HOVNANIAN ENTERPRISES INC (HOV) SPO
|Company Name||HOVNANIAN ENTERPRISES INC|
|Company Address||110 WEST FRONT STREET
P.O. BOX 500
RED BANK, NJ 07701
|Company Phone||(732) 747-7800|
|CEO||Ara K. Hovnanian|
|Employees (as of 10/31/2011)||1500|
|State of Inc||DE|
|Fiscal Year End||10/31|
|Exchange||New York Stock Exchange|
|Shares Over Alloted||0|
|Shareholder Shares Offered||--|
|Lockup Period (days)||180|
|Quiet Period Expiration||5/14/2012|
We expect to receive net proceeds from this offering of approximately $57.1 million (or approximately $65.7 million if the underwriters exercise their overallotment option in full), based on an assumed public offering price of $2.42 per share, the closing price of our Class A Common Stock on April 2, 2012 as reported on the New York Stock Exchange, after deducting the underwriting discounts and estimated offering expenses payable by us. We intend to use the net proceeds from this offering to purchase approximately $15.3 million principal amount of our 6 1 / 4 % Senior Notes due January 15, 2016, approximately $22.8 million principal amount of our 7 1 / 2 % Senior Notes due May 15, 2016 and approximately $37.4 million principal amount of our 8 5 / 8 % Senior Notes due January 15, 2017 in a private transaction and for general corporate purposes, including the refinancing, repurchase or repayment of indebtedness, working capital needs, capital expenditures and expansion of the business.
We compete not only for home buyers but also for desirable properties, financing, raw materials, and skilled labor often within larger subdivisions designed, planned, and developed by other homebuilders. Our competitors include other local, regional, and national homebuilders, some of which have greater sales and financial resources. The competitive conditions in the homebuilding industry together with current market conditions have, and could continue to, result in: • difficulty in acquiring suitable land at acceptable prices; • increased selling incentives; • lower sales; or • delays in construction. Any of these problems could increase costs and/or lower profit margins.
We design, construct, market, and sell single-family detached homes, attached townhomes and condominiums, urban infill and active adult homes in planned residential developments and are one of the nation’s largest builders of residential homes. Founded in 1959 by Kevork Hovnanian, Hovnanian
Enterprises, Inc. was incorporated in New Jersey in 1967 and reincorporated in Delaware in 1983. Since the incorporation of our predecessor company and including unconsolidated joint ventures, we have delivered in excess of 295,000 homes, including 4,216 homes in fiscal 2011. The Company consists of two distinct operations: homebuilding and financial services. Our homebuilding operations consist of six segments: Northeast, Mid-Atlantic, Midwest, Southeast, Southwest and West. Our financial services operations provide mortgage loans and title services to the customers of our homebuilding operations. We are currently offering homes for sale in 197 communities in 37 markets in 16 states throughout the United States, excluding unconsolidated joint ventures. We market and build homes for first-time buyers, first-time and second-time move-up buyers, luxury buyers, active adult buyers, and empty nesters. We offer a variety of home styles at base prices ranging from $75,500 (low income housing) to $1,795,000 with an average sales price, including options, of $280,000 nationwide in fiscal 2011. We market and build homes that are constructed in 19 of the nation’s top 50 housing markets. We segregate our homebuilding operations geographically into the following six segments: Northeast: New Jersey and Pennsylvania Mid-Atlantic: Delaware, Maryland, Virginia, West Virginia and Washington, D.C. Midwest: Illinois, Minnesota and Ohio Southeast: Florida, Georgia, North Carolina and South Carolina Southwest: Arizona and Texas West: California Our corporate offices are located at 110 West Front Street, P.O. Box 500, Red Bank, New Jersey 07701, our telephone number is 732-747-7800, and our Internet web site address is www.khov.com.
|Auditor||Deloitte & Touche LLP|
|Company Counsel||Simpson Thacher & Bartlett LLP|
|Company Counsel||Simpson Thacher & Bartlett LLP and Peter S. Reinhart, Esq.|
|Lead Underwriter||Citigroup Global Markets Inc|
|Lead Underwriter||Credit Suisse Securities (USA) LLC|
|Lead Underwriter||J.P. Morgan Securities LLC|
|Underwriter||Credit Suisse Securities (USA) LLC|
|Underwriter||J.P. Morgan Securities LLC|
|Underwriter Counsel||Davis Polk & Wardwell LLP|
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