What changed in this filing

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Item 8. Financial Statements and Supplementary Data

2024-02-16 compared with 2023-02-17 · 143 added, 148 removed, 1009 unchanged (22% of the section changed)

26 unchanged sentences

Management assesses inventory for recoverability on a quarterly basis to determine if events or changes in local or national economic conditions indicate that the carrying amount of an asset may not be recoverable.

The inventory balance was $2.83 billion and $2.45 billion at December 31, 2022 and 2021, respectively.

In conducting the review for impairment indicators, management evaluates certain qualitative and quantitative factors at the community level.

25 unchanged sentences

Land and housing $ 3,014,573 $ 3,087,551 $ 2,836,972

Impairment of inventory and investment in joint venture arrangements 18,352 — 8,435

General and administrative 222,765 214,811 192,009

1 unchanged sentence

Other income ( 33 ) ( 6 ) ( 2,046 )

Interest 2,250 2,156 9,684

Interest (income) expense - net

( 20,022 ) 2,250 2,156

Loss on early extinguishment of debt — — 9,072

34 unchanged sentences

Notes payable bank - financial services operations 165,844 245,741

Notes payable - other — 4,549

Senior notes due 2028 - net 396,879 396,105

52 unchanged sentences

Year Ended December 31,

(Dollars in thousands) 2022 2021 2020

(In thousands)

2023 2022 2021

OPERATING ACTIVITIES:

9 unchanged sentences

Amortization of mortgage servicing rights 1,578 1,624 1,640

Loss (gain) on sale of mortgage servicing rights 318 ( 1,135 ) ( 33 )

(Gain) loss on sale of mortgage servicing rights

( 936 ) 318 ( 1,135 )

Depreciation 12,916 12,982 12,691

2 unchanged sentences

Stock-based compensation expense 11,370 8,787 8,559

Deferred income tax (benefit) expense ( 7,767 ) ( 4,068 ) 3,448

Deferred income tax expense (benefit)

2,705 ( 7,767 ) ( 4,068 )

Change in assets and liabilities:

19 unchanged sentences

(Net repayments of) net proceeds from bank borrowings - financial services operations

( 79,897 ) ( 20,419 ) 40,526

(Principal repayments of) proceeds from notes payable-other and community development

21 unchanged sentences

M/I Homes, Inc.

and its subsidiaries (the “Company” or “we”) is engaged primarily in the construction and sale of single-family residential homes in Columbus and Cincinnati, Ohio;

and its subsidiaries (the “Company,” “we,” “us” and “our”) is engaged primarily in the construction and sale of single-family residential homes in Columbus and Cincinnati, Ohio;

Indianapolis, Indiana;

5 unchanged sentences

Austin, Dallas/Fort Worth, Houston and San Antonio, Texas;

Charlotte and Raleigh, North Carolina and Nashville, Tennessee.

Charlotte and Raleigh, North Carolina;

and Nashville, Tennessee.

The Company designs, sells and builds single-family homes on developed lots, which it develops or purchases ready for home construction.

1 unchanged sentence

Our homebuilding operations operate across two geographic regions in the United States.

Within these regions, our operations have similar economic characteristics;

therefore, they have been aggregated into two reportable homebuilding segments:

Within these regions, our operations have similar economic characteristics and, therefore, they have been aggregated into two reportable homebuilding segments:

Southern homebuilding and Northern homebuilding.

2 unchanged sentences

The Company and M/I Financial also operate 100%-owned subsidiaries that provide title services to purchasers of the Company’s homes.

Our mortgage banking and title service activities have similar economic characteristics;

therefore, they have been aggregated into one reportable segment, the financial services segment.

Our mortgage banking and title service activities have similar economic characteristics and, therefore, they have been aggregated into one reportable segment, the financial services segment.

Basis of Presentation.

3 unchanged sentences

The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the period.

Actual results could differ from these estimates and have a significant impact on the financial condition and results of operations and cash flows.

Actual results could differ from these estimates and have a significant impact on our financial condition, results of operations and cash flows.

Reclassifications.

Certain amounts in our Consolidated Financial Statements for year ended December 31, 2022 were adjusted to conform to our 2023 presentation.

The Company believes these reclassifications are immaterial.

Cash, Cash Equivalents and Restricted Cash.

Cash and cash equivalents are liquid investments with an initial maturity of three months or less.

Amounts in transit from title companies for homes delivered are included in this balance at December 31, 2022 and 2021, respectively.

Cash and cash equivalents are liquid investments, such as U.S.

government securities, commercial bank deposits, and money market funds, with an initial maturity of three months or less.

Amounts in transit from title companies for homes delivered are included in this balance at December 31, 2023 and 2022.

Restricted cash consists of cash held in escrow.

2 unchanged sentences

Mortgage loans held for sale consists primarily of single-family residential loans collateralized by the underlying property.

Generally, all of the mortgage loans and related servicing rights are sold to third-party investors shortly after origination.

Generally, all of the mortgage loans originated by M/I Financial and related servicing rights are sold to third-party investors shortly after origination.

Refer to the Revenue Recognition policy described below for additional discussion.

5 unchanged sentences

Costs of home deliveries include the specific construction cost of the home and the allocated lot costs.

Such costs are charged to cost of sales simultaneously with revenue recognition, as discussed above.

Such costs are charged to cost of sales simultaneously with revenue recognition.

When a home is closed, we typically have not yet paid all incurred costs necessary to complete the home.

1 unchanged sentence

We record a liability and a corresponding charge to cost of sales for the amount we estimate will ultimately be paid related to that home.

We monitor the accuracy of such estimates by comparing actual costs incurred in subsequent months to the estimate, although actual costs to complete a home in the future could differ from our estimates.

We monitor the

accuracy of such estimates by comparing actual costs incurred in subsequent months to the estimate, although actual costs to complete a home in the future could differ from our estimates.

Inventory is recorded at cost, unless events and circumstances indicate that the carrying value of the inventory is impaired, at which point the inventory is written down to fair value as required by the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 360-10, Property, Plant and Equipment (“ASC 360”).

The Company assesses

inventory for recoverability on a quarterly basis to determine if events or changes in local or national economic conditions indicate that the carrying amount of an asset may not be recoverable.

The Company assesses inventory for recoverability on a quarterly basis to determine if events or changes in local or national economic conditions indicate that the carrying amount of an asset may not be recoverable.

