Millrose Properties, Inc.

Previous wording

Millrose is a corporation incorporated under the laws of the State of Maryland on March 19, 2024. Our Company was formed in connection with the Spin-Off from Lennar to create an independent, publicly traded company that provides the HOPP’R to Lennar, Lennar Related Ventures and Other Customers. Millrose purchases and develops residential land and sells finished homesites back to homebuilders by way of option contracts with predetermined costs and takedown schedules. Millrose intends its “first of its kind” public vehicle to be attractive to homebuilders seeking to implement an asset-light strategy. As fully developed homesites are taken down by the homebuilder, capital is recycled into future land acquisitions for homebuilders, providing each customer with uninterrupted access to capital. Through our subsidiaries, we hold finished homesites with homes under construction, finished homesites imminently ready for construction, Land Under Development, land ready for development and land not yet ready for development. We are externally managed and advised by Kennedy Lewis Land and Residential Advisors LLC (“KL” or the “Manager”), pursuant to the Management Agreement between Millrose and KL entered into February 7, 2025 (the “Management Agreement”).

Current wording

Millrose is a corporation incorporated under the laws of the State of Maryland on March 19, 2024. Our Company was formed in connection with the Spin-Off from Lennar to create an independent, publicly traded company that provides the HOPP’R to Lennar, Lennar Related Ventures and Other Customers. Millrose purchases and develops residential land and sells finished homesites back to homebuilders by way of option contracts with predetermined costs and takedown schedules. In certain instances, Millrose may extend development to vertical construction on owned homesites, with any such funding similarly repaid via scheduled sales to homebuilders. Millrose intends its “first of its kind” public vehicle to be attractive to homebuilders seeking to implement an asset-light strategy. As fully developed homesites are taken down by the homebuilder, capital is recycled into future land acquisitions for homebuilders, providing each customer with uninterrupted access to capital. Through our subsidiaries, we hold finished homesites with homes under construction, finished homesites imminently ready for construction, Land Under Development, land ready for development and land not yet ready for development. We are externally managed and advised by Kennedy Lewis Land and Residential Advisors LLC (“KL” or the “Manager”), pursuant to the Management Agreement between Millrose and KL entered into February 7, 2025 (the “Management Agreement”).

Previous wording

On February 7, 2025 (the “Distribution Date”), we completed our Spin-Off from Lennar through a distribution of approximately 80% of Millrose’s outstanding common stock to holders of Lennar common stock as of the close of business on January 21, 2025. In connection with the Spin-Off, we received a contribution from Lennar of approximately $5.5 billion in land assets, representing approximately 87,000 Homesites, and cash of approximately $1 billion, which included $585 million of cash deposit liabilities related to option contracts with Lennar.

Current wording

On February 7, 2025 (the “Distribution Date”), we completed our Spin-Off from Lennar through a distribution of approximately 80% of Millrose’s outstanding common stock to holders of Lennar common stock as of the close of business on January 21, 2025. In connection with the Spin-Off, we received a contribution from Lennar of approximately $5.5 billion in land assets, representing approximately 87,000 Homesites, and cash of approximately $1.0 billion, which included $585 million of cash deposit liabilities related to option contracts with Lennar.

Previous wording

(1) Includes Homesite inventory contributed by Lennar at Spin-Off and acquired from Rausch, less option earning deposits and other holdbacks.

Current wording

(1) Includes (a) Homesite inventory contributed by Lennar at Spin-Off and acquired from Rausch, less option earning deposits and other holdbacks, and (b) takedown and land acquisition and development funding activity during the first quarter 2025.

Previous wording

(2) Reduction in investment balance from homesite sales pursuant to option agreements associated with the applicable category shown.

Current wording

(2) Reduction in investment balance from homesite sales pursuant to option agreements associated with the applicable category shown; takedowns are net of deposit credits adjusted for non-option earning deposits.

Previous wording

(3) Includes land acquisitions after February 10, 2025, net of option earning deposits.

Current wording

(3) Includes land acquisitions during the second quarter 2025, net of option earning deposits.

Previous wording

During the three months ended March 31, 2025, we funded $635 million for land acquisition and development and received $680 million in net takedown proceeds under the Master Program Agreement. Funding for Other Agreements during this period was $350 million at a weighted average yield of 11.7%. On a total portfolio basis, the weighted average yield was 8.7% as of March 31, 2025.

Current wording

During the three months ended June 30, 2025, we funded $718 million for land acquisition and development and received $806 million in net takedown proceeds under the Master Program Agreement at a weighted average yield of 8.5%. We funded $813 million for land acquisition and development and received $28 million in net takedown proceeds for Other Agreements during this period at a weighted average yield of 11.4%. On a total portfolio basis, the weighted average yield was 8.9% as of June 30, 2025.

