A wholly owned subsidiary of Hovnanian Enterprises Inc. launched a private offer to exchange up to $185.0 million of its outstanding 8.000% senior notes due 2019 for cash; newly issued 13.5% senior notes due Feb. 1, 2026; and newly issued 5.0% senior notes due Feb. 1, 2040.
The exchange offer will expire Jan. 29, 2018, at 11:59 p.m. ET, unless extended or earlier terminated. Interest on the new 2026 notes and 2040 notes will be paid Feb. 1 and Aug. 1 of each year, beginning Aug. 1, 2018.
In connection with the exchange offer, the company entered into an agreement with Blackstone Group LP's credit platform GSO Capital Partners and associated funds to refinance certain of the 2019 notes and to purchase $25 million of the 2024 notes.
GSO Capital Partners and its associated funds will also provide the company with a new $125 million senior secured first-lien revolving credit facility, with $75 million to go toward refinancing its existing first priority secured term loan and the rest toward general corporate purposes.