Document:

Amended and Joinder to 3rd Amended and Restated Repurchase Agmt.

 Exhibit 10.3 
  
 EXECUTION COPY 
  
 AMENDMENT AND JOINDER TO THIRD AMENDED AND RESTATED MASTER REPURCHASE AGREEMENT 
  
 Amendment and Joinder to Third Amended and Restated Master Repurchase Agreement, dated as of September 29, 2004
(“Amendment and Joinder”), among CDC Mortgage Capital Inc., a New York corporation, having an address at 9 West 57th Street, 36th Floor, New York, New York 10019 (“Buyer”), and New Century Mortgage
Corporation, a California corporation, having an address at 18400 Von Karman, Suite 1000, Irvine, California 92612 (“NCMC”), NC Residual II Corporation, a Delaware corporation, having an address at 18400 Von Karman, Suite 1000,
Irvine, California 92612 (“NCRC”), NC Capital Corporation, a California corporation, having an address at 18400 Von Karman, Suite 1000, Irvine, California 92612 (“NCCC”) and New Century Credit Corporation, a
California corporation, having an address at 18400 Von Karman, Suite 1000, Irvine, California 92612 (“New Century”, and together with NCMC, NCCC and NCRC, “Seller”). 
  
 W I T N E S S E
T H: 
  
 WHEREAS, Buyer, NCMC, NCCC, and NCRC are
parties to that certain Third Amended and Restated Master Purchase Agreement, dated as of September 10, 2004 (the “Existing Repurchase Agreement,” and as amended by this Amendment and Joinder, as may be amended from time to time, the
“Repurchase Agreement”); 
  
 WHEREAS, at the
present time, Buyer, NCMC, NCCC, and NCRC desire to amend the Existing Repurchase Agreement to permit New Century to become an additional Seller thereunder, as well as to modify certain other provisions therein; 
  
 WHEREAS, it is a condition precedent to this Amendment and Joinder that upon
completion of the Merger Transaction as defined below the Guarantor shall have executed and delivered a new Guarantee of the Repurchase Agreement, whereupon New Century TRS Holdings, Inc., f/k/a New Century Financial Corporation, a Delaware
corporation shall be released from its obligations under the existing guarantee. 
  
 NOW, THEREFORE, in consideration of the premises and mutual agreements set forth herein, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, Buyer, NCMC, NCCC,
NCRC, and New Century agree as follows: 
  
 SECTION 1. Defined
Terms. Capitalized terms used but not otherwise defined herein shall have the meanings given to them in the Repurchase Agreement. 
  
 (a) Section 2 of the Repurchase Agreement is hereby amended by deleting the definition of Guarantee and Guarantor and replacing them with the following:

  
 “Guarantee” shall mean the guarantee dated as
of September 29, 2004, as may be amended from time to time, made by Guarantor in favor of Buyer. 
  

 “Guarantor” shall mean New Century Financial Corporation, f/k/a, New Century REIT, Inc.,
a Maryland corporation. 
  
 (b) The Repurchase Agreement is hereby
amended by inserting the following definition: 
  
 “Merger
Transaction” shall mean the reorganization of New Century Financial Corporation (“NCFC”) and New Century REIT Inc., a Maryland corporation (“New Century REIT”), through the merger of NCFC and NC Merger Sub, Inc., a
wholly-owned subsidiary of New Century REIT, with and into NCFC, resulting in New Century REIT becoming the parent company of NCFC. 
  
 SECTION 2. Agreement and Joinder. New Century hereby agrees to all of the provisions of the Repurchase Agreement, and effective on the date hereof,
becomes a party to the Repurchase Agreement, as a seller, with the same effect as if New Century were an original signatory to the Repurchase Agreement. All references to Seller in the Repurchase Agreement shall be deemed to include New Century.

  
 SECTION 3. Representations and Covenants. New Century
hereby represents and warrants that the representations of Seller contained in Section 10 of the Repurchase Agreement and the covenants of Seller contained in Section 11 of the Repurchase Agreement are true and correct on and as of the date of this
Amendment and Joinder. 
  
