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To: Karl Schwarszchild who wrote (1543)	3/16/1998 11:28:00 AM
From: Karl Schwarszchild	Respond to of 2063

Regarding Hovnanian Enterprises, the real-estate development aspect of the Hovnanian family, note that its stock is trading at or near its 52 wk high. Among other things, HE's last quarterly report discloses holdings of $444m in property, a $245m revolving line of credit, and quarterly revenues up 78% to $204m (which made for a +59% earnings surprise).

To: Karl Schwarszchild who wrote (1543)	3/16/1998 11:46:00 PM
From: Ken98	Read Replies (1) \| Respond to of 2063

Karl, went back and looked at the 1/30/98 press release and the 1996 10K regarding possible line of credit and did not find anything but once again re-read the 1/30 press release and noticed even more stuff: <<On January 21, 1998, the Company issued new Subordinated Exchange Notes, in the aggregate principal amount of $1,191,147 (the "New Notes"), to the holders (the "Holders") of the Company's Subordinated Exchange Notes (the "Original Notes") in exchange for $1 million in cash and as payment of $191,147 in respect of an interest payment due on December 28, 1997. Also in connection with the issuance of the New Notes, the Holders waived certain defaults under the Original Notes.>> This quote seems to imply ("waived certain defaults") that the company missed the interest payment due on 12/28/97 in the amount of $191,147. The new amount of $1,191,147 covered the past-due interest payment and advanced $1 million in cash. At least on 1/21 when the new loan was made the 12/28 interest payment had not been made. There is another interest payment due under the Subordinated Exchange Notes in 2 weeks on 3/31/98. Trying to follow all of the legal niceties, I went back to the 10K to look at the info. regarding the "Subordinated Exchange Notes" which are the Morgan notes. The original Morgan notes were executed some time ago in about $15 million. Thereafter, Morgan converted $10 million in principal for 604,508 shares of CVUS stock. The remaining $5 million + $1.3 million in interest became the "Subordinated Exchange Notes". These bear interest at prime + 6% with a 10% floor and 15% ceiling. Interest is payable quarterly. Next principal payment is 6/98 for 5/11 of outstanding principal balance. Let me know if you find the info. about the line of credit.