Exhibit 10.1
INTERCREDITOR AGREEMENT
          This INTERCREDITOR AGREEMENT, dated as of December 3, 2008, and
entered into by and among HOVNANIAN ENTERPRISES, INC., K. HOVNANIAN ENTERPRISES,
each other Grantor (as defined below) from time to time party hereto, PNC Bank,
National Association, as administrative agent (as of the date hereof includes
the role of collateral agent) under the Senior Lender Documents (in such
capacity(ies), together with any successor or assigns, the “First-Lien
Administrative Agent” or “Senior Credit Agent”), Wilmington Trust Company, in
its capacity as collateral agent under the Senior Noteholder Collateral
Documents (as defined below) (together with its successor and assigns, the
“Senior Noteholder Collateral Agent”), the Senior Trustee (as defined below),
the Initial Junior Trustee (as defined below), Wilmington Trust Company, in its
capacity as collateral agent for the Junior Mortgage Tax Collateral (as defined
below) (together with its successors and assigns, the “Mortgage Tax Collateral
Agent”), Wilmington Trust Company, in its capacity as collateral agent with
respect to the Initial Junior Notes under the Junior Noteholder Collateral
Documents (as defined below) (together with its successors and assigns, the
“Initial Junior Noteholder Collateral Agent”) and each Additional Junior Trustee
(as defined below) and Additional Junior Noteholder Collateral Agent (as defined
below) from time to time party hereto.
RECITALS
          WHEREAS, the Company (as defined below), Hovnanian (as defined below),
certain lenders, and PNC Bank, National Association, as administrative agent,
are parties to that certain Credit Agreement (as defined below);
          WHEREAS, the Obligations (as defined below) of the Company under the
Credit Joinder Agreement are or will be secured by various assets of the
Company, Hovnanian and certain of their Subsidiaries and by various assets of
certain Subsidiaries formed or acquired in the future;
          WHEREAS, the Company, Hovnanian and certain of their Subsidiaries and
the Senior Trustee have entered into the Indenture dated as of May 27, 2008 (as
amended, supplemented or otherwise modified from time to time, the “Senior
Indenture”), pursuant to which the Senior Notes are governed and the Obligations
under which are or will be secured by various assets of the Grantors;
          WHEREAS, the Company, Hovnanian and certain of their Subsidiaries and
the Initial Junior Trustee have entered into the Indenture dated as of
December 3, 2008 (as amended, supplemented or otherwise modified from time to
time, the “Initial Junior Indenture”), pursuant to which $29,299,000 aggregate
principal amount of Senior Third-Lien Secured Notes (the “Initial Junior Notes”)
shall be (and any Additional Junior Notes may be) governed and the Obligations
under which shall be secured by various assets of the Grantors;
          WHEREAS, the Company, Hovnanian and certain of their Subsidiaries and
one or more Additional Junior Trustees may from time to time enter into one or
more Indentures (each, as amended, supplemented or otherwise modified from time
to time, an “Additional Junior

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Indenture” and, together with the Initial Junior Indenture, the “Junior
Indentures”), pursuant to which Additional Junior Notes (as defined below) shall
be governed and the Obligations under which shall be secured by various assets
of the Grantors; and
          WHEREAS, the parties hereto desire to order the priorities of their
respective Liens (as defined below) on the assets of the Grantors and address
other related matters set forth below.
          NOW, THEREFORE, in consideration of the foregoing, the mutual
covenants and obligations herein set forth and for other good and valuable
consideration, the sufficiency and receipt of which are hereby acknowledged, the
parties hereto, intending to be legally bound, hereby agree as follows:
          Section 1. (a) Definitions. As used in this Agreement, the definitions
set forth above are incorporated herein and the following terms have the
meanings specified below:
          “Additional Junior Indenture” has the meaning set forth in the
recitals.
          “Additional Junior Noteholder Collateral Agent(s)” means one or more
Collateral Agents (which may be the Initial Junior Noteholder Collateral Agent),
and its permitted successors and assigns, appointed by the Company with respect
to Additional Junior Notes and which has executed a Joinder Agreement
substantially in the form of Exhibit A hereto.
          “Additional Junior Notes” means any and all Senior Third-Lien Secured
Notes to be issued by the Company from time to time (other than the Initial
Junior Notes) pursuant to the Initial Junior Indenture or one or more Additional
Junior Indentures.
          “Additional Junior Trustee(s)” means one or more Trustees (which may
be the Initial Junior Trustee) under any Additional Junior Indentures, and its
permitted successors and assigns, appointed by the Company and which has
executed a Joinder Agreement substantially in the form of Exhibit A hereto.
          “Additional Mortgaged Collateral” has the meaning set forth in the
Credit Agreement.
          “Agreement” means this Intercreditor Agreement, as amended, renewed,
extended, supplemented or otherwise modified from time to time in accordance
with the terms hereof.
          “Bankruptcy Code” means Title 11 of the United States Code.
          “Bankruptcy Law” means the Bankruptcy Code and any similar Federal,
state or foreign law for the relief of debtors.
          “Business Day” means any day other than a Saturday, a Sunday or a day
that is a legal holiday under the laws of the State of New York or on which
banking institutions in the State of New York or the Commonwealth of
Pennsylvania are required or authorized by law or other governmental action to
close.

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          “Collateral Agency Agreement” means the Amended and Restated
Collateral Agency Agreement dated as of December 3, 2008 among Hovnanian, the
Company, the First-Lien Administrative Agent, the Mortgage Tax Collateral Agent.
the Senior Noteholder Collateral Agent and the Initial Junior Noteholder
Collateral Agent.
          “Common Collateral” means all of the assets of any Grantor, whether
real, personal or mixed, constituting Senior Lender Collateral, Senior
Noteholder Collateral and Junior Noteholder Collateral.
          “Company” means K. Hovnanian Enterprises, Inc., a corporation
organized and existing under the laws of the State of California and
wholly-owned by Hovnanian.
          “Comparable Junior Noteholder Collateral Document” means, in relation
to any Common Collateral subject to any Lien created under any Senior Collateral
Document or any Senior Noteholder Collateral Document, that Junior Noteholder
Collateral Document that creates a Lien on the same Common Collateral, granted
by the same Grantor.
          “Credit Agreement” means that Seventh Amended and Restated Credit
Agreement, dated as of March 7, 2008, and amended pursuant to Amendment No. 1 to
Seventh Amended and Restated Credit Agreement, dated as of May 16, 2008, among
Hovnanian, the Company, PNC Bank, National Association, as administrative agent,
and a syndicate of lenders, as may be amended, restated, supplemented, renewed,
modified, refunded, replaced, revised, restructured or refinanced in whole or in
part from time to time, provided that the stated principal amount thereof shall
not be increased beyond the limit set forth in the Indenture (as in effect on
the date hereof) and if at any time a Discharge of Senior Lender Claims occurs
with respect to the Credit Agreement, then, the term “Credit Agreement” shall
mean the Future First-Lien Indebtedness designated by the Company.
          “Deposit Account” has the meaning set forth in the Uniform Commercial
Code.
          “Deposit Account Collateral” means that part of the Common Collateral
comprised of Deposit Accounts, Financial Assets and Investment Property.
          “DIP Financing” has the meaning set forth in Section 6.1.
          “Discharge of Senior Claims” means payment in full in cash of (a) all
Obligations in respect of all outstanding First-Lien Indebtedness or, with
respect to letters of credit outstanding thereunder, delivery of cash collateral
in an amount equal to one hundred five Percent (105%) of the outstanding letters
of credit, as applicable, and termination of all commitments to extend credit
thereunder, (b) all Obligations in respect of all outstanding Senior Notes and
(c) any other Senior Claims that are due and payable or otherwise accrued and
owing at or prior to the time such principal and interest are paid, excluding,
in any case, Unasserted Contingent Obligations.
          “Discharge of Senior Lender Claims” means indefeasible payment in full
in cash of (a) all Obligations in respect of all outstanding First-Lien
Indebtedness or, with respect to letters of credit outstanding thereunder,
delivery of cash collateral in an amount equal to one hundred five Percent
(105%) of the outstanding letters of credit, as applicable, and termination of

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all commitments to extend credit thereunder and (b) any other Senior Lender
Claims that are due and payable or otherwise accrued and owing at or prior to
the time such principal and interest are paid, excluding, in any case,
Unasserted Contingent Obligations.
          “Financial Assets” has the meaning set forth in the Uniform Commercial
Code.
          “First-Lien Administrative Agent” has the meaning set forth in the
recitals.
          “First-Lien Indebtedness” means Indebtedness incurred pursuant to the
Credit Agreement, and all renewals, extensions, refundings, restructurings,
replacements and refinancings thereof, in an aggregate principal amount not to
exceed $300,000,000 plus up to an additional $25,000,000 of Indebtedness and
other Obligations permitted pursuant to clause (i)(b)(ii) of the definition of
Permitted Liens in the Initial Junior Indenture (and comparable clause under any
Additional Junior Indenture) as of the date hereof, plus interest, advances
reasonably necessary to preserve the value of the Common Collateral or to
protect the Common Collateral, costs and fees, including legal fees, to the
extent authorized under the Senior Collateral Documents or UCC § 9-607(d).
          “Future First-Lien Indebtedness” means any First-Lien Indebtedness
other than Indebtedness that is incurred pursuant to the Credit Agreement that
is designated by the Company as Future First-Lien Indebtedness and as a “Credit
Facility” under the Junior Indentures and which is permitted to be secured by a
first lien on the Common Collateral for purposes of the Junior Indentures or any
other Junior Noteholder Document.
          “Grantors” means the Company, Hovnanian and each of its Subsidiaries
that has or will have executed and delivered a Junior Noteholder Collateral
Document, a Senior Noteholder Collateral Document or a Senior Collateral
Document.
          “Hedging Obligations” means, with respect to any Person, all
obligations and liabilities of such Person in respect of (a) interest rate or
currency swap agreements, interest rate or currency cap agreements, interest
rate or currency collar agreements or (b) other agreements or arrangements
designed to protect such Person against fluctuations in interest rates and/or
currency exchange rates.
          “Hovnanian” means Hovnanian Enterprises, Inc., a Delaware corporation.
          “Indebtedness” means and includes all obligations that constitute
“Indebtedness” within the definition of “Indebtedness” set forth in the Credit
Agreement.
          “Initial Junior Indenture” has the meaning set forth in the recitals.
          “Initial Junior Noteholder Collateral Agent” has the meaning set forth
in the recitals.
          “Initial Junior Notes” has the meaning set forth in the recitals.
          “Initial Junior Trustee” means Wilmington Trust Company, in its
capacity as trustee under the Initial Junior Indenture, and its permitted
successors and assigns.

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          “Initial Mortgaged Collateral” has the meaning set forth in the Credit
Agreement.
          “Insolvency or Liquidation Proceeding” means (a) any voluntary or
involuntary case or proceeding under any Bankruptcy Law with respect to any
Grantor as a debtor, (b) any other voluntary or involuntary insolvency,
reorganization or bankruptcy case or proceeding, or any receivership,
liquidation, reorganization or other similar case or proceeding with respect to
any Grantor or with respect to any material part of their respective assets,
(c) any liquidation, dissolution, reorganization or winding up of any Grantor
whether voluntary or involuntary and whether or not involving insolvency or
bankruptcy or (d) any assignment for the benefit of creditors or any other
marshalling of assets and liabilities of any Grantor.
          “Investment Property” has the meaning set forth in the Uniform
Commercial Code.
          “Junior Indentures” has the meaning set forth in the recitals hereto.
          “Junior Mortgage Tax Collateral” has the meaning set forth in
Section 5.8(a).
          “Junior Noteholder Claims” means all Indebtedness incurred pursuant to
the Junior Indentures and all Obligations with respect thereto.
          “Junior Noteholder Collateral” means all of the assets of any Grantor,
whether real, personal or mixed, with respect to which a Lien is granted as
security for any Junior Noteholder Claim.
          “Junior Noteholder Collateral Agents” means the Initial Junior
Noteholder Collateral Agent and any Additional Junior Noteholder Collateral
Agents.
          “Junior Noteholder Collateral Documents” means any agreement, document
or instrument pursuant to which a Lien is granted by any Grantor to secure any
Junior Noteholder Claims or under which rights or remedies with respect to any
such Lien are governed as the same may be amended, restated or otherwise
modified from time to time as permitted by this Agreement.
          “Junior Noteholder Documents” means collectively (a) the Junior
Indentures, the Junior Notes, the Junior Noteholder Collateral Documents and
(b) any other related document or instrument executed and delivered pursuant to
any Junior Noteholder Document described in clause (a) of this definition
evidencing or governing any Obligations thereunder as the same may be amended,
restated or otherwise modified from time to time.
          “Junior Noteholder Pledge Agreements” means the Pledge Agreement,
dated as of December 3, 2008, among the Company, certain other Grantors and the
Initial Junior Trustee (the “Initial Junior Noteholder Pledge Agreement”) and
any other Pledge Agreement among the Company, certain other Grantors and any
Additional Junior Trustee, provided that the terms of such other Pledge
Agreements are substantially similar to the terms of the Initial Junior
Noteholder Pledge Agreement.

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          “Junior Noteholder Security Agreements” means the Security Agreement,
dated as of December 3, 2008, among the Company, the other Grantors and the
Initial Junior Trustee (the “Initial Junior Noteholder Security Agreement”) and
any other Security Agreement among the Company, the other Grantors and an
Additional Junior Trustee. provided that the terms of such other Security
Agreements are substantially similar to the terms of the Initial Junior
Noteholder Security Agreement.
          “Junior Noteholders” means the Persons holding Junior Noteholder
Claims, including the Junior Trustees.
          “Junior Notes” means the Initial Junior Notes (including any exchange
notes issued in respect thereof) and the Additional Junior Notes (including any
exchange notes issued in respect thereof).
          “Junior Trustees” means the Initial Junior Trustee and any Additional
Junior Trustees.
          “Lien” means, with respect to any asset, any mortgage, deed of trust,
lien, pledge, hypothecation, encumbrance, charge or security interest in, on or
of such asset.
          “Mortgage Tax Collateral Agent” has the meaning set forth in the
recitals.
          “Mortgage Tax States” means the states of Florida, Maryland,
Washington, D.C., Minnesota, Virginia, New York and Georgia, and any other
state(s) identified to the Mortgage Tax Collateral Agent by the Company and the
First-Lien Administrative Agent which requires a significant payment of mortgage
recording taxes or other fees or taxes of a comparable nature and magnitude as
that of any of the foregoing Mortgage Tax States.
          “Obligations” means, with respect to any Indebtedness, any and all
obligations with respect to the payment of (a) any principal of or interest
(including interest accruing on or after the commencement of any Insolvency or
Liquidation Proceeding, whether or not a claim for post-filing interest is
allowed in such proceeding) or premium on any Indebtedness, including any
reimbursement obligation in respect of any letter of credit, (b) any fees,
indemnification obligations, expense reimbursement obligations or other
liabilities payable under the documentation governing such Indebtedness, (c) any
obligation to post cash collateral in respect of letters of credit and any other
obligations and/or (d) Hedging Obligations in connection with such Indebtedness.
          “Person” means any natural person, corporation, limited liability
company, trust, joint venture, association, company, partnership, entity or
other party, including any government and any political subdivision, agency or
instrumentality thereof.
          “Pledged Collateral” means (a) the Common Collateral in the possession
or control of the Senior Credit Agent (or, after the Discharge of Senior Lender
Claims, the Senior Noteholder Collateral Agent) (or its agents or bailees), to
the extent that possession or control thereof is necessary to perfect a Lien
thereon under the Uniform Commercial Code and (b) the “Pledged Collateral”
under, and as defined in, the Junior Noteholder Pledge Agreements that is Common
Collateral.

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          “Proceeds” means the following property (a) whatever is acquired upon
the sale, lease, license, exchange or other disposition of Common Collateral,
whether such sale, lease, license or other disposition is made by or on behalf
of a Grantor, the First-Lien Administrative Agent, the Senior Credit Agent, the
Senior Noteholder Collateral Agent, the Senior Trustee, any Junior Noteholder
Collateral Agent, any Junior Trustee, the Mortgage Tax Collateral Agent or any
other person, (b) whatever is collected on, or distributed on account of, Common
Collateral, (c) rights arising out of the loss, nonconformity, or interference
with the use of, defects or infringements of rights in, or damage to, the Common
Collateral, (d) rights arising out of the Common Collateral, or (e) to the
extent of the value of the Common Collateral, and to the extent payable to the
debtor or the secured party, insurance payable by reason of the loss or
nonconformity of, defects or infringement of rights in, or damage to, the Common
Collateral.
          “Recovery” has the meaning set forth in Section 6.5.
          “Required Lenders” means, with respect to any Senior Credit Agreement,
those Senior Lenders the approval of which is required to approve an amendment
or modification of, termination or waiver of any provision of or consent or
departure from the Senior Credit Agreement (or would be required to effect such
consent under this Agreement if such consent were treated as an amendment of the
Senior Credit Agreement).
          “Security Documents” means, collectively, the Junior Noteholder
Collateral Documents, the Senior Noteholder Collateral Documents and the Senior
Lender Collateral Documents.
          “Senior Claims” means, collectively, the Senior Lender Claims and the
Senior Noteholder Claims.
          “Senior Collateral Documents” means any agreement, document or
instrument pursuant to which a Lien is granted securing any Senior Lender Claims
or under which rights or remedies with respect to such Liens are governed as the
same may be amended, restated or otherwise modified from time to time.
          “Senior Credit Agent” has the meaning set forth in the recitals.
          “Senior Credit Agreement” means the Credit Agreement and any other
agreement governing First-Lien Indebtedness.
          “Senior Creditors” means, collectively, the Senior Lenders and the
Senior Noteholders.
          “Senior Indebtedness” means, collectively, (a) First-Lien Indebtedness
and (b) Indebtedness incurred pursuant to the Senior Indenture and all renewals,
extensions, refundings, restructurings, replacements and refinancings thereof.
          “Senior Indenture” has the meaning set forth in the recitals hereto.
          “Senior Intercreditor Agreement” means the Intercreditor Agreement,
dated as of May 27, 2008, among the Hovnanian, the Company, each other Grantor
party thereto, the First-

