Form 8-Kk
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
December 7, 2007
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
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(State or other jurisdiction of (Commission File (I.R.S. Employer
incorporation or organization) Number) Identification No.)
8140 Ward Parkway, Suite 300, Kansas City, MO 64114
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(Address of principal executive offices)
(Zip Code)
(816) 237-7000
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(Registrant's telephone number, including area code)
Not Applicable
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(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:
[ ] 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))
Item 1.01 Entry into a Material Definitive Agreement
On December 7, 2007, NovaStar Financial, Inc. and certain of its affiliates (the
"Company") entered into a Master Repurchase Agreements Waiver ("Waiver
Agreement") with Wachovia Bank, N.A. and certain of its affiliates ("Wachovia")
pursuant to which, for a period ending on January 4, 2008 (the "Waiver Period"),
Wachovia agreed not to enforce, and waived any breach or event of default that
would otherwise have resulted solely from the Company's failure to comply with,
the requirement under the Agreements described below that the Company maintain a
specified adjusted tangible net worth. Further, the requirement under the
Agreements that the Company maintain liquidity of at least $30 million was
amended to require the Company to maintain liquidity of at least $24 million
during the Waiver Period. Wachovia expressly reserved the right to terminate the
Waiver Agreement prior to January 4, 2008, if any other event of default or
breach occurs under the Agreements other than as described above.
The agreements affected by this Waiver Agreement are the following (the
"Agreements"):
1. Master Repurchase Agreement (2007 Residual Securities) dated as of April
18, 2007, among Wachovia Investment Holdings, LLC, Wachovia Capital Markets,
LLC, NovaStar Mortgage, Inc., NovaStar Certificates Financing LLC, and NovaStar
Certificates Financing Corp.
2. Master Repurchase Agreement (2007 Whole Loan) dated as of May 9, 2007,
among Wachovia Bank, National Association, NFI Repurchase Corporation, NMI
Repurchase Corporation, NMI Property Financing, Inc., HomeView Lending, Inc.,
NovaStar Financial Inc., NFI Holding Corporation and NovaStar Mortgage, Inc.
3. Master Repurchase Agreement (2007 Non-investment Grade) dated as of May
31, 2007, among Wachovia Investment Holdings, LLC, Wachovia Capital Markets,
LLC, NovaStar Mortgage, Inc., NovaStar Certificates Financing LLC, and NovaStar
Certificates Financing Corp.
4. Master Repurchase Agreement (2007 Investment Grade) dated as of May 31,
2007, among Wachovia Bank, N. A., Wachovia Capital Markets, LLC, NovaStar
Mortgage, Inc., NovaStar Certificates Financing LLC, and NovaStar Certificates
Financing Corp.
5. Master Repurchase Agreement (New York) dated as of July 6, 2007, between
Wachovia Bank, National Association and NovaStar Mortgage, Inc.
In addition to the financing agreements listed above, Wachovia also routinely
engages in other ordinary course financial transactions with the Company,
including but not limited to financial derivative transactions, and has acted as
an underwriter for certain securitizations sponsored by the Company.
The foregoing is a summary of the terms of the Waiver Agreement. This summary is
qualified in its entirety by reference to the full text of the Waiver Agreement,
which is attached hereto as Exhibit 10.1 and is incorporated herein by
reference.
Item 9.01 Financial Statement and Exhibits
(d) Exhibits.
Exhibit No. Document
10.1 Master Repurchase Agreements Waiver, dated December 7, 2007, by and
among NovaStar Mortgage, Inc., NovaStar Certificates Financing LLC,
NovaStar Certificates Financing Corporation, NFI Repurchase
Corporation, NMI Repurchase Corporation, NMI Property Financing, Inc.,
HomeView Lending, Inc., NovaStar Financial, Inc., NFI Holding
Corporation, Wachovia Bank, N.A. and Wachovia Investment Holdings,
LLC.
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 hereunto duly authorized.
NOVASTAR FINANCIAL, INC.
DATE: December 10, 2007 /s/ GREGORY S. METZ
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Gregory S. Metz
Chief Financial Officer
Index to Exhibits
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Exhibit No. Document
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10.1 Master Repurchase Agreements Waiver, dated December 7, 2007, by and
among NovaStar Mortgage, Inc., NovaStar Certificates Financing LLC,
NovaStar Certificates Financing Corporation, NFI Repurchase
Corporation, NMI Repurchase Corporation, NMI Property Financing, Inc.,
HomeView Lending, Inc., NovaStar Financial, Inc., NFI Holding
Corporation, Wachovia Bank, N.A. and Wachovia Investment Holdings,
LLC.