Document:

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                          NONRECOURSE PROMISSORY NOTE

$691,778.00                                                      January 1, 2001

     FOR VALUE RECEIVED, the undersigned, Scott F. Hartman, promises to pay to
the order of NovaStar Financial, Inc., a Maryland corporation (the "Company"),
the principal amount of Six Hundred Ninety-one Thousand, Seven Hundred Seventy-
eight and 00/100 Dollars ($691,778.00) without interest.

     This Note is secured by Seventy-two Thousand Two Hundred Twenty-two
(72,222) shares of common stock of NovaStar Financial, Inc. owned by the
undersigned.

     Without impairing or otherwise limiting the Company's rights and remedies
with respect to the collateral given for this Note, the undersigned shall not be
liable personally for the repayment of the indebtedness evidenced by the Note,
and the Company waives its right to enforce against the undersigned a judgment
posing liability for any deficiency in payment of the indebtedness evidenced by
this Note.

     Principal shall be payable in ten (10) equal installments of Sixty-nine
Thousand, One Hundred Seventy Seven and 80/100 Dollars ($69,177.80) beginning
December 31, 2001.

     Payment of principal then due will be forgiven by the Company if the
undersigned remains in the employ of the Company on the due date.

     If prior to maturity there is a "Change of Control" in the Company or if
the undersigned's employment is terminated by the Company other than for "Cause"
or by the undersigned for "Good Reason," as those terms are defined in the
undersigned's Employment Agreement with the Company, all remaining unpaid
principal and interest due under the Note shall be forgiven.

     In addition, a bonus will be paid by the Company to the undersigned in the
amount of personal tax liability resulting from the forgiveness of debt that is
in excess of the after-tax dividends from the common stock securing this note.
The after tax dividends are calculated as the dividends paid on the common stock
securing this note, reduced by the amount of the personal tax liability
resulting from the dividends.  If the after-tax dividends from the common stock
securing this note are greater than or equal to the personal tax liability, no
bonus relating to this note will be paid.

     Principal shall be payable in full at maturity, which maturity date is the
earlier of (i) the sale of the underlying securities, (ii) the termination of
the undersigned's employment with the Company or (iii) December 31, 2010.

     This Note may be prepaid in full or in part at any time.

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     If default be made in the payment of principal when due, then the whole sum
of principal shall become immediately due and payable at the option of the
holder of this Note, without notice or demand.

     Promisor shall pay all costs and expenses, including reasonable attorneys'
fees, incurred by the holder hereof in the collection of this Note.

     /s/ Scott F. Hartman
-----------------------------------
Scott F. Hartman

NovaStar Financial hereby consents to
the waiver of remedies and the limitation
of rights contained in this Note.

By:  /s/ Rodney E. Schwatken
     ------------------------------
Vice President and Treasurer

                                       2<PAGE>

                          NONRECOURSE PROMISSORY NOTE

$701,431.00                                                      January 1, 2001

     FOR VALUE RECEIVED, the undersigned, W. Lance Anderson, promises to pay to
the order of NovaStar Financial, Inc., a Maryland corporation (the "Company"),
the principal amount of Seven Hundred One Thousand, Four Hundred Thirty-one and
00/100 Dollars ($701,431.00) without interest.

     This Note is secured by Seventy-two Thousand Two Hundred Twenty-two
(72,222) shares of common stock of NovaStar Financial, Inc. owned by the
undersigned.

     Without impairing or otherwise limiting the Company's rights and remedies
with respect to the collateral given for this Note, the undersigned shall not be
liable personally for the repayment of the indebtedness evidenced by the Note,
and the Company waives its right to enforce against the undersigned a judgment
posing liability for any deficiency in payment of the indebtedness evidenced by
this Note.

     Principal shall be payable in ten (10) equal installments of Seventy
Thousand, One Hundred Forty-three and 10/100 Dollars ($70,143.10) beginning
December 31, 2001.

     Payment of principal then due will be forgiven by the Company if the
undersigned remains in the employ of the Company on the due date.

     If prior to maturity there is a "Change of Control" in the Company or if
the undersigned's employment is terminated by the Company other than for "Cause"
or by the undersigned for "Good Reason," as those terms are defined in the
undersigned's Employment Agreement with the Company, all remaining unpaid
principal and interest due under the Note shall be forgiven.

     In addition, a bonus will be paid by the Company to the undersigned in the
amount of personal tax liability resulting from the forgiveness of debt that is
in excess of the after-tax dividends from the common stock securing this note.
The after tax dividends are calculated as the dividends paid on the common stock
securing this note, reduced by the amount of the personal tax liability
resulting from the dividends.  If the after-tax dividends from the common stock
securing this note are greater than or equal to the personal tax liability, no
bonus relating to this note will be paid.

     Principal shall be payable in full at maturity, which maturity date is the
earlier of (i) the sale of the underlying securities, (ii) the termination of
the undersigned's employment with the Company or (iii) December 31, 2010.