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Lien Administrative Agent, the Senior Credit Agent, the Senior Noteholder
Collateral Agent, the Senior Trustee and Wilmington Trust Company, as mortgage
tax collateral agent.
          “Senior Lender Claims” means all First-Lien Indebtedness outstanding
including any Future First-Lien Indebtedness, and all Obligations in respect
thereto. Senior Lender Claims shall include all interest and expenses accrued or
accruing (or that would, absent the commencement of an Insolvency or Liquidation
Proceeding, accrue) after the commencement of an Insolvency or Liquidation
Proceeding in accordance with and at the rate specified in the relevant Senior
Lender Document whether or not the claim for such interest or expenses is
allowed as a claim in such Insolvency or Liquidation Proceeding.
          “Senior Lender Collateral” means all of the assets of any Grantor,
whether real, personal or mixed, with respect to which a Lien is granted as
security for any Senior Lender Claim.
          “Senior Lender Documents” means the Senior Credit Agreement, the
Senior Collateral Documents, and each of the other agreements, documents and
instruments (including each agreement, document or instrument providing for or
evidencing a Senior Lender Hedging Obligation, providing for or evidencing any
other Obligation under the Credit Agreement and any other related document or
instrument executed or delivered pursuant to any Senior Lender Document at any
time or otherwise evidencing any Indebtedness arising under any Senior Lender
Document.
          “Senior Lender Hedging Obligations” means any Hedging Obligations
secured by any Common Collateral under the Senior Collateral Documents.
          “Senior Lenders” means the Persons holding Senior Lender Claims,
including the First-Lien Administrative Agent.
          “Senior Mortgage Tax Collateral” means the Mortgage Tax Collateral as
defined in the Senior Intercreditor Agreement.
          “Senior Noteholder Claims” means all Indebtedness incurred pursuant to
the Senior Indenture and all Obligations with respect thereto. Senior Noteholder
Claims shall include all interest and expenses accrued or accruing (or that
would, absent the commencement of an Insolvency or Liquidation Proceeding,
accrue) after the commencement of an Insolvency or Liquidation Proceeding in
accordance with and at the rate specified in the relevant Senior Noteholder
Document whether or not the claim for such interest or expenses is allowed as a
claim in such Insolvency or Liquidation Proceeding.
          “Senior Noteholder Collateral” means all of the assets of any Grantor,
whether real, personal or mixed, with respect to which a Lien is granted as
security for any Senior Noteholder Claim.
          “Senior Noteholder Collateral Agent” has the meaning set forth in the
recitals.
          “Senior Noteholder Collateral Documents” means any agreement, document
or instrument pursuant to which a Lien is granted by any Grantor to secure any
Senior Noteholder

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Claims or under which rights or remedies with respect to any such Lien are
governed as the same may be amended, restated or otherwise modified from time to
time as permitted by this Agreement.
          “Senior Noteholder Documents” means collectively (a) the Senior
Indenture, the Senior Notes, the Senior Noteholder Collateral Documents and
(b) any other related document or instrument executed and delivered pursuant to
any Senior Noteholder Document described in clause (a) of this definition
evidencing or governing any Obligations thereunder as the same may be amended,
restated or otherwise modified from time to time.
          “Senior Noteholder Pledge Agreement” means the Pledge Agreement, dated
as of May 27, 2008, among the Company, certain other Grantors and the Senior
Trustee.
          “Senior Noteholder Security Agreement” means the Security Agreement,
dated as of May 27, 2008, among the Company, the other Grantors and the Senior
Trustee.
          “Senior Noteholders” means the Persons holding Senior Noteholder
Claims, including the Senior Trustee.
          “Senior Notes” means the $600 million principal amount of 11 and 1/2%
Senior Second-Lien Secured Notes due 2013 issued by the Company pursuant to the
Senior Indenture (including any exchange notes issued in respect thereof).
          “Senior Trustee” means Wilmington Trust Company, in its capacity as
trustee under the Senior Indenture, and its permitted successors and assigns.
          “Subsidiary” means any “Subsidiary” of Hovnanian as defined in the
Senior Credit Agreement.
          “Unasserted Contingent Obligations” means at any time, Obligations for
taxes, costs, indemnifications, reimbursements, damages and other liabilities
(except for (i) the principal of and interest and premium (if any) on, and fees
relating to, any Indebtedness and (ii) contingent reimbursement obligations in
respect of amounts that may be drawn under letters of credit) in respect of
which no claim or demand for payment has been made (or, in the case of
Obligations for indemnification, no notice for indemnification has been issued
by the indemnitee) at such time.
          “Uniform Commercial Code” or “UCC” means the Uniform Commercial Code
as from time to time in effect in the State of New York.
          (b) Terms Generally. The definitions of terms herein shall apply
equally to the singular and plural forms of the terms defined. Whenever the
context may require, any pronoun shall include the corresponding masculine,
feminine and neuter forms. The words “include”, “includes” and “including” shall
be deemed to be followed by the phrase “without limitation”. The word “will”
shall be construed to have the same meaning and effect as the word “shall”.
Unless the context requires otherwise (a) any definition of or reference to any
agreement, instrument or other document herein shall be construed as referring
to such agreement, instrument or other document as from time to time amended,
supplemented or

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otherwise modified in accordance with this Agreement, (b) any reference herein
to any Person shall be construed to include such Person’s successors and
assigns, (c) the words “herein”, “hereof” and “hereunder”, and words of similar
import, shall be construed to refer to this Agreement in its entirety and not to
any particular provision hereof, (d) all references herein to Sections shall be
construed to refer to Sections of this Agreement and (e) the words “asset” and
“property” shall be construed to have the same meaning and effect and to refer
to any and all tangible and intangible assets and properties, including cash,
securities, accounts and contract rights.
          Section 2. Lien Priorities.
          2.1 Subordination. Notwithstanding the date, time, manner or order of
filing or recordation of any document or instrument or grant, attachment or
perfection of any Liens granted to the Junior Trustees, the Junior Noteholder
Collateral Agents or the Junior Noteholders on the Common Collateral or of any
Liens granted to First-Lien Administrative Agent, the Senior Credit Agent or the
Senior Lenders or to the Senior Trustee, the Senior Noteholder Collateral Agent
or the Senior Noteholders on the Common Collateral or to the Mortgage Tax
Collateral Agent with respect to the Junior Mortgage Tax Collateral or the
Senior Mortgage Tax Collateral and notwithstanding any provision of the UCC, or
any applicable law or the Junior Noteholder Documents, the Senior Noteholder
Documents or the Senior Lender Documents or any other circumstance whatsoever
(including any non-perfection of any Lien purporting to secure the Senior Claims
and/or the Junior Noteholder Claims, for example, the circumstance of
non-perfection of the Lien purporting to secure the Senior Claims and perfection
of the Lien purporting to secure the Junior Noteholder Claims), the Junior
Trustees, the Mortgage Tax Collateral Agent (to the extent of the interest of
the Junior Noteholders in the Common Collateral) and the Junior Noteholder
Collateral Agents, on behalf of themselves and the Junior Noteholders, hereby
agree that: (a) any Lien on the Common Collateral securing any Senior Claims now
or hereafter held by or on behalf of the First-Lien Administrative Agent, the
Senior Credit Agent, the Mortgage Tax Collateral Agent (other than to the extent
of the interest of the Junior Noteholders), any Senior Lenders, the Senior
Trustee, the Senior Noteholder Collateral Agent and the Senior Noteholders or
any agent or trustee therefor regardless of how acquired, whether by grant,
statute, operation of law, subrogation or otherwise, shall have priority over
and be senior in all respects and prior to any Lien on the Common Collateral
securing any of the Junior Noteholder Claims and (b) any Lien on the Common
Collateral securing any Junior Noteholder Claims now or hereafter held by or on
behalf of the Junior Trustees, the Mortgage Tax Collateral Agent (to the extent
of the interest of the Junior Noteholders in the Common Collateral), the Junior
Noteholder Collateral Agents, or any Junior Noteholders or any agent or trustee
therefor regardless of how acquired, whether by grant, statute, operation of
law, subrogation or otherwise, shall be junior and subordinate in all respects
to all Liens on the Common Collateral securing any Senior Claims. All Liens on
the Common Collateral securing any Senior Claims shall be and remain senior in
all respects and prior to all Liens on the Common Collateral securing any Junior
Noteholder Claims for all purposes, whether or not such Liens securing any
Senior Claims are subordinated to any Lien securing any other obligation of the
Company, any other Grantor or any other Person.
          2.2 Prohibition on Contesting Liens. Each of the Junior Trustees, the
Junior Noteholder Collateral Agents and the Mortgage Tax Collateral Agent for
itself and on behalf of

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each Junior Noteholder, each Senior Trustee, the Senior Noteholder Collateral
Agent and the Mortgage Tax Collateral Agent for itself and on behalf of each
Senior Noteholder and each of the First-Lien Administrative Agent, the Mortgage
Tax Collateral Agent and the Senior Credit Agent, for itself and on behalf of
each Senior Lender, agrees that it shall not (and hereby waives any right to)
contest or support any other Person in contesting, in any proceeding (including
any Insolvency or Liquidation Proceeding), the perfection, priority, validity or
enforceability of (a) a Lien securing any Senior Claims held by or on behalf of
any of the Senior Lenders or Senior Noteholders in the Common Collateral or
(b) a Lien securing any Junior Noteholder Claims held by or on behalf of any of
the Junior Noteholders in the Common Collateral, as the case may be; provided
that nothing in this Agreement shall be construed to prevent or impair the
rights of the First-Lien Administrative Agent, the Mortgage Tax Collateral
Agent, the Senior Credit Agent, any Senior Lender, the Senior Trustee, the
Senior Noteholder Collateral Agent or any Senior Noteholder to enforce this
Agreement, including the priority of the Liens securing the Senior Claims as
provided in Section 2.1 and 3.1.
          2.3 No New Liens. So long as the Discharge of Senior Claims has not
occurred, the parties hereto agree that, after the date hereof, if the Junior
Trustees and/or the Junior Noteholder Collateral Agents shall hold any Lien on
any assets of the Company or any other Grantor securing any Junior Noteholder
Claims that are not also subject to the first-priority Lien in respect of the
Senior Lender Claims under the Senior Lender Documents and the second-priority
Lien in respect of the Senior Noteholder Claims under the Senior Noteholder
Documents, the Junior Trustees and/or the Junior Noteholder Collateral Agents,
upon demand by the First-Lien Administrative Agent, Senior Credit Agent, the
Senior Trustee, the Senior Noteholder Collateral Agent or the Company, will
assign such Lien to the Senior Credit Agent, the Mortgage Tax Collateral Agent
and/or the Senior Noteholder Collateral Agent as security for the relevant
Senior Claims (in which case the Junior Trustees may retain a junior lien on
such assets subject to the terms hereof).
          2.4 Perfection of Liens. Except as provided in Section 5.5, 5.6 and
5.9, none of the First-Lien Administrative Agent, the Mortgage Tax Collateral
Agent, the Senior Credit Agent, the Senior Lenders, the Senior Trustee, the
Senior Noteholder Collateral Agent nor the Senior Noteholders shall be
responsible for perfecting and maintaining the perfection of Liens with respect
to the Common Collateral for the benefit of the Junior Trustees, the Junior
Noteholder Collateral Agents and/or the Junior Noteholders. The provisions of
this Intercreditor Agreement are intended solely to govern the respective Lien
priorities as between the respective Senior Creditors and the Junior Noteholders
and shall not impose on the First-Lien Administrative Agent, the Senior Credit
Agent, the Senior Lenders, the Mortgage Tax Collateral Agent, the Senior
Trustee, the Senior Noteholder Collateral Agent, the Junior Trustees, the Junior
Noteholder Collateral Agents, the Senior Noteholders or the Junior Noteholders
any obligations in respect of the disposition of Proceeds of any Common
Collateral which would conflict with prior perfected claims therein in favor of
any other Person or any order or decree of any court or governmental authority
or any applicable law.
          2.5 Recording of Liens. Each of the Junior Trustees, the Junior
Noteholder Collateral Agents, and the Junior Noteholders agree that until the
prior Lien of the Senior Lenders and the Senior Noteholders on any Common
Collateral has been recorded or otherwise perfected, each will take commercially
reasonable efforts not to file or to otherwise perfect a

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Lien against such Common Collateral. If, notwithstanding the preceding sentence,
any Junior Trustee, any Junior Noteholder Collateral Agent and any Junior
Noteholders have recorded or otherwise perfected a Lien prior to recording or
other perfection of the Lien of the Senior Lenders and/or the Senior Noteholders
on any Common Collateral, upon written request of the First-Lien Administrative
Agent or the Senior Noteholder Collateral Agent, they and each of them will
record a subordination of such Lien to the Lien of the Senior Lenders and/or the
Senior Noteholder, as the case may be, in form and substance reasonably
acceptable to the First-Lien Administrative Agent and/or the Senior Noteholder
Collateral Agent, as applicable. The First-Lien Administrative Agent and the
Senior Noteholder Collateral Agent will use commercially reasonable efforts to
record or otherwise perfect its security interest in the Common Collateral as
promptly as practicable.
          Section 3. Enforcement.
          3.1 Exercise of Remedies.
          (a) So long as the Discharge of Senior Claims has not occurred, even
if an event of default has occurred and remains uncured under the Junior
Noteholder Collateral Documents, and whether or not any Insolvency or
Liquidation Proceeding has been commenced by or against the Company or any other
Grantor, (i) the Junior Trustees, the Junior Noteholder Collateral Agents, and
the Mortgage Tax Collateral Agent, to the extent of any interest of the Junior
Noteholders, and the Junior Noteholders will not exercise or seek to exercise
any rights or remedies as a secured creditor (including set-off) with respect to
any Common Collateral on account of any Junior Noteholder Claims, institute any
action or proceeding with respect to the Common Collateral, or exercise any
remedies against the Common Collateral (including any action of foreclosure), or
contest, protest or object to any foreclosure proceeding or action brought with
respect to the Common Collateral by the First-Lien Administrative Agent, Senior
Credit Agent, any Senior Lender, the Mortgage Tax Collateral Agent, the Senior
Trustee, the Senior Noteholder Collateral Agent or any Senior Noteholder in
respect of Senior Claims, any exercise of any right under any lockbox agreement,
control agreement, landlord waiver or bailee’s letter or similar agreement or
arrangement to which any Junior Trustee, any Junior Noteholder Collateral Agent,
the Mortgage Tax Collateral Agent or any Junior Noteholder is a party, or any
other exercise by any such party, of any rights and remedies as a secured
creditor relating to the Common Collateral under the Senior Lender Documents,
the Senior Noteholder Documents or otherwise in respect of Senior Claims, or
object to the forbearance by or on behalf of the Senior Lenders or the Senior
Noteholders from bringing or pursuing any foreclosure proceeding or action or
any other exercise of any rights or remedies relating to the Common Collateral
in respect of Senior Claims; provided that notwithstanding anything to the
contrary in this Section 3.1(a), the Mortgage Tax Collateral Agent shall not be
restricted from exercising or seeking to exercise the rights and remedies of a
secured creditor with respect to any Common Collateral in respect of Senior
Claims, and (ii) the First-Lien Administrative Agent, the Senior Credit Agent,
the Mortgage Tax Collateral Agent, the Senior Lenders, the Senior Trustee, the
Senior Noteholder Collateral Agent and the Senior Noteholders shall have the
exclusive right to enforce rights, exercise remedies (including set-off and the
right to credit bid their debt) and make determinations regarding the sale,
release, disposition, or restrictions with respect to the Common Collateral as a
secured creditor without any consultation with or the consent of any Junior
Trustee, any Junior Noteholder Collateral Agent or any Junior Noteholder;
provided that

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(A) in any Insolvency or Liquidation Proceeding commenced by or against any
Grantor, any Junior Trustee or any Junior Noteholder may file a claim or
statement of interest with respect to the Junior Noteholder Claims, (B) to the
extent it would not prevent, restrict or otherwise limit any rights granted or
created hereunder or under any Senior Lender Collateral Documents in favor of
the First-Lien Administrative Agent or any other Senior Lender in respect of the
Common Collateral or under any Senior Noteholder Collateral Documents in favor
of the Senior Noteholder Collateral Agent, the Mortgage Tax Collateral Agent or
any Senior Noteholders in respect of the Common Collateral, any Junior Trustee
or any Junior Noteholder may take any action not adverse to the Liens on the
Common Collateral securing the Senior Claims in order to preserve, perfect or
protect its respective rights in the Common Collateral, (C) to the extent it
would not prevent, restrict or otherwise limit any rights granted or created
hereunder or under any Senior Lender Collateral Documents in favor of the
First-Lien Administrative Agent, the Mortgage Tax Collateral Agent, the Senior
Credit Agent, or any other Senior Lender in respect of the Common Collateral or
under any Senior Noteholder Collateral Documents in favor of the Senior
Noteholder Collateral Agent or any Senior Noteholders in respect of the Common
Collateral, any Junior Trustee or any Junior Noteholder shall be entitled to
file any necessary responsive or defensive pleadings in opposition to any
motion, claim, adversary proceeding or other pleadings made by any person
objecting to or otherwise seeking the disallowance of the Junior Noteholder
Claims, including without limitation any claims secured by the Common
Collateral, if any, in each case in accordance with the terms of this Agreement,
or (D) any Junior Trustee or any Junior Noteholder shall be entitled to file any
pleadings, objections, motions or agreements which assert rights or interests
available to unsecured creditors of the Grantors arising under either Bankruptcy
Law or applicable non-bankruptcy law, in each case in accordance with the terms
of this Agreement. In exercising rights and remedies with respect to the Common
Collateral, the First-Lien Administrative Agent, the Senior Credit Agent, the
Senior Lenders, the Senior Trustee, the Senior Noteholder Collateral Agent and
the Senior Noteholders may enforce the provisions of the Senior Lender Documents
or the Senior Noteholder Documents, as applicable, and exercise remedies
thereunder, all in such order and in such manner as they may determine in the
exercise of their sole discretion. Such exercise and enforcement shall include
the rights of an agent appointed by them to sell or otherwise dispose of Common
Collateral upon foreclosure, to cause the Grantors to deliver a transfer
document in lieu of foreclosure to the Senior Lenders or any nominee of the
Senior Lenders (or, if the Discharge of the Senior Lender Claims has occurred,
to the Senior Noteholders or any nominee of the Senior Noteholders), to incur
expenses in connection with such sale or disposition, and to exercise all the
rights and remedies of a mortgagee in any applicable jurisdiction and a secured
lender under the Uniform Commercial Code of any applicable jurisdiction and of a
secured creditor under Bankruptcy Laws of any applicable jurisdiction. Upon the
Discharge of Senior Claims, the Junior Trustees, the Junior Noteholder
Collateral Agents and the Mortgage Tax Collateral Agent, on behalf of themselves
and the Junior Noteholders, will not be required to release their claims on any
Common Collateral that has not been sold or otherwise disposed of in connection
with the Discharge of Senior Claims.
          (b) The Junior Trustees and the Junior Noteholder Collateral Agents
and the Mortgage Tax Collateral Agent (with respect to the Mortgage Tax
Collateral Agent solely to the extent of any interest of the Junior Noteholders
in the Common Collateral) on behalf of themselves and the Junior Noteholders,
agree that solely as to the Common Collateral, they and each of them will not,
in connection with the exercise of any right or remedy with respect to the

