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Exhibit 10.10
CONSENT TO THE CREATION OF SUBSIDIARIES OF M/I SCHOTTENSTEIN
HOMES, INC. PURSUANT TO, AND FOURTH AMENDMENT TO, SECOND RESTATED
REVOLVING CREDIT LOAN AND STANDBY LETTER OF CREDIT AGREEMENT
This Consent to the Creation of Subsidiaries of M/I
Schottenstein Homes, Inc. Pursuant to, and Fourth Amendment to, Second Restated
Revolving Credit Loan And Standby Letter Of Credit Agreement (this "Amendment")
is made to be effective as of December 29, 1997, by and among M/I SCHOTTENSTEIN
HOMES, INC., an Ohio corporation ("Borrower"), BANK ONE, NA, a national banking
association, formerly known as Bank One, Columbus, N.A., a national banking
association ("Bank One"), THE HUNTINGTON NATIONAL BANK, a national banking
association ("HNB"), THE FIRST NATIONAL BANK OF CHICAGO, a national banking
association ("First Chicago"), NATIONAL CITY BANK OF COLUMBUS, a national
banking association ("NCB"), BANKBOSTON, N.A., a national banking association,
formerly known as The First National Bank of Boston, a national banking
association ("BOB"), THE FIFTH THIRD BANK OF COLUMBUS, an Ohio banking
corporation ("Fifth Third") (Bank One, HNB, First Chicago, NCB, BOB and Fifth
Third is each a "Bank" and, collectively, "Banks"), and BANK ONE, NA, a national
banking association, formerly known as Bank One, Columbus, N.A., a national
banking association, as agent for Banks ("Agent"). For valuable consideration,
the receipt of which is hereby acknowledged, Borrower, Banks and Agent, each
intending to be legally bound, hereby recite and agree as follows:
BACKGROUND INFORMATION
A. Borrower, Bank One, HNB, First Chicago, NCB, BOB, Fifth
Third and Agent are parties to a certain Second Restated Revolving Credit Loan
and Standby Letter of Credit Agreement effective as of December 30, 1996, as
amended by the First Amendment thereto effective as of March 14, 1997, the
Second Amendment thereto effective as of May 7, 1997 and the Third Amendment
thereto effective as of September 29, 1997 (the "Credit Agreement").
B. Borrower wants to form new limited liability companies (the
"LLCs") in connection with the development of a 522-acre tract of land located
in Prince William County, Virginia, near Manassas, Virginia, which tract is
referred to from time to time as "Bellwood" and is the subject of that certain
letter agreement between Borrower and Banks dated October
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15, 1997 and in connection with the development of a tract of land located in
Maryland.
C. Borrower, Banks and Agent want to amend the Credit
Agreement by modifying the definition of "Subsidiary" to encompass the LLCs, as
a result of which modification subsection 7.16 of the Credit Agreement will
require the prior written consent of the Required Banks to the formation of the
LLCs.
D. Subject to the terms and conditions of this Amendment and
of the Credit Agreement, the Banks want to consent to the formation of the LLCs.
E. Borrower, Banks and Agent want to amend the Credit
Agreement by providing for the LLCs and by modifying subsection 7.9, Limitation
on Investments, paragraph (g), which limits the investments by M/I Financial
Corp. in second mortgage loans for the purchase of residential real property.
AGREEMENT
1. Subject to the terms and conditions of this Amendment and
of the Credit Agreement, as amended hereby, Bank, Agent and Borrower each hereby
(a) consents to, and waives any Default solely as a result of, the formation by
Borrower of, as new Subsidiaries of Borrower, Lot 5 - 1997, L.L.C., a Virginia
limited liability company, Bellwood L.L.C., a Virginia limited liability
company, Manor Road - 1997, L.L.C., a Virginia limited liability company and
Chevy Chase Villas, L.L.C., a Virginia limited liability company.
2. Subsection 1.1, Defined Terms of the Credit Agreement is
hereby amended by deleting the definitions of each of "Construction Bonds,"
"Customer Deposits," "Eligible Developed Lots Sold," "Eligible Developed Lots
Unsold," "Eligible Model Houses," "Guaranties" and "Subsidiary" in their
entireties and replacing them, respectively, with the following:
"Construction Bonds" shall mean bonds issued by surety bond
companies for the benefit of, and as required by,
municipalities or other political subdivisions to secure the
performance by Borrower or any Subsidiary of its obligations
relating to lot improvements and subdivision development and
completion.