     This Note may be prepaid in full or in part at any time.

                                       1
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     If default be made in the payment of principal when due, then the whole sum
of principal shall become immediately due and payable at the option of the
holder of this Note, without notice or demand.

     Promisor shall pay all costs and expenses, including reasonable attorneys'
fees, incurred by the holder hereof in the collection of this Note.

/s/ W. Lance Anderson
-----------------------------------
W. Lance Anderson

NovaStar Financial hereby consents to
the waiver of remedies and the limitation
of rights contained in this Note.

By: /s/ Rodney E. Schwatken
    -------------------------------
Vice President and Treasurer

                                       2<PAGE>

  Exhibit 10(i) - Amendment dated March 27, 2001 to the Mid America Bank, fsb
              Supplemental Executive Retirement Plan, as amended.
<PAGE>

                           CERTIFICATE OF RESOLUTION

I, Carolyn Pihera, do hereby certify that I am the duly elected and acting
Secretary of Mid America Bank, fsb, and the following is a true and correct copy
of certain resolutions adopted by the Board of Directors of said Bank at their
regular meeting held on March 27, 2001, at which meeting a quorum of the members
of said Board were present and acting throughout:

WHEREAS, the Mid America Federal Savings Bank Supplemental Executive Retirement
Plan (the "Plan") provides that a year of Plan Service shall not be credited to
a Participant for any calendar year following the year in which the Participant
attains the age of 65; and

WHEREAS, the Board desires to amend the Plan effective January 1, 2001, to
provide that Participants may receive credit for Plan Service up to and
including the year in which a participant reaches age 68;

WHEREAS, the Board further desires to amend the Plan effective January 1, 2001,
to clarify that a participant will not receive credit for a year of plan service
for periods ending prior to the effective time in which he or she is named a
participant in the Plan;

NOW THEREFORE BE IT HEREBY RESOLVED, that pursuant to Section 7.1 of the Plan,
Section 2.14 of the Plan is hereby amended and restated to read as follows:

     2.14  "Plan Service" means the number of full calendar years of
           participation in the Plan. A year of Plan Service shall be credited
           to a Participant as of each December 31/st/. The maximum number of
           years of Plan Service shall not exceed 20 years and a year of Plan
           Service shall not be credited to a Participant for any calendar year
           following the year in which the Participant attains the age of 68.

FURTHER RESOLVED, that the first sentence of Section 4.9 of the Plan is hereby
amended to read as follows:

     In the event of a Change in Control, a Participant (other than any
     Participant who is formerly an officer or director of Westco Bancorp, Inc.)
     shall be credited with an additional ten (10) years of Plan Service,
     however, in no event shall the Participant's total years of Plan Service
     exceed the lesser of 20 years or the Participant's projected years of Plan
     Service at age 68.

FURTHER RESOLVED, that in connection with the Bank's prior name change, all
references in the SERP to Mid America Federal Savings Bank, including in the
name of the plan, shall be changed to Mid America Bank, fsb.

                                       2
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I do further certify that the foregoing resolution has not been altered or
amended, but remains in force and effect.

IN WITNESS WHEREOF, I have executed this Certificate and affixed the Bank's seal
this 2/nd/ day of April, 2001.

/s/ Carolyn Pihera
------------------
Corporate Secretary

                                       3<PAGE>

Exhibit 10(ii) - Amendment dated March 27, 2001 to the MAF Bancorp, Inc. Stock
                          Option Gain Deferral Plan.
<PAGE>

                           CERTIFICATE OF RESOLUTION

I, Carolyn Pihera, do hereby certify that I am the duly elected and acting
Secretary of MAF Bancorp, Inc., and the following is a true and correct copy of
a certain resolution adopted by the Board of Directors of said Corporation at
their regular meeting held on March 27, 2001, at which meeting a quorum of the
members of said Board were present and acting throughout:

WHEREAS, the definition of "Overall Tax Rate" contained in the MAF Bancorp Gain
Deferral Plan (the "Gain Deferral Plan") does not contemplate any decline in tax
rates and the Board desires to amend this definition to provide for the
possibility of a change in tax rates;

NOW THEREFORE BE IT HEREBY RESOLVED, that pursuant to Section 9.1 of the Gain
Deferral Plan, the definition of "Overall Tax Rate" contained in Section 2.1 is
hereby amended to read as follows:

     "Overall Tax Rate" means the lesser of: (a) 42.6%, or (b) the sum of the
     highest federal income tax rate, highest state of Illinois personal income
     tax rate and highest Medicare tax rate, then in effect.

I do further certify that the foregoing resolution has not been altered or
amended, but remains in force and effect.

IN WITNESS WHEREOF, I have executed this Certificate and affixed the
Corporation's seal this 2/nd/ day of April, 2001.

/s/ Carolyn Pihera
------------------
Corporate Secretary

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