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Common Collateral, receive any Common Collateral or Proceeds of any Common
Collateral in respect of Junior Noteholder Claims, or, upon or in any Insolvency
or Liquidation Proceeding (except under any plan of reorganization approved by
the Senior Creditors or as provided in section 6.6) with respect to any Grantor
as debtor, take or receive any Common Collateral or any Proceeds of Common
Collateral in respect of Junior Noteholder Claims, unless and until the
Discharge of Senior Claims has occurred. Without limiting the generality of the
foregoing, unless and until the Discharge of Senior Claims has occurred, except
as expressly provided in the proviso in clause (ii) of Section 3.1(a) or
Section 6.3, the sole right of the Junior Trustees, the Junior Noteholder
Collateral Agents and the Junior Noteholders with respect to the Common
Collateral is to hold a Lien on the Common Collateral in respect of Junior
Noteholder Claims pursuant to the Junior Noteholder Documents for the period and
to the extent granted therein and to receive a share of the Proceeds thereof, if
any, after the Discharge of Senior Claims has occurred. In addition to the
foregoing, the Junior Noteholders hereby acknowledge that the Junior Indentures
and the Junior Noteholder Documents permit the Company and the other Grantors to
repay Senior Claims with Proceeds from the disposition of the Common Collateral
prior to application to repay the Junior Noteholders Claims, and agree that to
the extent the Senior Lender Documents or the Senior Noteholder Documents
require repayment of the Senior Claims with Proceeds from such dispositions, the
Company shall pay such Proceeds to the Senior Creditors as so required and each
of the Junior Trustees, the Junior Noteholder Collateral Agents and the Junior
Noteholders will not take or receive such Proceeds until after so applied.
          (c) Subject to the proviso in clause (ii) of Section 3.1(a), the
Junior Trustees and the Junior Noteholder Collateral Agents, for themselves and
on behalf of the Junior Noteholders, agree that the Junior Trustees, the Junior
Noteholder Collateral Agents and the Junior Noteholders will not take any action
that would hinder any exercise of remedies undertaken by the First-Lien
Administrative Agent, the Senior Credit Agent, the Mortgage Tax Collateral
Agent, the Senior Lenders, the Senior Trustee, the Senior Noteholder Collateral
Agent or the Senior Noteholders with respect to the Common Collateral under the
Senior Lender Documents or the Senior Noteholder Documents, including any sale,
lease, exchange, transfer or other disposition of the Common Collateral, whether
by foreclosure or otherwise and shall release any and all claims in respect of
such Common Collateral (except for the right to receive the balance of Proceeds
and to be secured by the Common Collateral after Discharge of Senior Claims as
described in Section 4.1 and 5.1) so that it may be sold free and clear of the
Liens of the Junior Noteholders, the Junior Noteholder Collateral Agents and of
the Junior Trustees, on behalf of the Junior Noteholders, and the Junior
Trustees and the Junior Noteholder Collateral Agents, for themselves and on
behalf of any such Junior Noteholder, shall, within ten (10) Business Days of
written request by the Senior Credit Agent or the Senior Noteholder Collateral
Agent, execute and deliver to the Senior Credit Agent or the Senior Noteholder
Collateral Agent, as applicable, such termination statements, releases and other
documents as such agent may request to effectively confirm such release and the
Junior Trustees and the Junior Noteholder Collateral Agents, for themselves and
on behalf of the Junior Noteholders, hereby irrevocably constitute and appoint
the First-Lien Administrative Agent or the Senior Credit Agent or the Senior
Noteholder Collateral Agent or the Senior Trustee, as applicable, and any
officer or agent of such Person, with full power of substitution, as their true
and lawful attorney-in-fact with full irrevocable power and authority in the
place and stead of such Junior Trustee, such Junior Noteholder Collateral Agent
or such holder or in the First-Lien Administrative Agent or the Senior Credit
Agent’s or the Senior Noteholder Collateral Agent’s or the Senior Trustee’s, as

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15

applicable, own name, from time to time in the First-Lien Administrative Agent
or the Senior Credit Agent’s or the Senior Noteholder Collateral Agent’s or the
Senior Trustee’s discretion, for the purpose of carrying out the terms of this
Section 3.1(c), to take any and all appropriate action and to execute any and
all documents and instruments that may be necessary to accomplish the purposes
of this Section 3.1(c), including any termination statements, endorsements or
other instruments of transfer or release. In exercising rights and remedies with
respect to the Common Collateral, the First-Lien Administrative Agent, the
Senior Credit Agent, the Mortgage Tax Collateral Agent, the Senior Lenders, the
Senior Trustee, the Senior Noteholder Collateral Agent and the Senior
Noteholders may enforce the provisions of the Senior Lender Documents or the
Senior Noteholder Documents, as applicable, and exercise remedies thereunder,
all in such order and in such manner as they may determine in the exercise of
their sole discretion. Such exercise and enforcement shall include the rights of
an agent appointed by them to sell or otherwise dispose of Common Collateral
upon foreclosure, to cause the Grantors to deliver a transfer document in lieu
of foreclosure to the Senior Lenders or any nominee of the Senior Lenders or the
Senior Noteholders or any nominee of the Senior Noteholders, to incur expenses
in connection with such sale or disposition, and to exercise all the rights and
remedies of a mortgagee in any applicable jurisdiction and a secured creditor
under the Uniform Commercial Code or other laws of any applicable jurisdiction
and of a secured creditor under Bankruptcy Laws of any applicable jurisdiction.
The Junior Trustees and the Junior Noteholder Collateral Agents for themselves
and on behalf of the Junior Noteholders, hereby waive any and all rights they or
the Junior Noteholders may have as a junior lien creditor or otherwise to object
to the manner in which the First-Lien Administrative Agent, the Senior Credit
Agent, the Mortgage Tax Collateral Agent, the Senior Lenders, the Senior
Trustee, the Senior Noteholder Collateral Agent or the Senior Noteholders, seek
to enforce or collect the Senior Claims or the Liens granted in any of the
Common Collateral in respect of Senior Claims, regardless of whether any action
or failure to act by or on behalf of the First-Lien Administrative Agent, the
Senior Credit Agent, the Mortgage Tax Collateral Agent, the Senior Lenders, the
Senior Trustee, the Senior Noteholder Collateral Agent or the Senior Noteholders
is adverse to the interest of the Junior Noteholders. The Junior Trustees and
the Junior Noteholder Collateral Agents, for themselves and on behalf of the
Junior Noteholders, waive the right to commence any legal action or assert in
any legal action or in any Insolvency or Liquidation Proceeding any claim
against the Mortgage Tax Collateral Agent, the Senior Noteholders and/or Senior
Lenders seeking damages from the Mortgage Tax Collateral Agent, Senior
Noteholders or the Senior Lenders or other relief, by way of specific
performance, injunction or otherwise, with respect to any action taken or
omitted by the Mortgage Tax Collateral Agent, Senior Noteholders or the Senior
Lenders as permitted by this Agreement.
          (d) The Junior Trustees and the Junior Noteholder Collateral Agents
hereby acknowledge and agree that no covenant, agreement or restriction
contained in any Junior Noteholder Document shall be deemed to restrict in any
way the rights and remedies of the First-Lien Administrative Agent, the Senior
Credit Agent, the Mortgage Tax Collateral Agent, the Senior Lenders, the Senior
Trustee, the Senior Noteholder Collateral Agent or the Senior Noteholders with
respect to the Common Collateral as set forth in this Agreement, the Senior
Lender Documents and the Senior Noteholder Documents, to the extent consistent
with this Agreement.

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          3.2 Cooperation. Subject to the proviso in clause (ii) of
Section 3.1(a), the Junior Trustees and the Junior Noteholder Collateral Agents,
on behalf of themselves and the Junior Noteholders, agree that, unless and until
the Discharge of Senior Claims has occurred, they will not commence, or join
with any Person (other than the First-Lien Administrative Agent, the Senior
Lenders, the Senior Credit Agent, the Mortgage Tax Collateral Agent, the Senior
Trustee, the Senior Noteholder Collateral Agent and the Senior Noteholders upon
the written request thereof) in commencing any enforcement, collection,
execution, levy or foreclosure action or proceeding with respect to any Lien
held by it in the Common Collateral under any of the Junior Noteholder Documents
or otherwise in respect of the Junior Noteholder Claims.
          Section 4. Payments.
          4.1 Application of Proceeds. So long as the Discharge of Senior Claims
has not occurred, any Proceeds of any Common Collateral paid or payable to the
First-Lien Administrative Agent, the Senior Credit Agent, the Senior Noteholder
Collateral Agent or the Senior Trustee as provided in section 3.1(b) or pursuant
to the enforcement of any Security Document or the exercise of any right or
remedy with respect to the Common Collateral under the Senior Lender Documents
or the Senior Noteholder Documents, together with all other Proceeds received by
any Person (including all funds received in respect of post-petition interest or
fees and expenses) as a result of any such enforcement or the exercise of any
such remedial provision or as a result of any distribution of or in respect of
any Common Collateral (or the Proceeds thereof whether or not expressly
characterized as such) upon or in any Insolvency or Liquidation Proceeding
(except under any plan of reorganization approved by the Senior Creditors or as
provided in Section 6.6) with respect to any Grantor as debtor, shall be applied
by the First-Lien Administrative Agent, the Senior Credit Agent, the Senior
Noteholder Collateral Agent or the Senior Trustee to the Senior Claims in such
order as specified in the relevant Senior Lender Documents and/or Senior
Noteholder Documents. Upon the Discharge of Senior Claims, the First-Lien
Administrative Agent and/or the Senior Credit Agent and/or the Senior Trustee
and/or the Senior Noteholder Collateral Agent and/or the Mortgage Tax Collateral
Agent, as applicable, shall deliver to the Junior Trustees any Proceeds of
Common Collateral held by it in the same form as received, with any necessary
endorsements or as a court of competent jurisdiction may otherwise direct, to be
applied by the Junior Trustees to the Junior Noteholder Claims in such order as
specified in the Junior Noteholder Collateral Documents or, if not specified
therein, ratably to each such Junior Trustee based on the respective amount of
Junior Noteholder Claims owed under the Junior Noteholder Documents in which
respect such Junior Trustee is acting.
          4.2 Payments Over. So long as the Discharge of Senior Claims has not
occurred, any Common Collateral or Proceeds thereof received by any Junior
Trustee, any Junior Noteholder Collateral Agent or any Junior Noteholder in
connection with the exercise of any right or remedy (including set-off) relating
to the Common Collateral in contravention of this Agreement shall be segregated
and held in trust and forthwith paid over to the Senior Credit Agent for the
benefit of the Senior Creditors (or, at any time after the Discharge of the
Senior Lender Claims, to the Senior Trustee for the benefit of the Senior
Noteholders) in the same form as received, with any necessary endorsements or as
a court of competent jurisdiction may otherwise direct. If any Lien on Common
Collateral for Senior Indebtedness is void or voidable and the Lien on the same
Common Collateral of any Junior Trustee, any Junior Noteholder

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17

Collateral Agent or any Junior Noteholder is not void or voidable, the Proceeds
of such Lien received by any Junior Trustee, any Junior Noteholder Collateral
Agent or any Junior Noteholder shall be segregated and held in trust and
forthwith paid over to the Senior Credit Agent for the benefit of the Senior
Creditors (or, at any time after the Discharge of the Senior Lender Claims, to
the Senior Trustee for the benefit of the Senior Noteholders) in the same form
as received, with any necessary endorsements or as a court of competent
jurisdiction may otherwise direct. The Senior Credit Agent and the Senior
Trustee are hereby authorized to make any such endorsements as agent for any
such Junior Trustee, any such Junior Noteholder Collateral Agent or any such
Junior Noteholder. This authorization is coupled with an interest and is
irrevocable.
          Section 5. Other Agreements.
          5.1 Releases.
          (a) At such times as the Senior Creditors have released their Liens on
all, or any portion of, the Common Collateral, even if an event of default has
occurred and remains uncured under the Junior Noteholder Collateral Documents,
and whether or not any Insolvency or Liquidation Proceeding has been commenced
by or against the Company or any other Grantor, the Liens granted to the Junior
Trustees, the Mortgage Tax Collateral Agent or the Junior Noteholders on the
Common Collateral (or, in the case of a release of Liens on only a portion of
the Common Collateral, the portion of the Common Collateral on which the Liens
of the Senior Creditors were released) shall be automatically, unconditionally
and simultaneously released and the Junior Trustees, for themselves and on
behalf of the Junior Noteholders, promptly shall execute and deliver to the
First-Lien Administrative Agent, the Senior Trustee and the Company such
termination statements, releases and other documents as the First-Lien
Administrative Agent, the Senior Trustee and the Company may request to
effectively confirm such release; provided that, (A) in the event that the Liens
are released in connection with the Discharge of Senior Claims, the Liens
granted to the Junior Trustees, the Mortgage Tax Collateral Agent or the Junior
Noteholders on the Common Collateral will not be released, except to the extent
that the Common Collateral, or any portion thereof, was disposed of in order to
repay the Senior Claims, and thereafter, the Junior Trustees (acting at the
written direction of the Junior Noteholders) will have the right to exercise
remedies with respect to the Common Collateral and the restrictions in this
Agreement shall no longer apply, and (B) if the Senior Claims (or any portion
thereof) are thereafter secured by assets that would constitute Common
Collateral, the Junior Noteholder Claims shall then be secured by a third
priority Lien on such Common Collateral, to the same extent provided pursuant to
the Junior Noteholder Collateral Documents.
          (b) The Junior Trustees and the Junior Noteholder Collateral Agents,
for themselves and on behalf of the Junior Noteholders, hereby irrevocably
constitute and appoint the Senior Credit Agent, the First-Lien Administrative
Agent, the Senior Noteholder Collateral Agent and the Senior Trustee and any
officer or agent of the Senior Credit Agent, the First-Lien Administrative
Agent, the Senior Noteholder Collateral Agent or the Senior Trustee, with full
power of substitution, as its true and lawful attorney-in-fact with full
irrevocable power and authority in the place and stead of the Junior Trustees
and/or the Junior Noteholder Collateral Agents or such holder or in the Senior
Credit Agent’s, the First-Lien Administrative Agent’s, the Senior Noteholder
Collateral Agent’s or the Senior Trustee’s own name, from time to time in the

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Senior Credit Agent’s, First-Lien Administrative Agent’s, the Senior Noteholder
Collateral Agent’s and the Senior Trustee’s discretion, for the purpose of
carrying out the terms of this Section 5.1, to take any and all appropriate
action and to execute any and all documents and instruments that may be
necessary or desirable to accomplish the purposes of this Section 5.1, including
any termination statements, endorsements or other instruments of transfer or
release.
          5.2 Insurance. Unless and until the Discharge of Senior Claims has
occurred, the First-Lien Administrative Agent, the Senior Credit Agent, the
Senior Lenders, the Senior Trustee, the Senior Noteholder Collateral Agent and
the Senior Noteholders shall have the sole and exclusive right, subject to the
rights of the Grantors under the Senior Lender Documents and the Senior
Noteholder Documents, to adjust settlement for any insurance policy covering the
Common Collateral in the event of any loss thereunder and to approve any award
granted in any condemnation or similar proceeding affecting the Common
Collateral. Unless and until the Discharge of Senior Claims has occurred, all
proceeds of any such policy and any such award if in respect of the Common
Collateral shall be paid to the First-Lien Administrative Agent, the Senior
Credit Agent, the Mortgage Tax Collateral Agent, the Senior Trustee or the
Senior Noteholder Collateral Agent for the benefit of the Senior Lenders or the
Senior Noteholders, as applicable, to the extent required under the Senior
Lender Documents and the Senior Noteholder Documents in respect of the Senior
Claims and thereafter to the Junior Trustees for the benefit of the Junior
Noteholders to the extent required under the applicable Junior Noteholder
Documents and then to the owner of the subject property or as a court of
competent jurisdiction may otherwise direct. Subject to Section 5.4, if any
Junior Trustee, any Junior Noteholder Collateral Agent or any Junior Noteholder
shall, at any time, receive any proceeds of any such insurance policy or any
such award in contravention of this Agreement, it shall pay such proceeds over
to the First-Lien Administrative Agent or the Senior Trustee in accordance with
the terms of Section 4.2.
          5.3 Designation of Subordination; Amendments to Junior Noteholder
Collateral Documents.
          (a) The Junior Trustees and the Junior Noteholder Collateral Agents
agree that each Junior Noteholder Collateral Document shall include the
following language (or language to similar effect approved by the First-Lien
Administrative Agent and the Senior Noteholder Collateral Agent):
          “Notwithstanding anything herein to the contrary, the lien and
security interest granted to the Junior Trustee pursuant to this Agreement and
the exercise of any right or remedy by the Junior Trustee hereunder are subject
to the provisions of the Intercreditor Agreement, dated as of December 3, 2008
(as amended, supplemented or otherwise modified from time to time, the
“Intercreditor Agreement”), among K. Hovnanian Enterprises, Inc., Hovnanian
Enterprises, Inc., and certain subsidiaries of Hovnanian Enterprises, Inc.,
party thereto, PNC Bank, N.A., as Senior Credit Agent and First-Lien
Administrative Agent, Wilmington Trust Company, as Senior Trustee and Senior
Noteholder Collateral Agent, Wilmington Trust Company, as Mortgage Tax
Collateral Agent, Wilmington Trust Company, as Initial Junior Trustee and
Initial Junior Noteholder Collateral Agent and the other parties from time to
time partly thereto. In the event of any conflict between the terms of the
Intercreditor Agreement and this Agreement, the terms of the Intercreditor
Agreement shall govern.”

