Loans, Sellers may, by prior written notice to Buyer, elect to transfer cash
to the account of Buyer specified in Section 9; provided that such cash is sufficient to
cause the Purchase Price of such High Purchase Price Mortgage Loans recalculated to include
such cash, low enough to classify such High Purchase Price Mortgage Loans as Low Purchase
Price Mortgage Loans. Any amounts so transferred shall be allocated to all High Purchase
Price Mortgage Loans to effect such recalculation.

(d) Repurchase.

(i) Each Seller may repurchase Purchased Assets without penalty or premium, subject to
the last sentence of this Section 3(d)(i), on any date. The Repurchase Price payable for
the repurchase of any such Purchased Asset shall be reduced as provided in Section 5(a) or
4(d). If either Seller intends to make such a repurchase, such Seller shall give one (1)
Business Day’s prior written notice thereof to the Buyer, designating the Purchased Assets
to be repurchased. If such notice is given, the amount specified in such notice shall be
due and payable on the date specified therein, and, on receipt, such amount shall be applied
to the Repurchase Price for the designated Purchased Assets. If any Purchased Asset is
repurchased on any date other than the Reset Date for such Transaction, the related Seller
shall pay to the Buyer any amount required to compensate such Buyer for any additional
losses, costs or expenses which it may reasonably incur as a result of such repurchase,
including, without limitation, any loss, cost or expense incurred by reason of the
liquidation or reemployment of deposits or other funds acquired by the Buyer to fund or
maintain such Transaction.

(ii) Prior to an Event of Default, if any Purchased Asset is finally liquidated in the
ordinary course of servicing such Purchased Asset during any monthly period, (A) the
Repurchase Date for such Purchased Asset shall be the date of liquidation, (B) all proceeds
of such liquidation shall be held by Sellers and the Servicer, in trust for Buyer and shall
constitute the property of the Buyer, and (C) the Repurchase Price for such Purchased Asset
(including Price Differential through the date of payment) shall be paid to Buyer on the
first Business Day of the following month.

(iii) On the Repurchase Date, (A) termination of the Transaction will be effected by
reassignment to the related Seller or its designee of the Purchased Assets (and any Income
in respect thereof received by the Buyer not previously credited or transferred to, or
applied to the obligations of, such Seller pursuant to Section 5) against the simultaneous
transfer of the Repurchase Price to an account of the Buyer. Such Seller is obligated to
obtain the Asset Files from the Buyer or its designee at such Seller’s expense on the
Repurchase Date.

	 	 	SECTION 4. MARGIN AMOUNT MAINTENANCE

(a) The Buyer shall determine the Asset Value of the Purchased Assets on a weekly basis, or at
such intervals as determined by the Buyer in its sole discretion.

(b) If at any time the aggregate Asset Value of all related Purchased Assets subject to all
Transactions is less than the aggregate Purchase Price for all such Transactions (a “Margin
Deficit”), then the Buyer may by notice to the Sellers (as such notice is more particularly set
forth below, a “Margin Call”), require the Sellers to transfer to the Buyer or its designee
cash or Eligible Assets approved by the Buyer in its sole discretion (“Additional Purchased
Assets”) so that the aggregate Asset Value of the Purchased Assets, including any such cash or
Additional Purchased Assets or cash, will thereupon equal or exceed the aggregate Purchase Price
for all Transactions. If the Buyer delivers a Margin Call to the Sellers on or prior to 9:30 a.m.
(New York City time) on any Business Day, then the Sellers shall transfer cash or Additional
Purchased Assets to the Buyer no later than 5 p.m. (New York City time) that day. In the event the
Buyer delivers a Margin Call to the Sellers after 9:30 a.m. (New York City time) on any Business
Day, the Sellers shall be required to transfer cash or Additional Purchased Assets no later than
5:00 p.m. (New York City time) on the subsequent Business Day.

(c) The Buyer’s election, in its sole and absolute discretion, not to make a Margin Call at
any time there is a Margin Deficit shall not in any way limit or impair its right to make a Margin
Call at any time a Margin Deficit exists.

(d) Any cash transferred to the Buyer pursuant to Section 4(b) above shall be credited to the
Repurchase Price of the related Transactions.

(e) Notwithstanding anything to the contrary herein, if a Margin Deficit occurs with respect
to a Low Purchase Price Mortgage Loan, which, if considered to be a High Purchase Price Mortgage
Loan, would not cause a Margin Deficit to occur, then Sellers may transfer to Buyer cash in an
amount at least equal to the Margin Deficit, provided that such cash is sufficient to ensure such
Purchased Asset is fully compliant as a Low Purchase Price Mortgage Loan.

	 	 	SECTION 5. INCOME PAYMENTS

(a) Notwithstanding that the Buyer and the Sellers intend that the Transactions hereunder be
sales to the Buyer of the Purchased Assets, Sellers shall pay to the Buyer the accreted value of
the Price Differential (less any amount of such Price Differential previously paid by the Sellers
to the Buyer) plus the amount of any unpaid Margin Deficit (each such payment, a “Periodic
Advance Repurchase Payment”) on each Payment Date. Not later than 5:00 p.m. (New York City
time) one (1) Business Day prior to each Payment Date, the Buyer shall give the Sellers notice of
the amount of the Periodic Advance Repurchase Payment; provided, however, that failure of the Buyer
to give such notice shall not relieve the Sellers of their obligations to pay the Periodic Advance
Repurchase Payment. Notwithstanding the preceding sentence, if the Sellers fail to make all or
part of the Periodic Advance Repurchase Payment by 5:00 p.m. (New York City time) on any Payment
Date, the Pricing Rate shall be equal to the Post-Default Rate until the Periodic Advance
Repurchase Payment is received in full by the Buyer.

(b) The Sellers shall hold for the benefit of the Buyer all Income, including without
limitation all Income received by or on behalf of the Seller with respect to such Purchased Assets.
All Income shall be held for the Buyer and shall constitute the property of the Buyer. With
respect to each Payment Date, the Sellers shall remit all Income as follows:

(i) first, to the payment of all costs and fees payable by the Sellers pursuant to this
Repurchase Agreement;

(ii) second, to the Buyer in payment of any accrued and unpaid Price Differential;

(iii) third, without limiting the rights of the Buyer under Section 4 of this
Repurchase Agreement, to the Buyer, in the amount of any unpaid Margin Deficit;

(iv) fourth, any remaining amounts to the Sellers.

(c) Notwithstanding the foregoing, after the occurrence of an Event of Default, the Sellers
shall deposit such Income in a deposit account (the title of which shall indicate that the funds
therein are being held in trust for the Buyer) (the “Collection Account”) with a financial
institution acceptable to the Buyer and subject to the Account Agreement. All such Income shall be
held in trust for the Buyer, shall constitute the property of the Buyer and shall not be commingled
with other property of the Sellers or any Affiliate of the Sellers except as expressly permitted
above. Funds deposited in the Collection Account during any month shall be held therein, in trust
for the Buyer, until the next Payment Date. Notwithstanding the preceding provisions, if an Event
of Default has occurred, all funds in the Collection Account shall be withdrawn and applied as
determined by the Buyer and any remaining amounts to the Sellers.

(d) To the extent that the Buyer receives any funds from a Takeout Investor with respect to
the purchase by such Takeout Investor of a Mortgage Loan, the Buyer shall promptly apply such funds
in accordance with the same order of priority set forth in Section 5(b) hereof.

(e) The Buyer shall offset against the Repurchase Price of each such Transaction all Income
and Periodic Advance Repurchase Payments actually received by the Buyer pursuant to Section 5(a),
excluding any Late Payment Fees paid pursuant to any Periodic Advance Repurchase Payments made at
the Post-Default Rate pursuant to Section 5(a).

	 	 	SECTION 6. REQUIREMENTS OF LAW

(a) If any Requirement of Law (other than with respect to any amendment made to the Buyer’s
certificate of incorporation and by-laws or other organizational or governing documents) or any
change in the interpretation or application thereof or compliance by the Buyer with any request or
directive (whether or not having the force of law) from any central bank or other Governmental
Authority made subsequent to the date hereof:

(i) shall subject the Buyer to any Tax of any kind whatsoever with respect to this
Repurchase Agreement or any Transaction or change the basis of taxation of payments to the
Buyer in respect thereof;

(ii) shall impose, modify or hold applicable any reserve, special deposit, compulsory
loan or similar requirement against assets held by, deposits or other liabilities in or for
the account of, advances, or other extensions of credit by, or any other acquisition of
funds by, any office of the Buyer which is not otherwise included in the determination of
the LIBOR Rate hereunder;

(iii) shall impose on the Buyer any other condition;

and the result of any of the foregoing is to increase the cost to the Buyer, by an amount which the
Buyer deems to be material, of entering, continuing or maintaining any Transaction or to reduce any
amount due or owing hereunder in respect thereof, then, in any such case, the Sellers shall
promptly pay the Buyer such additional amount or amounts as calculated by the Buyer in good faith
as will compensate the Buyer for such increased cost or reduced amount receivable.

(b) If the Buyer shall have determined that the adoption of or any change in any Requirement
of Law (other than with respect to any amendment made to the Buyer’s certificate of incorporation
and by-laws or other organizational or governing documents) regarding capital adequacy or in the
interpretation or application thereof or compliance by the Buyer or any corporation controlling the
Buyer with any request or directive regarding capital adequacy (whether or not having the force of
law) from any Governmental Authority made subsequent to the date hereof shall have the effect of
reducing the rate of return on the Buyer’s or such corporation’s capital as a consequence of its
obligations hereunder to a level below that which the Buyer or such corporation could have achieved
but for such adoption, change or compliance (taking into consideration the Buyer’s or such
corporation’s policies with respect to capital adequacy) by an amount deemed by the Buyer to be
material, then from time to time, the Sellers shall promptly pay to the Buyer such additional
amount or amounts as will compensate the Buyer for such reduction.

(c) If the Buyer becomes entitled to claim any additional amounts pursuant to this Section, it
shall give prompt notice to the Sellers of the event by reason of which it has become so entitled
which notice shall show in reasonable detail (as determined by the Buyer) the basis for calculation
of such additional amounts. A certificate as to any additional amounts payable pursuant to this
Section submitted by the Buyer to the Sellers shall be conclusive in the absence of manifest error.

(d) Notwithstanding anything to the contrary, the Sellers shall not be under any obligation to
compensate the Buyer under this Section 6 with respect to any additional amounts the Buyer becomes
entitled to claim hereunder for any period prior to the date that is 180 days prior to a notice of
such claim if the Buyer knew or would reasonably have been expected to know of the circumstances
giving rise to such additional compensation and of the fact that such circumstances could
reasonably be expected to result in a claim for additional compensation by reason of such increased
cost, reduction in any amount due or owing hereunder or reduction of the rate of return as set
forth in this Section 6.

	 	 	SECTION 7. TAXES.

(a) Any and all payments by the Sellers under or in respect of this Repurchase Agreement or
any other Repurchase Documents to which the Sellers are a party shall be made free and clear of,
and without deduction or withholding for or on account of, any and all present or future taxes,
levies, imposts, deductions, charges or withholdings, and all liabilities (including penalties,
interest and additions to tax) with respect thereto, whether now or hereafter imposed, levied,
collected, withheld or assessed by any taxation authority or other Governmental Authority
(collectively, “Taxes”), unless required by law. If the Sellers shall be required under
any applicable Requirement of Law to deduct or withhold any Taxes from or in respect of any sum
payable under or in respect of this Repurchase Agreement or any of the other Repurchase Documents
to the Buyer, (i) the Sellers shall make all such deductions and withholdings in respect of Taxes,
(ii) the Sellers shall pay the full amount deducted or withheld in respect of Taxes to the relevant
taxation authority or other Governmental Authority in accordance with any applicable Requirement of
Law, and (iii) the sum payable by the Sellers shall be increased as may be necessary so that after
the Sellers have made all required deductions and withholdings (including deductions and
withholdings applicable to additional amounts payable under this Section 7) such Buyer receives an
amount equal to the sum it would have received had no such deductions or withholdings been made in
respect of Non-Excluded Taxes. For purposes of this Repurchase Agreement the term “Non-Excluded
Taxes” are Taxes other than, in the case of a Buyer, Taxes that are imposed on its overall net
income (and franchise taxes imposed in lieu thereof) by the United States or by the state or
foreign jurisdiction under the laws of which such Buyer is organized or of its principal office, or
any political subdivision thereof, unless such Taxes are imposed as a result of such Buyer having
executed, delivered or performed its obligations or received payments under, or enforced, this
Repurchase Agreement or any of the other Repurchase Documents (in which case such Taxes will be
treated as Non-Excluded Taxes).

(b) In addition, the Sellers hereby agree to pay any present or future stamp, recording,
documentary, excise, property or similar taxes, charges or levies that arise from any payment made
under or in respect of this Repurchase Agreement or any other Repurchase Document or from the
execution, delivery or registration of, any performance under, or otherwise with respect to, this
Repurchase Agreement or any other Repurchase Document (collectively, “Other Taxes”).

(c) The Sellers hereby agree to indemnify the Buyer for, and to hold it harmless against, the
full amount of Non-Excluded Taxes and Other Taxes, and the full amount of Taxes of any kind imposed
by any jurisdiction on amounts payable under this Section 7 imposed on or paid by such Buyer and
any liability (including penalties, additions to tax, interest and expenses) arising therefrom or
with respect thereto, provided that the Buyer shall have provided the Sellers with evidence of
payment of Non-Excluded Taxes or Other Taxes, as the case may be. The indemnity by Sellers
provided for in this Section 7(c) shall apply and be made whether or not the Non-Excluded Taxes or
Other Taxes for which indemnification hereunder is sought have been correctly or legally asserted.
Amounts payable by Sellers under the indemnity set forth in this Section 7(c) shall be paid within
10 days from the date on which the Buyer makes written demand therefor. If Buyer receives a tax
refund that is solely attributable to any Taxes as to which Buyer has been indemnified under this
Section 7(c), Buyer will pay to Seller (net of all out of pocket expenses) the amount that, in
Buyer’s sole discretion, are solely attributable to such Taxes.

(d) A Buyer pursuant to Section 7(a) shall take all reasonable actions (consistent with its
internal policy and legal and regulatory restrictions) requested by the Sellers to assist the
Sellers, as the case may be, at the sole expense of Sellers, to recover from the relevant taxation
authority or other Governmental Authority any Taxes in respect of which amounts were paid by the
Sellers pursuant to Sections 7(a), (b), or (c). However, a Buyer will not be required to take any
action that would be, in the sole judgment of a Buyer, legally inadvisable, or commercially or
otherwise disadvantageous to a Buyer in any respect, and in no event shall the Buyer be required to
disclose any tax returns or any other information that, in the sole judgment of the Buyer is
confidential.

(e) Within thirty (30) days after the date of any payment of Taxes, the Sellers (or any Person
making such payment on behalf of the Sellers) shall furnish to the Buyer for its own account or for
the account of the applicable Buyer, as the case may be, a certified copy of the original official
receipt evidencing payment thereof. In the case of any payment under or in respect of this
Repurchase Agreement or any of the other Repurchase Documents by or on behalf of the Sellers
through an account or branch outside the United States, or on behalf of the Sellers by a payor that
is not a United States person, if a Seller determines that no Taxes are payable in respect thereof,
Seller shall furnish, or shall cause such payor to furnish, to the Buyer an opinion of counsel
reasonably acceptable to the Buyer stating that such payment is exempt from Taxes. For purposes of
this Section 7(e) and subsection (f) of this Section 7, the terms “United States” and “United
States person” shall have the meanings specified in Section 7701 of the Internal Revenue Code.

(f) Each Buyer (including for avoidance of doubt any assignee, successor or participant) that
either (i) is not incorporated under the laws of the United States, any State thereof, or the
District of Columbia or (ii) whose name does not include “Incorporated,” “Inc.,” “Corporation,”
“Corp.,” “P.C.,” “insurance company,” or “assurance company” (a “Non-Exempt Buyer”) shall
deliver or cause to be delivered to Sellers the following properly completed and duly executed
documents:

(i) in the case of a Non-Exempt Buyer that is not a United States Person, a complete
and executed (x) U.S. Internal Revenue Form W-8BEN with Part II completed in which the Buyer
claims the benefits of a tax treaty with the United States providing for a zero or reduced
rate of withholding (or any successor forms thereto), including all appropriate attachments
or (y) a U.S. Internal Revenue Service Form W-8ECI (or any successor forms thereto); or

(ii) in the case of an individual, (x) a complete and executed U.S. Internal Revenue
Service Form W-8BEN (or any successor forms thereto) and a certificate substantially in the
form of Exhibit XII (a “Section 7 Certificate”) or (y) a complete and
executed U.S. Internal Revenue Service Form W-9 (or any successor forms thereto); or

(iii) in the case of a Non-Exempt Buyer that is organized under the laws of the United
States, any State thereof, or the District of Columbia, (x) a complete and executed U.S.
Internal Revenue Service Form W-9 (or any successor forms thereto), including all
appropriate attachments or (y) if such Non-Exempt Buyer is disregarded for federal income
tax purposes, the documents that would be required by clause (i), (ii), (iii), (iv), (v) or
(vi) with respect to its beneficial owner (as defined in clause (v)) if such beneficial
owner were the Buyer; or

(iv) in the case of a Non-Exempt Buyer that (i) is not organized under the laws of the
United States, any State thereof, or the District of Columbia and (ii) is treated as a
corporation for U.S. federal income tax purposes, a complete and executed U.S. Internal
Revenue Service Form W-8BEN claiming a zero rate of withholding (or any successor forms
thereto) and a Section 7 Certificate; or

(v) in the case of a Non-Exempt Buyer that (A) is treated as a partnership or other
non-corporate entity, and (B) is not organized under the laws of the United States, any
State thereof, or the District of Columbia, (x) a complete and executed Internal Revenue
Service Form W-8IMY (or any successor forms thereto) (including all required documents and
attachments) and (y)(i) a Section 7 Certificate, and (ii) without duplication, with respect
to each of its beneficial owners and the beneficial owners of such beneficial owners looking
through chains of owners to individuals or entities that are treated as corporations for
U.S. federal income tax purposes (all such owners, “beneficial owners”), the
documents that would be required by clause (i), (ii), (iii), (iv), this clause (v) and/or
clause (vi) with respect to each such beneficial owner if such beneficial owner were the
Buyer, provided, however, that no such documents will be required with respect to a
beneficial owner to the extent the actual Buyer is determined to be in compliance with the
requirements for certification on behalf of its beneficial owner as may be provided in
applicable U.S. Treasury regulations, or the requirements of this clause (v) are otherwise
determined to be unnecessary, all such determinations under this clause (v) to be made in
the sole discretion of Seller, provided, however, that the Buyer shall be provided an
opportunity to establish such compliance as reasonable; or

(vi) (A) in the case of a Non-Exempt Buyer that is disregarded for U.S. federal income
tax purposes, it shall provide the document that would be required by this clause (vi), or
clause (i), (ii), (iii), (iv), or (v) of this Section 7(f) with respect to its sole owner if
such sole owner were the Buyer, or (B) if such Non-Exempt Buyer is not a United States
person and is acting in the capacity as an “intermediary” (as defined in U.S. Treasury
Regulations), (1) a U.S. Internal Revenue Service Form W-8IMY (or any successor form
thereto) (including all required documents and attachments), and (2) if the intermediary is
a “non-qualified intermediary” (as defined in U.S. Treasury Regulations), from each person
upon whose behalf the “non-qualified intermediary” is acting the documents that would be
required by clause (i), (ii), (iii), (iv), (v) or (vi) with respect to each such person if
each such person were Buyer.

If the forms referred to above in this Section 7(f) that are provided by a Buyer at the time
such Buyer first becomes a party to this Repurchase Agreement or, with respect to a grant of a
participation, the effective date thereof, indicate a United States interest withholding tax rate
in excess of zero, withholding tax at such rate shall be treated as Taxes other than “Non-Excluded
Taxes” (“Excluded Taxes”) and shall not qualify as Non-Excluded Taxes unless and until such
Buyer provides the appropriate form certifying that a lesser rate applies, whereupon withholding
tax at such lesser rate shall be considered Excluded Taxes solely for the periods governed by such
form. If, however, on the date a Person becomes an assignee, successor or participant to this
Repurchase Agreement, the Buyer transferor was entitled to indemnification or additional amounts
under this Section 7, then the Buyer assignee, successor or participant shall be entitled to
indemnification or additional amounts to the extent (and only to the extent), that the Buyer
transferor was entitled to such indemnification or additional amounts for Non-Excluded Taxes, and
the Buyer assignee, successor or participant shall be entitled to additional indemnification or
additional amounts for any other or additional Non-Excluded Taxes. Any additional Taxes in respect
of a Buyer that result solely and directly from a change in the applicable lending office of such
Buyer shall be treated as Excluded Taxes (and shall not qualify as Non-Excluded Taxes) unless
(A) any such additional Taxes are imposed as a result of a change in the applicable Requirement of
Law, or in the interpretation or application thereof, occurring after the date of such change or
(B) such change is made at the request of the Seller for the Buyer to change its applicable lending
office.

