June 8, 2010 (FinancialWire) — MHI Hospitality Corp. (NASDAQ: MDH) said it has entered into a fifth amendment to its credit agreement with Branch Banking & Trust Co. (NYSE: BBT), as administrative agent and lender, which was originally dated May 8, 2006. The amendment fixes interest rate spreads and makes the facility non-revolving, among other provisions.

The amendment fixes the interest rate spread for variable LIBOR-based interest rate loans at 4.00% and sets a LIBOR floor at 0.75%. It eliminates the company's ability to borrow any further funds under the facility or re-borrow previously repaid funds.

MHI said that the amendment also removes prior timing restrictions on the payment of cash dividends and distributions and maintains existing liquidity and other conditions to declare and pay cash dividends and distributions in excess of that amount minimally necessary to maintain the company's REIT qualification.

It provides an option to extend the maturity date of the credit agreement to May 8, 2012 if certain valuation and other criteria are met, among other things.

Virginia-based MHI Hospitality is a self-managed lodging REIT focused on the acquisition, renovation, upbranding and repositioning of full-service hotels in the Mid-Atlantic and Southern United States.

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