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          (b) Unless and until the Discharge of Senior Claims has occurred,
without the prior written consent of the First-Lien Administrative Agent and the
Senior Noteholder Collateral Agent, no Junior Noteholder Collateral Document may
be amended, supplemented or otherwise modified or entered into to the extent
such amendment, supplement or modification, or the terms of any new Junior
Noteholder Collateral Document, would be prohibited by or inconsistent with any
of the terms of this Agreement.
          (c) In the event that the First-Lien Administrative Agent, the Senior
Credit Agent, the Senior Lenders, the Senior Trustee, the Senior Noteholder
Collateral Agent or the Senior Noteholders enter into any amendment, waiver or
consent in respect of any of the Senior Collateral Documents for the purpose of
adding to, or deleting from, or waiving or consenting to any departures from any
provisions of, any Senior Collateral Document or any Senior Noteholder
Collateral Document or changing in any manner the rights of the First-Lien
Administrative Agent, the Senior Credit Agent, the Mortgage Tax Collateral
Agent, the Senior Lenders, the Senior Trustee, the Senior Noteholder Collateral
Agent, the Senior Noteholders, the Company or any other Grantor thereunder, then
such amendment, waiver or consent shall apply automatically to any comparable
provision of the Comparable Junior Noteholder Collateral Document without the
consent of the Junior Trustees, the Junior Noteholder Collateral Agents or the
Junior Noteholders and without any action by the Junior Trustees, the Junior
Noteholder Collateral Agents, the Company or any other Grantor; provided that
the consent of the Junior Noteholders shall be required only in the circumstance
that an amendment to the Senior Collateral Documents and/or the Senior
Noteholder Collateral Documents, as applicable, is prejudicial to the interests
of the Junior Noteholders to a greater extent than it is to the interests of the
Senior Creditors (other than by virtue of their relative priorities and rights
and obligations, and subject to increases in principal, interest or fees of the
Senior Creditors to the extent permitted in this Agreement). The Company will
use commercially reasonable efforts to notify the Junior Trustees and Junior
Noteholder Collateral Agents of such amendment(s) but the failure to provide
such notice shall not affect the application, validity or enforceability of such
amendment(s).
          5.4 Rights As Unsecured Creditors. Notwithstanding anything to the
contrary in this Agreement, the Junior Trustees and the Junior Noteholders may
exercise rights and remedies as an unsecured creditors against the Company,
Hovnanian or any Subsidiary that has guaranteed the Junior Noteholder Claims in
accordance with the terms of the Junior Noteholder Documents and applicable law.
Nothing in this Agreement shall prohibit the receipt by any Junior Trustee or
any Junior Noteholders of the required payments of interest and principal so
long as such receipt is not (i) the direct or indirect result of the exercise by
any Junior Trustee, any Junior Noteholder Collateral Agent, the Mortgage Tax
Collateral Agent or any Junior Noteholder of rights or remedies as a secured
creditor in respect of Common Collateral or (ii) in violation of Section 3.1,
4.1, 5.2 or 6.3. In the event any Junior Trustee, any Junior Noteholder
Collateral Agent or any Junior Noteholder becomes a judgment lien creditor in
respect of Common Collateral as a result of its enforcement of its rights as an
unsecured creditor in respect of Junior Noteholder Claims, such judgment lien
shall be subordinated to the Liens securing Senior Claims on the same basis as
the other Liens securing the Junior Noteholder Claims are so subordinated to
such Liens securing Senior Claims under this Agreement. Nothing in this
Agreement impairs or otherwise adversely affects any rights or remedies the
Senior Credit

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Agent, the Senior Lenders, the Senior Trustee or the Senior Noteholders may have
with respect to the Common Collateral.
          5.5 Bailee for Perfection — Senior Credit Agent.
Prior to the Discharge of Senior Lender Claims:
          (a) The Senior Credit Agent agrees to hold the Pledged Collateral that
is part of the Common Collateral in its possession or control (or in the
possession or control of its agents or bailees) as bailee for the Junior
Trustees and any assignee solely for the purpose of perfecting the security
interest granted in such Pledged Collateral pursuant to the Junior Noteholder
Security Agreements, subject to the terms and conditions of this Section 5.5.
          (b) The Senior Credit Agent agrees to hold the Deposit Account
Collateral that is part of the Common Collateral and controlled by the Senior
Credit Agent for the Junior Trustees and any assignee solely for the purpose of
perfecting the security interest granted in such Deposit Account Collateral
pursuant to the Junior Noteholder Security Agreements, subject to the terms and
conditions of this Section 5.5. Upon Discharge of Senior Lender Claims, the
First-Lien Administrative Agent shall continue to hold such Deposit Account
Collateral pursuant to this clause (b) until the earlier of the date (i) the
Senior Trustee (or, at any time after the Discharge of Senior Claims, the Junior
Trustees) has obtained control thereof for the purpose of perfecting its
security interest and (ii) which is 30 days after the Discharge of Senior Lender
Claims.
          (c) Except as otherwise specifically provided herein (including,
without limitation, Sections 3.1 and 4.1), until the Discharge of Senior Lender
Claims has occurred, the Senior Credit Agent shall be entitled to deal with the
Pledged Collateral in accordance with the terms of the Senior Lender Documents
as if the Liens under the Junior Noteholder Collateral Documents did not exist.
The rights of the Junior Trustees, the Junior Noteholder Collateral Agents and
the Junior Noteholders with respect to such Pledged Collateral shall at all
times be subject to the terms of this Agreement.
          (d) The Senior Credit Agent shall have no obligation whatsoever to the
Junior Trustees, the Junior Noteholder Collateral Agents or any Junior
Noteholder to assure that the Pledged Collateral is genuine or owned by any of
the Grantors or to protect or preserve rights or benefits of any Person or any
rights pertaining to the Common Collateral except as expressly set forth in this
Section 5.5. The duties or responsibilities of the Senior Credit Agent under
this Section 5.5 shall be limited solely to holding the Pledged Collateral as
bailee for the Junior Trustees for purposes of perfecting the Lien held by the
Junior Trustees.
          (e) The Senior Credit Agent shall not have by reason of the Junior
Noteholder Collateral Documents or this Agreement or any other document a
fiduciary relationship in respect of any Junior Trustee or any Junior Noteholder
and the Junior Trustees and the Junior Noteholders hereby waive and release the
Senior Credit Agent from all claims and liabilities arising pursuant to the
Senior Credit Agent’s role under this Section 5.5, as agent and bailee with
respect to the Common Collateral.

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          (f) Upon Discharge of Senior Lender Claims, the Senior Credit Agent
shall deliver to the Senior Trustee (or, upon Discharge of Senior Claims, as
applicable in accordance with Section 5.6(f), or at the direction of the
Company, to the Junior Trustees), to the extent that it is legally permitted to
do so, the remaining Pledged Collateral (if any) together with any necessary
endorsements (or otherwise allow the Senior Trustee or Junior Trustees, as the
case may be, to obtain control of such Pledged Collateral) or as a court of
competent jurisdiction may otherwise direct. The Company shall take such further
action as is required to effectuate the transfer contemplated hereunder and
shall indemnify the Senior Credit Agent for loss or damage suffered by the
Senior Credit Agent as a result of such transfer except for loss or damage
suffered by the Senior Credit Agent as a result of its own wilful misconduct or
bad faith. The Senior Credit Agent has no obligation to follow instructions from
the Junior Trustees in contravention of this Agreement. Without limiting the
foregoing, upon Discharge of Senior Lender Claims, the First-Lien Administrative
Agent will use commercially reasonable efforts to promptly deliver an
appropriate termination or other notice confirming such Discharge of Senior
Lender Claims to the applicable depositary bank, issuer of uncertificated
securities or securities intermediary, if any, with respect to the Deposit
Account Collateral, money market mutual fund or similar collateral, or
securities account collateral.
          (g) Neither the First-Lien Administrative Agent, the Senior Credit
Agent nor the Senior Lenders shall be required to marshal any present or future
collateral security for the Company’s or its Subsidiaries’ obligations to the
Senior Credit Agent or the Senior Lenders under the Senior Credit Agreement or
the Senior Collateral Documents or to resort to such collateral security or
other assurances of payment in any particular order, and all of their rights in
respect of such collateral security shall be cumulative and in addition to all
other rights, however existing or arising.
          5.6 Bailee For Perfection — Senior Trustee
At any time after the Discharge of Senior Lender Claims:
          (a) The Senior Trustee agrees to hold the Pledged Collateral that is
part of the Common Collateral in its possession or control (or in the possession
or control of its agents or bailees) as bailee for the Junior Trustees and any
assignee solely for the purpose of perfecting the security interest granted in
such Pledged Collateral pursuant to the Junior Noteholder Security Agreements,
subject to the terms and conditions of this Section 5.6.
          (b) The Senior Trustee agrees to hold the Deposit Account Collateral
that is part of the Common Collateral and controlled by the Senior Trustee for
the Junior Trustees and any assignee solely for the purpose of perfecting the
security interest granted in such Deposit Account Collateral pursuant to the
Junior Noteholder Security Agreements, subject to the terms and conditions of
this Section 5.6. Upon Discharge of Senior Claims, the Senior Trustee shall
continue to hold such Deposit Account Collateral pursuant to this clause
(b) until the earlier of the date (i) the Junior Trustees have obtained control
thereof for the purpose of perfecting their security interests and (ii) which is
30 days after the Discharge of Senior Claims.
          (c) Except as otherwise specifically provided herein (including,
without limitation, Sections 3.1 and 4.1), until the Discharge of Senior Claims
has occurred, the Senior

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Trustee shall be entitled to deal with the Pledged Collateral in accordance with
the terms of the Senior Noteholder Documents as if the Liens under the Junior
Noteholder Collateral Documents did not exist. The rights of the Junior
Trustees, the Junior Noteholder Collateral Agents and the Junior Noteholders
with respect to such Pledged Collateral shall at all times be subject to the
terms of this Agreement.
          (d) The Senior Trustee shall have no obligation whatsoever to the
Junior Trustees, the Junior Noteholder Collateral Agents or any Junior
Noteholder to assure that the Pledged Collateral is genuine or owned by any of
the Grantors or to protect or preserve rights or benefits of any Person or any
rights pertaining to the Common Collateral except as expressly set forth in this
Section 5.6. The duties or responsibilities of the Senior Trustee under this
Section 5.6 shall be limited solely to holding the Pledged Collateral as bailee
for the Junior Trustees for purposes of perfecting the Lien held by the Junior
Trustees.
          (e) The Senior Trustee shall not have by reason of the Junior
Noteholder Collateral Documents or this Agreement or any other document a
fiduciary relationship in respect of any Junior Trustee or any Junior Noteholder
and the Junior Trustees and the Junior Noteholders hereby waive and release the
Senior Credit Agent from all claims and liabilities arising pursuant to the
Senior Trustee’s role under this Section 5.6, as agent and bailee with respect
to the Common Collateral.
          (f) Upon Discharge of Senior Claims, the Senior Trustee shall deliver
to the Junior Trustees, to the extent that it is legally permitted to do so, the
remaining Pledged Collateral (if any) together with any necessary endorsements
(or otherwise allow the Junior Trustees to obtain control of such Pledged
Collateral) or as a court of competent jurisdiction may otherwise direct. The
Company shall take such further action as is required to effectuate the transfer
contemplated hereunder and shall indemnify the Senior Trustee for loss or damage
suffered by the Senior Trustee as a result of such transfer except for loss or
damage suffered by the Senior Trustee as a result of its own wilful misconduct
or bad faith. The Senior Trustee has no obligation to follow instructions from
the Junior Trustees in contravention of this Agreement. Without limiting the
foregoing, upon Discharge of Senior Claims, the Senior Trustee will use
commercially reasonable efforts to promptly deliver an appropriate termination
or other notice confirming such Discharge of Senior Claims to the applicable
depositary bank, issuer of uncertificated securities or securities intermediary,
if any, with respect to the Deposit Account Collateral, money market mutual fund
or similar collateral, or securities account collateral.
          (g) Neither the Senior Trustee, the Senior Noteholder Collateral Agent
nor the Senior Noteholders shall be required to marshal any present or future
collateral security for the Company’s or its Subsidiaries’ obligations to the
Senior Trustee or the Senior Noteholders under the Senior Indenture or the
Senior Noteholder Collateral Documents or to resort to such collateral security
or other assurances of payment in any particular order, and all of their rights
in respect of such collateral security shall be cumulative and in addition to
all other rights, however existing or arising.
          5.7 Additional Collateral. If any Lien is granted by any Grantor in
favor of or for the benefit of the Senior Lenders, the Senior Noteholders or the
Junior Noteholders on any collateral, including Liens on the Initial Mortgaged
Collateral and the Additional Mortgaged

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Collateral (other than Common Collateral identified as Junior Mortgage Tax
Collateral which shall be subject to the Liens of the Mortgage Tax Collateral
Agent), such Collateral shall also be subject to a Lien in favor of the Senior
Lenders, the Senior Noteholders and the Junior Noteholders in the relative lien
priority scheme set forth in Section 2.1.
          5.8 Collateral Agents; Collateral Documents.
          (a) Pursuant to the Collateral Agency Agreement, the Mortgage Tax
Collateral Agent shall act as collateral agent for the Senior Lenders, the
Senior Noteholders and the Junior Noteholders with respect to Liens granted on
real property located in the Mortgage Tax States (that is Initial Mortgaged
Collateral or Additional Mortgaged Collateral) as determined in accordance with
Section 5.8(c) below (the “Junior Mortgage Tax Collateral”). For the avoidance
of doubt, such Liens may be created by modifying the security instruments
creating the Liens on the existing Senior Mortgage Tax Collateral.
          (b) With respect to any and all Junior Noteholder Collateral other
than the Junior Mortgage Tax Collateral, the Junior Noteholder Collateral Agents
shall act as collateral agents on behalf of the applicable Junior Noteholders.
The Junior Noteholder Collateral Agents shall separately document their
respective Lien(s) on any and all Junior Noteholder Collateral other than Junior
Mortgage Tax Collateral.
          (c) Determination of Status of Mortgage Tax State Collateral; Reliance
by Mortgage Tax Collateral Agent. The determination of whether Liens to be
granted on Initial Mortgaged Collateral and Additional Mortgaged Collateral
would constitute Junior Mortgage Tax Collateral under the Credit Agreement shall
be made by the Company and the First-Lien Administrative Agent (or the Company
after the Discharge of Senior Lender Claims) in the reasonable exercise of each
of their discretion, and the First-Lien Administrative Agent (or the Company)
shall so notify the Mortgage Tax Collateral Agent in a written certificate of
such determination with, as applicable, a copy of such certificate to be
contemporaneously provided to the Company. The Mortgage Tax Collateral Agent
shall not be responsible for determining the status of any Collateral as Junior
Mortgage Tax Collateral and shall be entitled to rely on such certificate(s) of
the First-Lien Administrative Agent (or the Company) identifying that any
Collateral constitutes Junior Mortgage Tax Collateral and shall be under no
obligation to treat any Collateral not so identified as Junior Mortgage Tax
Collateral. Upon receipt of such certificate(s) from the First-Lien
Administrative Agent identifying any Collateral as Junior Mortgage Tax
Collateral, the Mortgage Tax Collateral Agent shall be entitled to treat such
Collateral as Junior Mortgage Tax Collateral for all purposes under this
Agreement. Any designation by the First-Lien Administrative Agent (or the
Company) that any Collateral is Junior Mortgage Tax Collateral shall be, subject
to the provisions of Section 5.1(a) hereof, irrevocable. Any such certificates
shall be full warrant to the Mortgage Tax Collateral Agent for any action taken,
suffered or omitted in reliance thereof.
          5.9 Release of Liens on, and Application of the Proceeds of, the
Junior Mortgage Tax Collateral.
          (a) In the event of any release of the Liens on the Junior Mortgage
Tax Collateral in respect of Senior Claims in accordance with the Senior
Collateral Documents and

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the Senior Noteholder Collateral Documents, the Junior Trustees and the Junior
Noteholder Collateral Agents, for themselves and on behalf of the Junior
Noteholders, promptly shall execute and deliver to the Mortgage Tax Collateral
Agent or the applicable Grantor such termination statements, releases and other
documents as the Mortgage Tax Collateral Agent or such Grantor may reasonably
request to effectively confirm such release in connection with a release
pursuant to Section 5.1.
          (b) Proceeds of the Junior Mortgage Tax Collateral shall be applied as
set forth in Section 4.1 so long as the Discharge of Senior Claims has not
occurred. Unless and until the Discharge of Senior Claims has occurred, except
as expressly provided in the proviso in clause (ii) of Section 3.1(a) and
Section 6.3, the sole right of the Junior Noteholders with respect to the Junior
Mortgage Tax Collateral is to hold a shared Lien on the Junior Mortgage Tax
Collateral in respect of Junior Noteholder Claims pursuant to the Junior
Noteholder Documents for the period and to the extent granted therein and to
receive a share of the Proceeds thereof, if any, after the Discharge of the
Senior Claims has occurred.
          (c) Except as otherwise specifically provided in Sections 3.1 and 4.1,
until the Discharge of Senior Claims has occurred, the Mortgage Tax Collateral
Agent shall be entitled to deal with the Junior Mortgage Tax Collateral in
accordance with the terms of the Senior Lender Documents as if the Liens under
the Junior Noteholder Collateral Documents did not exist. The rights of the
Junior Trustees, the Junior Noteholder Collateral Agents and the Junior
Noteholders with respect to such Pledged Collateral shall at all times be
subject to the terms of this Agreement.
          (d) The Mortgage Tax Collateral Agent shall have no obligation
whatsoever to the Junior Trustees, the Junior Noteholder Collateral Agents or
any Junior Noteholder to assure that the Junior Mortgage Tax Collateral is
genuine or owned by any of the Grantors or to protect or preserve rights or
benefits of any Person or any rights pertaining to the Common Collateral except
as expressly set forth in this Section 5.9.
          (e) Neither the Mortgage Tax Collateral Agent, the First-Lien
Administrative Agent, the Senior Credit Agent, the Senior Lenders, the Senior
Trustee, the Senior Noteholder Collateral Agent nor any of the Senior
Noteholders shall be required to marshal any present or future collateral
security for the Company’s or its Subsidiaries’ obligations to the Senior Credit
Agent or the Senior Lenders under the Senior Credit Agreement or the Senior
Collateral Documents or to the Senior Trustee or the Senior Noteholders under
the Senior Indenture or the Senior Noteholder Collateral Documents or to resort
to such collateral security or other assurances of payment in any particular
order, and all of their rights in respect of such collateral security shall be
cumulative and in addition to all other rights, however existing or arising.
          5.10 No Fiduciary Duty. The Junior Trustees and the Junior Noteholder
Collateral Agents agree, on behalf of themselves and the Junior Noteholders,
that the Senior Lenders, the Mortgage Tax Collateral Agent, the First-Lien
Administrative Agent, the Senior Credit Agent, the Senior Trustee, the Senior
Noteholder Collateral Agent and the Senior Noteholders shall not have by reason
of the Junior Noteholder Collateral Documents or this Agreement or any other
document, a fiduciary relationship in respect of any Junior Trustee, any Junior
Noteholder Collateral Agent or any Junior Noteholder.

