8-KMaterial AgreementsFinancial Events

HORTON D R INC /DE/ 8-K Report, Material Agreement (Apr 13, 2005)

Filed April 13, 2005For Securities:DHI

Summary

This Form 8-K filing by D. R. Horton, Inc. (DHI) on April 13, 2005, reports on a material definitive agreement entered into by its subsidiary, DHI Mortgage Company, Ltd. The core of the report is the Second Amendment to the Amended and Restated Credit Agreement, which significantly impacts the subsidiary's financial flexibility. Key changes to the credit facility include an extension of the maturity date by one year, moving it from April 8, 2005, to April 7, 2006. Furthermore, the potential borrowing capacity under the 'accordion feature' has been tripled, increasing from $50 million to $150 million. While the committed borrowing capacity remains unchanged at $300 million, these amendments provide DHI Mortgage with enhanced access to capital and extended operational runway.

Key Highlights

  • 1DHI Mortgage Company, Ltd. (a subsidiary of D.R. Horton) entered into a Second Amendment to its Credit Facility.
  • 2The maturity date of the Credit Facility has been extended from April 8, 2005, to April 7, 2006.
  • 3The uncommitted 'accordion feature' for additional borrowings has been increased from $50 million to $150 million.
  • 4The committed borrowing capacity under the Credit Facility remains at $300 million.
  • 5The Credit Facility is secured by certain mortgage loans held for sale.
  • 6D.R. Horton, Inc. and its guarantors are not liable for this credit facility; it is non-recourse to the parent company.
  • 7Interest is calculated based on the LIBOR rate plus an applicable margin.

Frequently Asked Questions

The main purpose of this 8-K filing is to report on a material definitive agreement: a Second Amendment to the Amended and Restated Credit Agreement for DHI Mortgage Company, Ltd., a subsidiary of D.R. Horton. This amendment extends the maturity date and increases the potential borrowing capacity under an 'accordion feature'.

This amendment primarily affects DHI Mortgage Company, Ltd. D.R. Horton, Inc. itself, nor any of its guarantors for other debt, are responsible for this specific credit facility. It is secured by mortgage loans held for sale and is non-recourse to the parent company.

Extending the maturity date from April 8, 2005, to April 7, 2006, provides DHI Mortgage with an additional year of access to this credit line. This offers greater financial stability and flexibility for its operations and working capital needs over the next year.

The increase of the uncommitted 'accordion feature' from $50 million to $150 million means DHI Mortgage now has the option to borrow up to an additional $150 million beyond the $300 million committed capacity, subject to lender approval and market conditions. This significantly enhances its ability to access more capital if needed for operational expansion or other strategic purposes.