"Management foresaw the need to increase the size of the facility to support the 20% average growth rate the company has attained since going public in 1996," explained Cooper. "Our old bank facility would have matured in March 2006 and we typically do not wait until the last minute to extend our facility," he added, explaining the timing behind the replacement. But he said Toll Brothers felt it was an attractive time to approach the loan market given solid bank appetite right now. He declined to provide pricing on the old and new facilities, though he described the price of the new revolver as "more attractive."
J.P. Morgan is the lead bank and sole bookrunner. Bank One, which led the last facility, is the administrative agent. He said Toll Brothers has had a relationship with Bank One for more than a decade. "NDB was in our line, NDB merged into First Chicago, First Chicago merged into Bank One, Bank One then merged into J.P. Morgan," he noted. The syndicate, meanwhile, has grown significantly, in line with the homebuilder market, he said. "As the public homebuilders have grown geographically and in size, the credit facilities have grown more attractive to a wider array of banks," Cooper added. "As Toll Brothers has diversified geographically, we look to attract banks with operations in the many markets we operate in."
New participants include Fifth Third Bank, HSBC Bank, Manufacturers and Traders Trust Company, Cathay United Bank and Bank of Communications. Lenders that stayed in from the old facility consist of Bank of America and Wachovia Securities as syndication agents; documentation agentThe Royal Bank of Scotland; BNP Paribas, Calyon and Comerica Bank are managing agents; Citigroup, Mizuho Corporate Bank, SunTrust Bank and Washington Mutual are co-agents; PNC Bank, Commerce Bank,The Norinchukin Bank, Wells Fargo Bank, Guaranty Bank, Mellon Bank and KBC Bank are also participants.