 SECTION 4. Amendments. The
Repurchase Agreement is hereby amended as follows: 
  
 1. The
Repurchase Agreement is hereby amended to delete Section 10(w) in its entirety and insert the following: 
  
 “(w) REIT. Neither NCRC or the Guarantor have engaged in any material “prohibited transactions” as defined in Section
857(b)(6)(B)(iii) and (C) of the Code. Each of NCRC and the Guarantor for their current “tax year” (as defined in the Code) are and for all prior tax years subsequent to their election to be a real estate investment trust have been
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 their Form 1120-REIT filed with the United States
Internal Revenue Service for such year.” 
  
 2. The
Repurchase Agreement is hereby amended to delete each of Sections 12(n) and 12(o) in their entirety and insert the following: 
  
 “(n) upon the failure of NCRC or the Guarantor to at any time to 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 NCRC or the Guarantor of any material “prohibited transactions” as defined in Sections 857(b) and 856(c) of the Code; 
  

 (o) upon the failure by NCRC or the Guarantor to satisfy any of the following asset or
income tests: 
  
 (1) At the close of each
taxable year, at least 75 percent of such Person’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. 
  
 (2) At the close of each taxable year, at least 95 percent of such Person’s gross income consists of (i) the items of income described in paragraph 1 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 such Person’s 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. 
  
 (3) At the close of each quarter of such Person’s
taxable years, at least 75 percent of the value of such Person’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 such Person’s operations, but not including receivables purchased from another person), and government securities.

  
 (4) At the close of each quarter of each of
such Person’s taxable years, (i) not more than 25 percent of such Person’s total asset value will be represented by securities (other than those described in paragraph 3), (ii) not more than 20 percent of such Person’s total asset
value will be represented by securities of one or more taxable REIT subsidiaries, and (iii) (a) not more than 5 percent of the value of such Person’s total assets will be represented by securities of any one issuer (other than Government
securities and securities of taxable REIT subsidiaries), and (b) such Person’s 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 government
securities, securities of taxable REIT subsidiaries, and securities of a qualified REIT subsidiary within the meaning of Section 856(i) of the Code).” of any of the REIT qualification tests pursuant to Section 856(c) of the Code.”

  

 3. The Repurchase Agreement is hereby amended to delete Section 11 (m) in its entirety and insert the
following: 
  
 “(m) Maintenance of Tangible
Net Worth. Guarantor will at all times during each fiscal year maintain Tangible Net Worth of not less than the sum of (1) $750,000,000, and (2) fifty percent (50%) of all increases in shareholders’ equity in the Guarantor attributable to
issuances of common stock since October 1, 2004.” 
  
 SECTION
5. Effectiveness. 
  
 The closing for the amendment
of the Repurchase Agreement shall be subject to the condition precedent that (a) the Merger Transaction shall have been completed and (b) each of Guarantor, Seller and Buyer shall have executed and delivered the related closing documents as
specified below, duly executed by all signatories as required pursuant to the respective terms thereof: 
  
 1. this Amendment and Joinder; 
  
 2. an Opinion of Counsel of each Seller and the Guarantor, substantially in the form attached to the Repurchase Agreement. 
  
 3. the Second Amendment and Joinder to Custodial and Disbursement Agreement;

  
 4. the Amendment and Joinder to Account Agreement; 

 
 5. the Guarantee; 
  
 6. a Secretary’s Certificate of each Seller and the Guarantor, including
a good standing certificate and certified copies of the charter and by-laws (or equivalent documents) of each Seller or Guarantor as applicable, and of all corporate or other authority for each Seller or Guarantor as applicable, with respect to the
execution, delivery and performance of the Amendment and Joinder and the Guarantee and each other document to be delivered by each Seller or Guarantor, as applicable in connection herewith; 
  
 7. a UCC-1 financing statement with respect to New Century; and 

 
 8. such other documents as Buyer may request. 
  
 SECTION 6. Further Assurances. Seller hereby covenants and agrees with
Buyer that, from and after the date hereof, until the Repurchase Agreement is terminated, at any time and from time to time, upon the written request of Buyer, and at the sole expense of Seller, Seller will promptly and duly execute and deliver such
further instruments and documents and take such further actions as Buyer may reasonably request in order to effect the transactions contemplated hereby and to preserve the full benefits of the Repurchase Agreement and the rights and powers therein
granted. 
  