(g) For any period with respect to which the Buyer has failed to provide a Seller with the
appropriate form, certificate or other document described in subsection (f) of this Section 7
(other than (i) if such failure is due to a change in any applicable Requirement of Law, or in the
interpretation or application thereof, occurring after the date on which a form, certificate or
other document originally was required to be provided, (ii) if such form, certificate or other
document otherwise is not required under subsection (f) of this Section 7, or (iii) if it is
legally inadvisable or otherwise commercially disadvantageous for such Buyer to deliver such form,
certificate or other document), such Buyer shall not be entitled to indemnification or additional
amounts under subsection (a) or (c) of this Section 7 with respect to Non-Excluded Taxes imposed by
the United States by reason of such failure; provided, however, that should a Buyer become subject
to Non-Excluded Taxes because of its failure to deliver a form, certificate or other document
required hereunder, such Seller shall take such steps as such Buyer shall reasonably request, at
the sole expense of such Buyer, to assist such Buyer in recovering such Non-Excluded Taxes.

(h) Buyer hereby agrees that, upon the occurrence of any circumstances entitling such Buyer to
indemnification or additional amounts pursuant to this Section 7, such Buyer shall use reasonable
efforts (consistent with its internal policy and legal and regulatory restrictions), at the sole
expense of the Sellers, to designate a different applicable lending office if the making of such a
change would avoid the need for, or materially reduce the amount of, any such indemnification or
additional amounts that may thereafter accrue and would not be, in the sole judgment of such Buyer,
legally inadvisable or commercially or otherwise disadvantageous to such Buyer in any respect.

(i) If any Buyer entitled to indemnification or additional amounts under any of the foregoing
provisions of this Section 7 shall fail to designate a different applicable lending office as
provided in subsection (h) of this Section 7, then, so long as no Event of Default shall have
occurred and be continuing, a Seller may cause such Buyer to (and, if such Seller so demands, such
Buyer shall) assign all of its rights and obligations under this Repurchase Agreement to one or
more other Persons identified by such Seller and reasonably acceptable to the Buyer; provided that
if, upon such demand by such Seller, such Buyer elects to waive its request for indemnification or
additional amounts pursuant to this Section 7, the demand by such Seller for such Buyer to so
assign all of its rights and obligations under this Repurchase Agreement shall thereupon be deemed
withdrawn. Nothing in subsection (h) of this Section 7 or this Section 7(i) shall affect or
postpone any of the rights of any Buyer or any of the Obligations of such Seller under any of the
foregoing provisions of this Section 7 in any manner.

(j) Without prejudice to the survival of any other agreement of the Sellers hereunder, the
agreements and obligations of the Sellers contained in this Section 7 shall survive the termination
of this Repurchase Agreement. Nothing contained in this Section 7 shall require the Buyer to make
available any of its tax returns or any other information that it deems to be confidential or
proprietary.

(k) Each party to this Repurchase Agreement acknowledges that it is its intent for purposes of
U.S. federal, state and local income and franchise taxes, to treat the Transaction as indebtedness
of the Sellers that is secured by the Purchased Assets and the Purchased Assets as owned by the
Sellers for federal income tax purposes in the absence of an Event of Default by the Sellers. All
parties to this Repurchase Agreement agree to such treatment and agree to take no action
inconsistent with this treatment, unless required by law.

	 	 	SECTION 8. SECURITY INTEREST

(a) Although the parties intend that all Transactions hereunder be sales and purchases (other
than for accounting and tax purposes) and not loans, in the event any such Transactions are deemed
to be loans, the Sellers hereby pledge to the Buyer as security for the performance by the Sellers
of their Obligations and hereby grant, assign and pledge to the Buyer a fully perfected first
priority security interest in and to the Seller’s right, title and interest in the Purchased
Assets, the Records, and all servicing rights related to the Purchased Assets, the Repurchase
Documents (to the extent such Repurchase Documents and the Sellers’ right thereunder relate to the
Purchased Assets), any Property relating to any Purchased Asset or the related Mortgaged Property,
any Takeout Commitments relating to any Purchased Mortgage Loans, all Settlement Accounts and all
amounts therein, all insurance policies and insurance proceeds relating to any Purchased Asset or
the related Mortgaged Property, including but not limited to any payments or proceeds under any
related primary insurance, hazard insurance, FHA Mortgage Insurance Contracts and VA Loan Guaranty
Agreements (if any), any Income relating to any Purchased Asset, the Collection Account, any
Interest Rate Protection Agreements relating to any Purchased Asset, and any other contract rights,
accounts (including any interest of the Sellers in escrow accounts), payments, rights to payment
(including payments of interest or finance charges) and general intangibles to the extent that the
forgoing relates to any Purchased Asset and any other assets relating to the Purchased Assets
(including, without limitation, any other accounts) or any interest in the Purchased Assets, all
collateral under any other secured debt facility (including, without limitation, any facility
documents as a repurchase agreement or similar purchase and sale agreement) between the Seller or
its Affiliates on the one hand and the Buyer or the Buyer’s Affiliates on the other (excluding any
syndicated credit facility in which a non-Affiliate of the Buyer is also a creditor), and any
proceeds (including the related securitization proceeds) and distributions and any other property,
rights, title or interests as are specified on a Trust Receipt and Asset Schedule and Exception
Report with respect to any of the foregoing, in all instances, whether now owned or hereafter
acquired, now existing or hereafter created (collectively, the “Repurchase Assets”)
provided, that no Default, Event of Default or Margin Deficit exists, the Buyer shall release its
security interest in the Purchased Assets upon payment in full to the Buyer of the Repurchase Price
with respect thereto. Nothing contained in this Repurchase Agreement shall obligate the Buyer to
segregate any Purchased Assets delivered to the Buyer by the related Seller. In the event that any
Purchased Mortgage Loan becomes an REO Property, such Seller shall promptly repurchase such
Purchased Mortgage Loan, and simultaneously convey a Buyer Deed, to Buyer in accordance with the
provisions below if such REO Property will be subject to a Transaction under this Repurchase
Agreement. The Sellers hereby authorize the Buyer to file such financing statement or statements
relating to the Repurchase Assets as the Buyer, at its option, may deem appropriate. The Sellers
shall pay the filing costs for any financing statement or statements prepared pursuant to this
Section 8. Upon termination of this Repurchase Agreement and payment by the Seller of the
Repurchase Price for all Purchased Assets and all other amounts due hereunder to the Buyer and the
performance of all obligations under the Repurchase Documents, the Buyer shall release its security
interest in any remaining Repurchase Assets.

(b) Provision of Buyer Deed.

(i) With respect to a REO Property, Sellers shall execute and deliver a Mortgage on the
REO Property in a form satisfactory to Buyer, in the name of Buyer or Buyer’s designee in
the jurisdiction in which the REO Property is located (each such Mortgage, a “Buyer
Deed”), and Buyer shall be deemed to have made a loan to Sellers in an amount equal to
the Purchase Price attributable to the REO Property. Such Buyer Deed shall be recorded by
the Seller at the sole expense of the Sellers. Sellers shall pay all mortgage taxes and
recording fees associated therewith.

(ii) If as a result of a Foreclosure, deed-in-lieu transaction or other action,
including, without limitation, a bankruptcy or similar action, a Purchased Asset becomes a
REO Property and Sellers takes title to such property, without any further action of any
party hereto, the Buyer shall be deemed to have made a loan to Seller in the full amount of
the unpaid Repurchase Price (including any accrued and unpaid Price Differential) and
Sellers shall immediately execute and deliver a Buyer Deed of the REO Property in a form
satisfactory to Buyer, in the name of the Buyer or other designee of Buyer in the
jurisdiction the REO Property is located. Such mortgage shall be recorded by the Sellers at
the sole expense of the Sellers. Sellers shall pay all mortgage taxes and recording fees
associated therewith.

(iii) In addition to the forgoing, with respect to each REO Property:

(A) Sellers shall provide to Buyer an assignment of leases and rents in form
satisfactory to Buyer, from Sellers to Buyer, or its designee, dated the date of
acquisition of such REO Property, which shall create a valid and perfected first
priority lien on, and security interest in, all leases and rents with respect to
such REO Property;

(B) Sellers shall provide to Buyer financing statements naming the Buyer, or
its designee, as secured party, and Sellers as debtors, and sufficient in number to
be filed with all public offices with which such financing statements are required
to be filed to create a first priority perfected security interest under the UCC in
the collateral described therein; and such other documents and instruments as Buyer
may reasonably require in order to obtain or perfect a first priority security
interest, and otherwise obtain and maintain its rights, in the applicable Property.

(C) each of the documents referred to in or delivered pursuant to the
provisions of this clause (iii) shall automatically be Repurchase Documents and be
cross-defaulted and cross-collateralized with this Agreement and the other
Repurchase Documents, without the requirement of further action.

(D) the documents referred to in or delivered pursuant to the provisions of
this clause (iii) shall have been duly recorded or filed in such manner and in such
places as is required by law to establish, preserve, protect and perfect the
interests and rights created or intended to be created by this Agreement or a Buyer
Deed and the other Repurchase Document referred to above, and all transfer and
mortgage recording taxes, fees and other charges in connection with the execution,
delivery and/or filing thereof shall have been duly paid by Seller.

(E) Buyer shall have received a mortgagee’s title insurance policy insuring the
Buyer Deed as a first priority lien on the applicable REO Property, subject to no
lien or encumbrance, in an amount equal to an amount allocated to such REO Property
by the Buyer from a title insurance company(ies) and otherwise in form and substance
reasonably satisfactory to Buyer.

(F) Sellers shall deliver to Buyer satisfactory certificates of insurance
evidencing that customary insurance has been obtained and is in full force and
effect with respect to any REO Property owned by Sellers.

	 	 	SECTION 9. PAYMENT, TRANSFER AND CUSTODY

(a) Unless otherwise mutually agreed in writing, all transfers of funds to be made by the
Sellers hereunder shall be made in Dollars, in immediately available funds, without deduction,
set-off or counterclaim, to the Buyer at the following account maintained by the Buyer:
        , not later than 5:00 p.m. New York City time, on
the date on which such payment shall become due (and each such payment made after such time shall
be deemed to have been made on the next succeeding Business Day). The Sellers acknowledge that
they have no rights of withdrawal from the foregoing account.

(b) On the Purchase Date for each Transaction, ownership of the Purchased Assets shall be
transferred to the Buyer or its designee against the simultaneous transfer of the Purchase Price to
the following account of the Sellers (or as otherwise directed by the Seller):
        . With respect to the Purchased
Assets being sold by a Seller on a Purchase Date, such Seller hereby sells, transfers, conveys and
assigns to the Buyer or its designee without recourse, but subject to the terms of this Repurchase
Agreement, all the right, title and interest of such Seller in and to the Purchased Assets together
with all right, title and interest in and to the proceeds of any related Repurchase Assets.

(c) In connection with such sale, transfer, conveyance and assignment, on or prior to each
Purchase Date, such Seller shall deliver or cause to be delivered and released to the Buyer or its
designee the Asset File for the related Purchased Assets.

	 	 	SECTION 10. HYPOTHECATION OR PLEDGE OF PURCHASED ASSET

Title to, and all of the related Seller’s interest in, the Purchased Assets shall pass to the
Buyer on the Purchase Date, provided that, unless otherwise agreed by the Buyer and the Seller,
absent an Event of Default, the Buyer shall not be permitted to sell, transfer, engage in a
repurchase transaction with, pledge or hypothecate the Purchased Assets. Notwithstanding the
foregoing, the Buyer shall be permitted to pledge, hypothecate or engage in repurchase transactions
with the Purchased Assets, so long as the transferee of such Purchased Assets is not, in turn,
permitted to transfer, pledge, hypothecate or rehypothecate such Purchased Assets absent an Event
of Default by Buyer; provided, that no such transaction shall relieve the Buyer of its obligations
to transfer Purchased Assets to the Sellers or their designee pursuant to Section 3(d) hereof.

	 	 	SECTION 11. REPRESENTATIONS

Each Seller represents and warrants, with respect to itself, to the Buyer that as of the
Purchase Date for any Purchased Assets purchased by the Buyer from such Seller and as of the date
of this Repurchase Agreement and any Transaction hereunder and at all times while the Repurchase
Documents and any Transaction hereunder is in full force and effect:

(a) Acting as Principal. The Seller will engage in such Transactions as principal
(or, if agreed in writing in advance of any Transaction by the other party hereto, as agent for a
disclosed principal).

(b) No Broker. The Seller has not dealt with any broker, investment banker, agent, or
other person, except for the Buyer, who may be entitled to any commission or compensation in
connection with the sale of Purchased Assets pursuant to this Repurchase Agreement.

(c) Financial Statements. FIC has heretofore furnished to the Buyer a copy of its
(a) consolidated balance sheet and the consolidated balance sheets of its consolidated Subsidiaries
for the fiscal year ended December 31, 2003 and the related consolidated statements of income and
retained earnings and of cash flows for the Seller and its consolidated Subsidiaries for such
fiscal year, setting forth in each case in comparative form the figures for the previous year, with
the opinion thereon of an Independent Accounting Firm and (b) consolidated balance sheet and the
consolidated balance sheets of its consolidated Subsidiaries for the quarterly fiscal period(s) of
the Seller ended March 31, 2004 and June 30, 2004 and the related consolidated statements of income
and retained earnings and of cash flows for the Seller and its consolidated Subsidiaries for such
quarterly fiscal period(s), setting forth in each case in comparative form the figures for the
previous year. All such financial statements are complete and correct and fairly present, in all
material respects, the consolidated financial condition of FIC and its Subsidiaries and the
consolidated results of their operations as at such dates and for such fiscal periods, all in
accordance with GAAP applied on a consistent basis. Since December 31, 2003, there has been no
material adverse change in the consolidated business, operations or financial condition of FIC and
its consolidated Subsidiaries taken as a whole from that set forth in said financial statements nor
is either Seller aware of any state of facts which (without notice or the lapse of time) would or
could result in any such material adverse change. Neither Seller has, on the date of the
statements delivered pursuant to this section (the “Statement Date”), any liabilities,
direct or indirect, fixed or contingent, matured or unmatured, known or unknown, or liabilities for
taxes, long-term leases or unusual forward or long-term commitments not disclosed by, or reserved
against in, said balance sheet and related statements, and at the present time there are no
material unrealized or anticipated losses from any loans, advances or other commitments of either
Seller except as heretofore disclosed to the Buyer in writing.

(d) Organization, Etc. The Seller is a corporation duly organized, validly existing
and in good standing under the laws of Maryland. The Seller (a) has all requisite corporate or
other power, and has all governmental licenses, authorizations, consents and approvals necessary to
own its assets and carry on its business as now being or as proposed to be conducted, except where
the lack of such licenses, authorizations, consents and approvals would not be reasonably likely to
have a Material Adverse Effect; (b) is qualified to do business and is in good standing in all
other jurisdictions in which the nature of the business conducted by it makes such qualification
necessary, except where failure so to qualify would not be reasonably likely to have a Material
Adverse Effect; and (c) has full power and authority to execute, deliver and perform its
obligations under the Repurchase Documents.

(e) Authorization, Compliance, Etc. The execution and delivery of, and the
performance by the Seller of its obligations under, the Repurchase Documents to which it is a party
(a) are within the Seller’s corporate powers, (b) have been duly authorized by all requisite
action, (c) do not violate any provision of applicable law, rule or regulation, or any order, writ,
injunction or decree of any court or other Governmental Authority, or its organizational documents,
(d) do not violate any indenture, agreement, document or instrument to which the Seller or any of
its Subsidiaries is a party, or by which any of them or any of their properties, any of the
Repurchase Assets is bound or to which any of them is subject and (e) are not in conflict with, do
not result in a breach of, or constitute (with due notice or lapse of time or both) a default
under, or except as may be provided by any Repurchase Document, result in the creation or
imposition of any Lien upon any of the property or assets of the Seller or any of its Subsidiaries
pursuant to, any such indenture, agreement, document or instrument. The Seller is not required to
obtain any consent, approval or authorization from, or to file any declaration or statement with,
any Governmental Authority in connection with or as a condition to the consummation of the
Transactions contemplated herein and the execution, delivery or performance of the Repurchase
Documents to which it is a party.

(f) Litigation. There are no actions, suits, arbitrations, investigations (including,
without limitation, any of the foregoing which are pending or threatened) or other legal or
arbitrable proceedings affecting the Seller or any of its Subsidiaries or affecting any of the
Repurchase Assets or any of the other properties of the Seller before any Governmental Authority
which (i) questions or challenges the validity or enforceability of the Repurchase Documents or any
action to be taken in connection with the transactions contemplated hereby or (ii) makes a claim or
claims that would reasonably be expected to have a Material Adverse Effect.

(g) Purchased Assets.

(i) The Seller has not assigned, pledged, or otherwise conveyed or encumbered any
Purchased Asset to any other Person, and immediately prior to the sale of such Mortgage Loan
to the Buyer, the Seller was the sole owner of such Purchased Asset and had good and
marketable title thereto, free and clear of all Liens, excluding Liens in favor of the
Buyer, in each case except for Liens to be released simultaneously with the sale to the
Buyer hereunder and Liens in favor of the Buyer.

(ii) The provisions of this Repurchase Agreement are effective to either constitute a
sale of Repurchase Assets to the Buyer or to create in favor of the Buyer a valid security
interest in all right, title and interest of the Seller in, to and under the Repurchase
Assets.

(h) Chief Executive Office/Jurisdiction of Organization. On the Effective Date, each
Seller’s chief executive office is, and has been, located at 11000 Broken Land Parkway, Suite 600,
Columbia, MD 21044. The Seller’s jurisdiction of organization is Maryland.

(i) Location of Books and Records. The location where the Seller keeps its books and
records, including all computer tapes and records related to the Repurchase Assets is its chief
executive office.

(j) Filing and Payment of Taxes.

(i) The Seller has timely filed all tax returns that are required to be filed by it and
has timely paid all Taxes, except for any such Taxes as are being appropriately contested in
good faith by appropriate proceedings diligently conducted and with respect to which
adequate reserves have been provided.

(ii) There are no Liens for Taxes, except for statutory liens for Taxes not yet due and
payable.

(k) Enforceability. This Repurchase Agreement and all of the other Repurchase
Documents executed and delivered by the Seller in connection herewith are legal, valid and binding
obligations of the Seller and are enforceable against the Seller in accordance with their terms
except as such enforceability may be limited by (i) the effect of any applicable bankruptcy,
insolvency, reorganization, moratorium or similar laws affecting creditors rights generally and
(ii) general principles of equity.

(l) Ability to Perform. The Seller does not believe, nor does it have any reason or
cause to believe, that it cannot perform each and every covenant contained in the Repurchase
Documents to which it is a party on its part to be performed.

(m) Material Adverse Effect. Since December 31, 2005, there has been no development
or event nor, to the Seller’s knowledge, any prospective development or event, which has had or
could reasonably be expected to have a Material Adverse Effect.

(n) No Default. No Default or Event of Default has occurred and is continuing.

(o) Underwriting Guidelines. The Underwriting Guidelines provided to the Buyer are
the true and correct Underwriting Guidelines.

(p) Adverse Selection. The Seller has not selected the Purchased Assets in a manner
intended to adversely affect the Buyer’s interests.

(q) Tangible Net Worth. On the initial Purchase Date, the Consolidated Tangible Net
Worth of FIC is not less than $250,000,000.

(r) Indebtedness. The Seller does not have any Indebtedness as of the date hereof,
except as disclosed on Schedule 2 to this Repurchase Agreement.