In conducting our quarterly review for indicators of impairment on a community level, we evaluate, among other things, the margins on sales contracts in backlog, the margins on homes that have been delivered, expected changes in margins with regard to future home sales over the life of the community, expected changes in margins with regard to future land sales, the value of the land itself as well as any results from third party appraisals.

11 unchanged sentences

For example, construction in progress inventory, which is closer to completion, will generally require a lower discount rate than land under development in communities consisting of multiple phases spanning several years of development.

During the fourth quarter of 2022, we recorded an aggregate loss of $ 18.4 million that included $ 10.2 million of write-offs of land deposits for land we no longer intend to purchase in order to right-size our land portfolio and $ 8.2 million of asset impairment charges.

Our quarterly assessments reflect management’s best estimates.

8 unchanged sentences

Office furnishings, leasehold improvements, computer equipment and computer software $ 39,650 $ 38,489

Transportation and construction equipment 20,735 20,540 (a)

Transportation and construction equipment 20,729 20,735

Property and equipment 60,379 59,224

3 unchanged sentences

Office furnishings, leasehold improvements, computer equipment and computer software 3-7 years

Transportation and construction equipment (a)

(a) During the fourth quarter of 2021, the Company sold its airplane and purchased another airplane for a net change in asset value of $ 10.5 million.

The asset is included in the table above within Transportation and construction equipment and within Property and Equipment - Net on our Consolidated Balance Sheet.

Depreciation is computed using the straight-line method over the respective estimated useful lives of the parts of the airplane.

Maintenance and repair expenditures are charged to selling, general and administrative expense as incurred.

The sale of the airplane was with an unrelated party and resulted in a gain of $ 1.9 million that is included in Other income on the Company’s Consolidated Statement of Operations.

Transportation and construction equipment

Depreciation expense was $ 8.2 million, $ 8.4 million and $ 7.5 million in 2023, 2022 and 2021, respectively.

33 unchanged sentences

While the structural warranty reserve is recorded as each house is delivered, the sufficiency of the structural warranty per unit charge and total reserve is re-evaluated on an annual basis, with the assistance of an actuary, using our own historical data and trends, industry-wide historical data and trends, and other project specific factors.

The reserves are also evaluated quarterly and adjusted if we encounter activity that is inconsistent with the historical experience used in the annual analysis.

The reserves are also evaluated quarterly and adjusted if we

encounter activity that is inconsistent with the historical experience used in the annual analysis.

These reserves are subject to variability due to uncertainties regarding structural defect claims for products we build, the markets in which we build, claim settlement history, insurance and legal interpretations, among other factors.

2 unchanged sentences

At December 31, 2023 and 2022, warranty reserves of $ 32.0 million and $ 32.9 million, respectively, are included in Other Liabilities on the Consolidated Balance Sheets.

See Note 8 to our Consolidated Financial Statements for additional information related to our warranty reserves, including reserves related to stucco-related repairs in certain of our Florida communities.

See Note 8 to our Consolidated Financial Statements for additional information related to our warranty reserves.

Self-insurance Reserves.

30 unchanged sentences

Our performance obligation, to deliver the agreed-upon home, is generally satisfied in less than one year from the original contract date.

Deferred revenue resulting from uncompleted performance obligations existing at the time we deliver new homes to our homebuyers is not material.

Deferred revenue

resulting from uncompleted performance obligations existing at the time we deliver new homes to our homebuyers is not material.

Although our third-party land sale contracts may include multiple performance obligations, the revenue we expect to recognize in any future year related to remaining performance obligations, excluding revenue pertaining to contracts that have an original expected duration of one year or less, is not material.

8 unchanged sentences

Year Ended December 31,

(Dollars in thousands) 2022 2021 2020

(In thousands)

2023 2022 2021

Housing $ 3,914,372 $ 4,010,427 $ 3,630,469

3 unchanged sentences

Total revenue $ 4,033,502 $ 4,131,393 $ 3,745,887

(a) Revenues include hedging gains of $ 49.4 million for the year ended December 31, 2022, hedging gains of $ 1.6 million for the year ended December 31, 2021, and hedging losses of $ 19.0 million for the year ended December 31, 2020.

Hedging gains (losses) do not represent revenues recognized from contracts with customers.

(a) Revenues include hedging gains of $ 11.9 million, $ 49.4 million, and $ 1.6 million for the years ended December 31, 2023, 2022 and 2021, respectively.

Hedging gains do not represent revenues recognized from contracts with customers.

Refer to Note 15 for presentation of our revenues disaggregated by geography.

20 unchanged sentences

In determining the future tax consequences of events that have been recognized in the consolidated financial statements or tax returns, judgment is required.

This assessment gives appropriate consideration to all positive and negative

evidence related to the realization of the deferred tax assets and considers, among other matters, the nature, frequency and severity of current and cumulative losses, forecasts of future profitability, the length of statutory carryforward periods, our experience with operating losses and our experience of utilizing tax credit carryforwards and tax planning alternatives.

This assessment gives appropriate consideration to all positive and negative evidence related to the realization of the deferred tax assets and considers, among other matters, the nature, frequency and severity of current and cumulative losses, forecasts of future profitability, the length of statutory carryforward periods, our experience with operating losses and our experience of utilizing tax credit carryforwards and tax planning alternatives.

See Note 14 to our Consolidated Financial Statements for more information regarding our deferred tax assets.

6 unchanged sentences

Recently Adopted Accounting Standards.

In March 2020, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No.

2020-04, Facilitation of the Effects of Reference Rate Reform on Financial Reporting (“ASU 2020-04”).

ASU 2020-04 is intended to provide temporary optional expedients and exceptions to the US GAAP guidance on contract modifications and hedge accounting to ease the financial reporting burdens related to the expected market transition from the London Interbank Offered Rate (LIBOR) and other interbank offered rates to alternative reference rates.

This guidance became effective on March 12, 2020 and can be applied prospectively through December 31, 2022.

In January 2021, the FASB issued ASU No.

2021-01, Reference Rate Reform (Topic 848):

Scope (“ASU 2021-01”), which clarified the scope and application of the original guidance.

We fully adopted ASU 2020-04 and ASU 2021-01 in October 2022 after we amended our $90 million mortgage repurchase agreement, dated October 30, 2017, as amended (the “MIF Mortgage Repurchase Facility”), which discontinued the use of LIBOR and replaced it with One-Month Term SOFR.

The adoption of this guidance did not have a material impact on our consolidated financial statements and disclosures.

