

	September 30,
	2019		2018
	(In millions)
Homebuilding:
Unsecured:
Revolving credit facility	$	—	$	—
3.75% senior notes due 2019 (1)	—		499.6
4.0% senior notes due 2020 (1)	499.6		498.8
2.55% senior notes due 2020 (1)	398.9		397.9
4.375% senior notes due 2022 (1)	348.8		348.4
4.75% senior notes due 2023 (1)	298.9		298.7
5.75% senior notes due 2023 (1)	398.4		398.0
Other secured notes	103.0		4.5
	2,047.6		2,445.9
Forestar:
Unsecured:
Revolving credit facility	—		—
3.75% convertible senior notes due 2020 (2)	119.1		119.9
8.0% senior notes due 2024 (3)	343.8		—
	462.9		119.9
Financial Services:
Mortgage repurchase facility	888.9		637.7
	$	3,399.4	$	3,203.5

As of September 30, 2019, maturities of consolidated notes payable, assuming the mortgage repurchase facility is not extended or renewed, are $1.6 billion in fiscal 2020, $403.3 million in fiscal 2021, $350.4 million in fiscal 2022, $700.4 million in fiscal 2023 and $351.5 million in fiscal 2024.

At September 30, 2019, the Company had a $1.325 billion senior unsecured homebuilding revolving credit facility with an uncommitted accordion feature that could increase the size of the facility to $1.9 billion, subject to certain conditions and availability of additional bank commitments. The facility also provided for the issuance of letters of credit with a sublimit equal to approximately 50% of the revolving credit commitment. Letters of credit issued under the facility reduce the available borrowing capacity. The interest rate on borrowings under the revolving credit facility may be based on either the Prime Rate or London Interbank Offered Rate (LIBOR) plus an applicable margin, as defined in the credit agreement governing the facility. At September 30, 2019, there were no borrowings outstanding and $141.2 million of letters of credit issued under the revolving credit facility, resulting in available capacity of approximately $1.2 billion. Borrowings and repayments under the facility totaled $2.1 billion each during fiscal 2019.

In October 2019, the homebuilding revolving credit facility was amended to increase its capacity to $1.59 billion with an uncommitted accordion feature that could increase the size of the facility to $2.5 billion, subject to certain conditions and availability of additional bank commitments. The amendment also extended the facility’s maturity date from September 25, 2023 to October 2, 2024 and increased the letter of credit sublimit to 100% of the revolving credit commitment.

The Company’s homebuilding revolving credit facility imposes restrictions on its operations and activities, including requiring the maintenance of a maximum allowable leverage ratio and a borrowing base restriction if the leverage ratio exceeds a certain level. These covenants are measured as defined in the credit agreement governing the facility and are reported to the lenders quarterly. A failure to comply with these financial covenants could allow the lending banks to terminate the availability of funds under the revolving credit facility or cause any outstanding borrowings to become due and payable prior to maturity. The credit agreement governing the facility and the indenture governing the senior notes also impose restrictions on the creation of secured debt and liens. At September 30, 2019, the Company was in compliance with all of the covenants, limitations and restrictions of its homebuilding revolving credit facility and public debt obligations.

D.R. Horton has an automatically effective universal shelf registration statement filed with the Securities and Exchange Commission (SEC) in August 2018, registering debt and equity securities that the Company may issue from time to time in amounts to be determined.

In March 2019, the Company repaid $500 million principal amount of its 3.75% senior notes at maturity. In October 2019, the Company issued $500 million principal amount of 2.5% senior notes due October 15, 2024, with interest payable semi-annually. The annual effective interest rate of these notes after giving effect to the amortization of the discount and financing costs is 2.7%.



Notes Payable	Principal Amount	Date Issued	Date Due	Redeemable Prior to Maturity (1)	Effective Interest Rate (2)
	(In millions)
4.0% senior notes	$500.0	February 2015	February 15, 2020	Yes	4.2%
2.55% senior notes	$400.0	December 2017	December 1, 2020	Yes	2.8%
4.375% senior notes	$350.0	September 2012	September 15, 2022	Yes	4.5%
4.75% senior notes	$300.0	February 2013	February 15, 2023	Yes	4.9%
5.75% senior notes	$400.0	August 2013	August 15, 2023	Yes	5.9%

All series of homebuilding senior notes and borrowings under the homebuilding revolving credit facility are senior obligations and rank pari passu in right of payment to all existing and future unsecured indebtedness and senior to all existing and future indebtedness expressly subordinated to them. The homebuilding senior notes and borrowings under the homebuilding revolving credit facility are guaranteed by entities that hold approximately 79% of the Company’s assets. Upon the occurrence of both a change of control of the Company and a ratings downgrade event, as defined in the indenture governing its senior notes, the Company would be required in certain circumstances to offer to repurchase these notes at 101% of their principal amount, along with accrued and unpaid interest. Also, a change of control as defined in the revolving credit facility would constitute an event of default under the revolving credit facility, which could result in the acceleration of any borrowings outstanding under the facility and the termination of the commitments thereunder.