(s) Accurate and Complete Disclosure. The information, reports, financial statements,
exhibits and schedules furnished in writing by or on behalf of the Seller to the Buyer in
connection with the negotiation, preparation or delivery of this Repurchase Agreement and the other
Repurchase Documents or included herein or therein or delivered pursuant hereto or thereto, when
taken as a whole, do not contain any untrue statement of material fact or omit to state any
material fact necessary to make the statements herein or therein, in light of the circumstances
under which they were made, not misleading. All written information furnished after the date
hereof by or on behalf of the Seller to the Buyer in connection with this Repurchase Agreement and
the other Repurchase Documents and the transactions contemplated hereby and thereby will be true,
complete and accurate in every material respect, or (in the case of projections) based on
reasonable estimates, on the date as of which such information is stated or certified. There is no
fact known to the Seller, after due inquiry, that could reasonably be expected to have a Material
Adverse Effect that has not been disclosed herein, in the other Repurchase Documents or in a
report, financial statement, exhibit, schedule, disclosure letter or other writing furnished to the
Buyer for use in connection with the transactions contemplated hereby or thereby.

(t) Margin Regulations. The use of all funds acquired by the Seller under this
Repurchase Agreement will not conflict with or contravene any of Regulations T, U or X.

(u) Investment Company. Neither Seller nor any of their Subsidiaries is an
“investment company” or a company “controlled” by an “investment company” within the meaning of the
Investment Company Act of 1940, as amended.

(v) Solvency. As of the date hereof and immediately after giving effect to each
Transaction, the fair value of the assets of the Seller is greater than the fair value of the
liabilities (including, without limitation, contingent liabilities if and to the extent required to
be recorded as a liability on the financial statements of the Seller in accordance with GAAP) of
the Seller and the Seller is solvent and, after giving effect to the transactions contemplated by
this Repurchase Agreement and the other Repurchase Documents, will not be rendered insolvent or
left with an unreasonably small amount of capital with which to conduct its business and perform
its obligations. The Seller does not intend to incur, nor does it believe that it has incurred,
debts beyond its ability to pay such debts as they mature. The Seller is not contemplating the
commencement of an insolvency, bankruptcy, liquidation, or consolidation proceeding or the
appointment of a receiver, liquidator, conservator, trustee, or similar official in respect of
itself or any of its property.

(w) ERISA.

(i) No liability under Section 4062, 4063, 4064 or 4069 of ERISA has been or is
expected by the Seller to be incurred by the Seller or any ERISA Affiliate thereof with
respect to any Plan which is a Single-Employer Plan in an amount that could reasonably be
expected to have a Material Adverse Effect.

(ii) No Plan of the Seller which is a Single-Employer Plan had an accumulated funding
deficiency, whether or not waived, as of the last day of the most recent fiscal year of such
Plan ended prior to the date hereof. Neither the Seller nor any ERISA Affiliate thereof is
(i) required to give security to any Plan which is a Single-Employer Plan pursuant to
Section 401(a) (29) of the Code or Section 307 of ERISA, or (ii) subject to a Lien in favor
of such a Plan under Section 302(f) of ERISA.

(iii) Each Plan of the Seller, each of its Subsidiaries and each of its ERISA
Affiliates is in compliance in all material respects with the applicable provisions of ERISA
and the Code, except where the failure to comply would not result in any Material Adverse
Effect.

(iv) Neither the Seller nor any of its Subsidiaries has incurred a tax liability under
Section 4975 of the Code or a penalty under Section 502(i) of ERISA in respect of any Plan
which has not been paid in full, except where the incurrence of such tax or penalty would
not result in a Material Adverse Effect.

(v) Neither the Seller nor any of its Subsidiaries or any ERISA Affiliate thereof has
incurred or reasonably expects to incur any withdrawal liability under Section 4201 of ERISA
as a result of a complete or partial withdrawal from a Multiemployer Plan which will result
in withdrawal liability to the Seller, any of its Subsidiaries or any ERISA Affiliate
thereof in an amount that could reasonably be expected to have a Material Adverse Effect.

(x) Agency Approvals. FMC is an FHA Approved Mortgagee and a VA Approved Lender. FMC
is also approved by Fannie Mae as an approved lender and Freddie Mac as an approved
seller/servicer, and, to the extent necessary, approved by the Secretary of Housing and Urban
Development pursuant to Sections 203 and 211 of the National Housing Act. In each such case, the
Seller is in good standing, with no event having occurred or the Seller having any reason
whatsoever to believe or suspect will occur prior to the issuance of the consummation of the
related Takeout Commitment, as the case may be, including, without limitation, a change in
insurance coverage which would either make the Seller unable to comply with the eligibility
requirements for maintaining all such applicable approvals or require notification to the relevant
Agency or to the Department of Housing and Urban Development, FHA or VA. The Seller has adequate
financial standing, servicing facilities, procedures and experienced personnel necessary for the
sound servicing of mortgage loans of the same types as may from time to time constitute Mortgage
Loans and in accordance with Accepted Servicing Practices.

(y) Asset Schedule. The information set forth in the related Asset Schedule and all
other written information or data furnished by, or on behalf of, the Seller to the Buyer is
complete, true and correct in all material respects, and the Seller acknowledges that the Buyer has
not verified the accuracy of such information or data.

(z) No Reliance. The Seller has made its own independent decisions to enter into the
Repurchase Documents and each Transaction and as to whether such Transaction is appropriate and
proper for it based upon its own judgment and upon advice from such advisors (including without
limitation, legal counsel and accountants) as it has deemed necessary. The Seller is not relying
upon any advice from the Buyer as to any aspect of the Transactions, including without limitation,
the legal, accounting or tax treatment of such Transactions.

(aa) Plan Assets. The Seller is not an employee benefit plan as defined in Section 3
of Title I of ERISA, or a plan described in Section 4975(e)(1) of the Code, and the Purchased
Assets are not “plan assets” within the meaning of 29 CFR §2510.3-101 in the Seller’s hands.

(bb) Real Estate Investment Trust. FIC has not engaged in any material “prohibited
transactions” as defined in Section 857(b)(6)(B)(iii) and (C) of the Code. FIC for its current
“tax year” (as defined in the Code) is entitled to a dividends paid deduction under the
requirements of Section 857 of the Code with respect to any dividends paid by it with respect to
each such year for which it claims a deduction in its Form 1120-REIT filed with the United States
Internal Revenue Service for such year.

(cc) Mortgage Loans. No Purchased Asset was previously purchased under the MLMCI
Facility.

	 	 	SECTION 12. COVENANTS

On and as of the date of this Repurchase Agreement and each Purchase Date and until this
Repurchase Agreement is no longer in force with respect to any Transaction, each Seller covenants,
with respect to itself, as follows:

(a) Preservation of Existence; Compliance with Law. The Seller shall:

(i) Preserve and maintain its legal existence and all of its material rights,
privileges, licenses and franchises necessary for the operation of its business;

(ii) Comply, in all material respects, with the requirements of all applicable laws,
rules, regulations and orders, whether now in effect or hereafter enacted or promulgated by
any applicable Governmental Authority (including, without limitation, all environmental
laws);

(iii) Maintain all material licenses, permits or other approvals necessary for the
Seller to conduct its business and to perform its obligations under the Repurchase
Documents, and shall conduct its business strictly in accordance with applicable law;

(iv) Keep adequate records and books of account, in which complete entries will be made
in accordance with GAAP consistently applied; and

(v) Permit representatives of the Buyer, upon reasonable notice (unless an Event of
Default shall have occurred and is continuing, in which case, no prior notice shall be
required), during normal business hours, to examine, copy and make extracts from its books
and records, to inspect any of its Properties, and to discuss its business and affairs with
its officers, all to the extent reasonably requested by the Buyer, subject to the provisions
set forth in Section 27 hereof.

(b) Taxes, Etc. The Seller shall timely file all tax returns that are required to be
filed by it and shall timely pay all Taxes due, except for any such Taxes as are being
appropriately contested in good faith by appropriate proceedings diligently conducted and with
respect to which adequate reserves have been provided.

(c) Notice of Proceedings or Adverse Change. The Seller shall give notice to the
Buyer promptly after a Responsible Officer of the Seller has any knowledge of:

(i) the occurrence of any Default or Event of Default or Termination Event;

(ii) any (a) material default or event of default under any Indebtedness of the Seller
or (b)  Material Adverse Effect with respect to the Seller;

(iii) any litigation, investigation, regulatory action or proceeding that is pending or
threatened by or against the Seller (a) in any federal or state court or before any
Governmental Authority (in each case) would reasonably be expected to have a Material
Adverse Effect and (b) of any litigation or proceeding that is pending or threatened in
connection with any material portion of the Repurchase Assets, which, if adversely
determined, would reasonably be expected to have a Material Adverse Effect; and

(iv) promptly after a Responsible Officer of the Seller has any knowledge of any of the
following events:

(A) a material decrease in the amount or material reduction in the scope of
insurance coverage of the Seller, with a copy of evidence of same attached;

(B) any material change in accounting policies or financial reporting practices
of the Seller;

(C) upon receipt of notice or knowledge of any Lien or security interest (other
than security interests created hereby or under any other Repurchase Document) on,
or claim asserted against, a material portion of the Repurchase Assets; and

(D) any other event, circumstance or condition that has resulted, or would
reasonably be expected to have a Material Adverse Effect.

(d) Financial Reporting. The Seller shall maintain a system of accounting established
and administered in accordance with GAAP, and FIC shall furnish to the Buyer:

(i) Within one hundred twenty (120) days after the close of each fiscal year, Financial
Statements, including a statement of income and changes in shareholders’ equity of FIC for
such year, and the related balance sheet as at the end of such year, all in reasonable
detail and accompanied by an opinion of an accounting firm as to said financial statements;

(ii) Within forty-five (45) days after the close of each of FIC’s first three fiscal
quarters in each fiscal year unaudited balance sheets and income statements, for the period
from the beginning of such fiscal year to the end of such fiscal year, subject, however, to
year-end adjustments;

(iii) Within thirty (30) days after the end of each calendar month, the unaudited
balance sheets of FIC as at the end of such period and the related unaudited consolidated
statements of income and retained earnings and of cash flows for FIC for such period and the
portion of the fiscal year through the end of such period, subject, however, to year end
adjustments;

(iv) Simultaneously with the furnishing of each of the Financial Statements to be
delivered pursuant to subsection (ii) above, or monthly upon the Buyer’s request, a
certificate in the form of Exhibit VIII hereto and certified by an executive officer
of FIC; and

(v) Promptly, from time to time, such other information regarding the business affairs,
operations and financial condition of the Seller as the Buyer may reasonably request.

(e) Chief Executive Office; Jurisdiction of Organization. The Seller shall not move
its chief executive office from the address referred to in Section 6(h) or change its jurisdiction
of organization from the jurisdiction referred to in Section 6(h) unless it shall have provided the
Buyer thirty (30) days’ prior written notice of such change.

(f) Visitation and Inspection Rights. Subject to the provisions of Section 27, the
Seller shall permit the Buyer to inspect, and to discuss with the Seller’s officers, agents and
auditors, the affairs, finances, and accounts of the Seller, the Repurchase Assets, and the
Seller’s books and records, and to make abstracts or reproductions thereof and to duplicate, reduce
to hard copy or otherwise use any and all computer or electronically stored information or data, in
each case, (i) during normal business hours, (ii) upon reasonable notice (provided, that upon the
occurrence of an Event of Default, no notice shall be required), and (iii) at the expense of the
Seller to discuss with its officers, its affairs, finances, and accounts.

(g) Reimbursement of Expenses. On the date of execution of this Repurchase Agreement,
the Seller shall reimburse the Buyer for all reasonable out-of-pocket expenses incurred in
connection with the negotiations, preparation and execution hereof and the other Repurchase
Documents by the Buyer on or prior to such date. From and after such date, the Seller shall
promptly reimburse the Buyer for all reasonable out-of-pocket expenses as the same are incurred by
the Buyer and within thirty (30) days of the receipt of invoices therefor.

(h) Further Assurances. The Seller shall execute and deliver to the Buyer all further
documents, financing statements, agreements and instruments, and take all further action that may
be required under applicable law, or that the Buyer may reasonably request, in order to effectuate
the transactions contemplated by this Repurchase Agreement and the Repurchase Documents or, without
limiting any of the foregoing, to grant, preserve, protect and perfect the validity and
first-priority of the security interests created or intended to be created hereby. The Seller
shall do all things necessary to preserve the Repurchase Assets so that they remain subject to a
first priority perfected security interest hereunder. Without limiting the foregoing, the Seller
will comply with all rules, regulations, and other laws of any Governmental Authority and cause the
Repurchase Assets to comply with all applicable rules, regulations and other laws. The Seller will
not allow any default for which the Seller is responsible to occur under any Repurchase Assets or
any Repurchase Document and the Seller shall fully perform or cause to be performed when due all of
its obligations under any Repurchase Assets or the Repurchase Documents.

(i) True and Correct Information. All information, reports, exhibits, schedules,
financial statements or certificates of the Seller or any of its Affiliates thereof or any of their
officers furnished to the Buyer hereunder and during the Buyer’s diligence of the Seller are and
will be true and complete in all material respects and do not omit to disclose any material facts
necessary to make the statements therein or therein, in light of the circumstances in which they
are made, not misleading in all material respects. All required financial statements, information
and reports delivered by the Seller to the Buyer pursuant to this Repurchase Agreement shall be
prepared in accordance with GAAP, or if applicable, to SEC filings, the appropriate SEC accounting
requirements.

(j) ERISA Events.

(i) Promptly upon becoming aware of the occurrence of any Event of Termination which
together with all other Events of Termination occurring within the prior twelve (12) months
involve a payment of money by or a potential aggregate liability of the Seller or any ERISA
Affiliate thereof or any combination of such entities in excess of $10,000,000 the Seller
shall give the Buyer a written notice specifying the nature thereof, what action the Seller
or any ERISA Affiliate thereof has taken and, when known, any action taken or threatened by
the Internal Revenue Service, the Department of Labor or the PBGC with respect thereto;

(ii) Promptly upon receipt thereof, the Seller shall furnish to the Buyer copies of
(i) all notices received by the Seller or any ERISA Affiliate thereof of the PBGC’s intent
to terminate any Plan or to have a trustee appointed to administer any Plan; (ii) all
notices received by the Seller or any ERISA Affiliate thereof from the sponsor of a
Multiemployer Plan pursuant to Section 4202 of ERISA involving a withdrawal liability in
excess of $10,000,000; and (iii) all funding waiver requests filed by the Seller or any
ERISA Affiliate thereof with the Internal Revenue Service with respect to any Plan, the
accrued benefits of which exceed the present value of the plan assets as of the date the
waiver request is filed by more than $10,000,000, and all communications received by the
Seller or any ERISA Affiliate thereof from the Internal Revenue Service with respect to any
such funding waiver request.

(k) Financial Condition Covenants.

(i) Maintenance of Consolidated Tangible Net Worth. (A) FIC shall maintain a
Consolidated Tangible Net Worth of not less than $250,000,000, (B) FIC shall not experience
losses or changes in its financial condition (exclusive of amounts withdrawn for payment of
taxes due and payable by the shareholders of FIC) that cause its Consolidated Tangible Net
Worth for any two consecutive calendar quarters to be less than or equal to 80% of its
Consolidated Tangible Net Worth as of the commencement of such period.

(ii) Maintenance of Ratio of Indebtedness to Consolidated Tangible Net Worth.
FIC shall maintain the ratio of Indebtedness to Consolidated Tangible Net Worth no greater
than 17:1.

(l) Hedging. The Seller shall enter into and maintain Interest Rate Protection
Agreements in accordance with the Seller’s written policies regarding hedging, or a letter
detailing such policies to be delivered to the Buyer on or before the date hereof.

(m) No Adverse Selection. The Seller shall not select Eligible Assets to be sold to
the Buyer as Purchased Assets using any type of adverse selection or other selection criteria which
could be reasonably expected to adversely affect the Buyer.

(n) Insurance. The Seller shall continue to maintain Fidelity Insurance in an
aggregate amount acceptable to Fannie Mae and Freddie Mac. The Seller shall maintain a fidelity
bond in respect of its officers, employees and agents, with respect to any claims made in
connection with all or any portion of the Repurchase Assets. The Seller shall notify the Buyer of
any material change in the terms of any such fidelity bond or insurance policy.

(o) Books and Records. The Seller shall, to the extent practicable, maintain and
implement administrative and operating procedures (including, without limitation, an ability to
recreate records evidencing the Repurchase Assets in the event of the destruction of the originals
thereof), and keep and maintain or obtain, as and when required, all documents, books, records and
other information reasonably necessary or advisable for the collection of all Repurchase Assets.

(p) Security Interest. The Seller shall do all things necessary to preserve the
Repurchase Assets so that they remain subject to a first priority perfected security interest
hereunder. Without limiting the foregoing, the Seller will comply with all rules, regulations and
other laws of any Governmental Authority and cause the Repurchase Assets to comply with all
applicable rules, regulations and other laws. The Seller will not allow any default for which the
Seller is responsible to occur under any Repurchase Assets or any Repurchase Documents and the
Seller shall fully perform or cause to be performed when due all of its obligations under any
Repurchase Assets or the Repurchase Documents.

(q) Illegal Activities. The Seller shall not engage in any conduct or activity that
could subject its assets (other than nonmaterial portions thereof) to forfeiture or seizure.

(r) Material Change in Business. The Seller shall not make any material change in the
nature of its Business as conducted on the date hereof.

(s) Limitation on Dividends and Distributions. The Sellers shall not make any payment
on account of, or set apart assets for, a sinking or other analogous fund for the purchase,
redemption, defeasance, retirement or other acquisition of any equity interest of the Sellers,
whether now or hereafter outstanding, or make any other distribution in respect of any of the
foregoing or to any shareholder or equity owner of the Sellers, either directly or indirectly,
whether in cash or property or in obligations of the Sellers or any of the Sellers’ consolidated
Subsidiaries at any time following the occurrence and during the continuation of an Event of
Default.

(t) Disposition of Assets; Liens. The Seller shall not create, incur, assume or
suffer to exist any mortgage, pledge, Lien, charge or other encumbrance of any nature whatsoever on
any of the Repurchase Assets, whether real, personal or mixed, now or hereafter owned, other than
the Liens created in connection with the transactions contemplated by this Repurchase Agreement and
other Liens in favor of the Buyer or its Affiliates; nor shall the Seller cause any of the
Purchased Assets to be sold, pledged, assigned or transferred; provided, however, that this
Section 12(t) will cease to be effective upon any repurchase of the Purchased Assets by either
Seller or its designee from the Buyer in respect of Purchased Assets so repurchased.

(u) Transactions with Affiliates. The Seller shall not enter into any transaction in
the aggregate amount greater than $3,000,000, including, without limitation, the purchase, sale,
lease or exchange of property or assets or the rendering or accepting of any service with any
Affiliate, unless such transaction is (a) not otherwise prohibited in this Repurchase Agreement,
(b) in the ordinary course of the Seller’s Business and (c) upon fair and reasonable terms no less
favorable to the Seller, as the case may be, than it would obtain in a comparable arm’s length
transaction with a Person which is not an Affiliate; provided, however, this
Section 12(u) shall not apply to transactions (i) between the Sellers and (ii) transactions
relating to Structured Securities Debt.

(v) ERISA Matters.

(i) The Seller shall not permit any event or condition which is described in any of
clauses (i) through (vii) of the definition of “Event of Termination” to occur or exist with
respect to any Plan or Multiemployer Plan if such event or condition, together with all
other events or conditions described in the definition of Event of Termination occurring
within the prior twelve (12) months, involves the payment of money by or an incurrence of
liability of the Seller or any ERISA Affiliate thereof, or any combination of such entities
in an amount in excess of $10,000,000.

(ii) The Seller shall not be an employee benefit plan as defined in Section 3 of Title
I of ERISA, or a plan described in Section 4975(e)(1) of the Code and (b) the Seller shall
not use “plan assets” within the meaning of 29 CFR §2510.3-101 to engage in this Repurchase
Agreement or the Transactions hereunder.

(w) Consolidations, Mergers and Sales of Assets. The Seller shall not (i) consolidate
or merge with or into any other Person or (ii) sell, lease or otherwise transfer all or
substantially all of its assets to any other Person; provided that the Seller may merge or
consolidate with another Person if the Seller is the Person surviving such merger.

