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FORM 10-K
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
/ X / ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934 (FEE REQUIRED)
For the fiscal year ended December 31, 1995
OR
/ / TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934 (NO FEE REQUIRED)
For the transition period from to
Commission File No. 33-44914, 33-68564
M/I SCHOTTENSTEIN HOMES, INC.
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(Exact name of registrant as specified in its charter)
Ohio 31-1210837
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(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
41 S. High Street, Suite 2410
Columbus, Ohio 43215
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(Address of principal executive offices)(zip code)
Registrant's telephone number, including area code: (614) 221-5700
SECURITIES REGISTERED PURSUANT TO SECTION 12(b) OF THE ACT:
Name of Each Exchange on
Title of Each Class Which Registered
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Common Stock, par value $.01 New York Stock Exchange
SECURITIES REGISTERED PURSUANT TO SECTION 12(g) OF THE ACT:
None
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(Title of Class)
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days. Yes X . No .
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Indicate by check mark if disclosure of delinquent filers pursuant to Item
405 of Regulation S-K is not contained herein, and will not be contained, to the
best of registrant's knowledge, in definitive proxy or information statements
incorporated by reference in Part III of this Form 10-K or any amendment to this
Form 10-K. [ ]
As of March 8, 1996, the aggregate market value of voting common stock held
by non-affiliates of the registrant (3,424,300 shares) was approximately
$36,383,000. The number of shares of common stock of M/I Schottenstein Homes,
Inc., outstanding on March 8, 1996 was 8,800,000.
DOCUMENTS INCORPORATED BY REFERENCE
Portions of Annual Report to Shareholders for the year ended December 31, 1995
(Part I and II) Portions of the registrant's Definitive Proxy Statement for the
1996 Annual Meeting of Shareholders to be filed pursuant to Regulation 14A not
later than April 8, 1996 (Part III)
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PART I
ITEM 1. BUSINESS
COMPANY
M/I Schottenstein Homes, Inc. was reincorporated in Ohio in November 1993.
Prior to that date, the Company was a Delaware corporation. As used in this
report, the term "Company" refers to M/I Schottenstein Homes, Inc.; its
subsidiary, M/I Financial Corp. ("M/I Financial") and its predecessors, unless
the context indicates otherwise. The Company maintains its executive offices at
41 South High Street, Suite 2410, Columbus, Ohio 43215 and its telephone number
is (614) 221-5700.
During October 1986, the Company completed a public offering of its Common
Stock and from October 1986 to June 1990, the Company was publicly held, with
Irving E. Schottenstein, Melvin L. Schottenstein and their family trusts owning
approximately 79.0% of the outstanding shares of Common Stock. In June 1990, the
shareholders of the Company approved a merger agreement providing for the merger
of the Company with M/I Homes Acquisition Corp., a corporation formed by Irving
E. Schottenstein, Melvin L. Schottenstein and their family trusts as a vehicle
for acquiring the Company's publicly held Common Stock (the "Going Private
Transaction"). As a result, Irving E. Schottenstein, Melvin L. Schottenstein and
their family trusts became the holders of 100% of the Common Stock. Effective
January 1, 1991, the Company elected to be treated as an S Corporation under the
Internal Revenue Code of 1986, as amended (the "Code") for federal income tax
purposes and comparable state tax laws. As a result of the S Corporation
election, the Company was no longer subject to federal and state income taxation
and its shareholders were taxed on the Company's income directly.
In November 1993, the Company completed a public offering of its Common
Stock, selling 3.3 million shares at an initial public offering price of $14 per
share. At that time, the remaining 62.5% of the Company's outstanding Common
Stock was held by Irving E. Schottenstein, the Estate of Melvin L. Schottenstein
and their family trusts, the former S Corporation shareholders. In conjunction
with the public offering, the Company terminated its S Corporation status
effective November 8, 1993. Accordingly, from that date forward, the Company's
income has been fully subject to federal, state and local taxes.
SEGMENT INFORMATION
The Company operates in two business segments - home-building and financial
services. The home-building operations include the development of land and the
sale and construction of single-family attached and detached homes. The
financial services operations involve the origination of mortgage loans
primarily for purchasers of the Company's homes. The financial information
relating to business segments for the three years ended December 31, 1995,
appearing in exhibit 13 of this Annual Report on Form 10-K, is incorporated by
reference.
HOME-BUILDING
M/I Schottenstein Homes, Inc. is one of the nation's leading home builders.
The Company is engaged in the sale and construction of single family homes
marketed and sold under the M/I Homes and Showcase Homes tradenames. In 1994,
the latest year for which information is available, the Company was the
twentieth largest U.S. home builder (based on total revenue) as ranked by
Builder Magazine. During the year ended December 31, 1995, the Company delivered
2,952 homes with a total sales value of over $505 million.
The Company commenced home-building operations in Columbus, Ohio in 1976
and expanded into and opened a home-building division in Tampa, Florida in 1981.
In 1984 the Company further expanded in Florida by opening home-building
divisions in Palm Beach County and Orlando. The Company opened home-building
divisions in Charlotte and Raleigh, North Carolina in 1985 and 1986,
respectively. The Company opened a home-building division in Nashville,
Tennessee in 1987 and, due to the lack of perceived growth opportunities,
withdrew
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from this market in December 1989. In 1988, the Company established a separate
home-building division for its Showcase product lines in Columbus, Ohio with the
intent of building and marketing semi-custom, upscale homes to more affluent
customers. It was also in 1988 that the Company expanded into and opened
home-building divisions in Cincinnati, Ohio and Indianapolis, Indiana. In 1991,
the Company opened a home-building division in Washington D.C., encompassing
certain D.C. suburbs located in Virginia and Maryland. Due to the growth in the
Washington, D.C. market, the Company split this market into separate Maryland
and Virginia divisions in the first quarter of 1994. In May 1993, the Company
introduced its Horizon line of homes in the Columbus market. This is the
Company's lowest priced line of homes and is targeted primarily at first time
home buyers. Due to the strong sales of this line since its introduction and the
anticipated growth in this segment of the market, the Company established a
separate division for the Horizon line in the Columbus market in 1994. The
Company also introduced this line of entry-level homes in several of its other
markets in 1994 and 1995. The Company is the leading home builder in its core
Columbus market and the Company's Columbus divisions accounted for approximately
40% of the Company's housing revenue in 1995. Each home-building division is
managed by a division manager who is familiar with the unique market
characteristics of their particular division. As commonly occurs in the
home-building industry, it has been the Company's experience that it incurs
substantial losses in a new market for the first two years of operations. With
respect to the Company's nine developing markets, these losses have already been
absorbed in the Company's historical results of operations. In addition, the
Company continues to explore opportunities for expanding into new markets either
by starting a new division or through acquisition.