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          5.11 Increases in the Principal Amount of the Senior Claims
Indebtedness or Junior Noteholder Claims. The Junior Noteholders may not
increase the stated principal amount of the Junior Noteholder Claims above
$700 million hereof without the consent the Required Lenders (but in any event
not more than 66 and 2/3%); provided that no consent is required after Discharge
of Senior Lender Claims. The Senior Creditors may not increase the stated
principal amount of the Senior Claims (exclusive of any increases to the amounts
permitted in the definition of First-Lien Indebtedness) without the consent of
the Junior Noteholders holding, at least, 51% in amount of the Junior Noteholder
Claims.
          Section 6. Insolvency or Liquidation Proceedings.
          6.1 Financing and Sale Issues.
          (a) If the Company or any other Grantor shall be subject to any
Insolvency or Liquidation Proceeding and the First-Lien Administrative Agent and
the Senior Trustee shall desire to permit the use of cash collateral or to
permit the Company or any other Grantor to obtain financing under Section 363 or
Section 364 of Title 11 of the United States Code or any similar Bankruptcy Law
(“DIP Financing”), then the Junior Trustees, the Junior Noteholder Collateral
Agents and the Mortgage Tax Collateral Agent, on behalf of themselves and the
Junior Noteholders agree that (i) if the Senior Creditors consent to such use of
cash collateral, the Junior Trustees, the Junior Noteholder Collateral Agents
and the Mortgage Tax Collateral Agent, on behalf of themselves and the Junior
Noteholders, shall be deemed to have consented to such use of cash collateral
and they will not request adequate protection except to the extent permitted in
Section 6.3 and (ii) if the Senior Creditors consent to DIP Financing that
provides for priming of or pari passu treatment with the Liens of the Senior
Creditors, the Junior Trustees, the Junior Noteholder Collateral Agents and the
Mortgage Tax Collateral Agent, on behalf of themselves and the Junior
Noteholders, will not raise any objection to and shall be deemed to have
consented to such DIP Financing, and to the extent the Liens securing the Senior
Claims under the Senior Collateral Documents and the Senior Noteholder
Collateral Documents are subordinated or pari passu with such DIP Financing,
they will subordinate their Liens in the Common Collateral to such DIP Financing
(and all Obligations relating thereto) and the Senior Claims on the same basis
as the other Liens securing the Junior Noteholder Claims are subordinated to
Liens securing Senior Claims under this Agreement.
          (b) The Junior Trustees, the Junior Noteholder Collateral Agents and
the Mortgage Tax Collateral Agent, on behalf of themselves and the Junior
Noteholders, agree that they will not raise any objection to or oppose a sale of
or other disposition of any Common Collateral free and clear of its Liens or
other claims under Section 363 of the Bankruptcy Code if the Senior Creditors
have consented to such sale or disposition of such assets so long as the
interests of the Junior Trustees, the Junior Noteholder Collateral Agents and
the Junior Noteholders in the Common Collateral attach to the Proceeds in the
relative priority scheme set forth in Section 2.1 and subject to the terms of
this Agreement.
          6.2 Relief from the Automatic Stay. Until the Discharge of Senior
Claims has occurred, the Junior Trustees, the Junior Noteholder Collateral
Agents and the Mortgage Tax Collateral Agent, on behalf of themselves and the
Junior Noteholders, agree that none of them shall seek relief from the automatic
stay or any other stay in any Insolvency or Liquidation

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Proceeding in respect of the Common Collateral, without the prior written
consent of the First-Lien Administrative Agent and the Senior Trustee.
          6.3 Adequate Protection. The Junior Trustees, the Junior Noteholder
Collateral Agents and the Mortgage Tax Collateral Agent, on behalf of themselves
and the Junior Noteholders, agree that none of them shall contest (or support
any other Person contesting) (a) any request by the First-Lien Administrative
Agent, the Senior Credit Agent, the Senior Lenders, the Senior Trustee or the
Senior Noteholders for adequate protection or (b) any objection by First-Lien
Administrative Agent, the Senior Credit Agent, the Senior Lenders, the Senior
Trustee, the Senior Noteholder Collateral Agent or the Senior Noteholders to any
motion, relief, action or proceeding based on First-Lien Administrative Agent’s,
the Senior Credit Agent’s, the Senior Lenders’, the Senior Trustee’s, the Senior
Noteholder Collateral Agent’s or the Senior Noteholders’ claiming a lack of
adequate protection. Notwithstanding the foregoing, in any Insolvency or
Liquidation Proceeding, (i) the Junior Trustees on behalf of themselves and the
Junior Noteholders, may seek or request adequate protection in the form of a
replacement Lien on additional collateral, provided that the Senior Creditors
are granted a Lien on such additional collateral before or at the same time the
Junior Noteholders are granted a Lien on such collateral and that such Lien
shall be subordinated to the Liens of the Senior Creditors and any DIP Financing
permitted under Section 6.1 (and all Obligations relating thereto) on the same
basis as the other Liens securing the Junior Noteholder Claims are so
subordinated to the Liens securing the Senior Indebtedness under this Agreement
and (ii) in the event that any Junior Trustee, on behalf of itself or any Junior
Noteholder, seeks or requests adequate protection and such adequate protection
is granted in the form of additional collateral securing the Junior Noteholder
Claims, such Liens shall be subordinated to the Liens on such collateral
securing the Senior Indebtedness and any such DIP Financing (and all Obligations
relating thereto) and any other Liens granted to the Senior Creditors as
adequate protection on the same basis as the other Liens securing the Junior
Noteholder Claims are so subordinated to such Liens securing the Senior Claims
under this Agreement and such additional collateral shall be included in and be
part of the Common Collateral. Except as provided in this Section, the Junior
Trustees, and the Junior Noteholder Collateral Agents, on behalf of themselves
and the Junior Noteholders, further agree that they will not seek or accept any
payments of adequate protection or any payments under Bankruptcy Code
Section 362(d)(3)(B).
          6.4 No Waiver; Voting Restrictions. Nothing contained herein shall
prohibit or in any way limit the Senior Credit Agent, any Senior Lender, the
Senior Trustee or any Senior Noteholder from objecting in any Insolvency or
Liquidation Proceeding or otherwise to any action taken by any of the Junior
Trustees or any of the Junior Noteholders, including the seeking by any Junior
Trustee or any Junior Noteholder of adequate protection or the asserting by any
Junior Trustee or any Junior Noteholder of any of its rights and remedies under
the Junior Noteholder Documents or otherwise. In any Insolvency or Liquidation
Proceeding, neither any Junior Trustee nor any Junior Noteholder shall vote any
Junior Noteholder Claim in favor of any plan of reorganization (of any Grantor)
unless (i) such plan provides for payment in full of the Senior Indebtedness,
(ii) such plan provides for the treatment of the Senior Claims in a manner that
preserves the relative lien priority of the Senior Claims over the Junior
Noteholder Claims to at least the same extent as set forth in this Agreement or
(iii) such plan is approved by the Senior Creditors.

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          6.5 Preference Issues; Recovery. If any Senior Creditor is required in
any Insolvency or Liquidation Proceeding or otherwise to turn over or otherwise
pay to the estate of the Company or any other Grantor (or any trustee, receiver
or similar person therefor), because the payment of such amount was declared to
be fraudulent or preferential in any respect or for any other reason, any
amount, whether received as proceeds of security, enforcement of any right of
set-off or otherwise (a “Recovery”), then the Senior Claims shall be reinstated
to the extent of such Recovery and deemed to be outstanding as if such payment
had not occurred and the Senior Creditors shall be entitled to a Discharge of
Senior Claims with respect to all such recovered amounts. If this Agreement
shall have been terminated prior to such Recovery, this Agreement shall be
reinstated in full force and effect, and such prior termination shall not
diminish, release, discharge, impair or otherwise affect the obligations of the
parties hereto.
          6.6 Reorganization Securities. If, in any Insolvency or Liquidation
Proceeding, debt obligations of the reorganized debtor secured by Liens upon any
property of the reorganized debtor are distributed, pursuant to a plan of
reorganization or similar dispositive restructuring plan, both on account of
Senior Claims and on account of Junior Noteholder Claims, then, to the extent
the debt obligations distributed on account of the Senior Claims and on account
of the Junior Noteholder Claims are secured by Liens upon the same property, the
provisions of this Agreement will survive the distribution of such debt
obligations pursuant to such plan and will apply with like effect to the Liens
securing such debt obligations.
          6.7 Application. This Agreement shall be applicable and the terms
hereof shall survive and shall continue in full force and effect prior to or
after the commencement of any Insolvency or Liquidation Proceeding. All
references herein to any Grantor shall apply to any trustee for such Person and
such Person as debtor in possession. The relative rights as to the Collateral
and Proceeds thereof shall continue after the filing thereof on the same basis
as prior to the date of the petition, subject to any court order approving the
financing of, or use of cash collateral by, any Grantor.
          6.8 Expense Claims. None of any Junior Noteholder Collateral Agent,
any Junior Trustee or any Junior Noteholder will assert or enforce, at any time
prior to the Discharge of Senior Claims, any claim under §506(c) of the
Bankruptcy Law senior to or on a parity with the Liens in favor of the
First-Lien Administrative Agent, the Senior Credit Agent, the Mortgage Tax
Collateral Agent, the Senior Lenders, the Senior Trustee, the Senior Noteholder
Collateral Agent and the Senior Noteholders for costs or expenses of preserving
or disposing of any Common Collateral.
          6.9 Post-Petition Claims. (a) None of any Junior Noteholder Collateral
Agent, any Junior Trustee or any Junior Noteholder shall oppose or seek to
challenge any claim by the First-Lien Administrative Agent, the Senior Credit
Agent, any Senior Lender, the Senior Trustee, the Senior Noteholder Collateral
Agent or any Senior Noteholder for allowance in any Insolvency or Liquidation
Proceeding of Senior Lender Claims consisting of post-petition interest, fees,
including legal fees, expenses or indemnities to the extent of the value of the
Lien in favor of the First-Lien Administrative Agent, the Senior Credit Agent,
the Mortgage Tax Collateral Agent and the Senior Lenders or the Lien in favor of
the Senior Trustee, the Senior Noteholder Collateral Agent and the Senior
Noteholders, without regard to the existence of the Lien of the Junior Trustees
on behalf of the Junior Noteholders on the Common Collateral.

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          (b) None of the First-Lien Administrative Agent, the Senior Credit
Agent, any other Senior Lender, the Senior Trustee or any Senior Noteholder
shall oppose or seek to challenge any claim by any Junior Trustee or any Junior
Noteholder for allowance in any Insolvency or Liquidation Proceeding of
Noteholder Claims consisting of post-petition interest, fees, including legal
fees, expenses or indemnities to the extent of the value of the Lien of any such
Junior Trustee on behalf of the Junior Noteholders on the Common Collateral
(after taking into account the Liens in favor of the First-Lien Administrative
Agent, the Senior Credit Agent and the Senior Lenders and in favor of the Senior
Trustee, the Senior Noteholder Collateral Agent and the Senior Noteholders).
          Section 7. Reliance; Waivers; etc.
          7.1 Reliance. The consent by the Senior Creditors to the execution and
delivery of the Junior Noteholder Documents to which the Senior Creditors have
consented and all loans and other extensions of credit made or deemed made on
and after the date hereof by the Senior Creditors to the Company or any
Subsidiary shall be deemed to have been given and made in reliance upon this
Agreement. Each Junior Trustee, solely on behalf of the applicable Junior
Noteholders, acknowledges, to the best of its knowledge, that the Junior
Noteholders have, independently and without reliance on the First-Lien
Administrative Agent, the Senior Credit Agent, any Senior Lender, the Senior
Trustee, the Senior Noteholder Collateral Agent or any Senior Noteholder, and
based on documents and information deemed by them appropriate, made their own
credit analysis and decision to enter into the applicable Junior Indenture, this
Agreement and the transactions contemplated hereby and thereby and they will
continue to make their own credit decision in taking or not taking any action
under such applicable Junior Indentures or this Agreement.
          7.2 No Warranties or Liability. Each Junior Trustee, on behalf of
itself and the applicable Junior Noteholders, acknowledges and agrees that each
of the First-Lien Administrative Agent, the Senior Credit Agent, the Mortgage
Tax Collateral Agent, the Senior Lenders, the Senior Trustee and the Senior
Noteholders have made no express or implied representation or warranty,
including with respect to the execution, validity, legality, completeness,
collectibility or enforceability of any of the Senior Lender Documents or the
Senior Noteholder Documents, the ownership of any Common Collateral or the
perfection or priority of any Liens thereon. The Senior Creditors will be
entitled to manage and supervise their respective loans and extensions of credit
under the Senior Lender Documents and the Senior Noteholder Documents in
accordance with law and as they may otherwise, in their sole discretion, deem
appropriate, and the Senior Creditors may manage their loans and extensions of
credit without regard to any rights or interests that the Junior Trustees or any
of the Junior Noteholders have in the Common Collateral or otherwise, except as
otherwise provided in this Agreement. None of the First-Lien Administrative
Agent, the Senior Credit Agent, the Mortgage Tax Collateral Agent, any Senior
Lender, the Senior Trustee, the Senior Noteholder Collateral Agent nor any
Senior Noteholder shall have any duty to the Junior Trustees, the Junior
Noteholder Collateral Agents or any of the Junior Noteholders to act or refrain
from acting in a manner that allows, or results in, the occurrence or
continuance of an event of default or default under any agreements with the
Company or any Subsidiary thereof (including the Junior Noteholder Documents),
regardless of any knowledge thereof that they may have or be charged with.
Except as expressly set forth in this Agreement, the First-Lien Administrative
Agent, the

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29

Senior Credit Agent, the Mortgage Tax Collateral Agent, the Senior Lenders, the
Senior Trustee, the Senior Noteholder Collateral Agent, the Senior Noteholders,
the Junior Trustees, the Junior Noteholder Collateral Agents and the Junior
Noteholders have not otherwise made to each other nor do they hereby make to
each other any warranties, express or implied, nor do they assume any liability
to each other with respect to (a) the enforceability, validity, value or
collectibility of any of the Junior Noteholder Claims, the Senior Noteholder
Claims, the Senior Lender Claims or any guarantee or security which may have
been granted to any of them in connection therewith, (b) the Company’s, the
Guarantors’ (as defined in the Senior Credit Agreement) or any Subsidiary’s
title to or right to transfer any of the Common Collateral or (c) any other
matter except as expressly set forth in this Intercreditor Agreement.
          7.3 Obligations Unconditional. All rights, interests, agreements and
obligations of the First-Lien Administrative Agent, the Senior Credit Agent, the
Mortgage Tax Collateral Agent, the Senior Lenders, the Senior Trustee, the
Senior Noteholder Collateral Agent and the Senior Noteholders and the Junior
Trustees, the Junior Noteholder Collateral Agents and the Junior Noteholders,
respectively, hereunder shall remain in full force and effect irrespective of:
          (a) any lack of validity or enforceability of any Senior Lender
Documents, any Senior Noteholder Documents or any Junior Noteholder Documents;
          (b) any change in the time, manner or place of payment of, or in any
other terms of, all or any of the Senior Claims or Junior Noteholder Claims, or
any amendment or waiver or other modification, including any increase in the
amount thereof, whether by course of conduct or otherwise, of the terms of the
Senior Credit Agreement or any other Senior Lender Document, of the terms of the
Senior Indenture or any other Senior Noteholder Document or of the terms of the
Junior Indentures or any other Junior Noteholder Document;
          (c) any exchange of any security interest in any Common Collateral or
any other collateral, or any amendment, waiver or other modification, whether in
writing or by course of conduct or otherwise, of all or any of the Senior Claims
or Junior Noteholder Claims or any guarantee thereof;
          (d) the commencement of any Insolvency or Liquidation Proceeding in
respect of the Company or any other Grantor; or
          (e) any other circumstances that otherwise might constitute a defense
available to, or a discharge of, the Company or any other Grantor in respect of
the Senior Claims, or of any Junior Trustee or any Junior Noteholder in respect
of this Agreement.
          Section 8. Miscellaneous.
          8.1 Continuing Nature of this Agreement; Severability. This Agreement
shall continue to be effective until the Discharge of Senior Claims shall have
occurred. This is a continuing agreement of lien subordination and the Senior
Lenders may continue, at any time and without notice to any Junior Trustee or
any Junior Noteholder, to extend credit and other financial accommodations and
lend monies to or for the benefit of the Company or any other

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30

Grantor constituting Senior Claims in reliance hereon. Any provision of this
Agreement that is prohibited or unenforceable in any jurisdiction shall not
invalidate the remaining provisions hereof, and any such prohibition or
unenforceability in any jurisdiction shall not invalidate or render
unenforceable such provision in any other jurisdiction. Notwithstanding anything
to the contrary set forth in this Agreement, after the Discharge of Senior
Lender Claims, the First-Lien Administrative Agent, the Senior Credit Agent and
the Senior Lenders shall not have any rights or obligations under this Agreement
other than as set forth in Sections 5.5(f), 6.5, 6.6 and 6.7.
          8.2 Amendments; Waivers. No amendment, modification or waiver of any
of the provisions of this Agreement by the Junior Trustees, the Senior Trustee,
the First-Lien Administrative Agent or the Mortgage Tax Collateral Agent shall
be deemed to be made unless the same shall be in writing signed on behalf of the
party making the same or its authorized agent and each waiver, if any, shall be
a waiver only with respect to the specific instance involved and shall in no way
impair the rights of the parties making such waiver or the obligations of the
other parties to such party in any other respect or at any other time. The
Company and other Grantors shall not have any right to consent to or approve any
amendment, modification or waiver of any provision of this Agreement except to
the extent their rights are affected.
          8.3 Information Concerning Financial Condition of the Company and the
Subsidiaries. The First-Lien Administrative Agent, the Senior Lenders, the
Senior Trustee and the Senior Noteholders, on the one hand, and the Junior
Trustees and the Junior Noteholders, on the other hand, shall each be
responsible for keeping themselves informed of (a) the financial condition of
the Company and the Subsidiaries and all endorsers and/or guarantors of the
Junior Noteholder Claims or the Senior Claims and (b) all other circumstances
bearing upon the risk of nonpayment of the Junior Noteholder Claims or the
Senior Claims. The First-Lien Administrative Agent, the Senior Lenders, the
Senior Trustee and the Senior Noteholders shall have no duty to advise the
Junior Trustees, the Junior Noteholder Collateral Agents or any Junior
Noteholder of information known to it or them regarding such condition or any
such circumstances or otherwise. In the event that the First-Lien Administrative
Agent, the Senior Credit Agent, any of the Senior Lenders, the Senior Trustee,
the Senior Noteholder Collateral Agent or any of the Senior Noteholders, in its
or their sole discretion, undertakes at any time or from time to time to provide
any such information to the Junior Trustees, the Junior Noteholder Collateral
Agents or any Junior Noteholder, it or they shall be under no obligation (w) to
make, and the First-Lien Administrative Agent, the Senior Credit Agent, the
Senior Lenders, the Senior Trustee, the Senior Noteholder Collateral Agent and
the Senior Noteholders, shall not make, any express or implied representation or
warranty, including with respect to the accuracy, completeness, truthfulness or
validity of any such information so provided, (x) to provide any additional
information or to provide any such information on any subsequent occasion,
(y) to undertake any investigation or (z) to disclose any information that,
pursuant to accepted or reasonable commercial finance practices, such party
wishes to maintain confidential or is otherwise required to maintain
confidential.
          8.4 Subrogation. The Junior Trustees, on behalf of themselves and the
Junior Noteholders, hereby agree not to assert or enforce any rights of
subrogation they may acquire as a result of any payment hereunder until the
Discharge of Senior Claims has occurred.

