UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported): December 3, 2008
HOVNANIAN ENTERPRISES, INC.
(Exact Name of Registrant as Specified in Charter)
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| Delaware
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1-8551
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22-1851059 |
(State or Other
Jurisdiction
of Incorporation)
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(Commission File Number)
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(I.R.S. Employer
Identification No.) |
110 West Front Street
P.O. Box 500
Red Bank, New Jersey 07701
(Address of Principal Executive Offices) (Zip Code)
(732) 747-7800
(Registrant’s telephone number, including area code)
Not Applicable
(Former Name or Former Address, if Changed Since
Last Report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the
filing obligation of the registrant under any of the following provisions (see General Instruction
A.2. below):
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Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
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Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
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Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR
240.14d-2(b)) |
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Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR
240.13e-4(c)) |
Item 1.01. Entry into a Material Definitive Agreement.
On December 3, 2008, K. Hovnanian Enterprises, Inc. (“K. Hovnanian”), a wholly owned
subsidiary of Hovnanian Enterprises, Inc. (“Hovnanian”), entered into an Indenture among K.
Hovnanian, Hovnanian, the other guarantors named therein and Wilmington Trust Company, as trustee
(the “Indenture”), under which K. Hovnanian issued $29,299,000 aggregate principal amount of 18.0%
Senior Secured Notes due 2017 (the “New Secured Notes”) which are guaranteed by Hovnanian and
substantially all of its subsidiaries, in exchange for senior unsecured notes of K. Hovnanian
tendered by holders thereof in a private exchange offer (the “Private Exchange Transaction”). The
senior unsecured notes exchanged in the Private Exchange Transaction consisted of $560,000 in
aggregate principal amount of 8% Senior Notes due 2012 (the “8% 2012 Notes”), $11,975,000 in
aggregate principal amount of 61/2% Senior Notes due 2014 (the “61/2% 2014 Notes”), $1,132,000 in
aggregate principal amount of 63/8% Senior Notes due 2014 (the “63/8% 2014 Notes”), $3,297,000 in
aggregate principal amount of 61/4% Senior Notes due 2015 (the “61/4% 2015
Notes”), $24,764,000 in aggregate principal amount of 71/2% Senior Notes due 2016 (the “71/2% 2016
Notes”), $28,675,000 in aggregate principal amount of 61/4% Senior Notes due 2016 (the “61/4% 2016
Notes”) and $1,012,000 in aggregate principal amount of 85/8% Senior Notes due 2017 (the “85/8% 2017
Notes”). After completion of the Private Exchange Transaction, the outstanding amounts of K. Hovnanian’s senior
unsecured notes are $99,440,000 aggregate principal amount of 8% 2012 Notes, $203,025,000 aggregate
principal amount of 61/2% 2014 Notes, $148,868,000 aggregate principal amount of 63/8% 2014 Notes,
$196,703,000 aggregate principal amount of 61/4% 2015 Notes, $275,236,000 aggregate principal amount
of 71/2% 2016 Notes, $271,325,000 aggregate principal amount of 61/4% 2016 Notes and $248,988,000
aggregate principal amount of 85/8% 2017 Notes.
Each of Hovnanian’s
subsidiaries, except for certain of its financial service subsidiaries and
joint ventures, is a guarantor of the New Secured Notes. The New Secured Notes and the guarantees
will be secured, subject to permitted liens and other exceptions, by a third-priority lien on
substantially all of the assets owned by K. Hovnanian, Hovnanian and the other guarantors to the
extent such assets secure obligations under K. Hovnanian’s Revolving Credit Agreement and
second-priority secured notes.
The New Secured Notes bear interest at 18.0% per annum and mature on May 1, 2017. Interest is
payable semi-annually on May 1 and November 1 of each year, beginning on May 1, 2009, to holders of
record at the close of business on April 15 or October 15, as the case may be, immediately
preceding each such interest payment date.
The Indenture contains restrictive covenants that limit among other things, the ability of
Hovnanian and certain of its subsidiaries, including K. Hovnanian, to incur additional
indebtedness, pay dividends and make distributions on common and preferred stock, repurchase senior
and subordinated notes and common and preferred stock, make other restricted payments, make
investments, sell certain assets, incur liens, consolidate, merge, sell or otherwise dispose of all
or substantially all of its assets and enter into certain transactions with affiliates. The
Indenture also contains customary events of default which would permit the holders of the New
Secured Notes to declare those New Secured Notes to be immediately due and payable if not cured
within applicable grace periods, including the failure to make timely payments on the New Secured
Notes or other material indebtedness, the failure to satisfy covenants, the failure of the
documents granting security for the New Secured Notes to be in full force and effect, the failure
of the liens on any material portion of the collateral securing the New Secured Notes to be valid
and perfected and specified events of bankruptcy and insolvency.
Item 2.03. Creation of a Direct Financial Obligation or an Obligation Under an Off-Balance Sheet Arrangement of a Registrant.
The information set forth above under Item 1.01 of this Current Report on Form 8-K is
incorporated by reference into this Item 2.03.
Item 9.01. Financial Statements and Exhibits.
(d) Exhibits
2