The Company, on a regional basis, offers up to eight distinct lines of
single family homes ranging in price from the low $80,000's to approximately
$500,000, with an average sales price of homes in Backlog as of December 31,
1995 of $169,000. By offering a wide range of homes, the Company is able to
attract first-time home buyers as well as move-up buyers, many of whom were
previous M/I or Showcase homeowners. The Company seeks to distinguish itself
from its competitors by offering homes that have a higher level of design and
construction quality within a given price range. The Company also believes that
it offers one of the highest levels of customer service in the industry. Based
on the responses to our customer questionnaire, for the fifth year in a row,
more than 95% of the Company's customers would recommend an M/I or Showcase home
to a potential home buyer.
The Company believes that each of its markets has unique characteristics
and must therefore be locally managed with dedicated, on-site management
personnel. Each home-building division is supervised by a division manager who
reports to a regional manager. The Company encourages its regional and division
managers to be entrepreneurial and has accordingly adopted an incentive
compensation structure under which their aggregate compensation is largely
determined on the basis of net income and customer satisfaction in their region
or division.
To enhance the selling process, the Company operates design centers in the
Cincinnati and Columbus markets. The design centers are staffed with interior
design specialists who assist Columbus and Cincinnati customers in selecting
interior and exterior colors as well as standard options and upgrades. In its
other markets, the color selection and option/upgrade process is handled
directly by the companies sales consultants.
FINANCIAL SERVICES
The Company offers fixed and adjustable rate mortgage loans, primarily to
buyers of the Company's homes through its wholly owned subsidiary M/I Financial.
At December 31, 1995, the Company is committed to fund $55.0 million in mortgage
loans to home buyers. Of this total, approximately $6.0 million are adjustable
rate loans and $49.0 million are fixed rate loan commitments. The loans are
granted at current market interest rates and the rate is guaranteed through the
transfer of the title of the home to the buyer (the "Closing"). The Company uses
hedging methods to reduce its exposure to interest rate fluctuations between the
commitment date of the loan and the time the home closes. The method to be used
is determined at the time of the loan commitment based on the market conditions
and alternatives available. The Company's policy requires that there be no
interest rate risk on loans closed waiting to be sold. Also according to the
policy, the pipeline of committed loans is to be hedged at 70 to 95% of the
committed balance which is the balance of loans expected to be closed.
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One of the methods the Company uses to hedge the interest rate risk
relative to unclosed loans is to purchase commitments from outside investors to
acquire the loans at the interest rate at which the loan will be closed. The
cost of these purchase commitments is recorded as an asset and is expensed as
loans are closed under the related commitments. Any remaining unused balance is
expensed when the commitment expires or earlier, if the Company determines that
they will be unable to use the entire commitment prior to its expiration date.
At December 31, 1995, the Company had approximately $36.0 million of commitments
to deliver mortgage loans to outside investors.
The Company hedges its interest rate risk using forward sales of
mortgage-backed securities whereby the Company agrees to sell and later
repurchase similar but not identical mortgage-backed securities. Generally, the
agreements are fixed-coupon agreements whereby the interest rate and maturity
date of both transactions are approximately the same and are established to
correspond with the closing of the fixed interest rate mortgage loan commitments
of the Company. The difference between the two values of the mortgage-backed
securities in the agreements at settlement provide a hedge on the interest rate
risk exposure in the mortgage loan commitments and is included in the gain or
loss on the sale of the loans to third party investors. At December 31, 1995,
these agreements matured within 90 to 120 days. Securities under forward sales
agreements averaged approximately $12.5 million during 1995 and the maximum
amounts outstanding at any month end during 1995 was $16.0 million, the balance
at December 31, 1995. Hedging gains of $456,000 were deferred at year end as the
mortgage loans and commitment contracts qualified for hedge accounting.
To reduce the credit risk associated with accounting losses, which would be
recognized if the counterparties failed completely to perform as contracted, the
Company limits the entities that management can enter into a commitment with to
the primary dealers in the market. The risk of accounting loss is the difference
between the market rate at the time a counterparty fails and the rate the
Company committed to for the mortgage loans and any purchase commitments
recorded with the counterparty.
M/I Financial is currently in the process of opening an office in Raleigh
at which time they will have branches in all of the Company's housing markets,
with the exception of Virginia and Maryland. M/I Financial provided financing
for 1,873 homes in 1995, representing approximately $233.3 million of mortgage
loans originated. The majority of these loans were made to buyers of the
Company's homes. M/I Financial issues commitments to customers and closes both
conventional and government-insured loans in its own name. However, in an effort
to minimize the risk of financing activities, M/I Financial generally sells the
loans it originates to the secondary market which provides the funding within
several days thereafter. The Company retains a small servicing portfolio which
it currently sub-services with a financial institution.
M/I Financial has been approved by the Department of Housing and Urban
Development and the Veterans Administration to originate loans insured by the
FHA and the VA, respectively, and has been approved by the Federal Home Loan
Mortgage Corporation ("FHLMC") and by the Federal National Mortgage Association
("FNMA") as a seller and servicer of mortgages sold to FHLMC and FNMA.
BUSINESS STRATEGY
The Company's business strategy emphasizes the following key areas: (i)
profitability with focus on margins as well as expenses; (ii) having and
continuing to pursue premier locations while maintaining a conservative land
acquisition policy; (iii) maintaining a leadership position in Columbus and
pursing profitable growth strategies in other markets; (iv) superior customer
service; (v) product breadth and innovative design; and (vi) employing an
experienced and entrepreneurial management team. Growth and performance
expectations are always subject to changes in interest rates, the home-building
industry's competitive environment, job growth and consumer confidence. The
Company adapts to these constant changes by focusing on the following strategies
and philosophies that have been key to its success:
(i) Profitability. The overriding business strategy of the company is to
increase profitability and focus on margins in order to enhance shareholder
value. At the same time, the Company remains committed to its core
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business practice of building quality homes and providing superior customer
service. Although, there are times when increasing profits may conflict with
issues of quality and customer service, the Company believes that it has been
particularly successful in striking the proper balance between these vital
Company goals. In order to do this, the Company constantly explores new methods
and procedures designed to improve operating efficiency without sacrificing
quality. In the selling process, the marketing sales efforts of the Company
promote credibility and quality rather than price cutting or so-called "give
aways". In each home building division, significant attention is paid to
improving subdivision absorption as well as revenue enhancement through premiums
and price increases where warranted. Management believes the Company's
long-standing and very conservative policy against "spec" houses allowed the
Company to avoid the significant discounting which may accompany the sale of a
"spec" house. The Company strives to be in locations where the Company is the
primary builder or, if not, the Company seeks to build in communities with other
builders who have similiar risk/return philosophies. The Company is constantly
exploring ways in which to make money without selling additional homes. In
support of this, the Company continues to promote value engineering of its
product lines. The Company strives to grow M/I Financial in the majority of its
markets. The Company is considering two strategies that may be implemented in
1996 to improve profitability. The first strategy is to reduce its tax and legal
liabilities through restructuring. The second strategy is to participate in a
joint venture to capture title insurance profits in certain of its markets. The
implementation of these strategies in 1996 is dependent upon a number of factors
such as possible regulatory approval, administrative costs of the
implementation, and analysis of the level of increased revenue that will be
realized by the Company. Therefore, this objective of improving profitability
during 1996 is a forward-looking statement that is subject to change as the
Company evaluates the effect of the above mentioned factors upon the two
strategies. Finally, the Company will continue to pursue ways to reduce its
overall cost of capital as well as maintain financial flexibility.
