EXECUTION COPY
December 7, 2007
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
0000 Xxxx Xxxxxxx,
Xxxxx 000
Xxxxxx Xxxx, Xxxxxxxx 00000
Re: Master Repurchase Agreements Waiver
Reference is made to those certain Master Repurchase Agreements listed on
Schedule I attached hereto (the "Agreements"). Capitalized terms used in this
letter agreement without definition have the meanings ascribed to them in the
Agreements.
Effective as of the date hereof and until January 4, 2008 (the "Waiver
Period") and subject to the limitations set forth herein, each Buyer hereby:
A. 1. Agrees not to enforce the requirements for NovaStar
Financial, Inc. ("NFI") to maintain a required Adjusted
Tangible Net Worth under the Agreements;
2. Waives any breach and/or any event of default that would
otherwise arise under the Agreements solely as a result of
the failure of NFI to have the required Adjusted Tangible
Net Worth specified in the Agreements; or
3. Agrees that in the Monthly Certificates delivered by NFI,
NFI may carve-out the certification solely relating to the
Adjusted Tangible Net Worth for the previous month and each
Buyer hereby waives any breach and/or event of default that
would otherwise arise under the Agreements as a result of
such carve-out from the Monthly Certifications.
B. 1. Agrees, during the Waiver Period, not to enforce the
requirements for NovaStar Financial, Inc. ("NFI") to
maintain Liquidity in an amount not less than $30,000,000 as
specified under the
Wachovia NovaStar TNW Waiver 12-07-07
Agreements; provided that NFI agrees to maintain Liquidity
that could be drawn against (taking into account required
haircuts) in an amount not less than $24,000,000;
2. Waives any breach and/or any event of default that would
otherwise arise under the Agreements solely as a result of
the failure of NFI to maintain Liquidity in an amount not
less than $30,000,000 during the Waiver Period; provided
that NFI maintains Liquidity in an amount not less than the
$24,000,000 during the Waiver Period;
3. Agrees that in the Monthly Certificates delivered by NFI
during the Waiver Period, NFI may carve-out the
certification solely relating to the maintenance of
Liquidity in an amount not less than $30,000,000 for the
previous month and each Buyer hereby waives any breach
and/or event of default that would otherwise arise under the
Agreements as a result of such carve-out from the Monthly
Certifications; provided that NFI maintains Liquidity in an
amount not less than $24,000,000 for such month and
certifies that it has maintained such amount in the Monthly
Certification.
Notwithstanding anything to the contrary herein, all parties bound herein
acknowledge and agree that the Buyers, shall retain all rights and remedies in
order to enforce any Event of Default or other breach contemplated by the
Agreements.
Notwithstanding the occurrence and continuance of the NFI's failure to
maintain the required Adjusted Tangible Net Worth or maintenance of Liquidity
under the Agreements described above, each Buyer is willing to waive certain of
its rights; provided that each Buyer reserves the right to unilaterally
terminate this letter agreement on or prior to January 4, 2008, without notice
to any party, based upon the occurrence of any Event of Default or breach that
occurs under the Agreements on or after the date hereof other than the Event of
Default expressly waived by the Buyers herein. Either Buyer's exercise of the
right to terminate this letter agreement shall be effective as to both Buyers.