Previous wording

As of March 31, 2025, our Homesite assets consisted of 876 properties (also known as communities) in 29 states across the United States, totaling approximately 111,181 Homesites, with an approximate aggregate value of $6.7 billion of Homesite inventory. Of the Homesites owned as of March 31, 2025, we expect that total Takedown Prices of all Homesites to be approximately $10.9 billion, and the total estimated development costs of Homesites to be approximately $4.6 billion. The properties are geographically located in the United States.

Current wording

As of June 30, 2025, our Homesite assets consisted of 1,000 properties (also known as communities) in 29 states across the United States, totaling approximately 128,904 Homesites, with an approximate aggregate value of $7.6 billion of Homesite inventory. Of the Homesites owned as of June 30, 2025, we expect the total Takedown Prices of all Homesites to be approximately $13.1 billion, and the total estimated development costs of Homesites to be approximately $5.5 billion. The properties are geographically located in the United States.

Previous wording

As of March 31, 2025, our property assets are collectively located across 29 U.S. states. Approximately 46% of the property assets are concentrated in three states (California, Florida, Texas) in terms of number of Homesites and approximately 37% located in two strong housing market states: Florida (where Lennar has historically had a large portion of its real estate activities and is continuing to grow its real estate activities) and Texas (where we believe the market has healthy underlying demographic and/or economic trends primarily driven by generally steadily growing population).

Current wording

As of June 30, 2025, our property assets are collectively located across 29 U.S. states. Approximately 48% of the property assets are concentrated in three states (California, Florida, Texas) in terms of number of Homesites and approximately 39% are located in two strong housing market states: Florida (where Lennar has historically had a large portion of its real estate activities and is continuing to grow its real estate activities) and Texas (where we believe the market has healthy underlying demographic and/or economic trends primarily driven by generally steadily growing population).

Previous wording

As of March 31, 2025, the Homesites within the Master Program Agreement were included in 32 separate pools, in accordance with the applicable Multiparty Cross Agreements. The average number of properties per pool was 27 and the aggregate sum of all option deposits Lennar has made, or is obligated to make with respect to a new pool of Future Property Assets, shall not at any time exceed $50 million with respect to pools of the Transferred Assets and $25 million with respect to pools of Future Property Assets. Pools will be established with primary consideration given to diversity within pools across geographies, communities, and home types. Future Homesite option contracts outside of the Master Program Agreement with Lennar may or may not contain pooling arrangements. As of March 31, 2025, Homesites outside of the Master Program Agreement do not have a pooling arrangement.

Current wording

As of June 30, 2025, the Homesites within the Master Program Agreement were included in 50 separate pools, in accordance with the applicable Multiparty Cross Agreements. The average number of properties per pool was 14.7 and the aggregate sum of all option deposits Lennar has made, or is obligated to make with respect to a new pool of Future Property Assets, shall not at any time exceed $50 million with respect to pools of the Transferred Assets and $25 million with respect to pools of Future Property Assets. Pools will be established with primary consideration given to diversity within pools across geographies, communities, and home types. Future Homesite option contracts outside of the Master Program Agreement with Lennar may or may not contain pooling arrangements.

Previous wording

The following is a summary of the key components of our operations for the three months ended March 31, 2025:

Current wording

The following is a summary of the key components of our operations for the three and six months ended June 30, 2025:

Previous wording

Operating Expenses: Our operating expenses after the Spin-Off are composed of Management Fees paid to KL for management and advisory services. The fee is calculated as 1.25% of Tangible Assets (as defined in the Management Agreement) (the “Management Fee”). All employees are employed by KL and their salaries are paid by KL; therefore, we do not record personnel related expenses, including salaries, benefits, and share-based compensation for any employees. All cash compensation paid to our Board of Directors (the “Board”) and certain general and administrative expenses are covered by the Management Fee. The Management Fee does not cover offering expenses, costs incurred for services in connection with extraordinary litigation and mergers and acquisitions and other events outside of Millrose’s ordinary course of business, and, in some circumstances, costs associated with the ownership and maintenance of land. Any such expenses that are not covered by the Management Fee are paid for by Millrose and are recorded as general and administrative expenses or other expenses, as appropriate under GAAP.

Current wording

Operating Expenses: Our operating expenses after the Spin-Off include Management Fees paid to KL for management and advisory services. The Management Fee is calculated as 1.25% of Tangible Assets (as defined in the Management Agreement) (the “Management Fee”). All employees are employed by KL and their salaries are paid by KL; therefore, we do not record personnel related expenses, including salaries, benefits, and share-based compensation for any employees. All cash compensation paid to our Board of Directors (the “Board”) and certain general and administrative expenses are covered by the Management Fee. The Management Fee does not cover offering expenses, costs incurred for services in connection with extraordinary litigation and mergers and acquisitions and other events outside of Millrose’s ordinary course of business, and, in some circumstances, costs associated with the ownership and maintenance of land. Any such expenses that are not covered by the Management Fee are paid for by Millrose and are recorded as general and administrative expenses or other expenses, as appropriate under GAAP. Certain of our option agreements provide (and new option agreements in the future may provide) for reimbursement by the counterparties of our transaction and/or asset management expenses, including third-party legal, diligence and servicing costs, and may include certain amounts paid by such counterparties directly to affiliates of the Manager in connection with related services provided to by such affiliates to the applicable counterparties. Our operating expenses also include stock-based compensation for restricted stock units (“RSUs”) granted to each member of the Board during the second quarter 2025. The Company records the RSU award costs on a straight-line basis over the one-year vesting period as stock-based compensation in operating expenses.

