TECHNICAL OLYMPIC GROUP's management informs the investment community that its subsidiary TOUSA Inc. has entered into amendments to its First Lien Term Loan Credit Agreement dated July 31, 2007, as amended (the "First Lien Term Loan Credit Agreement") and its Second Amended and Restated Revolving Credit Agreement, dated as of July 31, 2007, as amended, (the "Revolving Credit Agreement") to, among other things, (i) extend through February 1, 2008, the waiver of the financial covenants set forth in Amendment No. 1 to the First Lien Term Loan Credit Agreement and the Revolving Credit Agreement, (ii) revise the material adverse change representation with respect to matters disclosed in its quarterly report on Form 10-Q for the nine months ended September 30, 2007, (iii) modify a provision regarding the obligation to pay amounts owed in connection with certain land banking arrangements, and (iv) seek waivers of the cross-default provision resulting from any breach of a covenant regarding the matters described in (iii) above. In addition, the amendments require TOUSA to adhere to a cash flow budget, which has been prepared by TOUSA, which does not provide for current payments on its long-term indebtedness including the interest payment due on January 1, 2008 with respect to TOUSA's 10 3/8% Senior Subordinated Notes due 2012. Failure to pay interest on such notes within 30 days of the due date could result in the indebtedness represented by the notes becoming immediately due and payable and as a result cause other indebtedness of TOUSA to be accelerated and become immediately due and payable. As previously disclosed, TOUSA is considering restructuring alternatives.
TOUSA has paid a fee of approximately $1.6 million in the aggregate, plus expenses, to the lenders that consented to the amendments.
More information is available at the website of the US Securities and Exchange Commission, www.sec.gov as well as at the website of the subsidiary company, www.tousa.com.