15 .	Lines of Credit and Total Debt Obligations

Revolving Credit Facility.

We have an unsecured revolving credit agreement (“Revolving Credit Facility”) with a group of lenders which

may

be used for general corporate purposes.

This agreement has an

aggregate commitment of

$550

million (the “Commitment”)

and was amended on

December

18,

2015

to extend the maturity to

December

18,

2020.

Each lender

may

issue letters of credit in an amount up to

50%

of its commitment. The facility permits an increase in the maximum Commitment amount to

$1.0

billion upon our request, subject to receipt of additional commitments from existing or additional lenders and the consent of the designated agent and the co-administrative agent. As defined in the Revolving Credit Facility agreement, interest rates on outstanding borrowings are equal to the highest of

(1)

0.0%

(2)

a specified eurocurrency rate, federal funds effective rate or prime rate, plus a margin that is determined based on our credit ratings and leverage ratio. At any time at which our leverage ratio, as of the last day of the most recent calendar quarter, exceeds

55%,

the aggregate principal amount of all consolidated senior debt borrowings outstanding

may

not exceed the borrowing base. There is no borrowing base requirement if our leverage ratio, as of the last day of the most recent calendar quarter, is

55%

or less.

The Revolving Credit Facility is fully and unconditionally guaranteed, jointly and severally, by most of our homebuilding segment subsidiaries. The facility contains various representations, warranties and covenants that we believe are customary for agreements of this type. The financial covenants include a consolidated tangible net worth test and a leverage test, along with a consolidated tangible net worth covenant, all as defined in the facility agreement. A failure to satisfy the foregoing tests does not constitute an event of default, but can trigger a “term-out” of the facility. A breach of the consolidated tangible net worth covenant (but not the consolidated tangible net worth test) or a violation of anti-corruption or sanctions laws would result in an event of default.

The Revolving Credit Facility is subject to acceleration upon certain specified events of default, including breach of the consolidated tangible net worth covenant, a violation of anti-corruption or sanctions laws, failure to make timely payments, breaches of certain representations or covenants, failure to pay other material indebtedness, or another person becoming beneficial owner of

50%

or more of our outstanding common stock. We believe we were in compliance with the representations, warranties and covenants included in the Revolving Credit Facility as of

December

31,

2016.

We incur costs associated with unused commitment fees pursuant to the terms of the Revolving Credit Facility. At

December

31,

2016

and

2015,

there were

$23.0

million

and

$22.5

million, respectively, in letters of credit outstanding, which reduced the amounts available to be borrowed under the Revolving Credit Facility. We had

$15.0

million outstanding under the Revolving Credit Facility as of

December

31,

2016

and

2015.

As of

December

31,

2016,

availability under the Revolving Credit Facility was approximately

$512.0

million.

Mortgage Repurchase Facility.

HomeAmerican

entered into an Amended and Restated Master Repurchase Agreement (the “Mortgage Repurchase Facility”) with U.S. Bank National Association

(“USBNA”), effective

September

16,

2016

The Mortgage Repurchase Facility amends and restates the prior Master Repurchase Agreement with USBNA dated as of

November

12,

2008,

as amended, which contained similar terms. The Mortgage Repurchase Facility increases the facility amount from

$50

million to

$75

million, extends the expiration date to

September

15,

2017,

adjusts the facility’s sublimits, expands the types of eligible loans, and reduces the facility fee.

The Mortgage Repurchase Facility provides liquidity to HomeAmerican by providing for the sale of eligible mortgage loans to USBNA with an agreement by HomeAmerican to repurchase the mortgage loans at a future date. Until such mortgage loans are transferred back to HomeAmerican, the documents relating to such loans are held by USBNA, as custodian, pursuant to the Custody Agreement (“Custody Agreement”), dated as of

November

12,

2008,

by and between HomeAmerican and USBNA. In the event that an eligible mortgage loan becomes ineligible, as defined under the Mortgage Repurchase Facility, HomeAmerican

may

be required to repurchase the ineligible mortgage loan immediately. The maximum aggregate commitment of the Mortgage Repurchase Facility was temporarily increased on

December

27,

2016

from

$75

million to

$125

million and was effective through

January

25,

2017.

The Mortgage Repurchase Facility also had a temporary increase in the maximum aggregate commitment from

$50

million to

$90

million from

December

23,

2015

through

January

31,

2016.

December

31,

2016

and

December

31,

2015,

HomeAmerican had

$114.5

million and

$88.6

million, respectively, of mortgage loans that HomeAmerican was obligated to repurchase under the Mortgage Repurchase Facility. Mortgage loans that HomeAmerican is obligated to repurchase under the Mortgage Repurchase Facility are accounted for as a debt financing arrangement and are reported as mortgage repurchase facility in the consolidated balance sheets. Advances under the Mortgage Repurchase Facility carry a price range that is LIBOR-based. The Mortgage Repurchase Facility contains various representations, warranties and affirmative and negative covenants that we believe are customary for agreements of this type. The negative covenants include, among others, (i) a minimum Adjusted Tangible Net Worth requirement, (ii) a maximum Adjusted Tangible Net Worth ratio, (iii) a minimum adjusted net income requirement, and (iv) a minimum Liquidity requirement. The foregoing capitalized terms are defined in the Mortgage Repurchase Facility. We believe HomeAmerican was in compliance with the representations, warranties and covenants included in the Mortgage Repurchase Facility as of

December

31,

2016.

Senior Notes.

Our senior notes are not secured and, while the senior note indentures contain some restrictions on secured debt and other transactions, they do not contain financial covenants. Our senior notes are fully and unconditionally guaranteed on an unsecured basis, jointly and severally, by most of our homebuilding segment subsidiaries. We believe that we are in compliance with the representations, warranties and covenants in the senior note indentures.

January

15,

2014,

we issued

$250

million of

5½%

Senior Notes due

2024

(the

“5½%

Notes”). The

5½%

Notes, which pay interest semi-annually in arrears on

January

and

July

of each year, with payments commencing

July

15,

2014,

are general unsecured obligations of MDC and rank equally and ratably with our other general unsecured and unsubordinated indebtedness. We received proceeds of

$248.4

million, net of underwriting fees of

$1.6

million.

During the

2014

first

quarter, we redeemed our

5⅜%

Senior Notes due

December

2014

and, in the

2014

fourth

quarter, we redeemed our

5⅜%

Senior Notes due

July

2015.

As a result of these transactions, we paid

$517.7

million to extinguish

$500

million in debt principal and recorded a total of

$18.2

million in losses on early extinguishments of debt.

Our debt obligations at

December

31,

2016

and

2015,

net of any unamortized debt issuance costs or discount, were as follows:

	December 31,
	2016		2015
	(Dollars in thousands)
$250 Million 5⅝% Senior Notes due February 2020, net	$	246,915	$	246,032
$250 Million 5½% Senior Notes due January 2024, net		248,391		248,209
$350 Million 6% Senior Notes due January 2043, net		346,340		346,283
Total	$	841,646	$	840,524