UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
CURRENT REPORT
Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): September 12, 2019 (
(Exact name of registrant as specified in its charter)
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(Commission File Number) |
(I.R.S. Employer Identification No.) |
(Address of principal executive offices and zip code)
(Registrant’s telephone number, including area code)
(Former Name or Former Address, if Changed Since Last Report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):
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Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
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Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
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Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
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Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Securities registered pursuant to Section 12(b) of the Act:
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Trading Symbol(s) |
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Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
| Item 1.01 | Entry into a Material Definitive Agreement. |
On September 9, 2019, Toll Brothers Finance Corp. (the “Issuer”), a wholly-owned subsidiary of Toll Brothers, Inc. (the “Company”) entered into an underwriting agreement (the “Underwriting Agreement”) with the Company, as guarantor, and BofA Securities Inc., Citigroup Global Markets Inc., Goldman Sachs & Co. LLC., Mizuho Securities USA LLC, PNC Capital Markets LLC, SunTrust Robinson Humphrey, Inc. and Wells Fargo Securities, LLC, as representatives of the several underwriters named therein (the “Underwriters”), with respect to a public offering of $400,000,000 aggregate principal amount of its 3.800% Senior Notes due 2029 (the “Senior Notes”), guaranteed by the Company and certain of its subsidiaries. The Underwriting Agreement contains the terms and conditions of the offering and sale of the Senior Notes, indemnification and contribution obligations and other customary terms and conditions.
On September 12, 2019, the Issuer completed the offering of the Senior Notes. The Senior Notes have been registered under the Securities Act of 1933, as amended (the “Securities Act”), pursuant to the Company’s universal shelf registration statement on Form S-3 (File No. 333-222996), as supplemented by the prospectus supplement dated September 9, 2019, filed with the Securities and Exchange Commission under the Securities Act.
The Senior Notes were issued (and the guarantees delivered) pursuant to an indenture (the “Base Indenture”), dated as of February 7, 2012, among the Issuer, the guarantors named therein, including the Company (collectively, the “Guarantors”), and The Bank of New York Mellon, as trustee (the “Trustee”), as amended and supplemented by the resolution authorizing the Senior Notes, dated as of September 12, 2019 (the “Authorizing Resolution” and, together with the Base Indenture, the “Indenture”). Copies of the Underwriting Agreement, the Base Indenture, the Authorizing Resolution, and the form of Senior Note are attached hereto as Exhibits 1.1, 4.1, 4.2 and 4.3, respectively, and are incorporated herein by reference. The description of the Underwriting Agreement, the Indenture and the Senior Notes in this report are summaries and are qualified in their entirety by the terms of the Underwriting Agreement, the Indenture and the form of Senior Note.
The Senior Notes are unsecured and unsubordinated obligations of the Issuer and rank equally and ratably with the other unsecured and unsubordinated indebtedness of the Issuer. The Senior Notes and the guarantee of the Company are structurally subordinated to the prior claims of creditors of non-guarantor subsidiaries of the Company.
The Issuer will pay interest on the Senior Notes semi-annually in arrears on May 1 and November 1, beginning May 1, 2020 to holders of record on the preceding April 15 or October 15, as the case may be. Interest will be calculated on the basis of a 360-day year of twelve 30-day months. The Senior Notes will mature on November 1, 2029.
The Issuer may redeem the Senior Notes in whole or in part at any time and from time to time prior to their stated maturity at the redemption prices set forth in the Authorizing Resolution. In the event of a change of control repurchase event (as defined in the Indenture), the holders of the Senior Notes may require the Issuer to purchase for cash all or a portion of their Senior Notes at a purchase price equal to 101% of the principal amount of such Senior Notes, plus accrued and unpaid interest, if any, to, but not including, the date of repurchase. The Senior Notes are subject to certain customary covenants, including limitations on the ability of the Company and its subsidiaries, with exceptions, to incur debt secured by liens and to engage in sale and lease-back transactions.
Holders of the Senior Notes may not enforce the Indenture or the Senior Notes except as provided therein. In case an event of default (other than a default resulting from bankruptcy, insolvency or reorganization) shall occur and be continuing with respect to the Senior Notes, the Trustee or the holders of not less than 25% in aggregate principal amount of the Senior Notes then outstanding may declare the principal amount of the Senior Notes and interest, if any, accrued thereon to be due and payable immediately. If an event of default results from bankruptcy, insolvency or reorganization, all amounts due and payable on the Senior Notes will automatically become and be immediately due and payable. Any event of default with respect to the Senior Notes (except defaults in payment of principal of (or premium, if any, on) or interest, if any, on the Senior Notes or a default in respect of a covenant or provision that cannot be modified without the consent of the holder of each outstanding Senior Note) may be waived by the holders of at least a majority in aggregate principal amount of the Senior Notes outstanding.
The Company intends to use the net proceeds from the offering of the Senior Notes for general corporate purposes, which may include the repayment of indebtedness.
| Item 2.03 | Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement. |
The information provided in Item 1.01 of this report is incorporated by reference into this Item 2.03.
| Item 8.01 | Other Events. |
In connection with the offering of the Senior Notes, the Company is filing the legal opinions relating to the offering as Exhibit 5.1 and 5.2 to this report.
| Item 9.01 | Financial Statements and Exhibits. |
d) Exhibits
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Form of Global Note for the Issuer’s 3.800% Senior Notes due 2029. | |||
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| 23.1 |
Consent of Cravath, Swaine & Moore LLP (included as part of Exhibit 5.1). | |||
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Cover Page Interactive Data File (embedded within the Inline XBRL document) |
| * | Previously filed. |
Signature
Pursuant to the requirements of the Securities Exchange Act of 1934, the Company has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| TOLL BROTHERS, INC. | ||
| (Registrant) | ||
| By: |
/s/ Martin P. Connor | |
| Martin P. Connor | ||
| Senior Vice President, | ||
| Chief Financial Officer | ||
Date: September 12, 2019
Exhibit 1.1
Toll Brothers Finance Corp.
$400,000,000 3.800% Senior Notes due 2029
Guaranteed on a Senior Basis by Toll Brothers, Inc. and
Certain of Its Subsidiaries
Underwriting Agreement
September 9, 2019
BofA Securities, Inc.
Citigroup Global Markets Inc.
Goldman Sachs & Co. LLC
Mizuho Securities USA LLC
PNC Capital Markets LLC
SunTrust Robinson Humphrey, Inc.
Wells Fargo Securities LLC
As Representatives of the several Underwriters
c/o Mizuho Securities USA LLC
320 Park Avenue, 12th Floor
New York, NY 10022
Ladies and Gentlemen:
Toll Brothers Finance Corp., a corporation organized under the laws of Delaware (the “Issuer”), proposes, subject to the terms and conditions stated herein, to issue and sell to the several underwriters named in Annex A hereto (collectively, the “Underwriters”), for whom BofA Securities, Inc., Citigroup Global Markets Inc., Goldman Sachs & Co. LLC, Mizuho Securities USA LLC, PNC Capital Markets LLC, SunTrust Robinson Humphrey, Inc. and Wells Fargo Securities LLC (collectively, “you” or the “Representatives”) are acting as representatives, $400,000,000 aggregate principal amount of its 3.800% Senior Notes due 2029 (the “Notes”). The Notes are to be issued under the indenture dated as of February 7, 2012 (the “Base Indenture” and as amended and supplemented (including, without limitation, the separate authorizing resolutions of the Issuer and the Guarantors setting forth certain terms of the Notes (the “Authorizing Resolutions”), the “Indenture”) among the Issuer, the guarantors party thereto (individually, a “Guarantor” and, collectively, the “Guarantors”), including Toll Brothers, Inc. (the “Company”), and The Bank of New York Mellon, as trustee (the “Trustee”). The Notes will be fully and unconditionally guaranteed (the “Guarantees” and, together with the Notes, the “Securities”) by the Guarantors. Certain terms used herein are defined in Section 18 hereof.
The Issuer and the Guarantors have prepared and filed with the Commission under the Securities Act a registration statement on Form S-3 (File No. 333-222996), including a prospectus (the “Base Prospectus”), relating to, among other things, debt securities to be issued from time to time by the Issuer. The Company has also filed, or proposes to file, with the Commission pursuant to Rule 424 under the Securities Act a prospectus supplement specifically relating to the Securities (the “Prospectus Supplement”). The registration statement, as amended at the time it became effective, including the information, if any, deemed pursuant to Rule 430A, 430B or 430C under the Securities Act to be part of the registration statement at the time of its effectiveness (“Rule 430 Information”), is referred to herein as the “Registration Statement”; and as used herein, the term “Prospectus” means the Base Prospectus as supplemented by the Prospectus Supplement specifically relating to the Securities in the form first used (or made available upon request of purchasers pursuant to Rule 173 under the Securities Act) in
connection with confirmation of sales of the Securities and the term “Preliminary Prospectus” means the preliminary Prospectus Supplement specifically relating to the Securities together with the Base Prospectus. If the Company has filed an abbreviated registration statement pursuant to Rule 462(b) under the Securities Act (the “Rule 462 Registration Statement”), then any reference herein to the term “Registration Statement” shall be deemed to include such Rule 462 Registration Statement. Any reference in this Agreement to the Registration Statement, any Preliminary Prospectus or the Prospectus shall be deemed to refer to and include the documents incorporated by reference therein pursuant to Item 12 of Form S-3 under the Securities Act, as of the effective date of the Registration Statement or the date of such Preliminary Prospectus or the Prospectus, as the case may be and any reference to “amend”, “amendment” or “supplement” with respect to the Registration Statement, any Preliminary Prospectus or the Prospectus shall be deemed to refer to and include any documents filed after such date under the Exchange Act that are deemed to be incorporated by reference therein. Capitalized terms used but not defined herein shall have the meanings given to such terms in the Registration Statement and the Prospectus.
At or prior to the time when sales of the Securities were first made (the “Time of Sale”), the Issuer and the Guarantors had prepared the following information (collectively, the “Time of Sale Information”): (i) a Preliminary Prospectus dated September 9, 2019 and (ii) each “free-writing prospectus” (as defined pursuant to Rule 405 under the Securities Act) listed on Annex B hereto.
1. Representations and Warranties. Each of the Issuer and the Company represents and warrants to the Underwriters as set forth below in this Section 1.
(a) Registration Statement, Issuer Free Writing Prospectus and Time of Sale Information.
(i) The Company meets the requirements for use of Form S-3 under the Securities Act and has prepared and filed with the Commission an automatic shelf registration statement, as defined in Rule 405 on Form S-3, including a related Base Prospectus, for registration under the Securities Act of the offering and sale of the Securities. Such Registration Statement, including any amendments thereto filed prior to the Time of Sale, became effective upon filing. The Issuer and the Company may have filed with the Commission, as part of an amendment to the Registration Statement or pursuant to Rule 424(b), one or more preliminary prospectus supplements relating to the Securities, each of which has previously been furnished to you. The Issuer and the Company will file with the Commission a final prospectus supplement relating to the Securities in accordance with Rule 424(b). As filed, such final prospectus supplement shall comply in all material respects with the information requirements of the Securities Act and the rules thereunder, and, except to the extent each Representative shall agree in writing to a modification, shall be in all substantive respects in the form furnished to you prior to the Time of Sale or, to the extent not completed at the Time of Sale, shall contain only such specific additional information and other changes (beyond that contained in the Base Prospectus and any Time of Sale Information) as each of the Issuer and the Company has advised you, prior to the Time of Sale, will be included or made therein. The Registration Statement, at the Time of Sale, meets the requirements set forth in Rule 415(a)(1)(x).
(ii) The Registration Statement is an “automatic shelf registration statement” as defined in Rule 405 under the Securities Act that has been filed with the Commission not earlier than three years prior to the date hereof; and no notice of objection of the Commission to the use of such registration statement or any post-effective amendment thereto pursuant to Rule 401(g)(2) under the Securities Act has been received by the Company, and the Securities, since their registration pursuant to the Registration Statement, have been and remain eligible for registration
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by the Company on a Rule 405 “automatic shelf registration statement.” No stop order suspending the effectiveness of the Registration Statement is in effect; neither the Issuer nor the Company has been notified that any proceeding for that purpose has been instituted by the Commission or by the state securities authority of any jurisdiction and, to the knowledge of the Issuer or the Company, no such proceeding has been threatened. On each Effective Date, the Registration Statement did, and when the Prospectus is first filed in accordance with Rule 424(b) and on the Closing Date (as defined herein), the Prospectus (and any supplement thereto) will, comply in all material respects with the applicable requirements of the Securities Act, the Exchange Act and the Trust Indenture Act and the respective rules thereunder; on each Effective Date and at the Time of Sale, the Registration Statement did not and will not contain any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary in order to make the statements therein not misleading; on the Closing Date the Indenture will comply in all material respects with the applicable requirements of the Trust Indenture Act and the rules thereunder; and on the date of any filing pursuant to Rule 424(b) and on the Closing Date, the Prospectus (together with any supplement thereto) will not include any untrue statement of a material fact or omit to state a material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading; provided, however, that the Company makes no representations or warranties as to (i) that part of the Registration Statement which shall constitute the Statement of Eligibility and Qualification (Form T-1) under the Trust Indenture Act of the Trustee or (ii) the information contained in or omitted from the Registration Statement or the Prospectus (or any supplement thereto) in reliance upon and in conformity with information furnished in writing to the Issuer or the Company by or on behalf of any Underwriter through the Representatives specifically for inclusion in the Registration Statement or the Prospectus (or any supplement thereto), it being understood and agreed that the only such information furnished by or on behalf of any Underwriter consists of the information described as such in Section 6 hereof.
(iii) (a) The Time of Sale Information and (b) each electronic road show, if any, when taken together as a whole with the Time of Sale Information, at the Time of Sale did not, and at the Closing Date will not, contain any untrue statement of a material fact or omit to state a material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading; provided that the Issuer and the Company make no representation and warranty with respect to any statements or omissions made in reliance upon and in conformity with information relating to the Underwriters furnished to the Issuer or the Company in writing by the Underwriters expressly for use in such Time of Sale Information.
(iv) Each Issuer Free Writing Prospectus and the final term sheet prepared and filed pursuant to Section 3(b) hereto does not include any information that conflicts with the information contained in the Registration Statement, including any document incorporated therein by reference and any prospectus supplement deemed to be a part thereof that has not been superseded or modified. The foregoing sentence does not apply to statements in or omissions from any Issuer Free Writing Prospectus based upon and in conformity with written information furnished to the Issuer or the Company by any Underwriter through the Representatives specifically for use therein, it being understood and agreed that the only such information furnished by or on behalf of any Underwriter consists of the information described as such in Section 6 hereof.
(b) Well-Known Seasoned Issuer. The Company is a “well-known seasoned issuer” and is not an “ineligible issuer” in connection with the offering of the Securities, in each case as defined in Rule 405 under the Securities Act and at the times specified in the Securities Act in connection with the offering of the Securities. The Issuer and the Company have paid the
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registration fee for this offering or will pay such fee within the time period required pursuant to Rule 456(b)(1) under the Securities Act prior to the Closing Date, without giving effect to the proviso in Rule 456(b)(1)(i).
(c) Incorporated Documents. The documents incorporated by reference in the Registration Statement, the Prospectus and the Time of Sale Information, when they became effective or were filed with the Commission, as the case may be, except to the extent otherwise superseded by a subsequently filed document with the Commission, conformed, and any documents so filed and incorporated by reference after the date of this Agreement and on or prior to the Closing Date will conform, when they are filed with the Commission, in all material respects to the requirements of the Exchange Act and none of such documents contained any untrue statement of a material fact or omitted to state a material fact required to be stated therein or necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading.
(d) No Material Adverse Change. Since the respective dates as of which information is given in the Registration Statement, the Time of Sale Information and the Prospectus, except as otherwise specifically stated therein, (a) there has been no material adverse change in the condition (financial or otherwise), earnings, business affairs or business prospects of the Company and its subsidiaries considered as one enterprise, whether or not arising in the ordinary course of business (a “Material Adverse Change”), and (b) there has not been any change in the capital stock (other than as a result of the exercise of stock options) or long-term debt (other than as a result of payments on purchase money mortgages) of the Company or any of its subsidiaries, and there has been no dividend or distribution of any kind declared, paid or made by the Company on any class of its capital stock.
(e) Exchange Act Reporting. The Company is subject to and in full compliance with the reporting requirements of Section 13 or Section 15(d) of the Exchange Act.
(f) No Stabilization. None of the Issuer, the Guarantors or their respective affiliates has taken, directly or indirectly, any action designed to cause or which has constituted or which might reasonably be expected to cause or result, under the Exchange Act or otherwise, in the stabilization or manipulation of the price of any security of the Issuer or the Company to facilitate the sale or resale of the Securities.
(g) Organization and Good Standing. Each of the Company and its subsidiaries has been duly incorporated (if a corporation) or formed (if a partnership, limited liability company or trust) and is validly existing as a corporation, partnership, limited liability company or trust, as the case may be, in good standing (if applicable) under the laws of its jurisdiction of incorporation or formation, as the case may be (except where the failure to be in good standing would not result, individually or in the aggregate, in a Material Adverse Change), with full corporate or other organizational power and authority to own or lease, as the case may be (except where the failure to have full corporate or other organizational power and authority to own or lease, as the case may be, would not result, individually or in the aggregate, in a Material Adverse Change), and to operate its properties and conduct its business as described in the Registration Statement, the Time of Sale Information and the Prospectus, and is duly qualified to do business as a foreign corporation, partnership, limited liability company or trust, as the case may be, under the laws of each jurisdiction that requires such qualification (except where the failure to so qualify would not result, individually or in the aggregate, in a Material Adverse Change).
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(h) Capitalization. The Company has an authorized capitalization as set forth in the Time of Sale Information and the Prospectus under the heading “Capitalization,” all the outstanding shares of capital stock or outstanding interests of the Company and each of its subsidiaries have been duly and validly authorized and issued and are fully paid and nonassessable and, except as otherwise set forth in the Registration Statement, the Time of Sale Information and the Prospectus, all outstanding shares of capital stock or outstanding interests of such subsidiaries are owned by the Company either directly or through wholly owned subsidiaries free and clear of any perfected security interest or any other security interests, claims, liens or encumbrances.
(i) Authorization of Transaction Documents. This Agreement has been duly authorized, executed and delivered by the Issuer and the Company; the Indenture has been duly authorized by the Issuer and the Guarantors; the Base Indenture (assuming due authorization, execution and delivery thereof by the Trustee) has been duly executed and delivered by the Issuer and the Guarantors and when the Authorizing Resolutions are duly executed and delivered by the Issuer and the Guarantors, the Indenture will constitute a legal, valid and binding instrument, enforceable against the Issuer and the Guarantors in accordance with its terms (except that (a) the enforceability thereof may be subject to applicable bankruptcy, reorganization, insolvency, moratorium or other laws affecting creditors’ rights generally from time to time in effect and to general principles of equity, (b) the enforceability of provisions imposing liquidated damages, penalties or an increase in interest rate upon the occurrence of certain events may be limited in certain circumstances, (c) provisions specifying that provisions of documents may be amended or waived only in writing may not be enforced and (d) any rights to indemnity and contribution may be limited by applicable law or public policy considerations with respect thereto; such clauses (a), (b), (c) and (d) collectively being referred to as “Enforceability Limitations”); and on or prior to the Closing Date, the Notes and Guarantees will have been duly authorized and executed by the Issuer and the Guarantors, respectively, in accordance with the provisions of the Indenture (assuming due authorization, authentication and delivery by the Trustee) and on the Closing Date, the Notes will be delivered through the facilities of The Depository Trust Company to (subject to prior payment therefor by) the Underwriters under this Agreement and when so issued will constitute the legal, valid and binding obligations of the Issuer and the Guarantors, enforceable against the Issuer and the Guarantors (subject to the Enforceability Limitations) and entitled to the benefits of the Indenture.
(j) Description of the Securities. The statements made in each of the Time of Sale Information and the Prospectus under the caption “Description of the Notes”, insofar as they purport to constitute summaries of certain terms of documents referred to therein, constitute accurate summaries of the terms of such documents in all material respects.
(k) No Consents. Each of the Issuer and each Guarantor has all requisite corporate or other organizational power and authority and has taken all requisite corporate or other organizational action, to enter into and perform this Agreement, the Indenture and the Securities, to the extent it is a party thereto, and no consent, authorization, approval or order of or filing with any court or governmental agency or body is required for the performance by the Issuer or any of the Guarantors of its obligations under this Agreement, the Indenture or the Securities, except such as will be obtained under the Securities Act and the Trust Indenture Act and such as may be required under the blue sky or securities laws of any jurisdiction in connection with the purchase and distribution of the Securities by the Underwriters in the manner contemplated in this Agreement, the Registration Statement, the Time of Sale Information and the Prospectus.
