HOVNANIAN ENTERPRISES, INC. (OTCMKTS:HOVVB) Files An 8-K Regulation FD DisclosureItem 7.01. Regulation FD Disclosure.
K. Hovnanian at Sunrise Trail III, LLC (“Sunrise Trail”), a wholly-owned subsidiary of Hovnanian Enterprises, Inc. (the “Company”), owns $26.0 million aggregate principal amount (the “Affiliate-held Notes”) of the Issuer’s 8.000% Senior Notes due 2019 (the “8.000% Notes”) that were acquired through an exchange offer consummated on February1, 2018. Covenants under the Indenture governing the Issuer’s 13.5% Senior Notes due 2026 and 5.0%Senior Notes due 2040 prohibit the Issuer from making interest payments on the Affiliate-held Notes. As a result, although the Issuer made the regularly scheduled interest payment due on May 1, 2018 on all 8.000% Notes other than the Affiliate-held Notes, and intends to continue to pay interest on such other 8.000% Notes, the Issuer did not make the $1.04million interest payment due on the Affiliate-held Notes. The Issuer’s non-payment of the interest due on the Affiliate-held Notes, the payment of which has not been waived by Sunrise Trail, constitutes a “Default” under the Indenture governing the 8.000% Notes (the “8.000% Senior Notes Indenture”) and will constitute an “Event of Default” under the 8.000% Senior Notes Indenture if such payment is not made within the 30-day grace period provided for thereunder.
About HOVNANIAN ENTERPRISES, INC. (OTCMKTS:HOVVB)
Hovnanian Enterprises, Inc. is a builder of residential homes. The Company designs, constructs, markets and sells single-family detached homes, attached townhomes and condominiums, urban infill and active lifestyle homes in planned residential developments. The Company has two distinct operations: homebuilding and financial services. Its homebuilding operations consist of six segments: Northeast: New Jersey and Pennsylvania; Mid-Atlantic: Delaware, Maryland, Virginia, Washington, District of Columbia, and West Virginia; Midwest: Illinois and Ohio; Southeast: Florida, Georgia and South Carolina; Southwest: Arizona and Texas, and West: California. Its financial services operations provide mortgage loans and title services to the customers of its homebuilding operations. The Company markets and builds homes for first-time buyers, first-time and second-time move-up buyers, luxury buyers, active lifestyle buyers and empty nesters.