 SECTION 7. Limited Effect. Except as expressly amended and modified by this Amendment and Joinder,
the Repurchase Agreement shall continue to be, and shall remain, in full force and effect in accordance with its terms. 
  
 SECTION 8. Counterparts. This Amendment and Joinder may be executed by each of the parties hereto on any number of separate counterparts, each of
which shall be an original and all of which taken together shall constitute one and the same instrument. 
  
 SECTION 9. GOVERNING LAW. THIS AMENDMENT AND JOINDER SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK
WITHOUT REFERENCE TO THE CHOICE OF LAW PROVISIONS THEREOF. 
  
 [SIGNATURE PAGE FOLLOWS] 
  

 IN WITNESS WHEREOF, Buyer and Seller have caused their names to be duly signed hereto by their respective
officers thereunto duly authorized, all as of the date first above written. 
  

					
	CDC MORTGAGE CAPITAL INC.
		
	 By:
	 	 /s/ Anthony Malanga

	 	 	 Name:
	 	 Anthony Malanga

	 	 	 Title:
	 	 Managing Director

		
	 By:
	 	 /s/ Kathy Lynch

	 	 	 Name:
	 	 Kathy Lynch

	 	 	 Title:
	 	 Director

  

					
	NEW CENTURY MORTGAGE CORPORATION
		
	 By:
	 	 /s/ Kevin Cloyd

	 	 	 Name: Kevin Cloyd

	 	 	 Title: Executive Vice President

	
	NC CAPITAL CORPORATION
		
	 By:
	 	 /s/ Kevin Cloyd

	 	 	 Name: Kevin Cloyd

	 	 	 Title: President

	
	NC RESIDUAL II CORPORATION
		
	 By:
	 	 /s/ Kevin Cloyd

	 	 	 Name: Kevin Cloyd

	 	 	 Title: Executive Vice President

  

					
	 NEW CENTURY CREDIT CORPORATION

		
	 By:
	 	 /s/ Kevin Cloyd

	 	 	 Name: Kevin Cloyd

	 	 	 Title: Executive Vice President

  
 Acknowledged and Agreed:

  

			
	 NEW CENTURY FINANCIAL CORPORATION,

	 as Guarantor

		
	 By:
	 	 /s/ Kevin Cloyd

	 Name:
	 	 Kevin Cloyd

	 Title:
	 	 Executive Vice PresidentGuaranty, dated as of 10/01/2004

 Exhibit 10.4 
  
 EXECUTION COPY 
  
 GUARANTEE 
  
 GUARANTEE, dated as of September 29, 2004, made by New Century Financial Corporation, f/k/a New Century REIT, Inc. (the “Guarantor”), on
behalf of New Century Mortgage Corporation (“NCMC”), NC Capital Corporation (“NCCC”), NC Residual II Corporation (“NCRC”) and New Century Credit Corporation (“New Century”, and,
together with NCMC, NCCC and NCRC, the “Sellers”), in favor of CDC Mortgage Capital Inc. (“CDC”), a party to the Repurchase Agreement and the Custodial Agreement, each referred to below. 
  
 RECITALS 
  
 Pursuant to that certain Third Amended and Restated Master Repurchase Agreement, dated as of September 10, 2004, as amended
by that certain Amendment and Joinder to Third Amended and Restated Repurchase Agreement, dated as of September 29, 2004 (as amended, supplemented or otherwise modified from time to time, the “Repurchase Agreement”), between CDC and
the Sellers, the Sellers have agreed to sell, from time to time, to CDC certain mortgage loans (the “Mortgage Loans”) as whole loans upon the terms and subject to the conditions set forth therein. The Guarantor owns directly and
indirectly all interests in the Sellers. Pursuant to the terms of that certain Custodial and Disbursement Agreement, dated as of May 10, 2002, as amended by that certain Amendment and Joinder to Custodial and Disbursement Agreement, dated as of
September 10, 2004 and the Second Amendment and Joinder to Custodial and Disbursement Agreement, dated as of September 29, 2004 (the “Custodial Agreement”, and collectively with the Repurchase Agreement, the
“Agreements”), Deutsche Bank National Trust Company (the “Custodian”) is required to take possession of the Mortgages and the Mortgage Notes, along with certain other documents specified in the Agreements, as the
Custodian of CDC and any future purchaser, on several delivery dates, in accordance with the terms and conditions of the Custodial Agreement. It is a condition precedent to the obligation of CDC to purchase the Mortgage Loans under the Repurchase
Agreement that the Guarantor shall have executed and delivered this Guarantee with respect to any and all prior and future representations, warranties, covenants and other obligations (collectively, the “Obligations”) of the Sellers
with respect to CDC under each of the Repurchase Agreement and the Custodial Agreement. 
  
