Hovnanian Enterprises, Inc. (NYSE:HOV) (the “Company”) announced
today that its wholly-owned subsidiary, K. Hovnanian Enterprises,
Inc. (the “Issuer”), has amended certain terms of its previously
announced private offer to exchange (the “Exchange Offer”) any and
all of the Issuer’s $440.0 million outstanding 10.000% Senior
Secured Notes due 2022 (the “Existing 2022 Notes”) and $400.0
million outstanding 10.500% Senior Secured Notes due 2024 (the
“Existing 2024 Notes,” and together with the Existing 2022 Notes,
the “Existing Notes”) for the Issuer’s newly issued 3.0% Senior
Notes due 2047 (the “New Notes”) and concurrent solicitation of
consents with respect to the Existing 2022 Notes (the “Existing
2022 Notes Consent Solicitation”).
The amendments extend each of (i) the deadline for tendering
Existing Notes (and, if applicable, delivering consents) in order
to receive the exchange consideration of $1,400 principal amount of
New Notes for each $1,000 principal amount of Existing Notes
validly tendered and accepted in the Exchange Offer on the Early
Settlement Date (defined below) (such time and date, as the same
may be extended, the “Early Tender Deadline”) and (ii) the deadline
for withdrawing tendered Existing Notes and (if applicable,
revoking consents) (such time and date, as the same may be
extended, the “Withdrawal Deadline”) to 5:00 p.m., New York City
time, on May 11, 2018, unless extended. Existing Notes tendered may
be withdrawn at any time prior to the Withdrawal Deadline, but not
thereafter, unless required by applicable law. Assuming that the
conditions to the Exchange Offer are satisfied or waived, the
Issuer intends for the “Early Settlement Date” to occur promptly
after the Early Tender Deadline. It is anticipated that the Early
Settlement Date will be the second business day after the Early
Tender Deadline, unless otherwise designated by the
Issuer.
The Issuer also announced that it has extended the expiration
time for the Exchange Offer and Existing 2022 Notes Consent
Solicitation to 8:00 a.m., New York City time, on June 15, 2018,
unless extended by the Issuer (such date and time, as the same may
be extended, the “Expiration Time”). Assuming that the conditions
to the Exchange Offer are satisfied or waived (including the
minimum exchange condition requiring that at least $50.0 million in
aggregate principal amount of the Existing Notes shall have been
validly tendered (and not validly withdrawn prior to the Withdrawal
Deadline) prior to the Early Tender Deadline), the Issuer expects
that the “Final Settlement Date” for any Existing Notes validly
tendered after the Early Tender Deadline and at or prior to the
Expiration Time and accepted for exchange will be June 15, 2018,
unless otherwise designated by the Issuer. As of 5:00 p.m., New
York City time, on April 27, 2018, $6,000,000 aggregate principal
amount of Existing Notes, or 0.71% of the total outstanding
aggregate principal amount thereof, had been validly tendered and
not validly withdrawn in the Exchange Offer.
In addition to the conditions described in the Confidential
Offering Memorandum, dated April 6, 2018, and in the related Letter
of Transmittal and Consent (as such documents may be amended or
supplemented from time to time, including as amended on April 13,
2018, April 19, 2018 and April 23, 2018 and as described herein,
the “Exchange Offer Documents”), the Issuer announced that it will
not accept for exchange and will not exchange any Existing Notes
validly tendered (and not validly withdrawn prior to the Withdrawal
Deadline) after the Early Tender Deadline and at or prior to the
Expiration Time if the New Notes that would be issuable on the
Final Settlement Date would not be fungible for U.S. federal income
tax purposes with the New Notes issued on the Early Settlement Date
(the “Tax Fungibility Condition”).
The Exchange Offer and Existing 2022 Notes Consent Solicitation
remain conditioned upon the other conditions set forth in the
Exchange Offer Documents, and, other than the amendments described
above (including the addition of the Tax Fungibility Condition),
the other terms and conditions of the Exchange Offer and Existing
2022 Notes Consent Solicitation as set forth in the Exchange Offer
Documents remain unchanged.
Global Bondholder Services Corporation is
serving as the exchange agent, tabulation agent and information
agent for the Exchange Offer and Existing 2022 Notes Consent
Solicitation. Any question regarding procedures for tendering
Existing Notes and delivering consents in the Existing 2022 Notes
Consent Solicitation and requests for copies of the Exchange Offer
Documents may be directed to Global Bondholder Services Corporation
by phone at 866-470-4300 (toll free) or 212-430-3774.
This press release is neither an offer to
purchase or sell nor a solicitation of an offer to sell or buy the
Existing Notes, the New Notes or any other securities of the Issuer
or the Company. This press release also is not a solicitation of
consents to the proposed amendment to the indenture governing the
Existing 2022 Notes. The Exchange Offer and Existing 2022 Notes
Consent Solicitation are being made solely on the terms and subject
to the conditions set forth in the Exchange Offer Documents and the
information in this press release is qualified by reference to such
Exchange Offer Documents.
