LGI Homes plans to pay down revolver debt with note proceeds

By Wendy Van Sickle

Columbus, Ohio, June 21 – LGI Homes, Inc. plans to pay down its revolving credit facility with proceeds of a $400 million offering of eight-year notes, according to an 8-K filing with the Securities and Exchange Commission.

The company entered into an amendment on June 19 to its third amended and restated credit agreement dated May 25 with Wells Fargo Bank, NA as administrative agent, Wells Fargo Securities, LLC as lead arranger and bookrunner and Fifth Third Bank and U.S. Bank, NA as documentation agents.

Under the amendment, the revolving commitment will be reduced to the lesser of $450 million or the amount permitted by the senior notes indenture from $750 million.

Additionally, the leverage ratio that would result in a trigger event will be increased to 60% from 57.5%.

The amendment also amended a financial covenant of the credit agreement such that, upon the issuance of senior notes, the maximum leverage ratio will increase to 64% from 60%.

LGI announced plans to start a roadshow on Friday for a $400 million offering of eight-year senior notes.

The homebuilder is based in the Woodlands, Texas.

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