Exhibit 4.2
FIRST AMENDMENT
TO
POOLING AND SERVICING AGREEMENT
NovaStar Series 2001-2
THIS FIRST AMENDMENT TO POOLING AND SERVICING AGREEMENT (this "First
Amendment"), dated as of October 25, 2001, is made by and among NOVASTAR
MORTGAGE FUNDING CORPORATION, as the company (the "Company"), NOVASTAR MORTGAGE,
INC., as the servicer (the "Servicer") and as the seller (the "Seller"), FIRST
UNION NATIONAL BANK, as the certificate administrator (the "Certificate
Administrator") and CITIBANK, N.A., as the trustee (the "Trustee").
WITNESSETH
WHEREAS, the parties hereto are parties to the Pooling and Servicing
Agreement, dated as of September 1, 2001 (the "Original Agreement");
WHEREAS, the parties hereto now desire to enter into this First
Amendment to amend the Original Agreement (the Original Agreement, as amended by
this First Amendment, is referred to herein as the "Agreement");
WHEREAS, the parties hereto wish to amend the Original Agreement to
correct and supplement a provision of the Original Agreement and require the
Trustee and the Certificate Administrator to promptly distribute income and
gains realized from investment of funds held in the Pre-Funding Account to the
Certificateholders, rather than accumulating such income and gains in the
Interest Coverage Account; and
WHEREAS, pursuant to Section 12.01 of the Original Agreement, this
First Amendment to the Original Agreement may be made if it (i) does not
adversely affect in any respect the interests of any Certificateholder, (ii)
would not result in the imposition of a tax on any REMIC or cause any REMIC to
fail to qualify as a REMIC, and (iii) is adopted in accordance with the terms of
the Original Agreement;
AGREEMENT
NOW, THEREFORE, in consideration of the foregoing and of the covenants
and agreements hereinafter set forth, the parties hereto agree as follows:
1. Definitions. All capitalized terms used herein and not otherwise
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defined herein shall have the meaning given to each such term in the Original
Agreement.
2. Amendment of Section 4.06. Section 4.06(c) of the Original Agreement
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is hereby amended by deleting "(i)" therein and inserting in place thereof
"(A)", deleting "(ii)" therein and inserting in place thereof "(B)", and
inserting in the fifth line thereof after the words "equal to" the following:
the greater of (i) the income and gain realized from investments in the
Pre-Funding Account and deposited in the Interest Coverage Account
since the prior Distribution Date or (ii)
The complete amended paragraph (c) of Section 4.06 is attached hereto as
Appendix A.
3. Representations and Warranties. The Company, the Seller and the
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Servicer represent and warrant to the Trustee, for the benefit of the
Certificateholders, and to the Certificate Administrator that this First
Amendment:
(a) does not adversely affect in any respect the interests of
any Certificateholder;
(b) will not result in the imposition of a tax on any REMIC or
cause any REMIC to fail to qualify as a REMIC; and
(c) has been adopted in accordance with the terms of Section
12.01 of the Original Agreement.
4. Delivery of Opinion. The Company, the Seller and the Servicer will
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deliver to the Trustee, for the benefit of the Certificateholders, and to the
Certificate Administrator, an opinion of counsel as contemplated by Section
12.01 of the Original Agreement (the "Opinion of Counsel").
5. Governing Law. THIS FIRST AMENDMENT SHALL BE CONSTRUED IN ACCORDANCE
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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 SUCH LAWS.
6. Counterparts. This First Amendment may be executed in any number of
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counterparts, each of which when so executed shall be deemed an original all of
which taken together shall constitute one agreement. Any party hereto may
execute this First Amendment by signing any such counterpart.
7. Ratification and Confirmation. Except as specifically amended above,
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all of the terms and conditions and covenants of the Original Agreement (as
amended by the First Amendment) are hereby ratified and confirmed and shall
remain unaltered and in full force and effect and shall be binding upon the
parties hereto and thereto in all respects. The Original Agreement and this
First Amendment shall be read, taken and combined as one and the same
instrument.
8. Effective Time. This First Amendment shall become effective on the
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date set forth above.
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IN WITNESS WHEREOF, the Company, the Servicer, the Seller, the
Certificate Administrator and the Trustee have caused their names to be signed
hereto by their respective officers thereunto duly authorized, all as of the day
and year first above written.
NOVASTAR MORTGAGE FUNDING CORPORATION,
as Company
By: /s/ Xxxxx Xxxxxxxx
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Name: Xxxxx Xxxxxxxx
Title: Vice President
NOVASTAR MORTGAGE, INC.,
as Servicer and as Seller
By: /s/ Xxxxx Xxxxxxxx
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Name: Xxxxx Xxxxxxxx
Title: Vice President
FIRST UNION NATIONAL BANK,
as Certificate Administrator
By: /s/ Xxxxxx Xxxxxxxx
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Name: Xxxxxx Xxxxxxxx
Title: Vice President
CITIBANK, N.A.,
as Trustee
By: /s/ Xxxxxxx Xxxxxxxx
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Name: Xxxxxxx Xxxxxxxx
Title: Assistant Vice President
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APPENDIX A
Section 4.06(c) as amended
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(c) On each Distribution Date during the Funding Period and on the
Distribution Date immediately following the end of the Funding Period, the
Certificate Administrator shall withdraw from the Interest Coverage Account, to
the extent funds are available therefore, and deposit in the Payment Account an
amount, as provided in the related Determination Date Report, equal to the
greater of (i) the income and gain realized from investments in the Pre-Funding
Account and deposited in the Interest Coverage Account since the prior
Distribution Date or (ii) the difference between (A) the sum of the REMIC
Monthly Interest Distributable Amounts for each of the Class A Certificates and
the Mezzanine Certificates for such Distribution Date, and (B) the Interest
Remittance Amount for such Distributable Date (excluding the amount of interest
included pursuant to clause (vi) of the definition of REMIC Available Funds),
but not less than zero. Such withdrawal and deposit shall be treated as a
contribution of cash by the Company to REMIC 1 on the date thereof.
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