"Customer Deposits" shall mean cash deposits made by customers
of Borrower or any
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Subsidiary in connection with the execution of purchase
contracts, which deposits shall be shown as liabilities on
Borrower's consolidated financial statements.
"Eligible Developed Lots Sold" shall mean all Developed Lots
which Borrower or any Subsidiary has recorded as sold in
accordance with its usual accounting practices to any Person
other than an Affiliate or Subsidiary of Borrower. The value
of Eligible Developed Lots Sold shall be calculated in
accordance with GAAP and shall include all associated costs
required to be capitalized under GAAP, but shall be reduced by
the then outstanding aggregate amount of Indebtedness secured
by any Eligible Developed Lots Sold and permitted by
subsection 7.1(d) hereof.
"Eligible Developed Lots Unsold" shall mean all Developed Lots
which Borrower or any Subsidiary has not recorded as sold in
accordance with its usual accounting practices, or which
Borrower or any Subsidiary has recorded as sold to an
Affiliate or Subsidiary of Borrower. The value of Eligible
Developed Lots Unsold shall be calculated in accordance with
GAAP and shall include all associated costs required to be
capitalized under GAAP, but shall be reduced by the then
outstanding aggregate amount of Indebtedness secured by any
Eligible Developed Lots Unsold and permitted by subsection
7.1(d) hereof.
"Eligible Model Houses" shall mean (a) all completed detached
or attached single family houses (including townhouse
condominiums and condominiums) which are being used by
Borrower or any Subsidiary as sales models, and the lots on
which such houses are located and (b) detached or attached
(including townhouse condominiums and condominiums) single
family houses for which there has been a Start of Construction
which upon completion will be used by Borrower or any
Subsidiary as sales models, and the lots on which such houses
are located. The value of Eligible Model Houses shall be
calculated in accordance with GAAP
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and shall include all associated costs required to be
capitalized under GAAP except for the costs of any
furnishings, but shall be reduced by the then outstanding
aggregate amount of Indebtedness secured by any Eligible
Model Houses and permitted by subsection 7.1(d) hereof;
provided, however, that (a) the aggregate value of attached
(including townhouse condominiums and condominiums) single
family homes constituting Eligible Model Houses shall not
exceed $3,000,000, and (b) the aggregate value of all
Eligible Model Houses shall not exceed $30,000,000.
"Guaranties" (individually, "Guaranty") shall mean the
guaranties of the Indebtedness evidenced by this Agreement and
by all documents contemplated by this Agreement, including
without limitation the Notes, as this Agreement and such
documents may be amended or restated from time to time, which
guaranties are substantially in the form of Exhibit A attached
to this Agreement, executed by each of Borrower's Subsidiaries
(which are M/I Financial Corp., 601RS, Inc., M/I Homes, Inc.,
M/I Homes Construction, Inc., Bellwood L.L.C., Lot 5 - 1997,
L.L.C., Manor Road - 1997, L.L.C. and Chevy Chase Villas,
L.L.C.) in favor of the respective Banks and to which Agent
shall also be a party, and any guaranties in favor of Agent
and the respective Banks executed by (a) each other permitted
Subsidiary, if any, of Borrower and/or (b) the M/I Ancillary
Businesses that are wholly-owned by the Borrower or by any
Subsidiary.
"Subsidiary" shall mean as to any Person, a corporation,
limited liability company or other entity of which shares of
stock or other ownership interests having ordinary voting
power (other than stock or such other ownership interests
having such power only by reason of the happening of a
contingency) to elect a majority of the board of directors or
other managers of such corporation, limited liability company
or other entity are at the time owned, or the management of
which is otherwise controlled, directly, or indirectly
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through one or more intermediaries, or both, by such Person,
and with respect to Borrower shall include all Subsidiaries
of Subsidiaries of Borrower.
3. Subsection 1.1, Defined Terms, of the Credit Agreement is
hereby further amended by adding the following definitions thereto:
"Bellwood L.L.C." shall mean Bellwood L.L.C., a Virginia
limited liability company and a Subsidiary of Borrower, which
is owned 99% by Lot 5 - 1997, L.L.C. and 1% by KSI Services,
Inc., a Virginia corporation.
"Chevy Chase Villas, L.L.C." shall mean Chevy Chase Villas,
L.L.C., a Virginia limited liability company and a Subsidiary
of Borrower, which is owned 99% by Manor Road - 1997, L.L.C.
and 1% by KSI Services, Inc., a Virginia corporation.
