Form 8-K
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
February 4, 2008
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 February 4, 2008, 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 February 11, 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
$20 million during the Waiver Period. Wachovia expressly reserved the right to
terminate the Waiver Agreement prior to February 11, 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"), copies of which have previously been filed with the Securities
and Exchange Commission:
1. Master Repurchase Agreement (2007 Whole Loan) dated as of May 9, 2007
(the "Whole Loan Agreement"), 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.
2. Master Repurchase Agreement (2007 Non-investment Grade) dated as of May
31, 2007 (the "Non-Investment Grade Securities Agreement"), among Wachovia
Investment Holdings, LLC, Wachovia Capital Markets LLC, NovaStar Mortgage, Inc.,
NovaStar Certificates Financing LLC, and NovaStar Certificates Financing Corp.
3. Master Repurchase Agreement (2007 Investment Grade) dated as of May 31,
2007 (the "Investment Grade Securities Agreement"), among Wachovia Bank,
National Association, Wachovia Capital Markets LLC, NovaStar Mortgage, Inc.,
NovaStar Certificates Financing LLC, and NovaStar Certificates Financing Corp.
4. Master Repurchase Agreement (New York) dated as of July 6, 2007 (the "NY
Agreement"), 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 February 4, 2008, 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: February 8, 2008 /s/ Rodney Schwatken
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Rodney Schwatken
Chief Financial Officer
Index to Exhibits
Exhibit No. Document
10.1 Master Repurchase Agreements Waiver, dated February 4, 2008, 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.