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31

          8.5 Application of Payments. Except as otherwise provided herein, all
payments received by the Senior Creditors may be applied, reversed and
reapplied, in whole or in part, to such part of the Senior Claims as the Senior
Creditors, in their sole discretion, deem appropriate, consistent with the terms
of the Senior Lender Documents and the Senior Noteholder Documents. Except as
otherwise provided herein, the Junior Trustees, on behalf of themselves and the
Junior Noteholders, assent to any such extension or postponement of the time of
payment of the Senior Claims or any part thereof and to any other indulgence
with respect thereto, to any substitution, exchange or release of any security
that may at any time secure any part of the Senior Claims and to the addition or
release of any other Person primarily or secondarily liable therefor.
          8.6 Consent to Jurisdiction; Waivers. The parties hereto consent to
the jurisdiction of any state or federal court located in New York, New York,
and consent that all service of process may be made by registered mail directed
to such party as provided in Section 8.7 for such party. Service so made shall
be deemed to be completed three days after the same shall be posted as
aforesaid. The parties hereto waive any objection to any action instituted
hereunder in any such court based on forum non conveniens, and any objection to
the venue of any action instituted hereunder in any such court. Each of the
parties hereto waives any right it may have to trial by jury in respect of any
litigation based on, or arising out of, under or in connection with this
Agreement, or any course of conduct, course of dealing, verbal or written
statement or action of any party hereto in connection with the subject matter
hereof.
          8.7 Notices. All notices to the Junior Noteholders, the Senior
Noteholders and the Senior Lenders permitted or required under this Agreement
may be sent to the Junior Trustees, the Senior Trustee and the First-Lien
Administrative Agent, respectively. Unless otherwise specifically provided
herein, any notice or other communication herein required or permitted to be
given shall be in writing and may be personally served, telecopied or sent by
electronic mail, courier service or U.S. mail and shall be deemed to have been
given when delivered in person or by courier service, upon receipt of a telecopy
or electronic mail or four Business Days after deposit in the U.S. mail
(registered or certified, with postage prepaid and properly addressed). For the
purposes hereof, the addresses of the parties hereto shall be as set forth below
each party’s name on the signature pages hereto, or, as to each party, at such
other address as may be designated by such party in a written notice to all of
the other parties.
          8.8 Further Assurances. Each Junior Trustee and each Junior Noteholder
Collateral Agent, on behalf of itself and the Junior Noteholders, the Senior
Trustee and the Senior Noteholder Collateral Agent, on behalf of itself and the
Senior Noteholders, and the First-Lien Administrative Agent, the Mortgage Tax
Collateral Agent and the Senior Credit Agent, on behalf of itself and the Senior
Lenders, agrees that each of them, at the expense of the Company, shall take
such further action and shall execute and deliver to the First-Lien
Administrative Agent, the Mortgage Tax Collateral Agent and the Senior Credit
Agent and the Senior Lenders such additional documents and instruments (in
recordable form, if requested) as the First-Lien Administrative Agent, the
Senior Credit Agent or the Senior Lenders may reasonably request to effectuate
the terms of and the lien priorities contemplated by this Agreement.
          8.9 Company Notice of the Discharge of Senior Claims. The Company
shall provide prompt written notice to the Junior Trustees of any Discharge of
the Senior Claims.

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32

          8.10 Governing Law. This Agreement has been delivered and accepted at
and shall be deemed to have been made at New York, New York and shall be
interpreted, and the rights and liabilities of the parties bound hereby
determined, in accordance with the laws of the State of New York.
          8.11 Binding on Successors and Assigns. This Agreement shall be
binding upon the First-Lien Administrative Agent, the Senior Credit Agent, the
Senior Lenders, the Mortgage Tax Collateral Agent, the Senior Trustee, the
Senior Noteholder Collateral Agent, the Senior Noteholders, the Junior Trustees,
the Junior Noteholder Collateral Agents, the Junior Noteholders, Hovnanian, the
Company, the Grantors, and their respective permitted successors and assigns.
Any corporation or association into which Wilmington Trust Company may be merged
or converted or with which it may be consolidated, or any corporation or
association resulting from any merger, conversion or consolidation to which
Wilmington Trust Company shall be a party, or any corporation or association to
which all or substantially all of the corporate trust business of Wilmington
Trust Company may be sold or otherwise transferred, shall be the successor to
Wilmington Trust Company in each of its capacities hereunder without any further
act.
          8.12 Specific Performance. The First-Lien Administrative Agent or the
Senior Trustee may demand specific performance of this Agreement. The Junior
Trustees, on behalf of themselves and the Junior Noteholders, hereby irrevocably
waives any defense based on the adequacy of a remedy at law and any other
defense that might be asserted to bar the remedy of specific performance in any
action that may be brought by the First-Lien Administrative Agent or the Senior
Trustee.
          8.13 Section Titles. The section titles contained in this Agreement
are and shall be without substantive meaning or content of any kind whatsoever
and are not a part of this Agreement.
          8.14 Counterparts; Telecopy Signatures. This Agreement may be signed
in any number of counterparts each of which shall be an original, but all of
which together shall constitute one and the same instrument; and, delivery of
executed signature pages hereof by telecopy transmission, or other electronic
transmission in .pdf or similar format, from one party to another shall
constitute effective and binding execution and delivery of this Agreement by
such party.
          8.15 Authorization. By its signature, each Person executing this
Agreement on behalf of a party hereto represents and warrants to the other
parties hereto that it is duly authorized to execute this Agreement. The
First-Lien Administrative Agent represents and warrants that this Agreement is
binding upon the Senior Lenders.
          8.16 No Third Party Beneficiaries; Successors and Assigns. This
Agreement and the rights and benefits hereof shall inure to the benefit of, and
be binding upon, each of the parties hereto and their respective successors and
assigns and shall inure to the benefit of each of, and be binding upon, the
holders of Senior Claims and Junior Noteholder Claims. No other Person shall
have or be entitled to assert rights or benefits hereunder.

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33

          8.17 Effectiveness. This Agreement shall become effective when
executed and delivered by the parties hereto. This Agreement shall be effective
both before and after the commencement of any Insolvency or Liquidation
Proceeding. All references to the Company or any other Grantor shall include the
Company or any other Grantor as debtor and debtor-in-possession and any receiver
or trustee for the Company or any other Grantor (as the case may be) in any
Insolvency or Liquidation Proceeding.
          8.18 First-Lien Administrative Agent and Trustees. It is understood
and agreed that (a) PNC Bank, National Association is entering into this
Agreement in its capacity as First-Lien Administrative Agent in the Senior
Credit Agreement, (b) Wilmington Trust Company is entering in this Agreement in
its capacity as Senior Trustee and the provisions of Article 7 of the Senior
Indenture applicable to the Senior Trustee thereunder shall also apply to the
Senior Trustee hereunder and (c) Wilmington Trust Company is entering in this
Agreement in its capacity as Initial Junior Trustee and the provisions of
Article 7 of the Initial Junior Indenture applicable to the Initial Junior
Trustee thereunder shall also apply to the Initial Junior Trustee hereunder.
          8.19 Designations. For purposes of the provisions hereof and the
Senior Indenture and the Junior Indentures requiring the Company to designate
Indebtedness for the purposes of the term “First-Lien Indebtedness,” any such
designation shall be sufficient if the relevant designation is set forth in
writing, signed on behalf of the Company by an officer thereof and delivered to
the Junior Trustees, the Senior Trustee and the First-Lien Administrative Agent.
For all purposes hereof and the Senior Indenture and the Junior Indentures, the
Company hereby designates the Indebtedness incurred pursuant to the Senior
Credit Agreement as First-Lien Indebtedness.
          8.20 Relative Rights; Conflict. Notwithstanding anything in this
Agreement to the contrary, nothing in this Agreement is intended to or will
(a) amend, waive or otherwise modify the provisions of the Senior Credit
Agreement, the Senior Indenture or the Junior Indentures or any other Senior
Lender Documents, Senior Noteholder Documents or Junior Noteholder Documents
entered into in connection with the Senior Credit Agreement, the Senior
Indenture or the Junior Indentures or permit the Company or any Subsidiary to
take any action, or fail to take any action, to the extent such action or
failure would otherwise constitute a breach of, or default under, the Senior
Credit Agreement or any other Senior Lender Documents entered into in connection
with the Senior Credit Agreement, the Senior Indenture or any other Senior
Noteholder Documents entered into in connection with the Senior Indenture or the
Junior Indentures or any other Junior Noteholder Documents entered into in
connection with the Junior Indentures, (b) change the relative priorities of the
Senior Claims or the Liens granted under the Senior Lender Documents and the
Senior Noteholder Documents on the Common Collateral (or any other assets) as
among the Senior Creditors, (c) otherwise change the relative rights of the
Senior Creditors in respect of the Common Collateral as among such Senior
Creditors or (d) obligate the Company or any Subsidiary to take any action, or
fail to take any action, that would otherwise constitute a breach of, or default
under, the Senior Credit Agreement or any other Senior Lender Document entered
into in connection with the Senior Credit Agreement, the Senior Indenture or any
other Senior Noteholder Documents entered into in connection with the Senior
Indenture or the Junior Indentures or any other Junior Noteholder Documents
entered into in connection with the Junior Indentures. As it relates to matters
between the Junior Trustees,

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34

the Junior Noteholder Collateral Agents and the Junior Noteholders on the one
hand, and the First-Lien Administrative Agent, the Senior Credit Agent, the
Senior Trustee, the Senior Noteholder Collateral Agent and the Senior
Noteholders, on the other hand, in any conflict between the provisions of this
Agreement and the Senior Lender Documents, the Senior Noteholder Documents or
the Junior Noteholder Documents, this Agreement shall govern.
          8.21 Senior Intercreditor Agreement. The provisions of this Agreement
shall not be (or be construed to be) an amendment, modification or other change
to the Senior Intercreditor Agreement and the provisions of the Senior
Intercreditor Agreement shall remain in full force and effect in accordance with
the terms thereof (as such provisions may be amended, modified or otherwise
supplemented from time to time in accordance with the terms thereof). To the
extent the terms of this Agreement conflict with the terms of the Senior
Intercreditor Agreement, the terms of the Senior Intercreditor Credit Agreement
shall control and provide for the respective rights of the Senior Credit Agent
and Senior Trustee, including, but not limited to, their respective lien
priorities, obligations, rights, remedies and priority of distribution.
[SIGNATURE PAGES FOLLOW]

 

--------------------------------------------------------------------------------

 

          IN WITNESS WHEREOF, each of the undersigned has caused this
Intercreditor Agreement to be duly executed and delivered as of the date first
above written.

                                  First-Lien Administrative Agent    
 
                    Notice Address:       PNC BANK, NATIONAL ASSOCIATION
in its capacity as First-Lien Administrative Agent     PNC Bank, National
Association                
 
                    Two Tower Center,18th Floor       By:        
 
                    E. Brunswick, NJ 08816           Name:     Attention:
Douglas G. Paul           Title:    
Telephone:
  (732) 220-3566                
Telecopy:
  (732) 220-3744                
 
                                Senior Credit Agent    
 
                    Notice Address:       PNC BANK, NATIONAL ASSOCIATION
in its capacity as Senior Credit Agent     PNC Bank, National Association      
         
 
                    Two Tower Center,18th Floor       By:        
 
                    E. Brunswick, NJ 08816           Name:    
Attention:
  Douglas G. Paul           Title:    
Telephone:
  (732) 220-3566                
Telecopy:
  (732) 220-3744                
 
                                Mortgage Tax Collateral Agent    
 
                    Notice Address:       WILMINGTON TRUST COMPANY
in its capacity as Mortgage Tax Collateral Agent    
 
                    Wilmington Trust Company                
 
                            By:        
 
                    Attention: James A. Hanley           Name:     Address:
Rodney Square North           Title:     1100 North Market Street              
  Wilmington, DE 19890-1605                 Phone 302-636-6453                
Fax 302-636-4145                

[INTERCREDITOR AGREEMENT]

 

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                  Notice Address:       Senior Trustee    
 
                        WILMINGTON TRUST COMPANY     Wilmington Trust Company  
    in its capacity as Senior Trustee    
 
               
Attention: Patrick Healy
               
Address: Rodney Square North
      By:        
 
               
1100 North Market Street
          Name:    
Wilmington, DE 19890-1605
          Title:    
Phone: 302 636 6391
               
Fax: 302 636 4149
               
 
                        Senior Noteholder Collateral Agent    
Notice Address:
                        WILMINGTON TRUST COMPANY
in its capacity as Senior Noteholder Collateral Agent    
Wilmington Trust Company
               
 
               
Attention: Patrick Healy
      By:        
 
               
Address: Rodney Square North
          Name:    
1100 North Market Street
          Title:    
Wilmington, DE 19890-1605
               
Phone: 302 636 6391
               
Fax: 302 636 4149
               
 
                Notice Address:       Initial Junior Trustee    
 
                        WILMINGTON TRUST COMPANY     Wilmington Trust Company  
    in its capacity as Initial Junior Trustee    
 
               
Attention: Patrick Healy
               
Address: Rodney Square North
      By:        
 
               
1100 North Market Street
          Name:    
Wilmington, DE 19890-1605
          Title:    
Phone: 302 636 6391
               
Fax: 302 636 4149
               

[INTERCREDITOR AGREEMENT]

 

--------------------------------------------------------------------------------

 

                          Initial Junior Noteholder Collateral Agent    
Notice Address:
                        WILMINGTON TRUST COMPANY             in its capacity as
Initial Junior Noteholder Collateral     Wilmington Trust Company       Agent  
 
 
               
Attention: Patrick Healy
               
Address: Rodney Square North
      By:        
 
               
1100 North Market Street
          Name:    
Wilmington, DE 19890-1605
          Title:    
Phone: 302 636 6391
               
Fax: 302 636 4149
               

[INTERCREDITOR AGREEMENT]

 

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            K. HOVNANIAN ENTERPRISES, INC.
      By:         Name:     David G. Valiaveedan      Title:     Vice-President
— Finance     

[INTERCREDITOR AGREEMENT]

 

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            HOVNANIAN ENTERPRISES, INC.
      By:         Name:     David G. Valiaveedan      Title:     Vice-President
- Finance        EASTERN TITLE AGENCY, INC.

FOUNDERS TITLE AGENCY, INC.

GOVERNOR’S ABSTRACT CO., INC.

HOVNANIAN DEVELOPMENTS OF FLORIDA, INC.

K. HOV INTERNATIONAL, INC.

K. HOV IP, II, INC.

K. HOV I P, INC.

K. HOVNANIAN ACQUISITIONS, INC.

K. HOVNANIAN AT BERNARDS IV, INC.

K. HOVNANIAN AT BRANCHBURG III, INC.

K. HOVNANIAN AT BRIDGEPORT, INC.

K. HOVNANIAN AT BRIDGEWATER VI, INC.

K. HOVNANIAN AT BURLINGTON III, INC.

K. HOVNANIAN AT BURLINGTON, INC.

K. HOVNANIAN AT CALABRIA, INC.

K. HOVNANIAN AT CAMERON CHASE, INC.

K. HOVNANIAN AT CARMEL DEL MAR, INC.

K. HOVNANIAN AT CASTILE, INC.

K. HOVNANIAN AT CHAPARRAL, INC.

K. HOVNANIAN AT CLARKSTOWN, INC.

K. HOVNANIAN AT CRESTLINE, INC.

K. HOVNANIAN AT DOMINGUEZ HILLS, INC.

K. HOVNANIAN AT EAST WHITELAND I, INC.

K. HOVNANIAN AT FREEHOLD TOWNSHIP I, INC.

K. HOVNANIAN AT HERSHEY’S MILL, INC.

K. HOVNANIAN AT HACKETTSTOWN, INC.

K. HOVNANIAN AT HIGHLAND VINEYARDS, INC.

K. HOVNANIAN AT HOPEWELL IV, INC.

[INTERCREDITOR AGREEMENT]

 

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            K. HOVNANIAN AT HOPEWELL VI, INC.

K. HOVNANIAN AT HOWELL TOWNSHIP, INC.

K. HOVNANIAN AT KINGS GRANT I, INC.

K. HOVNANIAN AT LA TERRAZA, INC.

K. HOVNANIAN AT LAKEWOOD, INC.

K. HOVNANIAN AT LOWER SAUCON, INC.

K. HOVNANIAN AT MAHWAH II, INC.

K. HOVNANIAN AT MAHWAH VI, INC.

K. HOVNANIAN AT MAHWAH VII, INC.

K. HOVNANIAN AT MANALAPAN, INC.

K. HOVNANIAN AT MARLBORO II, INC.

K. HOVNANIAN AT MARLBORO TOWNSHIP III, INC.

K. HOVNANIAN AT MARLBORO TOWNSHIP IV, INC.

K. HOVNANIAN AT MONTGOMERY I, INC.

K. HOVNANIAN AT MONROE II, INC.

K. HOVNANIAN AT NORTHERN WESTCHESTER, INC.

K. HOVNANIAN AT NORTHLAKE, INC.

K. HOVNANIAN AT OCEAN TOWNSHIP, INC.

K. HOVNANIAN AT OCEAN WALK, INC.

K. HOVNANIAN AT PERKIOMEN I, INC.

K. HOVNANIAN AT PERKIOMEN II, INC.

K. HOVNANIAN AT RANCHO CRISTIANITOS, INC.

K. HOVNANIAN AT RESERVOIR RIDGE, INC.

K. HOVNANIAN AT SAN SEVAINE, INC.

K. HOVNANIAN AT SARATOGA, INC.

K. HOVNANIAN AT SAWMILL, INC.

K. HOVNANIAN AT SCOTCH PLAINS II, INC.

K. HOVNANIAN AT SMITHVILLE, INC.

K. HOVNANIAN AT SOUTH BRUNSWICK V, INC.

K. HOVNANIAN AT STONE CANYON, INC.

K. HOVNANIAN AT STONY POINT, INC.

K. HOVNANIAN AT SYCAMORE, INC.

K. HOVNANIAN AT TANNERY HILL, INC.

K. HOVNANIAN AT THE BLUFF, INC.

K. HOVNANIAN AT THORNBURY, INC.

[INTERCREDITOR AGREEMENT]

 

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            K. HOVNANIAN AT TIERRASANTA, INC.

K. HOVNANIAN AT TROVATA, INC.

K. HOVNANIAN AT TUXEDO, INC.

K. HOVNANIAN AT UNION TOWNSHIP I, INC.

K. HOVNANIAN AT UPPER FREEHOLD TOWNSHIP I, INC.

K. HOVNANIAN AT UPPER MAKEFIELD I, INC.

K. HOVNANIAN AT VAIL RANCH, INC.

K. HOVNANIAN AT WALL TOWNSHIP VI, INC.

K. HOVNANIAN AT WALL TOWNSHIP VIII, INC.

K. HOVNANIAN AT WASHINGTONVILLE, INC.

K. HOVNANIAN AT WAYNE III, INC.

K. HOVNANIAN AT WAYNE V, INC.

K. HOVNANIAN AT WILDROSE, INC.

K. HOVNANIAN COMMUNITIES, INC.

K. HOVNANIAN COMPANIES NORTHEAST, INC.

K. HOVNANIAN COMPANIES OF CALIFORNIA, INC.

K. HOVNANIAN COMPANIES OF MARYLAND, INC.

K. HOVNANIAN COMPANIES OF NEW YORK, INC.

K. HOVNANIAN COMPANIES OF PENNSYLVANIA, INC.

K. HOVNANIAN COMPANIES OF SOUTHERN CALIFORNIA, INC.

K. HOVNANIAN COMPANIES OF VIRGINIA, INC.

K. HOVNANIAN CONSTRUCTION II, INC.

K. HOVNANIAN CONSTRUCTION III, INC.

K. HOVNANIAN CONSTRUCTION MANAGEMENT, INC.

K. HOVNANIAN DEVELOPMENTS OF VIRGINIA, INC.

K. HOVNANIAN DEVELOPMENTS OF ARIZONA, INC.

K. HOVNANIAN DEVELOPMENTS OF CALIFORNIA, INC.

K. HOVNANIAN DEVELOPMENTS OF CONNECTICUT, INC.

K. HOVNANIAN DEVELOPMENTS OF D.C., INC.

K. HOVNANIAN DEVELOPMENTS OF DELAWARE, INC.

K. HOVNANIAN DEVELOPMENTS OF GEORGIA, INC.

K. HOVNANIAN DEVELOPMENTS OF ILLINOIS, INC.

K. HOVNANIAN DEVELOPMENTS OF INDIANA, INC.

[INTERCREDITOR AGREEMENT]

 

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            K. HOVNANIAN DEVELOPMENTS OF KENTUCKY, INC.