(ii) Premier Locations and Conservative Land Acquisition Policy. The
Company understands that the profitability of each of its home building
divisions is largely dependent upon the quality of the division's subdivision
locations. When the market is strong, the good locations truly excel and when
the market weakens, the good locations are usually the last to be affected. The
Company has always been effective at securing good locations and with the recent
internal formation of the Land Committee, the Company believes it will become
even more effective in identifying and acquiring premier locations.
The Company's land development activities and land holdings have increased
significantly in the past few years and the Company expects land holdings to
remain at relatively high levels. However, the Company has always pursued and
continues to pursue a land acquisition policy that it believes is more
conservative than the policies of the other national home builders. The Company
develops its own lots where it can gain a competitive advantage by doing so or
where shortages of qualified land developers make it impractical to purchase the
required lots from outside sources. The Company seeks to limit its investment in
undeveloped land and lots to the amount reasonably expected to be sold in the
next three to four years. All land to be acquired by the Company must be zoned
and serviceable by all necessary utilities prior to being purchased. From time
to time, the Company develops land in joint ventures which, in most cases, are
entirely equity financed. As of December 31, 1995, the Company had an inventory
of 2,141 developed lots, 912 lots under development and 2,281 lots zoned for
future development, including its share of lots owned by its joint ventures. The
Company believes that this level of land inventory, in combination with 5,769
lots that the Company may acquire pursuant to outstanding option and purchase
contracts, is sufficient to meet its anticipated building needs over the next
three to four years.
(iii) Maintaining Leading Position in the Columbus Market and Profitable
Growth Strategies in Other Markets. The Company is the leading builder of
single-family detached homes in the Columbus market. In fact, the Company has
built and delivered the greatest number of single-family detached homes in the
Columbus area during each of the last seven years. In 1995, the Company's market
share in Columbus reached a record setting 25% of the total market and more than
27% of the "under $250,000" market. The Company seeks to maintain its leading
position in this market by continuing to provide high quality homes and superior
customer service. Its success in Columbus has enabled the Company to expand into
new markets that offer significant growth opportunities.
Between 1981 and 1993, the Company expanded into and currently operates
home-building divisions in nine markets outside its original Columbus market.
The Company believes there are significant opportunities to
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improve profitability in these markets through expansion of the Company's
product offerings, the acquisition of land in increasingly desirable locations
and by constructing and selling homes with the same commitment to customer
service that has accounted for the Company's success in its Columbus market. In
addition, the Company continues to explore opportunities for expanding into new
markets whether by starting a new division or through acquisition. In developing
proper growth strategies and goals for its other markets, however, the Company
understands that the unique characteristics of each market significantly impacts
the long-term strategies which the Company elects to pursue. Regardless of the
strategies employed, the Company will continue to focus on profitability rather
than mere market share.
(iv) Superior Customer Service. The Company is committed to providing its
home buyers with a wide array of functional and innovative designs from which to
choose, quality construction utilizing the best building materials and a home
with lasting value at an affordable price. The overriding Company philosophy is
to provide superior service to its customers. The Company has always recognized
that the purchase of a home in most instances represents the single largest
investment ever made by its customers. The Company understands the importance of
a home purchase decision and is sensitive to the fact that many prospective
buyers have little knowledge of home construction and are unsure about how to
choose a home builder and a home. Because of this, virtually every phase of the
Company's operations - from the beginning of the selling process through
construction, closing and service after delivery - is designed to educate and
inform the customer, to involve the customer in the home-building process and to
make the home-building experience more understandable and pleasant. The
Company's selling process focuses on the home's features, benefits, quality and
design (as opposed to merely emphasizing price and square footage). The Company
assists many of its customers with financing and conducts a pre-construction
"builder/buyer" conference with each customer to review the house plans,
introduce the customer to his or her construction supervisor and explain the
construction process. The Company encourages its customers to visit their
homesites during construction and provides free periodic inspections of its
homes after delivery. The Company also offers attractive warranties, including a
20-year transferable major structural warranty. The Company prides itself on the
extraordinary efforts which it undertakes on a daily basis to "put the customer
first" and thereby provide the highest levels of customer service. As a result,
based on the responses to our customer questionnaire, for the fifth year in a
row, more than 95% of the Company's customers would recommend an M/I or Showcase
home to a potential home buyer.
(v) Product Breadth and Innovative Design. The Company offers a wide range
of homes at price points that appeal to both first-time and move-up buyers, as
well as empty nesters. The Company offers more than 200 different floor plans
and elevations in its various product lines. In some instances, the Company
permits customers, at an additional cost, to modify the design of their homes or
add special features. Such modifications are greatly facilitated by the
Company's use of computer-aided design technology. The Company believes that its
homes generally offer a higher level of quality design and construction within a
given price range. It devotes significant resources to the research, design and
development of its homes in order to better meet the needs of the various
housing markets in which the Company operates.
(vi) Management. The Company places high value on and dedicates substantial
resources to assembling the most competent management team at the corporate and
regional levels and within each of its divisions. The Company's success as a
national home builder is in large part due to the skill and experience of the
Company's managers, each of whom possess intimate knowledge of the markets they
manage. The Company encourages its managers to be entrepreneurial and to operate
their regions and divisions as if they were their own and, accordingly, has
adopted an incentive compensation structure under which aggregate compensation
for regional and division managers is determined on the basis of financial
performance and customer satisfaction in their region or division.
SALES AND MARKETING
The Company markets and sells its homes under the M/I and Showcase
tradenames. Home sales are conducted from on-site sales offices in furnished
model homes by the Company's own sales personnel. Every sales consultant is
trained and equipped to fully explain the features and benefits of the Company's
homes, to determine
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which home best suits each customer's needs, to explain the construction process
and to assist the customer in choosing the best financing. Significant attention
is paid to the training and re-training of all sales personnel to assure the
highest levels of professionalism and product knowledge. Overall, the Company
currently employs more than 127 sales consultants and operates approximately 160
model homes across all of its divisions.
The Company advertises in newspapers and in magazines, by direct mail, on
billboards and on radio and television, although the particular marketing medium
used differs from division to division based upon marketing demographics and
other competitive factors. In addition, the Company welcomes independent broker
participation and from time to time, utilizes various promotions and sales
incentives to attract interest from these brokers. The Company's commitment to
quality design and construction and reputation for customer service has also
resulted in a strong referral base and a significant number of repeat buyers.
The Company generally does not commence construction of its homes until it
obtains a sales contract and preliminary oral advice from the customer's lender
that financing will be approved. However, in certain markets, contracts are
sometimes accepted contingent upon the sale of an existing home and construction
is authorized through a certain stage prior to satisfaction of that contingency.
In addition, in all divisions, a limited number of "spec" homes, i.e., homes
started in the absence of an executed contract, are built in order to permit
construction and delivery of homes on an immediate-need basis and to provide
presentation of new product. The Company has always followed a very conservative
policy with respect to the number of spec homes that can be started. Management
strictly controls the number of spec homes that can be built by requiring that
the division manager obtain the Chief Executive Officer's approval prior to
start.
