Item 1.01. Entry into a Material Definitive Agreement.
As previously reported, on November 5, 2019, William Lyon Homes, a Delaware
corporation ("Parent"), entered into an Agreement and Plan of Merger (the
"Merger Agreement") with Taylor Morrison Home Corporation, a Delaware
corporation ("Taylor Morrison"), and Tower Merger Sub, Inc. ("Merger Sub"). In
connection with the transactions related to the Merger Agreement, on December 5,
2019, Taylor Morrison Communities, Inc., a subsidiary of Taylor Morrison
("TMCI"), commenced exchange offers (the "Exchange Offers") for any and all
outstanding 6.00% Senior Notes due 2023 (the "2023 Notes"), 5.875% Senior Notes
due 2025 (the "2025 Notes") and 6.625% Senior Notes due 2027 (the "2027 Notes"
and, together with the 2023 Notes and the 2025 Notes, the "Notes") of William
Lyon Homes, Inc., a California corporation and a wholly owned subsidiary of
Parent ("California Lyon") and consent solicitations ("Consent Solicitations")
in respect of certain proposed amendments (the "Amendments") to (i) the
indenture, dated as of March 9, 2018 (as amended, the "2023 Notes Indenture"),
by and among California Lyon, the Guarantors (as defined below) and U.S. Bank
National Association, as trustee (the "Trustee"), governing the 2023 Notes,
(ii) the indenture, dated as of January 31, 2017 (as amended, the "2025 Notes
Indenture"), by and among California Lyon, the Guarantors and the Trustee,
governing the 2025 Notes and (iii) the indenture, dated as of July 9, 2019 (as
amended, the "2027 Notes Indenture" and, together with the 2023 Notes Indenture
and the 2025 Notes Indenture, the "Indentures"), by and among California Lyon,
the Guarantors and the Trustee, governing the 2027 Notes.
In connection with the Exchange Offers and Consents Solicitations, on December
18, 2019, California Lyon, Parent and certain of their subsidiaries (together
with Parent, the "Guarantors") entered into (i) Supplemental Indenture No. 2
(the "2023 Notes Supplemental Indenture") to the 2023 Notes Indenture,
(ii) Supplemental Indenture No. 2 (the "2025 Notes Supplemental Indenture") to
the 2025 Notes Indenture and (iii) Supplemental Indenture No. 1 (the "2027 Notes
Supplemental Indenture" and, together with the 2023 Notes Supplemental Indenture
and the 2025 Notes Supplemental Indenture, the "Supplemental Indentures") to the
2027 Notes Indenture.
The Supplemental Indentures, when they become operative, will effect the
Amendments, which will (i) eliminate substantially all of the covenants
contained in the Indentures, (ii) eliminate certain events of default,
(iii) modify covenants regarding mergers and transfer of all or substantially
all of the assets of Parent and its restricted subsidiaries, (iv) eliminate
certain other restrictive provisions contained in such Indentures and the Notes
and (v) reduce the minimum notice period required to optionally redeem the Notes
from 30 days to three Business Days.
The Amendments to the Indentures will not become operative unless and until
(i) TMCI or California Lyon notifies the Trustee for the applicable Notes that
TMCI has delivered to The Depository Trust Company for the holders of such Notes
the aggregate amount to be paid to such holders as consent payments, upon the
terms and subject to the conditions in TMCI's offering memorandum and consent
solicitation statement, dated December 5, 2019 (the "Offering Memorandum"), or
TMCI's separate consent solicitation statement, dated December 5, 2019, as
applicable, in respect of the consents validly delivered and not revoked
thereunder and (ii) the Notes that are validly tendered (and not validly
withdrawn) in the Exchange Offers have been accepted for exchange by TMCI in
accordance with the terms of the Offering Memorandum. If and when the Amendments
become operative, the Notes that were not tendered will remain outstanding and
will be subject to the terms of the Indentures as modified by the Supplemental
Indentures.
The foregoing descriptions of the Supplemental Indentures and the Amendments do
not purport to be complete and are qualified in their entirety by reference to
the 2023 Notes Supplemental Indenture, the 2025 Notes Supplemental Indenture and
the 2027 Notes Supplemental Indenture, copies of which are attached as Exhibit
4.1, 4.2 and 4.3, respectively, to this Current Report on Form 8-K and
incorporated herein by reference.
Item 3.03. Material Modification of Rights to Security Holders.
The information set forth in Item 1.01 is incorporated by reference herein as
such information relates to the Notes.
Item 7.01. Regulation FD Disclosure.
On December 18, 2019, Taylor Morrison issued a press release announcing the
receipt of the requisite consents in connection with the Exchange Offers and
Consent Solicitations. A copy of the press release is attached hereto as Exhibit
99.1.
The information in this Item 7.01 and Exhibit 99.1 is being furnished pursuant
to Item 7.01 of Form 8-K and shall not be deemed to be "filed" for purposes of
Section 18 of the Securities Exchange Act of 1934, as amended (the "Exchange
Act"), or otherwise subject to the liabilities of that section, nor shall it be
deemed incorporated by reference in any filing made by the Company under the
Securities Act of 1933, as amended, or the Exchange Act, except as shall be
expressly set forth by specific reference in such a filing.
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Item 9.01. Financial Statements and Exhibits.
(d) Exhibits
Exhibit
No. Description
4.1 Second Supplemental Indenture, dated December 18, 2019, among
California Lyon, the guarantors from time to time party thereto, and
U.S. Bank National Association, as trustee.
4.2 Second Supplemental Indenture, dated December 18, 2019, among
California Lyon, the guarantors from time to time party thereto, and
U.S. Bank National Association, as trustee.
4.3 First Supplemental Indenture, dated December 18, 2019, among
California Lyon, the guarantors from time to time party thereto, and
U.S. Bank National Association, as trustee.
99.1 Press Release issued by Taylor Morrison Home Corporation, dated
December 18, 2019.
104 Cover Page Interactive Data File (embedded with the Inline XBRL
document).
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