Taylor Morrison Home Corp 8-K

What Happened
Taylor Morrison Home Corporation (through its subsidiary Taylor Morrison Communities, Inc.) announced on Dec. 22, 2025 that it entered into an Amendment and Restatement to its existing credit agreement, creating a $1.0 billion revolving credit facility with an uncommitted accordion of up to $400 million. The facility amends and restates the March 11, 2022 credit agreement and matures five years from the closing date. Wells Fargo Bank, N.A. is the successor administrative agent under the new Credit Agreement.

Key Details

• Facility size: $1,000,000,000 revolving commitments with an uncommitted accordion up to $400,000,000. Maturity: 5 years from Dec. 22, 2025.
• Interest and fees: Borrowings bear interest at either (a) base rate + margin (floor 0.00%) or (b) SOFR + margin (floor 0.00%). Margins depend on credit ratings and capitalization ratio:
  • If rated investment grade by ≥2 agencies: base-rate margin = 0.10% or SOFR margin = 1.10%; commitment fee = 0.125%.
  • If not investment grade: base-rate margin = 0.25%–0.625% or SOFR margin = 1.25%–1.625%; commitment fee = 0.150%–0.300% (ranges vary by capitalization ratio).
• Covenants and financial tests: no scheduled amortization; mandatory prepayment if capitalization ratio exceeds 0.55:1 to bring borrowings within borrowing base; quarterly compliance when loans/outstanding letters of credit conditions apply with a maximum capitalization ratio of 0.60:1 and a minimum consolidated tangible net worth of $4,131,006,729 (plus specified adjustments).
• Security and guarantees: obligations are unsecured but unconditionally guaranteed by specified parent and subsidiary entities (Holdings, U.S. Holdings, U.S. FinCo and certain restricted subsidiaries), subject to customary exceptions.

Why It Matters
This new committed revolving facility provides Taylor Morrison with up to $1.0 billion of liquidity (plus a potential $400 million accordion) and replaces its prior agreement, giving the company predictable access to working capital for homebuilding operations. The cost to borrow will vary with the company’s credit ratings and capitalization ratio, so financing costs could fall or rise as those metrics change. The covenant package (leverage and net worth tests and customary restrictions on liens, payments, investments and dispositions) can limit certain corporate actions (like dividends, acquisitions or asset sales) while loans are outstanding, which is important for investors monitoring cash flow flexibility and capital allocation.