Beazer Homes Receives Notice of Default
ATLANTA (AP) - Homebuilder Beazer Homes USA Inc. says it has received default notices for five senior notes due between 2011 and 2016, though the company denies it is in default on that debt.
Shares fell 9 percent in morning trading after the company made the announcement Friday, a little more than two weeks after Beazer had asked a federal court to stop U.S. Bank National Association from demanding the builder repay $1.38 billion in loans.
Minnesota-based U.S. Bank is the trustee for the loans, meaning it must ensure that the borrower is in compliance with the lending terms. The bank also enforces any default declaration by the lenders.
The notices from U.S. Bank concerning the debt said Beazer had gone into default because it hasn't filed its 10-Q report with the Securities and Exchange Commission for the quarter that ended June 30 and thus failed to deliver those files to the trustee.
It gives the company 60 days to do so.
But Beazer said in a statement that it believes the notices are invalid because the company is only required to give the trustee copies of its report 15 days after delivering it to the SEC.
Beazer spokesman Leslie Kratcoski declined to comment further Friday afternoon.
''We are not speculating on any possible outcomes,'' she said, adding the litigation is ongoing.
U.S. Bank spokesman Steve Dale declined to comment Friday.
In the complaint filed in August in U.S. District Court in Atlanta, Beazer said many of its noteholders have bought company bonds at depressed prices in the market and are trying to make ''a windfall by demanding accelerated repayment in full.''
Beazer delayed filing its fiscal third-quarter results after the company discovered accounting irregularities that may force it to restate financial results. Most corporate loans depend upon the company being up-to-date with its regulatory filings, mainly quarterly and annual financial statements.
ATLANTA (AP) - Homebuilder Beazer Homes USA Inc. says it has received default notices for five senior notes due between 2011 and 2016, though the company denies it is in default on that debt.
Shares fell 9 percent in morning trading after the company made the announcement Friday, a little more than two weeks after Beazer had asked a federal court to stop U.S. Bank National Association from demanding the builder repay $1.38 billion in loans.
Minnesota-based U.S. Bank is the trustee for the loans, meaning it must ensure that the borrower is in compliance with the lending terms. The bank also enforces any default declaration by the lenders.
The notices from U.S. Bank concerning the debt said Beazer had gone into default because it hasn't filed its 10-Q report with the Securities and Exchange Commission for the quarter that ended June 30 and thus failed to deliver those files to the trustee.
It gives the company 60 days to do so.
But Beazer said in a statement that it believes the notices are invalid because the company is only required to give the trustee copies of its report 15 days after delivering it to the SEC.
Beazer spokesman Leslie Kratcoski declined to comment further Friday afternoon.
''We are not speculating on any possible outcomes,'' she said, adding the litigation is ongoing.
U.S. Bank spokesman Steve Dale declined to comment Friday.
In the complaint filed in August in U.S. District Court in Atlanta, Beazer said many of its noteholders have bought company bonds at depressed prices in the market and are trying to make ''a windfall by demanding accelerated repayment in full.''
Beazer delayed filing its fiscal third-quarter results after the company discovered accounting irregularities that may force it to restate financial results. Most corporate loans depend upon the company being up-to-date with its regulatory filings, mainly quarterly and annual financial statements.