(x) Asset Reports. The Seller will furnish to the Buyer monthly electronic Purchased
Asset performance data, including, without limitation, delinquency reports, pool analytic reports
and static pool reports (i.e., delinquency, foreclosure and net charge-off reports) and monthly
stratification reports summarizing the characteristics of the Purchased Assets.

(y) Agency Approvals; Servicing. The Seller shall maintain its status with Fannie Mae
as an approved lender and Freddie Mac as an approved seller/servicer, in each case in good standing
(each such approval, an “Agency Approval”). The Seller shall service all Purchased Assets
which are subject to an Agency Takeout Commitment in accordance with the applicable Agency guide.
Should the Seller, for any reason, cease to possess all such applicable Agency Approvals to the
extent necessary, or should notification to the relevant Agency or to HUD, FHA or VA be required,
the Seller shall so notify the Buyer immediately in writing. Notwithstanding the preceding
sentence, the Seller shall take all necessary action to maintain all of its applicable Agency
Approvals at all times during the term of this Repurchase Agreement and each outstanding
Transaction.

(z) Guarantees. The Seller shall not create, incur, assume or suffer to exist any
Guarantees, except (i) Seller Excluded Guarantees, (ii) to the extent reflected in the Seller’s
financial statements or notes thereto or (iii) to the extent the aggregate Guarantees of the Seller
do not exceed $5,000,000.

(aa) Takeout Payments. With respect to each Mortgage Loan subject to a Takeout
Commitment, the Seller shall arrange that all payments under the related Takeout Commitment shall
be paid directly to the Buyer at the account set forth in Section 9 hereof, or to an account
approved by the Buyer in writing prior to such payment. With respect to any Agency Takeout
Commitment, if applicable, (i) with respect to the wire transfer instructions as set forth in
Freddie Mac Form 987 (Wire Transfer Authorization for a Cash Warehouse Delivery) such wire transfer
instructions are identical to the Buyer’s wire instructions or the Buyer has approved such wire
transfer instructions in writing in its sole discretion, or (ii) the Payee Number set forth on
Fannie Mae Form 1068 (Fixed-Rate, Graduated-Payment, or Growing-Equity Asset Schedule) or Fannie
Mae Form 1069 (Adjustable-Rate Asset Schedule), as applicable, is identical to the Payee Number
that has been identified by the Buyer in writing as the Buyer’s Payee Number or the Buyer has
approved the related Payee Number in writing in its sole discretion; With respect to any Takeout
Commitment with an Agency for which the Agency is swapping the related Mortgage Loans for a
mortgage backed security, the applicable Agency documents list the Buyer as sole subscriber.

(bb) Underwriting Guidelines. In the event that either Seller makes any amendment or
modification to the Underwriting Guidelines, such Seller shall promptly deliver to the Buyer notice
of the amended or modified Underwriting Guidelines with appropriate access to such Underwriting
Guidelines.

(cc) Use of Proceeds. The Seller shall not enter into Transactions hereunder with the
intent to apply any of the Purchase Price to the outstanding Repurchase Price under the MLMCI
Facility.

	 	 	SECTION 13. EVENTS OF DEFAULT

Section 13.01 Events of Default. If any of the following events (each, an “Event
of Default”) occur, the Sellers and the Buyer shall have the rights set forth in Section 14, as
applicable:

(a) either Seller shall default in the payment of (i) any amount payable by it hereunder or
under any other Repurchase Document, (ii) Expenses within ten (10) Business Days after the same
becomes due and payable or (iii) any other Obligations, when the same shall become due and payable,
whether at the due date thereof, or by acceleration or otherwise; or

(b) the failure of either Seller to perform, comply with or observe any term, covenant or
agreement applicable to it contained in Sections 12(a)(i), (h), (j), (k), (q), (r), (s), (t), (u),
(v), (w), (y), (z), (aa), or (cc); or

(c) any representation, warranty or certification made or deemed made herein or in any other
Repurchase Document by either Seller or any certificate furnished to the Buyer pursuant to the
provisions hereof or thereof or any information with respect to the Purchased Assets furnished in
writing by on behalf of either Seller shall prove to have been untrue or misleading in any material
respect as of the time made or furnished (other than the representations and warranties set forth
in Schedule 1, which shall be considered solely for the purpose of determining the Market Value of
the Purchased Assets; unless (i) either Seller shall have made any such representations and
warranties with actual knowledge that they were materially false or misleading at the time made; or
(ii) any such representations and warranties have been determined in good faith by the Buyer in its
sole discretion to be materially false or misleading on a regular basis); or

(d) either Seller shall fail to observe or perform (i) any term, covenant or agreement
applicable to it contained in Sections 12(x) or (bb) and if such default shall be capable of being
remedied, and such failure to observe or perform shall continue unremedied for a period of three
(3) Business Days after notice by the Buyer or (ii) any other covenant or agreement contained in
this Repurchase Agreement (and not identified in clause (b) or (d)(i) of Section 13.01) or any
other Repurchase Document, and if such default shall be capable of being remedied, and such failure
to observe or perform shall continue unremedied for a period of ten (10) Business Days after notice
by the Buyer; or

(e) a judgment or judgments for the payment of money in excess of $20,000,000 in the aggregate
shall be rendered against either Seller or any of their Affiliates by one or more courts,
administrative tribunals or other bodies having jurisdiction and the same shall not be satisfied,
discharged (or provision shall not be made for such discharge) or bonded, or a stay of execution
thereof shall not be procured, within (thirty) 30 days from the date of entry thereof, and such
Seller or any such Affiliate shall not, within said period of (thirty) 30 days, or such longer
period during which execution of the same shall have been stayed or bonded, appeal therefrom and
cause the execution thereof to be stayed during such appeal; provided, however, that any such
judgment or judgments shall not give rise to an Event of Default under this Section 13(e) if and so
long as (A) the amount of such judgment or order which remains unsatisfied is covered by a valid
and binding policy of insurance between either Seller or any of their Affiliates in respect of such
judgment or judgments and the insurer covering full payment of such unsatisfied amount and (B) such
insurer, which shall be rated at least “A” by A.M. Best Company, has been notified, and has not
disputed the claim made for payment, of the amount of such judgment or judgments; or

(f) any “event of default” or any other default which permits a demand for, or requires, the
early repayment of obligations due by either Seller or any of their Affiliates under (i) any
agreement (after the expiration of any applicable grace period under any such agreement) relating
to any Indebtedness (other than any Structured Securities Debt) of either Seller or any Affiliate,
as applicable, to which the Buyer or any Affiliate of the Buyer is a party or (ii) any agreement
(after the expiration of any applicable grace period under any such agreement) relating to any
Indebtedness of either Seller or any of their Affiliates (other than any Structured Securities
Debt), as applicable; in an amount equal to or greater than $20,000,000; or

(g) an Event of Insolvency shall have occurred with respect to either Seller; or

(h) for any reason, this Repurchase Agreement at any time shall not be in full force and
effect in all material respects or shall not be enforceable in all material respects in accordance
with its terms, or any party thereto (other than the Buyer or any Affiliate of the Buyer) shall
seek to disaffirm, terminate, limit or reduce its obligations hereunder; or

(i) this Agreement shall for any reason cease to create a valid, first priority security
interest in any material portion of the Purchased Assets or Repurchase Assets purported to be
covered hereby; or

(j) any event having a Material Adverse Effect shall occur, in each case as determined by the
Buyer in its sole good faith discretion, or any other condition shall exist which, in the Buyer’s
sole good faith discretion, constitutes a material impairment of either Seller’s ability to perform
its obligations under this Repurchase Agreement or any other Repurchase Document; or

(k) (i) any Person shall engage in any “prohibited transaction” (as defined in Section 406 of
ERISA or Section 4975 of the Code) involving any Plan of either Seller, (ii) any material
“accumulated funding deficiency” (as defined in Section 302 of ERISA), whether or not waived, shall
exist with respect to any Plan or any Lien in favor of the PBGC or a Plan shall arise on the assets
of either Seller or any Commonly Controlled Entity, (iii) a Reportable Event shall occur with
respect to, or proceedings shall commence to have a trustee appointed, or a trustee shall be
appointed, to administer or to terminate, any Plan of either Seller, which Reportable Event or
commencement of proceedings or appointment of a trustee is, in the reasonable opinion of the Buyer,
likely to result in the termination of such Plan for purposes of Title IV of ERISA, (iv) any Plan
of either Seller shall terminate for purposes of Title IV of ERISA, (v) either Seller or any
Commonly Controlled Entity shall, or in the reasonable opinion of the Buyer is likely to, incur any
liability in connection with a withdrawal from, or the insolvency or reorganization of, a
Multiemployer Plan or (vi) any other event or condition shall occur or exist with respect to a Plan
of either Seller; and in each case in clauses (i) through (vi) above, such event or condition,
together with all other such events or conditions, if any, could reasonably be expected to have a
Material Adverse Effect; or

(l) The Sellers’ audited annual financial statements or the notes thereto or other opinions or
conclusions stated therein shall be qualified or limited by reference to the status of either
Seller, as applicable, as a “going concern” or a reference of similar import; or

(m) The failure of FIC to at any time continue to be (i) qualified as a real estate investment
trust as defined in Section 856 of the Code and (ii) entitled to a dividend paid deduction under
Section 857 of the Code with respect to dividends paid by it with respect to each taxable year for
which it claims a deduction on its Form 1120 – REIT filed with the United States Internal Revenue
Service for such year, or the entering into by FIC of any material “prohibited transactions” as
defined in Sections 857(b) and 856(c) of the Code.

Section 13.02 Termination Event. (a) If the following event (a
“Termination Event”) occurs, the Buyer shall have the rights set forth in Section 13.02(b):

(i) The senior debt obligations or short-term debt obligations of Merrill Lynch & Co.,
Inc. shall be rated below the four highest generic grades (without regard to any pluses and
minuses reflecting gradations within such generic grades) by any nationally recognized
statistical rating organization.

(ii) A Change in Control of either Seller shall have occurred.

(iii) Any change or development occurs involving a prospective change in taxation or
other applicable law or regulation or interpretation thereof in the United States directly
affecting the Purchased Assets or the consequences of the Buyer owning, or holding a
security interest in, the Purchased Assets; the imposition of exchange controls by the
United States, that directly affects the Purchased Assets or the consequences of the Buyer
owning, or holding a security interest in, the Purchased Assets; or the imposition of
exchange controls by the United States, that directly affects the financial markets of the
United States, and makes it, in the sole judgment of the Buyer, inadvisable or impracticable
to enter into Transactions with the Mortgage Loans.

(b) Upon the occurrence of a Termination Event, the Buyer shall have the right, in its sole
discretion, to immediately terminate the Buyer’s obligation to enter into any additional
Transactions. The Seller shall repurchase any Purchased Assets subject to a Transaction hereunder
no later than ninety (90) days with respect to a Termination Event under Section 13.02(i) and
thirty (30) days with respect to a Termination Event under Sections 13.02(ii) or 13.02(iii)
following receipt of a request therefor from the Buyer following the occurrence of a Termination
Event.

	 	 	SECTION 14. REMEDIES

(a) If an Event of Default occurs and is continuing with respect to either Seller, the
following rights and remedies are available to the Buyer; provided, that an Event of Default shall
be deemed to be continuing unless expressly waived by the Buyer in writing:

(i) At the option of the Buyer, exercised by written notice to the Sellers (which
option shall be deemed to have been exercised, even if no notice is given, immediately upon
the occurrence of an Event of Insolvency of either Seller), the Repurchase Date for each
Transaction hereunder, if it has not already occurred, shall be deemed immediately to occur.
The Buyer shall (except upon the occurrence of an Event of Insolvency of the Seller) give
notice to the Sellers of the exercise of such option as promptly as practicable.

(ii) If the Buyer exercises or is deemed to have exercised the option referred to in
subsection (a)(i) of this Section:

(A) the Sellers’ obligations in such Transactions to repurchase all Purchased
Assets, at the Repurchase Price therefor on the Repurchase Date determined in
accordance with subsection (a)(i) of this Section, (1) shall thereupon become
immediately due and payable; (2) all Income paid after such exercise or deemed
exercise shall be retained by the Buyer and applied to the aggregate unpaid
Repurchase Price and any other amounts owed by the Sellers hereunder; and (3) any
remaining amounts shall be remitted to the Seller.

(B) to the extent permitted by applicable law, the Repurchase Price with
respect to each such Transaction shall be increased by the aggregate amount obtained
by daily application of, on a 360 day per year basis for the actual number of days
during the period from and including the date of the exercise or deemed exercise of
such option to but excluding the date of payment of the Repurchase Price as so
increased, (x) the Post-Default Rate in effect following an Event of Default to
(y) the Repurchase Price for such Transaction as of the Repurchase Date as
determined pursuant to subsection (a)(i) of this Section (decreased as of any day by
(i) any amounts actually in the possession of the Buyer pursuant to clause (C) of
this subsection, and (ii) any proceeds from the sale of Purchased Assets applied to
the Repurchase Price pursuant to subsection (a)(iv) of this Section; and

(C) all Income actually received by the Buyer pursuant to Section 5 (excluding
any Late Payment Fees paid pursuant to Section 5(a)) shall be applied to the
aggregate unpaid Repurchase Price owed by the Sellers.

(iii) Upon the occurrence of one or more Events of Default, the Buyer shall have the
right to obtain physical possession of all files of the Sellers relating to the Purchased
Assets and the Repurchase Assets and all documents relating to the Purchased Assets which
are then or may thereafter come into the possession of the Sellers or any third party acting
for the Sellers and the Sellers shall deliver to the Buyer such assignments as the Buyer
shall request. The Buyer shall be entitled to specific performance of all agreements of the
Sellers contained in the Repurchase Documents.

(iv) At any time on the Business Day following notice to the Sellers (which notice may
be the notice given under subsection (a)(i) of this Section), in the event the Sellers have
not repurchased all Purchased Assets, the Buyer may (A) immediately sell, without demand or
further notice of any kind, at a public or private sale and at such price or prices as the
Buyer may deem satisfactory any or all Purchased Assets and the Repurchase Assets subject to
a such Transactions hereunder and apply the proceeds thereof to the aggregate unpaid
Repurchase Prices and any other amounts owing by the Sellers hereunder or (B) in its sole
discretion elect, in lieu of selling all or a portion of such Purchased Assets, to give the
Sellers credit for such Purchased Assets and the Repurchase Assets in an amount equal to the
Market Value of the Purchased Assets against the aggregate unpaid Repurchase Price and any
other amounts owing by the Sellers hereunder. The proceeds of any disposition of Purchased
Assets and the Repurchase Assets under clauses (A) or (B) shall be applied first to the
costs and expenses incurred by the Buyer in connection with the applicable Seller’s default;
second to costs of cover and/or related hedging transactions; third to the Repurchase Price;
fourth to any other outstanding obligation of the Sellers to the Buyer or its Affiliates;
and fifth, any remaining amounts to the Sellers.

(v) The Sellers shall be liable to the Buyer for (i) the amount of all reasonable legal
or other expenses (including, without limitation, all costs and expenses of the Buyer in
connection with the enforcement of this Repurchase Agreement or any other agreement
evidencing a Transaction, whether in action, suit or litigation or bankruptcy, insolvency or
other similar proceeding affecting creditors’ rights generally, further including, without
limitation, the reasonable fees and expenses of counsel (including the costs of internal
counsel of the Buyer) incurred 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.

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

(b) The Buyer may exercise one or more of the remedies available to the Buyer immediately upon
the occurrence of an Event of Default and at any time thereafter without notice to the Sellers.
All rights and remedies arising under this Repurchase Agreement as amended from time to time
hereunder are cumulative and not exclusive of any other rights or remedies which the Buyer may
have.

(c) The Buyer may enforce its rights and remedies hereunder without prior judicial process or
hearing, and each Seller hereby expressly waives any defenses it might otherwise have to require
the Buyer to enforce its rights by judicial process. Each Seller also waives any defense (other
than a defense of payment or performance) it might otherwise have arising from the use of
nonjudicial process, enforcement and sale of all or any portion of the Repurchase Assets, or from
any other election of remedies. The Sellers recognize that nonjudicial remedies are consistent
with the usages of the trade, are responsive to commercial necessity and are the result of a
bargain at arm’s length.

(d) To the extent permitted by applicable law, the Sellers shall be liable to the Buyer for
interest on any amounts owing by the Sellers hereunder, from the date the Sellers become liable for
such amounts hereunder until such amounts are (i) paid in full by the Sellers or (ii) satisfied in
full by the exercise of the Buyer’s rights hereunder. Interest on any sum payable by the Sellers
to the Buyer under this Section 14(d) shall be at a rate equal to the Post-Default Rate.

	 	 	SECTION 15. INDEMNIFICATION AND EXPENSES; RECOURSE

(a) Each of the Sellers agrees to hold the Buyer, and its Affiliates and their officers,
directors, employees, agents and advisors (each an “Indemnified Party”) harmless from and
indemnify any Indemnified Party against all liabilities, losses, damages, judgments, costs and
expenses of any kind which may be imposed on, incurred by or asserted against such Indemnified
Party (without duplication of Section 7(c)) (collectively, “Costs”), relating to or arising
out of this Repurchase Agreement, any other Repurchase Document or any transaction contemplated
hereby or thereby, or any amendment, supplement or modification of, or any waiver or consent under
or in respect of, this Repurchase Agreement, any other Repurchase Document or any transaction
contemplated hereby or thereby, that, in each case, results from anything other than the
Indemnified Party’s gross negligence or willful misconduct. Without limiting the generality of the
foregoing, the Sellers agree to hold any Indemnified Party harmless from and indemnify such
Indemnified Party against all Costs with respect to all Purchased Assets relating to or arising out
of any taxes incurred or assessed in connection with the ownership of the Purchased Assets, that,
in each case, results from anything other than the Indemnified Party’s gross negligence or willful
misconduct. In any suit, proceeding or action brought by an Indemnified Party in connection with
any Purchased Asset for any sum owing thereunder, or to enforce any provisions of any Purchased
Asset, the Sellers will save, indemnify and hold such Indemnified Party harmless from and against
all expense, loss or damage suffered by reason of any defense, set-off, counterclaim, recoupment or
reduction or liability whatsoever of the account debtor or obligor thereunder, arising out of a
breach by either Seller of any obligation thereunder or arising out of any other agreement,
indebtedness or liability at any time owing to or in favor of such account debtor or obligor or its
successors from either Seller provided, however, that the Sellers shall not be liable for any such
expense, loss or damage to the extent resulting from the Indemnified Party’s gross negligence or
willful misconduct. The Sellers also agree to reimburse an Indemnified Party as and when billed by
such Indemnified Party for all the Indemnified Party’s costs and expenses incurred in connection
with the enforcement or the preservation of the Buyer’s rights under this Repurchase Agreement, any
other Repurchase Document or any transaction contemplated hereby or thereby, including without
limitation the reasonable fees and disbursements of its counsel provided, however, that the Sellers
shall not be liable for any such expense, loss or damage to the extent resulting from the
Indemnified Party’s gross negligence or willful misconduct.

(b) The Sellers agree to pay within thirty (30) days when billed by the Buyer all of the
out-of-pocket costs and expenses incurred by the Buyer in connection with the development,
preparation and execution of, and any amendment, supplement or modification to, this Repurchase
Agreement, any other Repurchase Document or any other documents prepared in connection herewith or
therewith. The Sellers agree to pay all of the reasonable out-of-pocket costs and expenses
incurred in connection with the consummation and administration of the transactions contemplated
hereby and thereby including without limitation filing fees and all the reasonable fees,
disbursements and expenses of counsel to the Buyer which amount shall be deducted from the Purchase
Price paid for the first Transaction hereunder. Subject to the limitations set forth in Section 27
hereof, the Sellers agree to pay the Buyer all the reasonable out of pocket due diligence,
inspection, testing and review costs and expenses incurred by the Buyer with respect to Purchased
Assets submitted by the Sellers for purchase under this Repurchase Agreement, including, but not
limited to, those out of pocket costs and expenses incurred by the Buyer pursuant to Sections 15(b)
and 27 hereof.

(c) The obligations of the Sellers from time to time to pay the Repurchase Price, the Periodic
Advance Repurchase Payments, and all other amounts due under this Repurchase Agreement shall be
full recourse obligations of the Sellers.