Previous wording

Other Income and Expenses: We record interest income from our cash as other income as it is not part of the primary activities of the business. Other expenses also include interest expense related to our Revolving Credit Facility (as defined below) with commitments of $1.335 billion.

Current wording

Other Income and Expenses: We record interest income from our cash as other income as it is not part of the primary activities of the business. Other expenses also include (i) interest expense related to our Revolving Credit Facility (as defined below) with commitments of $1.335 billion and our DDTL Credit Facility (as defined below) with commitments of $1.0 billion, and (ii) other expenses related to rating agency fees, legal fees, audit fees, and bank fees.

Previous wording

The following discussion describes the results of operations for the three months ended March 31, 2025 versus the three months ended March 31, 2024. The financial data includes the combined results of operations for the Predecessor Millrose Business prior to the Spin-Off and the Millrose business after the Spin-Off. The results of operations include activity related to the acquired Rausch land assets from the February 10, 2025 acquisition date through March 31, 2025. We have a single operating and reportable segment in accordance with GAAP and our operations are conducted in the United States.

Current wording

The following discussion describes the results of operations for the three and six months ended June 30, 2025 versus the three and six months ended June 30, 2024. The financial data includes the combined results of operations for the Predecessor Millrose Business prior to the Spin-Off and the Millrose business after the Spin-Off. The results of operations include activity related to the acquired Rausch land assets from the February 10, 2025 acquisition date through June 30, 2025. We have a single operating and reportable segment in accordance with GAAP and our operations are conducted in the United States.

Previous wording

Other income and expense was a net expense of $1.5 million for the three months ended March 31, 2025, compared to $0 for the three months ended March 31, 2024. Other income and expenses for the three months ended March 31, 2025 includes interest expense for the Revolving Credit Facility entered into after the Spin-Off and interest income from the Company’s cash accounts after the Spin-Off. The Predecessor Millrose Business did not have other income and expenses for three months ended March 31, 2025 prior to the Spin-Off and for the three months ended March 31, 2024.

Current wording

Other income and expense was a net expense of $9.3 million for the three months ended June 30, 2025, compared to $0 for the three months ended June 30, 2024. Other income and expense for the three months ended June 30, 2025 includes (i) interest expense for the Revolving Credit Facility and DDTL Credit Facility of $10.3 million, and (ii) other expenses of $0.8 million, which was partially offset by interest income of $1.8 million related to cash balances.

Previous wording

The provision for income taxes for the three months ended March 31, 2025 was $4.4 million, compared to $0 for the three months ended March 31, 2024. The first quarter 2025 tax provision resulted in an overall effective tax rate of 24.8%. There was no income tax expense for the Predecessor Millrose Business for the three months ended March 31, 2024 due to offsetting changes in the valuation allowance against its deferred taxes that reduced income tax and effective tax rate to zero. See Note 9. Income Taxes to the unaudited condensed consolidated financial statements for more information.

Current wording

The provision for income taxes for the three months ended June 30, 2025 was $4.8 million, compared to $0 for the three months ended June 30, 2024. The second quarter 2025 tax provision resulted in an overall effective tax rate of 24.8%. There was no income tax expense for the Predecessor Millrose Business for the three months ended June 30, 2024 due to offsetting changes in the valuation allowance against its deferred taxes that reduced income tax and effective tax rate to zero. See Note 9. Income Taxes to the unaudited condensed consolidated financial statements for more information.

Previous wording

Our net income was $39.8 million for the three months ended March 31, 2025, compared to a net loss of $56.9 million for the three months ended March 31, 2024. Our net income for the three months ended March 31, 2025 includes post Spin-Off income of $64.8 million, partially offset by pre-spin net loss of $25.0 million related to sales, general, and administrative expenses attributable to the Predecessor Millrose Business. The increase in net income for the three months ended March 31, 2025 compared to March 31, 2024 is due to (i) revenues earned after the Spin-Off and (ii) lower actual operating expenses after the Spin-Off versus an allocation prior to the Spin-Off, partially offset by (a) higher net interest expense, and (b) higher tax provision.

