Hovnanian begins tender offer, consent solicitation for 10 5/8% notes

By Angela McDaniels

Tacoma, Wash., Sept. 18 - Hovnanian Enterprises, Inc. subsidiary K. Hovnanian Enterprises, Inc. began a tender offer for its 10 5/8% senior secured notes due 2016, according to a company news release.

The company is also soliciting consents to eliminate most of the restrictive covenants and some of the events of default contained in the indenture governing the notes.

The early tender deadline is 5 p.m. ET on Oct. 1, and the tender offer will expire at midnight ET on Oct. 16.

The company will pay $1,085 per $1,000 principal amount of notes. This includes an early tender payment of $30 for each note tendered by the early tender deadline.

Holders will also receive accrued interest up to but excluding the applicable payment date.

On any date after the early tender date, K. Hovnanian can accept for purchase all notes tendered by that date. If it elects to exercise this option, the company plans to do so on Oct. 2 and make payment promptly following that date.

The tender offer is subject to financing. It is not conditioned on the success of the consent solicitation.

The dealer managers and solicitation agents are Citigroup Global Markets Inc. (212 723-6106 or 800 558-3745) and Credit Suisse Securities (USA) LLC (212 538-2147 or 800 820-1653). The information agent is Global Bondholder Services Corp. (866 470-4200 or, for banks and brokers, 212 430-3774).

Hovnanian is a homebuilder based in Red Bank, N.J.

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