"Lot 5 - 1997, L.L.C." shall mean Lot 5 - 1997, L.L.C., a
Virginia limited liability company and a wholly-owned
Subsidiary of Borrower.
"Manor Road - 1997, L.L.C." shall mean Manor Road - 1997,
L.L.C., a Virginia limited liability company and a
wholly-owned Subsidiary of Borrower.
4. Subsection 7.1, Limitation on Indebtedness, of the Credit
Agreement is hereby amended by deleting paragraph (i) in its entirety and
replacing it with the following paragraph (i):
(i) Indebtedness of any wholly-owned Subsidiary of Borrower,
or Indebtedness of Bellwood L.L.C. or Chevy Chase Villas,
L.L.C., with respect to loans from Borrower or from any other
Subsidiaries of Borrower; provided that each such Subsidiary
shall have delivered to each of the Banks, prior to the making
of any such loans, its respective Guaranty conforming to the
requirements of this Agreement; provided further that any such
Indebtedness of Bellwood L.L.C. shall not in the aggregate
exceed $3,500,000; and provided further that any such
Indebtedness
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of Lot 5- 1997, L.L.C. shall not in the aggregate exceed
$25,000,000; and
5. Subsection 7.2, Limitation on Liens, of the Credit
Agreement is hereby amended by deleting paragraph (g) in its entirety and
replacing it with the following paragraph (g):
(g) (i) deposits to secure the performance of: bids;
trade contracts (other than for borrowed money or the purchase
price of property or services); leases; statutory and other
obligations required by law; surety, appeal and performance
bonds (including Construction Bonds); and other obligations of
a like nature incurred in the ordinary course of business; and
(ii) Liens in favor of surety bond companies pursuant to
indemnity agreements to secure the reimbursement obligations
of Borrower or any Subsidiary on Construction Bonds, provided
(A) the Liens securing Construction Bonds shall be limited to
the assets of, as appropriate, Borrower or such Subsidiary at,
and the rights of, as appropriate, Borrower or such Subsidiary
arising out of, the projects that are the subject of the
Construction Bonds, (B) the Liens shall not attach to any real
estate, and (C) the aggregate amount of such Liens at any time
shall not exceed the dollar amount of Construction Bonds then
outstanding, and in any event shall not exceed the amount of
reimbursement obligations on Construction Bonds permitted to
Borrower pursuant to subsection 7.3(a) hereof;
6. Subsection 7.6, Limitation on Dividends, of the Credit
Agreement is hereby amended by deleting it in its entirety and replacing it with
the following subsection 7.6:
7.6 Limitation on Dividends and Distributions. Make
any distributions or declare any dividends (other than
dividends payable solely in common stock of Borrower) on, or
make any payment on account of, or set apart assets for a
sinking or other analogous fund for, the purchase, redemption,
retirement or other acquisition of any shares of any class of
stock of Borrower, whether now or
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hereafter outstanding, or make any other distribution in
respect thereof, either directly or indirectly, whether in
cash or property or in obligations of Borrower or any of its
Subsidiaries (each of the foregoing a "Stockholder
Payment"), except (a) so long as no Default or Event of
Default has occurred and is continuing or would result
therefrom, Borrower and any of its Subsidiaries may make
Stockholder Payments in a total amount that, when added to
all other Stockholder Payments permitted by this Agreement,
does not exceed the sum of (i) twenty-five percent (25%) of
cumulative Consolidated Earnings (taking into account
losses, if any) of Borrower subsequent to December 31, 1994
plus (ii) $5,000,000; and (b) any Subsidiary of Borrower may
declare and pay dividends or make distributions, and such
dividends or distributions shall not be considered
Stockholder Payments. In determining compliance with the
foregoing, Borrower shall be in compliance if, as of the
last day of the calendar month immediately preceding the
month in which any such Stockholder Payments are made, the
cumulative Stockholder Payments previously made plus the
Stockholder Payments made during the current month would not
in the aggregate exceed the amount permitted by clause (a),
above.
