Orleans Homebuilders amends loan to change size, pricing, covenants

By Sara Rosenberg

New York, Feb. 11 - Orleans Homebuilders Inc. amended its credit facility, decreasing the size to $405 million from $440 million, with a further reduction to $375 million on July 16, increasing pricing and revising covenants, according to a news release.

Pricing on the facility was raised by 25 basis points to Libor plus 525 bps.

Covenant modifications included reductions in minimum consolidated tangible net worth, cash flow from operations, minimum liquidity and maximum cash covenants.

In addition, the amendment improved the borrowing base availability calculation by decreasing certain category limitations.

"With the help of our lending group, we have secured this important bank amendment, which will provide us with added liquidity and flexibility to manage in these difficult times. It is a challenging environment, but we have made good progress on our stated objectives, and we have a strong and experienced team that is managing through it," said Jeffrey P. Orleans, chairman of the board and chief executive officer, in the release.

Orleans Homebuilders is a Bensalem, Pa.-based residential homebuilder.

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