By William Gullotti
Buffalo, N.Y., July 18 – Landsea Homes Corp. entered a $250 million note purchase agreement with U.S. Bank Trust Co., NA as agent on Monday, according to an 8-K filing with the Securities and Exchange Commission.
The agreement covers a $250 million private placement of 11% senior notes due July 17, 2028 that will be guaranteed, jointly and severally, on a senior unsecured basis, by most of the company’s subsidiaries.
The notes will be callable in whole, or in part, at the issuer’s option with a varying payout. On or prior to July 17, 2025, the notes will be redeemable with a make-whole premium calculated at Treasuries plus 50 basis points. After July 17, 2025 and through July 17, 2026, the notes will be callable at 107.33 plus accrued interest, stepping down to 103.67 for the next year and to par plus interest for the final year of the life of the notes.
Noteholders will be able to exercise a change-of-control put at 101 plus interest. They will also be able to exercise put rights at par under certain conditions including, but not limited to, incurring debt not permitted under the agreement or receiving net cash proceeds in excess of $15 million from asset dispositions.
Moelis & Co. has served as lead placement agent for the deal.
BlackRock Financial Management Inc. and Angelo, Gordon & Co., LP, along with multiple subsidiaries of each group, were the institutional investors.
Proceeds from the sale are intended to pay down a portion of the company’s outstanding borrowings under its revolving credit facility, for working capital and for general corporate purposes.
The homebuilder is based in Newport Beach, Calif.
| Issuer: | Landsea Homes Corp.
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| Amount: | $250 million
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| Issue: | Senior notes
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| Maturity: | July 17, 2028
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| Lead agent: | Moelis & Co.
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| Initial purchasers: | BlackRock Financial Management Inc. and Angelo, Gordon & Co., LP
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| Coupon: | 11%
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| Call: | In whole or in part at any time; make-whole at Treasuries plus 50 bps until July 17, 2025; at 107.33 plus interest until July 17, 2026; at 103.67 plus interest until July 17, 2027; at par thereafter
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| Puts: | At 101 plus interest for a change of control; at par plus interest under certain conditions including, but not limited to, incurring debt not permitted under the agreement or receiving net cash proceeds in excess of $15 million from asset dispositions
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| Agreement date: | July 17
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| Announcement date: | July 18
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| Distribution: | Private placement
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