In October 2023, FASB issued Accounting Standards Update (“ASU”) No.

2023-06, Disclosure Improvements:

Codification Amendments in Response to the SEC’s Disclosure Update and Simplification Initiative issued in August 2018 (“ASU 2023-06”).

ASU 2023-06 amends GAAP to reflect updates and simplifications to certain disclosure requirements referred to the FASB by the SEC.

The targeted amendments incorporate 14 of the 27 disclosures referred by the SEC into codification.

Some of the amendments represent clarifications to, or technical corrections of, the current requirements.

ASU 2023-06 could move certain disclosures from the nonfinancial portions of SEC filings to the financial statement notes.

Each amendment in ASU 2023-06 will only become effective if the SEC removes the related disclosure or presentation requirement from its existing regulations by June 30, 2027.

No amendments were effective at December 31, 2023.

The Company is currently evaluating the impact the adoption of ASU 2023-06 may have on our consolidated financial statements and disclosures, but we do not expect the impact to be significant.

In November 2023, the FASB issued ASU No.

2023-07, Segment Reporting (Topic 280):

Improvements to Reportable Segment Disclosures (“ASU 2023-07”).

ASU 2023-07 requires disclosure of significant segment expenses that are regularly provided to the chief operating decision maker (“CODM”) and included within each reported measure of segment profit or loss, an amount and description of its composition for other segment items to reconcile to segment profit or loss, and the title and position of the entity’s CODM.

The amendments in this update also expand the interim segment disclosure requirements.

ASU 2023-07 will be applied retrospectively and is effective for annual reporting periods in fiscal years beginning after December 15, 2023, and interim reporting periods in fiscal years beginning after December 31, 2024.

The Company is currently evaluating the impact the adoption of ASU 2023-07 may have on our consolidated financial statements and disclosures, but we do not expect the impact to be significant.

In December 2023, the FASB issued ASU No.

2023-09, Income Taxes (Topic 740):

Improvements to Income Tax Disclosures (“ASU 2023-09”).

ASU 2023-09 requires public companies to annually (1) disclose specific categories in the rate reconciliation and (2) provide additional information for reconciling items that meet a quantitative threshold (if the effect of those reconciling items is equal to or greater than five percent of the amount computed by multiplying pretax income or loss by the applicable statutory income tax rate).

ASU 2023-09 will be effective for the annual reporting periods in fiscal years beginning after December 15, 2024.

The Company is currently evaluating the impact the adoption of ASU 2023-09 may have on our consolidated financial statements and disclosures, but we do not expect the impact to be significant.

Stock-Based and Deferred Compensation

6 unchanged sentences

Under the 2018 LTIP, the Company is permitted to grant (1) nonqualified stock options to purchase common shares, (2) incentive stock options to purchase common shares, (3) stock appreciation rights, (4) restricted common shares, (5) other stock-based awards (awards that are valued in whole or in part by reference to, or otherwise based on, the fair market value of our common shares), and (6) cash-based awards to its officers, employees, non-employee directors and other eligible participants.

Subject to certain adjustments, the 2018 LTIP authorizes awards to officers, employees, non-employee directors and other eligible participants for up to 4,243,947 common shares, of which 2,005,352 remain available for grant at December 31, 2022.

Subject to certain adjustments, the 2018 LTIP authorizes awards to officers, employees, non-employee directors and other eligible participants for up to 4,217,436 common shares, of which 1,150,922 remained available for grant at December 31, 2023.

The 2018 LTIP replaced the M/I Homes, Inc.

4 unchanged sentences

The grant date fair value for stock option awards is estimated using the Black-Scholes option pricing model.

Options awarded generally vest 20% annually over five years and expire after ten years.

Options awarded vest 20% annually over five years and expire after ten years.

We recognize stock-based compensation expense for our stock option awards over the requisite service period of the award.

9 unchanged sentences

Exercised ( 944,135 ) 35.79

Forfeited ( 48,500 ) 51.40

Options outstanding at December 31, 2023

22 unchanged sentences

As of December 31, 2023, there was a total of $ 17.5 million of unrecognized compensation expense related to unvested stock option awards that will be recognized as stock-based compensation expense as the awards vest over a weighted average period of 2.2 years for the service awards.

Director Restricted Stock Units and Stock Units

In 2022, the Company awarded each non-employee director 4,571 restricted stock units (with the exception of a newly elected board member who was awarded 3,198 restricted stock units in August 2022), for a total of 35,195 restricted stock units, under the 2018 LTIP which will vest on the first anniversary of the date of grant (subject to the non-employee director’s continued service on the Board of Directors on the vesting date (except in the case of death or disability)) and will be settled in common shares (on a one-for-one basis) upon the director’s termination of service as a director.

The Company awarded its non-employee directors a total of 20,370 and 24,000 stock units under the 2018 LTIP during the years ended December 31, 2021 and 2020, respectively.

Each stock unit is the equivalent of one common share, vests immediately and will be converted into a common share upon termination of service as a director.

The grant date fair value for the director restricted stock units and the director stock units is based upon the closing price of our common shares on the date of grant.

Director Restricted Stock Units

In 2023, the Company awarded each non-employee director 2,894 restricted stock units, for a total of 20,258 restricted stock units, under the 2018 LTIP which will vest on the first anniversary of the date of grant (subject to the non-employee director’s continued service on the Board of Directors on the vesting date (except in the case of death or disability)) and will be settled in common shares upon the director’s termination of service as a director.

The Company awarded its non-employee directors a total of 35,195 and 20,370 restricted stock units under the 2018 LTIP during the years ended December 31, 2022 and 2021, respectively.

The grant date fair value for the director restricted stock units is based upon the closing price of our common shares on the date of grant.

Stock-based compensation expense for our director restricted stock units is recognized over the period of the award (amortized over one year).

Stock-based compensation expense for our director stock units, which vest immediately, is fully

recognized on the day the award is granted.

The Company recognized the stock-based compensation expense related to the awards of $ 1.4 million in 2022, $ 0.9 million in 2021 and $ 0.7 million in 2020.

The Company recognized stock-based compensation expense related to the awards of $ 1.5 million in 2023, $ 1.4 million in 2022 and $ 0.9 million in 2021.

Director Stock Units

On May 5, 2009, the Company’s Board of Directors terminated the M/I Homes, Inc.

2 unchanged sentences

At December 31, 2023, there were 8,059 stock units outstanding under the Director Equity Plan with a value of $ 0.2 million.