 NOW, THEREFORE, in consideration of the premises and to induce CDC to enter into the Repurchase Agreement and the Custodial Agreement, the Guarantor hereby agrees, for the benefit of CDC, as follows: 
  
 1. Defined Terms. 
  
 (a) Unless otherwise defined herein, terms defined in the Repurchase
Agreement and used herein shall have the meanings given to them in the Repurchase Agreement. 
  
 (b) The words “hereof,” “herein” and “hereunder” and words of similar import when used in this Guarantee shall refer to this Guarantee as a whole and not to any particular provision of
this Guarantee, and section and paragraph references are to this Guarantee unless otherwise specified. 
  

 (c) The meanings given to terms defined herein shall be equally applicable to both the singular and
plural forms of such terms. 
  
 2. Guarantee. 

 
 (a) The Guarantor hereby, unconditionally and irrevocably, guarantees, for
the benefit of CDC and its successors, indorsees, transferees and assigns, the prompt and complete payment and performance by the Sellers when such payment is due or performance required in accordance with the Obligations. 
  
 (b) Anything herein to the contrary notwithstanding, the maximum liability of
the Guarantor hereunder shall in no event exceed the amount which can be guaranteed by the Guarantor under applicable federal and state laws relating to the insolvency of the debtors. 
  
 (c) The Guarantor further agrees to pay any and all expenses (including, without limitation, all fees and disbursements of
counsel) which may be paid or incurred by CDC in enforcing, or obtaining advice of counsel in respect of, any rights with respect to, or collecting, any or all of the Obligations and/or enforcing any rights with respect to, or collecting against,
the Guarantor under this Guarantee. This Guarantee shall remain in full force and effect until the Obligations are performed and/or paid in full and the Agreements are terminated, notwithstanding that from time to time prior thereto the Sellers may
be free from any Obligations. 
  
 (d) No actions or payments made
by the Sellers, the Guarantor, any other guarantor or any other Person or received or collected by CDC from the Sellers, the Guarantor, any other guarantor or any other Person by virtue of any action or proceeding or any set-off or appropriation or
application at any time or from time to time in reduction of or in payment of the Obligations shall be deemed to modify, reduce, release or otherwise affect the liability of the Guarantor hereunder which shall, notwithstanding any such payment or
payments other than payments made by the Guarantor in respect of the Obligations or payments received or collected from the Guarantor in respect of the Obligations, remain liable for the Obligations hereunder until the Obligations are paid in full
and the Agreements are terminated. 
  
 (e) The Guarantor agrees
that whenever, at any time, or from time to time, it shall make any payment to CDC on account of its liability hereunder, it will notify CDC in writing that such payment or performance is made under this Guarantee for such purpose. 
  
 3. Right of Set-off. The Guarantor hereby irrevocably authorizes CDC
at any time and from time to time without notice to the Guarantor, any such notice being expressly waived by the Guarantor, to set-off and appropriate and apply 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 CDC to or for the credit or the account of the Guarantor,
or any part thereof in such amounts as CDC may elect, against and on account of the obligations and liabilities of the Guarantor to CDC hereunder and claims of every nature and description of CDC against the Guarantor, in any currency, whether
arising hereunder, or otherwise, as CDC may elect, whether or not CDC has made any demand for payment and 

  

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although such obligations, liabilities and claims may be contingent or unmatured. CDC shall notify the Guarantor promptly of any such set-off and the
application made by CDC, provided that the failure to give such notice shall not affect the validity of such set-off and application. The rights of CDC under this Section are in addition to other rights and remedies (including, without
limitation, other rights of set-off) which CDC may have. 
  