The Company's sales and marketing efforts are further enhanced by the
Company's inspection and warranty programs. Through these programs, the Company
offers a 2-year limited warranty on materials and workmanship and a 20-year
limited warranty against major structural defects. To increase the value of
these warranties, both are transferable in the event of the sale of the home.
Immediately prior to closing and three months after a home is delivered, the
Company inspects each home with the customer to determine if any repairs are
required. At the customer's written request, the Company will also provide a
free one year inspection and again make any necessary repairs. The Company also
passes along to its customers all warranties provided by manufacturers or
suppliers of components installed in each home. The Company's warranty expense
was less than 1.0% of total costs and expenses for each of the years ended
December 31, 1995, 1994, and 1993.
DESIGN AND CONSTRUCTION
The Company devotes significant resources to the research, design and
development of its homes in order to better meet the needs of the various
housing markets in which the Company operates. Virtually all of the Company's
floor plans and elevations are designed by an experienced in-house staff of
qualified professionals using modern computer-aided design technology. The
Company offers more than 200 different floor plans and elevations. These designs
may differ significantly from market to market. For example, in Florida, where
lifestyles tend to be more leisurely and outdoor oriented, home designs tend to
be more open and airy, with palladian windows, arches, gothic columns and
covered lanais. In the Midwest, home design is more traditional.
The construction of each home is supervised by a construction supervisor
employed by the Company who reports to a Company-employed production manager.
Every customer is introduced to their construction supervisor prior to
commencement of home construction at a pre-construction "builder/buyer"
conference. In addition to introducing the customer to their construction
supervisor, the purpose of the "builder/buyer" conference is to review with the
customer the home plans and all relevant construction details and to explain the
construction process and schedule to the customer. Every customer is given a
hard hat at the "builder/buyer" conference as an open invitation to visit the
site at any time during the course of construction. The Company wants the
customer to become involved and better understand the construction of their home
and to see the quality being built into their home. All of this is part of the
Company's philosophy to "put the customer first" and enhance the total
home-building experience.
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All homes are constructed according to standardized designs and meet
applicable Federal Housing Authority (the "FHA") and Veterans Administration
(the "VA") requirements. To allow maximum design flexibility, the Company limits
the use of pre-assembled building components and pre-fabricated structural
assemblies. The efficiency of the building process is enhanced by the Company's
use of standardized materials available from a variety of sources. The Company
has, from time to time, experienced construction delays due to shortages of
materials or subcontractors. Such construction delays may, in turn, delay the
delivery of homes, thereby extending the period of time between the signing of a
purchase contract with respect to a home and the receipt of revenue by the
Company; however, the Company cannot predict the extent to which shortages of
necessary materials or labor may occur in the future. The Company employs
independent subcontractors for the installation of site improvements and the
construction of its homes. Subcontractors are supervised by the Company's
on-site construction supervisors. All subcontractor work is performed pursuant
to written agreements with the Company. Such agreements are generally
short-term, with terms from six to twelve months, provide for a fixed price for
labor and materials and are structured so as to allow for price protection for
the Company's Backlog. The Company seeks to build in large volume with a view
toward reducing the per unit cost of the homes which it sells due to advantages
achieved by lower unit prices paid to subcontractors for labor and materials.
MARKETS
The Company's operations are organized into geographic regions in order to
maximize management and operating efficiencies. Each geographic region comprises
one or more operating divisions for a particular major metropolitan area. The
Company's present divisional operating structure is as follows:
Year
Operations
Region Division Commenced
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Ohio..................... Columbus - Horizon 1994
Columbus - Hallmark/Heritage/Regency 1976
Columbus - Showcase 1988
Cincinnati 1988
Florida.................. Tampa 1981
Orlando 1984
Palm Beach County 1984
Carolina................. Charlotte 1985
Raleigh 1986
Indiana.................. Indianapolis 1988
Washington D. C.......... Virginia 1991
Maryland 1991
A regional manager is responsible for and oversees all activities within
the divisions contained in their region and the division manager is responsible
for and oversees the activities within their particular division. Each division
manager has one or more sales managers and production managers reporting to
them. The sales manager supervises the sales consultants and the production
manager supervises the construction supervisors.
The home-building industry is highly competitive. The Company competes in
each of the geographic areas in which it operates with numerous other home
builders, ranging from small local to larger regional and national builders and
developers. The Company continually evaluates its markets, focusing on key data
such as population trends, job formation, income levels, housing demand and
supply and home-building competition.
Ohio Region. The Columbus market is a steady market with a stable and
diverse employment base. The Company is the leading home builder in its core
Columbus market based upon home closings, having built and delivered more
single-family detached homes in the Columbus area than any other home builder
during each of the last seven years. The Company seeks to maintain its leading
position in this market by expanding its product offerings and the locations
where it builds homes, while continuing to provide the high quality homes and
superior
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customer service on which the Company's reputation has been built. The Company's
success in Columbus has enabled the Company to expand into new markets which
offer significant growth opportunities.
The Cincinnati division was started in 1988. The Company believes
Cincinnati's market is characterized by a stable economic environment and a
diverse employment base. In 1994 and 1995, the Company introduced its more
affordable Horizon product line in this market in order to compete more
effectively for first time home buyers.
Florida Region. The Company commenced operations in Tampa in 1981. The
Tampa market continues to experience strong building permit activity after a
decline that began in the late 1980s. This increase has been driven by increased
jobs in the services, government and finance industries.
The Company opened the Palm Beach Division in 1984 and recently introduced
its Showcase product line in order to offer homes in more affluent areas of the
County. With the introduction of the Showcase product line and new subdivisions
opened in 1995, the Company believes it is well positioned in this market.
The Orlando division opened in 1984. Orlando's economy is anchored by the
service industry, representing approximately 33% of total employment. The
Orlando market has traditionally experienced lower unemployment rates than both
the state of Florida and the United States. Home builder competition remains
strong and the Company competes heavily in the areas of price and location. In
1995, the Company introduced its upscale product line in this market in order to
compete more effectively.
Carolina Region. The Company entered Charlotte and Raleigh in 1985 and
1986, respectively. Charlotte continues to grow as a financial center, with
Raleigh also attracting jobs as a leader in the research and development area.
The Company believes that Charlotte and Raleigh both continue to attract
well-educated, higher income level consumers.
Indiana Region. The Company opened the Indianapolis division in 1988. The
Indianapolis market is a growing market noted for an excellent transportation
system and a relatively young population. In 1995, the Company introduced its
Horizon product line in this market to offer more choices for first time home
buyers. This division recorded a record number of New Contracts in 1995,
primarily due to the strong performance of the Horizon product line.
Washington, D.C. Region. The Washington, D.C. division was opened in late
1991. In 1994, operations were split into separate Maryland and Virginia
divisions to more effectively manage this market. Current operations are
primarily located in Fairfax, Prince William and Loudoun Counties in Virginia
and Prince Georges, Montgomery and Anne Arundel Counties in Maryland. The
Company has experienced tremendous success in its Willows subdivision near the
Potomac River in Maryland. The Company will continue to focus on geographic,
product and pricing niches.