Each stock unit is the equivalent of one common share, vests immediately and will be converted into a common share upon termination of service as a director.

The grant date fair value for the director stock units is based upon the closing price of our common shares on the date of grant.

Stock-based compensation expense for our director stock units is recognized at the date of grant.

Performance Share Unit Awards

11 unchanged sentences

There was a total of $ 0.2 million of unrecognized stock-based compensation expense related to the Market Condition portion of the 2023 and 2022 PSU awards as of December 31, 2023.

At December 31, 2022, the Market Condition for the 2020 PSU awards was not met;

therefore, no PSU’s vested during the first quarter of 2023 with respect to the portion of the 2020 PSU’s subject to the Market Condition.

At December 31, 2023, the Market Condition for the 2021 PSU awards was met.

Based on these results and board approval, 9,262 PSU’s vested during the first quarter of 2024 with respect to the portion of the 2021 PSU’s subject to the Market Condition.

For the portion of the PSU’s subject to a Performance Condition, we recognize stock-based compensation expense on a straight-line basis over the Performance Period based on the probable outcome of the related Performance Condition.

If satisfaction of the performance condition is not probable, stock-based compensation expense recognition is deferred until probability is attained and a cumulative compensation expense adjustment is recorded and recognized ratably over the remaining service period.

If satisfaction of the Performance Condition is not probable, stock-based compensation expense recognition is deferred until probability is attained and a cumulative compensation expense adjustment is recorded and recognized ratably over the

remaining service period.

The Company reassesses the probability of the satisfaction of the Performance Condition on a quarterly basis, and stock-based compensation expense is adjusted based on the portion of the requisite service period that has passed.

If actual results differ significantly from these estimates, stock-based compensation expense could be higher and have a material impact on our consolidated financial statements.

As of December 31, 2022, the Company had not recognized any stock-based compensation expense related to the Performance Condition portion of the 2022 PSU awards.

If the Company achieves the minimum performance levels for the Performance Condition to be met for the 2022 PSU awards, the Company would record unrecognized stock-based compensation expense of $ 0.6 million as of December 31, 2022, for which $ 0.2 million would be immediately recognized as if attainment had been probable at December 31, 2022.

The Company recognized $ 1.3 million of stock-based compensation expense related to the Performance Condition portion of the 2021 PSU awards during 2022 based on the probability of attaining the Performance Condition.

The Company has $ 0.6 million of unrecognized stock-based compensation expense related to the Performance Condition portion of the 2021 PSU awards at December 31, 2022.

The Company recognized $ 0.7 million of stock-based compensation expense related to the Performance Condition portion of the 2020 PSU awards as of December 31, 2022 based on

the achievement of the maximum performance level.

The Company recognized $ 0.2 million and $ 0.9 million of stock-based compensation expense related to the Performance Condition portion of the 2023 and 2022 PSU awards, respectively, during 2023 based on the probability of attaining the Performance Conditions.

The Company has $ 0.4 million of unrecognized stock-based compensation expense related to the Performance Condition portion of each of the 2023 and 2022 PSU awards at December 31, 2023.

The Company recognized $ 0.6 million of stock-based compensation expense related to the Performance Condition portion of the 2021 PSU awards as of December 31, 2023 based on the achievement of the maximum performance level.

Based on these results and board approval, 37,050 PSU’s vested during the first quarter of 2024 with respect to the portion of the 2021 PSU awards subject to the Performance Condition.

25 unchanged sentences

These FMBSs, options on FMBSs, and IRLCs covered by FMBSs are considered non-designated derivatives.

These amounts are either recorded in Other Assets or Other Liabilities on the Consolidated Balance Sheets (depending on the respective balance for that year ended December 31).

These amounts

are either recorded in Other Assets or Other Liabilities on the Consolidated Balance Sheets (depending on the respective balance for that year ended December 31).

The Company measures both mortgage loans held for sale and IRLCs at fair value.

3 unchanged sentences

Market risk arises if interest rates move adversely between the time of the “lock-in” of rates by the borrower and the sale date of the loan to an investor.

To mitigate the effect of the interest rate risk inherent in providing rate lock commitments to borrowers, the Company enters into optional or mandatory delivery forward

sale contracts to sell whole loans and mortgage-backed securities to broker/dealers.

To mitigate the effect of the interest rate risk inherent in providing rate lock commitments to borrowers, the Company enters into optional or mandatory delivery forward sale contracts to sell whole loans and mortgage-backed securities to broker/dealers.

The forward sale contracts lock in an interest rate and price for the sale of loans similar to the specific rate lock commitments.

29 unchanged sentences

Description of Financial Instrument (in thousands) 2023 2022

Whole loan contracts and related committed IRLCs $ — $ 782

Uncommitted IRLCs $ 174,274 $ 262,529

10 unchanged sentences

Whole loan contracts 43 ( 323 ) 353

Total (loss) gain recognized $ ( 6,116 ) $ 1,741 $ ( 382 )

Total gain (loss) recognized

$ 5,396 $ ( 6,116 ) $ 1,741

The following tables set forth the fair value of the Company’s derivative instruments and their location within the Consolidated Balance Sheets for the periods indicated (except for mortgage loans held for sale which are disclosed as a separate line item):

45 unchanged sentences

Interest rate lock commitments Level 2 3,617 3,617 787 787

Forward sales of mortgage-backed securities Level 2 — — 4,477 4,477

Notes payable - homebuilding operations Level 2 — — — —

Notes payable - financial services operations Level 2 165,844 165,844 245,741 245,741

Notes payable - other Level 2 — — 4,549 5,015

Senior notes due 2028 (a)

2 unchanged sentences

Level 2 300,000 267,375 300,000 240,750

Interest rate lock commitments Level 2 — — 487 487

Whole loan contracts for committed IRLCs and mortgage loans held for sale Level 2 335 335 377 377

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Notes Payable - Financial Services Operations.

M/I Financial is a party to two credit agreements:

(1) a $ 200 million secured mortgage warehousing agreement (which increased to $ 275 million from September 19, 2022 to November 13, 2022 and to $ 300 million from November 14, 2022 to February 6, 2023, which are periods of increased volume of mortgage originations), dated May 27, 2022 , as amended (the “MIF Mortgage Warehousing Agreement”);

and (2) a $ 90 million mortgage repurchase agreement, dated October 30, 2017 , as amended (the “MIF Mortgage Repurchase Facility”).

