Novation Companies 8K Regulation FD Disclosure | NOVCQ 28 Feb 06

NovaStar Financial
(NYSE-NFI)
www.novastarmortgage.com

2005 Fourth Quarter Earnings

Conference Call

February 28, 2006

Safe Harbor Statement

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 and frequency 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 Quarterly Report on
Form 10-Q, for the period ending September 30, 2005. 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.