The Exchange Offer is being made within the
United States only to persons reasonably believed to be “qualified
institutional buyers” pursuant to Rule 144A under the Securities
Act of 1933, as amended (the “Securities Act”), and outside the
United States to non-U.S. investors. The New Notes have not been
and will not be registered under the Securities Act, or any state
securities laws. The New Notes may not be offered or sold within
the United States or to U.S. persons, except pursuant to an
exemption from, or in a transaction not subject to, the
registration requirements of the Securities Act and applicable
state securities laws.
About Hovnanian Enterprises®,
Inc.
Hovnanian Enterprises, Inc., founded in 1959 by
Kevork S. Hovnanian, is headquartered in Matawan, New Jersey and,
through its subsidiaries, is one of the nation’s largest
homebuilders with operations in Arizona, California, Delaware,
Florida, Georgia, Illinois, Maryland, New Jersey, Ohio,
Pennsylvania, South Carolina, Texas, Virginia, Washington, D.C. and
West Virginia. The Company’s homes are marketed and sold under the
trade names K. Hovnanian® Homes, Brighton Homes® and Parkwood
Builders. Additionally, the Company’s subsidiaries, as developers
of K. Hovnanian’s® Four Seasons communities, make the Company one
of the nation’s largest builders of active lifestyle
communities.
Forward-Looking Statements
All statements in this press release that are
not historical facts should be considered as “Forward-Looking
Statements”. Such statements involve known and unknown risks,
uncertainties and other factors that may cause actual results,
performance or achievements of the Company to be materially
different from any future results, performance or achievements
expressed or implied by the forward-looking statements. Such
forward looking statements include but are not limited to
statements related to the Company’s goals and expectations with
respect to its financial results for future financial periods.
Although we believe that our plans, intentions and expectations
reflected in, or suggested by, such forward-looking statements are
reasonable, we can give no assurance that such plans, intentions or
expectations will be achieved. By their nature, forward-looking
statements: (i) speak only as of the date they are made, (ii) are
not guarantees of future performance or results and (iii) are
subject to risks, uncertainties and assumptions that are difficult
to predict or quantify. Therefore, actual results could differ
materially and adversely from those forward-looking statements as a
result of a variety of factors. Such risks, uncertainties and other
factors include, but are not limited to, (1) changes in general and
local economic, industry and business conditions and impacts of a
sustained homebuilding downturn; (2) adverse weather and other
environmental conditions and natural disasters; (3) levels of
indebtedness and restrictions on the Company’s operations and
activities imposed by the agreements governing the Company’s
outstanding indebtedness; (4) the Company’s sources of liquidity;
(5) changes in credit ratings; (6) changes in market conditions and
seasonality of the Company’s business; (7) the availability and
cost of suitable land and improved lots; (8) shortages in, and
price fluctuations of, raw materials and labor; (9) regional and
local economic factors, including dependency on certain sectors of
the economy, and employment levels affecting home prices and sales
activity in the markets where the Company builds homes; (10)
fluctuations in interest rates and the availability of mortgage
financing; (11) changes in tax laws affecting the after-tax costs
of owning a home; (12) operations through joint ventures with third
parties; (13) government regulation, including regulations
concerning development of land, the home building, sales and
customer financing processes, tax laws and the environment; (14)
product liability litigation, warranty claims and claims made by
mortgage investors; (15) levels of competition; (16) availability
and terms of financing to the Company; (17) successful
identification and integration of acquisitions; (18) significant
influence of the Company’s controlling stockholders; (19)
availability of net operating loss carryforwards; (20) utility
shortages and outages or rate fluctuations; (21) geopolitical
risks, terrorist acts and other acts of war; (22) increases in
cancellations of agreements of sale; (23) loss of key management
personnel or failure to attract qualified personnel; (24)
information technology failures and data security breaches; (25)
legal claims brought against us and not resolved in our favor; and
(26) certain risks, uncertainties and other factors described in
detail in the Company’s Annual Report on Form 10-K for the fiscal
year ended October 31, 2017, and in the Offering Memorandum. Except
as otherwise required by applicable securities laws, we undertake
no obligation to publicly update or revise any forward-looking
statements, whether as a result of new information, future events,
changed circumstances or any other reason.
Contact: Jeffrey T. O’Keefe
Vice President of Investor Relations
732-747-7800
Ethan Lyle
Teneo Strategy
212-886-9376
Hovnanian Enterprises (NYSE:HOV)
Historical Stock Chart
From Aug 2024 to Sep 2024
Hovnanian Enterprises (NYSE:HOV)
Historical Stock Chart
From Sep 2023 to Sep 2024