For each of these credit facilities, the interest rate is based on a variable rate index, and thus their carrying value is a reasonable estimate of fair value.

The interest rate available to M/I Financial during 2022 fluctuated with SOFR or BSBY, as applicable.

See Note 11 to our Consolidated Financial Statements for additional information regarding the MIF Mortgage Warehousing Agreement and the MIF Mortgage Repurchase Facility.

Notes Payable - Other.

The estimated fair value was determined by calculating the present value of the future cash flows using the Company’s current incremental borrowing rate.

M/I Financial is a party to a $ 300 million mortgage repurchase agreement, dated October 24, 2023 (the “MIF Mortgage Repurchase Facility”).

For this credit facility, the interest rate is based on a variable rate index, and thus its carrying value is a reasonable estimate of fair value.

The interest rate available to M/I Financial fluctuated with SOFR.

See Note 11 to our Consolidated Financial Statements for additional information regarding the MIF Mortgage Repurchase Facility.

Inventory and Capitalized Interest

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See Notes 1 and 3 to our Consolidated Financial Statements for additional details relating to our procedures for evaluating our inventories for impairment.

During the fourth quarter of 2022, we incurred $ 8.2 million of asset impairment charges.

Land purchase deposits include both refundable and non-refundable amounts paid to third party sellers relating to the purchase of land.

1 unchanged sentence

The Company expenses any deposits and accumulated pre-acquisition costs relating to such agreements in the period when the Company makes the decision not to proceed with the purchase of land under an agreement.

During the fourth quarter of 2022, we wrote off $ 10.2 million of such costs related to land we no longer intend to purchase.

Capitalized Interest

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Under the equity method, our share of the LLCs’ earnings or loss, if any, is included in our Consolidated Statements of Income.

The Company’s equity in income relating to earnings from its LLCs was less than $ 0.1 million for the year ended December 31, 2022, $ 0.1 million for the year ended December 31, 2021 and $ 0.5 million for the year ended December 31, 2020.

The Company’s equity in income relating to earnings from its LLCs was less than $0.1 million for both the years ended December 31, 2023 and 2022, and $0.1 million for the year ended December 31, 2021.

Our share of the profit relating to lots we purchase from our LLCs is deferred until homes are delivered by us and title passes to a homebuyer.

We believe that the Company’s maximum exposure related to its investment in these joint venture arrangements as of December 31, 2022 was the amount invested of $ 51.6 million, which is reported as Investment in Joint Venture Arrangements on our Consolidated Balance Sheets.

We believe that the Company’s maximum exposure related to its investment in these joint venture arrangements as of December 31, 2023 was the amount invested of $ 44.0 million, which is reported as Investment in Joint Venture Arrangements

on our Consolidated Balance Sheets.

We expect to invest further amounts in these joint venture arrangements as development of the properties progresses.

8 unchanged sentences

(2) the financial condition and near-term prospects of the joint venture arrangement;

and (3) the intent and ability of the Company to retain its investment in the joint venture arrangements for a period of time sufficient to allow for any

anticipated recovery in market value.

and (3) the intent and ability of the Company to retain its investment in the joint venture arrangements for a period of time sufficient to allow for any anticipated recovery in market value.

Due to uncertainties in the estimation process and the significant volatility in demand for new housing, actual results could differ significantly from such estimates.

1 unchanged sentence

With respect to our investments in these LLCs, we are required, under ASC 810-10, Consolidation (“ASC 810”), to evaluate whether or not such entities should be consolidated into our Consolidated Financial Statements.

We initially perform these evaluations when each new entity is created and upon any events that require reconsideration of the entity.

We perform these evaluations when each new entity is created and upon any events that require reconsideration of the entity.

In order to determine if we should consolidate an LLC, we determine (1) if the LLC is a variable interest entity (“VIE”) and (2) if we are the primary beneficiary of the entity.

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Actual future costs associated with these guarantees and indemnities could differ materially from our current estimated amounts.

At December 31, 2022 and 2021, guarantees and indemnities of $ 1.4 million and $ 2.5 million, respectively, are included in Other Liabilities on the Consolidated Balance Sheets.

At December 31, 2023 and 2022, guarantees and indemnities of $ 2.4 million and $ 1.4 million, respectively, were included in Other Liabilities on the Consolidated Balance Sheets.

Commitments and Contingencies

6 unchanged sentences

Changes in estimates for pre-existing warranties 2,457 5,374 2,382

Charges related to stucco-related claims — — 860 (a)

Settlements made during the period ( 24,904 ) ( 24,136 ) ( 22,543 )

Warranty reserves, end of period $ 31,980 $ 32,902 $ 29,728

(a) This represents charges of $ 1.6 million for additional stucco-related repair costs, net of $ 0.7 million of recoveries for past stucco-related claims, during 2020.

Performance Bonds and Letters of Credit

The Company provides standby letters of credit and completion bonds for development work in progress, deposits on land and lot purchase agreements and miscellaneous deposits.

At December 31, 2022, the Company had outstanding approximately $ 432.9 million of completion bonds and standby letters of credit, some of which were issued to various local governmental entities that expire at various times through November, 2027.

At December 31, 2023, the Company had outstanding approximately $ 391.7 million of completion bonds and standby letters of credit, some of which were issued to various local governmental entities that expire at various times through September 2028.

Included in this total are:

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The development agreements under which we are required to provide completion bonds or letters of credit are generally not subject to a required completion date and only require that the improvements are in place in phases as houses are built and sold.

In locations where development has progressed, the amount of development work remaining to be completed is typically less than the remaining amount of bonds or letters of credit due to timing delays in obtaining release of the bonds or letters of credit.

Land Option Agreements

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Pursuant to these land option agreements, the Company provides a deposit to the seller as consideration for the right to purchase land at different times in the future, usually at predetermined prices.

In accordance with ASC 810, we analyze our land option or purchase agreements to determine whether the corresponding land sellers are VIEs and, if so, whether we are the primary beneficiary, using an analysis similar to that described above.

Although we do not have legal title to the optioned land, ASC 810 requires a company to consolidate a VIE if the company is determined to be the primary beneficiary.

In cases where we are the primary beneficiary, even though we do not have title to such land, we are required to consolidate these purchase/option agreements and reflect such assets and liabilities in our Consolidated Inventory Not Owned in our Consolidated Balance Sheets.