7. Subsection 7.7, Limitation on Certain Real Property
Expenditures, of the Credit Agreement is hereby amended by deleting it in its
entirety and replacing it with the following subsection 7.7:
7.7 Limitation on Certain Real Property Expenditures.
Purchase or acquire any Eligible Raw Land and Land Under
Development by the expenditure of cash, the incurrence of
Indebtedness, as a result of Investment in Joint Venture(s),
or otherwise, if as a result of such purchase or acquisition
the aggregate cost of all the foregoing then owned by Borrower
and its Subsidiaries (including their pro rata share of any
undeveloped land that constitutes part of an Investment in
Joint Venture) shall exceed (a) as to undeveloped land only,
$55,000,000; and (b) as to the sum of undeveloped land and
land under
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development, $100,000,000; provided further, that the
aggregate cost of any individual tract of land acquired by
Borrower or any of its Subsidiaries, or their pro rata share
of any tract that constitutes part of an Investment in Joint
Venture may not exceed $2,000,000 except for land holdings set
forth on Exhibit G attached hereto and except for Bellwood (as
hereinafter defined); and, provided further, that the
aggregate cost (net of any cash received from the sale of land
or lots) to Borrower and all of its Subsidiaries with respect
to the purchase or acquisition and the development of the
522-acre tract of land located in Prince William County,
Virginia near Manassas, Virginia, which tract is referred to
from time to time, and herein, as "Bellwood," shall not at any
time exceed $25,000,000. For purposes of this subsection 7.7,
the cost of undeveloped land and land under development shall
be determined in accordance with GAAP. Further, for purposes
of this subsection 7.7, any tract of land shall cease to be
classified as undeveloped land after (i) commencement of the
development of such tract into residential lots in good faith
and provided the development thereof is completed over a
period of not more than one year, or (ii) such tract is the
subject of a valid, noncontingent contract of sale with a
person who is not an Affiliate or Subsidiary and who is
satisfactory to the Required Banks in their sole discretion,
provided the sale contemplated by such contract is to be
completed not more than two years after the date of the
contract. In the event the development of any tract is
discontinued for a period of 60 days or longer or not
completed within one year, such tract shall automatically be
deemed to be undeveloped land.
8. Subsection 7.9, Limitation on Investments, of the Credit
Agreement is hereby amended by deleting paragraphs (d) and (g) in their
entireties and replacing them with the following paragraphs (d) and (g):
(d) any investments in M/I Financial Corp., 601RS,
Inc., M/I Homes, Inc., M/I
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Homes Construction, Inc., Lot 5 - 1997, L.L.C., Bellwood
L.L.C., Manor Road - 1997, L.L.C. or Chevy Chase Villas,
L.L.C. or any other Subsidiary created with the consent of the
Required Banks hereafter; provided that the aggregate cost
(net of any repayments, distributions or dividends) of
investments by Borrower and all of the Subsidiaries in
Bellwood L.L.C. shall not at any time exceed $25,000,000; and
provided further that the aggregate cost (net of any
repayments, distributions or dividends) of investments by
Borrower and all of the Subsidiaries in Lot 5 - 1997, L.L.C.
shall not at any time exceed $25,000,000;
(g) second mortgage loans made in the ordinary course
of M/I Financial Corp.'s business to natural persons for the
purchase of residential real property, provided that such
second mortgage loans (i) shall be made only in connection
with a specific financing program to natural persons who have
a first mortgage loan from M/I Financial Corp. with respect to
the same real property, and (ii) shall not in the aggregate
exceed $4,000,000 at any one time outstanding;
9. The Credit Agreement is hereby amended by deleting the
existing Exhibit G - Certain Land Holdings in its entirety and replacing it
with, and fully incorporating by this reference therein, amended Exhibit G
thereto, which amended Exhibit G is attached hereto.
10. In order to induce Banks and Agent to enter into this
Amendment, Borrower hereby represents and warrants to each Bank and to Agent
that on the date hereof:
(a) it has the corporate power and authority to make,
deliver and perform this Amendment and to borrow under the
Credit Agreement as amended by this Amendment and has taken
all corporate action necessary to be taken by it to authorize
the borrowings on the terms and conditions of the Credit
Agreement as amended by this Amendment and to authorize the
execution, delivery and performance of the Credit Agreement as
amended by this Amendment;
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(b) each of the Subsidiaries (i) is duly organized,
validly existing and in good standing under the laws of the
jurisdiction of its incorporation, (ii) has the corporate
power and authority to conduct the business in which it is
currently engaged, (iii) is qualified as a foreign corporation
under the laws of any jurisdiction where the failure to so
qualify would have a material adverse effect on the business
of Borrower and its Subsidiaries taken as a whole, and (iv) is
in compliance with all Requirements of Law except to the
extent that the failure to comply therewith would not, in the
aggregate, have a material adverse effect on the business,
operations, property or financial or other condition of
Borrower and its Subsidiaries taken as a whole and would not
materially adversely affect the ability of Borrower to perform
its obligations under this Agreement and the Notes.