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(l) No Violations. None of the execution and delivery of the Indenture or this Agreement, the issue and sale of the Securities, or the consummation of any of the other transactions herein or therein contemplated, nor the fulfillment of the terms hereof or thereof, will conflict with, result in a breach or violation of, or impose any lien, charge or encumbrance upon any property or assets of the Company or any of its subsidiaries pursuant to, (i) the charter, by-laws or other similar organizational document of the Company or any of its subsidiaries; (ii) the terms of any indenture, contract, lease, mortgage, deed of trust, note agreement, loan agreement or other agreement, obligation, condition, covenant or instrument to which the Company or any of its subsidiaries is a party or bound or to which its or their property is subject; or (iii) any statute, law, rule, regulation, judgment, order or decree applicable to the Company or any of its subsidiaries of any court, regulatory body, administrative agency, governmental body, arbitrator or other authority having jurisdiction over the Company or any of its subsidiaries or any of its respective properties (except in the cases of clauses (ii) and (iii) for such conflicts, breaches, violations, defaults, liens, charges or encumbrances that would not result, individually or in the aggregate, in a Material Adverse Change).
(m) Financial Statements and Information. The consolidated historical financial statements and schedules of the Company and its consolidated and consolidating subsidiaries incorporated by reference in the Registration Statement, the Time of Sale Information and the Prospectus present fairly in all material respects the financial condition, results of operations and cash flows of the Company as of the dates and for the periods indicated, comply in all material respects as to form with the applicable accounting requirements of the Securities Act and have been prepared in conformity with generally accepted accounting principles applied on a consistent basis throughout the periods involved (except as otherwise noted therein).
(n) Legal Proceedings. No action, suit or proceeding by or before any court or governmental agency, authority or body or any arbitrator involving the Company or any of its subsidiaries or its or their property is, to the best knowledge of the Issuer and the Company, pending or threatened that (i) could reasonably be expected to have a material adverse effect on the performance of this Agreement or the Indenture, or the consummation of any of the transactions contemplated hereby or thereby; or (ii) could reasonably be expected to result, individually or in the aggregate, in a Material Adverse Change, except as set forth, incorporated by reference in or contemplated in the Registration Statement, the Time of Sale Information and the Prospectus (exclusive of any amendment or supplement thereto).
(o) Real and Personal Property. Each of the Company and its subsidiaries owns or leases all such properties as are necessary to the conduct of its operations as presently conducted.
(p) No Violation. Neither the Company nor any subsidiary is in violation or default of (i) any provision of its charter, by-laws or other similar organizational document; (ii) the terms of any indenture, contract, lease, mortgage, deed of trust, note agreement, loan agreement or other agreement, obligation, condition, covenant or instrument to which it is a party or bound or to which its property is subject; or (iii) any statute, law, rule, regulation, judgment, order or decree applicable to the Company or any of its subsidiaries of any court, regulatory body, administrative agency, governmental body, arbitrator or other authority having jurisdiction over the Company or such subsidiary or any of its properties, as applicable (except in the cases of clauses (ii) and (iii) for such violations or defaults that would not result, individually or in the aggregate, in a Material Adverse Change).
(q) Independent Registered Public Accounting Firm. Ernst & Young LLP, who have certified certain financial statements of the Company and its consolidated subsidiaries and
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delivered their report with respect to the audited consolidated financial statements and schedules contained in or incorporated by reference in the Registration Statement, the Time of Sale Information and the Prospectus, is the independent registered public accounting firm with respect to the Company within the meaning of the Securities Act and the applicable published rules and regulations thereunder.
(r) Taxes. Each of the Company and its subsidiaries has filed all foreign, federal, state and local tax returns that are required to be filed or has requested extensions thereof (except in any case in which the failure so to file would not result, individually or in the aggregate, in a Material Adverse Change), whether or not arising from transactions in the ordinary course of business, except as set forth in or contemplated in the Registration Statement, the Time of Sale Information and the Prospectus (exclusive of any amendment or supplement thereto) and has paid all taxes required to be paid by it and any other assessment, fine or penalty levied against it, to the extent that any of the foregoing is due and payable, except for any such assessment, fine or penalty that is currently being contested in good faith or as would not result, individually or in the aggregate, in a Material Adverse Change, whether or not arising from transactions in the ordinary course of business, except as set forth in or contemplated in the Registration Statement, the Time of Sale Information and the Prospectus (exclusive of any amendment or supplement thereto).
(s) No Labor Disputes. No labor problem or dispute with the employees of the Company or any of its subsidiaries exists or, to the best knowledge of the Issuer and the Company, is threatened or imminent, and neither the Issuer nor the Company is aware of any existing or imminent labor disturbance by the employees of any of its or its subsidiaries’ principal suppliers, contractors or customers, which problem, dispute or labor disturbance could result, individually or in the aggregate, in a Material Adverse Change, whether or not arising from transactions in the ordinary course of business, except as set forth in or contemplated in the Registration Statement, the Time of Sale Information and the Prospectus (exclusive of any amendment or supplement thereto).
(t) Investment Company. Neither the Issuer nor the Company is, and after giving effect to the offering and sale of the Securities and the application of the proceeds thereof as described in the Registration Statement, the Time of Sale Information and the Prospectus neither will be, an “investment company” as defined in the Investment Company Act, without taking account of any exemption arising out of the number of holders of the Issuer or the Company’s securities.
(u) Insurance. The Company and each of its subsidiaries are insured by insurers of recognized financial responsibility against such losses and risks and in such amounts as are prudent and customary in the businesses in which they are engaged; all policies of insurance and fidelity or surety bonds insuring the Company or any of its subsidiaries or their respective businesses, assets, employees, officers and directors are in full force and effect; the Company and its subsidiaries are in compliance with the terms of such policies and instruments in all material respects; and there are no claims by the Company or any of its subsidiaries under any such policy or instrument as to which any insurance company is denying liability or defending under a reservation of rights clause, which denials or defenses if resolved adversely to the Company would result, individually or in the aggregate, in a Material Adverse Change; neither the Company nor any such subsidiary has (i) been refused any insurance coverage sought or applied for or (ii) any reason to believe that it will not be able to renew its existing insurance coverage as and when such coverage expires, except that, in either (i) or (ii), the Company and any such subsidiary believe that if any such coverage is refused, they will be able to obtain similar coverage from similar insurers as may be necessary to continue its business at a cost that would
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not result, individually or in the aggregate, in a Material Adverse Change, whether or not arising from transactions in the ordinary course of business, except as set forth in or contemplated in the Registration Statement, the Time of Sale Information and the Prospectus (exclusive of any amendment or supplement thereto).
(v) No Restrictions on Subsidiaries. Except for minimum capital requirements of law or contract, no Guarantor is currently prohibited, directly or indirectly, from paying any dividends to the Company, from making any other distribution on such subsidiary’s capital stock, from repaying to the Company any loans or advances to such subsidiary from the Company or from transferring any of such Guarantor’s property or assets to the Company or any other Guarantor, except as described in or contemplated by the Registration Statement, the Time of Sale Information and the Prospectus (exclusive of any amendment or supplement thereto).
(w) Licenses and Permits. The Company and its subsidiaries possess all licenses, certificates, permits and other authorizations issued by the appropriate federal, state or foreign regulatory authorities necessary to conduct their respective businesses (except where the failure to possess such licenses, certificates, permits or other authorizations would not result, individually or in the aggregate, in a Material Adverse Change) and neither the Company nor any such subsidiary has received any notice of proceedings relating to the revocation or modification of any such certificate, authorization or permit which, if the subject of an unfavorable decision, ruling or finding, would result, individually or in the aggregate, in a Material Adverse Change, whether or not arising from transactions in the ordinary course of business, except as set forth in or contemplated in the Registration Statement, the Time of Sale Information and the Prospectus (exclusive of any amendment or supplement thereto).
(x) Accounting Controls. The Company maintains a system of internal accounting controls sufficient to provide reasonable assurance that, in reference to the Company and its subsidiaries on a consolidated basis, (i) transactions are executed in accordance with management’s general or specific authorization; (ii) transactions are recorded as necessary to permit preparation of financial statements in conformity with generally accepted accounting principles and to maintain asset accountability; (iii) access to assets is permitted only in accordance with management’s general or specific authorization; and (iv) the recorded accountability for assets is compared with the existing assets at reasonable intervals and appropriate action is taken with respect to any differences.
(y) Sarbanes-Oxley Act. There is and has been no failure on the part of the Company and any of the Company’s directors or officers, in their capacities as such, to comply in all material respects with any provision of the Sarbanes-Oxley Act of 2002 and the rules and regulations promulgated in connection therewith, including Section 402 related to loans and Sections 302 and 906 related to certifications.
(z) Disclosure Controls. The Company has established and maintains disclosure controls and procedures (as such term is defined in Rules 13a-15 and 15d-14 under the Exchange Act); such disclosure controls and procedures are designed to ensure that material information relating to the Company and its subsidiaries is made known to the chief executive officer and chief financial officer of the Company by others within the Company or any subsidiary, and such disclosure controls and procedures are reasonably effective to perform the functions for which they were established subject to the limitations of any such control system; the Company’s auditors and the audit committee of the board of directors of the Company have been advised of: (A) any significant deficiencies in the design or operation of internal controls which are reasonably likely to adversely affect the Company’s ability to record, process, summarize, and
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report financial data; and (B) any fraud, whether or not material, that involves management or other employees who have a significant role in the Company’s internal controls; and since the date of the most recent evaluation of such disclosure controls and procedures, there have been no significant changes in internal controls or in other factors that are reasonably likely to materially affect internal controls, including any corrective actions with regard to significant deficiencies and material weaknesses.
Any certificate signed by any officer of the Issuer or the Guarantors and delivered to the Underwriters or counsel for the Underwriters in connection with the offering of the Securities shall be deemed a representation and warranty by the Issuer and the Guarantors, as to matters covered thereby, to the Underwriters.
2. Purchase and Sale.
(a) Subject to the terms and conditions and in reliance upon the representations and warranties herein set forth, the Issuer agrees to sell to the several Underwriters, and each of the Underwriters severally and not jointly agrees to purchase from the Issuer, at a purchase price of 99.350% of the principal amount thereof, plus accrued interest, if any, from September 12, 2019, to the Closing Date, the entire aggregate principal amount of the Notes set forth opposite such Underwriter’s name on Annex A hereto, which shall be endorsed with the Guarantees.
(b) Delivery of and payment for the Securities shall be made at 10:00 A.M., New York City time, on September 12, 2019 at the offices of Cahill Gordon & Reindel LLP, or at such time on such later date (not more than three Business Days after the foregoing date) or such other place as the Representatives shall designate, which date and time may be postponed by agreement between the Representatives and the Issuer and the Company (such date and time of delivery and payment for the Securities being herein called the “Closing Date”). Delivery of the Securities shall be made to the Representatives for the accounts of the several Underwriters against payment of the purchase price thereof to or upon the order of the Issuer and the Company by wire transfer payable in same-day funds to the account specified by the Issuer and the Company. Delivery of the Securities shall be made through the facilities of The Depository Trust Company unless the Representatives shall otherwise instruct.
It is understood and agreed that the several Underwriters propose to offer the Securities to the public as set forth in the Time of Sale Information.
(c) Each of the Issuer and the Guarantors hereby acknowledges that (a) the purchase and sale of the Securities pursuant to this Agreement is an arm’s-length commercial transaction between the Issuer and Guarantors, on the one hand, and the Underwriters and any affiliate through which it may be acting, on the other, (b) the Underwriters are acting as principal and not as an agent or fiduciary of the Company and (c) the Issuer and Guarantors’ engagement of the Underwriters in connection with the offering and the process leading up to the offering is as independent contractors and not in any other capacity. Furthermore, each of the Issuer and Guarantors agrees that it is solely responsible for making its own judgments in connection with the offering (irrespective of whether the Underwriters have advised or is currently advising the Issuer or Guarantors on related or other matters). Each of the Issuer and Guarantors agrees that it will not claim that the Underwriters have rendered advisory services of any nature or respect, or owe an agency, fiduciary or similar duty to the Issuer and Guarantors, in connection with such transaction or the process leading thereto.
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3. Agreements. Each of the Issuer and the Company agrees with the Underwriters that:
(a) Prior to the termination of the offering of the Securities, the Issuer and the Company will not file any amendment to the Registration Statement or supplement (including the Prospectus or any Time of Sale Information) to the Base Prospectus unless the Issuer and the Company have furnished to you a copy for your review prior to filing and will not file any such proposed amendment or supplement to which you reasonably object. The Issuer and the Company will cause the Prospectus, properly completed, and any supplement thereto to be filed in a form approved by the Representatives with the Commission pursuant to the applicable paragraph of Rule 424(b) within the time period prescribed and will provide evidence satisfactory to the Representatives of such timely filing. The Issuer and the Company will promptly advise the Representatives (i) when the Prospectus, and any supplement thereto, shall have been filed (if required) with the Commission pursuant to Rule 424(b), (ii) when, prior to termination of the offering of the Securities, any amendment to the Registration Statement shall have been filed or become effective, (iii) of any request by the Commission or its staff for any amendment of the Registration Statement, or any Rule 462(b) Registration Statement, or for any supplement to the Prospectus or for any additional information, (iv) of the issuance by the Commission of any stop order suspending the effectiveness of the Registration Statement or of any notice objecting to its use or the institution or threatening of any proceeding for that purpose and (v) of the receipt by the Issuer or the Company of any notification with respect to the suspension of the qualification of the Securities for sale in any jurisdiction or the institution or threatening of any proceeding for such purpose. The Issuer and the Company will use their best efforts to prevent the issuance of any such stop order or the occurrence of any such suspension or objection to the use of the Registration Statement and, upon such issuance, occurrence or notice of objection, to obtain as soon as possible the withdrawal of such stop order or relief from such occurrence or objection, including, if necessary, by filing an amendment to the Registration Statement or a new registration statement and using its best efforts to have such amendment or new registration statement declared effective as soon as practicable.
(b) To prepare a final term sheet, containing a description of final terms of the Securities and the offering thereof, in form and substance approved by you and attached as Annex C hereto and to file such term sheet pursuant to Rule 433(d) within the time required by such Rule.
(c) If, at any time prior to the filing of the Prospectus pursuant to Rule 424(b), any event occurs as a result of which the Time of Sale Information would include any untrue statement of a material fact or omit to state any material fact necessary to make the statements therein in the light of the circumstances under which they were made not misleading, the Issuer and the Company will (i) notify promptly the Representatives so that any use of the Time of Sale Information may cease until it is amended or supplemented; (ii) amend or supplement the Time of Sale Information to correct such statement or omission; and (iii) supply any amendment or supplement to you in such quantities as you may reasonably request.
(d) [Reserved].
(e) [Reserved].
(f) The Issuer and the Company will furnish to the Representatives and counsel for the Underwriters, without charge, signed or conformed copies of the Registration Statement (including exhibits thereto) and to each other Underwriter a copy of the Registration Statement (without exhibits thereto) and, so long as delivery of a prospectus by an Underwriter or dealer may be required by the Securities Act (including in circumstances where such requirement may be satisfied pursuant to Rule 172), as many copies of each the Time of Sale Information, the
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Prospectus and each Issuer Free Writing Prospectus and any supplement thereto as the Representatives may reasonably request. The Issuer and the Company will pay the expenses of printing or other production of all documents relating to the offering.
(g) [Reserved].
(h) Each of the Issuer and the Company agrees that, unless it has or shall have obtained the prior written consent of the Representatives, and each Underwriter, severally and not jointly, agrees with the Issuer and the Company that, unless it has or shall have obtained, as the case may be, the prior written consent of the Issuer and the Company, it has not made and will not make any offer relating to the Securities that would constitute an Issuer Free Writing Prospectus or that would otherwise constitute a “free writing prospectus” (as defined in Rule 405) required to be filed by the Issuer and the Company with the Commission or retained by the Company under Rule 433, other than a free writing prospectus containing the information contained in the final term sheet prepared and filed pursuant to Section 3(b) hereto; provided that the prior written consent of the parties hereto shall be deemed to have been given in respect of the Issuer Free Writing Prospectus included in Annex B hereto and, if applicable, any electronic road show. Any such free writing prospectus consented to by the Representatives or the Issuer and the Company is hereinafter referred to as a “Permitted Free Writing Prospectus.” Each of the Issuer and the Company agrees that (x) it has treated and will treat, as the case may be, each Permitted Free Writing Prospectus as an Issuer Free Writing Prospectus and (y) it has complied and will comply, as the case may be, with the requirements of Rules 164 and 433 applicable to any Permitted Free Writing Prospectus, including in respect of timely filing with the Commission, legending and record keeping, as applicable.
(i) The Issuer and the Guarantors will use their best efforts, in cooperation with the Underwriters, to arrange, if necessary, for the qualification of the Securities for sale by the Underwriters under the laws of such jurisdictions as the Underwriters may designate and will maintain such qualifications in effect so long as required for the distribution of the Securities; provided that in no event shall the Issuer and the Guarantors be obligated to qualify to do business in any jurisdiction where they are not now so qualified or to take any action that would subject them to service of process in suits, other than those arising out of the offering or sale of the Securities, in any jurisdiction where they are not now so subject. The Issuer and the Company will promptly advise the Representatives of the receipt by the Issuer or any of the Guarantors of any notification with respect to the suspension of the qualification of the Securities for sale in any jurisdiction or the initiation or threatening of any proceeding for such purpose.
(j) (1) If during the Prospectus Delivery Period (i) any event shall occur or condition shall exist as a result of which the Prospectus as then amended or supplemented would include any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary in order to make the statements therein, in the light of the circumstances existing when the Prospectus is delivered to a purchaser, not misleading or (ii) it is necessary to amend or supplement the Prospectus to comply with law, the Issuer and the Company will immediately notify the Underwriters thereof and forthwith prepare and, subject to paragraph (a) of this Section 3, file with the Commission and furnish to the Underwriters and to such dealers as the Representatives may designate, such amendments or supplements to the Prospectus as may be necessary so that the statements in the Prospectus as so amended or supplemented will not, in the light of the circumstances existing when the Prospectus is delivered to a purchaser, be misleading or so that the Prospectus will comply with law and (2) if at any time prior to the Closing Date (i) any event shall occur or condition shall exist as a result of which the Time of Sale Information as then amended or supplemented would include any untrue statement of a material fact or omit to
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state any material fact necessary in order to make the statements therein, in the light of the circumstances, not misleading or (ii) it is necessary to amend or supplement the Time of Sale Information to comply with law, the Issuer and the Company will immediately notify the Underwriters thereof and forthwith prepare and, subject to paragraph (a) of this Section 3, file with the Commission (to the extent required) and furnish to the Underwriters and to such dealers as the Representatives may designate, such amendments or supplements to the Time of Sale Information as may be necessary so that the statements in the Time of Sale Information as so amended or supplemented will not, in the light of the circumstances, be misleading or so that the Time of Sale Information will comply with law.
(k) The Company and the Issuer will make generally available to its security holders and the Representatives as soon as practicable an earnings statement that satisfies the provisions of Section 11(a) of the Securities Act and Rule 158 of the Commission promulgated thereunder covering a period of at least twelve months beginning with the first fiscal quarter of the Company and the Issuer occurring after the “effective date” (as defined in Rule 158) of the Registration Statement.
(l) The Issuer will, pursuant to reasonable procedures developed in good faith, retain copies of each Issuer Free Writing Prospectus that is not filed with the Commission in accordance with Rule 433 under the Securities Act.
(m) The Issuer and the Guarantors will cooperate with the Representatives and use their best efforts to permit the Securities to be eligible for clearance and settlement through The Depository Trust Company.
(n) Neither the Issuer nor any of the Guarantors will for a period of ten business days following the date hereof, without the prior written consent of the Representatives, offer, sell or contract to sell, pledge or otherwise dispose of (or enter into any transaction which is designed to, or might reasonably be expected to, result in the disposition of (whether by actual disposition or effective economic disposition due to cash settlement or otherwise) by the Issuer or the Guarantors or any of their respective controlled affiliates or any person in privity with the Issuer or the Guarantors or any of their respective controlled affiliates), directly or indirectly, or announce the offering of, any debt securities issued or guaranteed by the Issuer or the Guarantors (other than the Securities). Notwithstanding anything in this Section 3(n) to the contrary, and for the avoidance of doubt, the Company directly or indirectly through a subsidiary, may (i) make borrowings under the Revolving Bank Credit Facility (as defined in the Indenture) pursuant to the terms and conditions of such agreement, (ii) enter into purchase money mortgage transactions, (iii) obtain letters of credit and (iv) enter into such other commercial lending transactions consistent with the Company’s business.
(o) The Issuer and the Guarantors will not take, directly or indirectly, any action designed to or which has constituted or which might reasonably be expected to cause or result, under the Exchange Act or otherwise, in stabilization or manipulation of the price of any security of the Issuer or the Guarantors to facilitate the sale or resale of the Securities.