 4.
No Subrogation. Notwithstanding any payment or payments made by the Guarantor hereunder or any set off or application of funds of the Guarantor by CDC, the Guarantor shall not be entitled to be subrogated to any of the rights of CDC against
the Sellers or any other guarantor or any collateral security or guarantee or right of offset held by CDC for the payment of the Obligations, nor shall the Guarantor seek or be entitled to seek any contribution or reimbursement from the Sellers or
any other guarantor in respect of any payments made by the Guarantor hereunder, until all amounts owing to CDC are paid in full and the Agreements are terminated. If any amount shall be paid to the Guarantor on account of such subrogation rights at
any time when all of the Obligations shall not have been paid in full, such amount shall be held by the Guarantor in trust for CDC segregated from other funds of the Guarantor, and shall, forthwith upon receipt by the Guarantor, be turned over to
CDC, in the exact form received by the Guarantor (duly indorsed by the Guarantor to CDC, if required), to be applied against the Obligations, whether matured or unmatured, in such order as CDC may determine. 
  
 5. Amendments, etc. with respect to the Obligations; Waiver of Rights. The
Guarantor shall remain obligated hereunder notwithstanding that, without any reservation of rights against the Guarantor and without notice to or further assent by the Guarantor, any demand for repurchase or other performance or payment under any of
the Obligations made by CDC may be rescinded by such party and any of the Obligations continued, and the Obligations, or the liability of any other party upon or for any part thereof, or any collateral security or guarantee therefor or right of
offset with respect thereto, may, from time to time, in whole or in part, be renewed, extended, amended, modified, accelerated, compromised, waived, surrendered or released by CDC, and the Agreements and any other documents executed and delivered in
connection therewith may be amended, modified, supplemented or terminated, in whole or in part, as CDC may deem advisable from time to time, and any collateral security, guarantee or right of offset at any time held by CDC for the payment of the
Obligations may be sold, exchanged, waived, surrendered or released. CDC shall have no obligation to protect, secure, perfect or insure any lien at any time held by it as security for the Obligations or for this Guarantee or any property subject
thereto. When making any demand hereunder against the Guarantor, CDC may, but shall be under no obligation to, make a similar demand on the Sellers or any other guarantor, and any failure by CDC to make any such demand or to collect any payments
from the Sellers or any such other guarantor or any release of the Sellers or such other guarantor shall not relieve the Guarantor of its obligations or liabilities hereunder, and shall not impair or affect the rights and remedies, express or
implied, or as a matter of law, of CDC against the Guarantor. For the purposes hereof “demand” shall include the commencement and continuance of any legal proceedings. 
  
 6. Guarantee Absolute and Unconditional. The Guarantor waives any and all notice of the creation, renewal, extension
or accrual of any of the Obligations and notice of or proof of reliance by CDC upon this Guarantee or acceptance of this Guarantee, and any creation, renewal extension or accrual of any of the Obligations, shall conclusively be deemed to have been

  

