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Kimball Hill names Hede chief restructuring officer, amends credit facility financial covenants
By Caroline Salls
Pittsburgh, Feb. 22 - Kimball Hill, Inc. has appointed Andrew D. J. Hede as its chief restructuring officer and amended some of the financial covenants under its credit facility for the periods ended Sept. 30 and Dec. 31, according to an 8-K filed with the Securities and Exchange Commission.
Hede is a managing director at Alvarez & Marsal North America, LLC, a financial advisory and consulting firm that was previously hired by Kimball Hill to help it develop and consider a number of strategic alternatives.
"Andrew has worked with a number of local and national homebuilders and provides a valuable perspective and experience to the Kimball Hill management team as we continue to explore strategic alternatives available to the company," Kimball Hill chief executive officer Kenneth Love said in a company news release.
The financial covenant changes were part of amendments to the company's limited duration waiver agreement, according to the 8-K.
Specifically, the amendments include a reduction in the minimum tangible net worth to $154 million from $160 million and an increase in the maximum permitted guarantees of joint venture debt to 45% of tangible net worth from 35% of tangible net worth.
As result of these amendments, the company said it is in compliance with the financial covenants contained in the credit agreement as of Sept. 30 and Dec. 31.
In addition, Kimball Hill has agreed to either agree with the administrative agent under the credit agreement on a blocked account agreement by Feb. 26 or to move all cash into deposit accounts with a lender by Feb. 26.
As previously reported, Kimball Hill announced on Feb. 12 that it had hired Alvarez & Marsal to consider alternatives including "a complete restructuring," and the company warned it may miss its June coupon payment.
Kimball Hill is a Rolling Meadows, Ill.-based homebuilder.
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