(p) The Issuer and the Company agree to pay all expenses incident to the performance of their obligations under this Agreement, including (i) the costs of the preparation and printing of the Registration Statement, any Issuer Free Writing Prospectus, each Preliminary Prospectus, the Time of Sale Information and the Prospectus and each amendment or supplement thereto, (ii) the costs of printing and distributing to the Underwriters and any selected dealers the Registration Statement, any Issuer Free Writing Prospectus, each Preliminary Prospectus, the
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Time of Sale Information and the Prospectus, and all amendments or supplements thereto, as provided in this Agreement, (iii) the costs of typing, printing and reproducing this Agreement and the Indenture, (iv) the fees paid to rating agencies in connection with the rating of the Securities, (v) the fees and expenses of qualifying the Securities under the securities laws of the several jurisdictions as provided in Section 3(i) hereof and of preparing, printing, reproducing and distributing a Blue Sky Memorandum (including the reasonable fees and disbursements of counsel for the Underwriters in connection therewith), (vi) the fees and disbursements of the counsel and accountants for the Issuer and the Guarantors and (vii) the fees of the Trustee.
4. Conditions to the Obligations of the Underwriters. The obligations of the Underwriters to purchase the Securities shall be subject to the accuracy of the representations and warranties on the part of the Issuer and the Guarantors contained herein at the Time of Sale, the Closing Date and any settlement date, to the accuracy of the statements of the Issuer and the Guarantors made in any certificates pursuant to the provisions hereof, to the performance by the Issuer and the Guarantors of their respective obligations hereunder and to the following additional conditions:
(a) No order suspending the effectiveness of the Registration Statement shall be in effect, and no proceeding for such purpose, pursuant to Rule 401(g)(2) or pursuant to Section 8A under the Securities Act shall be pending before or, to the knowledge of the Issuer or any of the Guarantors, threatened by the Commission; the Prospectus and each Issuer Free Writing Prospectus shall have been timely filed with the Commission under the Securities Act (in the case of an Issuer Free Writing Prospectus, to the extent required by Rule 433 under the Securities Act) and in accordance with Section 3(a) hereof; and all requests by the Commission for additional information shall have been complied with to the reasonable satisfaction of the Representatives.
(b) The Issuer and the Company shall have requested and caused the General Counsel of the Company (or, at the Company’s option, one or more other counsel reasonably acceptable to the Representatives) to furnish to the Underwriters such counsel’s opinion, dated the Closing Date and addressed to the Underwriters, in form and substance reasonably satisfactory to the Representatives and counsel for the Underwriters.
(c) Cravath, Swaine & Moore LLP, counsel for the Issuer and the Company, shall have furnished to the Underwriters their opinion and a negative assurance letter, dated the Closing Date and addressed to the Underwriters, in form and substance reasonably acceptable to the Representatives.
(d) The Representatives shall have received from Cahill Gordon & Reindel LLP, counsel for the Underwriters, an opinion and a negative assurance letter, dated the Closing Date and addressed to the Underwriters, with respect to the issuance and sale of the Securities, the Indenture, the Registration Statement, the Time of Sale Information and the Prospectus (as amended or supplemented at the Closing Date) (it being understood that such counsel need not express any comment with respect to the financial statements or any other financial or statistical data that is included in or omitted from the Registration Statement, the Time of Sale Information and the Prospectus) and other related matters as the Representatives may reasonably require, and the Issuer and the Guarantors shall have furnished to such counsel such documents as they request for the purpose of enabling them to pass upon such matters.
(e) The Issuer and the Company shall have furnished to the Representatives a certificate of the Issuer and the Company, signed by the President or an Executive or Senior Vice President and the principal financial or accounting officer of each of the Issuer and the Company, dated the Closing Date, to the effect that the signers of such certificate have carefully examined
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the Registration Statement, the Time of Sale Information and the Prospectus, any amendments or supplements to the Registration Statement, the Time of Sale Information and the Prospectus and this Agreement and that:
(i) no order suspending the effectiveness of the Registration Statement is in effect, and no proceeding for such purpose, pursuant to Rule 401(g)(2) or pursuant to Section 8A under the Securities Act is pending before or, to their knowledge, threatened by the Commission;
(ii) the representations and warranties of the Issuer and the Guarantors in this Agreement are true and correct in all material respects (except that any representation and warranty that is qualified as to “materiality” or “Material Adverse Change” shall be true and correct in all respects) on and as of the Closing Date with the same effect as if made on the Closing Date, and each of the Issuer and the Guarantors has complied with all the agreements and satisfied all the conditions on its part to be performed or satisfied hereunder at or prior to the Closing Date; and
(iii) since the date of the most recent financial statements included in the Registration Statement, the Time of Sale Information and the Prospectus (exclusive of any amendment or supplement thereto), there has been no Material Adverse Change, except as set forth in or contemplated by the Registration Statement, the Time of Sale Information and the Prospectus (exclusive of any amendment or supplement thereto).
(f) On the date of this Agreement and on the Closing Date, the Company shall have requested and caused Ernst & Young LLP to furnish to the Representatives, “comfort letters,” dated the respective dates of delivery thereof, in form and substance satisfactory to the Representatives, confirming that they are an independent registered public accounting firm within the meaning of the Exchange Act and the applicable published rules and regulations thereunder and confirming certain matters with respect to the audited and unaudited financial statements and other financial and accounting information contained in or incorporated by reference in the Registration Statement, the Time of Sale Information and the Prospectus. References to the Registration Statement, the Time of Sale Information and the Prospectus in this Section 4(f) include any amendments or supplements thereto at the date of the applicable letter.
(g) Subsequent to the Time of Sale or, if earlier, the dates as of which information is given in the Registration Statement, the Time of Sale Information and the Prospectus (exclusive of any amendment or supplement thereto), there shall not have been (i) any change or decrease specified in the letter referred to in Section 4(f) hereof; or (ii) any Material Adverse Change, whether or not arising from transactions in the ordinary course of business, except as set forth in or contemplated in the Registration Statement, the Time of Sale Information and the Prospectus (exclusive of any amendment or supplement thereto), the effect of which, in any case referred to in clause (i) or (ii) above, is, in the sole judgment of the Representatives, so material and adverse as to make it impractical or inadvisable to market the Securities as contemplated by the Registration Statement, the Time of Sale Information and the Prospectus (exclusive of any amendment or supplement thereto).
(h) Subsequent to the Time of Sale, there shall not have been any decrease in the rating of any of the debt securities of the Issuer or any of the Guarantors by any “nationally recognized statistical rating organization” registered under Section 15(e) of the Exchange Act or any notice given of any intended or potential decrease in any such rating or of a possible change in any such rating that does not indicate the direction of the possible change.
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(i) Prior to the Closing Date, the Issuer and the Guarantors shall have furnished to the Representatives such further information, certificates and documents as the Representatives may reasonably request.
If any of the conditions specified in this Section 4 shall not have been fulfilled in all material respects when and as provided in this Agreement, or if any of the opinions, letters and certificates mentioned above or elsewhere in this Agreement shall not be in all material respects reasonably satisfactory in form and substance to the Representatives and counsel for the Underwriters, this Agreement and all obligations of the Underwriters hereunder may be canceled at, or at any time prior to, the Closing Date by the Representatives. Notice of such cancellation shall be given to the Issuer and the Company in writing or by telephone or facsimile confirmed in writing.
The documents required to be delivered by this Section 4 will be delivered at the office of Cahill Gordon & Reindel LLP, counsel for the Underwriters, at 80 Pine Street, New York, New York 10005, on the Closing Date.
5. Reimbursement of Expenses. If the sale of the Securities provided for herein is not consummated because any condition to the obligations of the Underwriters set forth in Section 4 hereof is not satisfied, because of any termination pursuant to Section 7 hereof or because of any refusal, inability or failure on the part of the Company to perform any agreement herein or comply with any provision hereof other than by reason of a default by the Underwriters, the Issuer and the Company will reimburse the Underwriters on demand for all reasonable out-of-pocket expenses (including reasonable fees and disbursements of counsel) that shall have been incurred by them in connection with the proposed purchase and sale of the Securities.
6. Indemnification and Contribution.
(a) Each of the Issuer and the Guarantors agrees to indemnify and hold harmless each of the Underwriters, the directors, officers, employees and agents of each of the Underwriters and each person who controls an Underwriter within the meaning of either the Securities Act or the Exchange Act against any and all losses, claims, damages or liabilities, joint or several, to which they or any of them may become subject under the Securities Act, the Exchange Act or other Federal or state statutory law or regulation, at common law or otherwise, insofar as such losses, claims, damages or liabilities (or actions in respect thereof) arise out of or are based upon any untrue statement or alleged untrue statement of a material fact contained in the Registration Statement, the Time of Sale Information (or any part thereof), the Prospectus or any electronic roadshow and any Issuer Free Writing Prospectus (or in any supplements or amendments thereto), or arise out of or are based upon the omission or alleged omission to state therein a material fact required to be stated therein or necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading, and agrees to reimburse each such indemnified party, as incurred, for any legal or other expenses reasonably incurred by them in connection with investigating or defending any such loss, claim, damage, liability or action; provided, however, that the Issuer and Guarantors will not be liable in any such case to the extent that any such loss, claim, damage or liability arises out of or is based upon any such untrue statement or alleged untrue statement or omission or alleged omission made in the Registration Statement, the Time of Sale Information or the Prospectus, or in any amendment thereof or supplement thereto, in reliance upon and in conformity with written information furnished to the Issuer or any of the Guarantors by or on behalf of any Underwriter through the Representatives specifically for inclusion therein. This indemnity agreement will be in addition to any liability which the Issuer and the Guarantors may otherwise have.
(b) The Underwriters severally and not jointly agree to indemnify and hold harmless each of the Issuer and the Guarantors, each of their directors, officers, general partners, managers and
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managing members, as the case may be, of each of the Issuer and the Guarantors and each person who controls the Issuer and the Guarantors within the meaning of either the Securities Act or the Exchange Act, to the same extent as the foregoing indemnity from the Issuer and the Guarantors to each Underwriter, but only with reference to written information relating to an Underwriter furnished to the Issuer and the Guarantors by or on behalf of such Underwriter through the Representatives specifically for inclusion in the Registration Statement, the Time of Sale Information or the Prospectus (or in any amendments or supplements thereto). This indemnity agreement will be in addition to any liability which any Underwriter may otherwise have. The Issuer and the Guarantors acknowledge that the statements set forth in the ninth paragraph (first and second sentences) and the tenth paragraph (fourth and fifth sentences) under the heading “Underwriting” in the Preliminary Prospectus and the Prospectus constitute the only information furnished in writing by the Underwriters for inclusion in the Registration Statement, the Time of Sale Information, the Prospectus, any electronic roadshow and any Issuer Free Writing Prospectus (or in any amendment or supplement thereto).
(c) Promptly after receipt by an indemnified party under this Section 6 of notice of the commencement of any action, such indemnified party will, if a claim in respect thereof is to be made against the indemnifying party under this Section 6, notify the indemnifying party in writing of the commencement thereof; but the failure so to notify the indemnifying party (i) will not relieve it from liability under paragraph (a) or (b) above unless and to the extent it did not otherwise learn of such action and such failure results in the forfeiture by the indemnifying party of substantial rights and defenses; and (ii) will not, in any event, relieve the indemnifying party from any obligations to any indemnified party other than the indemnification obligation provided in paragraph (a) or (b) above. The indemnifying party shall be entitled to appoint counsel of the indemnifying party’s choice at the indemnifying party’s expense to represent the indemnified party in any action for which indemnification is sought (in which case the indemnifying party shall not thereafter be responsible for the fees and expenses of any separate counsel retained by the indemnified party or parties); provided, however, that such counsel shall be reasonably satisfactory to the indemnified party. An indemnifying party may participate in its own expense in the defense of any action; provided, however, that counsel to the indemnifying party shall not (except with the consent of the indemnified party) also be counsel to the indemnified party. In no event shall the indemnifying parties be liable for the fees and expenses of more than one counsel (in addition to any local counsel) separate from their own counsel for all indemnified parties in connection with any one action or separate but similar or related actions in the same jurisdiction arising out of the same general allegations or circumstances. An indemnifying party will not, without the prior written consent of the indemnified parties, settle or compromise or consent to the entry of any judgment with respect to any pending or threatened claim, action, suit or proceeding in respect of which indemnification or contribution may be sought hereunder (whether or not the indemnified parties are actual or potential parties to such claim or action) unless (a) such settlement, compromise or consent includes an unconditional release of each indemnified party from all liability arising out of such claim, action, suit or proceeding and (b) such settlement does not include any statement as to or any admission of fault, culpability or a failure to act by or on behalf of any indemnified person.
(d) In the event that the indemnity provided in paragraph (a) or (b) of this Section 6 is unavailable to or insufficient to hold harmless an indemnified party for any reason, the Issuer and the Guarantors and the Underwriters agree to contribute to the aggregate losses, claims, damages and liabilities (including legal or other expenses reasonably incurred in connection with investigating or defending same) (collectively “Losses”) to which the Issuer or the Guarantors and the Underwriters may be subject in such proportion as is appropriate to reflect the relative benefits received by the Company on the one hand and by the Underwriters on the other from the offering of the Securities; provided, however, that in no case shall any Underwriters be responsible for any amount in excess of the purchase discount or commission applicable to the Securities purchased by such Underwriters hereunder. If the allocation provided by the immediately preceding sentence is unavailable for any reason, the Issuer and the
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Guarantors and the Underwriters shall contribute in such proportion as is appropriate to reflect not only such relative benefits but also the relative fault of the Issuer and the Guarantors on the one hand and of the Underwriters on the other in connection with the statements or omissions which resulted in such Losses, as well as any other relevant equitable considerations. Benefits received by the Issuer and the Guarantors shall be deemed to be equal to the total net proceeds from the offering (before deducting expenses) received by it, and benefits received by the Underwriters shall be deemed to be equal to the total purchase discounts and commissions in each case set forth on the cover of the Prospectus. Relative fault shall be determined by reference to, among other things, whether any untrue or any alleged untrue statement of a material fact or the omission or alleged omission to state a material fact relates to information provided by the Issuer and the Guarantors on the one hand or the Underwriters on the other, the intent of the parties and their relative knowledge, information and opportunity to correct or prevent such untrue statement or omission. The Issuer and the Guarantors and the Underwriters agree that it would not be just and equitable if contribution were determined by pro rata allocation or any other method of allocation which does not take account of the equitable considerations referred to above. Notwithstanding the provisions of this paragraph (d), no person guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the Securities Act) shall be entitled to contribution from any person who was not guilty of such fraudulent misrepresentation. For purposes of this Section 6, each person who controls the Underwriters within the meaning of either the Securities Act or the Exchange Act and each director, officer, employee and agent of the Underwriters shall have the same rights to contribution as the Underwriters, and each person who controls any of the Issuer and the Guarantors within the meaning of either the Securities Act or the Exchange Act and each officer, director, general partner, manager and managing member, as the case may be, of the Issuer and the Guarantors shall have the same rights to contribution as the Issuer and the Guarantors, subject in each case to the applicable terms and conditions of this paragraph (d).
7. Termination. This Agreement shall be subject to termination in the absolute discretion of the Representatives, by notice given to the Issuer and the Company prior to delivery of and payment for the Securities, if at any time prior to such time (i) trading in the Company’s Common Stock shall have been suspended by the Commission or the New York Stock Exchange or trading in securities generally on the New York Stock Exchange or the NASDAQ Global Select Market shall have been suspended or limited or minimum prices shall have been established on such exchanges; (ii) a banking moratorium shall have been declared either by Federal or New York State authorities; (iii) there shall have occurred any outbreak or escalation of hostilities, declaration by the United States of a national emergency or war, or other calamity or crisis the effect of which on financial markets is such as to make it, in the sole judgment of the Representatives, impracticable or inadvisable to proceed with the offering or delivery of the Securities as contemplated by this Agreement, the Time of Sale Information and the Prospectus (exclusive of any amendment or supplement thereto); or (iv) since the respective dates as of which information is given in the Registration Statement, the Time of Sale Information and the Prospectus, there has been a Material Adverse Change.
8. Representations and Indemnities to Survive. The respective agreements, representations, warranties, indemnities and other statements of the Issuer and the Guarantors or their respective officers and of the Underwriters set forth in or made pursuant to this Agreement will remain in full force and effect, regardless of any investigation made by the Underwriters or the Issuer and the Guarantors or any of the officers, directors, general partners, managers or managing members, as the case may be, or controlling persons referred to in Section 6 hereof, and will survive delivery of and payment for the Securities. Notwithstanding anything to the contrary contained herein, the provisions of Sections 5 and 6 hereof shall survive the termination or cancellation of this Agreement.
9. Notices. All communications hereunder will be in writing and effective only on receipt, and, if sent to BofA Securities, Inc., 50 Rockefeller Plaza, NY1-050-12-02, New York, New York
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10020 (facsimile: (646) 855-5958), Attention: High Grade Transaction Management/Legal; if sent to Citigroup Global Markets Inc., General Counsel (fax no: (646) 291-1469) and confirmed to the General Counsel, Citigroup Global Markets Inc., at 388 Greenwich Street, New York, New York 10013, Attention: General Counsel; if sent to Goldman Sachs & Co. LLC, 200 West Street, New York, New York 10282-2198, Attention: Registration Department; if sent to Mizuho Securities USA LLC, will be mailed, delivered or telefaxed to 320 Park Avenue – 12th Floor, New York, New York 10022, Attention: Debt Capital Markets (fax no.: (212) 205-7812); if sent to SunTrust Robinson Humphrey, Inc., will be mailed, delivered or telefaxed to 3333 Peachtree Road, 11th Floor, Atlanta, Georgia 30326, Attention: Investment Grade Debt Capital Market (fax no.: (404) 926-5129); if sent to PNC Capital Markets LLC, PT-PTWR-10-1 10th Floor, 300 Fifth Avenue, Pittsburgh, PA 15222, Attention: Group Head of Corporate Securities; if sent to Wells Fargo Securities, LLC at 550 South Tryon Street, 5th Floor, Charlotte, North Carolina 28202, Attention: Transaction Management, Email: tmgcapitalmarkets@wellsfargo.com; or if sent to the Issuer and the Company, will be mailed, delivered or telefaxed to Toll Brothers Finance Corp./Toll Brothers, Inc., Chief Executive Officer (fax no.: (215) 938-8255) and confirmed to 250 Gibraltar Road, Horsham, Pennsylvania 19044, Attention: Douglas C. Yearley, Jr., Chief Executive Officer, and confirmed to the General Counsel at the same address.
10. Successors. This Agreement is binding upon the parties hereto and their respective successors and will inure to the benefit of the officers, directors, general partners, managers and managing members, as the case may be, and controlling persons referred to in Section 6 hereof, and no other person will have any right or obligation hereunder.
11. Default by an Underwriter. If any one or more Underwriters shall fail to purchase and pay for any of the Securities agreed to be purchased by such Underwriter hereunder and such failure to purchase shall constitute a default in the performance of its or their obligations under this Agreement, the remaining Underwriters shall be obligated severally to take up and pay for (in the respective proportions which the amount of Securities set forth opposite their names in Annex A hereto bears to the aggregate amount of Securities set forth opposite the names of all the remaining Underwriters) the Securities which the defaulting Underwriter or Underwriters agreed but failed to purchase; provided, however, that in the event that the aggregate amount of Securities which the defaulting Underwriter or Underwriters agreed but failed to purchase shall exceed 10% of the aggregate amount of Securities set forth in Annex A hereto, the remaining Underwriters shall have the right to purchase all, but shall not be under any obligation to purchase any, of the Securities. In the event that the nondefaulting Underwriters are not obligated to take up and pay for the Securities of the defaulting Underwriter and do not arrange for the purchase of such Securities of a defaulting Underwriter or Underwriters, then the Issuer shall be entitled to a further period of 36 hours within which to procure other persons satisfactory to the nondefaulting Underwriters to purchase such Securities. In the event of a default by any Underwriter as set forth in this Section 11, the Closing Date shall be postponed for such period, not exceeding five Business Days, as the Representatives shall determine in order that the required changes in the Registration Statement, the Time of Sale Information and the Prospectus or in any other documents or arrangements may be effected. If nondefaulting Underwriters are not obligated to take up and pay for the Securities of the defaulting Underwriter and do not elect to purchase all the Securities and the Issuer does not arrange for another satisfactory purchaser, then this Agreement will terminate without liability to any nondefaulting Underwriter, the Company or the Issuer. Nothing contained in this Agreement shall relieve any defaulting Underwriter of its liability, if any, to the Issuer and the Guarantors or any nondefaulting Underwriter for damages occasioned by its default hereunder.
12. Applicable Law. This Agreement will be governed by and construed in accordance with the laws of the State of New York applicable to contracts made and to be performed within the State of New York.
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13. Waiver of Jury Trial. The Issuer and the Company hereby irrevocably waive, to the fullest extent permitted by applicable law, any and all rights to trial by jury in any legal proceeding arising out of or relating to this Agreement or the transaction contemplated hereby.