Current wording

Our net income was $152.5 million for the six months ended June 30, 2025, compared to a net loss of $116.7 million for the six months ended June 30, 2024. Our net income for the six months ended June 30, 2025 includes post Spin-Off income of $177.5 million, partially offset by pre-spin net loss of $25.0 million related to sales, general, and administrative expenses attributable to the Predecessor Millrose Business. The increase in net income for the six months ended June 30, 2025 compared to the six months ended June 30, 2024 is due to (i) revenues earned after the Spin-Off and (ii) lower actual operating expenses after the Spin-Off versus an allocation prior to the Spin-Off, partially offset by (a) higher net interest expense, and (b) higher tax provision, and (c) higher other expenses.

Previous wording

Option fees and other related income was $82.7 million for the three months ended March 31, 2025, compared to $0 for the three months ended March 31, 2024. For the three months ended March 31, 2025 prior to the Spin-Off and for the three months ended March 31, 2024, the Predecessor Millrose Business did not have revenues, as all finished Homesites were transferred to the Predecessor Millrose Business’s parent company, who sold those homes to Lennar customers.

Current wording

Option fees and other related income was $231.7 million for the six months ended June 30, 2025, compared to $0 for the six months ended June 30, 2024. For the six months ended June 30, 2025 prior to the Spin-Off and for the six months ended June 30, 2024, the Predecessor Millrose Business did not have revenues, as all finished Homesites were transferred to the Predecessor Millrose Business’s parent company, who sold those homes to Lennar customers.

Previous wording

Management fee expense for the three months ended March 31, 2025 was $12.1 million, compared to $0 for the three months ended March 31, 2024. Management fee expense represents the costs for KL management services after the Spin-Off and incurred through March 31, 2025.

Current wording

Management fee expense for the six months ended June 30, 2025 was $34.1 million, compared to $0 for the six months ended June 30, 2024. Management fee expense represents the costs for KL management services after the Spin-Off and incurred through June 30, 2025.

Previous wording

Sales, general and administrative expenses from Pre-Spin periods were $25.0 million for the three months ended March 31, 2025, compared to $56.9 for the three months ended March 31, 2024. For the first quarter of 2025, the expenses were allocated by Lennar for the periods January 1, 2025 to the Spin-Off, which is the driver for the decrease as compared to the first quarter of 2024 which included sales, general, and administrative expenses for the full quarter. There were no sales, general and administrative expenses recorded after the Spin-Off.

Current wording

Sales, general and administrative expenses from Pre-Spin periods were $25.0 million for the six months ended June 30, 2025, compared to $116.7 million for the six months ended June 30, 2024. For the six months ended June 30, 2025, the expenses were allocated by Lennar for the periods January 1, 2025 to the Spin-Off, which is the driver for the decrease as compared the six months ended June 30 2024 which included sales, general, and administrative expenses for the full first and second quarters of 2024. There were no sales, general and administrative expenses recorded after the Spin-Off.

Previous wording

Net income from operations before income tax was $44.2 million for the three months ended March 31, 2025, compared to a net operating loss of $56.9 million for the three months ended March 31, 2024. Our net income from operations before taxes includes post Spin-Off net income before taxes of $69.1 million, partially offset by pre-spin net loss of $25.0 million related to sales, general, and administrative expenses attributable to the Predecessor Millrose Business. The increase in operating income is due to (i) revenues earned after the Spin-Off and (ii) lower operating expenses which due to lower management service fees after the Spin-Off compared to sales, general, and administrative expenses allocated prior to the Spin-Off, partially offset by higher net interest expense as a result of the Revolving Credit Facility.

Current wording

Net income from operations before income tax was $161.7 million for the six months ended June 30, 2025, compared to a net operating loss of $116.7 million for the six months ended June 30, 2024. Our net income from operations before taxes includes post Spin-Off net income before taxes of $186.7 million, partially offset by pre-spin net loss of $25.0 million related to sales, general, and administrative expenses attributable to the Predecessor Millrose Business. The increase in operating income is due to (i) revenues earned after the Spin-Off and (ii) lower operating expenses which due to lower management service fees after the Spin-Off compared to sales, general, and administrative expenses allocated prior to the Spin-Off, partially offset by (a) higher net interest expense as a result of the Revolving Credit Facility and the DDTL Credit Facility, (b) higher tax provision, and (c) higher other expenses.

Previous wording

As of March 31, 2025, we had $89.5 million cash on hand and approximately $1.0 billion capacity under our Revolving Credit Facility. Our primary sources of liquidity are cash flows from operations and debt financing under our Revolving Credit Facility of $1.335 billion. We believe that our existing cash on hand, cash generated from operations and available capacity under the Revolving Credit Facility will be sufficient to meet our liquidity needs in the short and long term. Our ability to satisfy our liquidity requirements depends on our future operating performance, which is affected by prevailing economic conditions, market conditions in the real estate industry and other factors, many of which are beyond our control.

