M/I Homes amends loan, reducing size, modifying covenants and pricing

By Sara Rosenberg

New York, April 1 - M/I Homes Inc. amended its credit facility, reducing the size to $250 million from $500 million, revising covenants and increasing pricing, according to an 8-K filed with the Securities and Exchange Commission Tuesday.

Under the amendment, the interest coverage ratio is set at 1.50 to 1.00, but if the company is unable to comply with this requirement, it is not an event of default as long as the company is in compliance with the leverage ratio and the minimum liquidity requirement.

The leverage ratio is 1.00 to 1.00 at any time at which the interest coverage ratio is less than 1.00 to 1.00, 1.20 to 1.00 at any time at which the interest coverage ratio is greater than or equal to 1.00 to 1.00 and less than 1.25 to 1.00, and 1.40 to 1.00 at all other times.

Pricing on the facility can now range from Libor plus 200 basis points to 300 bps, depending on ratings.

The amendment also prohibits the early pre-payment of senior notes and reduced permitted secured indebtedness to $25 million.

In addition, the definition of consolidated minimum tangible net worth was changed to $400 million less deferred tax asset valuation allowance.

The amendment was completed on March 27.

JPMorgan is the agent on the deal.

M/I Homes is a Columbus, Ohio-based homebuilder.

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