(d) Each Seller shall be jointly and severally liable for the full, complete an punctual
performance and satisfaction of all obligations of either Seller under this Repurchase Agreement.
Accordingly, each Seller waives any and all notice of creation, renewal, extension or accrual of
any of the Obligations and notice of or proof of reliance by the Buyer upon such Seller’s joint and
several liability. Each Seller waives diligence, presentment, protest, demand for payment and
notice of default or nonpayment to or upon such Seller with respect to the Obligations. When
pursuing its rights and remedies hereunder against either Seller, the Buyer may, but shall be under
no obligation, to pursue such rights and remedies hereunder against either Seller or any other
Person or against any collateral security for the Obligations or any right of offset with respect
thereto, and any failure by the Buyer to pursue such other rights or remedies or to collect any
payments from such Seller or any such other Person to realize upon any such collateral security or
to exercise any such right of offset, or any release of such Seller or any such other Person or any
such collateral security, or right of offset, shall not relieve such Seller of any liability
hereunder, and shall not impair or affect the rights and remedies, whether express, implied or
available as a matter of law, of the Buyer against such Seller.

	 	 	SECTION 16. SERVICING

(a) The Sellers, on the Buyer’s behalf, shall contract with Servicer to, or if a Seller is the
Servicer, such Seller shall, service the Mortgage Loans consistent with the degree of skill and
care that such Seller customarily requires with respect to similar Mortgage Loans owned or managed
by it and in accordance with Accepted Servicing Practices. The Sellers shall cause the Servicer to
(i) comply with all applicable Federal, State and local laws and regulations, (ii) maintain all
state and federal licenses necessary for it to perform its servicing responsibilities hereunder,
and (iii) not impair the rights of the Buyer in any Purchased Assets or any payment thereunder.
The Buyer may terminate the servicing of any Purchased Asset with the then existing Servicer in
accordance with Section 16(e) hereof.

(b) The Sellers shall cause the Servicer to hold or cause to be held all escrow funds
collected by the Sellers with respect to any Purchased Assets in trust accounts and shall apply the
same for the purposes for which such funds were collected.

(c) The Sellers shall cause the Servicer to deposit all Income received by the Sellers on
account of the Purchased Assets in the Collection Account no less than once per week.

(d) The Sellers shall provide promptly to the Buyer (i) a Servicer Notice addressed to and
agreed to by the Servicer of the related Purchased Assets, advising such Servicer of such matters
as the Buyer may reasonably request, including, without limitation, recognition by the Servicer of
the Buyer’s interest in such Purchased Assets and the Servicer’s agreement that upon receipt of
notice of an Event of Default from the Buyer, it will follow the instructions of the Buyer with
respect to the Purchased Assets and any related Income with respect thereto.

(e) Upon the occurrence and during the continuance of an Event of Default hereunder, the Buyer
shall have the right to immediately terminate the Servicer’s right to service the Purchased Assets
without payment of any penalty or termination fee. The Sellers shall cooperate in transferring the
servicing of the Purchased Assets to a successor servicer appointed by the Buyer in its sole
discretion.

(f) If either Seller should discover that, for any reason whatsoever, any entity responsible
to either Seller by contract for managing or servicing any such Purchased Asset has failed to
perform fully such Seller’s obligations under the Repurchase Documents or any of the obligations of
such entities with respect to the Purchased Assets in any material respect, such Seller shall
promptly notify the Buyer.

	 	 	SECTION 17. SINGLE AGREEMENT

The Buyer and the Sellers 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 that each has been entered
into in consideration of the other Transactions. Accordingly, each of the Buyer and the Sellers
agree (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 Transaction hereunder, (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, and (iv) to promptly provide notice to the other after any such set-off or
application.

	 	 	SECTION 18. SET-OFF

In addition to any rights and remedies of the Buyer hereunder and by law, the Buyer shall have
the right, without prior notice to the Sellers, any such notice being expressly waived by the
Sellers to the extent permitted by applicable law, upon any amount becoming due and payable by the
Sellers hereunder (whether at the stated maturity, by acceleration or otherwise) to set-off and
appropriate and apply against such amount any and all deposits (general or special, time or demand,
provisional or final), in any currency, and any other credits, indebtedness or claims, in any
currency, in each case whether direct or indirect, absolute or contingent, matured or unmatured, at
any time held or owing by the Buyer or any Affiliate thereof to or for the credit or the account of
the Sellers or any Affiliate thereof. The Buyer agrees promptly to notify the Sellers after any
such set-off and application made by the Buyer, provided that the failure to give such notice shall
not affect the validity of such set-off and application.

	 	 	SECTION 19. NOTICES AND OTHER COMMUNICATIONS

Except as otherwise expressly permitted by this Repurchase Agreement, all notices, requests
and other communications provided for herein (including without limitation any modifications of, or
waivers, requests or consents under, this Repurchase Agreement) shall be given or made in writing
(including without limitation by telecopy) delivered to the intended recipient at the “Address for
Notices” specified below its name on the signature pages hereof or thereof); or, as to any party,
at such other address as shall be designated by such party in a written notice to each other party.
Except as otherwise provided in this Repurchase Agreement and except for notices given under
Section 3 (which shall be effective only on receipt), all such communications shall be deemed to
have been duly given when transmitted by telecopy or personally delivered or, in the case of a
mailed notice, upon receipt, in each case given or addressed as aforesaid.

	 	 	SECTION 20. ENTIRE AGREEMENT; SEVERABILITY

This Repurchase Agreement, together with the Repurchase Documents, constitute the entire
understanding between the Buyer and the Sellers with respect to the subject matter they cover and
shall supersede any existing agreements between the parties containing general terms and conditions
for repurchase transactions involving Purchased Assets. By acceptance of this Repurchase
Agreement, the Buyer and the Sellers acknowledge that they have not made, and are not relying upon,
any statements, representations, promises or undertakings not contained in this Repurchase
Agreement. 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.

	 	 	SECTION 21. NON-ASSIGNABILITY

(a) The rights and obligations of the parties under this Repurchase Agreement and under any
Transaction shall not be assigned by either Seller without the prior written consent of the Buyer.
Subject to the foregoing, this Repurchase Agreement and any Transactions shall be binding upon and
shall inure to the benefit of the parties and their respective successors and assigns. Nothing in
this Repurchase Agreement express or implied, shall give to any Person, other than the parties to
this Repurchase Agreement and their successors hereunder, any benefit of any legal or equitable
right, power, remedy or claim under this Repurchase Agreement. The Buyer may from time to time
assign all or a portion of its rights and obligations under this Repurchase Agreement and the
Repurchase Documents; provided, however, that the Buyer shall maintain, for review by the Sellers
upon written request a copy of an executed assignment and acceptance by the Buyer and assignee
(“Assignment and Acceptance”), specifying the percentage or portion of such rights and
obligations assigned. Upon such assignment, (a) such assignee shall be a party hereto and to each
Repurchase Document to the extent of the percentage or portion set forth in the Assignment and
Acceptance, and shall succeed to the applicable rights and obligations of the Buyer hereunder, and
(b) the Buyer shall, to the extent that such rights and obligations have been so assigned by it be
released from its obligations hereunder and under the Repurchase Documents. Unless otherwise
stated in the Assignment and Acceptance, the Sellers shall continue to take directions solely from
the Buyer unless otherwise notified by the Buyer in writing. The Buyer may distribute to any
prospective assignee any document or other information delivered to the Buyer by the Sellers.

(b) The Buyer may sell participations to one or more Persons; provided, however, that (i) no
participant under any such participation shall have any right to approve any amendment or waiver of
any provision of the Repurchase Agreement or any other Repurchase Document, or any consent to any
departure by the Sellers or the Buyer therefrom; (ii) the Buyer’s obligations under this Repurchase
Agreement shall remain unchanged; (iii) the Buyer shall remain solely responsible to the other
parties hereto for the performance of such obligations; and (iv) the Sellers shall continue to deal
solely and directly with the Buyer in connection with the Buyer’s rights and obligations under this
Repurchase Agreement and the other Repurchase Documents; provided that Taxes shall be governed
solely and exclusively by Section 6 and 7.

(c) (i) Prior to the occurrence of an Event of Default, the Buyer may from time to time
assign all or a portion of its rights and obligations under this Repurchase Agreement and the
Repurchase Documents to any Person (A) without the prior written consent of the Sellers, provided
that the Buyer or an Affiliate of the Buyer retains a portion equal to at least twenty (20%) of the
Maximum Purchase Price; or (B) with the prior consent of the Sellers, which consent shall not be
unreasonably withheld or delayed. The Buyer shall maintain, for review by the Sellers upon written
request, a copy of an executed assignment and acceptance by the Buyer and assignee (each an
“Assignment and Acceptance”), specifying the percentage or portion of such rights and
obligations assigned. Upon such assignment, and pursuant to an amendment of this Repurchase
Agreement as set forth in clause (iii) below, (A) such assignee shall be a party hereto and to each
Repurchase Document to the extent of the percentage or portion set forth in the Assignment and
Acceptance, and shall succeed to the applicable rights and obligations of the Buyer hereunder, and
(B) the Buyer shall, to the extent that such rights and obligations have been so assigned by it be
released from its obligations hereunder and under the Repurchase Documents. After the occurrence
and during the continuance of an Event of Default, the Buyer may assign all or a portion of its
rights and obligations under this Repurchase Agreement and the Repurchase Documents to any Person
without the prior consent of the Sellers. Unless otherwise stated in the Assignment and
Acceptance, the Sellers shall continue to take directions solely from the Buyer unless otherwise
notified by the Buyer in writing.

(ii) Subject to acceptance and recording thereof pursuant to Section 21(d) hereof and the
amendment of this Repurchase Agreement pursuant to clause (iii) hereof, from and after the
effective date specified in each Assignment and Acceptance the assignee thereunder shall be a party
hereto and, to the extent of the interest assigned by such Assignment and Acceptance, have the
rights and obligations of the Buyer under this Repurchase Agreement. Any assignment or transfer by
the Buyer of rights or obligations under this Repurchase Agreement that does not comply with this
Section 21 shall be treated for purposes of this Repurchase Agreement as a sale by such Buyer of a
participation in such rights and obligations in accordance with Section 21(d) hereof.

(iii) In the event that the Buyer assigns all or a portion of its rights and obligations under
this Repurchase Agreement pursuant to this Section 21(c), the parties hereto hereby agree to
negotiate in good faith and use commercially reasonable efforts to enter into prior to such
transfer an amendment to this Repurchase Agreement to add agency provisions similar to those
included in repurchase agreements for similar syndicated repurchase facilities; provided, however,
that the Buyer and the Sellers hereby agree that any such amendment shall provide that the
Repurchase Agreement may be amended or waived upon the written consent of the Sellers and those
Buyers committed to engage in the Transactions hereunder representing a majority of the Maximum
Repurchase Price.

(d) The Sellers shall maintain a register (the “Register”) on which it will record the Buyer’s
rights hereunder, and each Assignment and Acceptance and participation; provided, however, that the
Sellers shall not be required to record any transfer on the Register of which the Sellers have not
received notice, or do not have knowledge. The Register shall include the names and addresses of
the Buyers (including all assignees, successors and participants). Failure to make any such
recordation, or any error in such recordation shall not affect the Sellers’ obligations in respect
of such rights. If the Buyer sells a participation in its rights hereunder, it shall provide the
Sellers, or maintain as agent of the Sellers, the information described in this paragraph and
permit the Sellers to review such information as reasonably needed for the Sellers to comply with
its obligations under this Repurchase Agreement or under any applicable law or governmental
regulation or procedure.

(e) The Buyer may, in connection with any assignment or participation or proposed assignment
or participation pursuant to this Section 21, disclose to the assignee or participant or proposed
assignee or participant, as the case may be, any information relating to the Sellers or any of
their Subsidiaries or to any aspect of the Transactions that has been furnished to the Buyer by or
on behalf of the Sellers or any of their Subsidiaries; provided that such assignee or participant
agrees to hold such information subject to the confidentiality provisions of this Repurchase
Agreement.

(f) The Buyer may at any time create a security interest in all or any portion of its rights
under this Repurchase Agreement in favor of any Federal Reserve Bank in accordance with Regulation
A of the Board of Governors of the Federal Reserve System and any Operating Circular issued by such
Federal Reserve Bank. No such assignment shall release the assigning the Buyer from its
obligations hereunder.

	 	 	SECTION 22. TERMINABILITY

Each representation and warranty made or deemed to be made by entering into a Transaction,
herein or pursuant hereto shall survive the making of such representation and warranty, and the
Buyer shall not be deemed to have waived any Default that may arise because any such representation
or warranty shall have proved to be false or misleading, notwithstanding that the Buyer may have
had notice or knowledge or reason to believe that such representation or warranty was false or
misleading at the time the Transaction was made. Notwithstanding any such termination or the
occurrence of an Event of Default, all of the representations and warranties and covenants
hereunder shall continue and survive. The obligations of the Sellers under Section 15 hereof shall
survive the termination of this Repurchase Agreement.

	 	 	SECTION 23. GOVERNING LAW

THIS REPURCHASE AGREEMENT SHALL BE GOVERNED BY THE INTERNAL LAWS OF THE STATE OF NEW YORK
WITHOUT GIVING EFFECT TO THE CONFLICT OF LAW PRINCIPLES THEREOF.

	 	 	SECTION 24. SUBMISSION TO JURISDICTION; WAIVERS

EACH OF BUYER AND EACH OF THE SELLERS HEREBY IRREVOCABLY AND UNCONDITIONALLY:

(i) SUBMITS FOR ITSELF AND ITS PROPERTY IN ANY LEGAL ACTION OR PROCEEDING RELATING TO
THIS REPURCHASE AGREEMENT AND THE OTHER REPURCHASE DOCUMENTS, OR FOR RECOGNITION AND
ENFORCEMENT OF ANY JUDGMENT IN RESPECT THEREOF, TO THE EXCLUSIVE GENERAL JURISDICTION OF THE
COURTS OF THE STATE OF NEW YORK, THE FEDERAL COURTS OF THE UNITED STATES OF AMERICA FOR THE
SOUTHERN DISTRICT OF NEW YORK, AND APPELLATE COURTS FROM ANY THEREOF;

(ii) CONSENTS THAT ANY SUCH ACTION OR PROCEEDING MAY BE BROUGHT IN SUCH COURTS AND, TO
THE EXTENT PERMITTED BY LAW, WAIVES ANY OBJECTION THAT IT MAY NOW OR HEREAFTER HAVE TO THE
VENUE OF ANY SUCH ACTION OR PROCEEDING IN ANY SUCH COURT OR THAT SUCH ACTION OR PROCEEDING
WAS BROUGHT IN AN INCONVENIENT COURT AND AGREES NOT TO PLEAD OR CLAIM THE SAME;

(iii) AGREES THAT SERVICE OF PROCESS IN ANY SUCH ACTION OR PROCEEDING MAY BE EFFECTED
BY MAILING A COPY THEREOF BY REGISTERED OR CERTIFIED MAIL (OR ANY SUBSTANTIALLY SIMILAR FORM
OF MAIL), POSTAGE PREPAID, TO ITS ADDRESS SET FORTH UNDER ITS SIGNATURE BELOW OR AT SUCH
OTHER ADDRESS OF WHICH THE BUYER SHALL HAVE BEEN NOTIFIED;

(iv) AGREES THAT NOTHING HEREIN SHALL AFFECT THE RIGHT TO EFFECT SERVICE OF PROCESS IN
ANY OTHER MANNER PERMITTED BY LAW OR SHALL LIMIT THE RIGHT TO SUE IN ANY OTHER JURISDICTION;
AND

(v) WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY AND ALL RIGHT TO
TRIAL BY JURY IN ANY LEGAL PROCEEDING ARISING OUT OF OR RELATING TO THIS REPURCHASE
AGREEMENT, ANY OTHER TRANSACTION DOCUMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY OR
THEREBY.

	 	 	SECTION 25. NO WAIVERS, ETC.

No failure on the part of the Buyer to exercise and no delay in exercising, and no course of
dealing with respect to, any right, power or privilege under any Repurchase Document shall operate
as a waiver thereof, nor shall any single or partial exercise of any right, power or privilege
under any Repurchase Document preclude any other or further exercise thereof or the exercise of any
other right, power or privilege. The remedies provided herein are cumulative and not exclusive of
any remedies provided by law. An Event of Default shall be deemed to be continuing unless
expressly waived by the Buyer in writing.

	 	 	SECTION 26. NETTING

If the Buyer and the Sellers are “financial institutions” as now or hereinafter defined in
Section 4402 of Title 12 of the United States Code (“Section 4402”) and any rules or
regulations promulgated thereunder,

(a) All amounts to be paid or advanced by one party to or on behalf of the other under this
Repurchase Agreement or any Transaction hereunder shall be deemed to be “payment obligations” and
all amounts to be received by or on behalf of one party from the other under this Repurchase
Agreement or any Transaction hereunder shall be deemed to be “payment entitlements” within the
meaning of Section 4402, and this Repurchase Agreement shall be deemed to be a “netting contract”
as defined in Section 4402.

(b) The payment obligations and the payment entitlements of the parties hereto pursuant to
this Repurchase Agreement and any Transaction hereunder shall be netted as follows. In the event
that either party (the “Defaulting Party”) shall fail to honor any payment obligation under
this Repurchase Agreement or any Transaction hereunder, the other party (the “Nondefaulting
Party”) shall be entitled to reduce the amount of any payment to be made by the Nondefaulting
Party to the Defaulting Party by the amount of the payment obligation that the Defaulting Party
failed to honor.

	 	 	SECTION 27. DUE DILIGENCE

The Sellers acknowledge that Buyer has the right to perform continuing due diligence reviews
with respect to the Mortgage Loans, REO Properties and the Sellers, for purposes of verifying
compliance with the representations, warranties and specifications made hereunder, or otherwise,
and the Sellers agree that upon reasonable prior notice unless an Event of Default shall have
occurred, in which case no notice is required, to the Sellers, the Buyer or its authorized
representatives will be permitted during normal business hours to examine, inspect, and make copies
and extracts of, the Asset Files and any and all documents, records, agreements, instruments or
information relating to such Mortgage Loans and REO Properties in the possession or under the
control of the Sellers and/or the Custodian. The Sellers also shall make available to the Buyer a
knowledgeable financial or accounting officer for the purpose of answering questions respecting the
Asset Files, the Mortgage Loans and REO Properties. Without limiting the generality of the
foregoing, the Sellers acknowledge that the Buyer may purchase Mortgage Loans and REO Properties
from the Sellers based solely upon the information provided by the Sellers to the Buyer in the
Purchased Asset Schedule and the representations, warranties and covenants contained herein, and
that the Buyer, at its option, has the right at any time to conduct a partial or complete due
diligence review on some or all of the Mortgage Loans and REO Properties purchased in a
Transaction, including, without limitation, ordering broker’s price opinions, new credit reports
and new appraisals on the related Mortgaged Properties and otherwise re-generating the information
used to originate such Mortgage Loan and REO Properties. The Buyer may underwrite such Mortgage
Loans and REO Properties itself or engage a mutually agreed upon third party underwriter to perform
such underwriting. The Sellers agree to cooperate with the Buyer and any third party underwriter
in connection with such underwriting, including, but not limited to, providing the Buyer and any
third party underwriter with access to any and all documents, records, agreements, instruments or
information relating to such Mortgage Loans and REO Properties in the possession, or under the
control, of the Sellers. The Sellers further agree that the Sellers shall pay all out-of-pocket
costs and expenses incurred by the Buyer in connection with the Buyer’s activities pursuant to this
Section 27 (“Due Diligence Costs”); provided, that such Due Diligence Costs shall not exceed
$25,000 per calendar year unless an Event of Default shall have occurred, in which event the Buyer
shall have the right to perform due diligence, at the sole expense of the Seller without regard to
the dollar limitation set forth herein.

	 	 	SECTION 28. NON-UTILIZATION FEE

No later than the Payment Date following the end of each calendar quarter, the Sellers shall
pay in immediately available funds to the Buyer the Non-Utilization Fee. Such payment shall be
made in Dollars, in immediately available funds, without deduction, set-off or counterclaim, to the
Buyer at an account designated by the Buyer.

	 	 	SECTION 29. COMMITMENT FEE

The Sellers shall pay quarterly to the Buyer in immediately available funds, the Commitment
Fee until the termination of this Repurchase Agreement. Such payment shall be made in Dollars, in
immediately available funds, without deduction, set-off or counterclaim, to the Buyer at such
account designated by the Buyer.