At both December 31, 2022 and 2021, we have concluded that we were not the primary beneficiary of any VIEs from which we are purchasing land under option or purchase agreements.

At both December 31, 2023 and 2022, we concluded that we were not the primary beneficiary of any VIEs from which we are purchasing land under option or purchase agreements.

In addition, we evaluate our land option or purchase agreements to determine for each contract if (1) a portion or all of the purchase price is a specific performance requirement, or (2) the amount of deposits and prepaid acquisition and development costs exceed certain thresholds relative to the remaining purchase price of the lots.

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Other than as described below in “Consolidated Inventory Not Owned and Related Obligation,” the Company currently believes that its maximum exposure as of December 31, 2023 related to our land option agreements is equal to the amount of the Company’s outstanding deposits and prepaid acquisition costs, which totaled $ 73.7 million, including cash deposits of $ 51.6 million, prepaid acquisition costs of $ 8.5 million, letters of credit of $ 10.3 million and $ 3.3 million of other non-cash deposits.

At December 31, 2022, the Company also had options and contingent purchase agreements to acquire land and developed lots with an aggregate purchase price of approximately $ 803.5 million.

At December 31, 2023, the Company also had options and contingent purchase agreements to acquire land and developed lots with an aggregate purchase price of approximately $ 1.09 billion.

Purchase of properties under these agreements is contingent upon satisfaction of certain requirements by the Company and the sellers.

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Legal Matters

In addition to the legal proceedings related to stucco, the Company and certain of its subsidiaries have been named as defendants in certain other legal proceedings which are incidental to our business.

The Company and certain of its subsidiaries have been named as defendants in certain other legal proceedings which are incidental to our business.

While management currently believes that the ultimate resolution of these other legal proceedings, individually and in the aggregate, will not have a material effect on the Company’s financial position, results of operations and cash flows, such legal proceedings are subject to inherent uncertainties.

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However, the possibility exists that the costs to resolve these legal proceedings could differ from the recorded estimates and, therefore, have a material effect on the Company’s net income for the periods in which they are resolved.

At both December 31, 2022 and 2021, we had $ 1.2 million reserved for legal expenses.

At December 31, 2023 and 2022, we had $ 1.0 million and $ 1.2 million reserved for legal expenses, respectively.

Operating Leases

The Company leases certain office space and model homes under operating leases with remaining terms of one to 19 years.

The Company leases certain office space and model homes under operating leases with remaining terms of less than one year to 17 years.

The Company sells model homes to investors with the express purpose of leasing the homes back as sales models for a specified period of time.

Under ASC 842, the Company records the sale of the model home and the profit on the sale at the time of the home delivery.

Under ASC 842, Leases ("ASC 842"), the Company records the sale of the model home and the profit on the sale at the time of the home delivery.

The Company determines if an arrangement is a lease at inception when the arrangement transfers the right to control the use of an identified asset to the Company.

ROU assets represent the right to use an underlying asset for the lease term and lease liabilities represent the obligation to make payments arising from the lease agreement.

Right of Use (“ROU”) assets represent the right to use an underlying asset for the lease term and lease liabilities represent the obligation to make payments arising from the lease agreement.

The Company has operating leases but does not have any material financing leases.

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As the rate implicit in our leases is not readily determinable, the Company uses its estimated incremental borrowing rate at the commencement date in determining the present value of the lease payments.

We give consideration to our recent debt issuances as well as to the current rate available under our Credit Facility when calculating our incremental borrowing rate.

We give consideration to our debt issuances as well as to the current rate available under our Credit Facility when calculating our incremental borrowing rate.

Our lease agreements do not contain any residual value guarantees or material restrictive covenants.

During the twelve months ended December 31, 2022, the Company’s operating ROU asset and operating lease liability increased by $ 9.5 million and $ 9.8 million, respectively, as a result of $ 17.0 million in additional leases and modifications to existing leases throughout the period (which is recorded within its Consolidated Statement of Cash Flows in the change in Other Assets and Other Liabilities), offset partially by $ 7.6 million of additional ROU asset amortization and $ 7.2 million of additional periodic lease expense.

As of December 31, 2022, the Company’s ROU asset was $ 60.4 million and its operating

lease liability had a balance of $ 61.3 million on its Consolidated Balance Sheets.

During the twelve months ended December 31, 2023, the Company’s operating ROU asset and operating lease liability decreased by $ 4.1 million and $ 3.7 million, respectively, as a result of $ 9.2 million of additional ROU asset amortization and $ 8.9 million of additional periodic lease expense, offset partially by $ 5.2 million in additional leases and modifications to existing leases throughout the period (which is recorded within its Consolidated Statement of Cash Flows in the change in Other Assets and Other Liabilities).

As of December 31, 2023, the Company’s ROU asset was $ 56.4 million, and its operating lease liability had a balance of $ 57.6 million on its Consolidated Balance Sheets.

The weighted-average remaining lease term was 10.4 years, and the weighted-average discount rate was 4.1 %.

For the twelve months ended December 31, 2023, the Company had the following operating lease expense components:

(Dollars in thousands)

(In thousands)

Operating lease expense $ 11,134

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The following table presents a maturity analysis of our annual undiscounted cash flows reconciled to the carrying value of our operating lease liabilities as of December 31, 2023:

(Dollars in thousands)

(In thousands)

2024 $ 10,864

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6/1/2022 5/1/2053 5.40 % 3,365 3,365

6/1/2022 5/1/2053 5.40 % 3,365 —

Total CDD bond obligations issued and outstanding $ 45,600 $ 45,600

The Company records a liability for the estimated developer obligations that are probable and estimable and user fees that are required to be paid or transferred at the time the parcel or unit is sold to an end user.

The Company reduces this liability by the corresponding Assessment assumed by property purchasers and the amounts paid by the Company at the time of closing and the

transfer of the property.

The Company reduces this liability by the corresponding Assessment assumed by property purchasers and the amounts paid by the Company at the time of closing and the transfer of the property.

The Company recorded a $ 19.3 million and $ 29.7 million liability related to these CDD bond obligations as of December 31, 2023 and December 31, 2022, respectively, along with the related inventory infrastructure.

