UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
Current Report
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| Item 1.01. | Entry into a Material Definitive Agreement. |
On October 2, 2020, D.R. Horton, Inc. (the “Company”) completed a public offering (the “Offering”) of $500 million aggregate principal amount of its 1.400% Senior Notes due 2027 (the “Notes”). The Company received net proceeds from the Offering, after the underwriting discount, of $495.4 million.
The Notes are governed by a Senior Debt Securities Indenture (the “Indenture”), dated as of October 10, 2019, between the Company and Truist Bank (formerly known as Branch Banking and Trust Company), as trustee (the “Trustee”), as supplemented by the Third Supplemental Indenture, dated as of October 2, 2020 (the “Third Supplemental Indenture”), among the Company, the guarantors party thereto (the “Guarantors”), and the Trustee. Interest on the Notes will accrue at a rate of 1.400% per annum on the principal amount from October 2, 2020, payable semi-annually on April 15 and October 15 of each year, beginning on April 15, 2021. The Notes will mature on October 15, 2027, subject to earlier redemption or repurchase. The Notes are guaranteed by substantially all of the Company’s current homebuilding subsidiaries.
Optional Redemption
The Company may, at its option, generally redeem all or a portion of the Notes at any time. If the Company redeems the Notes prior to August 15, 2027, the redemption price for the Notes to be redeemed will be equal to the greater of: (i) 100% of the principal amount of the Notes being redeemed plus accrued and unpaid interest to the redemption date, if any; or (ii) the sum of the present values of the principal amount of the Notes to be redeemed, together with the scheduled payments of interest (exclusive of interest to the redemption date) from the redemption date to the maturity date (assuming the Notes matured on August 15, 2027), discounted to the redemption date on a semi-annual basis, at the Treasury Rate (as defined in the Indenture), plus 15 basis points, plus accrued and unpaid interest, if any, on the principal amount of the Notes being redeemed to (but not including) the redemption date. If the Notes are redeemed on or after August 15, 2027, the redemption price for such Notes will equal 100% of the principal amount of the Notes to be redeemed, plus accrued and unpaid interest, if any, to (but not including) the date of redemption.
Change of Control
Upon the occurrence of certain events resulting in both a change in control of the Company and a ratings downgrade with respect to the Notes, subject to certain exceptions, the Company will be required to make an offer to each holder of the Notes to purchase all or any part of such holder’s Notes at 101% of the aggregate principal amount thereof, plus accrued and unpaid interest to the date of purchase.
Events of Default
The Indenture includes customary events of default, including payment defaults, failure to pay certain other indebtedness and certain events of bankruptcy, insolvency or reorganization.
Ranking
The Notes are general unsecured obligations of the Company and rank senior in right of payment to any future indebtedness of the Company that is, by its terms, expressly subordinated in right of payment to the Notes and equal in right of payment with all existing and future unsecured indebtedness of the Company that is not so subordinated. The guarantees will be general unsecured obligations of the Guarantors and will rank senior in right of payment to any future indebtedness of the Guarantors that is, by its terms, expressly subordinated in right of payment to the guarantees and will rank equal in right of payment with all existing and future unsecured indebtedness of the Guarantors that is not so subordinated.
The above description of the Notes and the Third Supplemental Indenture is qualified in its entirety by reference to the full text of the Third Supplemental Indenture (including the form of Note included therein), a copy of which is filed as Exhibits 4.1 hereto and incorporated herein by reference.
| Item 9.01. | Financial Statements and Exhibits. |
| (d) | Exhibits |
| 4.1 | Third Supplemental Indenture, dated as of October 2, 2020, among D.R. Horton, Inc., the guarantors named therein and Truist Bank (formerly known as Branch Banking and Trust Company), as trustee, relating to the 1.400% Senior Notes Due 2027 of D.R. Horton, Inc. | |
| 104 | Cover Page Interactive Data File (embedded within the Inline XBRL document). | |
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
Date: October 2, 2020
| D.R. Horton, Inc. | ||
| By: | /s/ Thomas B. Montano | |
| Thomas B. Montano | ||
| Vice President – Corporate Securities Counsel and | ||
| Corporate Secretary | ||