In the event that an event set forth in Section 3(b)(x) occurs, the result of which is the
cessation of Transactions hereunder, the Buyer shall refund to the Sellers an amount equal to the
Commitment Fee prorated for the number of days remaining prior to the respective Payment Date set
forth in this Section 29.

	 	 	SECTION 30. BUYER’S APPOINTMENT AS ATTORNEY-IN-FACT

(a) The Sellers hereby irrevocably constitute and appoint the Buyer and any officer or agent
thereof, with full power of substitution, as its true and lawful attorney-in-fact with full
irrevocable power and authority in the place and stead of the Sellers and in the name of the
Sellers or in its own name, from time to time in the Buyer’s discretion, for the purpose of
carrying out any term of this Repurchase Agreement which the Sellers have failed to perform after
notice, to take any and all appropriate action and to execute any and all documents and instruments
which may be reasonably necessary or desirable to accomplish the purposes of this Repurchase
Agreement, and, without limiting the generality of the foregoing, the Sellers hereby give the Buyer
the power and right, on behalf of the Sellers, without assent by, but with notice to, the Sellers,
if an Event of Default shall have occurred and be continuing, to do the following:

(i) in the name of the Sellers, or in its own name, or otherwise, to take possession of
and endorse and collect any checks, drafts, notes, acceptances or other instruments for the
payment of moneys due with respect to any other Repurchase Assets and to file any claim or
to take any other action or proceeding in any court of law or equity or otherwise deemed
appropriate by the Buyer for the purpose of collecting any and all such moneys due with
respect to any other Repurchase Assets whenever payable;

(ii) to pay or discharge taxes and Liens levied or placed on or threatened against the
Repurchase Assets;

(iii) (A) to direct any party liable for any payment under any Repurchase Assets to
make payment of any and all moneys due or to become due thereunder directly to the Buyer or
as the Buyer shall direct; (B) to ask or demand for, collect, receive payment of and receipt
for, any and all moneys, claims and other amounts due or to become due at any time in
respect of or arising out of any Repurchase Assets; (C) to sign and endorse any invoices,
assignments, verifications, notices and other documents in connection with any Repurchase
Assets; (D) to commence and prosecute any suits, actions or proceedings at law or in equity
in any court of competent jurisdiction to collect the Repurchase Assets or any proceeds
thereof and to enforce any other right in respect of any Repurchase Assets; (E) to defend
any suit, action or proceeding brought against the Sellers with respect to any Repurchase
Assets; (F) to settle, compromise or adjust any suit, action or proceeding described in
clause (E) above and, in connection therewith, to give such discharges or releases as the
Buyer may deem appropriate; and (G) generally, to sell, transfer, pledge and make any
agreement with respect to or otherwise deal with any Repurchase Assets as fully and
completely as though the Buyer were the absolute owner thereof for all purposes, and to do,
at the Buyer’s option and the Sellers’ expense, at any time, and from time to time, all acts
and things which the Buyer deems necessary to protect, preserve or realize upon the
Repurchase Assets and the Buyer’s Liens thereon and to effect the intent of this Repurchase
Agreement, all as fully and effectively as the Sellers might do.

(b) The Sellers hereby ratify all that said attorneys shall lawfully do or cause to be done by
virtue hereof. This power of attorney is a power coupled with an interest and shall be
irrevocable.

(c) The Sellers also authorize the Buyer, if an Event of Default shall have occurred and be
continuing, from time to time, to execute, in connection with any sale provided for in Section 14
hereof, any endorsements, assignments or other instruments of conveyance or transfer with respect
to the Repurchase Assets.

(d) The powers conferred on the Buyer hereunder are solely to protect the Buyer’s interests in
the Repurchase Assets and shall not impose any duty upon it to exercise any such powers. The Buyer
shall be accountable only for amounts that it actually receives as a result of the exercise of such
powers, and neither it nor any of its officers, directors, employees or agents shall be responsible
to the Sellers for any act or failure to act hereunder, except for its or their own gross
negligence or willful misconduct.

	 	 	SECTION 31. MISCELLANEOUS

(a) Counterparts. This Repurchase Agreement may be executed in any number of
counterparts, all of which taken together shall constitute one and the same instrument, and any of
the parties hereto may execute this Repurchase Agreement by signing any such counterpart.

(b) Captions. The captions and headings appearing herein are for included solely for
convenience of reference and are not intended to affect the interpretation of any provision of this
Repurchase Agreement.

(c) Acknowledgment. The Sellers hereby acknowledge that:

(i) it has been advised by counsel in the negotiation, execution and delivery of this
Repurchase Agreement and the other Repurchase Documents;

	 	 	 
	
 
	 	(ii)the Buyer has no fiduciary relationship to the Sellers; and
	 
	 	 
	
 
	 	(iii)no joint venture exists between the Buyer and the Sellers.
	 
	 	 
	SECTION 32.

	 	CONFIDENTIALITY

The Buyer and the Sellers hereby acknowledge and agree that all written or computer-readable
information provided by one party to any other regarding the terms set forth in any of the
Repurchase Documents or the Transactions contemplated thereby (the “Confidential Terms”)
shall be kept confidential and shall not be divulged to any party without the prior written consent
of such other party except to the extent that (i) it is provided to assignees, participants or
prospective assignees or participants who agree to hold the Confidential Terms in confidence in
accordance with the provisions hereof, (ii) it is necessary to do so in working with legal counsel,
auditors, taxing authorities or other governmental agencies or regulatory bodies or in order to
comply with any applicable federal or state laws, (iii) any of the Confidential Terms are in the
public domain other than due to a breach of this covenant, (iv) if an Event of Default has occurred
and is continuing and the Buyer determines such information to be necessary or desirable to
disclose in connection with the marketing and sales of the Purchased Assets or otherwise to enforce
or exercise the Buyer’s rights hereunder or (v) it is required by law, rule, regulation or order of
a court or other regulatory body including, without limitation, the SEC. The provisions set forth
in this Section 32 shall survive the termination of this Repurchase Agreement. Notwithstanding the
foregoing or anything to the contrary contained herein or in any other Repurchase Document, the
parties hereto may disclose to any and all Persons, without limitation of any kind, the U.S.
federal, state and local tax treatment of the transactions, any fact that may be relevant to
understanding the U.S. federal, state and local tax treatment of the transactions, and all
materials of any kind (including opinions or other tax analyses) relating to such U.S. federal,
state and local tax treatment and that may be relevant to understanding such tax treatment, other
than the name of the parties or any other persons, and any pricing terms (including, without
limitation, the Non-Utilization Fee, Commitment Fee, Pricing Rate, Purchase Price Percentage and
Purchase Price) or other nonpublic business or financial information (including any sublimits and
financial covenants) that is unrelated to the U.S. federal, state and local tax treatment of the
transactions to the taxpayer and is not relevant to understanding the U.S. federal, state and local
tax treatment of the transactions.

	 	 	SECTION 33. 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 Mortgage Loans 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 Mortgage Loans 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 Repurchase 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).

(e) This Repurchase Agreement is intended to be a “repurchase agreement” and a “securities
contract,” within the meaning of Section 555 and Section 559 under the Bankruptcy Code.

(f) The Sellers and the Buyer recognize that each Transaction is a “repurchase agreement” as
that term is defined in Section 101 of Title 11 of the United States Bankruptcy Code, as amended
(“USC”) (except insofar as the Purchased Asset subject to such Transaction or the term of such
Transaction would render such definition inapplicable), a “forward contract” as that term is
defined in Section 101 of Title 11 of the USC and a “securities contract” as that term is defined
in Section 741 of Title 11 of the USC (except insofar as the Purchased Assets subject to such
Transaction or the term of the Transaction would render such definition inapplicable), and that all
payments hereunder are deemed “margin payments” or “settlement payments” as defined in Title 11 of
the USC.

	 	 	SECTION 34. 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.

	 	 	SECTION 35. CONFLICTS

In the event of any conflict between the terms of this Repurchase Agreement, any other
Repurchase Document and any Confirmation, the documents shall control in the following order of
priority: first, the terms of the Confirmation shall prevail, then the terms of this
Repurchase Agreement shall prevail, and then the terms of the Repurchase Documents shall prevail.

	 	 	SECTION 36. AUTHORIZATIONS

Any of the persons whose signatures and titles appear on Exhibit X are authorized,
acting singly, to act for the Sellers or the Buyer, as the case may be, under this Repurchase
Agreement.

	 	 	SECTION 37. ACKNOWLEDGEMENT OF ANTI-PREDATORY LENDING POLICIES.

Buyer has in place internal policies and procedures that expressly prohibit its purchase of
any High Cost Mortgage Loan.

[THIS SPACE INTENTIONALLY LEFT BLANK]

4

IN WITNESS WHEREOF, the parties have entered into this Repurchase Agreement as of the
date set forth above.

BUYER:

MERRILL LYNCH BANK USA

By: /s/ James B. Cason

Name: James B. Cason

Title: Vice President

Address for Notices:

4 World Financial Center

10th Floor

New York, New York 10080

Attention: James B. Cason

Telecopier No.: (212) 738-2700

Telephone No.: (212) 449-1219

5

SELLER:

FIELDSTONE MORTGAGE COMPANY

By: /s/ Mark C. Krebs

Name: Mark C. Krebs

Title: Sr. Vice President & Treasurer

Address for Notices:

11000 Broken Land Parkway

Suite 600

Columbia, MD 21044

Attention: Mark Krebs

Telecopier No.: 443-367-2172

Telephone No.: 410-772-7275

SELLER:

FIELDSTONE INVESTMENT CORPORATION

By: /s/ Mark C. Krebs

Name: Mark C. Krebs

Title: Sr. Vice President & Treasurer

Address for Notices:

11000 Broken Land Parkway

Suite 600

Columbia, MD 21044

Attention: Mark Krebs

Telecopier No.: 443-367-2172

Telephone No.: 410-772-7275

6

SCHEDULE 1

PART A

REPRESENTATIONS AND WARRANTIES RE: PURCHASED MORTGAGE LOANS

The Sellers represent and warrant the following to the Buyer, with respect to each Mortgage
Loan, that as of the Purchase Date for the purchase of any Purchased Mortgage Loans by the Buyer
from the Sellers and as of the date of this Repurchase Agreement and any Transaction hereunder and
at all times while the Repurchase Documents and any Transaction hereunder is in full force and
effect. For purposes of this Schedule 1 and the representations and warranties set forth
herein, a breach of a representation or warranty shall be deemed to have been cured with respect to
a Mortgage Loan if and when the Sellers have taken or caused to be taken action such that the
event, circumstance or condition that gave rise to such breach no longer adversely affects such
Mortgage Loan. With respect to those representations and warranties which are made to the best of
the Sellers’ knowledge, if it is discovered by either Seller or the Buyer that the substance of
such representation and warranty is materially inaccurate, notwithstanding the Sellers’ lack of
knowledge with respect to the substance of such representation and warranty, such inaccuracy shall
be deemed a breach of the applicable representation and warranty.

(a) Description. The information set forth on the Asset Schedule is complete, true
and correct in all material respects as of the date of the origination of each such Mortgage Loan.

(b) No Defenses. No Mortgage Loan is subject to any right of rescission, set-off,
counterclaim or defense, including the defense of usury, nor will the operation of any of the terms
of the Mortgage Note or the Mortgage, or the exercise of any right thereunder, render either the
Mortgage Note or the Mortgage unenforceable, in whole or in part, or subject to any right of
rescission, set-off, counterclaim or defense, including the defense of usury, and no such right of
rescission, set-off, counterclaim or defense has been asserted with respect thereto.

(c) Original Terms Unmodified. Except as otherwise disclosed by written instruments
included in the related documents required to be held by the Custodian pursuant to the Custodial
Agreement with respect to such Mortgage Loan (the “Asset File”), the Sellers have not impaired,
waived, altered or modified the related Mortgage or Mortgage Note in any material respect, and, if
waived, altered or modified, the substance of any such waiver, alteration or modification has been
approved by the insurer under the PMI Policy, if any, and the title insurer, to the extent required
by the related policy, and its terms are reflected on the Asset Schedule. No Mortgagor has been
released, in whole or in part, except in connection with an assumption agreement approved by the
title insurer, and which assumption agreement is included in the Asset File delivered to Buyer or
its designee (including Custodian) and the terms of which are reflected in the Asset Schedule.

(d) No Outstanding Charges. All taxes, governmental assessments, insurance premiums,
water, sewer and municipal charges, leasehold payments or ground rents which previously became due
and owing have been paid, or an escrow of funds has been established in an amount sufficient to pay
for every such item that remains unpaid and that has been assessed but is not yet due and payable.
Sellers have not advanced funds, or induced, solicited or knowingly received any advance of funds
by a party other than the Mortgagor, directly or indirectly, for the payment of any amount required
under the Mortgage Loan, except for interest accruing from the date of the Mortgage Note or date of
disbursement of the proceeds of the Mortgage Loan, whichever is greater, to the day that precedes
by one month the Due Date of the first installment of principal and interest. No foreclosure
proceedings are pending against the Mortgaged Property and no material litigation or lawsuit
relating to the Mortgage Loan is pending.

(e) Title Insurance. Each Mortgage Loan is covered by either (i) a mortgage title
insurance policy or other generally acceptable form of insurance policy customary in the
jurisdiction where the Mortgaged Property is located or (ii) if generally acceptable in the
jurisdiction where the Mortgaged Property is located, an attorney’s opinion of title given by an
attorney licensed to practice law in the jurisdiction where the Mortgaged Property is located. All
of the Sellers’ rights under such policies, opinions or other instruments shall be deemed to be
transferred and assigned to the Buyer upon transfer and pledge of the Mortgage Loans hereunder.
The title insurance policy has been issued by a title insurer licensed to do business in the
jurisdiction where the Mortgaged Property is located, insuring the original lender, its successor
and assigns, as to the first or second priority lien of the Mortgage in the original principal
amount of the Mortgage Loan, subject to the exceptions contained in such policy. Each Seller is
the sole insured of such mortgagee title insurance policy, and such mortgagee title insurance
policy is in full force and effect and will be in force and effect upon the consummation of the
transactions contemplated by the Agreement. The Sellers have not made and have no knowledge of any
claims made under such mortgagee title insurance policy. The Sellers are not aware of any action
by a prior holder and the Sellers have not done, by act or omission, anything which could impair
the coverage or enforceability of such mortgagee title insurance policy or the accuracy of such
attorney’s opinion of title.

(f) Hazard Insurance. The Mortgage Loan obligates the Mortgagor thereunder to
maintain a hazard insurance policy (“Hazard Insurance”) in an amount at least equal to the lesser
of (i) the amount necessary to fully compensate for any damage or loss to the improvements which
are part of such Mortgaged Property on a replacement cost basis and (ii) the outstanding principal
balance of the Mortgage Loan, in either case in an amount sufficient to avoid the application of
any “co-insurance provisions”, and, if it was in place at origination of the Mortgage Loan, flood
insurance, at the Mortgagor’s cost and expense. If the Mortgaged Property is in an area identified
in the Federal Register by the Federal Emergency Management Agency (“FEMA”) as having special flood
hazards, a flood insurance policy is in effect which met the requirements of FEMA at the time such
policy was issued. The Mortgage obligates the Mortgagor to maintain the Hazard Insurance and, if
applicable, flood insurance policy at the Mortgagor’s cost and expense, and on the Mortgagor’s
failure to do so, authorizes the holder of the Mortgage to obtain and maintain such insurance at
the Mortgagor’s cost and expense, and to seek reimbursement therefor from the Mortgagor. The
Mortgaged Property is covered by Hazard Insurance. Each Seller has obtained a life of loan,
transferable flood certification contract for each Mortgage Loan and such contract is assignable
without penalty, premium or cost to the Buyer.

(g) Compliance with Applicable Laws. Any and all requirements of any federal, state
or local law including , but not limited to, usury, truth-in-lending, real estate settlement
procedures, consumer credit protection, equal credit opportunity and disclosure laws applicable to
the Mortgage Loan have been complied with, and Sellers shall maintain in one or both of their
possession, available for Buyer’s inspection, and shall deliver to Buyer upon demand, evidence of
compliance with all such requirements.

(h) No Satisfaction of Mortgage. The Mortgage has not been satisfied, canceled,
subordinated (except in the case of a Second Lien Mortgage Loan, to the first Mortgage Loan) or
rescinded, in whole or in part (except for a release that does not materially impair the security
of the Mortgage Loan or a release the effect of which is reflected in the loan-to-value ratio for
the Mortgage Loan as set forth in the Asset Schedule), and the Mortgaged Property has not been
released from the lien of the Mortgage, in whole or in part, nor has any instrument been executed
that would effect any such release, cancellation, subordination or rescission. Sellers have not
waived the performance by the Mortgagor of any action, if the Mortgagor’s failure to perform such
action would cause the Mortgage Loan to be in default, nor have Sellers waived any default
resulting from any action or inaction by the Mortgagor.

(i) Location and Type of Mortgage Property. The Mortgaged Property is located in the
state identified in the Asset Schedule and consists of either (i) a single parcel of real property
or (ii) more than one parcel of real property (as determined for tax purposes only) which parcels
are contiguous and are subject to a single deed or title, in each case with a detached single
family residence erected thereon, or a two- to four-family dwelling, or an individual condominium
unit in a low-rise or high-rise condominium project, provided, however, that any condominium
project or planned unit development shall conform with the applicable Fannie Mae and Freddie Mac
requirements regarding such dwellings, or a manufactured dwelling attached to a permanent
foundation, or an individual unit in a planned unit development or a townhouse. No residence or
dwelling is a mobile home.

(j) Valid First or Second Lien. The related Mortgage is a valid, subsisting and
enforceable first lien or second lien on the related Mortgaged Property, including but not limited
to, all building on the Mortgaged Property and all installations and mechanical, electrical,
plumbing, heating and air conditioning systems located in or annexed to such buildings, and all
additions, alterations and replacements made at any time with respect to the foregoing. The lien
of the Mortgage, to the best of the Sellers’ knowledge, is subject only to:

(i) the lien of current real property taxes and assessments not yet due and
payable;

(ii) covenants, conditions and restrictions, rights of way, easements and other
matters of public record as of the date of recording of such Mortgage, such
exceptions appearing of record being acceptable to mortgage lending institutions
generally or specifically reflected or considered in the lender’s title insurance
policy delivered to the originator of the Mortgage Loan and referred to or otherwise
considered in the appraisal made in connection with the origination of the related
Mortgage Loan or that do not adversely affect the appraisal value of the Mortgaged
Property set forth in such appraisal;

(iii) in the case of a Mortgaged Property that is a condominium or an
individual unit in a planned unit development, liens for common charges permitted by
statute;

(iv) if the Mortgage Loan is secured by a second mortgage lien on the Mortgaged
Property (and represented on the Mortgage Schedule as such), the lien of the first
Mortgage; and

(v) other matters to which like properties are commonly subject which do not
materially interfere with the benefits of the security intended to be provided by
such Mortgage or the use, enjoyment, value or marketability of the related Mortgaged
Property.

Any security agreement, chattel mortgage or equivalent document related to and delivered in
connection with the Mortgage Loan establishes and creates a valid and enforceable (a) with respect
to each first lien Mortgage Loan, first priority lien and first priority security interest, or (b)
with respect to each Second Lien Mortgage Loan, second priority lien and second priority security
interest, in each case, on the property described therein and the Sellers have full right to pledge
and assign the same to the Buyer or its designee (including Custodian).

(k) Validity of Mortgage Documents. The Mortgage Note and the Mortgage are genuine,
and each is the legal, valid and binding obligation of the maker thereof enforceable in accordance
with its terms, except as such enforcement may be limited by bankruptcy, insolvency,
reorganization, receivership, moratorium or other similar laws relating to or affecting the rights
of creditors generally, and by general equity principles (regardless of whether such enforcement is
considered in a proceeding in equity or at law). All parties to the Mortgage Note, the Mortgage and
any other such related agreement had legal capacity to enter into the Mortgage Loan and to execute
and deliver the Mortgage Note, the Mortgage and any such agreement, and the Mortgage Note, the
Mortgage and any other such related agreement have been duly and properly executed by such related
parties.

(l) Full Disbursement of Proceeds. The proceeds of the Mortgage Loan have been fully
disbursed to or for the account of the Mortgagor and there is no requirement for future advances
thereunder and there is no obligation for the mortgagee to advance additional funds thereunder, and
any and all requirements as to completion of any on-site or off-site improvement and as to
disbursements of any escrow funds therefore have been complied with. All costs, fees and expenses
incurred in making or closing the Mortgage Loan and the recording of the Mortgage were paid, and
the Mortgagor is not entitled to any refund of any amounts paid or due under the Mortgage Note or
Mortgage.