14. Integration. This Agreement supersedes all prior agreements and understandings (whether written or oral) among the Issuer and the Company, on the one hand, and the Underwriters, or any of them, on the other, with respect to the subject matter hereof.
15. Counterparts. This Agreement may be executed in one or more counterparts, each of which shall constitute an original and all of which together shall constitute one and the same instrument.
16. Headings. The section headings used herein are for convenience only and shall not affect the construction hereof.
17. Authority of the Representatives: Any action by the Underwriters hereunder must be taken by the Representatives on behalf of the Underwriters, and any such action taken by the Representatives shall be binding upon the Underwriters.
18. Definitions. The terms which follow, when used in this Agreement, shall have the meanings indicated.
“Business Day” shall mean any day other than a Saturday, a Sunday or a legal holiday or a day on which banking institutions or trust companies are authorized or obligated by law to close in The City of New York.
“Commission” shall mean the Securities and Exchange Commission.
“Effective Date” shall mean each date and time that the Registration Statement and any post-effective amendment or amendments thereto became or becomes effective.
“Exchange Act” shall mean the Securities Exchange Act of 1934, as amended, and the rules and regulations of the Commission promulgated thereunder.
“Investment Company Act” shall mean the Investment Company Act of 1940, as amended, and the rules and regulations of the Commission promulgated thereunder.
“Issuer Free Writing Prospectus” shall mean an issuer free writing prospectus, as defined in Rule 405 under the Securities Act.
“Prospectus Delivery Period” shall mean such period of time after the first date of the public offering of the Securities as in the opinion of counsel for the Underwriters a Prospectus relating to the Securities is required by law to be delivered (or required to be delivered but for Rule 172 under the Securities Act) in connection with sales of the Securities by the Underwriters or any dealer.
“Securities Act” shall mean the Securities Act of 1933, as amended, and the rules and regulations of the Commission promulgated thereunder.
“Trust Indenture Act” shall mean the Trust Indenture Act of 1939, as amended, and the rules and regulations of the Commission promulgated thereunder.
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19. Regulatory. In accordance with the requirements of the USA Patriot Act (Title III of Pub. L. 107-56 (signed into law October 26, 2001) (the “PATRIOT Act”)) and the requirements of 31 C.F.R. §1010.230 (the “Beneficial Ownership Regulation”), the Underwriters are required to obtain, verify and record information that identifies their respective clients, including the Company, which information may include the name and address of their respective clients, as well as other information that will allow the Underwriters to properly identify their respective clients in accordance with the PATRIOT Act or the Beneficial Ownership Regulation.
20. Recognition of the U.S. Special Resolution Regimes.
(a) In the event that any Underwriter that is a Covered Entity becomes subject to a proceeding under a U.S. Special Resolution Regime, the transfer from such Underwriter of this Agreement, and any interest and obligation in or under this Agreement, will be effective to the same extent as the transfer would be effective under the U.S. Special Resolution Regime if this Agreement, and any such interest and obligation, were governed by the laws of the United States or a state of the United States.
(b) In the event that any Underwriter that is a Covered Entity or a BHC Act Affiliate of such Underwriter becomes subject to a proceeding under a U.S. Special Resolution Regime, Default Rights under this Agreement that may be exercised against such Underwriter are permitted to be exercised to no greater extent than such Default Rights could be exercised under the U.S. Special Resolution Regime if this Agreement were governed by the laws of the United States or a state of the United States.
For purposes of this Section 19:
“BHC Act Affiliate” has the meaning assigned to the term “affiliate” in, and shall be interpreted in accordance with, 12 U.S.C. § 1841(k).
“Covered Entity” means any of the following:
(i) a “covered entity” as that term is defined in, and interpreted in accordance with, 12 C.F.R. § 252.82(b),
(ii) a “covered bank” as that term is defined in, and interpreted in accordance with, 12 C.F.R. § 47.3(b), or
(iii) a “covered FSI” as that term is defined in, and interpreted in accordance with, 12 C.F.R. § 382.2(b);
“Default Right” has the meaning assigned to that term in, and shall be interpreted in accordance with, 12 C.F.R. §§ 252.81, 47.2 or 382.1, as applicable.
“U.S. Special Resolution Regime” means each of (x) the Federal Deposit Insurance Act and the regulations promulgated thereunder and (y) Title II of the Dodd-Frank Wall Street Reform and Consumer Protection Act and the regulations promulgated thereunder.
[Signature pages follow]
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If the foregoing is in accordance with your understanding of our agreement, please sign and return to us the enclosed duplicate hereof, whereupon this Agreement and your acceptance shall represent a binding agreement among the Issuer, the Company and the Underwriters.
| Very truly yours, | ||||
| TOLL BROTHERS FINANCE CORP., | ||||
| As Issuer | ||||
| By: | /s/ Martin P. Connor | |||
| Name: | Martin P. Connor | |||
| Title: | Senior Vice President and Chief Financial Officer | |||
| TOLL BROTHERS, INC., | ||||
| As a Guarantor | ||||
| By: | /s/ Martin P. Connor | |||
| Name: |
Martin P. Connor | |||
| Title: |
Senior Vice President and Chief Financial Officer | |||
S-1
The foregoing Agreement is hereby
confirmed and accepted as of the
date first above written.
BOFA SECURITIES INC.
| By: | /s/ Chris Porter | |||
| Name: | Chris Porter | |||
| Title: | Managing Director Investment Banking | |||
| CITIGROUP GLOBAL MARKETS INC. | ||||
| By: | /s/ Adam D. Bordner | |||
| Name: | Adam D. Bordner | |||
| Title: | Director | |||
| GOLDMAN SACHS & CO. LLC | ||||
| By: | /s/ Ariel Fox | |||
| Name: | Ariel Fox | |||
| Title: | Vice President | |||
| MIZUHO SECURITIES USA LLC | ||||
| By: | /s/ Andrew Rothstein | |||
| Name: | Andrew Rothstein | |||
| Title: | Managing Director | |||
| PNC CAPITAL MARKETS LLC | ||||
| By: | /s/ Valerie Shadeck | |||
| Name: | Valerie Shadeck | |||
| Title: | Director | |||
| SUNTRUST ROBINSON HUMPHREY | ||||
| By: | /s/ Robert Nordlinger | |||
| Name: | Robert Nordlinger | |||
| Title: | Director | |||
S-2
| WELLS FARGO SECURITIES | ||||||
| By: | /s/ Carolyn Hurley | |||||
| Name: | Carolyn Hurley | |||||
| Title: | Director | |||||
| For themselves and the other several Underwriters named in Annex A to the foregoing Agreement | ||||||
S-3
ANNEX A
| Underwriter |
Principal Amount of Notes |
|||
| BofA Securities, Inc. |
$ | 38,000,000 | ||
| Citigroup Global Markets Inc. |
$ | 38,000,000 | ||
| Goldman Sachs & Co. LLC |
$ | 38,000,000 | ||
| Mizuho Securities USA LLC |
$ | 38,000,000 | ||
| PNC Capital Markets LLC |
$ | 38,000,000 | ||
| SunTrust Robinson Humphrey, Inc. |
$ | 38,000,000 | ||
| Wells Fargo Securities, LLC |
$ | 38,000,000 | ||
| SMBC Nikko Securities America, Inc. |
$ | 20,000,000 | ||
| Capital One Securities, Inc. |
$ | 20,000,000 | ||
| U.S. Bancorp Investments, Inc. |
$ | 20,000,000 | ||
| Citizens Capital Markets, Inc. |
$ | 13,000,000 | ||
| Fifth Third Securities, Inc. |
$ | 13,000,000 | ||
| Regions Securities LLC |
$ | 13,000,000 | ||
| BB&T Capital Markets, a division of BB&T Securities, LLC |
$ | 8,000,000 | ||
| BNY Mellon Capital Markets, LLC |
$ | 8,000,000 | ||
| Comerica Securities, Inc. |
$ | 8,000,000 | ||
| TD Securities (USA) LLC |
$ | 8,000,000 | ||
| BNP Paribas Securities Corp. |
$ | 3,000,000 | ||
| Total |
$ | 400,000,000 | ||
Annex A-1
ANNEX B
Schedule of Free Writing Prospectuses Included in the Time of Sale Information
| 1. | Pricing Term Sheet of the Issuer and the Guarantors relating to the Securities dated September 9, 2019. |
Annex B-1
ANNEX C
[as attached]
Annex C-1
Toll Brothers Finance Corp.
$400,000,000 3.800% Senior Notes due 2029
Guaranteed on a Senior Basis by
Toll Brothers, Inc.
and Certain of its Subsidiaries
Pricing Term Sheet
This pricing term sheet to the Preliminary Prospectus Supplement dated September 9, 2019 (the “Preliminary Prospectus Supplement”) related to the offering of the notes described above should be read together with the Preliminary Prospectus Supplement, and the information incorporated by reference therein, before making an investment decision with regard to the notes. The information in this pricing term sheet supersedes the information in the Preliminary Prospectus Supplement to the extent that it is inconsistent therewith. Capitalized terms used but not defined in this pricing term sheet shall have the meaning ascribed to them in the Preliminary Prospectus Supplement.
| Issuer: | Toll Brothers Finance Corp. | |
| Security: | 3.800% Senior Notes due 2029 | |
| Principal Amount: | $400,000,000 | |
| Net Proceeds to Issuer Before Expenses: | $397,400,000 | |
| Maturity Date: | November 1, 2029 | |
| Coupon: | 3.800% | |
| Public Offering Price: | 100.000% of the principal amount, plus accrued interest, if any, from September 12, 2019 | |
| Yield to Maturity: | 3.800% | |
| Benchmark Treasury: | UST 1.625% due August 15, 2029 | |
| Benchmark Treasury Price: | 99-25+ | |
| Benchmark Treasury Yield: | 1.647% | |
| Optional Redemption: | Make-whole call at T+50 bps prior to August 1, 2029 (or, if greater, at 100% of the principal amount being redeemed), plus accrued and unpaid interest. On or after August 1, 2029, redeemable at 100% of the principal amount of the notes to be redeemed, plus accrued and unpaid interest to the redemption date. | |
| Interest Payment Dates: | May 1 and November 1, commencing May 1, 2020 | |
| Record Dates: | April 15 and October 15 | |
| Trade Date: | September 9, 2019 | |
| Settlement: | T+3; September 12, 2019 | |
| Expected Ratings*: | ||
| CUSIP: | 88947E AU4 | |
| ISIN: | US88947EAU47 | |
| Joint Book-Running Managers: | BofA Securities, Inc. Citigroup Global Markets Inc. Goldman Sachs & Co. LLC Mizuho Securities USA LLC PNC Capital Markets LLC SunTrust Robinson Humphrey, Inc. Wells Fargo Securities, LLC |
| Lead Managers: | Capital One Securities, Inc. U.S. Bancorp Investments, Inc. | |
| Co-Managers: | Citizens Capital Markets, Inc. Fifth Third Securities, Inc. Regions Securities LLC BB&T Capital Markets, a division of BB&T Securities, LLC BNY Mellon Capital Markets, LLC Comerica Securities, Inc. TD Securities (USA) LLC BNP Paribas Securities Corp. |
| * | Note: A securities rating is not a recommendation to buy, sell or hold securities and may be subject to revision or withdrawal at any time. |
The issuer has filed a registration statement (including a prospectus and a prospectus supplement) with the SEC for the offering to which this communication relates. Before you invest, you should read the Preliminary Prospectus Supplement and other documents the issuer has filed with the SEC that are incorporated by reference in the Preliminary Prospectus Supplement for more complete information about the issuer and this offering. You may get these documents for free by visiting EDGAR on the SEC website at www.sec.gov. Alternatively, the issuer, any underwriter or any dealer participating in the offering will arrange to send you the Preliminary Prospectus Supplement if you request it by calling BofA Securities, Inc. toll free at 1-800-294-1322, Citigroup Global Markets Inc. toll free at 1-800-831-9146, Goldman Sachs & Co. LLC toll free at 1-866-471-2526, Mizuho Securities USA LLC toll free at 1-866-271-7403, PNC Capital Markets LLC toll free at 1-855-881-0697, SunTrust Robinson Humphrey, Inc. toll free at 1-800-685-4786 or Wells Fargo Securities, LLC toll free at 1-800-645-3751.
Any disclaimers or other notices that may appear below are not applicable to this communication and should be disregarded. Such disclaimers or other notices were automatically generated as a result of this communication being sent via Bloomberg or other email system.
Exhibit 4.2
AUTHORIZING RESOLUTION
3.800% SENIOR NOTES DUE 2029
September 12, 2019
This Authorizing Resolution relates to $400,000,000 aggregate principal amount of 3.800% Senior Notes due 2029 to be issued in accordance with the indenture dated as of February 7, 2012 (as amended and supplemented, the “Indenture”), among Toll Brothers Finance Corp. (the “Issuer”), Toll Brothers, Inc. (the “Company”) and the other Guarantors and The Bank of New York Mellon, as trustee (the “Trustee”). In the event of a conflict between any provisions of the Indenture and this Authorizing Resolution, the relevant provision or provisions of this Authorizing Resolution shall govern with respect to the Notes (as defined below). Capitalized terms not otherwise defined herein but used below shall have the meanings given to them in the Indenture.
PARAGRAPH 1. The title of the senior notes shall be “3.800% Senior Notes due 2029” (the “Notes”).
PARAGRAPH 2. The aggregate principal amount of the Notes that shall be authenticated and delivered under the Indenture, shall be $400,000,000 (except for any Notes authenticated and delivered upon registration of the transfer of, or in exchange for, or in lieu of other Notes pursuant to the terms of the Indenture); provided, however, that, subject to the following two sentences, the Notes may be reopened for issuances of an unlimited amount of additional Notes at any time in accordance with the terms of the Indenture. The Issuer will not issue any additional Notes with the same CUSIP number as the Notes authenticated by the prior sentence if they will not be fungible with such Notes for U.S. federal income tax purposes. Any additional Notes will constitute part of the same series as the Notes authenticated by the second preceding sentence. The form of Notes shall be in the form of Exhibit A hereto. The Notes will be issued only in fully registered form without interest coupons, in denominations of $2,000 and integral multiples of $1,000 in excess thereof.
PARAGRAPH 3. The principal amount of the Notes is due and payable in full on November 1, 2029, subject to any earlier redemption as referred to in the Indenture.
The principal of, premium, if any, and interest on the Notes will be payable, and, subject to the restrictions on transfer described in the Indenture, the Notes may be surrendered for registration of transfer or exchange, at the office or agency maintained by the Issuer for that purpose; provided that payments of interest may be made at the Issuer’s option by check mailed to the address of the persons entitled thereto or by transfer to an account maintained by the payee with a bank located in the United States. The office or agency initially maintained by the Issuer for the foregoing purposes will be the corporate trust office of the Trustee.
PARAGRAPH 4. Interest on the Notes shall accrue at a rate of 3.800% per annum (computed on the basis of a 360-day year of twelve 30-day months), from
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September 12, 2019 to maturity or any earlier redemption; and interest will be payable semiannually in arrears on May 1 and November 1 of each year, commencing on May 1, 2020, to the Holders in whose names such Notes are registered at the close of business on April 15 or October 15, as the case may be, preceding such interest payment date.
PARAGRAPH 5. Prior to the Par Call Date, the Issuer may, at its option, redeem the Notes in whole at any time, or in part from time to time, by providing notice thereof pursuant to Section 3.03 of the Indenture, at a redemption price equal to the greater of (a) 100% of the principal amount of the Notes being redeemed and (b) the present value of the Remaining Scheduled Payments (as defined below) on the Notes being redeemed on the redemption date (assuming, for this purpose, that the Notes are scheduled to mature on the Par Call Date), discounted to the date of redemption, on a semiannual basis, at the Treasury Rate plus 50 basis points. On or after the Par Call Date, the Issuer may, at its option, redeem the Notes in whole at any time, or in part from time to time, at a redemption price equal to 100% of the principal amount of the Notes to be redeemed. In both instances, the Issuer will also pay accrued and unpaid interest on the Notes to be redeemed to the date of redemption. In determining the redemption price and accrued and unpaid interest, interest will be calculated on the basis of a 360-day year consisting of twelve 30-day months. If money sufficient to pay the redemption price of and accrued and unpaid interest on the Notes to be redeemed is deposited with the Trustee on or before the redemption date, on and after the redemption date interest will cease to accrue on the Notes (or such portions thereof) called for redemption and such Notes will cease to be outstanding. Notice of any redemption may, at the Issuer’s discretion, be subject to one or more conditions precedent. In the event that any relevant condition precedent is not satisfied (or waived by the Issuer) as of the date specified for redemption in any such notice of redemption (or amendment thereto), the Issuer may, in its discretion, rescind such notice or amend it on one or more occasions to specify another redemption date until the satisfaction (or waiver by the Issuer) of any such conditions precedent, unless such notice is earlier rescinded by the Issuer as described above.
As used in this Paragraph 5, the following terms shall have the respective meanings set forth below:
“Comparable Treasury Issue” means the United States Treasury security selected by the Reference Treasury Dealer as having a maturity comparable to the remaining term of the Notes to be redeemed (assuming, for this purpose, that the Notes are scheduled to mature on the Par Call Date) that would be utilized, at the time of selection and in accordance with customary financial practice, in pricing new issues of corporate debt securities of comparable maturity to such remaining term of such Notes.
“Comparable Treasury Price” means, with respect to any redemption date, (1) the average of the Reference Treasury Dealer Quotations for such redemption date, after excluding the highest and lowest such Reference Treasury Dealer Quotations, or (2) if the Quotation Agent obtains fewer than four such Reference Treasury Dealer Quotations, the average of all such quotations.
2
“Par Call Date” means the date that is three months prior to the date that the Notes are scheduled to mature.
“Quotation Agent” means one of the Reference Treasury Dealers appointed by the Issuer.
“Reference Treasury Dealer” means (A) BofA Securities, Inc., Citigroup Global Markets Inc., Goldman Sachs & Co. LLC, Mizuho Securities USA LLC, PNC Capital Markets LLC, a primary U.S. government securities dealer selected by SunTrust Robinson Humphrey, Inc. and Wells Fargo Securities, LLC (or their respective successors or affiliates that are Primary Treasury Dealers (as defined below)), and any successor; provided, however, that if any of the foregoing shall cease to be a primary U.S. government securities dealer in New York City (a “Primary Treasury Dealer”), the Issuer will substitute therefor another Primary Treasury Dealer; and (B) any other Primary Treasury Dealer(s) selected by the Issuer.
“Reference Treasury Dealer Quotations” means, with respect to each Reference Treasury Dealer and any redemption date, the average, as determined by the Quotation Agent, of the bid and asked prices for the Comparable Treasury Issue (expressed in each case as a percentage of its principal amount) quoted in writing to the Quotation Agent by such Reference Treasury Dealer at 5:00 p.m. on the third business day preceding such redemption date.
“Remaining Scheduled Payments” means, with respect to any Note, the remaining scheduled payments of the principal thereof to be redeemed and interest thereon that would be due after the related redemption date but for such redemption (assuming, for this purpose, that the Notes are scheduled to mature on the Par Call Date); provided, however, that if such redemption date is not an interest payment date with respect to such Note, the amount of the next succeeding scheduled interest payment thereon will be reduced by the amount of interest accrued thereon to such redemption date.
“Treasury Rate” means, with respect to any redemption date, the rate per annum equal to the semi-annual equivalent yield to maturity of the Comparable Treasury Issue, assuming a price for the Comparable Treasury Issue (expressed as a percentage of its principal amount) equal to the Comparable Treasury Price for such redemption date.
PARAGRAPH 6. If a Change of Control Repurchase Event occurs, unless the Issuer has previously exercised its right to redeem the Notes as described above, the Issuer will make an offer to each Holder of Notes to repurchase all or any part (in amounts of $2,000 or in integral multiples of $1,000 in excess thereof) of that Holder’s Notes at a repurchase price in cash equal to 101% of the aggregate principal amount of repurchased Notes plus any accrued and unpaid interest on the repurchased Notes to the date of purchase. Within 30 days following any Change of Control Repurchase Event or, at the Issuer’s option, prior to any Change of Control, but after the public announcement
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of the Change of Control, the Issuer will send a notice to each Holder, with a copy to the Trustee, describing the transaction or transactions that constitute or may constitute the Change of Control Repurchase Event and offering to repurchase Notes on the payment date specified in the notice, which date will be no earlier than 30 days and no later than 60 days from the date such notice is sent. The notice shall, if sent prior to the date of consummation of the Change of Control, state that the offer to purchase is conditioned on the Change of Control Repurchase Event occurring on or prior to the payment date specified in the notice. The Issuer will comply with the requirements of Rule 14e-1 under the Exchange Act and any other securities laws and regulations under the Exchange Act to the extent those laws and regulations are applicable in connection with the repurchase of the Notes as a result of a Change of Control Repurchase Event. To the extent that the provisions of any securities laws or regulations conflict with the Change of Control Repurchase Event provisions herein, the Issuer will comply with the applicable securities laws and regulations and will not be deemed to have breached its obligations under the Change of Control Repurchase Event provisions herein by virtue of such conflict.