Current wording

As of June 30, 2025, we had $66.6 million cash on hand and approximately $1.310 billion capacity under our Revolving Credit Facility. Our primary sources of liquidity are cash flows from operations and debt financing under our Revolving Credit Facility of $1.335 billion and our DDTL Credit Facility of $1.0 billion. We believe that our existing cash on hand, cash generated from operations and available capacity under the Revolving Credit Facility will be sufficient to meet our liquidity needs in the short and long term. Our ability to satisfy our liquidity requirements depends on our future operating performance, which is affected by prevailing economic conditions, market conditions in the real estate industry and other factors, many of which are beyond our control.

Previous wording

Our cash flows for the three months ended March 31, 2025 and 2024 are presented below. The financial data includes the results of cash flows for the Predecessor Millrose Business prior to the Spin-Off, which is derived from the financial statements of Lennar; and the Millrose business after the Spin-Off, which is derived from the accounting records of Millrose.

Current wording

Our cash flows for the six months ended June 30, 2025 and 2024 are presented below. The financial data includes the results of cash flows for the Predecessor Millrose Business prior to the Spin-Off, which is derived from the financial statements of Lennar; and the Millrose business after the Spin-Off, which is derived from the accounting records of Millrose.

Previous wording

For the three months ended March 31, 2025, net cash from operating activities was $21.3 million. Our cash sources were $59.0 million consisting of option fee income of $32.9 million and interest income of $1.1 million, and pre-spin adjustments of $25.0 million. Our cash used was $37.7 million and consisted of our Management Fee payment to KL of $12.1 million, interest payments on our Revolving Credit Facility of $0.6 million, and Predecessor Millrose Business pre-spin-off net loss of $25.0 million.

Current wording

For the six months ended June 30, 2025, net cash from operating activities was $130.3 million. Our cash sources were $207.2 million consisting of option fee income of $174.4 million, development loan interest paid-in-kind of $4.9 million, interest income of $2.9 million, and pre-spin adjustments of $25.0 million. Our cash used was $76.9 million and consisted of our Management Fee payment to KL of $34.1 million, interest payments on our Revolving Credit Facility of $8.7 million, tax payments of $8.5 million, agency fee payments of $0.4 million, legal fee payments of $0.2 million, and Predecessor Millrose Business pre-spin-off net loss of $25.0 million.

Previous wording

For the three months ended March 31, 2024, net cash from operating activities was $182.3 million, primarily consisting of inventory takedowns of $232.1 million, and stock-based compensation of $7.1 million, which was partially offset by net operating loss of $56.9 million. All cash from the operating activities for the three months ended March 31, 2024 was allocated to the Predecessor Millrose Business by Lennar and not generated by the Predecessor Millrose Business itself.

Current wording

For the six months ended June 30, 2024, net cash from operating activities was $599.9 million, primarily consisting of inventory takedowns of $709.6 million, and stock-based compensation of $8.9 million, which was partially offset by operating expenses of $1.9 million and by net operating loss of $116.7 million. All cash from the operating activities for the six months ended June 30, 2024 was allocated to the Predecessor Millrose Business by Lennar and not generated by the Predecessor Millrose Business itself.

Previous wording

For the three months ended March 31, 2025, net cash used in investing activities was $606.2 million. Our cash used was $1.837 billion, consisting of payments to acquire Rausch land assets of $858.9 million and investments in Homesite inventory and other related assets of $978.5 million. Our cash sources were $1.231 billion, consisting of option deposit payments from Lennar at Spin-Off of $584.8 million and takedowns of Homesite inventories and other related assets of $646.4 million.

Current wording

For the six months ended June 30, 2025, net cash used in investing activities was $1.333 billion. Our cash used was $3.356 billion, consisting of payments to acquire Rausch land assets of $858.9 million and investments in Homesite inventory and other related assets of $2.497 billion. Our cash sources were $2.023 billion, consisting of option deposit payments from Lennar at Spin-Off of $584.8 million and takedowns of Homesite inventories and other related assets of $1.438 billion.

Previous wording

For the three months ended March 31, 2025, net cash from financing activities was $674.4 million. Our cash sources were $865.1 million, consisting of cash contributed by Lennar at Spin-Off of $415.1 million and Revolving Credit Facility drawdowns of $450.0 million. Our cash used was $190.7 million, consisting of Spin-Off costs of $75.1 million, Revolving Credit Facility financing payments of $9.6 million, repayment of Revolving Credit Facility debt of $100.0 million, and payment on seller notes of $6.0 million.

Current wording

For the six months ended June 30, 2025, net cash from financing activities was $1.269 billion. Our cash sources were $2.365 billion, consisting of cash contributed by Lennar at Spin-Off of $415.2 million, Revolving Credit Facility drawdowns of $950.0 million, and DDTL Credit Facility drawdowns of $1.0 billion. Our cash used was $1.096 billion, consisting of Spin-Off costs of $77.9 million, Revolving Credit Facility financing payments of $925.0 million, repayment of Revolving Credit Facility debt of $9.9 million, DDTL Credit Facility financing payments of $14.1 million, dividends paid to shareholders of $63.1 million, and payment on seller notes of $6.0 million.