(m) Ownership. Sellers are the sole owners of record and holder of the Mortgage Loan.
The Mortgage Loan is not assigned or pledged except as provided in this Agreement, and Sellers
have good and marketable title thereto, and have full right to pledge and assign the Mortgage Loan
to Buyer or its designee (including Custodian) free and clear of any encumbrance, equity,
participation interest, lien, pledge, charge, claim or security interest, and have full right and
authority subject to no interest or participation of, or agreement with, any other party, to sell
and assign each Mortgage Loan pursuant to this Agreement.

(n) Doing Business. All parties that have had any interest in the Mortgage Loan,
whether as mortgagee, assignee, pledgee or otherwise, are (or, during the period in which they held
and disposed of such interest, were) (i) in compliance with any and all applicable licensing
requirements of the laws of the state where the Mortgaged Property is located, and (ii) either (A)
organized under the laws of such state, (B) qualified to do business in such state, (C) a federal
savings and loan association, a savings bank or a national bank having a principal office in such
state or (D) not doing business in such state; provided, if a warehouse lender that was the
assignee of the Mortgage Loans was not authorized to do business in the jurisdiction where the
Mortgaged Property is located, the Sellers represent and warrant that the financing of the Mortgage
Loan and the holding of an interest in the Mortgage Loan by the warehouse lender did not constitute
doing business in that jurisdiction.

(o) No Defaults. Other than a payment default, there is no material default, breach,
violation or event of acceleration existing under the Mortgage or the Mortgage Note and no event
which, with the passage of time or with notice and the expiration of any grace or cure period,
would constitute a material default, breach, violation or event of acceleration, and neither
Sellers nor their respective successors have waived any default, breach, violation or event of
acceleration.

(p) No Mechanics’ Liens. To the best of Sellers’ knowledge, there are no mechanics’
liens or similar liens or claims that have been filed for work, labor or material (and no rights
are outstanding that under law could give rise to such lien) affecting the Mortgaged Property that
are or may be liens prior to, or equal or coordinate with, the lien of the Mortgage.

(q) Location of Improvements; No Encroachments. Except as may be expressly noted and
considered in the appraisal of the Mortgaged Property, all improvements that were considered in
determining the appraised value of the Mortgaged Property lay wholly within the boundaries and
building restriction lines of the Mortgaged Property and no improvements on adjoining properties
encroach upon the Mortgaged Property unless there exists in the Asset File a title policy with
endorsements which insure against losses sustained by the insured as a result of such
encroachments. No improvement located on or being part of the Mortgaged Property is in violation
of any applicable zoning and building law, ordinance or regulation.

(r) Origination. The Mortgage Loan was originated by or in conjunction with a
mortgagee approved by the Secretary of Housing and Urban Development pursuant to Sections 203 and
211 of the National Housing Act, a savings and loan association, a savings bank, a commercial bank,
credit union, insurance company or similar banking institution which is supervised and examined by
a federal or state authority.

(s) Customary Provisions. The Mortgage contains customary and enforceable provisions
such as to render the rights and remedies of the holder thereof adequate for the realization
against the Mortgaged Property of the benefits of the security provided thereby, including, (i) in
the case of a Mortgage designated as a deed of trust, by trustee’s sale, and (ii) otherwise by
judicial foreclosure. There is no homestead or other exemption available to a Mortgagor which
would interfere with the right to sell the Mortgaged Property at a trustee’s sale or the right to
foreclose the Mortgage.

(t) Occupancy of the Mortgaged Property. To the best of the Sellers’ knowledge, (i)
as of the Purchase Date, the Mortgaged Property is lawfully occupied under applicable law and (ii)
all inspections, licenses and certificates required to be made or issued with respect to all
occupied portions of the Mortgaged Property and, with respect to the use and occupancy of the same,
including but not limited to certificates of occupancy and fire underwriting certificates, have
been made or obtained from the appropriate authorities. Sellers have not received notification
from any Governmental Authority that the Mortgaged Property is in material non-compliance with such
laws or regulations, is being used, operated or occupied unlawfully or has failed to have or obtain
such inspection, licenses or certificates, as the case may be. With respect to any Mortgage Loan
originated with an “owner-occupied” Mortgaged property, the Mortgagor represented at the time of
origination of the Mortgage Loan that the Mortgagor would occupy the Mortgaged Property as the
Mortgagor’s primary residence.

(u) No Additional Collateral. The Mortgage Note is not and has not been secured by
any collateral except the lien of the corresponding Mortgage and the security interest of any
applicable security agreement or chattel mortgage.

(v) Deeds of Trust. In the event the Mortgage constitutes a deed of trust, a trustee,
authorized and duly qualified under applicable law to serve as such, has been properly designated
and currently so serves and is named in the Mortgage, and no fees or expenses are or will become
payable by the Buyer to the trustee under the deed of trust, except in connection with a trustee’s
sale after default by the Mortgagor.

(w) Transfer of Mortgage Loans. Except with respect to Mortgage Loans registered with
MERS, the Assignment of Mortgage is in recordable form and is acceptable for recording under the
laws of the jurisdiction in which the Mortgaged Property is located.

(x) Due on Sale. The Mortgage contains an enforceable provision for the acceleration
of the payment of the unpaid principal balance of the Mortgage Loan in the event that the Mortgaged
Property is sold or transferred without the prior written consent of the mortgagee thereunder.

(y) No Buydown Provisions; No Graduated Payments or Contingent Interests. Except
with respect to Agency Mortgage Loans, the Mortgage Loan does not contain provisions pursuant to
which monthly payments are paid or partially paid with funds deposited in any separate account
established by Sellers, the Mortgagor or anyone on behalf of the Mortgagor, or paid by any source
other than the Mortgagor nor does it contain any other similar provisions which may constitute a
“buydown” provisions. The Mortgage Loan is not a graduated payment mortgage loan and the Mortgage
Loan does not have a shared appreciation or other contingent interest feature.

(z) Consolidation of Future Advances. Any future advances made to the Mortgagor prior
to the Purchase Date have been consolidated with the outstanding principal amount secured by the
Mortgage, and the secured principal amount, as consolidated, bears a single interest rate and
single repayment term. The lien of the Mortgage securing the consolidated principal amount is
expressly insured as having first or second lien priority, as the case may be, by a title
insurance policy, an endorsement to the policy insuring the mortgagee’s consolidated interest or by
other title evidence acceptable to Fannie Mae and Freddie Mac. The consolidated principal amount
does not exceed the original principal amount of the Mortgage Loan.

(aa) No Condemnation Proceedings; Mortgaged Property Undamaged. To the best of the
Sellers’ knowledge, there is no proceeding pending for the total or partial condemnation and no
eminent domain proceedings pending affecting any Mortgaged Property. Except as set forth in the
appraisal which forms part of the related Asset File, the Mortgaged Property, normal wear and tear
excepted, is undamaged by waste, fire, earthquake or earth movement, windstorm, flood, tornado or
other casualty so as to affect materially and adversely the value of the Mortgaged Property as
security for the Mortgage Loan or the use for which the premises were intended.

(bb) Collection Practices; Escrow Deposits; Interest Rate Adjustments. The
origination and collection practices used by the originator, each servicer of the Mortgage Loan and
the Sellers with respect to the Mortgage Loan have been operated in all respects in accordance with
industry custom and practice, applicable laws and regulations and have been legally and properly
operated. With respect to escrow deposits and escrow payments (other than with respect to each
Second Lien Mortgage and for which the mortgagee under the first lien is collecting escrow
payments), all such payments are in the possession of, or under the control of, one or both of the
Sellers and there exist no deficiencies in connection therewith for which customary arrangements
for repayment thereof have not been made. All escrow payments have been collected in full
compliance with state and federal law. If an escrow of funds has been established, it is not
prohibited by applicable law and has been established in an amount sufficient to pay for every item
that remains unpaid and has been assessed but is not yet due and payable. No escrow deposits or
escrow payments or other charges or payments due Sellers have been capitalized under the Mortgage
or the Mortgage Note. All mortgage interest rate adjustments have been made in strict compliance
with state and federal law and the terms of the related Mortgage Note. Any interest required to be
paid pursuant to state and local law has been properly paid and credited.

(cc) Appraisal. Unless indicated in the Sellers’ Underwriting Guidelines, the Asset
File for each Mortgage Loan contains an appraisal of the related Mortgaged Property indicating an
appraised value equal to the appraised value identified for such Mortgaged Property on the Mortgage
Loan, which appraisal is either (i) with respect to Conforming Mortgage Loans only, an automated
appraisal acceptable to an Agency or (ii) signed prior to the approval of the Mortgage Loan
application by a qualified appraiser, duly appointed by Sellers, who had no interest, direct or
indirect, in the Mortgaged Property or in any loan made on the security thereof and the appraiser
and appraisal both satisfy the requirements of Title XI of the Federal Institutions Reform,
Recovery and Enforcement Act of 1989 as amended and the regulations promulgated thereunder, all as
in effect on the date the Mortgage Loan was originated.

(dd) Servicemembers Civil Relief Act. The Mortgagor has not notified Sellers, and
Sellers have no knowledge, of any relief requested or allowed to the Mortgagor under the
Servicemembers Civil Relief Act of 2003.

(ee) Loan to Value Ratio. No Mortgage Loan has an LTV (“loan-to-value” ratio) or CLTV
in excess of 100%. Each Conforming Mortgage Loan with an LTV at origination in excess of 80% is
and will be subject to a lender paid Mortgage Insurance Policy or a PMI Policy, issued by a
Qualified Insurer, which insures that portion of the Mortgage Loan in excess of the portion of the
Appraised Value of the Mortgaged Property required by the applicable Underwriting Guidelines or
Agency. All provisions of such PMI Policy have been and are being complied with, such policy is in
full force and effect, and all premiums due thereunder have been paid. Any Mortgage subject to any
such PMI Policy obligates the Mortgagor thereunder to maintain such insurance and to pay all
premiums and charges in connection therewith. The Mortgage Interest Rate for the Mortgage Loan does
not include any such insurance premium.

(ff) Payment Terms. Principal payments on the Mortgage Loan commenced no more than
sixty (60) days after the proceeds of the Mortgage Loan were disbursed and the Mortgage Note is
payable on the first day of each month. As to each fixed rate Mortgage Loan, interest is calculated
on the Mortgage Note on the basis of twelve 30-day months and a 360-day year, and, as to each
adjustable rate Mortgage Loan, interest is calculated on the Mortgage Note on the basis of the
number of days in the related interest accrual period. The origination date is no earlier than
sixty (60) days prior to the related Purchase Date.

(gg) No Bankruptcy of Mortgagor. None of the Mortgage Loans are subject to a
bankruptcy plan. To the best of the Sellers’ knowledge, since the date of origination of the
Mortgage Loan, the Mortgaged Property has not been subject to any bankruptcy proceeding or
foreclosure proceeding and the Mortgagor has not filed for protection under applicable bankruptcy
laws. There is no homestead or other exemption available to the Mortgagor that would interfere
with the right to sell the Mortgaged Property at a trustee’s sale or the right to foreclose the
Mortgage.

(hh) Construction or Rehabilitation of Mortgaged Property. No Mortgage Loan was made
in connection with (a) the construction or rehabilitation of a Mortgaged Property or (b)
facilitating the trade-in or exchange of a Mortgaged Property.

(ii) Underwriting Guidelines. Each Mortgage Loan has been underwritten in all
material respects in accordance with the related Underwriting Guidelines in effect at the time the
Mortgage Loan was originated or purchased by the Sellers.

(jj) Condominium/Planned Unit Developments. If the Mortgaged Property is a
condominium or a planned unit development (other than a de minimus planned unit development), such
condominium or planned unit development project meets the Underwriting Guidelines.

(kk) Non-Eligible Assets. No Mortgage Loan (a) is subject to Section 226.32 of
Regulation Z or any similar state law (relating to high interest rate credit/lending transactions),
or (b) is a High Cost Mortgage Loan.

(ll) Environmental Actions. To the best of the Sellers’ knowledge, the Mortgaged
Property is in material compliance with all applicable local, state and federal environmental laws,
rules or regulations pertaining to environmental hazards including, without limitation, asbestos,
and neither the Sellers nor, to the best of the Sellers’ knowledge, the related Mortgagor, has
received any notice of any violation or potential violation of such law nor is there any pending
action or proceeding directly involving any Mortgaged Property of which the Sellers are aware in
which compliance with any environmental law, rule or regulation is an issue.

(mm) Documents Genuine. To the best of the Sellers’ knowledge, such Purchased
Mortgage Loans and all accompanying collateral documents are complete and authentic and all
signatures thereon are genuine. Such Purchased Mortgage Loan is a “closed” loan fully funded by
the Sellers.

(nn) FHA Mortgage Insurance; VA Loan Guaranty. With respect to the FHA Loans, the FHA
Mortgage Insurance Contract is in full force and effect and there exists no impairment to full
recovery without indemnity to the Department of Housing and Urban Development or the FHA under FHA
Mortgage Insurance. With respect to the VA Loans, the VA Loan Guaranty Agreement is in full force
and effect to the maximum extent stated therein. All necessary steps have been taken to keep such
guaranty or insurance valid, binding and enforceable and each of such is the binding, valid and
enforceable obligation of the FHA and the VA, respectively, to the full extent thereof, without
surcharge, set-off or defense. Each FHA Loan and VA Loan was originated in accordance with the
criteria of an Agency for purchase of such Mortgage Loans.

(oo) Primary Mortgage Guaranty Insurance. Each Mortgage Loan which is represented to
the Buyer to have, or to be eligible for, FHA insurance is insured, or eligible to be insured,
pursuant to the National Housing Act. Each Mortgage Loan which is represented by the Sellers to be
guaranteed, or to be eligible for guaranty, by the VA is guaranteed, or eligible to be guaranteed,
under the provisions of Chapter 37 of Title 38 of the United States Code. As to each FHA insurance
certificate or each VA guaranty certificate, the Sellers have complied with applicable provisions
of the insurance for guaranty contract and federal statutes and regulations, all premiums or other
charges due in connection with such insurance or guarantee have been paid, there has been no act or
omission which would or may invalidate any such insurance or guaranty, and the insurance or
guaranty is, or when issued, will be, in full force and effect with respect to each Mortgage Loan.
There are no defenses, counterclaims, or rights of set-off affecting the Mortgage Loans or
affecting the validity or enforceability of any private mortgage insurance or FHA insurance
applicable to the Mortgage Loans or any VA guaranty with respect to the Mortgage Loans.

(pp) Tax and Property Descriptions. To the best of the Sellers’ knowledge, except as
disclosed to the Buyer in writing, all tax identifications and property descriptions are legally
sufficient; and tax segregation, where required, has been completed. Each Seller has reviewed all
of the documents constituting the Asset File and has made such inquiries as it deems necessary to
make and confirm the accuracy of the representations set forth herein. To the best of the Sellers’
knowledge, except as disclosed to the Buyer in writing, all tax identifications and property
descriptions are legally sufficient; and tax segregation, where required, has been completed. Each
Seller has obtained a life of loan, transferable real estate tax service contract with an approved
tax service contract provider on each Mortgage Loan and such contract is assignable without
penalty, premium or cost to the Buyer. Each Seller has obtained a life of loan, transferable real
estate tax service contract with an approved tax service contract provider on each Mortgage Loan
and such contract is assignable without penalty, premium or cost to the Buyer.

(qq) Recordation. Each original Mortgage was or shall be recorded and, except for
those Mortgage Loans subject to the MERS identification system, all subsequent assignments of the
original Mortgage (other than the assignment to the Buyer) have been or shall be recorded in the
appropriate jurisdictions where such recordation is necessary to perfect the lien thereof as
against creditors of the Sellers, or is in the process of being recorded

(rr) Takeout Commitment. Each Takeout Commitment is a legal, valid and binding
obligation of the Sellers enforceable against each of them in accordance with its terms, subject to
applicable bankruptcy, insolvency and similar laws affecting creditors’ rights generally and
subject, as to enforceability, to general principles of equity (regardless of whether enforcement
is sought in a proceeding in equity or at law).

(ss) No Fraud. There was no fraud involved in the origination of the Mortgage Loan by
the mortgagee or, to the Sellers’ knowledge, by the Mortgagor, any appraiser or any other party
involved in the origination of the Mortgage Loan.

(tt) Interest. The Mortgage Loan bears interest at the mortgage interest rate and the
Mortgage Note does not permit negative amortization. None of the Mortgage Loans are simple
interest Mortgage Loans.

(uu) No Balloon Payment. No Mortgage Loan, other than a Balloon Loan, has a balloon
payment feature. No Balloon Loan requires payment of all outstanding principal earlier than
fifteen (15) years following the origination of the Balloon Loan.

(vv) Prepayment Penalty. With respect to each Mortgage Loan that has a prepayment
penalty feature, each such prepayment penalty is enforceable and will be enforced by the Seller,
and each prepayment penalty is permitted pursuant to federal, state and local law. No Mortgage
Loan will impose a prepayment penalty for a term in excess of five years from the date such
Mortgage Loan was originated. Except as otherwise set forth on the Asset Schedule, with respect to
each Mortgage Loan that contains a prepayment penalty, such prepayment penalty is at least equal to
the lesser of (A) the maximum amount permitted under applicable law and (B) six months interest at
the related Mortgage Interest Rate on the amount prepaid in excess of 20% of the original principal
balance of such Mortgage Loan.

(ww) No Single-Premium Credit Insurance Policies. None of the proceeds of the
Mortgage Loan were used to finance single-premium credit insurance policies.

PART B

REPRESENTATIONS WITH RESPECT TO REO PROPERTIES

Each Seller makes the following representations and warranties to the Buyer, with respect to
each REO Property subject to a Transaction, that as of the Purchase Date for the purchase of any
REO Property subject to a Transaction and as of the date of this Repurchase Agreement and any
Transaction hereunder relating to such REO Property is outstanding and at all times while the
Repurchase Documents and any Transaction hereunder are in full force and effect. For purposes of
this Schedule 1 and the representations and warranties set forth herein, a breach of a
representation or warranty shall be deemed to have been cured with respect to an REO Property if
and when the Sellers have taken or caused to be taken action such that the event, circumstance or
condition that gave rise to such breach no longer materially and adversely affects such REO
Property. With respect to those representations and warranties which are made to the best of the
Sellers’ knowledge, if it is discovered by the Sellers or the Buyer that the substance of such
representation and warranty is materially inaccurate, notwithstanding the Sellers’ lack of
knowledge with respect to the substance of such representation and warranty, such inaccuracy shall
be deemed a breach of the applicable representation and warranty.

(a) REO Properties as Described. The information set forth in the Asset Schedule with
respect to the REO Property is true and correct in all material respects.

(b) Hazard Insurance. Unless otherwise approved by the Buyer, the REO Property is
insured by a fire and extended perils insurance policy and against such other hazards as are
customary under Servicer’s servicing procedures in the area where the REO Property is located. If
any portion of the REO Property is in an area identified by any federal governmental authority as
having special flood hazards, and flood insurance is available, a flood insurance policy meeting
the current guidelines of the Federal Insurance Administration is in effect.

(c) No Lien. The REO Property is not subject to any Liens except:

(i) the lien of current real property taxes and assessments not yet due and
payable or due and payable;

(ii) covenants, conditions and restrictions, rights of way, easements and other
matters of the public record; and

(iii) other matters to which like properties are commonly subject which do not
materially interfere with the benefits of the security intended to be provided by
the REO Property or the use, enjoyment, value or marketability thereof, including
common charges regarding condominiums and planned unit developments.

(d) Ownership. The applicable Seller is the sole owner and holder of the REO
Property.

(e) No Mechanics’ Liens. Unless approved by the Buyer, there are not mechanics’ or
similar liens or claims which have been filed for work, labor or material affecting the REO
Property which are or may become liens against the REO Property.

(f) REO Property Undamaged. Unless otherwise set forth on the Asset Schedule, the REO
Property is undamaged by waste, fire, earthquake or earth movement, windstorm, flood, tornado or
other casualty in excess of insurance coverage so as to affect materially and adversely the value
of the REO Property. There have not been any condemnation proceedings with respect to the REO
Property and the Sellers have no knowledge of any such proceedings.

