Financed Management Investment Agreement

EXHIBIT 10.10(b)


FINANCED MANAGEMENT INVESTMENT AGREEMENT


This FINANCED MANAGEMENT INVESTMENT AGREEMENT (this "AGREEMENT") dated as of August 4, 2000, is hereby made between Aames Financial Corporation, a Delaware corporation (the "COMPANY"), and A. Jay Meyerson, an individual residing at [XXXADDRESS DELETED FOR PRIVACYXXX] (the "MANAGEMENT INVESTOR").


WHEREAS, the Management Investor is a senior management employee of the Company; and


WHEREAS, the Management Investor entered into a Management Investment Agreement with the Company, dated October 25, 1999 (the "Original Management Investment Agreement"), to purchase from the Company, shares of the Company's Series C Convertible Preferred Stock, par value $0.001 per share ("SERIES C PREFERRED STOCK); and


WHEREAS, the Management Investor and the Company desire to amend the Original Management Investment Agreement to sell to the Management Investor, shares of the Company's Series D Convertible Preferred Stock, par value $0.001 per share ("SERIES D PREFERRED STOCK"), under the terms and conditions set forth in this Agreement and in that certain Non-Financed Management Agreement entered into on this day between the Management Investor and the Company whereby the Management Investor will purchase additional Shares of Series D Preferred Stock (the "Non-Financed Management Investment Agreement").


NOW THEREFORE, in consideration of the premises and the mutual covenants contained in this Agreement, and other good and valuable consideration, the sufficiency of which is hereby acknowledged, the parties hereto agree as follows:


SECTION 1. SALE AND DELIVERY.


(a) Upon the terms and subject to the conditions set forth herein, and in reliance upon the representations and warranties of the Management Investor hereinafter set forth, the Company shall issue, sell and deliver to the Management Investor, and the Management Investor shall purchase from the Company, 294,117 shares of Series D Preferred Stock (such shares of Series D Preferred Stock are referred to collectively herein as the "SHARES") at the price per share equal to $0.85.


(b) The purchase price for the Shares being purchased by the Management Investor shall be paid by delivery by the


Management Investor to the Company of (i) $294.12 (the "Closing Payment") and (ii)a 6.5% recourse promissory note having an original principal amount equal to the total purchase price of the Shares minus the Closing Payment (the "NOTE"), which Note is attached hereto as EXHIBIT A.


(c) The purchase and sale of Shares shall occur at the time and place specified by the Company for such closing, which shall be not more than 60 days after the date hereof (the "CLOSING DATE"), and at the closing of such purchase and sale of Shares:


(i) the Company shall deliver to the Management Investor
certificates representing the Shares (the "Certificates"), duly
endorsed for transfer, transferring to the Management Investor good and
marketable title to such Shares, free and clear of all liens and
encumbrances; and


(ii) the Management Investor shall deliver to the Company:


(A) the Closing Payment;


(B) the Note; and


(C) a pledge agreement (the "PLEDGE AGREEMENT")
attached hereto as EXHIBIT B, pursuant to which Pledge
Agreement, among other things, the Management Investor's
obligations under the Note shall be secured by the following:
(i) a pledge of (a) the Shares, (b) the shares of Common Stock
that may be acquired upon conversion of the Shares (the
"UNDERLYING COMMON SHARES"), and (c) certain other collateral
described therein; and (ii) delivery of the Certificates.


SECTION 2. REPRESENTATIONS AND WARRANTIES OF THE MANAGEMENT INVESTOR. The Management Investor hereby represents and warrants to the Company as follows:


(a) The Shares (and the Underlying Common Shares) to be purchased by such Management Investor will be acquired for investment for the Management Investor's own account and not with a view to the resale or distribution of any part thereof, except in compliance with the provisions of the Securities Act of 1933, as amended (the "SECURITIES ACT"), or an exemption therefrom, and in compliance with the terms of this Agreement. The Management Investor is a senior management employee of the Company and is fully familiar with the business of the Company and with the risks associated with the purchase of the Shares pursuant to this


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Agreement. The Management Investor is an accredited investor as defined under Rule 501(a) under the Securities Act.


(b) The Management Investor understands that the Shares and the Underlying Common Shares are characterized as "restricted securities" under the federal securities laws inasmuch as they are being acquired from the Company in a transaction not involving a public offering and that under such laws and applicable regulations such Shares (and the Underlying Common Shares) may be resold without registration under the Securities Act only in certain limited circumstances.


(c) The Management Investor further agrees that each certificate representing the Shares (and the Underlying Common Shares) shall be stamped or otherwise imprinted with a legend substantially in the following form:


"THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933 AND MAY NOT BE
TRANSFERRED OR OTHERWISE DISPOSED OF UNLESS SUCH SECURITIES
HAVE BEEN REGISTERED UNDER ACT OR AN EXEMPTION FROM
REGISTRATION IS AVAILABLE.


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