(c) the execution, delivery and performance of the
Guaranty by each of Lot 5 - 1997, L.L.C., Bellwood L.L.C.,
Manor Road - 1997, L.L.C. and Chevy Chase Villas, L.L.C. will
not violate any Requirement of Law or Contractual Obligation
of such Subsidiary and do not and will not result in, or
require, the creation or imposition of any Lien on any of its
properties or revenues pursuant to any Requirement of Law or
Contractual Obligation.
(d) Schedule 3 attached hereto contains the name,
principal place of business, all other places of business and
percentage of ownership of all of the Subsidiaries of
Borrower.
11. The Credit Agreement is hereby amended by deleting the
existing Schedule 3 (Subsidiaries) thereto in its entirety and replacing it
with, and fully incorporating by reference therein, amended Schedule 3 thereto,
which amended Schedule 3 is attached hereto.
12. The Credit Agreement, including without limitation
Borrower's representations, warranties and covenants, as amended by this
Amendment, shall remain in full force and effect in
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accordance with its terms as amended hereby, and upon the effective date of this
Amendment, the terms "Agreement" and "this Agreement" shall mean the Credit
Agreement as amended by this Amendment.
13. The obligations of Agent and Banks pursuant to this
Amendment are subject to the satisfaction of the following conditions precedent
prior to the effective date of this Amendment:
(a) Guaranties. Each Bank shall have received from
each of Lot 5 - 1997, L.L.C., Bellwood L.L.C., Manor Road -
1997, L.L.C. and Chevy Chase Villas, L.L.C. its respective
Guaranty, to which Agent shall also be a party, conforming to
the requirements of the Credit Agreement and delivered by a
duly authorized officer of each of Lot 5 - 1997, L.L.C.,
Bellwood L.L.C., Manor Road - 1997, L.L.C. and Chevy Chase
Villas, L.L.C.
(b) Guarantor's Consent and Reaffirmation of
Guaranties. Each Bank and Agent shall have received from each
of M/I Financial Corp., 601RS, Inc., M/I Homes, Inc. and M/I
Homes Construction, Inc. an executed copy of its respective
Guarantor's Consent and Reaffirmation of Guaranties (in form
and substance satisfactory to Agent).
(c) Proceedings of Borrower. Each Bank and Agent
shall have received a copy of the resolutions (in form and
substance satisfactory to Agent) of the Executive Committee of
the Board of Directors of Borrower authorizing the execution,
delivery and performance of this Amendment, certified by the
Secretary or the Assistant Secretary of Borrower as of the
date hereof. Such certificate shall state that the resolutions
set forth therein have not been amended, modified, revoked or
rescinded as of the effective date of this Amendment.
(d) Proceedings of Subsidiaries of Borrower. Each
Bank and Agent shall have received a copy of the resolutions
(in form and substance satisfactory to each Bank and Agent) of
(i) M/I Schottenstein Homes, Inc.,
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as the sole shareholder of each of M/I Financial Corp., 601RS,
Inc., M/I Homes, Inc. and M/I Homes Construction, Inc., and as
the sole member of Lot 5 - 1997, L.L.C. and Manor Road - 1997,
L.L.C.; (ii) Lot 5 - 1997, L.L.C. and KSI Services, Inc., as
the sole members of Bellwood L.L.C.; and (iii) Manor Road -
1997, L.L.C. and KSI Services, Inc., as the sole members of
Chevy Chase Villas, L.L.C., each resolution authorizing the
execution, delivery and performance of (y) by Lot 5 - 1997,
L.L.C., Bellwood L.L.C., Manor Road - 1997, L.L.C. and Chevy
Chase Villas, L.L.C., the respective Guaranties of each, and
(z) by M/I Financial Corp., 601RS, Inc., M/I Homes, Inc., and
M/I Homes Construction, Inc., Guarantor's Consent and
Reaffirmation of Guaranties, all certified by the Secretary or
Assistant Secretary of each respective Subsidiary of Borrower
as of the date hereof. Such certificate shall state that the
resolutions set forth therein have not been amended, modified,
revoked or rescinded as of the effective date of this
Amendment.
(e) Incumbency Certificates of Subsidiaries. Each
Bank and Agent shall have received a certificate of the
Manager, or other appropriate person, of each of Lot 5 - 1997,
L.L.C., Bellwood L.L.C., Manor Road - 1997, L.L.C. and Chevy
Chase Villas, L.L.C., dated the date hereof, as to the
incumbency and signatures of the Manager, or other appropriate
person(s), of each executing its respective Guaranty.
