Beazer Homes solicits consents for $1.525 billion of notes, convertibles

By Jennifer Chiou

New York, Oct. 15 - Beazer Homes USA, Inc. announced the start of a consent solicitation for its $1.525 billion of senior notes and senior convertible notes.

The Atlanta-based single-family homebuilder is soliciting consents to amend the note indentures to obtain a waiver for the requirement that it be required to file forms, including 10-Qs, with the Securities and Exchange Commission.

The amendments include a proposed covenant that obligates Beazer after May 15, 2008 to file reports with the SEC and deliver them to the trustees and holders, and provides for additional interest of 50 basis points per year if Beazer fails to comply with the obligations on a timely basis.

The solicitation ends at 5 p.m. ET on Oct. 24.

For each $1,000 principal amount, the company is offering a consent fee equal to the product of $5.00 multiplied by a fraction, the numerator of which is the aggregate principal amount of notes, and the denominator of which is the amount of notes for which the company has accepted consents.

As previously disclosed, Beazer's delay in filing its 10-Q for the period ended June 30 is the result of an independent internal investigation by the audit committee of the company's board.

On Oct. 11, the company said that the audit committee determined that it will be necessary for the company to restate its financial statements relating to fiscal years 2004 through 2006 and the interim periods of fiscal 2006 and fiscal 2007.

The restatement is also expected to impact the financial results for fiscal years 1999 through 2003 and Beazer said it expects that it will reflect the impact of financial results for these prior years as a part of the opening balances in the financial statements for the restatement period.

MacKenzie Partners, Inc. is the information agent and tabulation agent (800 322-2885 or call collect 212 929-5500). Citi (800 558-3745 or call collect 212 723-6106), Wachovia Securities (866 309-6316 or call collect 704 715-8341) and RBS Greenwich Capital (877 297-9832 or call collect 203 618-6145) are the solicitation agents.

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