Notes Payable - Homebuilding

On December 9, 2022, the Company entered into an amendment to the Credit Facility which, among other things (1) increased the commitments from lenders to $ 650 million from $ 550 million, (2) extended the maturity to December 9, 2026 , (3) increased the accordion feature pursuant to which the maximum borrowing availability may be increased to an aggregate of $ 800 million, subject to obtaining additional commitments from lenders, (4) increased the sub-facility for letters of credit included in the Credit Facility to $ 250 million from $ 150 million, and (5) replaced LIBOR with SOFR as an interest rate bench mark (subject to a floor of 0.25 %) and permitted the Company to select an index rate for each borrowing from multiple interest rate options, including one, three or six month adjusted term SOFR, plus a margin of 175 basis points (subject to adjustment in subsequent quarterly periods based on the Company’s then applicable leverage ratio).

The Credit Facility provides for an aggregate commitment amount of $ 650 million and also includes an accordion feature pursuant to which the maximum borrowing availability may be increased to an aggregate of $ 800 million, subject to obtaining additional commitments from lenders.

The Credit Facility matures on December 9, 2026 .

Interest on amounts borrowed under the Credit Facility is payable at multiple interest rate options including one, three or six month adjusted term SOFR (subject to a floor of 0.25 %) plus a margin of 175 basis points (subject to adjustment in subsequent quarterly periods based on the Company’s leverage ratio).

The Credit Facility also contains certain financial covenants.

At December 31, 2023, the Company was in compliance with all financial covenants of the Credit Facility.

The available amount under the Credit Facility is computed in accordance with a borrowing base, which is calculated by applying various advance rates for different categories of inventory, and totaled $ 2.0 billion of availability for additional senior debt at December 31, 2023.

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Notes Payable - Financial Services

The MIF Mortgage Warehousing Agreement is used to finance eligible residential mortgage loans originated by M/I Financial.

The MIF Mortgage Warehousing Agreement provides for a maximum borrowing availability of $ 200 million, which increased to $ 275 million from September 19, 2022 to November 13, 2022 and increased to $ 300 million from November 14, 2022 to February 6, 2023 (periods of increases in the volume of mortgage originations).

The MIF Mortgage Warehousing Agreement expires on May 26, 2023 .

Interest on amounts borrowed under the MIF Mortgage Warehousing Agreement is payable at a per annum rate equal to the one-month BSBY rate (adjusting daily) (subject to a floor of 0.25 %) plus a spread of 190 basis points.

The MIF Mortgage Warehousing Agreement also contains certain financial covenants.

At December 31, 2022, M/I Financial was in compliance with all financial covenants of the MIF Mortgage Warehousing Agreement.

The MIF Mortgage Warehousing Agreement was used to finance eligible residential mortgage loans originated by M/I Financial.

On October 24, 2023 , M/I Financial entered into an amendment to its MIF Mortgage Warehousing Agreement which reduced its borrowing availability to $ 110 million through November 10, 2023.

The borrowing availability under the MIF Mortgage Warehouse Agreement increased to $ 120 million on November 11, 2023.

On December 6, 2023, the Company terminated the MIF Mortgage Warehousing Agreement.

M/I Financial entered into a mortgage repurchase agreement on October 24, 2023 (the “MIF Mortgage Repurchase Facility”), which provides for a maximum borrowing availability of $ 300 million (subject to increases and decreases during certain periods) and expires on October 22, 2024 .

The borrowing availability under the MIF Mortgage Repurchase Facility is $ 300 million from November 11, 2023 through February 9, 2024, will decrease to $ 240 million from February 10, 2024 through September 17, 2024 and will increase to $ 270 million from September 18, 2024 until maturity.

The MIF Mortgage Repurchase Facility is used to finance eligible residential mortgage loans originated by M/I Financial.

The MIF Mortgage Repurchase Facility provides for a mortgage repurchase facility with a maximum borrowing availability of

$ 90 million.

The MIF Mortgage Repurchase Facility expires on October 23, 2023 .

M/I Financial pays interest on each advance under the MIF Mortgage Repurchase Facility at a per annum rate equal to One-Month Term SOFR (subject to an all-in floor of 2.375 % or 2.75 % based on the type of loan) and adjusts certain financial covenant limits, plus 150 or 200 basis points depending on the loan type.

The MIF Mortgage Repurchase Facility also contains certain financial covenants.

At December 31, 2022, M/I Financial was in compliance with all financial covenants of the MIF Mortgage Repurchase Facility.

At December 31, 2022 and 2021, M/I Financial’s total combined maximum borrowing availability under the two credit facilities were $ 390.0 million and $ 325.0 million, respectively.

At December 31, 2022 and December 31, 2021, M/I Financial had $ 245.7 million and $ 266.2 million outstanding on a combined basis under its credit facilities, respectively.

M/I Financial pays interest on each advance under the MIF Mortgage Repurchase Facility at a per annum rate based on Daily Adjusting One-Month Term SOFR plus a margin as defined in the repurchase agreement.

The MIF Mortgage Repurchase Facility also contains certain financial covenants each of which is defined in the repurchase agreement.

At December 31, 2023 and 2022, M/I Financial’s total combined maximum borrowing availability under its credit facilities was $ 300.0 million and $ 390.0 million, respectively.

At December 31, 2023 and 2022, M/I Financial had $ 165.8 million and $ 245.7 million, respectively, in borrowings outstanding on a combined basis under its then-outstanding credit facilities.

As of both December 31, 2023 and 2022, we had $ 300.0 million of our 2030 Senior Notes outstanding.

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The indenture governing the 2028 Senior Notes limits our ability to pay dividends on, and repurchase, our common shares and any of our preferred shares then outstanding to the amount of the positive balance in our “restricted payments basket,” as defined in the indenture.

contributions to the common equity of the Company after December 1, 2015 or the sale of qualified equity interests after December 1, 2015, plus other items and subject to other exceptions.

The “restricted payments basket” is equal to $ 125.0 million plus (1) 50 % of our aggregate consolidated net income (or minus 100 % of our aggregate consolidated net loss) from October 1, 2015, excluding income or loss from Unrestricted Subsidiaries (as defined in the indenture), plus (2) 100 % of the net cash proceeds from either contributions to the common equity of the Company after December 1, 2015 or the sale of qualified equity interests after December 1, 2015, plus other items and subject to other exceptions.

The positive balance in our restricted payments basket was $ 813.7 million and $ 661.7 million at December 31, 2023 and 2022, respectively.

The determination to pay future dividends on, or make future repurchases of, our common shares will be at the discretion of our Board of Directors and will depend upon our results of operations, financial condition, capital requirements and compliance with debt covenants, and other factors deemed relevant by our Board of Directors.