On the Change of Control Repurchase Event payment date, the Issuer will, to the extent lawful:
| • | accept for payment all Notes or portions of Notes properly tendered pursuant to the Issuer’s offer; |
| • | deposit with the Paying Agent an amount equal to the aggregate purchase price in respect of all Notes or portions of Notes properly tendered; and |
| • | deliver or cause to be delivered to the Trustee the Notes properly accepted, together with an Officers’ Certificate stating the aggregate principal amount of Notes being purchased by the Issuer. |
The Paying Agent will promptly send to each Holder of properly tendered Notes the purchase price for the Notes, and the Trustee will promptly authenticate and send (or cause to be transferred by book-entry) to each Holder a new Note equal in principal amount to any unpurchased portion of any Notes surrendered; provided that each new Note will be in a principal amount of $2,000 or an integral multiple of $1,000 in excess thereof.
The Issuer will not be required to make an offer to repurchase the Notes upon a Change of Control Repurchase Event if a third party makes such an offer in the manner, at the times and otherwise in compliance with the requirements for an offer made by the Issuer and such third party purchases all Notes properly tendered and not withdrawn under its offer.
As used in this Paragraph 6, the following terms shall have the respective meanings set forth below:
“Below Investment Grade Rating Event” means the Notes are rated below Investment Grade (defined below) by all three Rating Agencies on any date from
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the date of the public notice of an arrangement that could result in a Change of Control until the end of the 60-day period following public notice of the occurrence of a Change of Control (which period shall be extended so long as the rating of the Notes is under publicly announced consideration for possible downgrade by any of the Rating Agencies); provided that a Below Investment Grade Rating Event otherwise arising by virtue of a particular reduction in rating shall not be deemed to have occurred in respect of a particular Change of Control (and thus shall not be deemed a Below Investment Grade Rating Event for purposes of the definition of Change of Control Repurchase Event) if the Rating Agencies making the reduction in rating to which this definition would otherwise apply do not announce or publicly confirm or inform the Trustee in writing at the Company’s request that the reduction was the result, in whole or in part, of any event or circumstance comprised of or arising as a result of, or in respect of, the applicable Change of Control (whether or not the applicable Change of Control shall have occurred at the time of the Below Investment Grade Rating Event).
“Change of Control” means the consummation of any transaction (including, without limitation, any merger or consolidation) the result of which is that any “person” (as that term is used in Section 13(d)(3) of the Exchange Act) becomes the beneficial owner, directly or indirectly, of more than 50% of the Company’s Voting Stock (defined below), measured by voting power rather than number of shares. Notwithstanding the foregoing, a transaction will not be deemed to involve a Change of Control if (1) the Company becomes a wholly owned subsidiary of a holding company and (2) the holders of the Voting Stock of such holding company immediately following that transaction are substantially the same as the holders of the Company’s Voting Stock immediately prior to that transaction.
“Change of Control Repurchase Event” means the occurrence of both a Change of Control and a Below Investment Grade Rating Event.
“Fitch” means Fitch Ratings, Ltd., a division of Fitch Inc.
“Investment Grade” means a rating of Baa3 or better by Moody’s (or its equivalent under any successor rating categories of Moody’s); a rating of BBB- or better by Fitch (or its equivalent under any successor rating categories of Fitch); a rating of BBB- or better by S&P (or its equivalent under any successor rating categories of S&P); and the equivalent Investment Grade credit rating from any additional Rating Agency or Rating Agencies selected by the Company.
“Rating Agency” means (1) each of Moody’s, Fitch and S&P; and (2) if any of Moody’s, Fitch or S&P ceases to rate the Notes or fails to make a rating of the Notes publicly available (for reasons outside of the Company’s control), a “nationally recognized statistical rating organization” within the meaning of Rule 15c3-1(c)(2)(vi)(F) under the Exchange Act, selected by the Company (as certified by a resolution of the Company’s board of directors) as a replacement agency for Moody’s, Fitch or S&P, or all three, as the case may be.
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“Moody’s” means Moody’s Investor Services, Inc.
“S&P” means S&P Global Ratings, a division of S&P Global Inc.
“Voting Stock” of any specified “person” (as that term is used in Section 13(d)(3) of the Exchange Act) as of any date means the capital stock of such person that is at the time entitled to vote generally in the election of the board of directors of such person.
PARAGRAPH 7. Principal of and interest on the Notes shall be payable in accordance with Section 1 and 2 of the Notes. The Depository for the Notes upon issuance will be Cede & Co., as nominee of DTC. Notwithstanding Section 2.02 of the Indenture, the Issuer’s seal shall not be required to be reproduced on the Notes.
PARAGRAPH 8. The Notes shall not be convertible into the Issuer’s or any of the Guarantors’ common stock.
PARAGRAPH 9. Neither the Notes nor the Guarantees shall be secured.
PARAGRAPH 10. As used in the Indenture, the following terms shall have the respective meanings set forth below:
“Attributable Debt” means, with respect to a Sale and Lease-back Transaction, the present value (discounted at the weighted average effective interest cost per annum of the outstanding senior notes of all series issued by the Issuer, compounded semiannually) of the obligation of the lessee for rental payments during the remaining term of the lease included in such transaction, including any period for which such lease has been extended or may, at the option of the lessor, be extended or, if earlier, until the earliest date on which the lessee may terminate such lease upon payment of a penalty (in which case the obligation of the lessee for rental payments shall include such penalty), after excluding all amounts required to be paid on account of maintenance and repairs, insurance, taxes, assessments, water and utility rates and similar charges.
“Consolidated Net Tangible Assets” means the total amount of assets which would be included on a combined balance sheet of the Issuer, the Company and the other Guarantors under accounting principles generally accepted in the United States (less applicable reserves and other properly deductible items) after deducting therefrom: (1) all short-term liabilities, except for liabilities payable by their terms more than one year from the date of determination (or renewable or extendible at the option of the obligor for a period ending more than one year after such date) and liabilities in respect of retiree benefits other than pensions for which the Restricted Subsidiaries are required to accrue pursuant to Statement of Financial Accounting Standards No. 106; (2) investments in subsidiaries that are not Restricted Subsidiaries; and (3) all goodwill, trade names, trademarks, patents, unamortized debt discount, unamortized expense incurred in the issuance of debt and other tangible assets.
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“Existing Indentures” means (1) the Indenture dated as of April 20, 2009, among the Issuer, the guarantors named therein and The Bank of New York Mellon, as trustee, as amended and supplemented by the First Supplemental Indenture through the Twenty-Second Supplemental Indenture and the resolutions dated as of September 22, 2009 authorizing the 6.750% Senior Notes due 2019, and as may be further amended and supplemented and (2) the Indenture dated as of February 7, 2012, among the Issuer, the guarantors named therein and The Bank of New York Mellon, as trustee, as amended and supplemented by the First Supplemental Indenture through the Twentieth Supplemental Indenture and the resolutions dated as of January 31, 2012 authorizing the 5.875% Senior Notes due 2022, the resolutions dated as of April 3, 2013 and May 8, 2013 authorizing the 4.375% Senior Notes due 2023, the resolutions dated as of November 21, 2013 authorizing the 5.625% Senior Notes due 2024, the resolutions dated as of October 30, 2015 authorizing the 4.875% Senior Notes due 2025, the resolutions dated as of March 10, 2017 and June 12, 2017 authorizing the 4.875% Senior Notes due 2027, the resolutions dated as of January 22, 2018 authorizing the 4.350% Senior Notes due 2028, and as may be further amended and supplemented.
“Non-Recourse Indebtedness” means the Indebtedness or other obligations secured by a Lien on property to the extent that the liability for the Indebtedness or other obligations is limited to the security of the property without liability on the part of the Issuer, the Company or any Restricted Subsidiary (other than the Restricted Subsidiary that holds title to the property) for any deficiency.
“Revolving Credit Facility” means the Credit Agreement by and among First Huntingdon Finance Corp., Toll Brothers, Inc., the lenders named therein and Citibank, N.A., as administrative agent, dated May 19, 2016, and any related documents (including, without limitation, any guarantees or security documents), as such agreements (and such related documents) may be amended, restated, supplemented, renewed, replaced by the existing lenders or by successors or otherwise modified from time to time, including any agreement(s) extending the maturity of or refinancing or refunding all or any portion of the indebtedness or increasing the amount to be borrowed under such agreement(s) or any successor agreement(s), whether or not by or among the same parties.
“Sale and Lease-back Transaction” means a sale or transfer made by the Issuer, the Company or a Restricted Subsidiary (except a sale or transfer made to the Issuer, the Company or another Restricted Subsidiary) of any property which is either (a) a manufacturing facility, office building or warehouse whose book value equals or exceeds 1% of Consolidated Net Tangible Assets as of the date of determination or (b) another property (not including a model home) which exceeds 5% of Consolidated Net Tangible Assets as of the date of determination, if such sale or transfer is made with the agreement, commitment or intention of leasing such property to the Issuer, the Company or a Restricted Subsidiary for more than a three-year term.
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“Secured Debt” means any Indebtedness which is secured by (i) a Security Interest in any of the property of the Issuer, the Company or any Restricted Subsidiary or (ii) a Security Interest in shares of stock owned directly or indirectly by the Issuer, the Company or a Restricted Subsidiary in a corporation or in equity interests owned by the Issuer, the Company or a Restricted Subsidiary in a partnership or other entity not organized as a corporation or in the Company’s rights or the rights of a Restricted Subsidiary in respect of Indebtedness of a corporation, partnership or other entity in which the Issuer, the Company or a Restricted Subsidiary has an equity interest; provided that “Secured Debt” shall not include Non-Recourse Indebtedness, as such categories of assets are determined in accordance with accounting principles generally accepted in the United States. The securing in the foregoing manner of any such Indebtedness which immediately prior thereto was not Secured Debt shall be deemed to be the creation of Secured Debt at the time security is given.
“Security Interests” means any mortgage, pledge, lien, encumbrance or other security interest which secures the payment or performance of an obligation.
PARAGRAPH 11. The Notes shall be entitled to the benefit of each of the covenants in Article Four of the Indenture and each of the following additional covenants (each of which is deemed to be a provision of the Indenture and, when referred to as a provision of the Indenture, shall be identified by reference to the Section number which is set forth immediately preceding such covenant):
Section 4.06. Restrictions on Secured Debt.
The Issuer and the Company shall not, and shall not cause or permit a Restricted Subsidiary to, create, incur, assume or guarantee any Secured Debt unless the Notes will be secured equally and ratably with (or prior to) such Secured Debt; provided, however, that this Section 4.06 does not prohibit the creation, incurrence, assumption or guarantee of Secured Debt that is secured by:
(1) Security Interests in model homes, homes held for sale, homes that are under contract for sale, contracts for the sale of homes, land (improved or unimproved), manufacturing plants, warehouses or office buildings and fixtures and equipment located thereat or thereon;
(2) Security Interests in property at the time of its acquisition by the Issuer, the Company or a Restricted Subsidiary, including Capitalized Lease Obligations, which Security Interests secure obligations assumed by the Issuer, the Company or a Restricted Subsidiary, or in the property of a corporation or other entity at the time it is merged into or consolidated with the Issuer, the Company or a Restricted Subsidiary (other than Secured Debt created in contemplation of the acquisition of such property or the consummation of such a merger or where the Security Interest attaches to or affects the property of the Issuer, the Company or a Restricted Subsidiary prior to such transaction);
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(3) Security Interests arising from conditional sales agreements or title retention agreements with respect to property acquired by the Issuer, the Company or a Restricted Subsidiary;
(4) Security Interests incurred in connection with pollution control, industrial revenue, water, sewage or any similar item; and
(5) Security Interests securing Indebtedness of a Restricted Subsidiary owing to the Issuer, the Company or to another Restricted Subsidiary that is wholly-owned (directly or indirectly) by the Company or Security Interests securing the Issuer’s Indebtedness owing to a Guarantor.
Additionally, such permitted Secured Debt includes any amendment, restatement, supplement, renewal, replacement, extension or refunding, in whole or in part, of Secured Debt permitted at the time of the original incurrence thereof.
In addition, the Issuer and the Guarantors may create, incur, assume or guarantee Secured Debt, without equally and ratably securing the Notes, if immediately thereafter the sum of (1) the aggregate principal amount of all Secured Debt outstanding (excluding Secured Debt permitted under clauses (1) through (5) above and any Secured Debt in relation to which the Notes have been equally and ratably secured) and (2) all Attributable Debt in respect of Sale and Lease-back Transactions (excluding Attributable Debt in respect of Sale and Lease-back Transactions as to which the provisions of clauses (1) through (3) of Section 4.07 “Restrictions on Sale and Lease-back Transactions” have been complied with) as of the date of determination would not exceed 20% of Consolidated Net Tangible Assets.
The provisions of this Section 4.06 with respect to limitations on Secured Debt are not applicable to Non-Recourse Indebtedness and will not restrict or limit the Issuer’s or any Guarantor’s ability to create, incur, assume or guarantee any unsecured Indebtedness, or the ability of any subsidiary which is not a Restricted Subsidiary to create, incur, assume or guarantee any secured or unsecured Indebtedness.
Section 4.07. Restrictions on Sale and Lease-back Transactions.
The Issuer and the Company shall not, and shall not permit any Restricted Subsidiary to, enter into any Sale and Lease-back Transaction, unless:
(1) notice is promptly given to the Trustee of the Sale and Lease-back Transaction;
(2) fair value is received by the Issuer, the Company or the relevant Restricted Subsidiary for the property sold (as determined in good faith by the Company communicated in writing to the Trustee); and
(3) the Issuer, the Company or a Restricted Subsidiary, within 365 days after the completion of the Sale and Lease-back Transaction, applies, or enters into a definitive agreement to apply within such 365-day period, an amount
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equal to the net proceeds of such Sale and Lease-back Transaction (x) to the redemption, repayment or retirement of (a) Securities of any Series under the Existing Indentures (including the cancellation by the Trustee of any securities of any series delivered by the Issuer to the Trustee), (b) Indebtedness of the Issuer that ranks equally with the Notes or (c) Indebtedness of any Guarantor that ranks equally with the Guarantee of such Guarantor, and/or (y) to the purchase by the Issuer, the Company or any Restricted Subsidiary of property used in their respective trade or businesses.
This Section 4.07 will not apply to a Sale and Lease-back Transaction that relates to a sale of a property that occurs within 180 days from the latest of (x) the date of acquisition of the property by the Issuer, the Company or a Restricted Subsidiary, (y) the date of the completion of construction of that property or (z) the date of commencement of full operations on that property. In addition, the Issuer and the Guarantors may, without complying with the above restrictions, enter into a Sale and Lease-back Transaction if immediately thereafter the sum of (1) the aggregate principal amount of all Secured Debt outstanding (excluding Secured Debt permitted under clauses (1) through (5) described in Section 4.06 “Restrictions on Secured Debt” and any Secured Debt in relation to which the Notes have been equally and ratably secured) and (2) all Attributable Debt in respect of Sale and Lease-back Transactions (excluding Attributable Debt in respect of Sale and Lease-back Transactions as to which the provisions of clauses (1) through (3) of this Section 4.07 have been complied with) as of the date of determination would not exceed 20% of Consolidated Net Tangible Assets
PARAGRAPH 12. The Notes shall be entitled to the benefit of the provisions of Article Five of the Indenture; provided, however, that (a) clause (2) of the first paragraph of such Article shall be amended and restated as follows:
“(2) such person (unless it has merged into the Issuer or a Guarantor) assumes by supplemental indenture, in a form reasonably satisfactory to the Trustee, all the obligations of the Issuer or such Guarantor, as the case may be, relating to the Securities or the Guarantee, as the case may be, and the Indenture; and”
and (b) the second paragraph of such Article shall be amended and restated as follows:
“Upon any such consolidation, merger, sale, assignment or transfer (including any consolidation, merger, sale, assignment, transfer described in the proviso at the end of the immediately preceding sentence) the successor corporation or legal entity, as the case may be, will be substituted for the Issuer or such Guarantor, as applicable, under the Indenture. The successor Person may, as applicable, then exercise every power and right of the Issuer or such Guarantor, as applicable, under the Indenture, and the Issuer or such Guarantor, as applicable, will be released from all of its respective liabilities and obligations in respect of the Securities or the Guarantee, as applicable, and the Indenture. If the Issuer or any Guarantor leases all or substantially all of its assets, the lessee Person will be the successor to the Issuer or such Guarantor, as applicable, and may exercise every power and right of the Issuer or such Guarantor, as applicable, under
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the Indenture, but the Issuer or such Guarantor, as applicable, will not be released from its respective obligations to pay the principal and interest, if any, on the Securities. Notwithstanding the foregoing, the requirements of the immediately preceding paragraph shall not apply to any transaction pursuant to which a Guarantor (other than Toll Brothers, Inc.) will be upon consummation thereof permitted to be released from its Guarantee in accordance with Section 9.03.”
PARAGRAPH 13. The Notes shall be entitled to the benefit of each Event of Default enumerated in Section 6.01 of the Indenture; provided, however, that sub-clause (4) of such Section 6.01 shall be amended and restated as follows:
“(4) any default under an instrument evidencing or securing any of the Issuer’s Indebtedness or the Indebtedness of any Guarantor (other than Non-Recourse Indebtedness) aggregating $75,000,000 or more in aggregate principal amount, resulting in the acceleration of such Indebtedness, or due to the failure to pay such Indebtedness at maturity, upon acceleration or otherwise;”.
PARAGRAPH 14. For the avoidance of doubt, the Notes shall be entitled to the benefit of Article Nine of the Indenture.
PARAGRAPH 15. Except as otherwise indicated, each reference herein to a “Paragraph” shall refer to a Paragraph hereof, and each reference herein to a “Section” shall refer to a Section of the Indenture.
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EXHIBIT A
[See Exhibit 4.3]
Exhibit 4.3
UNLESS AND UNTIL IT IS EXCHANGED IN WHOLE OR IN PART FOR SECURITIES IN DEFINITIVE FORM, THIS SECURITY MAY NOT BE TRANSFERRED EXCEPT AS A WHOLE BY THE DEPOSITORY TO A NOMINEE OF THE DEPOSITORY, OR BY ANY SUCH NOMINEE OF THE DEPOSITORY, OR BY THE DEPOSITORY OR NOMINEE OF SUCH SUCCESSOR DEPOSITORY OR ANY SUCH NOMINEE TO A SUCCESSOR DEPOSITORY OR A NOMINEE OF SUCH SUCCESSOR DEPOSITORY. UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION (“DTC”), TO THE ISSUER OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT HEREON IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
TRANSFERS OF THIS GLOBAL SECURITY SHALL BE LIMITED TO TRANSFERS IN WHOLE, BUT NOT IN PART, TO NOMINEES OF CEDE & CO. OR TO A SUCCESSOR THEREOF OR SUCH SUCCESSOR’S NOMINEE.
| No. 1 | CUSIP No.: 88947E AU4 |
3.800% Senior Notes due 2029
TOLL BROTHERS FINANCE CORP.
a Delaware corporation
promises to pay to CEDE & CO.
or registered assigns the principal sum of FOUR HUNDRED MILLION DOLLARS ($400,000,000) on November 1, 2029.
3.800% Senior Notes due 2029
Interest Payment Dates: May 1 and November 1
Record Dates: April 15 and October 15
Authenticated: September 12, 2019
| TOLL BROTHERS FINANCE CORP. | ||
| By |
| |
| Name: | Martin P. Connor | |
| Title: | Senior Vice President and | |
| Chief Financial Officer | ||
| By |
| |
| Name: | Gregg L. Ziegler | |
| Title: | Senior Vice President and Treasurer | |
[Signature Page to Global Note]
THE BANK OF NEW YORK MELLON, as Trustee, certifies that this is one of the Securities referred to in the within mentioned Indenture.
| By: |
| |
| Authorized Signatory |
Dated: September 12, 2019
[Signature Page to Global Note]
TOLL BROTHERS FINANCE CORP.
3.800% SENIOR NOTES DUE 2029
1. Interest.
TOLL BROTHERS FINANCE CORP. (the “Issuer”), a Delaware corporation, promises to pay interest on the principal amount of this Security at the rate per annum shown above. The Issuer will pay interest semiannually on May 1 and November 1 of each year, commencing on May 1, 2020, until the principal is paid or made available for payment. Interest on the Securities will accrue from the most recent date to which interest has been paid or duly provided for or, if no interest has been paid, from September 12, 2019, provided that, if there is no existing Default in the payment of interest and if this Security is authenticated between a Record Date referred to on the face hereof and the next succeeding interest payment date, interest shall accrue from such interest payment date. Interest will be computed on the basis of a 360-day year of twelve 30-day months.