Effective July 30, 2019, the Board of Directors authorized the repurchase of up to $500 million of the Company’s debt securities. The authorization has no expiration date. All of the $500 million authorization was remaining at September 30, 2019.

Forestar has a $380 million senior unsecured revolving credit facility with an uncommitted accordion feature that could increase the size of the facility to $570 million, subject to certain conditions and availability of additional bank commitments. The facility also provides for the issuance of letters of credit with a sublimit equal to the greater of $100 million and 50% of the revolving credit commitment. Letters of credit issued under the facility reduce the available borrowing capacity. At September 30, 2019, there were no borrowings outstanding and $29.7 million of letters of credit issued under the revolving credit facility. Borrowings under the revolving credit facility are subject to a borrowing base based on Forestar’s book value of its real estate assets and unrestricted cash. At September 30, 2019, the borrowing base limited the available capacity under the revolving credit facility to $339.6 million. Borrowings and repayments under the facility totaled $85 million each during fiscal 2019.

In October 2019, the Forestar revolving credit facility was amended to extend its maturity date from August 16, 2021 to October 2, 2022. The maturity date may be extended by up to one year on up to two additional occasions, subject to the approval of lenders holding a majority of the commitments.

The Forestar revolving credit facility includes customary affirmative and negative covenants, events of default and financial covenants. The financial covenants require Forestar to maintain a minimum level of tangible net worth, a minimum level of liquidity and a maximum allowable leverage ratio. These covenants are measured as defined in the credit agreement governing the facility and are reported to the lenders quarterly. A failure to comply with these financial covenants could allow the lending banks to terminate the availability of funds under the revolving credit facility or cause any outstanding borrowings to become due and payable prior to maturity. At September 30, 2019, Forestar was in compliance with all of the covenants, limitations and restrictions of its revolving credit facility.

At September 30, 2019, the principal amount of Forestar’s 3.75% convertible senior notes due March 2020 was $118.9 million. Forestar intends to settle the principal amount of these notes in cash at maturity, with any excess conversion value to be settled in shares of its common stock.

In April 2019, Forestar issued $350 million principal amount of 8.0% senior notes pursuant to Rule 144A and Regulation S under the Securities Act of 1933, as amended. The notes mature April 15, 2024, with interest payable semi-annually, and represent unsecured obligations of Forestar. The annual effective interest rate of these notes after giving effect to the amortization of financing costs is 8.5%. These notes may be redeemed prior to maturity, subject to certain limitations and premiums defined in the indenture agreement.

The Company’s mortgage subsidiary, DHI Mortgage, has a mortgage repurchase facility that provides financing and liquidity to DHI Mortgage by facilitating purchase transactions in which DHI Mortgage transfers eligible loans to the counterparties upon receipt of funds from the counterparties. DHI Mortgage then has the right and obligation to repurchase the purchased loans upon their sale to third-party purchasers in the secondary market or within specified time frames from 45 to 60 days in accordance with the terms of the mortgage repurchase facility. The total capacity of the facility is $900 million; however, the capacity increases, without requiring additional commitments, to $1.1 billion for approximately 45 days at fiscal year end. The capacity can also be increased to $1.2 billion subject to the availability of additional commitments. The maturity date of the facility is February 21, 2020.

As of September 30, 2019, $1.0 billion of mortgage loans held for sale with a collateral value of $972.0 million were pledged under the mortgage repurchase facility. DHI Mortgage had an obligation of $888.9 million outstanding under the mortgage repurchase facility at September 30, 2019 at a 3.7% annual interest rate.

The mortgage repurchase facility is not guaranteed by D.R. Horton, Inc. or any of the subsidiaries that guarantee the Company’s homebuilding debt. The facility contains financial covenants as to the mortgage subsidiary’s minimum required tangible net worth, its maximum allowable leverage ratio and its minimum required liquidity. These covenants are measured and reported to the lenders monthly. At September 30, 2019, DHI Mortgage was in compliance with all of the conditions and covenants of the mortgage repurchase facility.