Notes Payable - Other

The Company had other borrowings, which are reported in Notes Payable - Other in our Consolidated Balance Sheets, totaling $ 4.5 million as of December 31, 2021, which are comprised of notes payable acquired in the normal course of business.

There were no other borrowings in Notes Payable - Other as of December 31, 2022.

Maturities over the next five years with respect to the Company’s debt as of December 31, 2023 are as follows:

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Goodwill represents the excess of the purchase price paid over the fair value of the net assets acquired and liabilities assumed in business combinations.

In connection with the Company’s acquisition of the homebuilding assets and operations of Pinnacle Homes in Detroit, Michigan in March of 2018, the Company recorded goodwill of $ 16.4 million, which is included as Goodwill in our Consolidated Balance Sheets.

In connection with the Company’s acquisition of the homebuilding assets and operations of Pinnacle Homes in Detroit, Michigan in March 2018, the Company recorded goodwill of $ 16.4 million, which is included as Goodwill in our Consolidated Balance Sheets.

This amount was based on the estimated fair values of the acquired assets and liabilities at the date of the acquisition in accordance with ASC 350.

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If the reporting unit’s carrying value exceeds its fair value, then an impairment loss is recognized for the amount of the excess of the carrying amount over the reporting unit’s fair value.

The Company performed its annual goodwill impairment analysis via a quantitative test during the fourth quarter of 2022, and there was no impairment recorded at December 31, 2022.

There were no indicators of impairment or impairment charges recorded at December 31, 2021.

The Company performed its annual goodwill impairment analysis via a quantitative test during both the fourth quarters of 2023 and 2022, and there was no impairment recorded at either December 31, 2023 or December 31, 2022.

The evaluation of goodwill for possible impairment includes estimating fair value using one or a combination of valuation techniques, such as discounted cash flows.

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Northern homebuilding $ 176,320 $ 217,499 $ 211,958

Southern homebuilding (b)

Southern homebuilding

440,168 451,874 312,661

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Corporate selling, general and administrative expense ( 77,980 ) ( 76,304 ) ( 68,614 )

Total operating income (a) (b) (c)

Total operating income (a)

$ 587,222 $ 637,451 $ 518,296

Interest expense (income):

Interest (income) expense - net:

Northern homebuilding $ ( 186 ) $ ( 469 ) $ 76

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Corporate ( 28,493 ) ( 956 ) ( 1,368 )

Total interest expense $ 2,250 $ 2,156 $ 9,684

Other income (d)

Total interest (income) expense - net

$ ( 20,022 ) $ 2,250 $ 2,156

Loss on early extinguishment of debt (e)

Other income (b)

$ ( 33 ) $ ( 6 ) $ ( 2,046 )

Loss on early extinguishment of debt (c)

Income before income taxes $ 607,277 $ 635,207 $ 509,114

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(a) Our financial services operational results should be viewed in connection with our homebuilding business as its operations originate loans and provide title services primarily for our homebuying customers, with the exception of an immaterial amount of mortgage refinancing.

(b) Includes a $ 0.9 million net charge for stucco-related repair costs in certain of our Florida communities (as more fully discussed in Note 8 to our Consolidated Financial Statements) taken during 2020.

(c) For the years ended December 31, 2022 and 2020, total operating income was reduced by $ 18.4 million and $ 8.4 million, respectively, related to asset impairment charges taken during the period.

(d) Other income is comprised of the gain on the sale of a non-operating asset during the fourth quarter of 2021 as well as equity in income from joint venture arrangements.

(e) Loss on early extinguishment of debt relates to the early redemption of our 5.625% senior notes due 2025 (the “2025 Senior Notes”) during the third quarter of 2021, consisting of a prepayment premium due to early redemption and a write-off of unamortized debt issuance costs.

(b) Other income is comprised of the gain on the sale of a non-operating asset during the fourth quarter of 2021 as well as equity in income from joint venture arrangements.

(c) Loss on early extinguishment of debt relates to the early redemption of our 5.625% senior notes due 2025 (the “2025 Senior Notes”) during the third quarter of 2021, consisting of a prepayment premium due to early redemption and a write-off of unamortized debt issuance costs .

The following tables show total assets by segment at December 31, 2023 and 2022:

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Share Repurchase Program

On July 28, 2021, the Company announced that its Board of Directors authorized the 2021 Share Repurchase Program pursuant to which the Company may purchase up to $100 million of its outstanding common shares through open market transactions, privately negotiated transactions or otherwise in accordance with all applicable laws.

On July 28, 2021, the Company announced that its Board of Directors approved a new share repurchase program pursuant to which the Company may purchase up to $ 100 million of its outstanding common shares (the “2021 Share Repurchase Program”).

On February 17, 2022, the Company announced that its Board of Directors approved an increase to its 2021 Share Repurchase Program by an additional $ 100 million.

During the year ended December 31, 2022, the Company repurchased 1.2 million outstanding common shares at an aggregate purchase price of $ 55.3 million under the 2021 Share Repurchase Program.

The Company did not repurchase any shares during the fourth quarter of 2022.

On November 15, 2023, the Company announced that its Board of Directors approved an increase to its 2021 Share Repurchase Program by an additional $ 100 million.

Pursuant to the 2021 Share Repurchase Program, the Company may purchase up to $ 300 million of its outstanding common shares through open market transactions, privately negotiated transactions or otherwise in accordance with all applicable laws.

The timing, amount and other terms and conditions of any additional repurchases under the 2021 Share Repurchase Program will be based on a variety of factors, including the market price of the Company’s common shares, business considerations, general market and economic conditions and legal requirements.

The 2021 Share Repurchase Program does not have an expiration date and the Board may modify, discontinue or suspend it at any time.

During the year ended December 31, 2023, the Company repurchased 0.7 million outstanding common shares at an aggregate purchase price of $ 65.3 million under the 2021 Share Repurchase Program.

As of December 31, 2023, $ 127.8 million remained available for repurchases under the 2021 Share Repurchase Program.

The timing, amount and other terms and conditions of any additional repurchases under the 2021 Share Repurchase Program will be determined by the Company’s management at its discretion based on a variety of factors, including the market price of the Company’s common shares, corporate considerations, general market and economic conditions and legal requirements.

The 2021 Share Repurchase Program does not have an expiration date and the Board may modify, discontinue or suspend it at any time.

CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 8. Financial Statements and Supplementary Data