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created, contracted or incurred, or renewed, extended, amended or waived, in reliance upon this Guarantee; and all dealings between the Sellers and the
Guarantor, on the one hand, and CDC and the Sellers, on the other hand, likewise shall be conclusively presumed to have been had or consummated in reliance upon this Guarantee. The Guarantor waives diligence, presentment, protest, demand for payment
and notice of default or nonpayment to or upon the Sellers or the Guarantor with respect to the Obligations. The Guarantor understands and agrees that this Guarantee shall be construed as a continuing, absolute and unconditional guarantee of payment
and not of collection without regard to (a) the validity, regularity or enforceability of the Repurchase Agreement, the Custodial Agreement, or any other document, any of the Obligations or any other collateral security therefor or guarantee or
right of offset with respect thereto at any time or from time to time held by CDC, (b) any defense, set-off or counterclaim (other than a defense of payment or performance) which may at any time be available to or be asserted by the Sellers against
CDC, or (c) any other circumstance whatsoever (with or without notice to or knowledge of the Sellers or the Guarantor) which constitutes, or might be construed to constitute, an equitable or legal discharge of the Sellers for the Obligations, or of
the Guarantor under this Guarantee, in bankruptcy or in any other instance. When pursuing its rights and remedies hereunder against the Guarantor, CDC may, but shall be under no obligation to, pursue such rights and remedies as it may have against
the Sellers or any other Person or against any collateral security or guarantee for the Obligations or any right of offset with respect thereto and any failure by CDC to pursue such other rights or remedies or to collect any payments from the
Sellers or any such other Person or to realize upon any such collateral security or guarantee or to exercise any such right of offset, or any release of the Sellers or any such other Person or any such collateral security, guarantee or right of
offset shall not relieve the Guarantor 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 CDC against the Guarantor. This Guarantee shall remain in full
force and effect and be binding in accordance with and to the extent of its terms upon the Guarantor and the successors and assigns thereof, and shall inure to the benefit of CDC, and its respective successors, indorsees, transferees and assigns,
until all the Obligations and the obligations of the Guarantor under this Guarantee shall have been satisfied by complete performance and payment in full and the Agreements shall be terminated, notwithstanding that from time to time during the term
of the Agreements the Guarantor may be free from any Obligations. 
  
 7. Reinstatement. This Guarantee shall continue to be effective, or be reinstated, as the case may be, if at any time payment and/or performance, or any part thereof, of any of the Obligations is rescinded or must otherwise be
restored or returned by CDC upon the insolvency, bankruptcy, dissolution, liquidation or reorganization of the Sellers or the Guarantor, or upon or as a result of the appointment of a receiver, intervenor or conservator of, or trustee or similar
officer for, the Sellers or the Guarantor or any substantial part of their respective property, or otherwise, all as though such payments had not been made. 
  
 8. Payments. The Guarantor hereby guarantees that payments hereunder will be paid to CDC without set-off or counterclaim in U.S. Dollars at the
office of CDC as specified in Section 8 of the Repurchase Agreement. 
  

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 9. Representations and Warranties. The Guarantor hereby represents and warrants that: 
  
 (a) it is duly organized, validly existing and in good standing under the
laws of the state of Maryland and has the corporate power and authority and the legal right to own and operate its property, to lease the property it operates as lessee and to conduct the business in which it is currently engaged; 
  
 (b) it has the corporate power and authority and the legal right to execute
and deliver, and to perform its obligations under, this Guarantee, and has taken all necessary corporate action to authorize its execution, delivery and performance of this Guarantee; 
  
 (c) this Guarantee has been duly executed and delivered on behalf of the Guarantor, and constitutes a legal, valid and
binding obligation of the Guarantor enforceable in accordance with its terms, subject to the effects of bankruptcy, insolvency, fraudulent conveyance, reorganization, moratorium and other similar laws relating to or affecting creditors’ rights
generally, general equitable principles (whether considered on a proceeding in equity or at law) and an implied covenant of good faith and fair dealing; 
  
 (d) neither the execution and delivery of this Guarantee, nor the fulfillment of or compliance with the terms and conditions of this Guarantee, will
conflict with or result in a breach of any of the terms, conditions or provisions of the Guarantor’s charter or by-laws or any legal restriction or any agreement or instrument to which the Guarantor is now a party or by which it is bound, or
constitute a default or result in an acceleration under any of the foregoing, or result in the violation of any law, rule, regulation, order, judgment or decree to which the Guarantor or its property is subject; 
  
 (e) no consent or authorization of, filing with, notice to, or other act by
or in respect of, any governmental authority or any other Person (including, without limitation, any stockholder or creditor of the Guarantor) is required in connection with the execution, delivery, performance, validity or enforceability of this
Guarantee; 
  
 (f) 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 Guarantor or any of its subsidiaries or affecting any of its properties before any
governmental authority which (i) questions or challenges the validity or enforceability of the Agreements or any action to be taken in connection with the transactions contemplated thereby, (ii) makes a claim or claims in an aggregate amount greater
than $500,000, or (iii) individually or in the aggregate, if adversely determined, could reasonably be likely to have a Material Adverse Effect (as defined in the Repurchase Agreement). 
  