Each Buyer hereby expressly reserves all other rights and remedies
available to it under the Agreements, and all rights, remedies, obligations, and
liabilities created or evinced thereby with respect to future breaches of, or
Defaults or Events of Default under, the Agreements. Except as stated herein,
the Buyers shall not be deemed to have waived or modified any of its rights
hereunder or under any other agreement, instrument or paper signed by NovaStar
Mortgage, Inc., NovaStar Certificates Financing LLC, NovaStar Certificates
Financing Corporation, NFI Repurchase Corporation, NMI Repurchase Corporation,
NMI Property Financing, Inc., HomeView Lending, Inc., NFI and NFI Holding
Corporation (collectively, the "NovaStar Parties") unless such waiver or
modification is in writing and signed by the Buyers. Except as expressly
provided herein, no failure or delay on the part of the Buyers in exercising any
right, power or remedy hereunder or any of the Agreements shall operate as a
waiver thereof; nor shall any single
Wachovia NovaStar TNW Waiver 12-07-07
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or partial exercise of any such right, power or remedy preclude any other or
further exercise thereof or the exercise of any other right, power or remedy
hereunder. This letter agreement shall be construed in accordance with the laws
of the State of New York, and the obligations, rights and remedies of the
parties hereunder shall be determined in accordance with the laws of the State
of New York except to the extent preempted by federal law. Any provision hereof
which is prohibited or unenforceable in any jurisdiction shall, as to such
jurisdiction, be ineffective to the extent of such prohibition or
unenforceability without invalidating the remaining provisions hereof or thereof
or affecting the validity or enforceability of such provision in any other
jurisdiction.
This letter agreement may be executed in any number of counterparts, each
of which (including any copy hereof delivered by facsimile) shall constitute one
and the same original instrument, and either party hereto may execute this
letter agreement by signing any such counterpart.
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Wachovia NovaStar TNW Waiver 12-07-07
3
EXECUTION COPY
Very truly yours,
Wachovia Bank, N.A.,
as Buyer
By: /s/ Xxxxx Xxxxxx
-------------------------------
Name: Xxxxx Xxxxxx
Title: Vice President
Wachovia Investment Holdings, LLC,
as Buyer
By: /s/ Xxxxxx X. Xxxxx
-------------------------------
Name: Xxxxxx X. Xxxxx
Title: Director
Acknowledged and Agreed:
NovaStar Mortgage, Inc., as Seller and Guarantor
By: /s/ Xxxxxxx X. Xxxx
---------------------------------
Name: Xxxxxxx X. Xxxx
Title: CFO
NovaStar Certificates Financing LLC, as Seller
By: /s/ Xxxxxxx X. Xxxx
---------------------------------
Name: Xxxxxxx X. Xxxx
Title: Senior Vice President
Wachovia NovaStar TNW Waiver 12-07-07
NovaStar Certificates Financing Corporation, as Seller
By: /s/ Xxxxxxx X. Xxxx
---------------------------------
Name: Xxxxxxx X. Xxxx
Title: Senior Vice President
NFI Repurchase Corporation, as Seller
By: /s/ Xxxxxxx X. Xxxx
---------------------------------
Name: Xxxxxxx X. Xxxx
Title: Senior Vice President
NMI Repurchase Corporation, as Seller
By: /s/ Xxxxxxx X. Xxxx
---------------------------------
Name: Xxxxxxx X. Xxxx
Title: Senior Vice President
NMI Property Financing, Inc., as Seller
By: /s/ Xxxxxxx X. Xxxx
---------------------------------
Name: Xxxxxxx X. Xxxx
Title:
HomeView Lending, Inc., as Seller and Guarantor
By: /s/ Xxxxxxx X. Xxxx
---------------------------------
Name: Xxxxxxx X. Xxxx
Title: CFO
NovaStar Financial, Inc., as Seller and Guarantor
By: /s/ Xxxxxxx X. Xxxx
---------------------------------
Name: Xxxxxxx X. Xxxx
Wachovia NovaStar TNW Waiver 12-07-07
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Title: CFO
NFI Holding Corporation, as Seller and Guarantor
By: /s/ Xxxxxxx X. Xxxx
---------------------------------
Name: Xxxxxxx X. Xxxx
Title: Senior Vice President
Wachovia NovaStar TNW Waiver 12-07-07
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SCHEDULE I
1. Master Repurchase Agreement (2007 Residual Securities) dated as of April 18,
2007 (the "Residual Securities Agreement"), 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 (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.
3. 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.
4. 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.
5. Master Repurchase Agreement (New York) dated as of July 6, 2007 (the "NY
Agreement") between Wachovia Bank, National Association and NovaStar Mortgage,
Inc.
Wachovia NovaStar TNW Waiver 12-07-07