2. Method of Payment.
The Issuer will pay interest on the Securities (except defaulted interest, if any, which will be paid on such special payment date to Holders of record on such special Record Date as may be fixed by the Issuer) to the Persons who are registered Holders of Securities at the close of business on April 15 or October 15, as the case may be, preceding such interest payment date (capitalized terms not defined herein have the meanings given to those terms in the Indenture or the Authorizing Resolution pertaining to the Securities of the Series of which this Security is a part, as applicable). Holders must surrender Securities to a Paying Agent to collect principal payments. The Issuer will pay principal and interest in money of the United States that at the time of payment is legal tender for payment of public and private debts.
3. Paying Agent and Registrar.
Initially, The Bank of New York Mellon (the “Trustee”) will act as Paying Agent and Registrar. The Issuer may change or appoint any Paying Agent, Registrar or co-Registrar without notice. Toll Brothers, Inc. (the “Company”) or any of its Subsidiaries or any of their Affiliates may act as Paying Agent, Registrar or co-Registrar.
4. Indenture.
The Issuer issued the Securities under an Indenture dated as of February 7, 2012 (the “Indenture”), among the Issuer, the Company, the other Guarantors and the Trustee. The terms of the Securities and the Guarantee include those stated in the Indenture (including those terms set forth in the Authorizing Resolution or supplemental indenture pertaining to the Securities of the Series of which this Security is a part) and those made part of the Indenture by reference to the Trust Indenture Act of 1939 (the “TIA”) as in effect on the date of the Indenture. The Securities and the Guarantee are subject to all such terms, and Holders are referred to the Indenture and the TIA for a statement of them.
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The Issuer will furnish to any Holder upon written request and without charge a copy of the Indenture and the applicable Authorizing Resolution or supplemental indenture. Requests may be made to: Toll Brothers Finance Corp., c/o Toll Brothers, Inc., 250 Gibraltar Road, Horsham, Pennsylvania 19044, Attention: Chief Financial Officer.
5. Optional Redemption.
Prior to the Par Call Date, the Issuer may, at its option, redeem the Securities in whole at any time, or in part from time to time, by providing at least 30 but not more than 60 days’ prior notice thereof, at a redemption price equal to the greater of:
| • | 100% of the principal amount of the Securities being redeemed; and |
| • | the present value of the Remaining Scheduled Payments on the Securities being redeemed on the redemption date (assuming, for this purpose, that the Securities are scheduled to mature on the Par Call Date, discounted to the date of redemption, on a semiannual basis, at the Treasury Rate plus 50 basis points (0.50%). |
The Issuer will also pay accrued and unpaid interest on the Securities being redeemed to the date of redemption.
On or after the Par Call Date, the Issuer may, at its option, redeem the Securities in whole at any time, or in part from time to time, at a redemption price equal to 100% of the principal amount of the Securities being redeemed, plus accrued and unpaid interest on the principal amount of the Securities being redeemed to the redemption date.
In determining the redemption price and accrued and unpaid interest, interest will be calculated on the basis of a 360-day year consisting of twelve 30-day months.
If money sufficient to pay the redemption price of and accrued and unpaid interest on the Securities to be redeemed is deposited with the Trustee on or before the redemption date, on and after the redemption date interest will cease to accrue on the Securities (or such portions thereof) called for redemption and such Securities (or such portions thereof) will cease to be outstanding.
Notice of any redemption may, at the Issuer’s discretion, be subject to one or more conditions precedent. In the event that any relevant condition precedent is not satisfied (or waived by the Issuer) as of the date specified for redemption in any such notice of redemption (or amendment thereto), the Issuer may, in its discretion, rescind such notice or amend it on one or more occasions to specify another redemption date until the satisfaction (or waiver by the Issuer) of any such conditions precedent, unless such notice is earlier rescinded by the Issuer as described above.
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If less than all the Securities are to be redeemed, the Securities to be redeemed shall be selected in accordance with the procedures of the Depository. Such selection shall be made from Securities outstanding and not previously called for redemption. Securities in denominations of $2,000 may only be redeemed in whole. Portions (equal to $2,000 or any integral multiple of $1,000 thereof) of the principal of Securities that have denominations larger than $2,000, may be selected for redemption. Notice of redemption will be sent at least 30 days but not more than 60 days before the redemption date to each Holder whose Securities are to be redeemed at the registered address of such Holder. On and after the redemption dates, interest ceases to accrue on the Securities or portions thereof called for redemption, provided that if the Issuer shall default in the payment of such Securities at the redemption price together with accrued and unpaid interest, interest shall continue to accrue at the rate borne by the Securities.
6. Denominations, Transfer, Exchange.
The Securities are in registered form only without coupons in denominations of $2,000 and integral multiples of $1,000 thereof. A Holder may transfer or exchange Securities by presentation of such Securities to the Registrar or a co-Registrar with a request to register the transfer or to exchange them for an equal principal amount of Securities of other denominations. The Registrar may require a Holder, among other things, to furnish appropriate endorsements and transfer documents and to pay any taxes and fees required by law or permitted by the Indenture. The Registrar need not transfer or exchange any Security selected for redemption, except the unredeemed part thereof if the Security is redeemed in part, or transfer or exchange any Securities for a period of 15 days before a selection of Securities to be redeemed.
7. Persons Deemed Owners.
The registered Holder of this Security shall be treated as the owner of it for all purposes.
8. Unclaimed Money.
If money for the payment of principal or interest remains unclaimed for two years, the Trustee or Paying Agent will pay the money back to the Issuer at its request. After that, Holders entitled to the money must look to the Issuer for payment unless an abandoned property law designates another Person.
9. Amendment, Supplement, Waiver.
Subject to certain exceptions, the Indenture, the Guarantee or the Securities may be amended or supplemented by the Issuer with the consent of the Holders of at least a majority in principal amount of the outstanding Securities and any past default or compliance with any provision relating to the Securities may be waived in a particular instance with the consent of the Holders of a majority in principal amount of the outstanding Securities. Without the consent of any Holder, the Issuer may amend or supplement the Indenture, the Guarantee or the Securities to cure any ambiguity, omission, defect or inconsistency (provided such action does not adversely affect the
3
rights of the Holders), to evidence the succession of another Person to the Issuer or any Guarantor, to add covenants of the Issuer or of the Guarantors under Article Four of the Indenture for the benefit of the Holders or to surrender rights or powers conferred upon the Issuer or the Guarantors by the Indenture, to add Events of Default for the benefit of the Holders, to change or eliminate any provisions of the Indenture (provided such change or elimination shall become effective only when none of the Securities are outstanding), to add Guarantors, to provide for the acceptance of appointment by a successor Trustee or facilitate the administration of the trusts under the Indenture by more than one Trustee, to close the Indenture as to authentication and delivery of additional Securities, to supplement Indenture provisions to permit or facilitate defeasance and discharge of the Securities (provided such action does not adversely affect the rights of the Holders), to provide that specific Indenture provisions shall not apply to an unissued Series of Securities, to provide for uncertificated Securities in addition to or in place of certificated Securities, to create a Series and establish its terms, to remove a Guarantor, other than the Company, which, in accordance with the terms of the Indenture, ceases to be liable in respect of the Guarantee, or to make any other change (provided such action does not adversely affect the rights of any Holder).
10. Trustee Dealings with the Company.
The Bank of New York Mellon, the Trustee under the Indenture, in its individual or any other capacity, may make loans to, accept deposits from and perform services for the Company or its Affiliates, and may otherwise deal with the Company or its Affiliates, as if it were not Trustee.
11. Discharge of Indenture.
The Indenture contains certain provisions pertaining to defeasance, which provisions shall for all purposes have the same effect as if set forth herein.
12. No Recourse against Others.
A director, officer, employee or stockholder, as such, of the Issuer shall not have any liability for any obligations of the Issuer under the Securities or the Indenture or for any claim based on, in respect of or by reason of, such obligations or their creation. Each Holder by accepting a Security waives and releases all such liability. The waiver and release are part of the consideration for the issue of the Securities.
13. Authentication.
This Security shall not be valid until the Trustee signs the certificate of authentication on the other side of this Security.
14. Governing Law.
This Security shall be governed by and construed in accordance with the laws of the State of New York.
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15. Abbreviations.
Customary abbreviations may be used in the name of a Holder or an assignee, such as: TEN COM (= tenants in common), TEN ENT (= tenants by the entireties), JT TEN (= joint tenants with right of survivorship and not as tenants in common), CUST (= custodian) and U/G/M/A (= Uniform Gifts to Minors Act).
ASSIGNMENT FORM
If you, the Holder, want to assign this Security, fill in the form below:
I or we assign and transfer this Security to
(Insert assignee’s social security or tax ID number)
(Print or type assignee’s name, address, and zip code)
and irrevocably appoint agent to transfer this Security on the books of the Issuer. The agent may substitute another to act for him.
| Date: | Your signature: (Sign exactly as your name appears on the other side of this Security) |
SIGNATURE GUARANTEE
Signatures must be guaranteed by an “eligible guarantor institution” meeting the requirements of the Registrar, which requirements include membership or participation in the Security Transfer Agent Medallion Program (“STAMP”) or such other “signature guarantee program” as may be determined by the Registrar in addition to, or in substitution for, STAMP, all in accordance with the Securities Exchange Act of 1934, as amended.
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GUARANTEE
The Guarantors listed on Schedule I attached hereto (the “Guarantors”) have unconditionally guaranteed, jointly and severally on a senior basis (such guarantee by each Guarantor being referred to herein as the “Guarantee”), (i) the due and punctual payment of the principal of and interest on the Securities, whether at maturity, by acceleration or otherwise, the due and punctual payment of interest on the overdue principal and interest, if any, on the Securities, to the extent lawful, and the due and punctual performance of all other obligations of the Issuer to the Holders or the Trustee all in accordance with the terms set forth in Article Nine of the Indenture and (ii) in case of any extension of time of payment or renewal of any Securities or any of such other obligations, that the same will be promptly paid in full when due or performed in accordance with the terms of the extension or renewal, whether at stated maturity, by acceleration or otherwise. No past, present or future stockholder, partner, member, officer, director, manager, general partner, employee or incorporator, as such, of any of the Guarantors shall have any liability under the Guarantee by reason of such Person’s status as stockholder, partner, member, officer, director, manager, general partner, employee or incorporator. Each Holder of a Security by accepting a Security waives and releases all such liability. This waiver and release are part of the consideration for the issuance of the Guarantee. Each Holder of a Security by accepting a Security agrees that any Guarantor other than Toll Brothers, Inc. shall have no further liability with respect to its Guarantee if such Guarantor otherwise ceases to be liable in respect of its Guarantee in accordance with the terms of the Indenture.
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The Guarantee shall not be valid or obligatory for any purpose until the certificate of authentication on the Securities upon which the Guarantee is noted shall have been executed by the Trustee under the Indenture by the manual signature of one of its authorized officers.
| TOLL BROTHERS, INC. | ||
| By: |
| |
| Name: | Gregg L. Ziegler | |
| Title: | Senior Vice President and Treasurer | |
| THE GUARANTORS LISTED ON SCHEDULE I, ATTACHED HERETO | ||
| By: |
| |
| Name: | Gregg L. Ziegler | |
| Title: | Authorized Signatory | |
| Attest: |
| |
| Name: | Martin P. Connor | |
| Title: | Senior Vice President and Assistant Secretary | |
[Signature Page to Global Note Guarantee]
SCHEDULE I
The Guarantors
| 110-112 Third Ave. Realty Corp. | First Brandywine LLC II | |
| 126-142 Morgan Street Urban Renewal LLC | First Brandywine Partners, L.P. | |
| 134 Bay Street LLC | First Huntingdon Finance Corp. | |
| 1400 Hudson LLC | Frenchman’s Reserve Realty, LLC | |
| 1450 Washington LLC | Goshen Road Land Company LLC | |
| 1451 Hudson LLC | Greens at Waynesborough, L.P. | |
| 1500 Garden St. LLC | Hatboro Road Associates LLC | |
| 700 Grove Street Urban Renewal LLC | Hoboken Cove LLC | |
| 89 Park Avenue LLC | Hoboken Land I LLC | |
| Arbor Hills Development LLC | Hoboken Land LP | |
| Arbors Porter Ranch, LLC | Hockessin Chase, L.P. | |
| Ashford Land Company, L.P. | HQZ Acquisitions, Inc. | |
| Audubon Ridge, L.P. | Jacksonville TBI Realty LLC | |
| Belmont Country Club I LLC | Laurel Creek, L.P. | |
| Belmont Country Club II LLC | Liseter Land Company LLC | |
| Belmont Land, L.P. | Liseter, LLC | |
| Binks Estates Limited Partnership | LL Parcel E, LLC | |
| Block 255 LLC | Long Meadows TBI, LLC | |
| Block 268 LLC | Loudoun Valley Associates, L.P. | |
| Brier Creek Country Club I LLC | Martinsburg Ventures, L.L.C. | |
| Brier Creek Country Club II LLC | Mizner Realty, L.L.C. | |
| Broad Run Associates, L.P. | Morgan Street JV LLC | |
| Byers Commercial LLC | Naples TBI Realty, LLC | |
| Byers Commercial LP | NC Country Club Estates Limited Partnership | |
| CC Estates Limited Partnership | Orlando TBI Realty LLC | |
| Cold Spring Hunt, L.P. | Placentia Development Company, LLC | |
| Coleman-Toll Limited Partnership | Plum Canyon Master LLC | |
| Component Systems I LLC | Porter Ranch Development Co. | |
| Component Systems II LLC | PRD Investors, Inc. | |
| CWG Construction Company LLC | PRD Investors, LLC | |
| Dominion Country Club, L.P. | PT Maxwell Holdings, LLC | |
| Dominion III Corp. | PT Maxwell, L.L.C. | |
| Dominion Valley Country Club I LLC | Rancho Costera LLC | |
| Dominion Valley Country Club II LLC | Regency at Denville, LLC | |
| Enclave at Long Valley I LLC | Regency at Dominion Valley LLC | |
| Enclave at Long Valley II LLC | Regency at Washington I LLC | |
| ESE Consultants, Inc. | Regency at Washington II LLC | |
| Estates at Princeton Junction, L.P. | Shapell Hold Properties No. 1, LLC | |
| Fairfax Investment, L.P. | Shapell Homes, Inc. | |
| First Brandywine Investment Corp. II | Shapell Industries, Inc. | |
| First Brandywine Investment Corp. IV | Shapell Land Company, LLC | |
| First Brandywine LLC I | Silverman-Toll Limited Partnership |
Page 1 of 5
| Sorrento at Dublin Ranch I LP | Toll CA IV, L.P. | |
| Sorrento at Dublin Ranch III LP | Toll CA IX, L.P. | |
| South Riding Amberlea LP | Toll CA Note II LLC | |
| South Riding Partners Amberlea LP | Toll CA V, L.P. | |
| South Riding Partners, L.P. | Toll CA VI, L.P. | |
| South Riding Realty LLC | Toll CA VII, L.P. | |
| South Riding, L.P. | Toll CA VIII, L.P. | |
| Southport Landing Limited Partnership | Toll CA X, L.P. | |
| Springton Pointe, L.P. | Toll CA XI, L.P. | |
| SR Amberlea LLC | Toll CA XII, L.P. | |
| SRLP II LLC | Toll CA XIX, L.P. | |
| Stone Mill Estates, L.P. | Toll CA XX, L.P. | |
| Swedesford Chase, L.P. | Toll CA, L.P. | |
| Tampa TBI Realty LLC | Toll Cedar Hunt LLC | |
| TB Kent Partners LLC | Toll Centennial Corp. | |
| TB Proprietary Corp. | Toll CO I LLC | |
| TBI/Palm Beach Limited Partnership | Toll CO II, L.P. | |
| The Bird Estate Limited Partnership | Toll CO III, L.P. | |
| The Regency Golf Club I LLC | Toll CO, L.P. | |
| The Regency Golf Club II LLC | Toll Corners LLC | |
| The Silverman Building Companies, Inc. | Toll Corp. | |
| Toll Architecture I, P.A. | Toll CT II Limited Partnership | |
| Toll Architecture, Inc. | Toll CT III Limited Partnership | |
| Toll at Brier Creek Limited Partnership | Toll CT IV Limited Partnership | |
| Toll at Westlake, L.P. | Toll CT Limited Partnership | |
| Toll at Whippoorwill, L.P. | Toll Dallas TX LLC | |
| Toll Austin TX II LLC | Toll DE II LP | |
| Toll Austin TX III LLC | Toll DE LP | |
| Toll Austin TX LLC | Toll Diamond Corp. | |
| Toll BBC II LLC | Toll EB, LLC | |
| Toll BBC LLC | Toll Equipment, L.L.C. | |
| Toll Brooklyn L.P. | Toll Estero Limited Partnership | |
| Toll Bros. of Arizona, Inc. | Toll FL I, LLC | |
| Toll Bros. of North Carolina II, Inc. | Toll FL II Limited Partnership | |
| Toll Bros. of North Carolina, Inc. | Toll FL III Limited Partnership | |
| Toll Bros., Inc. | Toll FL IV Limited Partnership | |
| Toll Brothers AZ Construction Company | Toll FL IV LLC | |
| Toll Brothers AZ Limited Partnership | Toll FL Limited Partnership | |
| Toll Brothers Canada USA, Inc. | Toll FL V Limited Partnership | |
| Toll Brothers Real Estate, Inc. | Toll FL V LLC | |
| Toll Brothers, Inc. | Toll FL VI Limited Partnership | |
| Toll CA Holdings, Inc. | Toll FL VII Limited Partnership | |
| Toll CA I LLC | Toll FL VIII Limited Partnership | |
| Toll CA II, L.P. | Toll FL X Limited Partnership | |
| Toll CA III LLC | Toll FL XII Limited Partnership | |
| Toll CA III, L.P. | Toll FL XIII Limited Partnership |
Page 2 of 5
| Toll Ft. Myers Limited Partnership | Toll MA Land III Limited Partnership | |
| Toll GA LP | Toll MA Land Limited Partnership | |
| Toll Glastonbury LLC | Toll MA Management LLC | |
| Toll Golden Corp. | Toll MD AF Limited Partnership | |
| Toll Grove LP | Toll MD I, L.L.C. | |
| Toll Henderson LLC | Toll MD II Limited Partnership | |
| Toll Hoboken LLC | Toll MD II LLC | |
| Toll Holdings, Inc. | Toll MD III Limited Partnership | |
| Toll Houston Land LLC | Toll MD III LLC | |
| Toll Houston TX LLC | Toll MD IV Limited Partnership | |
| Toll Hudson LP | Toll MD IV LLC | |
| Toll ID I LLC | Toll MD IX Limited Partnership | |
| Toll IL HWCC, L.P. | Toll MD Limited Partnership | |
| Toll IL II, L.P. | Toll MD V Limited Partnership | |
| Toll IL III, L.P. | Toll MD VI Limited Partnership | |
| Toll IL IV, L.P. | Toll MD VII Limited Partnership | |
| Toll IL WSB, L.P. | Toll MD VIII Limited Partnership | |
| Toll IL, L.P. | Toll MD X Limited Partnership | |
| Toll IN LLC | Toll MD XI Limited Partnership | |
| Toll Jacksonville Limited Partnership | Toll MI II Limited Partnership | |
| Toll Jupiter LLC | Toll MI III Limited Partnership | |
| Toll Land Corp. No. 50 | Toll MI IV Limited Partnership | |
| Toll Land IV Limited Partnership | Toll MI Limited Partnership | |
| Toll Land IX Limited Partnership | Toll MI V Limited Partnership | |
| Toll Land V Limited Partnership | Toll MI VI Limited Partnership | |
| Toll Land VI Limited Partnership | Toll MI VII Corp. | |
| Toll Land VII LLC | Toll Mid-Atlantic II LLC | |
| Toll Land X Limited Partnership | Toll Mid-Atlantic LP Company, Inc. | |
| Toll Land XI Limited Partnership | Toll Mid-Atlantic V Corp. | |
| Toll Land XIX Limited Partnership | Toll Midwest LLC | |
| Toll Land XV Limited Partnership | Toll MN II, L.P. | |
| Toll Land XVI Limited Partnership | Toll MN, L.P. | |
| Toll Land XVIII Limited Partnership | Toll Morgan Street LLC | |
| Toll Land XX Limited Partnership | Toll Naval Associates | |
| Toll Land XXI Limited Partnership | Toll NC I LLC | |
| Toll Land XXII Limited Partnership | Toll NC II LP | |
| Toll Land XXIII Limited Partnership | Toll NC III LP | |
| Toll Land XXV Limited Partnership | Toll NC IV LLC | |
| Toll Lexington LLC | Toll NC Note II LLC | |
| Toll MA Development LLC | Toll NC Note LLC | |
| Toll MA Holdings LLC | Toll NC, L.P. | |
| Toll MA I LLC | Toll NJ I, L.L.C. | |
| Toll MA II LLC | Toll NJ II, L.L.C. | |
| Toll MA III LLC | Toll NJ II, L.P. | |
| Toll MA IV LLC | Toll NJ III, L.P. | |
| Toll MA Land II GP LLC | Toll NJ III, LLC |
Page 3 of 5
| Toll NJ IV LLC | Toll PA, L.P. | |
| Toll NJ IV, L.P. | Toll Port Imperial LLC | |
| Toll NJ VI, L.P. | Toll Prasada LLC | |
| Toll NJ VII, L.P. | Toll Realty Holdings Corp. I | |
| Toll NJ VIII, L.P. | Toll Realty Holdings Corp. II | |
| Toll NJ XI, L.P. | Toll Realty Holdings LP | |
| Toll NJ XII LP | Toll RI II, L.P. | |
| Toll NJ, L.P. | Toll RI, L.P. | |
| Toll NJX-I Corp. | Toll San Antonio TX LLC | |
| Toll North LV LLC | Toll SC II, L.P. | |
| Toll North Reno LLC | Toll SC III, L.P. | |
| Toll Northeast LP Company, Inc. | Toll SC IV, L.P. | |
| Toll Northeast II LLC | Toll SC, L.P. | |
| Toll Northeast Services, Inc. | Toll South LV LLC | |
| Toll Northeast V Corp. | Toll South Reno LLC | |
| Toll Northeast VIII LLC | Toll Southeast II LLC | |
| Toll NV GP Corp. | Toll Southeast Inc. | |
| Toll NV GP I LLC | Toll Southeast LP Company, Inc. | |
| Toll NV Holdings LLC | Toll Southwest II LLC | |
| Toll NV Limited Partnership | Toll Southwest LLC | |
| Toll NY II LLC | Toll Sparks LLC | |
| Toll NY III L.P. | Toll Stonebrae LP | |
| Toll NY IV L.P. | Toll Stratford LLC | |
| Toll NY L.P. | Toll SW Holding I Corp. | |
| Toll NY V L.P. | Toll SW Holding LLC | |
| Toll Orlando Limited Partnership | Toll TX Note LLC | |
| Toll PA Development LP | Toll VA GP Corp. | |
| Toll PA II, L.P. | Toll VA II, L.P. | |
| Toll PA III, L.P. | Toll VA III, L.L.C. | |
| Toll PA IV, L.P. | Toll VA III, L.P. | |
| Toll PA IX, L.P. | Toll VA IV, L.P. | |
| Toll PA Management LP | Toll VA L.L.C. | |
| Toll PA Twin Lakes LLC | Toll VA Member Two, Inc. | |
| Toll PA V, L.P. | Toll VA V, L.P. | |
| Toll PA VI, L.P. | Toll VA VI, L.P. | |
| Toll PA VIII, L.P. | Toll VA VII, L.P. | |
| Toll PA X, L.P. | Toll VA VIII, L.P. | |
| Toll PA XI, L.P. | Toll VA, L.P. | |
| Toll PA XII, L.P. | Toll Van Wyck, LLC | |
| Toll PA XIII, L.P. | Toll Vanderbilt II LLC | |
| Toll PA XIV, L.P. | Toll West Coast II LLC | |
| Toll PA XIX, L.P. | Toll West Coast LLC | |
| Toll PA XV, L.P. | Toll West Inc. | |
| Toll PA XVI, L.P. | Toll WV GP Corp. | |
| Toll PA XVII, L.P. | Toll WV LP | |
| Toll PA XVIII, L.P. | Toll YL II, L.P. |
Page 4 of 5
| Toll-Dublin, L.P. |
| Toll-Dublin, LLC |
| Upper K Investors, Inc. |
| Upper K Investors, LLC |
| Upper K-Shapell, LLC |
| Vanderbilt Capital, LLC |
| Virginia Construction Co. I, LLC |
| Virginia Construction Co. II, LLC |
Page 5 of 5
Exhibit 5.1
[Letterhead of]
CRAVATH, SWAINE & MOORE LLP
[New York Office]
September 12, 2019
Toll Brothers, Inc.
