UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
Washington,
D.C. 20549
FORM
8-K
CURRENT
REPORT
PURSUANT
TO SECTION 13 OR 15(d) OF THE
SECURITIES
EXCHANGE ACT OF 1934
April
26, 2009
Date
of Report (Date of earliest event reported)
NOVASTAR
FINANCIAL, INC.
(Exact
name of registrant as specified in its charter)
|
|
|
|
|
|
|
Maryland
|
|
001-13533
|
|
74-2830661
|
|
(State
or other jurisdiction of
incorporation
or organization)
|
|
(Commission
File Number)
|
|
(I.R.S.
Employer
Identification
No.)
|
2114
Central Street, Suite 600, Kansas City, MO 64108
(Address
of principal executive offices) (Zip Code)
(816)
237-7000
(Registrant’s
telephone number, including area code)
Not
Applicable
(Former
Name or Former Address, if Changed Since Last Report)
Check the
appropriate box below if the Form 8-K filing is intended to simultaneously
satisfy the filing obligation of the registrant under any of the following
provisions (see General Instruction A.2. below):
|
¨
|
Written
communications pursuant to Rule 425 under the Securities Act (17 CFR
230.425)
|
|
¨
|
Soliciting
material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
240.14a-12)
|
|
¨
|
Pre-commencement
communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR
240.14d-2(b))
|
|
¨
|
Pre-commencement
communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR
240.13e-4(c))
|
INFORMATION
TO BE INCLUDED IN THE REPORT
Item
1.01 – Entry into a Material Definitive Agreement.
On April
26, 2009, NovaStar Financial, Inc. (“NovaStar”) entered into a Securities
Purchase Agreement (the “Purchase Agreement”) with Advent Financial Services,
LLC (“Advent”) and Mark A. Ernst (“Ernst”). Advent is a start-up
company with the goal of providing tailored banking accounts and low cost
small-dollar banking services to meet the needs of underserved low- and
moderate-income consumers. Pursuant to the Purchase Agreement,
NovaStar will acquire 70% of the fully diluted membership interests in Advent in
exchange for an initial payment of $2,000,000 and, upon Advent’s achievement of
certain financial metrics for the twelve months ended April 30, 2010, an
additional payment of $2,000,000. The closing of the
transaction is expected to occur upon the satisfaction of the closing conditions
set forth in the Purchase Agreement.
The Purchase Agreement contains
customary representations, warranties and covenants by the parties and includes
customary termination provisions. There can be no assurance that the
closing contemplated by the Purchase Agreement will occur. The
description contained herein of the Purchase Agreement is qualified in its
entirety by reference to the terms of the Purchase Agreement attached hereto as
an exhibit and incorporated herein by this reference.
Item
2.03 – Creation of a Direct Financial Obligation or an Obligation under an
Off-Balance Sheet Arrangement of a Registrant.
See Item
8.01 below.
Item
8.01 – Other Events.
As part of the settlement, the existing
preferred obligations would be exchanged for new preferred
obligations. The settlement and exchange of the preferred obligations
were contingent upon, among other things, the dismissal of the petition for
involuntary Chapter 7 bankruptcy entitled In re NovaStar Mortgage, Inc. (Case
No. 08-12125-CSS) filed against NMI by the holders of the trust preferred
securities in U.S. Bankruptcy Court for the District of Delaware in Wilmington,
Delaware (the “Bankruptcy Court”). On March 9, 2009 the Bankruptcy
Court entered an order dismissing the involuntary proceeding.
On April 27, 2009 (the “Exchange
Date”) the parties completed the exchange of the existing preferred obligations
for new preferred obligations. On the Exchange Date, NovaStar
paid interest due through December 31, 2008, in the aggregate amount of $5.3
million and $0.3 million in legal and administrative costs on behalf of the
Trusts.
Item
9.01 – Financial Statements and Exhibits
|
(c)
|
Exhibits
|
|
10.62
|
Securities
Purchase Agreement, dated as of April 26, 2009, by and among NovaStar
Financial, Inc., Advent Financial Services, LLC and Mark A.
Ernst.
|
SIGNATURE
Pursuant
to the requirements of the Securities Exchange Act of 1934, the registrant has
duly caused this report to be signed on its behalf by the undersigned thereunto
duly authorized.
|
|
|
|
|
|
|
|
NOVASTAR
FINANCIAL, INC.
|
|
| |
|
|
|
|
|
|
|
|
DATE:
April 30, 2009
|
|
/s/ Rodney E. Schwatken
|
|
|
|
|
Rodney
E. Schwatken
|
|
|
|
|
Chief
Financial Officer
|
|