Previous wording

For the three months ended March 31, 2024, net cash used in financing activities was $182.3 million, consisting of principal payment on debt of $16.1 million and transfers to Lennar of $166.2 million. All cash from the financing activities for the three months ended March 31, 2024 was allocated to the Predecessor Millrose Business by Lennar and not generated by the Predecessor Millrose Business itself.

Current wording

For the six months ended June 30, 2024, net cash used in financing activities was $599.9 million, consisting of principal payment on debt of $18.0 million and transfers to Lennar of $581.9 million. All cash from the financing activities for the six months ended June 30, 2024 was allocated to the Predecessor Millrose Business by Lennar and not generated by the Predecessor Millrose Business itself.

Previous wording

On the Distribution Date, we entered into a credit agreement with a consortium of lenders with JPMorgan Chase Bank, N.A., as administrative agent for the lenders (the “Credit Agreement”). The Credit Agreement provides for a revolving credit facility (the “Revolving Credit Facility”) with commitments in an aggregate amount of $1.335 billion, of which $450 million has been borrowed, and $100 million has been repaid, as of March 31, 2025. Availability under the Credit Agreement is subject to a borrowing base updated quarterly (or, at our option, monthly), which is calculated by reference to the value of certain real property assets, with advance rates that vary by asset category, and unrestricted cash and cash equivalents, with adjustments as specified in the Credit Agreement. The Revolving Credit Facility may be used by us to borrow loans or obtain standby letters of credit.

Current wording

Availability under the Revolving Credit Agreement is subject to a borrowing base updated quarterly (or, at our option, monthly), which is calculated by reference to the value of certain real property assets, with advance rates that vary by asset category, and unrestricted cash and cash equivalents, with adjustments as specified in the Revolving Credit Agreement. The Revolving Credit Facility may be used by us to borrow loans or obtain standby letters of credit.

Previous wording

Loans under the Credit Agreement bear interest at the Adjusted Term SOFR Rate (as defined in the Credit Agreement) plus an applicable margin at the per annum rate of (i) 2.00%, if the Leverage Ratio (as defined in the Credit Agreement) is less than or equal to 0.30 to 1.00, (ii) 2.25% if Leverage Ratio is greater than 0.30 to 1.00 and less than or equal to 0.40 to 1.00, and (iii) 2.50% if the Leverage Ratio is greater than 0.40 to 1.00. At our option, loans may instead bear interest at the Alternate

Current wording

Loans under the Revolving Credit Agreement bear interest at the Adjusted Term SOFR Rate (as defined in the Revolving Credit Agreement) plus an applicable margin at the per annum rate of (i) 2.00%, if the Leverage Ratio (as defined in the Revolving Credit Agreement) is less than or equal to 0.30 to 1.00, (ii) 2.25% if Leverage Ratio is greater than 0.30 to 1.00 and less than or equal to 0.40 to 1.00, and (iii) 2.50% if the Leverage Ratio is greater than 0.40 to 1.00. At our option, loans may instead bear interest at the Alternate Base Rate (as defined in the Revolving Credit Agreement) plus an applicable margin at the per annum rate of 1.00%, 1.25% or 1.50%, depending upon the Leverage Ratio.

Previous wording

As of March 31, 2025, there were no guarantors under the Credit Agreement. We may elect to join certain of our subsidiaries to the Credit Agreement as guarantors from time to time, and in certain circumstances, the Credit Agreement requires us to cause certain of our future subsidiaries that are not Taxable REIT Subsidiaries (as defined in the Credit Agreement) to become guarantors.

Current wording

As of June 30, 2025, there were no guarantors under the Revolving Credit Agreement. We may elect to join certain of our subsidiaries to the Revolving Credit Agreement as guarantors from time to time, and in certain circumstances, the Revolving Credit Agreement requires us to cause certain of our other subsidiaries that are not Taxable REIT Subsidiaries (as defined in the Revolving Credit Agreement) to become guarantors.

Previous wording

The Credit Agreement includes affirmative and negative covenants applicable to us and our subsidiaries, including limitations regarding indebtedness, liens, dividends and other restricted payments, investments, asset sales, transactions with affiliates, restrictive agreements, mergers and other fundamental changes, permitted lines of business, financial contracts, and designation of unrestricted subsidiaries. The Credit Agreement contains financial covenants, tested quarterly, consisting of a maximum Leverage Ratio, a minimum interest coverage ratio, and a minimum tangible net worth. The Credit Agreement also requires us to be in compliance with all REIT requirements. As of March 31, 2025, we were in compliance with all covenants under the Credit Agreement.