(f) No Default or Event of Default. No Default or
Event of Default shall have occurred and be continuing under
the Credit Agreement as of the effective date of this
Amendment.
14. This Amendment may be executed by one or more of the
parties to this Amendment on any number of separate counterparts and all of said
counterparts taken together shall be deemed to constitute one and the same
instrument. This Amendment shall become effective upon receipt by Agent and each
Bank of executed counterparts of this Amendment by each of Borrower, Agent and
the Required Banks.
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15. This Amendment shall be governed by, and construed in
accordance with, the local laws of the State of Ohio.
[THE REMAINDER OF THIS PAGE IS INTENTIONALLY LEFT BLANK.]
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IN WITNESS WHEREOF, Borrower, Banks and Agent have caused this
Amendment to be duly executed and delivered by their proper and duly authorized
officers as of the day and year first above written.
M/I SCHOTTENSTEIN HOMES, INC.
By /s/ ROBERT H. SCHOTTENSTEIN
-----------------------------------------
Robert H. Schottenstein
Title: President and Assistant Secretary
BANK ONE, NA,
as Agent and as a Bank
By /s/ THOMAS D. IGOE
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Thomas D. Igoe
Title: Senior Vice President
THE HUNTINGTON NATIONAL BANK
By /s/ R.H. FRIEND
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R.H. Friend
Title: Vice President
THE FIRST NATIONAL BANK OF CHICAGO
By /s/ GREGORY A. GILBERT
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Gregory A. Gilbert
Title: Vice President
NATIONAL CITY BANK OF COLUMBUS
By /s/ RALPH A. KAPAROS
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Ralph A. Kaparos
Title: Senior Vice President
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BANKBOSTON, N.A.
By /s/ KEVIN C. HAKE
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Kevin C. Hake
Title: Director
THE FIFTH THIRD BANK OF COLUMBUS
By /s/ MARK E. RANSOM
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Mark E. Ransom
Title: Vice President
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GUARANTOR'S CONSENT AND REAFFIRMATION OF GUARANTIES
The undersigned Guarantor hereby (a) acknowledges that it has
read the foregoing Consent to the Creation of Subsidiaries of M/I Schottenstein
Homes, Inc. Pursuant to, and Fourth Amendment to, Second Restated Revolving
Credit Loan and Standby Letter of Credit Agreement, effective as of September
29, 1997 (the "Fourth Amendment"), and (b) agrees that the undersigned
Guarantor's Guaranty dated as of December 30, 1996 of the obligations of M/I
Schottenstein Homes, Inc. pursuant to the Second Restated Revolving Credit Loan
and Standby Letter of Credit Agreement, as amended by the First Amendment
thereto effective as of March 14, 1997, the Second Amendment thereto effective
as of May 7, 1997, the Third Amendment thereto effective as of September 29,
1997 and the Fourth Amendment, and all representations, warranties and covenants
in such Guaranty, continue in full force and effect notwithstanding the Fourth
Amendment.
M/I FINANCIAL CORP.
By: /s/ PAUL S. ROSEN
------------------------------------------
Paul. S. Rosen
Title: President
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GUARANTOR'S CONSENT AND REAFFIRMATION OF GUARANTIES
Each of the undersigned Guarantors hereby (a) acknowledges
that it has read the foregoing Consent to the Creation of Subsidiaries of M/I
Schottenstein Homes, Inc. Pursuant to, and Fourth Amendment to, Second Restated
Revolving Credit Loan and Standby Letter of Credit Agreement, effective as of
September 29, 1997 (the "Fourth Amendment"), and (b) agrees that each of the
undersigned Guarantor's Guaranties dated as of March 14, 1997 of the obligations
of M/I Schottenstein Homes, Inc. pursuant to the Second Restated Revolving
Credit Loan and Standby Letter of Credit Agreement, as amended by the First
Amendment thereto effective as of March 14, 1997, the Second Amendment thereto
effective as of May 7, 1997, the Third Amendment thereto effective as of
September 29, 1997 and the Fourth Amendment, and all representations, warranties
and covenants in each of such Guaranties, continue in full force and effect
notwithstanding the Fourth Amendment.
601RS, INC.
M/I HOMES, INC.
M/I HOMES CONSTRUCTION, INC.
By: /s/ ROBERT H. SCHOTTENSTEIN
------------------------------------------
Robert H. Schottenstein
President and Assistant Secretary of 601RS, Inc.;
Vice Chairman of M/I Homes, Inc.; and
Vice Chairman of M/I Homes Construction, Inc.