K. HOVNANIAN DEVELOPMENTS OF MARYLAND, INC.

K. HOVNANIAN DEVELOPMENTS OF MICHIGAN, INC.

K. HOVNANIAN DEVELOPMENTS OF MINNESOTA, INC.

K. HOVNANIAN DEVELOPMENTS OF NEW JERSEY II, INC.

K. HOVNANIAN DEVELOPMENTS OF NEW JERSEY, INC.

K. HOVNANIAN DEVELOPMENTS OF NEW YORK, INC.

K. HOVNANIAN DEVELOPMENTS OF NORTH CAROLINA, INC.

K. HOVNANIAN DEVELOPMENTS OF OHIO, INC.

K. HOVNANIAN DEVELOPMENTS OF PENNSYLVANIA, INC.

K. HOVNANIAN DEVELOPMENTS OF SOUTH CAROLINA, INC.

K. HOVNANIAN DEVELOPMENTS OF TEXAS, INC.

K. HOVNANIAN DEVELOPMENTS OF WEST VIRGINIA, INC.

K. HOVNANIAN FORECAST HOMES NORTHERN, INC.

K. HOVNANIAN HOMES OF NORTH CAROLINA, INC.

K. HOVNANIAN HOMES OF VIRGINIA, INC.

K. HOVNANIAN PA REAL ESTATE, INC.

K. HOVNANIAN PORT IMPERIAL URBAN RENEWAL, INC.

K. HOVNANIAN PROPERTIES OF RED BANK, INC.

LANDARAMA, INC.

M&M AT LONG BRANCH, INC.

MCNJ, INC.

SEABROOK ACCUMULATION CORPORATION

[INTERCREDITOR AGREEMENT]

 

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            STONEBROOK HOMES, INC.

THE MATZEL & MUMFORD ORGANIZATION, INC.

WASHINGTON HOMES, INC.

WESTMINSTER HOMES, INC.

WESTMINSTER HOMES OF TENNESSEE, INC.

WH LAND I, INC.

WH PROPERTIES, INC.
      By:           David G. Valiaveedan        On behalf of, and as
Vice-President - Finance of each of
the foregoing corporations   

[INTERCREDITOR AGREEMENT]

 

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                         K. HOVNANIAN HOMES OF D.C., L.L.C.    
 
                    By:   K. Hovnanian Developments of D.C., Inc., as the sole
member of the foregoing limited liability company
 
               
 
      By:        
 
               
 
          David G. Valiaveedan    
 
          Vice-President — Finance    

                      FOUNDERS TITLE AGENCY OF MARYLAND, L.L.C.
GREENWAY FARMS UTILITY ASSOCIATES, L.L.C.
HOMEBUYERS FINANCIAL SERVICES, L.L.C.
HOVNANIAN LAND INVESTMENT GROUP OF MARYLAND, L.L.C.
HOVNANIAN LAND INVESTMENT GROUP, L.L.C.
K. HOVNANIAN AT KING FARM, L.L.C.
K. HOVNANIAN AT RODERUCK, L.L.C.
K. HOVNANIAN AT WILLOW BROOK, L.L.C.
K. HOVNANIAN COMPANIES METRO D.C. NORTH, L.L.C.
K. HOVNANIAN HOMES AT CAMP SPRINGS, L.L.C.
K. HOVNANIAN HOMES AT CIDER MILL, L.L.C.
 
                    By:   K. Hovnanian Developments of Maryland, Inc., as the
sole member of each of the foregoing limited liability companies.
 
               
 
      By:        
 
               
 
          David G. Valiaveedan    
 
          Vice-President — Finance    

[INTERCREDITOR AGREEMENT]

 

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                      K. HOVNANIAN HOMES AT FOREST RUN, L.L.C.

K. HOVNANIAN HOMES AT GREENWAY FARM PARK TOWNS, L.L.C.

K. HOVNANIAN HOMES AT GREENWAY FARM, L.L.C.

K. HOVNANIAN HOMES AT RENAISSANCE PLAZA, L.L.C.

K. HOVNANIAN HOMES AT RUSSETT, L.L.C.

K. HOVNANIAN HOMES OF MARYLAND, L.L.C.

K. HOVNANIAN’S FOUR SEASONS AT KENT ISLAND CONDOMINIUMS, L.L.C.

K. HOVNANIAN’S FOUR SEASONS AT KENT ISLAND, L.L.C.

K. HOVNANIAN’S FOUR SEASONS AT ST. MARGARETS LANDING, L.L.C.

RIDGEMORE UTILITY, L.L.C.

WASHINGTON HOMES AT COLUMBIA TOWN CENTER, L.L.C.

WH/PR LAND COMPANY, L.L.C.

WOODLAND LAKE CONDOMINIUMS AT BOWIE NEW TOWN, L.L.C.
   
 
                    By:   K. Hovnanian Developments of Maryland, Inc., as the
sole member of each of the foregoing limited liability
companies.    
 
               
 
      By:        
 
               
 
          David G. Valiaveedan    
 
          Vice-President — Finance    

[INTERCREDITOR AGREEMENT]

 

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                      ALFORD, L.L.C.

DULLES COPPERMINE, L.L.C.

HOVNANIAN LAND INVESTMENT GROUP OF VIRGINIA, L.L.C.

K. HOVNANIAN AT LAKE RIDGE CROSSING, L.L.C.

K. HOVNANIAN AT LAKE TERRAPIN, L.L.C.

K. HOVNANIAN FOUR SEASONS @ HISTORIC VIRGINIA, L.L.C.

K. HOVNANIAN HOMES AT CAMERON STATION, L.L.C.

K. HOVNANIAN HOMES AT BELMONT OVERLOOK, L.L.C.

K. HOVNANIAN HOMES AT PAYNE STREET, L.L.C.

K. HOVNANIAN HOMES AT VICTORIA STATION, L.L.C.

K. HOVNANIAN SUMMIT HOLDINGS, L.L.C.

K. HOVNANIAN’S FOUR SEASONS AT ASHBURN VILLAGE, L.L.C.

K. HOVNANIAN’S FOUR SEASONS AT CHARLOTTESVILLE, L.L.C.

K. HOVNANIAN’S FOUR SEASONS AT DULLES DISCOVERY CONDOMINIUM, L.L.C.

K. HOVNANIAN’S FOUR SEASONS AT DULLES DISCOVERY, L.L.C.

K. HOVNANIAN’S FOUR SEASONS AT NEW KENT VINEYARDS, L.L.C.

K. HOVNANIAN’S FOUR SEASONS AT VINT HILL, L.L.C.    
 
                    By:   K. Hovnanian Developments of Virginia, Inc., as the
sole member of each of the foregoing limited liability
companies.    
 
               
 
      By:        
 
               
 
          David G. Valiaveedan    
 
          Vice-President — Finance    

[INTERCREDITOR AGREEMENT]

 

--------------------------------------------------------------------------------

 

AUDDIE ENTERPRISES, L.L.C.
BUILDER SERVICES NJ, L.L.C.
HOVNANIAN LAND INVESTMENT GROUP OF NEW JERSEY, L.L.C.
K. HOVNANIAN AT ABERDEEN URBAN RENEWAL, L.L.C.
K. HOVNANIAN AT ALLENDALE, L.L.C.
K. HOVNANIAN AT BARNEGAT I, L.L.C.
K. HOVNANIAN AT BARNEGAT II, L.L.C.
K. HOVNANIAN AT BARNEGAT III, L.L.C.
K. HOVNANIAN AT BERKELEY, L.L.C.
K. HOVNANIAN AT BERNARDS V, L.L.C.
K. HOVNANIAN AT BLUE HERON PINES, L.L.C.
K. HOVNANIAN AT BRIDGEWATER I, L.L.C
K. HOVNANIAN AT CAMDEN I, L.L.C.
K. HOVNANIAN AT CEDAR GROVE III, L.L.C.
K. HOVNANIAN AT CEDAR GROVE IV, L.L.C.
K. HOVNANIAN AT CHESTER I, L.L.C.
K. HOVNANIAN AT CHESTERFIELD, L.L.C.
K. HOVNANIAN AT CHESTERFIELD II, L.L.C.
K. HOVNANIAN AT CLIFTON II, L.L.C.
K. HOVNANIAN AT CLIFTON, L.L.C.
K. HOVNANIAN AT CRANBURY, L.L.C.
K. HOVNANIAN AT CURRIES WOODS, L.L.C.
K. HOVNANIAN AT DENVILLE, L.L.C.
K. HOVNANIAN AT DEPTFORD TOWNSHIP, L.L.C.
K. HOVNANIAN AT DOVER, L.L.C.
K. HOVNANIAN AT EDGEWATER II, L.L.C.
K. HOVNANIAN AT EDGEWATER, L.L.C.
K. HOVNANIAN AT EGG HARBOR TOWNSHIP, L.L.C.
K. HOVNANIAN AT EGG HARBOR TOWNSHIP II, L.L.C.
K. HOVNANIAN AT ELK TOWNSHIP, L.L.C.
K. HOVNANIAN AT FIFTH AVENUE, L.L.C.
K. HOVNANIAN AT FLORENCE I, L.L.C.
K. HOVNANIAN AT FLORENCE II, L.L.C.
[INTERCREDITOR AGREEMENT]

 

--------------------------------------------------------------------------------

 

K. HOVNANIAN AT FOREST MEADOWS, L.L.C.
K. HOVNANIAN AT FRANKLIN, L.L.C.
K. HOVNANIAN AT FREEHOLD TOWNSHIP, L.L.C.
K. HOVNANIAN AT GALLOWAY, L.L.C.
K. HOVNANIAN AT GREAT NOTCH, L.L.C.
K. HOVNANIAN AT GUTTENBERG, L.L.C.
K. HOVNANIAN AT HACKETTSTOWN II, L.L.C.
K. HOVNANIAN AT HAMBURG CONTRACTORS, L.L.C.
K. HOVNANIAN AT HAMBURG, L.L.C.
K. HOVNANIAN AT HAWTHORNE, L.L.C
K. HOVNANIAN AT HAZLET, L.L.C.
K. HOVNANIAN AT HILLTOP, L.L.C.
K. HOVNANIAN AT JACKSON I, L.L.C.
K. HOVNANIAN AT JACKSON, L.L.C.
K. HOVNANIAN AT JERSEY CITY IV, L.L.C.
K. HOVNANIAN AT JERSEY CITY V URBAN RENEWAL COMPANY, L.L.C.
K. HOVNANIAN AT KEYPORT, L.L.C.
K. HOVNANIAN AT LAFAYETTE ESTATES, L.L.C.
K. HOVNANIAN AT LAWRENCE V, L.L.C.
K. HOVNANIAN AT LINWOOD, L.L.C.
K. HOVNANIAN AT LITTLE EGG HARBOR TOWNSHIP II, L.L.C.
K. HOVNANIAN AT LITTLE EGG HARBOR CONTRACTORS, L.L.C.
K. HOVNANIAN AT LITTLE EGG HARBOR, L.L.C.
K. HOVNANIAN AT LITTLE EGG HARBOR III, L.L.C.
K. HOVNANIAN AT LONG BRANCH I, L.L.C.
K. HOVNANIAN AT MANALAPAN III, L.L.C.
K. HOVNANIAN AT MANSFIELD I, L.L.C.
K. HOVNANIAN AT MANSFIELD II, L.L.C.
K. HOVNANIAN AT MANSFIELD III, L.L.C.
K. HOVNANIAN AT MAPLE AVENUE, L.L.C.
K. HOVNANIAN AT MARLBORO TOWNSHIP IX, L.L.C.
K. HOVNANIAN AT MARLBORO TOWNSHIP V, L.L.C.
K. HOVNANIAN AT MARLBORO TOWNSHIP VIII, L.L.C.
[INTERCREDITOR AGREEMENT]

 

--------------------------------------------------------------------------------

 

K. HOVNANIAN AT MARLBORO VI, L.L.C.
K. HOVNANIAN AT MARLBORO VII, L.L.C.
K. HOVNANIAN AT MENDHAM TOWNSHIP, L.L.C.
K. HOVNANIAN AT MIDDLE TOWNSHIP, L.L.C.
K. HOVNANIAN AT MIDDLE TOWNSHIP II, L.L.C.
K. HOVNANIAN AT MIDDLETOWN II, L.L.C.
K. HOVNANIAN AT MIDDLETOWN, L.L.C.
K. HOVNANIAN AT MILLVILLE I, L.L.C.
K. HOVNANIAN AT MILLVILLE II, L.L.C.
K. HOVNANIAN AT MILLVILLE III, L.L.C.
K. HOVNANIAN AT MONROE III, L.L.C.
K. HOVNANIAN AT MONROE IV, L.L.C.
K. HOVNANIAN AT MONROE NJ, L.L.C.
K. HOVNANIAN AT MONTVALE, L.L.C.
K. HOVNANIAN AT MT. OLIVE TOWNSHIP, L.L.C.
K. HOVNANIAN AT NEW BRUNSWICK URBAN RENEWAL, L.L.C.
K. HOVNANIAN AT NORTH BERGEN, L.L.C.
K. HOVNANIAN AT NORTH BRUNSWICK VI, L.L.C.
K. HOVNANIAN AT NORTH CALDWELL II, L.L.C.
K. HOVNANIAN AT NORTH CALDWELL III, L.L.C.
K. HOVNANIAN AT NORTH CALDWELL, L.L.C.
K. HOVNANIAN AT NORTH HALEDON, L.L.C.
K. HOVNANIAN AT NORTH WILDWOOD, L.L.C.
K. HOVNANIAN AT NORTHFIELD, L.L.C.
K. HOVNANIAN AT OCEANPORT, L.L.C.
K. HOVNANIAN AT OLD BRIDGE, L.L.C.
K. HOVNANIAN AT PARAMUS, L.L.C.
K. HOVNANIAN AT PARSIPPANY-TROY HILLS, L.L.C.
K. HOVNANIAN AT PEAPACK-GLADSTONE, L.L.C.
K. HOVNANIAN AT PITTSGROVE, L.L.C.
K. HOVNANIAN AT PORT IMPERIAL URBAN RENEWAL IV, L.L.C.
K. HOVNANIAN AT PORT IMPERIAL URBAN RENEWAL V, L.L.C.
[INTERCREDITOR AGREEMENT]

 

--------------------------------------------------------------------------------

 

K. HOVNANIAN AT PORT IMPERIAL URBAN RENEWAL VI, L.L.C.
K. HOVNANIAN AT PORT IMPERIAL URBAN RENEWAL VII, L.L.C.
K. HOVNANIAN AT PORT IMPERIAL URBAN RENEWAL VIII, L.L.C.
K. HOVNANIAN AT PRINCETON LANDING, L.L.C.
K. HOVNANIAN AT PRINCETON NJ, L.L.C.
K. HOVNANIAN AT RANDOLPH I, L.L.C.
K. HOVNANIAN AT READINGTON II, L.L.C.
K. HOVNANIAN AT RED BANK, L.L.C.
K. HOVNANIAN AT RIDGEMONT, L.L.C.
K. HOVNANIAN AT SAYREVILLE, L.L.C.
K. HOVNANIAN AT SCOTCH PLAINS, L.L.C.
K. HOVNANIAN AT SMITHVILLE III, L.L.C.
K. HOVNANIAN AT SOMERS POINT, L.L.C.
K. HOVNANIAN AT SOUTH BRUNSWICK, L.L.C.
K. HOVNANIAN AT SPARTA, L.L.C.
K. HOVNANIAN AT SPRINGCO, L.L.C.
K. HOVNANIAN AT TEANECK, L.L.C.
K. HOVNANIAN AT THE MONARCH, L.L.C.
K. HOVNANIAN AT TRENTON, L.L.C.
K. HOVNANIAN AT UNION TOWNSHIP II, L.L.C.
K. HOVNANIAN AT UPPER FREEHOLD TOWNSHIP II, L.L.C.
K. HOVNANIAN AT UPPER FREEHOLD TOWNSHIP III, L.L.C.
K. HOVNANIAN AT VERONA URBAN RENEWAL, L.L.C.
K. HOVNANIAN AT VINELAND, L.L.C.
K. HOVNANIAN AT WANAQUE, L.L.C.
K. HOVNANIAN AT WARREN TOWNSHIP, L.L.C.
K. HOVNANIAN AT WASHINGTON, L.L.C.
K. HOVNANIAN AT WAYNE IX, L.L.C.
K. HOVNANIAN AT WAYNE VIII, L.L.C.
K. HOVNANIAN AT WEST MILFORD, L.L.C.
K. HOVNANIAN AT WEST WINDSOR, L.L.C.
[INTERCREDITOR AGREEMENT]

 

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K. HOVNANIAN AT WILDWOOD BAYSIDE, L.L.C.
K. HOVNANIAN AT WOODHILL ESTATES, L.L.C.
K. HOVNANIAN AT WOOLWICH I, L.L.C.
K. HOVNANIAN CENTRAL ACQUISITIONS, L.L.C.
K. HOVNANIAN CHESTERFIELD INVESTMENT, L.L.C.
K. HOVNANIAN CLASSICS, L.L.C.
K. HOVNANIAN CLASSICS CIP, L.L.C.
K. HOVNANIAN HOMES – DFW, L.L.C.
K. HOVNANIAN HOMES OF HOUSTON, L.L.C.
K. HOVNANIAN OF HOUSTON II, L.L.C.
K. HOVNANIAN NORTH CENTRAL ACQUISITIONS, L.L.C.
K. HOVNANIAN NORTH JERSEY ACQUISITIONS, L.L.C.
K. HOVNANIAN NORTHEAST SERVICES, L.L.C.
K. HOVNANIAN SHORE ACQUISITIONS, L.L.C.
K. HOVNANIAN SOUTHERN NEW JERSEY, L.LC.
K. HOVNANIAN SOUTH JERSEY ACQUISITIONS, L.L.C.
K. HOVNANIAN T&C INVESTMENT, L.L.C.
K. HOVNANIAN VENTURE I, L.L.C.
K. HOVNANIAN’S PRIVATE HOME PORTFOLIO, L.L.C.
TERRAPIN REALTY, L.L.C.
KHIP, L.L.C.

