Exhibit 10.27
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MORTGAGE LOAN SALE AND SECURITIZATION
TRANSACTION, ADMINISTRATIVE PERSONNEL
AND FACILITIES AGREEMENT
_________________________
Dated as of July 1, 2000
_________________________
NOVASTAR FINANCIAL, INC.
and
NFI HOLDING CORPORATION
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TABLE OF CONTENTS
Page
Section 1. Transaction Fee............................................ 1
Section 2. Administrative Personnel and Facilities.................... 1
Section 3. Limits of Company Responsibility........................... 2
Section 4. Terms; Termination......................................... 2
Section 5. Action Upon Termination.................................... 2
Section 6. Assignment................................................. 2
Section 7. Notices.................................................... 2
Section 8. No Joint Venture........................................... 3
Section 9. Amendments................................................. 3
Section 10. Severability............................................... 3
Section 11. Entire Agreement........................................... 3
Section 12. Waiver..................................................... 3
Section 13. Governing Law.............................................. 3
Section 14. Headings and Cross References.............................. 3
Section 15. Execution in Counterparts.................................. 3
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MORTGAGE LOAN SALE AND SECURTIZATION
TRANSACTION, ADMINISTRATIVE PERSONNEL
AND FACILITIES AGREEMENT
THIS AGREEMENT, made effective as of the 1st day of July, 2000 (the
"Effective Date"), is by and between NovaStar Financial, Inc., Inc., a Maryland
corporation ("REIT"), and NFI Holding Corporation, a Delaware corporation ("NFI
Holding"). References to REIT or NFI Holding herein shall include any wholly-
owned subsidiaries of REIT or NFI Holding from time to time, unless the context
otherwise requires.
BACKGROUND
A. REIT owns all of the preferred stock of NFI Holding;
B. NFI Holding desires that REIT share with NFI Holding, and REIT desires
that NFI Holding share with REIT, certain administrative personnel and
facilities in connection with the sale and securitization of mortgage loans.
NOW, THEREFORE, in consideration of the mutual agreements herein set forth,
the parties hereto agree as follows:
1. Transaction Fee
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(a) NFI Holding agrees to pay REIT a transaction fee of 0.25% of the
aggregate unpaid balance of the mortgage loans subject to sale or securitization
on the closing date of the sale or securitization.
2. Administrative Personnel and Facilities.
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(a) REIT and NFI Holding agree to share office space and equipment
(including computer equipment), and the services of administrative and other
personnel, and items ancillary to the foregoing, as each may require for
mortgage loan securitizations and for third-party whole loan sale transactions.
REIT and NFI Holding shall monitor the on-going use of facilities and personnel
by REIT and NFI Holding, respectively, and within 15 days after the end of each
fiscal quarter shall agree upon a written allocation (by time used or other
appropriate measure) of facilities used by each and a list of personnel used by
each setting forth a percentage allocation of time devoted by each person to
each party.
(b) REIT and NFI Holding shall pay to each of their respective share
(as determined by their mutual agreement) of the following expenses that relate
to the provision of any personnel or facilities pursuant to this Section 1:
(i) rent (including related local property taxes and property
insurance costs), telephone, utilities, office furniture, equipment and
machinery (including computers, to the extent utilized) and other office
expenses not specifically allocated to the activities of REIT or NFI Holding;
and
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(ii) personnel expense (including salary, bonuses, benefits and
taxes); and
(iii) other general overhead expenses related to the foregoing.
Each party shall be responsible for all third-party fees and expenses
billed separately to it, such as accounting and legal fees and expenses.
3. Limits of Company Responsibility. Neither party assumes responsibility
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under this Agreement other than to share the facilities and personnel called for
hereunder in good faith and neither party shall be responsible for any of its
actions hereunder, including those of its shareholders, directors, officers and
employees acting in accordance with this Agreement, except by reason of acts
constituting bad faith, willful misconduct, gross negligence or reckless
disregard of their duties. Each party shall reimburse, indemnify and hold
harmless the other party, its shareholders, directors, officers and employees of
and from any and all expenses, losses, damages, liabilities, demands, charges
and claims of any nature whatsoever in respect of or arising from any acts or
omissions of such party, its shareholders, directors, officers and employees
constituting bad faith, willful misconduct, gross negligence or reckless
disregard of their duties.
4. Terms; Termination. This Agreement shall remain in force until the
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second anniversary of the Effective Date, and thereafter, it shall be
automatically renewed for a term of one (1) year unless a written notice is
delivered by either party within 30 days prior to the end of the term or any
renewal term of this Agreement.
5. Action Upon Termination. From and after the effective date of
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termination of this Agreement, each party shall forthwith:
(a) Agree with the other party on written allocations of facilities
and personnel covering the period following the date of the last quarterly
allocation agreed upon to the date of termination; and
(b) Based on such allocations, pay over to the other party any money
due for the account of such party pursuant to this Agreement or otherwise.
6. Assignment. This Agreement shall not be assignable by either party
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without the consent of the other party, except in the case of an assignment by
either party to a corporation or other organization which is a successor (by
merger, consolidation or purchase of assets) to such party, in which case such
successor organization shall be bound hereunder by the terms of said assignment
in the same manner as the party succeeded is bound hereunder.
7. Notices. Any notice, report or other communication required or
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permitted to be given hereunder shall be in writing, unless some other method of
giving such notice, report or other communication is accepted by the party to
whom it is given, and shall be given by being delivered at the following
addresses of the parties hereto:
REIT: NovaStar Financial, Inc.
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▇▇▇▇ ▇. ▇▇/▇▇/ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
NFI Holding: NFI Holding Company
▇▇▇▇ ▇. ▇▇/▇▇/ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Either party may at any time give notice in writing to the other party of a
change of its address for the purpose of this Section 10.
8. No Joint Venture. REIT and NFI Holding are not partners or joint
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venturers with each other and nothing herein shall be construed to make them
such partners or joint venturers or impose any liability as such on either of
them.
9. Amendments. This Agreement shall not be amended, changed, modified,
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terminated or discharged in whole or in part, and the performance of any
obligation hereunder may not be waived, except by an instrument in writing
signed by both parties hereto, or their respective successors or permitted
assigns, or otherwise as provided herein.
10. Severability. The invalidity or unenforceability of any provision of
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this Agreement shall not affect the validity of any other provision, and all
other provisions shall remain in full force and effect.
11. Entire Agreement. This instrument contains the entire agreement
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between the parties as to the rights granted and the obligations assumed in this
instrument.
12. Waiver. Any forbearance by a party to this Agreement in exercising
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any right or remedy under this Agreement or otherwise afforded by applicable
laws shall not be a waiver of or preclude the exercise of that or any other
right or remedy.
13. Governing Law. This Agreement shall be governed by, construed under
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and interpreted in accordance with the laws of the State of Kansas.
14. Headings and Cross References. The section headings hereof have been
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inserted for convenience of reference only and shall not be construed to affect
the meaning, construction or effect of this Agreement. Any reference made in
this Agreement to a "Section" or "Subsection" shall be construed, respectively,
as referring to a section of this Agreement or a subsection of a section of this
Agreement.
15. Execution in Counterparts. This Agreement may be executed in one or
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more counterparts, any of which shall constitute an original as against any
party whose signature appears on it, and all of which shall together constitute
a single instrument. This Agreement shall become binding when one or more
counterparts individually or taken together, bear the signatures of both
parties.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their officers as of the day and year first above written.
NOVATAR FINANCIAL, INC.
By: _____________________________
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Chief Executive Officer
NFI HOLDING CORPORATION
By: _____________________________
Name: W. ▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Title: President
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