$400,000,000 3.800% Senior Notes due 2029
Ladies and Gentlemen:
We have acted as counsel to Toll Brothers, Inc., a Delaware corporation (the “Company”), and Toll Brothers Finance Corp., a Delaware corporation (the “Issuer”), in connection with the public offering and sale by the Issuer of $400,000,000 aggregate principal amount of 3.800% Senior Notes due 2029 (the “Senior Notes”) to be issued under the Indenture dated as of February 7, 2012 (the “Base Indenture”), among the Issuer, the Company, the Guarantors (as defined below) and The Bank of New York Mellon, as trustee (the “Trustee”), as supplemented by the Authorizing Resolution dated September 12, 2019 (the “Authorizing Resolution” and, together with the Base Indenture, the “Indenture”). The Senior Notes will be on the date hereof guaranteed (the “Guarantees”) by the entities set forth on Schedule I hereto (collectively, the “Delaware Guarantors”), by the entities set forth on Schedule II hereto (collectively, the “New York Guarantors” and, together with the Delaware Guarantors, the “Covered Guarantors”) and by the entities set forth on Schedule III hereto (the “Other Guarantors” and, together with the Covered Guarantors, the “Guarantors”).
In that connection, we have examined originals, or copies certified or otherwise identified to our satisfaction, of such documents, corporate records and other instruments as we have deemed necessary or appropriate for the purposes of this opinion, including: (a) the Certificate of Incorporation of the Issuer and the Company, as amended; (b) the By-laws of the Issuer and the Company, as amended; (c) the Certificate of Incorporation, By-laws or other comparable organizational documents, as the case may be, of each other Covered Guarantor; (d) the Omnibus Written Consent of (i) all of the members of the boards of directors of the corporations listed on Schedule I thereto and (ii) the person or persons authorized to act (whether directly or indirectly through a Guarantor) with regard thereto on behalf of one or more of the entities listed on Schedule II thereto, in each case duly adopted by unanimous consent on September 6, 2019; the Action Taken by Unanimous Written Consent of the Board of Directors of the Issuer, duly adopted on September 6, 2019; the Public Debt and Equity Securities Committee Charter of the
Board of Directors of the Company, duly adopted on June 7, 2009; the resolutions of the Public Debt and Equity Securities Committee of the Company, duly adopted on September 6, 2019; the Pricing Resolutions of the Committee Appointed by the Public Debt and Equity Securities Committee of the Board of Directors of the Company, duly adopted on September 9, 2019; the Pricing Resolutions of the Board of Directors of the Issuer, duly adopted on September 9, 2019; and the Joint Action of the Persons Authorized to Act on Behalf of each of the Issuer, the Company and the Guarantors, duly adopted on September 12, 2019, pursuant to which the Authorizing Resolution was adopted; (e) the Registration Statement on Form S-3 (Registration No. 333-222996) filed with the Securities and Exchange Commission (the “Commission”) on February 12, 2018, as amended by Post-Effective Amendment No. 1 thereto on September 9, 2019 (the “Registration Statement”), for registration under the Securities Act of 1933, as amended (the “Securities Act”), of an unlimited aggregate amount of various securities of the Company, the Issuer or certain other subsidiaries of the Company, to be issued from time to time by the Company, the Issuer or such subsidiaries; (f) the related Prospectus dated February 12, 2018 (together with the documents incorporated therein by reference, the “Basic Prospectus”); (g) the Prospectus Supplement dated September 9, 2019, filed with the Commission pursuant to Rule 424(b) of the General Rules and Regulations under the Securities Act (together with the Basic Prospectus and the documents incorporated by reference therein, the “Prospectus”); (h) the Pricing Term Sheet dated September 9, 2019, filed with the Commission pursuant to Rule 433 of the General Rules and Regulations under the Securities Act; (i) the Underwriting Agreement dated September 9, 2019 (the “Underwriting Agreement”), among the Issuer, the Company and BofA Securities, Inc., Citigroup Global Markets Inc., Goldman Sachs & Co. LLC, Mizuho Securities USA LLC, PNC Capital Markets LLC, SunTrust Robinson Humphrey, Inc. and Wells Fargo Securities, LLC, as representatives of the several underwriters names therein; and (j) the Indenture (including the First through Twentieth Supplemental Indentures thereof) and the forms of the Senior Notes and Guarantees.
As to various questions of fact material to this opinion, we have relied upon representations of officers or directors of the Issuer and the Company and documents furnished to us by the Issuer and the Company without independent verification of their accuracy. We have also assumed (a) with your consent and without independent investigation or verification, the genuineness of all signatures, the legal capacity and competency of all natural persons, the authenticity of all documents submitted to us as originals and the conformity to authentic original documents of all documents submitted to us as duplicates or copies, (b) that the Indenture has been duly authorized, executed and delivered by, and represents a legal, valid and binding obligation of, the Trustee and (c) that the Guarantees have been duly authorized, executed and delivered by each of the Other Guarantors.
Based on the foregoing and subject to the qualifications set forth herein, we are of opinion that, when the Senior Notes are authenticated in accordance with the provisions of the Indenture and delivered and paid for, (i) the Senior Notes will constitute legal, valid and binding obligations of the Issuer, enforceable against the Issuer in accordance with their terms and entitled to the benefits of the Indenture (subject to applicable bankruptcy, insolvency, reorganization, moratorium, fraudulent transfer and other similar
2
laws affecting creditors’ rights generally from time to time in effect and to general principles of equity, including, without limitation, concepts of materiality, reasonableness, good faith and fair dealing, regardless of whether considered in a proceeding in equity or at law) and (ii) the Guarantees will constitute legal, valid and binding obligations of the Guarantors entitled to the benefits of the Guarantees and enforceable against the Guarantors in accordance with their terms (subject to applicable bankruptcy, insolvency, reorganization, moratorium, fraudulent transfer and other similar laws affecting creditors’ rights generally from time to time in effect and to general principles of equity, including, without limitation, concepts of materiality, reasonableness, good faith and fair dealing, regardless of whether considered in a proceeding in equity or at law).
We are admitted to practice in the State of New York, and we express no opinion as to matters governed by any laws other than the laws of the State of New York, the Delaware General Corporation Law, the Delaware Revised Uniform Limited Partnership Act, the Delaware Limited Liability Company Act and the Federal laws of the United States of America.
We hereby consent to the filing of this opinion with the Commission as an exhibit to the Registration Statement. We also consent to the reference to our firm under the caption “Legal Matters” in the prospectus supplement forming a part of the Registration Statement. In giving this consent, we do not thereby admit that we are included in the category of persons whose consent is required under Section 7 of the Securities Act or the rules and regulations of the Commission.
| Very truly yours, |
| /s/ Cravath, Swaine & Moore LLP |
Toll Brothers, Inc.
250 Gibraltar Road
Horsham, Pennsylvania 19044
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Schedule I – Delaware Guarantors
| 134 Bay Street LLC | Toll MA Holdings LLC | |
| Ashford Land Company, L.P. | Toll MA Land II GP LLC | |
| Byers Commercial LLC | Toll Mid-Atlantic II LLC | |
| Component Systems I LLC | Toll Mid-Atlantic LP Company, Inc. | |
| Component Systems II LLC | Toll Mid-Atlantic V Corp. | |
| Dominion III Corp. | Toll Midwest LLC | |
| ESE Consultants, Inc. | Toll Morgan Street LLC | |
| First Brandywine Investment Corp. II | Toll NJX-I Corp. | |
| First Brandywine Investment Corp. IV | Toll Northeast II LLC | |
| First Brandywine LLC I | Toll Northeast LP Company, Inc. | |
| First Brandywine LLC II | Toll Northeast Services, Inc. | |
| First Brandywine Partners, L.P. | Toll Northeast V Corp. | |
| First Huntingdon Finance Corp. | Toll Northeast VIII LLC | |
| Hoboken Land I LLC | Toll Realty Holdings Corp. I | |
| Hockessin Chase, L.P. | Toll Realty Holdings Corp. II | |
| Liseter, LLC | Toll Realty Holdings LP | |
| Morgan Street JV LLC | Toll Southeast II LLC | |
| Plum Canyon Master LLC | Toll Southeast Inc. | |
| PRD Investors, Inc. | Toll Southeast LP Company, Inc. | |
| PRD Investors, LLC | Toll Southwest II LLC | |
| Rancho Costera LLC | Toll Southwest LLC | |
| Shapell Hold Properties No. 1, LLC | Toll VA GP Corp. | |
| Shapell Homes, Inc. | Toll VA LLC | |
| Shapell Industries, Inc. | Toll VA Member Two, Inc. | |
| Shapell Land Company, LLC | Toll West Coast II LLC | |
| TB Kent Partners LLC | Toll West Coast LLC | |
| TB Proprietary Corp. | Toll West Inc. | |
| Toll Architecture I, P.A. | Upper K Investors, Inc. | |
| Toll Architecture, Inc. | Upper K Investors, LLC | |
| Toll Brothers Canada USA, Inc. | Upper K-Shapell, LLC | |
| Toll Brothers, Inc. | ||
| Toll CA Holdings, Inc. | ||
| Toll Centennial Corp. | ||
| Toll Corners LLC | ||
| Toll Corp. | ||
| Toll DE II LP | ||
| Toll DE LP | ||
| Toll Diamond Corp. | ||
| Toll EB, LLC | ||
| Toll Equipment, L.L.C. | ||
| Toll Golden Corp. | ||
| Toll Hoboken LLC | ||
| Toll Holdings, Inc. | ||
| Toll Land Corp. No. 50 |
Schedule II – New York Guarantors
| 110-112 Third Ave. Realty Corp. 89 Park Avenue LLC |
| LL Parcel E, LLC |
| Toll at Whippoorwill, L.P. |
| Toll Brooklyn L.P. |
| Toll Land V Limited Partnership |
| Toll Land VI Limited Partnership |
| Toll Land VII LLC |
| Toll Lexington LLC |
| Toll NY II LLC |
| Toll NY III L.P. |
| Toll NY IV L.P. |
| Toll NY L.P. |
| Toll NY V L.P. |
| Toll Van Wyck, LLC |
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Schedule III – Other Guarantors
| Toll Bros. of Arizona, Inc. |
Frenchman’s Reserve Realty, LLC | |
| Toll Brothers AZ Construction Company |
Jacksonville TBI Realty LLC | |
| Toll Brothers AZ Limited Partnership |
Mizner Realty, L.L.C. | |
| Toll Prasada LLC |
Naples TBI Realty, LLC | |
| Arbors Porter Ranch, LLC |
Orlando TBI Realty LLC | |
| Placentia Development Company, LLC |
Tampa TBI Realty LLC | |
| Porter Ranch Development Co. |
TBI/Palm Beach Limited Partnership | |
| Sorrento at Dublin Ranch I LP |
Toll Estero Limited Partnership | |
| Sorrento at Dublin Ranch III LP |
Toll FL I, LLC | |
| Toll CA I LLC |
Toll FL II Limited Partnership | |
| Toll CA II, L.P. |
Toll FL III Limited Partnership | |
| Toll CA III LLC |
Toll FL IV Limited Partnership | |
| Toll CA III, L.P. |
Toll FL IV LLC | |
| Toll CA IV, L.P. |
Toll FL Limited Partnership | |
| Toll CA IX, L.P. |
Toll FL V Limited Partnership | |
| Toll CA Note II LLC |
Toll FL V LLC | |
| Toll CA V, L.P. |
Toll FL VI Limited Partnership | |
| Toll CA VI, L.P. |
Toll FL VII Limited Partnership | |
| Toll CA VII, L.P. |
Toll FL VIII Limited Partnership | |
| Toll CA VIII, L.P. |
Toll FL X Limited Partnership | |
| Toll CA X, L.P. |
Toll FL XII Limited Partnership | |
| Toll CA XI, L.P. |
Toll FL XIII Limited Partnership | |
| Toll CA XII, L.P. |
Toll Ft. Myers Limited Partnership | |
| Toll CA XIX, L.P. |
Toll Jacksonville Limited Partnership | |
| Toll CA XX, L.P. |
Toll Jupiter LLC | |
| Toll CA, L.P. |
Toll Orlando Limited Partnership | |
| Toll Land XIX Limited Partnership |
Toll GA LP | |
| Toll Land XX Limited Partnership |
Toll ID I LLC | |
| Toll Land XXII Limited Partnership |
Toll IL HWCC, L.P. | |
| Toll Land XXIII Limited Partnership |
Toll IL II, L.P. | |
| Toll Stonebrae LP |
Toll IL III, L.P. | |
| Toll YL II, L.P. |
Toll IL IV, L.P. | |
| Toll-Dublin, L.P. |
Toll IL WSB, L.P. | |
| Toll-Dublin, LLC |
Toll IL, L.P. | |
| Toll CO I LLC |
Toll IN LLC | |
| Toll CO II, L.P. |
CC Estates Limited Partnership | |
| Toll CO III, L.P. |
The Bird Estate Limited Partnership | |
| Toll CO, L.P. |
Toll MA Development LLC | |
| Southport Landing Limited Partnership |
Toll MA I LLC | |
| Toll CT II Limited Partnership |
Toll MA II LLC | |
| Toll CT III Limited Partnership |
Toll MA III LLC | |
| Toll CT IV Limited Partnership |
Toll MA IV LLC | |
| Toll CT Limited Partnership |
Toll MA Land III Limited Partnership | |
| Toll Glastonbury LLC |
Toll MA Land Limited Partnership | |
| Toll Land XVIII Limited Partnership |
Toll MA Management LLC | |
| Binks Estates Limited Partnership |
Long Meadows TBI, LLC |
3
| Toll MD AF Limited Partnership |
Block 255 LLC | |
| Toll MD I, L.L.C. |
Block 268 LLC | |
| Toll MD II Limited Partnership |
CWG Construction Company LLC | |
| Toll MD II LLC |
Enclave at Long Valley I LLC | |
| Toll MD III Limited Partnership |
Enclave at Long Valley II LLC | |
| Toll MD III LLC |
Estates at Princeton Junction, L.P. | |
| Toll MD IV Limited Partnership |
Hoboken Cove LLC | |
| Toll MD IV LLC |
Hoboken Land LP | |
| Toll MD IX Limited Partnership |
Laurel Creek, L.P. | |
| Toll MD Limited Partnership |
PT Maxwell Holdings, LLC | |
| Toll MD V Limited Partnership |
PT Maxwell, L.L.C. | |
| Toll MD VI Limited Partnership |
Regency at Denville, LLC | |
| Toll MD VII Limited Partnership |
Regency at Washington I LLC | |
| Toll MD VIII Limited Partnership |
Regency at Washington II LLC | |
| Toll MD X Limited Partnership |
Toll at Westlake, L.P. | |
| Toll MD XI Limited Partnership |
Toll Grove LP | |
| Arbor Hills Development LLC |
Toll Hudson LP | |
| HQZ Acquisitions, Inc. |
Toll Land IV Limited Partnership | |
| Silverman-Toll Limited Partnership |
Toll Land XI Limited Partnership | |
| The Silverman Building Companies, Inc. |
Toll Land XVI Limited Partnership | |
| Toll MI II Limited Partnership |
Toll Land XXV Limited Partnership | |
| Toll MI III Limited Partnership |
Toll NJ I, L.L.C. | |
| Toll MI IV Limited Partnership |
Toll NJ II, L.L.C. | |
| Toll MI Limited Partnership |
Toll NJ II, L.P. | |
| Toll MI V Limited Partnership |
Toll NJ III, L.P. | |
| Toll MI VI Limited Partnership |
Toll NJ III, LLC | |
| Toll MI VII Corp. |
Toll NJ IV LLC | |
| Toll MN II, L.P. |
Toll NJ IV, L.P. | |
| Toll MN, L.P. |
Toll NJ VI, L.P. | |
| Brier Creek Country Club I LLC |
Toll NJ VII, L.P. | |
| Brier Creek Country Club II LLC |
Toll NJ VIII, L.P. | |
| NC Country Club Estates Limited Partnership |
Toll NJ XI, L.P. | |
| Toll at Brier Creek Limited Partnership |
Toll NJ XII LP | |
| Toll Bros. of North Carolina II, Inc. |
Toll NJ, L.P. | |
| Toll Bros. of North Carolina, Inc. |
Toll Port Imperial LLC | |
| Toll NC I LLC |
Coleman-Toll Limited Partnership | |
| Toll NC II LP |
Toll Henderson LLC | |
| Toll NC III LP |
Toll North LV LLC | |
| Toll NC IV LLC |
Toll North Reno LLC | |
| Toll NC Note II LLC |
Toll NV GP Corp. | |
| Toll NC Note LLC |
Toll NV GP I LLC | |
| Toll NC, L.P. |
Toll NV Holdings LLC | |
| 126-142 Morgan Street Urban Renewal LLC |
Toll NV Limited Partnership | |
| 1400 Hudson LLC |
Toll South LV LLC | |
| 1450 Washington LLC |
Toll South Reno LLC | |
| 1451 Hudson LLC |
Toll Sparks LLC | |
| 1500 Garden St. LLC |
Toll SW Holding I Corp. | |
| 700 Grove Street Urban Renewal LLC |
Toll SW Holding LLC |
4
| Audubon Ridge, L.P. |
Toll Dallas TX LLC | |
| Broad Run Associates, L.P. |
Toll Houston Land LLC | |
| Byers Commercial LP |
Toll Houston TX LLC | |
| Cold Spring Hunt, L.P. |
Toll San Antonio TX LLC | |
| Goshen Road Land Company LLC |
Toll TX Note LLC | |
| Greens at Waynesborough, L.P. |
Belmont Country Club I LLC | |
| Hatboro Road Associates LLC |
Belmont Country Club II LLC | |
| Liseter Land Company LLC |
Belmont Land, L.P. | |
| Springton Pointe, L.P. |
Dominion Country Club, L.P. | |
| Stone Mill Estates, L.P. |
Dominion Valley Country Club I LLC | |
| Swedesford Chase, L.P. |
Dominion Valley Country Club II LLC | |
| Toll Bros., Inc. |
Fairfax Investment, L.P. | |
| Toll Brothers Real Estate, Inc. |
Loudoun Valley Associates, L.P. | |
| Toll Naval Associates |
Martinsburg Ventures, L.L.C. | |
| Toll PA Development LP |
Regency at Dominion Valley LLC | |
| Toll PA II, L.P. |
South Riding Amberlea LP | |
| Toll PA III, L.P. |
South Riding Partners Amberlea LP | |
| Toll PA IV, L.P. |
South Riding Partners, L.P. | |
| Toll PA IX, L.P. |
South Riding Realty LLC | |
| Toll PA Management LP |
South Riding, L.P. | |
| Toll PA Twin Lakes LLC |
SR Amberlea LLC | |
| Toll PA V, L.P. |
SRLP II LLC | |
| Toll PA VI, L.P. |
The Regency Golf Club I LLC | |
| Toll PA VIII, L.P. |
The Regency Golf Club II LLC | |
| Toll PA X, L.P. |
Toll Cedar Hunt LLC | |
| Toll PA XI, L.P. |
Toll Land IX Limited Partnership | |
| Toll PA XII, L.P. |
Toll Land X Limited Partnership | |
| Toll PA XIII, L.P. |
Toll Land XV Limited Partnership | |
| Toll PA XIV, L.P. |
Toll Land XXI Limited Partnership | |
| Toll PA XIX, L.P. |
Toll Stratford LLC | |
| Toll PA XV, L.P. |
Toll VA II, L.P. | |
| Toll PA XVI, L.P. |
Toll VA III, L.L.C. | |
| Toll PA XVII, L.P. |
Toll VA III, L.P. | |
| Toll PA XVIII, L.P. |
Toll VA IV, L.P. | |
| Toll PA, L.P. |
Toll VA V, L.P. | |
| Toll RI II, L.P. |
Toll VA VI, L.P. | |
| Toll RI, L.P. |
Toll VA VII, L.P. | |
| Toll Vanderbilt II LLC |
Toll VA VIII, L.P. | |
| Vanderbilt Capital, LLC |
Toll VA, L.P. | |
| Toll SC II, L.P. |
Virginia Construction Co. I, LLC | |
| Toll SC III, L.P. |
Virginia Construction Co. II, LLC | |
| Toll SC IV, L.P. |
Toll WV GP Corp. | |
| Toll SC, L.P. |
Toll WV LP | |
| Toll Austin TX II LLC |
||
| Toll Austin TX III LLC |
||
| Toll Austin TX LLC |
||
| Toll BBC II LLC |
||
| Toll BBC LLC |
5
Exhibit 5.2
[TOLL BROTHERS LETTERHEAD]
September 12, 2019
Toll Brothers, Inc.