PRODUCT LINES
The Company, on a regional basis, offers up to eight distinct product
lines, ranging in price from the low $80,000's to approximately $500,000 and
ranging in square footage from approximately 1,100 to 4,000 square feet.
Essentially, the difference among each of these products lines are the floor
plans, square footage and price and availability of specific features and
options. There are more than 200 different floor plans and elevations across all
product lines. By offering a wide range of homes, the Company is able to attract
first-time home buyers as well as move-up buyers.
9
10
The Company offers a selective number of its product lines in its divisions
outside of Columbus. However, in the Columbus market, which is the Company's
largest market, the Company offers all of its eight distinct product lines. The
price range and average square footage for these product lines are shown below:
PRODUCT LINE PRICE RANGE SQUARE FOOTAGE
-------------------- --------------------- --------------
Horizon $ 80,000 - $ 95,000 1,200
Heritage $ 85,000 - $110,000 1,400
Hallmark $110,000 - $145,000 2,000
Regency $145,000 - $185,000 2,450
Showcase Signature $165,000 - $185,000 2,500
Showcase Classic $180,000 - $210,000 2,600
Hampsted $190,000 - $310,000 2,600
Showcase Estates $210,000 and up 2,800
In addition, the Company offers a line of attached townhomes in the
Maryland and Virginia markets. These homes are marketed primarily to first-time
buyers and range from 1,400 to 2,200 square feet of living space. These homes
utilize wood frame construction and feature exteriors of aluminum with brick
fronts.
In all of the Company's lines of homes, certain options are available to
the purchaser for an additional charge. Major options include fireplaces,
additional bathrooms, and higher quality carpeting, cabinets and appliances. The
options typically are more numerous and significant on the more expensive homes.
In offering its various products, the Company attempts to maintain substantially
the same ratio of revenue to costs and expenses for each of its product lines.
LAND DEVELOPMENT ACTIVITIES
The Company's land development activities and land holdings have increased
significantly in the past few years and the Company expects land holdings to
remain at relatively high levels. However, the Company has always pursued and
continues to pursue a land acquisition policy that it believes is more
conservative than the policies of the other national home builders. The Company
develops its own lots where it can gain a competitive advantage by doing so or
where shortages of qualified land developers make it impractical to purchase the
required lots from outside sources. The Company seeks to limit its investment in
undeveloped land and lots to the amount reasonably expected to be sold in the
next three to four years. Although the Company purchases land and engages in
land development activities primarily for the purpose of furthering its own
home-building activities, in certain markets, the Company has developed land
with the intention of selling a portion of the lots to outside home builders.
To limit its risk in connection with such development, the Company has
primarily acquired land through the use of contingent purchase contracts. All
such contracts require the internal approval of the Company's Land Committee.
These contracts condition the Company's obligation to purchase land upon the
Company's review and approval of zoning, utilities, soil and subsurface
conditions, environmental and wetland conditions, levels of taxation, traffic
patterns, development costs, title matters and other property-related criteria.
In addition, careful attention is paid to the quality of the public school
system. Only after this thorough evaluation has been completed does the Company
make a commitment to purchase undeveloped land. To further reduce its risk in
undertaking land development, the Company generally does not commence technical
and engineering surveys or obtain subdivision and other required governmental
permits and development approvals until all necessary zoning approvals are
obtained.
To diversify its investment in land, the Company occasionally enters into
joint ventures, generally with other home builders. At December 31, 1995, the
Company had interests varying from 33% to 50% in each of 18 joint ventures,
three formed in 1995, three formed in 1994, four of which were formed in 1993,
and eight formed prior to 1993. These joint ventures develop land into lots and,
generally, the Company receives its percentage
10
11
interest in the joint venture in the form of a distribution of developed
lots. These joint ventures pay to the managing joint venture partner certain
fees for accounting, administrative and construction supervision services
performed by the managing partner in addition to its percentage interest as a
partner in the profits of the joint venture. The Company currently is
responsible for the management of seven of these 18 joint ventures. In most
instances, these joint ventures are entirely equity financed.
In developing lots and land, the Company is required by some municipalities
and other governmental authorities to provide completion bonds for sewer,
streets and other improvements. The Company generally provides letters of credit
in lieu of these completion bonds. At December 31, 1995, $9.8 million of letters
of credit were outstanding for these purposes, as well as $3.3 million of
completion bonds.
AVAILABLE LOTS AND LAND
The Company seeks to balance the economic risk of owning lots and land with
the necessity of having lots available for its homes. At December 31, 1995, the
Company had in inventory 2,137 developed lots and 649 lots under development.
The Company also owned raw land expected to be developed into approximately
1,438 lots.
In addition, at December 31, 1995, the Company's interest in lots held by
its joint ventures consisted of 4 developed lots and 263 lots under development.
The Company also owns interests in raw land held by its joint ventures zoned for
843 lots. It is anticipated that some of the lots owned by the Company and the
joint ventures will be sold to others, including land held through its joint
ventures.
At December 31, 1995, the Company had options and purchase contracts, which
expire over the next three years, to acquire approximately 5,769 lots, including
developed lots and land to be developed into lots, with an aggregate current
purchase price of approximately $145.8 million. Purchase of these properties is
contingent upon satisfaction of certain requirements by the Company and the
sellers, such as zoning approval. The majority of these lot purchase agreements
provide for periodic escalation of the purchase price which, the Company
believes, reflects the developers' carrying cost of the lots. The following
table sets forth the Company's land position in lots (including the Company's
interest in joint ventures) by region at December 31, 1995:
OWNED LOTS
-----------------------------------
Under To Be Lots to be
Region Developed Development Developed Purchased Total
-------------------------------------------------------------------------------------
Ohio and Indiana 933 585 1,428 2,812 5,758
Florida 929 - 258 831 2,018
Carolina 109 126 153 1,548 1,936
Washington, D.C. 170 201 442 578 1,391
------------------------------------------------------------------------------------
Total 2,141 912 2,281 5,769 11,103
====================================================================================
REGULATION AND ENVIRONMENTAL MATTERS
The home-building industry, including the Company, is subject to various
local, state and federal (including FHA and VA) statutes, ordinances, rules and
regulations concerning zoning, building, design, construction, sales and similar
matters. Such regulation affects construction activities, including types of
construction materials which may be used, certain aspects of building design, as
well as sales activities and other dealings with consumers. The Company also
must obtain certain licenses, permits and approvals from various governmental
authorities for its development activities. In many areas, the Company is
subject to local regulations which impose restrictive zoning and density
requirements in order to limit the number of houses within the
11
12
boundaries of a particular locality. The Company seeks to reduce the risk from
restrictive zoning and density requirements by the use of contingent land
purchase contracts which require that the land to be purchased by the Company
meet various requirements, including zoning.
The Company may be subject to periodic delays or may be precluded entirely
from developing projects due to building moratoriums, particularly in Florida.
