AMENDMENT NO. 4 TO THE SALE AND SERVICING AGREEMENT
Exhibit
4.2
AMENDMENT
NO. 4
TO
THE
Amendment
No. 4, dated as of November 1, 2007 (the “Amendment”),
to
the Sale and Servicing Agreement (the “Agreement”)
dated
as of April 1, 2006, by and among NovaStar Certificates Financing Corporation,
as depositor (the “Depositor”),
NovaStar Mortgage, Inc., as sponsor and servicer (the “Sponsor”
or
“Servicer”),
NovaStar Mortgage Funding Trust, Series 2006-1, as issuing entity (the
“Issuing
Entity”),
U.S.
Bank National Association, as custodian (the “Custodian”),
The
Bank of New York (as successor to JPMorgan Chase Bank, National Association),
as
indenture trustee (the “Indenture
Trustee”)
and
The Bank of New York (as successor to ▇.▇. ▇▇▇▇▇▇ Trust Company, National
Association), as co-trustee (the “Co-Trustee”).
Capitalized terms used and not defined herein shall have the meaning set
forth
in the Agreement and Appendix I thereto.
WHEREAS
the parties hereto have entered into the Agreement;
WHEREAS
the parties hereto now wish to amend certain provisions in the Agreement
pursuant to Section 11.03 of the Agreement; and
WHEREAS
the Indenture Trustee shall not consent to this Amendment to the Agreement
unless it shall have first received an Opinion of Counsel, to the effect
that
(a) this Amendment (i) will not prevent the Notes from being characterized
as
debt for United States federal income tax purposes or cause the Issuing Entity
to be subject to an entity-level tax for federal income tax purposes, and
(ii)
shall not adversely affect in any material respect the interests of any
Noteholder or the Hedge Counterparties, and (b) any applicable requirements
and
conditions set forth in the Agreement with respect to the adoption of amendments
thereto have been complied with.
NOW,
THEREFORE, in consideration of the promises and mutual agreements contained
herein, the parties hereto agree to amend the Agreement pursuant to Section
11.03 of the Agreement and restate certain provisions thereof as
follows:
1. Revised
Section 8.02(a).
In
Section 8.02(a) of the Agreement, the following sentence shall be added as
the
third to last sentence of such section:
“In
accordance with any successor Servicer not being liable for any acts or
omissions of any predecessor Servicer, the Servicing Defaults set forth in
subsections 8.01(a)(v), 8.01(a)(vi) and 8.01(a)(vii) shall apply to a successor
Servicer that succeeds to the servicing of the Mortgage Loans pursuant to
this
Agreement including, without limitation, Sections 3.28, 6.02, 6.04, 7.01
or 7.02
herein, only in the event of any withdrawal or downgrade by two or more levels
(i.e., from "Above Average" to "Below Average" or the equivalent) of such
successor Servicer’s rating as of the date of such succession, that results in a
downgrade, qualification or withdrawal of the rating assigned to any Class
of
Notes by any Rating Agency.”
2. Condition
to effectiveness.
As a
condition to the effectiveness of this Amendment, an Opinion of Counsel
satisfying the requirements of Section 11.03 of the Agreement has been received
by the parties hereto.
3. Effect
of Amendment.
This
Amendment to the Agreement shall be effective and the Agreement shall be
deemed
to be modified and amended in accordance herewith on the Payment Date on
the
date on which the Indenture Trustee receives an executed copy of this Amendment.
This Amendment, once effective, shall be effective as of the date first set
forth above. The respective rights, limitations, obligations, duties,
liabilities and immunities of the Depositor, the Sponsor, the Servicer, the
Issuing Entity, the Custodian, the Co-Trustee and the Indenture Trustee shall
hereafter be determined, exercised and enforced subject in all respects to
such
modifications and amendments, and all the terms and conditions of this Amendment
shall be and be deemed to be part of the terms and conditions of the Agreement
for any and all purposes. The Agreement, as amended hereby, is hereby ratified
and confirmed in all respects.
4. The
Agreement in Full Force and Effect as Amended.
Except
as specifically amended hereby, all the terms and conditions of the Agreement
shall remain in full force and effect and, except as expressly provided herein,
the effectiveness of this Amendment shall not operate as, or constitute a
waiver
or modification of, any right, power or remedy of any party to the Agreement.
All references to the Agreement in any other document or instrument shall
be
deemed to mean the Agreement as amended by this Amendment.