 (g) it has good record and marketable title in fee simple to, or a valid leasehold interest in, all its real property, and
good title to, or a valid leasehold interest in, all its other property, and none of such property is subject to any lien of any nature whatsoever except such as are disclosed in the balance sheet referred to in Section 9(h) hereof; 
  
 (h) it has filed or caused to be filed all tax returns which, to its
knowledge, are required to be filed and has paid all taxes shown to be due and payable on said returns or on any assessments made against it or any of its property and all other taxes, fees or other charges imposed on it or any of its property by
any governmental authority (other than any amount or validity of which is 

  

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currently being contested in good faith by appropriate proceedings and with respect to which reserves in conformity with GAAP have been provided on the books
of the Guarantor); no tax lien has been filed, and, to the knowledge of the Guarantor, no claim is being asserted, with respect to any such tax, fee or other charge; and 
  
 (i) The consolidated balance sheet of the Guarantor as of December 31, 2003 and the related consolidated statements of
income and retained earnings and of cash flows for such fiscal year, reported on by KPMG LLC, copies of which have heretofore been furnished to CDC, are complete and correct and present fairly the financial condition of the Guarantor as at such
date, and the results of its operations and its cash flow for such fiscal year. The consolidated balance sheet of the Guarantor for the quarterly fiscal period as of March 31, 2004 and June 30, 2004 and its consolidated balance sheet as of March 31,
2004 and June 30, 2004 and the related consolidated statements of income and retained earnings and of cash flows for such period, certified by a responsible officer, copies of which have heretofore been furnished to CDC, are complete and correct and
present fairly the financial condition of the Guarantor as of such date, and the results of its operations and its cash flows for such periods (subject to normal year-end audit adjustments). All such financial statements, including the related
schedules and notes thereto, have been prepared in accordance with GAAP applied consistently throughout the periods involved (except as approved by such accountants or responsible officer, as the case may be, and as disclosed therein). At the date
of the most recent balance sheet referred to above, the Guarantor had no material guarantee obligation, contingent liability or liability for taxes, or any long-term lease or unusual forward or long-term commitment, including, without limitation,
any interest rate or foreign currency swap or exchange transaction or other financial derivative, which is not reflected in the foregoing statements or in the notes thereto. During the period from June 30, 2004, to and including the date hereof
there has been no sale, transfer or other disposition by the Guarantor of any material part of its business or property and no purchase or other acquisition of any business or property (including any capital stock of any other Person) material in
relation to the financial condition of the Guarantor at June 30, 2004. 
  
 10. Notices. All notices, requests and demands which are required or permitted to be given under this Guarantee shall be in writing (or by telex, fax or similar electronic transfer confirmed in writing) and shall be deemed to have
been duly given or made (1) when delivered by hand or (2) if given by mail, when deposited in the mails by certified mail, return receipt requested, or (3) if by telex, fax or similar electronic transfer, when sent and receipt has been confirmed,
addressed as follows: 
  
 (a) if to CDC or to the Sellers, at
their respective addresses or transmission numbers for notices provided in Section 17 of the Repurchase Agreement; and 
  
 (b) if to the Guarantor, at its address or transmission number for notices set forth under its signature below. 
  
 CDC, the Sellers and the Guarantor may change its address
and transmission numbers for notices by notice in the manner provided in this Section. 
  
 11. Severability. Any provision of this Guarantee which is prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such prohibition or 

  

 -6- 

 
unenforceability without invalidating the remaining provisions hereof, and any such prohibition or unenforceability in any jurisdiction shall not invalidate
or render unenforceable such provision in any other jurisdiction. 
  
 12. Integration. This Guarantee represents the agreement of the Guarantor with respect to the subject matter hereof. 
  
 13. Amendments in Writing; No Waiver; Cumulative Remedies. 
  

(a) None of the terms or provisions of this Guarantee may be waived, amended, supplemented or otherwise modified except by a written instrument
executed by the Guarantor, the Sellers and CDC. 
  