Current wording

The Revolving Credit Agreement includes affirmative and negative covenants applicable to us and our subsidiaries, including limitations regarding liens, investments, asset sales, transactions with affiliates, restrictive agreements, mergers and other fundamental changes, permitted lines of business, financial contracts, and designation of unrestricted subsidiaries. The Revolving Credit Agreement contains financial covenants, tested quarterly, consisting of a maximum Leverage Ratio, a minimum interest coverage ratio, and a minimum tangible net worth. The Revolving Credit Agreement also requires us to be in compliance with all REIT requirements. As of June 30, 2025, we were in compliance with all covenants under the Revolving Credit Agreement.

Previous wording

The Credit Agreement contains events of default, including if KL shall cease to be our manager and a replacement manager reasonably acceptable to the required lenders is not appointed within 90 days.

Current wording

The Revolving Credit Agreement contains events of default, including if KL shall cease to be our manager and a replacement manager reasonably acceptable to the required lenders is not appointed within 90 days.

Previous wording

The Credit Agreement is scheduled to mature on February 7, 2028.

Current wording

The Revolving Credit Agreement is scheduled to mature on February 7, 2028 (the “ Revolving Maturity Date”). Principal amounts and other obligations outstanding under the Revolving Credit Facility are due in full on the Revolving Maturity Date. Interest on each drawdown is due quarterly for loans bearing interest at the Alternate Base Rate and on the last day of the applicable interest payment date for loans bearing interest at the Adjusted Term SOFR Rate.

Previous wording

Obligations under the Credit Agreement are secured by pledges by us of (i) the Promissory Note (as defined below) and (ii) the equity interests of Millrose Holdings. In addition, the Credit Agreement requires us to pledge (i) certain future promissory notes similar to the Promissory Note that Millrose may enter into with future subsidiaries and (ii) the equity interests of any future subsidiaries whose equity interests are not pledged for the benefit of the Promissory Note or any other similar promissory note or notes.

Current wording

Obligations under the DDTL Credit Agreement are secured by pledges by the Company of (i) the Promissory Note, and (ii) the equity interests of Millrose Holdings. In addition, the DDTL Credit Agreement requires the Company to pledge (i) certain future promissory notes similar to the Promissory Note that Millrose may enter into with other subsidiaries and (ii) the equity interests of any other subsidiaries whose equity interests are not pledged for the benefit of the Promissory Note or any other similar promissory note or notes. Pursuant to the ICA, the DDTL Administrative Agent and the Revolver Agent agree that certain liens on Shared Collateral (as defined in the ICA) securing the DDTL Credit Agreement and the Revolving Credit Agreement shall be of equal priority, and certain distributions made in respect of Shared Collateral shall be shared on a ratable basis.

Previous wording

In addition to the Credit Agreement, Millrose may seek to pursue other debt and expects to have access to a certain amount of debt and equity capital at least a portion of which is intended to be available for use in financing transactions with new customers. However, there is no guarantee that such sources of additional capital will be obtained on acceptable terms or at all or will be sufficient to cover all of Millrose’s business growth initiatives. As such, Millrose may also seek additional third-party financing to satisfy any additional capital needs or raise capital through equity and debt issuances into the market. Additionally, any third-party financing arrangements Millrose enters into may not cause its debt to equity ratio to exceed 1:1 (the “Debt to Equity Ratio Limit”), unless Millrose obtains the prior approval of Lennar.

Current wording

In addition to the Credit Agreements, Millrose may seek to pursue other debt and expects to have access to a certain amount of debt and equity capital at least a portion of which is intended to be available for use in financing transactions with new customers. However, there is no guarantee that such sources of additional capital will be obtained on acceptable terms or at all or will be sufficient to cover all of Millrose’s business growth initiatives. As such, Millrose may also seek additional third-party financing to satisfy any additional capital needs or raise capital through equity and debt issuances into the market. Additionally, any third-party financing arrangements Millrose enters into may not cause its debt to equity ratio to exceed 1:1 (the “Debt to Equity Ratio Limit”), unless Millrose obtains the prior approval of Lennar.

Previous wording

In addition to the Credit Agreement, from time to time, Millrose may enter into various “secured financing arrangements,” which may include but are not limited to secured or collateralized loans, or any other transactions where assets may be pledged or used as collateral to secure the financing instrument, whether or not the security interest is perfected. In such cases, Millrose may use the land assets it holds through its subsidiaries in its real estate portfolio or the proceeds from customers’ exercises of purchase options relating to the land assets in Millrose’s real estate portfolio as collateral to secure the financing. While Millrose may, at its discretion, enter into any secured financing arrangements it so chooses (subject to the Debt to Equity Ratio Limit), Millrose is prohibited from granting or selling any security interest whereby the assets pledged pursuant to such security interest include Transferred Assets, Supplemental Transferred Assets or Future Property Assets held pursuant to the Lennar Agreements and Future Property Assets of Other Customers (i.e., mixing the assets into one collateral pool) without Lennar’s prior written consent.

