The purpose of this clause is to provide stability for the children's living arrangements and thus caselaw defines exactly what this means:
47 S.W.3d 222
TAYLOR v. TAYLOR, 345 Ark. 300, (Ark. 06/21/2001)
Which finds the following:
The Campbell court stated that the purpose of the overnight-guest order is to promote a stable environment for the children and is not imposed merely to monitor a parent's sexual conduct. 336 Ark at 389.
As emphasized by our court's earlier decisions, the trial court's use of the non-cohabitation restriction is a material factor to consider when determining custody issues. Id. Such a restriction or prohibition aids in structuring the home place so as to reduce the possibilities (or opportunities) where children may be [345 Ark Page 305]
 present and subjected to a single parent's sexual encounters, whether they be heterosexual or homosexual. *fn1
In other words, it is NOT the hours that the person is in the residence but the fact that they call this their residence part of the time when the children are there that is at issue. Mom is in contempt per OP's description.
Finally, Linda argues that the chancellor's finding of contempt was in error because she had complied with the non-cohabitation clause contained in the temporary custody order by making arrangements so that she and Richards never slept in the home on the same night. From Linda's and Christina's own admissions at the final hearing, and despite the living arrangements that she devised in reaction to the non-cohabitation order, Linda still considered Christina to be a resident of the household and allowed her to remain living there overnight in the presence of the children, three nights a week when Linda worked overnight shifts. [345 Ark Page 307]
  As the chancellor noted in finding Linda in contempt of his order, the temporary order clearly mandated that Christina be removed from the same household as the children and forbade Linda from sharing the residence and living arrangements with Christina when the children were present. Christina's continued residence in the home was a violation of the express terms of the non-cohabitation clause, and the chancellor did not err in holding Linda in contempt. It is important to note that the custody order conditions Linda's continued custody on compliance with this provision and allows custody to revert to Chris Taylor should he demonstrate that Linda has failed to comply with the non-cohabitation order.
Parents should remember 3 things: Love your kids more than you hate your ex; when you have children the relationship with the other parent is until death; your children determine what type of nursing home you end up in.
Nothing stated by me should be taken as giving you legal advice or forming an attorney/client relationship.
Attorney-GAL in Ohio.
I've removed the knife from my back, polished it, and will one day return it -- long after you think I have forgotten.