EX-99 2 ex99.htm EXHIBIT 99

NovaStar Announces Tax Treatment for 2006 Common Dividends

KANSAS CITY, Mo. – February 6, 2007 – NovaStar Financial, Inc. (NYSE:NFI), a residential lender and mortgage portfolio manager, today announced the tax treatment of its 2006 common dividend distributions. All common dividends, taxable for the year 2006, should be treated as “non-qualified” in nature. Common dividends taxable for the year 2006 follow:

 

Record Date

 

Payable Date

 

Total

Distribution

per Share

 

Taxable

Ordinary

Dividend

 

Return

of

Capital

 

 

 

 

 

 

 

 

 

5/15/2006

 

5/26/2006

 

$1.40

 

$1.40

 

$ -

8/14/2006

 

8/28/2006

 

1.40

 

1.40

 

-

11/20/2006

 

11/30/2006

 

1.40

 

1.40

 

-

12/19/2006

 

12/29/2006

 

1.40

 

1.40

 

-

 

 

 

 

$5.60

 

$5.60

 

$ -

 

Additional tax information and notification requirements regarding dividends received for certain shareholders is available at:

http://www.novastarmortgage.com/corporate/shareholder/dividend_information.aspx

 

About NovaStar

 

NovaStar Financial, Inc. (NYSE: NFI) is a specialty finance company that originates, purchases, invests in and services residential nonprime loans. The company specializes in single-family mortgages, involving borrowers whose loan size, credit details or other circumstances fall outside conventional mortgage agency guidelines. A Real Estate Investment Trust (REIT) founded in 1996, NovaStar efficiently brings together the capital markets, a nationwide network of mortgage brokers and American families financing their homes. NovaStar is headquartered in Kansas City, Missouri, and has lending operations nationwide.

 

Certain matters discussed in this release constitute forward-looking statements within the meaning of the federal securities laws. Forward-looking statements are those that predict or describe future events and that do not relate solely to historical matters. Forward-looking statements are subject to risks and uncertainties and certain factors can cause actual results to differ materially from those anticipated. Some important factors that could cause actual results to differ materially from those anticipated include: our ability to generate sufficient liquidity on favorable terms; the size, frequency and structure of our securitizations; interest rate fluctuations on our assets that differ from our liabilities; increases in prepayment or default rates on our mortgage assets; changes in assumptions

 

regarding estimated loan losses and fair value amounts; changes in origination and resale pricing of mortgage loans; our compliance with applicable local, state and federal laws and regulations or opinions of counsel relating thereto and the impact of new local, state or federal legislation or regulations or opinions of counsel relating thereto or court decisions on our operations; the initiation of margin calls under our credit facilities; the ability of our servicing operations to maintain high performance standards and maintain appropriate ratings from rating agencies; our ability to expand origination volume while maintaining an acceptable level of overhead; our ability to adapt to and implement technological changes; the stability of residual property values; the outcome of litigation or regulatory actions pending against us or other legal contingencies; the impact of losses resulting from natural disasters; the impact of general economic conditions; and the risks that are from time to time included in our filings with the SEC, including our Annual Report on Form 10-K, for the year ended December 31, 2005 and our quarterly report on form 10-Q, for the period ending September 30, 2006. Other factors not presently identified may also cause actual results to differ. This document speaks only as of its date and we expressly disclaim any duty to update the information herein.

CONTACT: NovaStar Financial, Inc.

Jeff Gentle, 816-237-7424