250 Gibraltar Road
Horsham, PA 19044
Ladies and Gentlemen:
I am Senior Vice President, Chief Compliance Officer and General Counsel of Toll Brothers, Inc., a Delaware corporation (“TBI”). TBI, Toll Brothers Finance Corp., a Delaware corporation and a wholly-owned subsidiary of TBI (“the Issuer”) and certain other subsidiaries of TBI (the “Subsidiary Registrants”) have filed a Registration Statement on Form S-3 (File No. 333-222996) (the “Registration Statement”) with the Securities and Exchange Commission (the “Commission”) under the Securities Act of 1933, as amended (the “Securities Act”), pursuant to which the Issuer is issuing $400 million in aggregate principal of 3.800% Senior Notes due 2029 (the “Senior Notes”). The Senior Notes are unconditionally guaranteed (each a “Senior Note Guarantee” and, collectively, the “Senior Notes Guarantees”) on a senior basis by TBI and the Subsidiary Registrants (together, in such capacity, the “Senior Notes Guarantors”), pursuant to the Underwriting Agreement dated September 9, 2019, among TBI, the Issuer and the underwriters named therein (the “Underwriting Agreement”).
I have examined the Registration Statement as it became effective under the Securities Act; TBI’s and the Issuer’s prospectus dated February 12, 2018 (the “Base Prospectus”), as supplemented by the prospectus supplement relating to the offering of the Senior Notes dated September 9, 2019 (together with the Base Prospectus, the “Senior Notes Prospectus”), filed by TBI and the Issuer pursuant to Rule 424(b) of the rules and regulations of the Commission under the Securities; the indenture dated as of February 7, 2012 (the “Base Indenture”) among the Issuer, the Senior Notes Guarantors and The Bank of New York Mellon, as trustee (the “Trustee”), as supplemented by the Authorizing Resolution with respect to the Senior Notes dated as of September 12, 2019 (the “Authorizing Resolution” and, together with the Base Indenture, the “Indenture”); a duplicate of the global note representing the Senior Notes (including the guarantee attached thereto); and the Underwriting Agreement.
In rendering the opinions contained herein, I have relied upon my examination or the examination by members of our legal staff or outside counsel (in the ordinary course of business) of the original or copies certified or otherwise identified to our satisfaction of the charter, bylaws or other governing documents of the subsidiaries named in Schedule I hereto (the “Schedule I Subsidiaries”), resolutions and written consents of their respective boards of directors, general partners, managers and managing members, as the case may be, statements and certificates from officers of the Schedule I Subsidiaries and, to the extent obtained, from various state authorities, status telecopies provided by Corporation Service Company, and such other documents and records relating to the Schedule I Subsidiaries as we have deemed appropriate. I, or a member of my staff, have also examined the originals, or duplicates or certified or conformed copies, of
such corporate and other records, agreements, documents and other instruments of all the registrants and have made such other investigations as I have deemed relevant and necessary in connection with the opinions hereinafter set forth. As to questions of fact material to this opinion, I have relied upon certificates or comparable documents or statements of public officials and of officers and representatives of TBI, the Issuer and the Schedule I Subsidiaries.
In rendering the opinions set forth below, I have also assumed the genuineness of all signatures, the legal capacity and competency of all natural persons, the authenticity of all documents submitted to me as originals, the conformity to original documents of all documents submitted to me as duplicates or certified or conformed copies and the authenticity of the originals of such latter documents.
Based upon the foregoing, and subject to the qualifications, assumptions and limitations stated herein, I am of the opinion that the Senior Notes Guarantees have been duly authorized, executed and delivered by each of the Schedule I Subsidiaries.
This opinion letter is given as of the date hereof and I assume no obligation to update or supplement this opinion letter to reflect any facts or circumstances that may hereafter come to my attention or any change in laws that may hereafter occur.
I hereby consent to the filing of this opinion letter as Exhibit 5.2 to the Current Report on Form 8-K of TBI filed with the Commission in connection with the registration of the Senior Notes.
[Remainder of this page intentionally left blank]
| Very truly yours, |
| /s/ John McDonald |
| John McDonald |
| Senior Vice President, |
| Chief Compliance Officer and General Counsel |
Schedule I
| 110-112 Third Ave. Realty Corp. | First Huntingdon Finance Corp. | |
| 126-142 Morgan Street Urban Renewal LLC | Frenchman’s Reserve Realty, LLC Goshen Road Land Company LLC | |
| 134 Bay Street LLC | Greens at Waynesborough, L.P. | |
| 1400 Hudson LLC | Hatboro Road Associates LLC | |
| 1450 Washington LLC | Hoboken Cove LLC | |
| 1451 Hudson LLC | Hoboken Land I LLC | |
| 1500 Garden St. LLC | Hoboken Land LP | |
| 700 Grove Street Urban Renewal LLC | Hockessin Chase, L.P. | |
| 89 Park Avenue LLC | HQZ Acquisitions, Inc. | |
| Arbor Hills Development LLC | Jacksonville TBI Realty LLC | |
| Arbors Porter Ranch, LLC | Laurel Creek, L.P. | |
| Ashford Land Company, L.P. | Liseter Land Company LLC | |
| Audubon Ridge, L.P. | Liseter, LLC | |
| Belmont Country Club I LLC | LL Parcel E, LLC | |
| Belmont Country Club II LLC | Long Meadows TBI, LLC | |
| Belmont Land, L.P. | Loudoun Valley Associates, L.P. | |
| Binks Estates Limited Partnership | Martinsburg Ventures, L.L.C. | |
| Block 255 LLC | Mizner Realty, L.L.C. | |
| Block 268 LLC | Morgan Street JV LLC | |
| Brier Creek Country Club I LLC | Naples TBI Realty, LLC | |
| Brier Creek Country Club II LLC | NC Country Club Estates Limited | |
| Broad Run Associates, L.P. | Partnership | |
| Byers Commercial LLC | Orlando TBI Realty LLC | |
| Byers Commercial LP | Placentia Development Company, LLC | |
| CC Estates Limited Partnership | Plum Canyon Master LLC | |
| Cold Spring Hunt, L.P. | Porter Ranch Development Co. | |
| Coleman-Toll Limited Partnership | PRD Investors, Inc. | |
| Component Systems I LLC | PRD Investors, LLC | |
| Component Systems II LLC | PT Maxwell Holdings, LLC | |
| CWG Construction Company LLC | PT Maxwell, L.L.C. | |
| Dominion Country Club, L.P. | Rancho Costera LLC | |
| Dominion III Corp. | Regency at Denville, LLC | |
| Dominion Valley Country Club I LLC | Regency at Dominion Valley LLC | |
| Dominion Valley Country Club II LLC | Regency at Washington I LLC | |
| Enclave at Long Valley I LLC | Regency at Washington II LLC | |
| Enclave at Long Valley II LLC | Shapell Hold Properties No. 1, LLC | |
| ESE Consultants, Inc. | Shapell Homes, Inc. | |
| Estates at Princeton Junction, L.P. | Shapell Industries, Inc. | |
| Fairfax Investment, L.P. | Shapell Land Company, LLC | |
| First Brandywine Investment Corp. II | Silverman-Toll Limited Partnership | |
| First Brandywine Investment Corp. IV | Sorrento at Dublin Ranch I LP | |
| First Brandywine LLC I | Sorrento at Dublin Ranch III LP | |
| First Brandywine LLC II | South Riding Amberlea LP | |
| First Brandywine Partners, L.P. | South Riding Partners Amberlea LP |
| South Riding Partners, L.P. | Toll CA VII, L.P. | |
| South Riding Realty LLC | Toll CA VIII, L.P. | |
| South Riding, L.P. | Toll CA X, L.P. | |
| Southport Landing Limited Partnership | Toll CA XI, L.P. | |
| Springton Pointe, L.P. | Toll CA XII, L.P. | |
| SR Amberlea LLC | Toll CA XIX, L.P. | |
| SRLP II LLC | Toll CA XX, L.P. | |
| Stone Mill Estates, L.P. | Toll CA, L.P. | |
| Swedesford Chase, L.P. | Toll Cedar Hunt LLC | |
| Tampa TBI Realty LLC | Toll Centennial Corp. | |
| TB Kent Partners LLC | Toll CO I LLC | |
| TB Proprietary Corp. | Toll CO II, L.P. | |
| TBI/Palm Beach Limited Partnership | Toll CO III, L.P. | |
| The Bird Estate Limited Partnership | Toll CO, L.P. | |
| The Regency Golf Club I LLC | Toll Corners LLC | |
| The Regency Golf Club II LLC | Toll Corp. | |
| The Silverman Building Companies, Inc. | Toll CT II Limited Partnership | |
| Toll Architecture I, P.A. | Toll CT III Limited Partnership | |
| Toll Architecture, Inc. | Toll CT IV Limited Partnership | |
| Toll at Brier Creek Limited Partnership | Toll CT Limited Partnership | |
| Toll at Westlake, L.P. | Toll Dallas TX LLC | |
| Toll at Whippoorwill, L.P. | Toll DE II LP | |
| Toll Austin TX II LLC | Toll DE LP | |
| Toll Austin TX III LLC | Toll Diamond Corp. | |
| Toll Austin TX LLC | Toll EB, LLC | |
| Toll BBC II LLC | Toll Equipment, L.L.C. | |
| Toll BBC LLC | Toll Estero Limited Partnership | |
| Toll Brooklyn L.P. | Toll FL I, LLC | |
| Toll Bros. of Arizona, Inc. | Toll FL II Limited Partnership | |
| Toll Bros. of North Carolina II, Inc. | Toll FL III Limited Partnership | |
| Toll Bros. of North Carolina, Inc. | Toll FL IV Limited Partnership | |
| Toll Bros., Inc. | Toll FL IV LLC | |
| Toll Brothers AZ Construction Company | Toll FL Limited Partnership | |
| Toll Brothers AZ Limited Partnership | Toll FL V Limited Partnership | |
| Toll Brothers Canada USA, Inc. | Toll FL V LLC | |
| Toll Brothers Real Estate, Inc. | Toll FL VI Limited Partnership | |
| Toll CA Holdings, Inc. | Toll FL VII Limited Partnership | |
| Toll CA I LLC | Toll FL VIII Limited Partnership | |
| Toll CA II, L.P. | Toll FL X Limited Partnership | |
| Toll CA III LLC | Toll FL XII Limited Partnership | |
| Toll CA III, L.P. | Toll FL XIII Limited Partnership | |
| Toll CA IV, L.P. | Toll Ft. Myers Limited Partnership | |
| Toll CA IX, L.P. | Toll GA LP | |
| Toll CA Note II LLC | Toll Glastonbury LLC | |
| Toll CA V, L.P. | Toll Golden Corp. | |
| Toll CA VI, L.P. | Toll Grove LP |
| Toll Henderson LLC | Toll MD II Limited Partnership | |
| Toll Hoboken LLC | Toll MD II LLC | |
| Toll Holdings, Inc. | Toll MD III Limited Partnership | |
| Toll Houston Land LLC | Toll MD III LLC | |
| Toll Houston TX LLC | Toll MD IV Limited Partnership | |
| Toll Hudson LP | Toll MD IV LLC | |
| Toll ID I LLC | Toll MD IX Limited Partnership | |
| Toll IL HWCC, L.P. | Toll MD Limited Partnership | |
| Toll IL II, L.P. | Toll MD V Limited Partnership | |
| Toll IL III, L.P. | Toll MD VI Limited Partnership | |
| Toll IL IV, L.P. | Toll MD VII Limited Partnership | |
| Toll IL WSB, L.P. | Toll MD VIII Limited Partnership | |
| Toll IL, L.P. | Toll MD X Limited Partnership | |
| Toll IN LLC | Toll MD XI Limited Partnership | |
| Toll Jacksonville Limited Partnership | Toll MI II Limited Partnership | |
| Toll Jupiter LLC | Toll MI III Limited Partnership | |
| Toll Land Corp. No. 50 | Toll MI IV Limited Partnership | |
| Toll Land IV Limited Partnership | Toll MI Limited Partnership | |
| Toll Land IX Limited Partnership | Toll MI V Limited Partnership | |
| Toll Land V Limited Partnership | Toll MI VI Limited Partnership | |
| Toll Land VI Limited Partnership | Toll MI VII Corp. | |
| Toll Land VII LLC | Toll Mid-Atlantic II LLC | |
| Toll Land X Limited Partnership | Toll Mid-Atlantic V Corp. | |
| Toll Land XI Limited Partnership | Toll Mid-Atlantic LP Company, Inc. | |
| Toll Land XIX Limited Partnership | Toll Midwest LLC | |
| Toll Land XV Limited Partnership | Toll MN II, L.P. | |
| Toll Land XVI Limited Partnership | Toll MN, L.P. | |
| Toll Land XVIII Limited Partnership | Toll Morgan Street LLC | |
| Toll Land XX Limited Partnership | Toll Naval Associates | |
| Toll Land XXI Limited Partnership | Toll NC I LLC | |
| Toll Land XXII Limited Partnership | Toll NC II LP | |
| Toll Land XXIII Limited Partnership | Toll NC III LP | |
| Toll Land XXV Limited Partnership | Toll NC IV LLC | |
| Toll Lexington LLC | Toll NC Note II LLC | |
| Toll MA Development LLC | Toll NC Note LLC | |
| Toll MA Holdings LLC | Toll NC, L.P. | |
| Toll MA I LLC | Toll NJ I, L.L.C. | |
| Toll MA II LLC | Toll NJ II, L.L.C. | |
| Toll MA III LLC | Toll NJ II, L.P. | |
| Toll MA IV LLC | Toll NJ III, L.P. | |
| Toll MA Land II GP LLC | Toll NJ III, LLC | |
| Toll MA Land III Limited Partnership | Toll NJ IV LLC | |
| Toll MA Land Limited Partnership | Toll NJ IV, L.P. | |
| Toll MA Management LLC | Toll NJ VI, L.P. | |
| Toll MD AF Limited Partnership | Toll NJ VII, L.P. | |
| Toll MD I, L.L.C. | Toll NJ VIII, L.P. |
| Toll NJ XI, L.P. | Toll Realty Holdings LP | |
| Toll NJ XII LP | Toll RI II, L.P. | |
| Toll NJ, L.P. | Toll RI, L.P. | |
| Toll NJX-I Corp. | Toll San Antonio TX LLC | |
| Toll North LV LLC | Toll SC II, L.P. | |
| Toll North Reno LLC | Toll SC III, L.P. | |
| Toll Northeast II LLC | Toll SC IV, L.P. | |
| Toll Northeast V Corp. | Toll SC, L.P. | |
| Toll Northeast VIII LLC | Toll South LV LLC | |
| Toll Northeast LP Company, Inc. | Toll South Reno LLC | |
| Toll Northeast Services, Inc. | Toll Southeast II LLC | |
| Toll NV GP Corp. | Toll Southeast Inc. | |
| Toll NV GP I LLC | Toll Southeast LP Company, Inc. | |
| Toll NV Holdings LLC | Toll Southwest II LLC | |
| Toll NV Limited Partnership | Toll Southwest LLC | |
| Toll NY II LLC | Toll Sparks LLC | |
| Toll NY III L.P. | Toll Stonebrae LP | |
| Toll NY IV L.P. | Toll Stratford LLC | |
| Toll NY L.P. | Toll SW Holding I Corp. | |
| Toll NY V L.P. | Toll SW Holding LLC | |
| Toll Orlando Limited Partnership | Toll TX Note LLC | |
| Toll PA Development LP | Toll VA GP Corp. | |
| Toll PA II, L.P. | Toll VA II, L.P. | |
| Toll PA III, L.P. | Toll VA III, L.L.C. | |
| Toll PA IV, L.P. | Toll VA III, L.P. | |
| Toll PA IX, L.P. | Toll VA IV, L.P. | |
| Toll PA Management LP | Toll VA LLC | |
| Toll PA Twin Lakes LLC | Toll VA Member Two, Inc. | |
| Toll PA V, L.P. | Toll VA V, L.P. | |
| Toll PA VI, L.P. | Toll VA VI, L.P. | |
| Toll PA VIII, L.P. | Toll VA VII, L.P. | |
| Toll PA X, L.P. | Toll VA VIII, L.P. | |
| Toll PA XI, L.P. | Toll VA, L.P. | |
| Toll PA XII, L.P. | Toll Van Wyck, LLC | |
| Toll PA XIII, L.P. | Toll Vanderbilt II LLC | |
| Toll PA XIV, L.P. | Toll West Coast II LLC | |
| Toll PA XIX, L.P. | Toll West Coast LLC | |
| Toll PA XV, L.P. | Toll West Inc. | |
| Toll PA XVI, L.P. | Toll WV GP Corp. | |
| Toll PA XVII, L.P. | Toll WV LP | |
| Toll PA XVIII, L.P. | Toll YL II, L.P. | |
| Toll PA, L.P. | Toll-Dublin, L.P. | |
| Toll Port Imperial LLC | Toll-Dublin, LLC | |
| Toll Prasada LLC | Upper K Investors, Inc. | |
| Toll Realty Holdings Corp. I | Upper K Investors, LLC | |
| Toll Realty Holdings Corp. II | Upper K-Shapell, LLC | |
| Vanderbilt Capital, LLC | ||
| Virginia Construction Co. I, LLC | ||
| Virginia Construction Co. II, LLC |