Current wording

In addition to the Credit Agreements, from time to time, Millrose may enter into various “secured financing arrangements,” which may include but are not limited to secured or collateralized loans, or any other transactions where assets may be pledged or used as collateral to secure the financing instrument, whether or not the security interest is perfected. In such cases, Millrose may use the land assets it holds through its subsidiaries in its real estate portfolio or the proceeds from customers’ exercises of purchase options relating to the land assets in Millrose’s real estate portfolio as collateral to secure the financing. While Millrose may, at its discretion, enter into any secured financing arrangements it so chooses (subject to the Debt to Equity Ratio Limit), Millrose is prohibited from granting or selling any security interest whereby the assets pledged pursuant to such security interest include Transferred Assets, Supplemental Transferred Assets or Future Property Assets held pursuant to the Lennar Agreements and Future Property Assets of Other Customers (i.e., mixing the assets into one collateral pool) without Lennar’s prior written consent.

Previous wording

On March 17, 2025, our Board declared a dividend of $0.38 to be paid to holders of its Class A common stock and Class B common stock as of the close of business on April 4, 2025, which was paid on April 15, 2025. We intend to make regular dividend payments of at least 90% of our REIT taxable income to holders of our common stock out of assets legally available for this purpose. While we do not plan to do so, under currently applicable Internal Revenue Services guidance, approximately 80% of these dividends may be paid in the form of stock dividends, rather than in cash. Dividends will be authorized by our Board and declared by us based on a number of factors including actual results of operations, dividend restrictions under

Current wording

On April 15, 2025, the Company paid a dividend of $0.38 to holders of its Class A common stock and Class B common stock as of the close of business on April 4, 2025, as declared by the Board on March 17, 2025. On June 16, 2025 the Company declared a dividend of $0.69 to Class A common stockholders and Class B common stockholders of record as of the close of business July 3, 2025. This dividend was paid on July 15, 2025.We intend to make regular dividend payments of at least 90% of our REIT taxable income to holders of our common stock out of assets legally available for this purpose. While we do not plan to do so, under currently applicable Internal Revenue Services guidance, approximately 80% of these dividends may be paid in the form of stock dividends, rather than in cash. Dividends will be authorized by our Board and declared by us based on a number of factors including actual results of operations, dividend restrictions under Maryland law or applicable debt covenants, our liquidity and financial condition, our taxable income, the annual distribution requirements under the REIT provisions of the Code, our operating expenses and any other factors our Board deems relevant. Subject to certain exceptions, distributions received from us will not be qualified dividends and will therefore be taxed at ordinary income rates to the extent of our current or accumulated earnings and profits.

Previous wording

As part of the recapitalization of Millrose Holdings prior to the distribution, on February 6, 2025, Millrose Holdings issued to Millrose a promissory note (the “Promissory Note”) of approximately $4.8 billion that is secured by a pledge of all equity interests in the Initial Property LLCs and unrecorded mortgages on the Transferred Assets.

Current wording

As part of the recapitalization of Millrose Holdings prior to the distribution, on February 6, 2025, Millrose Holdings and certain of its subsidiaries issued to Millrose a promissory note (the “Promissory Note”) of approximately $4.8 billion that is secured by a pledge of all equity interests in the Initial Property LLCs and unrecorded mortgages on the Transferred Assets.

Previous wording

We intend to elect to be taxed as a REIT under Sections 856 through 860 of the Code and expect to qualify as a REIT. To qualify as a REIT, we must meet a number of organizational and operational requirements, including a requirement that we distribute at least 90% of our “REIT taxable income,” as defined by the Code, to our stockholders. Taxable income from certain non-REIT qualifying activities is derived through our TRSs and is subject to applicable U.S. federal, state, and local income and franchise taxes. During the three months ended March 31, 2025, we recorded consolidated income tax expense of $4.4 million, which was attributable to our TRSs. We had no significant taxes associated with our TRS for the years ended December 31, 2024 or three months ended March 31, 2024.

Current wording

We intend to elect to be taxed as a REIT under Sections 856 through 860 of the Code and expect to qualify as a REIT. To qualify as a REIT, we must meet a number of organizational and operational requirements, including a requirement that we distribute at least 90% of our “REIT taxable income,” as defined by the Code, to our stockholders. Taxable income from certain non-REIT qualifying activities is derived through our TRSs and is subject to applicable U.S. federal, state, and local income and franchise taxes. During the three and six months ended June 30, 2025, we recorded consolidated income tax expense of $4.8 million and $9.1 million, respectively, which was attributable to our TRSs. We had no significant taxes associated with our TRS for the years ended December 31, 2024 or six months ended June 30, 2024.