The Indenture
contains covenants that limit the ability of the Company and
certain of its subsidiaries to (i)pay dividends, or make other
distributions or redeem or repurchase the Companys capital stock;
(ii)prepay, redeem or repurchase certain debt; (iii)incur
additional and guarantee indebtedness; (iv)issue certain
preferred stock or similar equity securities; (v)make loans and
investments; (vi)incur liens; (vii)sell assets; (viii)enter into
transactions with affiliates; (ix)enter into agreements
restricting their subsidiaries ability to pay dividends; and
(x)consolidate, merge or sell all or substantially all assets.
These covenants are subject to important exceptions and
qualifications.

The Indenture
provides that upon specific change of control events that result
in a corporation or other legal entity with specified unsecured
debt ratings expressly assuming the notes and related obligations
or irrevocably and unconditionally guaranteeing the notes and
related obligations (a covenant replacement event), certain
covenants will no longer apply to the 2022 Notes and will be
replaced with new covenants. If the Company experiences specific
kinds of changes in control that do not result in a covenant
replacement event, holders of the 2022 Notes will be entitled to
require the Company to purchase all or a portion of the 2022
Notes at 101% of their principal amount, plus accrued and unpaid
interest to but excluding the date of repurchase. Following a
covenant replacement event, upon the occurrence of specific kinds
of changes of control that result in a downgrade of the rating
assigned to the 2022 Notes, holders of the 2022 Notes will be
entitled to require the Company to purchase all or a portion of
the 2022 Notes at 101% of their principal amount, plus accrued
and unpaid interest to but excluding the date of
repurchase.

The Indenture is
filed as Exhibit 4.1 to this Current Report on Form 8-K and is
incorporated herein by reference. The description of the material
terms of the Indenture above is qualified in its entirety by
reference to Exhibit 4.1.

Registration
Rights Agreement

In connection with
the closing of the offering of the 2022 Notes, the Company, the
Subsidiary Guarantors and the initial purchasers of the 2022
Notes entered into a registration rights agreement dated May18,
2017 in respect of the 2022 Notes (the Registration Rights
Agreement). to the terms of the Registration Rights Agreement,
the Company agreed, among other things, to use its reasonable
best efforts to file a registration statement with the Securities
and Exchange Commission to exchange the 2022 Notes and related
guarantees with registered notes having substantially the same
terms and the 2022 Notes and evidencing the same indebtedness as
the 2022 Notes and registered guarantees having substantially the
same terms as the original Note guarantees. Under the terms of
the Registration Rights Agreement, the Company agreed to use its
reasonable best efforts to cause the exchange to be completed
within 360 days after the issuance of the Notes, or, if required,
to file a shelf registration statement to cover re-sales of the
2022 Notes and related guarantees under certain
circumstances.

The Registration
Rights Agreement is filed as Exhibit 4.2 to this Current Report
on Form 8-K and is hereby incorporated herein by reference. The
description of the material terms of the Registration Rights
Agreement is qualified in its entirety by reference to
Exhibit4.2.

Unsecured
Credit Agreement

On May18, 2017,
the Company entered into an unsecured revolving credit agreement
(the Unsecured Credit Agreement) with each of the financial
institutions party thereto, JPMorgan Chase Bank, N.A., as
administrative agent and Citibank, N.A., as syndication
agent.

The Unsecured
Credit Agreement has substantially similar terms and provisions
to the 2014 Secured Credit Agreement (as defined below), except
that the facility is no longer secured by substantially all of
the assets of the Company and certain of its subsidiaries.

The Unsecured
Credit Agreement includes a revolving credit facility in an
aggregate principal amount of up to $155.0million, with an
accordion feature that allows us, with the consent of the
lenders, to increase the aggregate amount to $250.0million. The
facility includes a letter of credit sub-facility in an amount
equal to 50% of total commitments then in effect. The maximum
amount available under the Unsecured Credit Agreement is limited
to the lesser of (x) $155million (subject to increase to the
accordion) and (y)an amount equal to the borrowing base minus the
Companys consolidated senior debt. The borrowing base includes
50% of unrestricted cash, to the extent it exceeds the interest
reserve, and escrowed deposits and funds payable to us following
the sale of real property, plus the following, subject to certain
limitations:

To be included in
the borrowing base, the real property must be owned by the
Company or one of our subsidiaries that guaranties the Companys
obligations under the Unsecured Credit Agreement and meet certain
criteria.

Interest will be
payable on revolving credit borrowings at variable rates
determined by the applicable LIBOR plus 3.25% or the prime rate
plus 2.25%, at our election. We pay quarterly fees of 0.50% per
annum on the unused portion of the lenders commitments under the
Unsecured Credit Agreement to the lenders, 0.125% per annum on
the aggregate undrawn amount of each letter of credit to the
issuer of such letter of credit, and 3.25% per annum on the
aggregate undrawn amount of all letters of credit to the
lenders.

The Unsecured
Credit Agreement expires on July28, 2020. Upon expiration, all
borrowings become due and payable. We may prepay loans borrowed
under the Unsecured Credit Agreement or reduce the commitments
thereunder at our option, without any prepayment fee or
penalty.

The Unsecured
Credit Agreement is guaranteed by certain of our subsidiaries,
which include the following: Avatar Properties Inc., AVH
Bethpage, LLC, AVH Carolinas, LLC, AVH North Florida, LLC, AVH
EM, LLC, AV Homes of Arizona, LLC, Bonterra Builders, LLC, JCH
Group LLC, Royal Oak Homes, LLC and Vitalia at Tradition, LLC. We
have the option to add or remove guarantors from time to time,
subject to certain limitations.

The Unsecured
Credit Agreement contains certain restrictions and covenants,
which, among other things, restrict our ability to acquire or
merge with another entity, make investments, loans or guarantees,
incur additional indebtedness, create liens or other
encumbrances, or pay cash dividends or make other
distributions.

The Unsecured
Credit Agreement also requires that we comply with the following
financial covenants as of the end of each fiscal quarter:

Certain of the
lenders and their affiliates have performed and may in the future
perform various commercial banking, investment banking and other
financial advisory services for us for which they have received
and will receive customary fees and expenses.

The foregoing
description of our Unsecured Credit Agreement is qualified in its
entirety by reference to the full text of the credit agreement
that is filed as Exhibit10.1 hereto and incorporated herein by
reference.

The Unsecured
Credit Agreement replaced in its entirety that certain Credit
Agreement, dated as of April7, 2014 (as amended from time to
time, the 2014 Secured Credit Agreement), by and among the
Company, each of the financial institutions party thereto, and
JPMorgan Chase Bank, N.A., as administrative agent.

Item2.03
Creation of a Direct Financial Obligation or an Obligation Under
an Off- Balance Sheet Arrangement of the
Registrant.

The information
set forth under Offering of Senior Notes, The Indenture, and
Registration Rights Agreement in Item 1.01 above is incorporated
by reference into this Item 2.03.

Offering of
Senior Notes

On May18, 2017,
the Company issued a press release announcing the closing of the
Companys private offering of the 2022 Notes. A copy of the press
release is attached as Exhibit 99.1 to this Current Report on
Form 8-K and is incorporated herein by reference.

Tender
Offer

On May18, 2017,
the Company issued a press release announcing the initial results
of its previously announced tender offer for any and all of its
8.500% Senior Notes due 2019. A copy of the press release is
attached as Exhibit99.2 to this Current Report on Form
8-K and is
incorporated herein by reference.

(d) Exhibits