 (b) CDC shall
not by any act, delay, indulgence, omission or otherwise be deemed to have waived any right or remedy hereunder or to have acquiesced in any breach of any of the terms and conditions hereof. No failure to exercise, nor any delay in exercising, on
the part of CDC, any right, power or privilege hereunder shall operate as a waiver thereof. No single or partial exercise of any right, power or privilege hereunder shall preclude any other or further exercise thereof or the exercise of any other
right, power or privilege. A waiver by CDC of any right or remedy hereunder on any one occasion shall not be construed as a bar to any right or remedy which CDC would otherwise have on any future occasion. 
  
 The rights and remedies herein provided are cumulative, may
be exercised singly or concurrently and are not exclusive of any other rights or remedies provided by law. 
  
 14. Section Headings. The section headings used in this Guarantee are for convenience of reference only and are not to affect the construction
hereof or be taken into consideration in the interpretation hereof. 
  
 15. Successors and Assigns. This Guarantee shall be binding upon the successors and assigns of the Guarantor and shall inure to the benefit of CDC and its successors and assigns. This Guarantee may not be assigned by the Guarantor
without the prior written consent of CDC, which consent shall be at CDC’s sole discretion. This Guarantee may be assigned by CDC without the consent of the Guarantor to any assignee of the Repurchase Agreement. 
  
 16. GOVERNING LAW. THIS GUARANTEE SHALL BE GOVERNED BY, AND CONSTRUED
IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK WITHOUT REGARD TO CONFLICTS OF LAW PRINCIPALS. 
  
 17. SUBMISSION TO JURISDICTION; WAIVERS. THE GUARANTOR HEREBY IRREVOCABLY AND UNCONDITIONALLY: 
  
 (a) SUBMITS FOR ITSELF AND ITS PROPERTY IN ANY LEGAL ACTION OR PROCEEDING
RELATING TO THIS GUARANTEE AND THE AGREEMENTS, 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 

  

 -7- 

 
SOUTHERN DISTRICT OF NEW YORK, AND APPELLATE COURTS FROM ANY THEREOF; 
  
 (b) 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; 
  
 (c) 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 CDC SHALL HAVE BEEN NOTIFIED; AND

  
 (d) 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. 
  
 (e) CDC AND GUARANTOR HEREBY IRREVOCABLY WAIVE, 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 GUARANTEE, THE AGREEMENTS, OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY. 
  
 (f) WAIVES, TO THE MAXIMUM EXTENT NOT PROHIBITED BY LAW, ANY RIGHT IT MAY HAVE TO CLAIM OR RECOVER IN ANY LEGAL ACTION OR PROCEEDING REFERRED TO IN THIS
SECTION ANY SPECIAL, EXEMPLARY, PUNITIVE OR CONSEQUENTIAL DAMAGES. 
  
 18. Acknowledgments. The Guarantor hereby acknowledges that: 
  
 (a) it has been advised by counsel in the negotiation, execution and delivery of this Guarantee; 
  
 (b) CDC does not have any fiduciary relationship with or duty to the Guarantor arising out of or in connection with this Guarantee, and the relationship
between the Guarantor, the Sellers and CDC; and 
  
 (c) no joint
venture is created hereby or otherwise exists by virtue of the transactions contemplated hereby among the Guarantor, the Sellers and CDC. 
  
 19. WAIVER OF JURY TRIAL. THE GUARANTOR HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVES TRIAL BY JURY IN ANY LEGAL ACTION OR PROCEEDING RELATING TO
THIS GUARANTEE OR ANY OTHER DOCUMENT RELATING HERETO OR THE MORTGAGE LOANS AND FOR ANY COUNTERCLAIM THEREIN. 
  

 -8- 

 IN WITNESS WHEREOF, the undersigned has caused this Guarantee to be duly executed and delivered by its
duly authorized officer as of the day and year first above written. 
  

			
	 NEW CENTURY FINANCIAL CORPORATION

		
	 By:
	 	 /s/ Kevin Cloyd

	 	 	 Title: Executive Vice President

		
	 By:
	 	 /s/ Brad A. Morrice

	 	 	 Title: President

	
	 Address for Notices:
18400 Von Karman, Suite 1000
Irvine, CA 92612
Telex:
                                        
    
Fax: (949) 440-7033

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