5. Counterparts.
This
Amendment may be executed by the parties in several counterparts, each of
which
shall be deemed to be an original and all of which shall constitute together
but
one and the same agreement. This Amendment shall become effective when
counterparts hereof executed on behalf of such party shall have been
received.
6. Governing
Law.
This
Amendment shall be construed in accordance with and governed by the laws
of the
State of New York applicable to agreements made and to be performed
therein.
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7. Limitation
of Owner Trustee Liability.
It is
expressly understood and agreed by the parties that (a) this document is
executed and delivered by Wilmington Trust Company, not individually or
personally, but solely as Owner Trustee, in the exercise of the powers and
authority conferred and vested in it, pursuant to the Trust Agreement, (b)
each
of the representations, undertakings and agreements herein made on the part
of
the Issuing Entity is made and intended not as personal representations,
undertakings and agreements by Wilmington Trust Company but is made and intended
for the purpose for binding only the Issuing Entity, (c) nothing herein
contained shall be construed as creating any liability on Wilmington Trust
Company, individually or personally, to perform any covenant either expressed
or
implied contained herein, all such liability, if any, being expressly waived
by
the parties hereto and by any person claiming by, through or under the parties
hereto, and (d) under no circumstances shall Wilmington Trust Company be
personally liable for the payment of any indebtedness or expenses of the
Issuing
Entity or be liable for the breach or failure of any obligation, representation,
warranty or covenant made or undertaken by the Issuing Entity under this
Amendment or any other related documents.
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IN
WITNESS WHEREOF, the Depositor, Sponsor, the Servicer, the Issuing Entity,
the
Indenture Trustee, the Co-Trustee and the Custodian, have caused this Amendment
to be duly executed by their officers thereunto duly authorized, all as of
the
day and year first above written.
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NOVASTAR
CERTIFICATES FINANCING CORPORATION, as Depositor
By: /s/
▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇
Name: ▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇▇
Title: Vice
President
NOVASTAR
MORTGAGE, INC.,
as
Sponsor and as Servicer
By: /s/
▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇
Name: ▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇▇
Title: Vice
President
NOVASTAR
MORTGAGE FUNDING TRUST, SERIES 2006-1, as Issuing Entity
By: WILMINGTON
TRUST COMPANY, not in its individual capacity, but solely as Owner
Trustee
under the Trust Agreement
By: /s/
▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Name:
▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: Vice
President
U.S.
BANK NATIONAL ASSOCIATION, as Custodian
By: /s/
▇▇▇▇▇▇▇ Rhode
Name:
▇▇▇▇▇▇▇ Rhode
Title:
Assistant Vice President
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[Signature
Page for Amendment No. 4 to the Sale and Servicing Agreement -
Section
8.02]
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▇
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▇▇▇
▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇,
not in its individual capacity but solely as Indenture
Trustee
By: /s/
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Name:
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title:
Assistant Vice President
THE
BANK OF NEW YORK,
not in its individual capacity but solely as Co-Trustee
By: /s/
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Name:
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title:
Assistant Vice President
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DB
STRUCTURED PRODUCTS, INC.
hereby
consents to the foregoing Amendment as lender under certain financing
facilities:
By:___/s/
▇▇▇▇▇ ▇▇▇▇▇▇▇
________________
Name:
▇▇▇▇▇ ▇▇▇▇▇▇▇
Title:
Director
WACHOVIA
BANK, N.A.
hereby
consents to the foregoing Amendment as lender under certain financing
facilities:
By:___/s/
▇▇▇▇▇▇ ▇. ▇▇▇▇▇ ______________
Name:
▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Title:
Director
WACHOVIA
CAPITAL MARKETS, LLC
hereby
consents to the foregoing Amendment as lender under certain financing
facilities:
By:___/s/
▇▇▇▇▇ ▇▇▇▇▇▇ _________________
Name:
▇▇▇▇▇ ▇▇▇▇▇▇
Title:
Vice President
WACHOVIA
INVESTMENT HOLDINGS, LLC
hereby
consents to the foregoing Amendment as lender under
certain
financing facilities:
By:__/s/
▇▇▇▇▇ ▇▇▇▇▇▇ _________________
Name:
▇▇▇▇▇ ▇▇▇▇▇▇
Title:
Vice President
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[Signature
Page for Amendment No. 4 to the Sale and Servicing Agreement - Section
8.02]
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