(g) Type of REO Property. The REO Property consists of a one-to-four family residence
erected thereon, or an individual condominium unit, or an individual unit in a planned unit
development or a de minimis planned unit development.

(h) REO Property. Each Seller or its Servicer shall not cause title to any REO
Property to be taken in the name of any person without the consent of Buyer.

(i) Real Property Tax. To the best of each Seller’s knowledge, all real property
taxes including supplemental or other taxes, if any, governmental assets, insurance premiums,
water, sewer and municipal charges, condominium charges and assessments, leasehold payments or
ground rents which previously became due and owing will have been paid by the Seller prior to any
penalty or interest accruing or proceeding commencing with respect thereto.

(j) Environmental Law. Each Seller has not received any written notice that there
exists a violation of any local, state or federal environmental law, rule or regulation with
respect to the REO Property.

(k) Doing Business. All parties which have had any interest in the REO Property,
whether as owner, assignee, pledgee or otherwise, are (or, during the period in which they held and
disposed of such interest, were) (1) in compliance with any and all applicable licensing
requirements of the laws of the state wherein the REO Property is located, and (2) organized under
the laws of such state, or (3) qualified to do business in such state, or (4) federal savings and
loan associations or national banks having principal offices in such state, or (5) not doing
business in such state.

(l) Asset File. The deed and any other documents required to be delivered by each
Seller under this Agreement have been delivered to the Custodian. Each Seller is in possession of
a complete, true and accurate Asset File, except for such documents the originals of which have
been delivered to the Custodian. The deed is in recordable form and is acceptable for recording
under the laws of the jurisdiction in which the REO Property is located.

(m) Eviction Proceedings. Each eviction proceeding relating to an REO Property has
been properly commenced and each Seller is not aware of any valid defense or counterclaim by anyone
with respect thereto. The REO Property has been serviced and maintained in compliance with all
applicable laws and regulations.

(n) Trustee’s Sale Guaranty. Each Seller will deliver a valid trustee’s sale
guaranty from a reputable title insurance company with respect to the REO Property, if same is
customarily provided in the related jurisdiction.

(o) No Violation of Law. There has been no violation of any law or regulation or
breach of any contractual obligation contained in any agreement included in the Asset File, by each
Seller or its predecessors, in connection with the management of the REO Property.

(p) No Cooperative Units. The REO Property is not a cooperative unit, except to the
extent the purchase of same has been approved in writing by the Buyer.

(q) Illegal Activity. There is no illegal activity being conducted on the REO
Property which could serve as the basis for a claim or prosecution of any action or proceeding
seeking to impose civil or criminal liability on the applicable Seller as the owner or the
Administrative Agent as assignee.

(r) Condominium Units. Solely with respect to REO Properties which are condominium
units, neither the Sellers nor any Affiliates are a “sponsor” or a nominee of a “sponsor” under any
plan of condominium organization affecting the unit and the ownership and sale of any condominium
unit will not violate any federal, state or local law or regulation regarding condominiums or
require registration, qualification or similar action under such law or regulation.

(s) Mechanic’s Liens. Neither the Sellers nor any Affiliates have performed any work
on the REO Property which could give rise to the filing of a mechanics’ or materialmen’s lien or
liens in the nature thereof.

(t) Listing Agreements. Each Seller has provided the Custodian or the Buyer with a
copy of each listing agreement with any real estate broker with respect to the REO Property. Each
such listing agreement may be terminated without any cost or expense to the Administrative Agent
and

(u) Lease Agreements Terminable. There are no existing lease agreements with any
tenant with respect to any REO Property which are not terminable upon thirty (30) days’ notice to
the tenant.

7EX-10.1

Exhibit 10.1

CONSULTING, CONFIDENTIALITY AND PROPRIETARY RIGHTS AGREEMENT

This Consulting, Confidentiality and Proprietary Rights Agreement (“Agreement”) is entered
into as of the 31st day of October, 2006, by and between VIASPACE Inc., a Nevada Corporation and
Denda Associates Co., Ltd. (“Consultant”).

WHEREAS, Company desires to engage Consultant to provide certain services as set forth on the
Schedule.

NOW, THEREFORE, in consideration of the foregoing and the mutual covenants and conditions
contained herein, the parties hereto agree as follows:

1. Engagement. The Company hereby engages Consultant to perform those duties set
forth in the Schedule attached hereto and such other duties as may be requested from time to time
by the Managers of the Company. Consultant hereby accepts such engagement upon the terms and
subject to conditions set forth in this Agreement.

2. Compensation. For the services rendered by Consultant under this Agreement, the
Company shall pay to Consultant the compensation specified in the Schedule, subject to the terms
and conditions set forth in this Agreement.

3. Term and Survivability. The term of this Agreement shall be for a period of as
specified in the Schedule beginning on the Effective Date. Notwithstanding the foregoing, either
party shall have the right to terminate this Agreement at any time, with or without cause,
effective immediately upon 30 days written notice to the other party.

Upon termination of this Agreement the following sections of this Agreement shall survive such
termination: Sections 3, 5, 6, 7, 8, 10, 12 and 13.

4. Costs and Expenses of Consultant’s Performance. All costs and expenses of
Consultant’s performance hereunder shall be borne by Consultant, unless the Company agrees in
writing to reimburse or pay such costs and expenses or as set forth on the Schedule attached
hereto.

5. Taxes. As an independent contractor, Consultant acknowledges and agrees that he
is solely responsible for the payment of any taxes and/or assessments imposed on account of the
payment of compensation to, or the performance of services by Consultant pursuant this Agreement,
including, without limitation, any unemployment insurance tax, federal and state income taxes,
federal Social Security (FICA) payments, and state disability insurance taxes. The Company shall
not make any withholdings or payments of said taxes or assessments with respect to amounts paid to
Consultant hereunder; provided, however, that if required by law or any governmental agency, the
Company shall withhold such taxes or assessments from amounts due Consultant, and any such
withholding shall be for Consultant’s account and shall not be reimbursed by the Company to
Consultant. Consultant expressly agrees to make all payments of such taxes, as and when the same
may become due and payable with respect to the compensation earned under this Agreement.

6. Confidentiality. Consultant agrees that Consultant will not, except when
required by applicable law or order of a court, during the term of this Agreement or thereafter,
disclose directly or indirectly to any person or entity, or copy, reproduce or use, any Trade
Secrets (as defined below) or Confidential Information (as defined below) or other information
treated as confidential by the Company known, learned or acquired by the Consultant during the
period of the Consultant’s engagement by the Company. For purposes of this Agreement,
“Confidential Information” shall mean any and all Trade Secrets, knowledge, data or know-how of the
Company, or of third parties in the possession of the Company, and any nonpublic technical,
training, financial and/or business information treated as confidential by the Company, whether or
not such information, knowledge, Trade Secret or data was conceived, originated, discovered or
developed by Consultant hereunder. For purposes of this Agreement, “Trade Secrets” shall include,
without limitation, any formula, concept, pattern, processes, designs, device, software, systems,
list of customers, training manuals, marketing or sales or service plans, business plans, marketing
plans, financial information, or compilation of information which is used in the Company’s
business. Any information of the Company which is not readily available to the public shall be
considered to be a Trade Secret unless the Company advises Consultant in writing otherwise.
Consultant acknowledges that all of the Confidential Information is proprietary to the Company and
is a special, valuable and unique asset of the business of the Company, and that Consultant’s past,
present and future engagement by the Company has created, creates and will continue to create a
relationship of confidence and trust between the Consultant and the Company with respect to the
Confidential Information. Furthermore, Consultant shall immediately notify the Company of any
information which comes to his attention which might indicate that there has been a loss of
confidentiality with respect to the Confidential Information. In such event, Consultant shall take
all reasonable steps within his power to limit the scope of such loss.

7. Return of the Company‘s Proprietary Materials. Consultant agrees to deliver
promptly to the Company on termination of this Agreement for whatever reason, or at any time the
Company may so request, all documents, records, artwork, designs, data, drawings, flowcharts,
listings, models, sketches, apparatus, notebooks, disks, notes, copies and similar repositories of
Confidential Information and any other documents of a confidential nature belonging to the Company,
including all copies, summaries, records, descriptions, modifications, drawings or adaptations of
such materials which Consultant may then possess or have under his control. Concurrently with the
return of such proprietary materials to the Company, Consultant agrees to deliver to the Company
such further agreements and assurances to ensure the confidentiality of proprietary materials.
Consultant further agrees that upon termination of this Agreement, Consultant shall not retain any
document, data or other material of any description containing any Confidential Information or
proprietary materials of the Company.

8. Assignment of Proprietary Rights. Other than the Proprietary Rights listed on
the Schedule attached hereto, Consultant hereby assigns and transfers to the Company all right,
title and interest that Consultant may have, if any, in and to all Proprietary Rights (whether or
not patentable or copyrightable) made, conceived, developed, written or first reduced to practice
by Consultant, whether solely or jointly with others, during the period of Consultant’s engagement
by the Company which relate in any manner to the actual or anticipated business or research and
development of the Company, or result from or are suggested by any task assigned to Consultant or
by any of the work Consultant has performed or may perform for the Company.

Consultant acknowledges and agrees that the Company shall have all right, title and interest
in, among other items, all research information and all documentation or manuals related thereto
that Consultant develops or prepares for the Company during the period of Consultant’s engagement
by the Company and that such work by Consultant shall be work made for hire and that the Company
shall be the sole author thereof for all purposes under applicable copyright and other intellectual
property laws. Other than the Proprietary Rights listed on the Schedule attached hereto, Consultant
represents and covenants to the Company that there are no Proprietary Rights relating to the
Company’s business which were made by Consultant prior to Consultant’s engagement by the Company.
Consultant agrees promptly to disclose in writing to the Company all Proprietary Rights in order to
permit the Company to claim rights to which he may be entitled under this Agreement. With respect
to all Proprietary Rights which are assigned to the Company pursuant to this Section 8, Consultant
will assist the Company in any reasonable manner to obtain for the Company’s benefit patents and
copyrights thereon in any and all jurisdictions as may be designated by the Company, and Consultant
will execute, when requested, patent and copyright applications and assignments thereof to the
Company, or other persons designated by the Company, and any other lawful documents deemed
necessary by the Company to carry out the purposes of this Agreement. Consultant will further
assist the Company in every way to enforce any patents, copyrights and other Proprietary Rights of
the Company.

9. Trade Secrets of Others. Consultant represents to the Company that his
performance of all the terms of this Agreement does not and will not breach any agreement to keep
in confidence proprietary information or trade secrets acquired by Consultant in confidence or in
trust prior to its engagement by the Company, and Consultant will not disclose to the Company, or
induce the Company to use, any confidential or proprietary information or material belonging to
others. Consultant agrees not to enter into any agreement, either written or oral, in conflict with
this Agreement.

10. Other Obligations. Consultant acknowledges that the Company, from time to time,
may have agreements with other persons which impose obligations or restrictions on the Company
regarding proprietary rights made or developed during the course of work thereunder or regarding
the confidential nature of such work. Consultant agrees to be bound by all such obligations and
restrictions and to take all action necessary to discharge the obligations of the Company
thereunder.

11. Independent Contractor. Consultant is an independent contractor and shall not be
deemed to be an employee or agent of the Company for any purpose whatsoever.

12. Indemnification.

(a) Consultant shall, at his own expense, defend, indemnify and hold harmless the Company and
its employees, officers, directors, licensees and agents from and against any and all liabilities,
claims, actions, losses, costs and expenses (including reasonable attorneys’ fees and
disbursements) (collectively, “Claims”) relating to or arising out of Consultant’s actual or
alleged (i) infringement of any United States patent, foreign letters patent, license, trademark,
copyright, trade secret or any other proprietary right; (ii) breach of this Agreement or any other
agreement; (iii) violation of any law, statute, ordinance, order, rule or regulation; or (iv) act
or omission in connection with the performance of any of the services called for by this Agreement,
or any negligence or intentional misconduct in connection with such performance; provided, however,
the foregoing shall not apply to any portion of such Claims to the extent it is found to have
resulted primarily and directly from the Company’s actual violation of any law, statute, ordinance,
order, rule or regulation or to the extent such Claim is found to be primarily and directly based
upon written information provided by the Company to Consultant.

(b) The Company shall, at its own expense, defend, indemnify and hold harmless the Consultant
from and against any and all Claims (i) relating to or arising out of the Company’s actual or
alleged violation of any law, statute, ordinance, order, rule or regulation; or (ii) to the extent
such Claim is primarily and directly based upon written information provided by the Company to
Consultant; provided, however, the foregoing shall not apply to any portion of such Claims to the
extent it is found to have resulted primarily and directly from Consultant’s (A) infringement of
any United States patent, foreign letters patent, license, trademark, copyright, trade secret or
any other proprietary right; (B) breach of this Agreement or any other agreement; (C) violation of
any law, statute, ordinance, order, rule or regulation; or (D) act or omission in connection with
the performance of any of the services called for by this Agreement, or any negligence or
intentional misconduct in connection with such performance.

13. Non-Solicit. Consultant will not, during the term this Agreement and for one year
thereafter, directly or indirectly (whether as an owner, partner, shareholder, agent, officer,
director, employee, independent contractor, consultant, or otherwise) with or through any
individual or entity: (i) employ, engage or solicit for employment any individual who is, or was at
any time during the twelve-month period immediately prior to the termination of this Agreement for
any reason, an employee of the Company, or otherwise seek to adversely influence or alter such
individual’s relationship with the Company; or (ii) solicit or encourage any individual or entity
that is, or was during the twelve-month period immediately prior to the termination of this
Agreement for any reason, a customer or vendor of the Company to terminate or otherwise alter his,
her or its relationship with the Company or any of its affiliates.

14. Equitable Remedies. In the event of a breach or threatened breach of the terms of
this Agreement by Consultant, the parties hereto acknowledge and agree that it would be difficult
to measure the damage to the Company from such breach, that injury to the Company from such breach
would be impossible to calculate and that monetary damages would therefore be an inadequate remedy
for any breach. Accordingly, the Company, in addition to any and all other rights which may be
available, shall have the right of specific performance, injunctive relief and other appropriate
equitable remedies to restrain any such breach or threatened breach without showing or proving any
actual damage to the Company.

15. Governing Law. This Agreement shall be governed, construed and interpreted in
accordance with the internal laws of the State of California. In the event a judicial proceeding is
necessary, the sole forum for resolving disputes arising under or relating to this Agreement are
the Municipal and Superior Courts for the County of Los Angeles, California or the Federal District
Court for the Central District of California and all related appellate courts, and the parties
hereby consent to the jurisdiction of such courts, and that venue shall be in Los Angeles County,
California.

16. Entire Agreement: Modifications and Amendments. The terms of this Agreement are
intended by the parties as a final expression of their agreement with respect-to such terms as are
included in this Agreement and may not be contradicted by evidence of any prior or contemporaneous
agreement. The Schedule referred to in this Agreement is incorporated into this Agreement by this
reference. This Agreement may not be modified, changed or supplemented, nor may any obligations
hereunder be waived or extensions of time for performance granted, except by written instrument
signed by the parties or by their agents duly authorized in writing or as otherwise expressly
permitted herein.

17. Attorneys Fees. Should any party institute any action or proceeding to enforce
this Agreement or any provision hereof, or for damages by reason of any alleged breach of this
Agreement or of any provision hereof, or for a declaration of rights hereunder, the prevailing
party in any such action or proceeding shall be entitled to receive from the other party all costs
and expenses, including reasonable attorneys’ fees, incurred by the prevailing party in connection
with such action or proceeding.

18. Prohibition of Assignment. This Agreement and the rights, duties and obligations
hereunder may not be assigned or delegated by Consultant without the prior written consent of the
Company. Any assignment of rights or delegation of duties or obligations hereunder made without
such prior written consent shall be void and of no effect.

19. Binding Effect: Successors and Assignment. This Agreement and the provisions
hereof shall be binding upon each of the parties, their successors and permitted assigns.

20. Validity. This Agreement is intended to be valid and enforceable in accordance
with its terms to the fullest extent permitted by law. If any provision of this Agreement is found
to be invalid or unenforceable by any court of competent Jurisdiction, the invalidity or
unenforceability of such provision shall not affect the validity or enforceability of all the
remaining provisions hereof.

21. Notices. All notices and other communications hereunder shall be in writing and,
unless otherwise provided herein, shall be deemed duly given if delivered personally or by telecopy
or mailed by registered or certified mail (return receipt requested) or by Federal Express or other
similar courier service to the parties at the following addresses or (at such other address for the
party as shall be specified by like notice):

(i) If to the Company:

VIASPACE Inc.

171 N. Altadena Dr.

Pasadena, CA 91107

Tel: (626) 768-3360

Fax: (626) 578-9063

Attn: Legal Department

(ii) If to the Consultant:

Denda Associates Co. Ltd

Yaesu Dai Bldg. 7F

1-1-1 Kyobashi, Chuo-Ku

Tokyo 104-0031 Japan

Tel: +81-3-3231-2701

Fax: +81-3-3231-2703

Attn: Norman Denda

Any such notice, demand or other communication shall be deemed to have been given on the date
personally delivered or as of the 5 days of the date mailed, as the case may be.

1

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

Consultant

     /S/ NOBUYUKI DENDA      

Norman Denda

VIASPACE INC.

By:     /S/ CARL KUKKONEN     

Name: Carl Kukkonen

Title: CEO

2

Schedule

	1.	 	Duties of Consultant:

Denda Associates will serve as representative of VIASPACE and its subsidiary companies
including Direct Methanol Fuel Cell Corporation (DMFCC) and Arroyo Sciences in Japan. Denda

Associates will use best efforts to make introductions to Japanese companies including at
the top level; assist VIASPACE to schedule meetings, follow-up on meetings, obtain
information on potential business relationships, explain DMFCC’s intellectual property
position and business model, perform liaison with the press and other functions as mutually
agreeable. The Consulting Agreement is entered into by VIASPACE Inc., but conditions
contained in the Agreement cover all VIASPACE Inc. subsidiaries including Arroyo Sciences
Inc, Direct Methanol Fuel Cell Corporation, and Ionfinity LLC.

	2.	 	Compensation of Consultant:

Cash: $6,667 per month plus commission and bonus described below

Commission: In addition to the cash compensation, a commission will be paid based on sales
to Approved Customers and on sales of Approved Products. An Approved Customer is a customer
that is approved in advance in writing by VIASPACE, and that Denda Associates has visited at
least twice on behalf of VIASPACE subsequent to such written approval. An Approved Product
is a product such as a DMFCC fuel cartridge that an Approved Customer agrees to use, but may
not be sold directly to the OEM. In order to qualify for a commission, the initial sales to
the Approved Customer must occur within twelve months of the termination of this Agreement
or a contract for an Approved Product must be signed within six months of the termination of
this Agreement. Commissions for an Approved Customer or for an Approved Product by such
Approved Customer are payable for a period of four years from the date on which VIASPACE
approved such customer in writing . For the avoidance of doubt, commissions are payable
after the termination of this Agreement, provided that this Agreement was not previously
terminated for cause by VIASPACE.

The commission rate in any year (measured from the date of this Agreement) is initially 5%
until a total commission of $40,000, in the aggregate, has been received by Denda
Associates. After that, the commission rate is then reduced to 3%.

The commission rate is based on total development funding and product sales, except for
Approved Product cartridge sales. For cartridge sales, the commission is based on the
difference between the revenue received by DMFCC for the cartridge and the amount paid by
DMFCC to obtain it.

Bonus: The following bonuses are available to Denda Associates if milestones described in
the following are met within 12 months of the signing of this agreement:

1. Upon signing of the first publicly acknowledged cartridge supply agreement with an OEM,
VIASPACE will recommend to the Board of Directors that Denda Associates be granted 50,000
shares of VIASPACE unregistered / restricted stock. 25,000 shares will be recommended for
subsequent publicly acknowledged cartridge supply agreements.

2. Upon signing of a publicly acknowledged contract exceeding $100,000, VIASPACE will
recommend to the Board of Directors that Denda Associates be granted 25,000 shares of
VIASPACE unregistered / restricted stock.

The term of this Agreement is automatically renewed unless notified 60 days prior to
expiration of the agreement.

3. Proprietary Rights of Consultant: None

4. Expenses: Any expenses to be charged to VIASPACE must be approved in advance.

3

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00112-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00112-of-00352.parquet"}]]