Generally, such moratoriums relate to insufficient water or sewage facilities or
inadequate road capacity within specific market areas or subdivisions.
Moratoriums experienced by the Company have not been of long duration and have
not had a material effect on the Company's business.
Each of the states in which the Company operates has adopted a wide variety
of environmental protection laws. These laws generally regulate developments of
substantial size and which are in or near certain specified geographic areas.
Furthermore, these laws impose requirements for development approvals which are
more stringent than those which land developers would have to meet outside of
these geographic areas.
Increasingly stringent requirements may be imposed on home builders and
developers in the future which may have a significant impact on the Company and
the industry. Although the Company cannot predict the effect of these
requirements, such requirements could result in time-consuming and expensive
compliance programs. In addition, the continued effectiveness of licenses or
permits already granted or development approvals already obtained is dependent
upon many factors, some of which are beyond the Company's control.
EMPLOYEES
At December 31, 1995 the Company employed 712 people (including part-time
employees), of which were 196 employed in sales, 284 in construction and 232 in
management, administrative and clerical positions. The Company considers its
employee relations to be excellent. No employees are represented by a collective
bargaining agreement.
ITEM 2. PROPERTIES
The Company leases all of its offices, including the corporate and division
locations. The Company currently leases a portion of its office space from M/I
Office Development Company, an Ohio general partnership of which the Irving and
Frankie Schottenstein Trust and the Melvin L. Schottenstein Marital Trust are
partners. See "Item 13. Certain Relationships and Related Transactions."
Due to the nature of the Company's business, a substantial amount of
property is held as inventory in the ordinary course of business. See "Item 1.
Business - Available Lots and Land."
ITEM 3. LEGAL PROCEEDINGS
The Company is involved in routine litigation incidental to its business.
Management does not believe that any of this litigation is material to the
financial condition or the results of operations of the Company.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
During the fourth quarter of 1995, no matters were submitted
to a vote of security holders.
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PART II
ITEM 5. MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED SHAREHOLDER MATTERS
The information required by this item is incorporated herein by
reference from the Company's Annual Report to Shareholders for the year ended
December 31, 1995.
ITEM 6. SELECTED FINANCIAL DATA
The information required by this item is incorporated herein by
reference from the Company's Annual Report to Shareholders for the year ended
December 31, 1995.
ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF RESULTS OF OPERATIONS AND
FINANCIAL CONDITION
The information required by this item is incorporated herein by
reference from the Company's Annual Report to Shareholders for the year ended
December 31, 1995.
ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
The information required by this item is incorporated herein by
reference from the Company's Annual Report to Shareholders for the year ended
December 31, 1995.
ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
FINANCIAL DISCLOSURE
There have been no changes in or disagreements with accountants during
the two fiscal years ended December 31, 1995.
13
14
PART III
ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT
The information required by this item is incorporated herein by
reference to the Company's definitive proxy statement relating to the 1996
Annual Meeting of Shareholders.
ITEM 11. EXECUTIVE COMPENSATION
The information required by this item is incorporated herein by
reference to the Company's definitive proxy statement relating to the 1996
Annual Meeting of Shareholders.
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The information required by this item is incorporated herein by
reference to the Company's definitive proxy statement relating to the 1996
Annual Meeting of Shareholders.
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
The information required by this item is incorporated herein by
reference to the Company's definitive proxy statement relating to the 1996
Annual Meeting of Shareholders.
14
15
PART IV
ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON FORM 8-K
(a) 1. Financial Statements. The following financial statements of M/I
Schottenstein Homes, Inc. and subsidiary have been incorporated herein
by reference as set forth in Item 8 of Part II of this Annual Report on
Form 10-K:
Independent Auditors' Report
Consolidated Balance Sheets - December 31, 1995 and 1994
Consolidated Statements of Income - Years Ended December 31, 1995, 1994
and 1993
Consolidated Statements of Stockholders' Equity - Years Ended December
31, 1995, 1994 and 1993
Consolidated Statements of Cash Flows - Years Ended December 31, 1995,
1994 and 1993
Notes to Consolidated Financial Statements
2. Financial Statement Schedules.
All schedules have been omitted because the required information is
included in the financial statements or notes thereto, the amounts
involved are not significant, or the required matter is not present.
3. Exhibits.
The following exhibits required by Item 601 of Regulation S-K are filed
as part of this report. For convenience of reference the exhibits are
listed according to the numbers appearing in the Exhibit Table to Item
601 of Regulation S-K.
Exhibit Number Description
- -------------- -----------
3.1 Amended and Restated Articles of Incorporation of the
Company, hereby incorporated by reference to Exhibit 3.1 of
the Company's Annual Report on Form 10-K for the fiscal year
ended December 31, 1993.
3.2 Regulations of the Company, hereby incorporated by reference
to Exhibit 3(l) of the Company's Registration Statement on
Form S-1, Commission File No. 33-68564.
3.3 Amendment to the Code of Regulations of the Company, hereby
incorporated by reference to Exhibit 4.3 of the Company's
Registration Statement on Form S-8, Commission File No.
33-76518.
4 Specimen of Stock Certificate, hereby incorporated by
reference to Exhibit 4 of the Company's Registration
Statement on Form S-1, Commission File No. 33-68564.
15
16
Exhibit Number Description
- -------------- -----------
10.1 Indenture between M/I Schottenstein Homes, Inc., a Delaware
corporation (the "Predecessor") and Ameritrust Company
National Association, as Trustee, including form of
Subordinated Notes due December 1, 2001, hereby incorporated
by reference to Exhibit 4(b) of the Predecessor's
Registration Statement on Form S-4, Commission File No.
33-44914.
10.2 Supplemental Indenture between the Predecessor and
Ameritrust Company National Association, as Trustee, dated
April 22, 1992, including form of Exchange Notes due
December 1, 2001, hereby incorporated by reference to
Exhibit 4(a) of the Predecessor's Registration Statement on
Form S-4, Commission File No. 33-44914.
10.3 Supplemental Indenture between the Company and Society
National Bank, successor by merger to Ameritrust Company
National Association, as Trustee, dated November 8, 1993,
hereby incorporated by reference to Exhibit 10.3 of the
Company's Annual Report on Form 10-K for the fiscal year
ended December 31, 1993.
10.4 Exchange Agent Agreement between the Predecessor and
Ameritrust Company National Association dated February 12,
1992, hereby incorporated by reference to Exhibit 10(a) of
the Predecessor's Annual Report on Form 10-K for the fiscal
year ended December 31, 1991.
10.5 Executive Deferred Compensation Plan, hereby incorporated by
reference to Exhibit 10(e) of the Predecessor's Annual
Report on Form 10-K for the fiscal year ended December 31,
1989.
10.6 Amendments to the Predecessor's Executive Deferred
Compensation Plan dated March 29, 1991 and June 24, 1992,
hereby incorporated by reference to Exhibit 19(a) of the
Predecessor's Quarterly Report on Form 10-Q for the quarter
ended June 30, 1992.
