Oct. 5, 2009 (PR Newswire) --
RED BANK, N.J., Oct. 5 /PRNewswire-FirstCall/ -- Hovnanian Enterprises, Inc. (NYSE: HOV) (the "Company") announced today that its wholly owned subsidiary, K. Hovnanian Enterprises, Inc. ("K. Hovnanian"), priced $785 million aggregate principal amount of 10.625% senior secured notes due October 15, 2016 (the "Notes") in a private placement.
The Notes and the guarantees thereof by the Company and certain of its subsidiaries will be secured on a first-priority lien basis on substantially all the assets owned by K. Hovnanian and the guarantors, subject to permitted liens and certain exceptions.
K. Hovnanian intends to use the net proceeds from the offering of the Notes together with cash on hand to fund its previously announced tender offers and consent solicitations (the "Tender Offers") for its outstanding second and third lien senior secured notes and certain series of senior unsecured notes commenced pursuant to the Offer to Purchase and Consent Solicitation Statement dated September 21, 2009, as amended, and to pay related fees and expenses. In conjunction with the closing of the Notes offering, K. Hovnanian expects to consummate the Tender Offers and to terminate its existing revolving credit facility and enter into certain letter of credit agreements.
The Notes have not been registered under the Securities Act of 1933, as amended (the "Securities Act"). The Notes may not be offered or sold within the United States or to U.S. persons, except to "qualified institutional buyers" in reliance on the exemption from registration provided by Rule 144A and to certain persons in offshore transactions in reliance on Regulation S. You are hereby notified that sellers of the Notes may be relying on the exemption from the provisions of Section 5 of the Securities Act provided by Rule 144A. This announcement does not constitute an offer to sell or the solicitation of an offer to buy Notes in any jurisdiction in which such an offer or sale would be unlawful.
About Hovnanian Enterprises
Hovnanian Enterprises, Inc., founded in 1959 by Kevork S. Hovnanian, is headquartered in Red Bank, New Jersey. The Company is one of the nation's largest homebuilders with operations in Arizona, California, Delaware, Florida, Georgia, Illinois, Kentucky, Maryland, Minnesota, New Jersey, New York, North Carolina, Ohio, Pennsylvania, South Carolina, Texas, Virginia and West Virginia. The Company's homes are marketed and sold under the trade names K. Hovnanian® Homes®, Matzel & Mumford, Brighton Homes, Parkwood Builders, Town & Country Homes, Oster Homes, First Home Builders of Florida and CraftBuilt Homes. As the developer of K.
