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NRZ Is Fortress (Fortress Is NOVC Via Ownership Of CDO Service Rights On 67% Of NOVC Sr Debt)


Observation on NOVC, NRZ and Fortress Investment Group (related to DX, IMH).

NRZ raises $433M 10.31.18 .

NOVC fails to disclose in SEC docs Call Rights on 21 of 26 MBS Bonds. This 3.2B portfolio represents value to NOVC Shareholders including 50M of residual interest (OC Bonds&piecesofcashflow)&CallRights.

NRZ is Fortress (Fortress is NOVC via ownership of CDO Service Rights on 67% of NOVC Sr Debt) call IR at NRZ and see who picks up the phone - it is Fortress; Wesley Edens COB (x head of Blackrock, Lehman MBS Desks) and Peter Briger (x Goldman Sachs Head of the lucrative Special Situation team). NRZ = Fortress which above raises almost half billion $433M at once.

Fortress controls and controlled in/out of Ch 11 Novation Companies, Inc. OTCBB/NOVC Sr Debt. Fortress is NOVC & has prior relationships (not disclosed with NOVC Board members including; all co-investors at DX via CMO which Fortress owned 100% when Board/investors members of NOVC took DX from pennies to over $7/share today 2000-2003, DX pays 82 cts annual dividend).

IMHO NOVC fails to provide adequate disclosure on $3.2B MBS Bond Portfolio of Call Rights which NRZ states has value see press release outlining Service Rights Transfer Agreement signed by NOVC CEO Oct 2007. NOVC is surrounded by experts just like NRZ Fortress yet NOVC representing to shareholder in SEC docs (since leaving Ch 11) they are lost and have little plans or ability to borrow. SEC disclosures mask another plans these investors have all in my opinion. Presently there is no SEC disclosure or value of Call Rights (ability to call collateral assets highly profitable nonprime mortgage loans that can be sold or more likely Resecuritized. Mr. Rich Lehman Partner in charge of NOVC CPA firm Boulay Group knows this. Fortress aka NRZ and NOVC common shareholder including Mass Mutual Barings owns 20% (read 7/16/07 8K documenting a 150M Equity Investment by Jefferies and Mass Mutual), DX Board present or ex members Barry Igdaloff 10% & Tom Akin/Talkot Capital owns 5% x DX material investor Howard Amster Board member at NOVC owns 5%, (Tom Akin/Talkot Capital largest shareholder in IMH, DX) Igdaloff pals Todd Emoff and Chuck Gillman (Whitney Tilson friend) and his co investors Jeff Eberwein/Lone Star Value Mgt (x Portfolio Mgr at G Soros shop) own at least 5%. These experts can value the call rights in 10 Minutes per one expert/x CEO of MREIT - so why has NOVC Board created SEC docs to look like they are in quasi going concern post emerging from Ch 11 7/17. Any investor that takes a bit of time will see these experts (present CEO David Pointer is 20 yrs close friends of Jeff Eberwein and Chuck Gillman).

These investors are all capped or prevented from buying more common shares (IRC Sec 382 caps common investors or groups at 5% per Poison Pill (that saves $700M NOL and $307M unrealized tax capital gains). Read the Rights Offering in revised Poison Pill see recent 14A page 13, voted on and approved at Oct 4th Annual Meeting. IMHO NOVC board has just devised a method for these investors to get around the poison pill. Page 13 of Rights Offering states investors (capped by Sec 382 of Poison Pill) can gain over 500M phantom common at $2.33. Read 14A NOVC Board 4of 5 members just picked up 833,333 RSU (see 14A 25k board pay divided by 3 cts pps = 833,333). Could there be a connection between poor SEC reports and a massive RSU award? These experts in MBS and NOL probably did not just spend $12m on Ch 11 to leave NOVC in this current state. 12m includes 6m to advisors like Joel Sher, Top Bankruptcy law firm Shapiro Sher (they received a black tie award for NOVC their press release states Joel Sher returned NOVC to sound financial footing, which is contradicted by SEC disclosures), 6.3M was paid Sr Debt (5.8M back interest compounded + undefined 500m penalty) of which Fortress picked up 70% (Fortress only paid $15.9M for $6B AUM on all Taberna CDOs. Taberna I & II own 67% of NOVC Sr Debt and thus Fortress controlled the NOVC Ch 11 Creditors Committee.

My guess we see in one 8K Fortress AND OR NRZ will pick up a huge piece of NOVC PS F phantom common (read recent 14A) and have control of NOVC and settle Sr Debt at discount. If so it was all quid pro quo with Barry Igdaloff & Sr Debt, NOVC Lead Board of Director per Sarbanes Oxley SOX. It all will happen with one 8K blessed by Mass Mutual Barings MM Barings (like KKR investment in WMIH and which weeks ago closed $3.8B purchase of NSM NationStar. NSM just like NOVC NovaStar Financial Inc. NFI made nonprime mortgage loans and resecuritized. Fortress per Press Release just cash in their entire 70% ownership in NSM for all Cash 100s of millions. Fortress weeks ago also sold to Apollo Global for all cash their entire 40% interest in OMF (AIG x subprime biz and x CitiBank One Main) for cool $2B yet NOVC Board per SEC docs make it look like Wesley Edens/Fortress worked with his pals on NOVC Board to waste NOVC Call Rights (per Servicing Rights Transfer Agreement signed Oct 2007 by NOVC CEO see press release) basically waste $700M NOL (hidden by GAAP) waste NSM look alike Brand NFI and waste the intellectual capital from these investors or is there a quid pro quo understanding shared with a very few. I will suggest this is material information must be reviewed by Boulay Group CPA outside NOVC audit firm and its disclosure carefully understood by Q3 expected in days. If you are shareholder in NOVC see Partner on NOVC Audit is Rich Lehman

Do your own due dilly and share. The above is based on facts and my reasonable opinion.

Disclosure: I am/we are long NOVC.