10.7 The Predecessor's Amended and Restated 401(K) Profit Sharing
Plan, consisting of a Savings Plan Adoption Agreement,
Savings Plan and Savings Plan Trust, hereby incorporated by
reference to Exhibit 10(cc) of the Predecessor's Annual
Report on Form 10-K for the fiscal year ended December 31,
1991.
10.8 P.L. 1992 Limited Partnership Certificate and Agreement of
Limited Partnership dated March 25, 1992, hereby
incorporated by reference to Exhibit 10(vv) of the
Predecessor's Registration Statement on Form S-4, Commission
File No. 33-44914.
10.9 Promissory Note issued by P.L. 1992 Limited Partnership to
the Predecessor dated March 27, 1992, hereby incorporated by
reference to Exhibit 10(ww) of the Predecessor's
Registration Statement on Form S-4, Commission File No.
33-44914.
16
17
Exhibit Number Description
- -------------- -----------
10.10 Promissory Note issued by P.L. 1992 Limited Partnership to
the Company dated December 30, 1994, hereby incorporated by
reference to Exhibit 10.16 of the Company's Annual Report on
Form 10-K for the year ended December 31, 1994.
10.11 Master Lease Agreement between the Predecessor and M/I
Office Development Company dated August 7, 1992, hereby
incorporated by reference to Exhibit 19(c) of the
Predecessor's Quarterly Report on Form 10-Q for the quarter
ended June 30, 1992.
10.12 First Amendment to Master Lease Agreement between the
Predecessor and M/I Office Development Company dated
September 9, 1992, hereby incorporated by reference to
Exhibit 19(b) of the Predecessor's Quarterly Report on Form
10-Q for the quarter ended September 30, 1992.
10.13 Second Amendment to Master Lease Agreement between the
Predecessor and M/I Office Development Company dated October
30, 1992, hereby incorporated by reference to Exhibit 19(c)
of the Predecessor's Quarterly Report on Form 10-Q for the
quarter ended September 30, 1992.
10.14 Third Amendment to Master Lease Agreement between the
Predecessor and M/I Office Development Company dated March
4, 1996. (Filed herewith.)
10.15 Cascades 1992 Limited Partnership Certificate and Agreement
of Limited Partnership dated July 20, 1992, hereby
incorporated by reference to Exhibit 10(cc) of the
Predecessor's Annual Report on Form 10-K for the fiscal year
ended December 31, 1992.
10.16 Promissory Note issued by Cascades 1992 Limited Partnership
to the Predecessor dated October 16, 1992, hereby
incorporated by reference to Exhibit 10(dd) of the
Predecessor's Annual Report on Form 10-K for the fiscal year
ended December 31, 1992.
10.17 Promissory Note issued by Cascades 1992 Limited Partnership
to the Company dated December 30, 1994, hereby incorporated
by reference to Exhibit 10.22 of the Company's Annual Report
on Form 10-K for the year ended December 31, 1994.
10.18 Promissory Note issued by Cascades 1992 Limited Partnership
to the Company dated December 30, 1995. (Filed herewith.)
17
18
Exhibit Number Description
- -------------- -----------
10.19 Revolving Credit Loan, Seasonal Loan and Standby Letter of
Credit Agreement by and among the Company, Bank One,
Columbus, N.A.; The Huntington National Bank; NBD Bank,
N.A.; National City Bank, Columbus and Bank One, Columbus,
N.A., as agent for the banks, dated June 8, 1994, hereby
incorporated by reference to Exhibit 10(a) of the Company's
Quarterly Report on Form 10-Q for the quarter ended June 30,
1994.
10.20 Amendment No. 1 to Revolving Credit Loan, Seasonal Loan and
Standby Letter of Credit Agreement by and among the Company;
Bank One, Columbus, N.A.; The Huntington National Bank; NBD
Bank, N.A.; National City Bank, Columbus and Bank One,
Columbus, N.A., as agent for the banks, dated September 19,
1994, hereby incorporated by reference to Exhibit 10(a) of
the Company's Quarterly Report on Form 10-Q for the quarter
ended September 30, 1994.
10.21 Amendment No. 2 to Revolving Credit Loan, Seasonal Loan and
Standby Letter of Credit Agreement by and among the Company;
Bank One, Columbus, N.A.; The Huntington National Bank; NBD
Bank, N.A.; National City Bank, Columbus and Bank One,
Columbus, N.A., as agent for the banks, dated March 29,
1995, hereby incorporated by reference to Exhibit 10.46 of
the Company's Annual Report on Form 10-K for the year ended
December 31, 1994.
10.22 Revolving credit loan, seasonal loan and standby letter of
credit agreement by and among the Company, Bank One,
Columbus, N.A.; The Huntington National Bank; NBD Bank;
National City Bank, Columbus; The First National Bank of
Boston and Bank One, Columbus, N.A., as agent for the banks,
dated September 29, 1995, hereby incorporated by reference
to Exhibit 10.1 of the Company's quarterly report on Form
10-Q for the quarter ended September 30, 1995.
10.23 Promissory Note by and among the Company, M/I Financial
Corp. and Bank One, Columbus, N.A., dated November 5, 1993,
hereby incorporated by reference to Exhibit 19(d) of the
Company's Quarterly Report on Form 10-Q for the quarter
ended September 30, 1993.
10.24 Revolving Credit Agreement by and among the Company; M/I
Financial Corp. and Bank One, Columbus, N.A., dated August
10, 1994, hereby incorporated by reference to Exhibit 10(b)
of the Company's Quarterly Report on Form 10-Q for the
quarter ended June 30, 1994.
10.25 Revolving Credit Agreement by and among the Company; M/I
Financial Corp. and Bank One, Columbus, N.S. dated August 7,
1995, hereby incorporated by reference to Exhibit 10.1 of
the Company's Quarterly Report on Form 10-Q for the quarter
ended June 30, 1995.
18
19
Exhibit Number Description
- -------------- -----------
10.26 1993 Stock Incentive Plan of the Company, hereby
incorporated by reference to Exhibit 4.4 of the Company's
Registration Statement on Form S-8, Commission File No.
33-76518.
10.27 Melvin and Irving Schottenstein Family Agreement by and
among the Predecessor, the Company and its then shareholders
of record dated October 7, 1993, hereby incorporated by
reference to Exhibit 10(ww) of the Company's Registration
Statement on Form S-1, Commission File No. 33-68564.
10.28 Company's 1994 President and Chief Executive Officer Bonus
Program, hereby incorporated by reference to Exhibit 10.55
of the Company's Annual Report on Form 10-K for the fiscal
year ended December 31, 1993.
10.29 Company's 1994 Corporate Executive Vice President Bonus
Program, hereby incorporated by reference to Exhibit 10.56
of the Company's Annual Report on Form 10-K for the fiscal
year ended December 31, 1993.
10.30 Company's Amended 1994 Corporate Executive Vice President
Bonus Program, hereby incorporated by reference to Exhibit
10.60 of the Company's Annual Report on Form 10-K for the
year ended December 31, 1994.
10.31 Company's 1994 Senior Vice President and Chief Financial
Officer Bonus Program, hereby incorporated by reference to
Exhibit 10.57 of the Company's Annual Report on Form 10-K
for the fiscal year ended December 31, 1993.
10.32 Company's 1994 Senior Vice President and Treasurer Bonus
Program, hereby incorporated by reference to Exhibit 10.58
of the Company's Annual Report on Form 10-K for the fiscal
year ended December 31, 1993.
10.33 Company's 1994 Senior Vice President/General Counsel Bonus
Program, hereby incorporated by reference to Exhibit 19.1 of
the Company's Quarterly Report on Form 10-Q for the quarter
ended March 31, 1994.
10.34 Company's 1994 Senior Vice President/Regional Manager Bonus
Program, hereby incorporated by reference to Exhibit 10.59
of the Company's Annual Report on Form 10-K for the fiscal
year ended December 31, 1993.
10.35 Company's 1994 Division Manager Bonus Program, hereby
incorporated by reference to Exhibit 10.60 of the Company's
Annual Report on Form 10-K for the fiscal year ended
December 31, 1993.
19
20
Exhibit Number Description
- -------------- -----------
10.36 Consulting and Separation Agreement between the Company and
Eric J. Schottenstein, dated January 5, 1994, hereby
incorporated by reference to Exhibit 10.61 of the Company's
Annual Report on Form 10-K for the fiscal year ended
December 31, 1993.
10.37 Executive Employment Agreement by and between the Company
and Irving E. Schottenstein dated August 9, 1994, hereby
incorporated by reference to Exhibit 10(c) of the Company's
Quarterly Report on Form 10-Q for the quarter ended June 30,
1994.
10.38 Company's 1995 President and Chief Executive Officer Bonus
Program, hereby incorporated by reference to Exhibit 10.68
of the Company's Annual Report on Form 10-K for the year
ended December 31, 1994.
10.39 Company's 1995 Corporate Executive Vice President Bonus
Program, hereby incorporated by reference to Exhibit 10.1 of
the Company's Quarterly Report on Form 10-Q for the quarter
ended March 31, 1995.
10.40 Company's 1995 Senior Vice President and Chief Financial
Officer Bonus Program, hereby incorporated by reference to
Exhibit 10.2 of the Company's Quarterly Report on Form 10-Q
for the quarter ended March 31, 1995.
10.41 Company's 1995 Senior Vice President and General Counsel
Bonus Program, hereby incorporated by reference to Exhibit
10.3 of the Company's Quarterly Report on Form 10-Q for the
quarter ended March 31, 1995.
10.42 Company's 1995 Senior Vice President and Treasurer Bonus
Program, hereby incorporated by reference to Exhibit 10.4 of
the Company's Quarterly Report on Form 10-Q for the quarter
ended March 31, 1995.
10.43 Company's 1995 Senior Vice President/Regional Manager Bonus
Program, hereby incorporated by reference to Exhibit 10.69
of the Company's Annual Report on Form 10-K for the year
ended December 31, 1994.
10.44 Company's 1995 Division Manager Bonus Program, hereby
incorporated by reference to Exhibit 10.70 of the Company's
Annual Report on Form 10-K for the year ended December 31,
1994.
10.45 Company's 1996 President and Chief Executive Officer Bonus
Program. (Filed herewith.)
10.46 Company's 1996 Corporate Executive Vice President Bonus
Program. (Filed herewith.)
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21
Exhibit Number Description
- -------------- -----------
10.47 Company's 1996 Senior Vice President and Chief Financial
Officer Bonus Program. (Filed herewith.)
10.48 Company's 1996 Senior vice President and General Counsel
Bonus Program. (Filed herewith.)
10.49 Company's 1996 Senior Vice President and Treasurer Bonus
Program. (Filed herewith.)
10.50 Investment Home Compensation Plan dated September 1, 1995,
hereby incorporated by reference to Exhibit 10.2 of the
Company's Quarterly Report on Form 10-Q for the quarter
ended September 30, 1995.
10.51 Limited Liability Company Agreement of Northeast Office
Venture, Limited Liability Company dated November 17, 1995.
(Filed herewith.)
10.52 Lease Agreement by and between the Company and Northeast
Office Venture, Limited Liability Company dated November 17,
1995. (Filed herewith.)
13 Annual Report to Shareholders for the year ended December
31, 1995. (Filed herewith.)
21 Subsidiaries of Company, hereby incorporated by reference to
Exhibit 21 of the Company's Registration Statement of Form
S-1, Commission File No. 33-68564.
23 Consent of Deloitte & Touche LLP. (Filed herewith.)
24 Powers of Attorney. (Filed herewith.)
- ---------------
(b) Reports on Form 8-K
No reports on Form 8-K have been filed during the last quarter of the
period covered by this report.
(c) See Item 14(a)(3).
(d) Not applicable.
21
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SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange
Act of 1934, the registrant has duly caused this report to be signed on its
behalf by the undersigned, thereunto duly authorized, in Columbus, Ohio on this
29th day of March, 1996.
M/I SCHOTTENSTEIN HOMES, INC.
(Registrant)
By: /s/ IRVING E. SCHOTTENSTEIN
-------------------------------------
Irving E. Schottenstein
Chief Executive Officer and President
Pursuant to the requirements of the Securities Exchange Act of 1934, this report
has been signed below by the following persons on behalf of the registrant and
in the capacities indicated on this 29th of March, 1996.
NAME AND TITLE NAME AND TITLE
-------------- --------------
/s/ IRVING E. SCHOTTENSTEIN /s/ KERRII B. ANDERSON
- -------------------------------------------- ---------------------------------------------
Irving E. Schottenstein Kerrii B. Anderson
Chairman of the Board, President and Senior Vice President, Chief Financial
Chief Executive Officer Officer and Assistant Secretary
(Principal Executive Officer) (Principal Financial and Accounting Officer)
FRIEDRICH K. M. BOHM* JOHN B. GERLACH*
- -------------------------------------------- ---------------------------------------------
Friedrich K. M. Bohm John B. Gerlach
Director Director
HOLLY S. KASTAN* ERIC J. SCHOTTENSTEIN*
- -------------------------------------------- ---------------------------------------------
Holly S. Kastan Eric J. Schottenstein
Director Director
LENORE G. SCHOTTENSTEIN* ROBERT H. SCHOTTENSTEIN*
- -------------------------------------------- ---------------------------------------------
Lenore G. Schottenstein Robert H. Schottenstein
Director Director
STEVEN SCHOTTENSTEIN* LEWIS R. SMOOT, SR.*
- -------------------------------------------- ---------------------------------------------
Steven Schottenstein Lewis R. Smoot, Sr.
Director Director
* The above-named Directors of the Registrant execute this report by Irving E.
Schottenstein and Kerrii B. Anderson, their Attorneys-in-Fact, pursuant to
powers of attorney executed by the above-named Directors and filed with the
Securities and Exchange Commission as Exhibit 24 to the report.
By: /s/ IRVING E. SCHOTTENSTEIN
-----------------------------------------
Irving E. Schottenstein, Attorney-in-Fact
By: /s/ KERRII B. ANDERSON
-----------------------------------------
Kerrii B. Anderson, Attorney-in-Fact
22