                          By:   K. Hovnanian Holdings NJ, L.L.C., as the sole
member of each of the foregoing limited liability companies.    
 
                            By:   K. Hovnanian Developments of New Jersey, Inc.,
as member    
 
                   
 
          By:        
 
             
 
David G. Valiaveedan    
 
              Vice-President — Finance    
 
                   
 
              AND    
 
                            By:   K. Hovnanian Developments of New Jersey II,
Inc., as member    
 
                   
 
          By:        
 
             
 
David G. Valiaveedan    
 
              Vice-President – Finance    

[INTERCREDITOR AGREEMENT]

 

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                          F&W MECHANICAL SERVICES, L.L.C.    
 
                        By:   K. Hovnanian Holdings NJ, L.L.C., as the managing
member of the foregoing limited liability company.    
 
                            By:   K. Hovnanian Developments of New Jersey, Inc.,
as member    
 
                   
 
          By:        
 
             
 
David G. Valiaveedan    
 
              Vice-President — Finance    
 
                   
 
              AND    
 
                            By:   K. Hovnanian Developments of New Jersey II,
Inc., as member    
 
                   
 
          By:        
 
             
 
David G. Valiaveedan    
 
              Vice-President – Finance    

[INTERCREDITOR AGREEMENT]

 

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                          K. HOVNANIAN AT HUDSON POINTE, L.L.C.    
 
                        By:   K. Hovnanian Holdings NJ, L.L.C., its sole member
   
 
                            By:   K. Hovnanian Developments of New Jersey, Inc.,
as member    
 
                   
 
          By:        
 
             
 
David G. Valiaveedan    
 
              Vice-President — Finance    
 
                   
 
              AND    
 
                            By:   K. Hovnanian Developments of New Jersey II,
Inc., as member    
 
                   
 
          By:        
 
             
 
David G. Valiaveedan    
 
              Vice-President — Finance    

[INTERCREDITOR AGREEMENT]

 

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                              PARK TITLE COMPANY, L.L.C.    
 
                            By:   K. Hovnanian of Houston II, L.L.C., its sole
member    
 
                                By:   K. Hovnanian Holdings NJ, L.L.C., its sole
member    
 
                                    By:   K. Hovnanian Developments of New
Jersey, Inc., as member    
 
                       
 
              By:        
 
                 
 
David G. Valiaveedan    
 
                  Vice-President — Finance    
 
                       
 
                  AND    
 
                                    By:   K. Hovnanian Developments of New
Jersey II, Inc., as member    
 
                       
 
              By:        
 
                 
 
David G. Valiaveedan    
 
                  Vice-President — Finance    

[INTERCREDITOR AGREEMENT]

 

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HOVNANIAN LAND INVESTMENT GROUP OF CALIFORNIA, L.L.C.
K.H. SAN MARCOS CONSERVANCY HOLDINGS, L.L.C.
K. HOVNANIAN AT 3 CHAPMAN, L.L.C.
K. HOVNANIAN AT 4S, L.L.C.
K. HOVNANIAN AT ACQUA VISTA, L.L.C.
K. HOVNANIAN AT ALISO, L.L.C.
K. HOVNANIAN AT ARBOR HEIGHTS, L.L.C.
K. HOVNANIAN AT AVENUE ONE, L.L.C.
K. HOVNANIAN AT BELLA LAGO, L.L.C.
K. HOVNANIAN AT BRIDLEWOOD, L.L.C.
K. HOVNANIAN AT CAPISTRANO, L.L.C.
K. HOVNANIAN AT CARMEL VILLAGE, L.L.C.
K. HOVNANIAN AT CIELO, L.L.C.
K. HOVNANIAN AT COASTLINE, L.L.C.
K. HOVNANIAN AT CORTEZ HILL, L.L.C.
K. HOVNANIAN AT EASTLAKE, L.L.C.
K. HOVNANIAN AT ENCINITAS RANCH, L.L.C.
K. HOVNANIAN AT EVERGREEN, L.L.C.
K. HOVNANIAN AT GASLAMP SQUARE, L.L.C.
K. HOVNANIAN AT HIGHWATER, L.L.C.
K. HOVNANIAN AT LA COSTA, LLC
K. HOVNANIAN AT LA COSTA GREENS, L.L.C.
K. HOVNANIAN AT LA HABRA KNOLLS, L.L.C.
K. HOVNANIAN AT LAKE HILLS, L.L.C.
K. HOVNANIAN AT LAKE RANCHO VIEJO, L.L.C.
K. HOVNANIAN AT MATSU, L.L.C.
K. HOVNANIAN AT MENIFEE, L.L.C.
K. HOVNANIAN AT MOCKINGBIRD CANYON, L.L.C.
K. HOVNANIAN AT MOSAIC, L.L.C.
K. HOVNANIAN AT OLDE ORCHARD, L.L.C.
K. HOVNANIAN AT ORANGE HEIGHTS, L.L.C.
K. HOVNANIAN AT PACIFIC BLUFFS, L.L.C.
K. HOVNANIAN AT PARK LANE, L.L.C.
K. HOVNANIAN AT PIAZZA D’ORO, L.L.C.
[INTERCREDITOR AGREEMENT]

 

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K. HOVNANIAN AT PRADO, L.L.C.
K. HOVNANIAN AT RANCHO SANTA MARGARITA, L.L.C.
K. HOVNANIAN AT RIVERBEND, L.L.C.
K. HOVNANIAN AT ROSEMARY LANTANA, L.L.C.
K. HOVNANIAN AT ROWLAND HEIGHTS, L.L.C.
K. HOVNANIAN AT SAGE, L.L.C.
K. HOVNANIAN AT SKYE ISLE, L.L.C.
K. HOVNANIAN AT SUNSETS, L.L.C.
K. HOVNANIAN AT THE CROSBY, L.L.C.
K. HOVNANIAN AT THE GABLES, L.L.C.
K. HOVNANIAN AT THE PRESERVE, L.L.C.
K. HOVNANIAN AT THOMPSON RANCH, L.L.C.
K. HOVNANIAN AT TRAIL RIDGE, L.L.C.
K. HOVNANIAN AT WINCHESTER, L.L.C.
K. HOVNANIAN INTERNATIONAL, L.L.C.
K. HOVNANIAN T&C MANAGEMENT CO., L.L.C.
K. HOVNANIAN’S FOUR SEASONS AT BAKERSFIELD, L.L.C.
K. HOVNANIAN’S FOUR SEASONS AT BEAUMONT, L.L.C.
K. HOVNANIAN’S FOUR SEASONS AT HEMET, L.L.C.
K. HOVNANIAN’S FOUR SEASONS AT MENIFEE VALLEY, L.L.C.
K. HOVNANIAN’S FOUR SEASONS AT PALM SPRINGS, L.L.C.
K. HOVNANIAN’S FOUR SEASONS, L.L.C.
K. HOVNANIAN’S PARKSIDE AT TOWNGATE, L.L.C.
NATOMAS CENTRAL NEIGHBORHOOD HOUSING, L.L.C.

                      By:   K. Hovnanian Developments of California, Inc., as
the sole member of each of the foregoing limited liability companies.
 
               
 
      By:        
 
         
 
David G. Valiaveedan    
 
          Vice-President — Finance    

[INTERCREDITOR AGREEMENT]

 

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                      K. HOVNANIAN HOLDINGS NJ, L.L.C.    
 
                    By:   K. Hovnanian Developments of New Jersey, Inc., as
member of the foregoing limited liability company.    
 
               
 
      By:        
 
         
 
David G. Valiaveedan    
 
          Vice-President — Finance    
 
               
 
          AND    
 
                    By:   K. Hovnanian Developments of New Jersey II, Inc., as
member of the foregoing limited liability company.    
 
               
 
      By:        
 
         
 
David G. Valiaveedan    
 
          Vice-President — Finance    

[INTERCREDITOR AGREEMENT]

 

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BUILDER SERVICES, PA, L.L.C.
HOVNANIAN LAND INVESTMENT GROUP OF PENNSYLVANIA, L.L.C.
K. HOVNANIAN AT ALLENBERRY, L.L.C.
K. HOVNANIAN AT ALLENTOWN, L.L.C.
K. HOVNANIAN AT BROAD AND WALNUT, L.L.C.
K. HOVNANIAN AT CAMP HILL, L.L.C.
K HOVNANIAN AT EAST BRANDYWINE, L.L.C.
K HOVNANIAN AT FORKS TWP. I, L.L.C.
K. HOVNANIAN AT LOWER MACUNGIE TOWNSHIP I, L.L.C.
K. HOVNANIAN AT LOWER MACUNGIE TOWNSHIP II, L.L.C.
K. HOVNANIAN AT LOWER MAKEFIELD TOWNSHIP I, L.L.C.
K. HOVNANIAN AT LOWER MORELAND I, L.L.C.
K. HOVNANIAN AT LOWER MORELAND II, L.L.C.
K. HOVNANIAN AT LOWER MORELAND III, L.L.C.
K. HOVNANIAN AT MACUNGIE, L.L.C.
K. HOVNANIAN AT NORTHAMPTON, L.L.C.
K. HOVNANIAN AT PHILADELPHIA II, L.L.C.
K. HOVNANIAN AT PHILADELPHIA III, L.L.C.
K. HOVNANIAN AT PHILADELPHIA IV, L.L.C.
K. HOVNANIAN AT RAPHO, L.L.C.

                      By:   K. Hovnanian Companies of Pennsylvania, Inc., as the
sole member of each of the foregoing limited liability companies.
 
               
 
      By:        
 
         
 
David G. Valiaveedan    
 
          Vice-President — Finance    

[INTERCREDITOR AGREEMENT]

 

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K. HOVNANIAN AT SILVER SPRING, L.L.C.
K. HOVNANIAN AT UPPER UWCHLAN II, L.L.C.
K. HOVNANIAN AT UPPER UWCHLAN, L.L.C.
K. HOVNANIAN AT WEST BRADFORD, L.L.C.
K. HOVNANIAN HOMES OF PENNSYLVANIA, L.L.C.
K. HOVNANIAN PENNSYLVANIA ACQUISITIONS, L.L.C.
K. HOVNANIAN SUMMIT HOMES OF PENNSYLVANIA, L.L.C.
MIDWEST BUILDING PRODUCTS & CONTRACTOR SERVICES OF PENNSYLVANIA, L.L.C.
RIDGEMORE UTILITY ASSOCIATES OF PENNSYLVANIA, L.L.C.

                      By:   K. Hovnanian Companies of Pennsylvania, Inc., as the
sole member of each of the foregoing limited liability companies.
 
               
 
      By:        
 
         
 
David G. Valiaveedan    
 
          Vice-President — Finance    

[INTERCREDITOR AGREEMENT]

 

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HOVNANIAN LAND INVESTMENT GROUP OF FLORIDA, L.L.C.
K. HOVNANIAN CAMBRIDGE HOMES, L.L.C.
K. HOVNANIAN FIRST HOMES, L.L.C.
K. HOVNANIAN FLORIDA REALTY, L.L.C.
K. HOVNANIAN STANDING ENTITY, L.L.C.
K. HOVNANIAN T&C HOMES AT FLORIDA, L.L.C.
K. HOVNANIAN WINDWARD HOMES, L.L.C.

                      By:   Hovnanian Developments of Florida, Inc., as the sole
member of each of the foregoing limited liability companies.    
 
               
 
      By:        
 
         
 
David G. Valiaveedan    
 
          Vice-President — Finance    

[INTERCREDITOR AGREEMENT]

 

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                      K. HOVNANIAN COMPANIES, LLC    
 
                    By:   K. Hovnanian Enterprises, Inc., as member of the
foregoing limited liability company.
 
               
 
      By:        
 
         
 
David G. Valiaveedan    
 
          Vice-President — Finance    
 
               
 
          AND    
 
                    By:   K. Hovnanian Developments of New Jersey II, Inc., as
member of the foregoing limited liability company.    
 
               
 
      By:        
 
         
 
David G. Valiaveedan    
 
          Vice-President — Finance    
 
                    K. HOVNANIAN EASTERN PENNSYLVANIA, L.L.C.    
 
                    By:   K. Hovnanian at Perkiomen II, Inc., as the sole member
of the foregoing limited liability company.
 
               
 
      By:        
 
         
 
David G. Valiaveedan    
 
          Vice-President — Finance    

[INTERCREDITOR AGREEMENT]

 

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K. HOVNANIAN CRAFTBUILT HOMES OF SOUTH CAROLINA, L.L.C.
K. HOVNANIAN FOUR SEASONS AT GOLD HILL, L.L.C.
K. HOVNANIAN HOMES OF SOUTH CAROLINA, L.L.C.

                      By:   K. Hovnanian Developments of South Carolina, Inc.,
as the sole member of each of the foregoing limited liability companies.
 
               
 
      By:        
 
         
 
David G. Valiaveedan    
 
          Vice-President — Finance    

K. HOVNANIAN GREAT WESTERN BUILDING COMPANY, L.L.C.
K. HOVNANIAN GREAT WESTERN HOMES, L.L.C.
NEW LAND TITLE AGENCY, L.L.C.

                      By:   K. Hovnanian Developments of Arizona, Inc., as the
sole member of each of the foregoing limited liability companies.
 
               
 
      By:        
 
         
 
David G. Valiaveedan    
 
          Vice-President — Finance    

[INTERCREDITOR AGREEMENT]

 

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K. HOVNANIAN AT HIGHLAND SHORES, L.L.C.
K. HOVNANIAN AT RIDGESTONE, L.L.C.
K. HOVNANIAN HOMES OF MINNESOTA, L.L.C.
K. HOVNANIAN’S FOUR SEASONS AT RUSH CREEK, L.L.C.
K. HOVNANIAN T&C HOMES AT MINNESOTA, L.L.C.

                      By:   K. Hovnanian Developments of Minnesota, Inc., as the
sole member of each of the foregoing limited liability companies.
 
               
 
      By:        
 
         
 
David G. Valiaveedan    
 
          Vice-President — Finance    

[INTERCREDITOR AGREEMENT]

 

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K. HOVNANIAN OHIO REALTY, L.L.C.
K. HOVNANIAN OSTER HOMES, L.L.C.
K. HOVNANIAN SUMMIT HOMES, L.L.C.
MIDWEST BUILDING PRODUCTS & CONTRACTOR SERVICES, L.L.C.

                      By:   K. Hovnanian Developments of Ohio, Inc., as the sole
member of each of the foregoing limited liability companies.    
 
               
 
      By:        
 
         
 
David G. Valiaveedan    
 
          Vice-President — Finance    

[INTERCREDITOR AGREEMENT]

 

--------------------------------------------------------------------------------

 

K. HOVNANIAN HOMES OF WEST VIRGINIA, L.L.C.
K. HOVNANIAN’S FOUR SEASONS AT HUNTFIELD, L.L.C.
K. HOVNANIAN SUMMIT HOMES OF WEST VIRGINIA, L.L.C.
MIDWEST BUILDING PRODUCTS & CONTRACTOR SERVICES OF
WEST VIRGINIA, L.L.C.

                      By:   K. Hovnanian Developments of West Virginia, Inc., as
the sole member of each of the foregoing limited liability companies.
 
               
 
      By:        
 
         
 
David G. Valiaveedan    
 
          Vice-President — Finance    

K. HOVNANIAN SUMMIT HOMES OF MICHIGAN, L.L.C.
MIDWEST BUILDING PRODUCTS & CONTRACTOR SERVICES OF MICHIGAN, L.L.C.

                      By:   K. Hovnanian Developments of Michigan, Inc., as the
sole member of the foregoing limited liability company.
 
               
 
      By:        
 
         
 
David G. Valiaveedan    
 
          Vice-President — Finance    

[INTERCREDITOR AGREEMENT]

 

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M&M AT CHESTERFIELD, L.L.C.
M&M AT APPLE RIDGE, L.L.C.
M&M AT EAST MILL, L.L.C.
M&M AT MORRISTOWN, L.L.C.
M&M AT SHERIDAN, L.L.C.
M&M AT SPINNAKER POINTE, L.L.C.
M&M AT SPRUCE HOLLOW, L.L.C.
M&M AT SPRUCE RUN, L.L.C.
M&M AT THE HIGHLANDS, L.L.C.
MATZEL & MUMFORD AT EGG HARBOR, L.L.C.
MATZEL & MUMFORD AT MONTGOMERY, L.L.C.
THE LANDINGS AT SPINNAKER POINTE, L.L.C.

                      By:   The Matzel & Mumford Organization, Inc., as the sole
member of each of the foregoing limited liability companies.
 
               
 
      By:        
 
         
 
David G. Valiaveedan    
 
          Vice-President — Finance    

[INTERCREDITOR AGREEMENT]

 

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M & M AT COPPER BEECH, L.L.C.
M & M AT CRESCENT COURT, L.L.C.
M&M AT EAST RUTHERFORD, L.L.C.
M&M AT KENSINGTON WOODS, L.L.C.
M & M AT STATION SQUARE, L.L.C.
M & M AT UNION, L.L.C.
M&M AT TAMARACK HOLLOW, L.L.C.
M&M AT THE CHATEAU, L.LC.
M&M AT WEST ORANGE, L.L.C.
M&M AT WESTPORT, L.L.C.
M&M AT WHEATENA URBAN RENEWAL, L.L.C.
MATZEL & MUMFORD AT SOUTH BOUND BROOK URBAN RENEWAL, L.L.C.
MMIP, L.L.C.

                      By:   M&M Investments, L.P., as the sole member of each of
the foregoing limited liability companies.    
 
               
 
      By:        
 
         
 
David G. Valiaveedan    
 
          Vice-President — Finance    

[INTERCREDITOR AGREEMENT]

 

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K. HOVNANIAN HOMES AT FAIRWOOD, L.L.C.
K. HOVNANIAN HOMES AT JONES STATION 1, L.L.C.
K. HOVNANIAN HOMES AT JONES STATION 2, L.L.C.
K. HOVNANIAN HOMES AT MAXWELL PLACE. L.L.C.
K. HOVNANIAN HOMES AT PRIMERA, L.L.C.
PADDOCKS, L.L.C.
PINE AYR, L.L.C.

                          By:   K. Hovnanian Homes of Maryland, L.L.C., as the
sole member of each of the foregoing limited liability companies.    
 
                   
 
      By:                                           David G. Valiaveedan
Vice-President — Finance    

HOVNANIAN LAND INVESTMENT GROUP OF TEXAS, L.L.C.

                          By:   K. Hovnanian Homes — DFW, L.L.C., as the sole
member of the foregoing limited liability company.    
 
                   
 
      By:   K. Hovn member company   anian Holdings NJ, L.L.C., as the sole of
the foregoing limited liability         .    
 
                   
 
          By:        
 
             
 
David G. Valiaveedan    
 
              Vice-President — Finance    

[INTERCREDITOR AGREEMENT]

 

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K. HOVNANIAN AT NEW WINDSOR, L.L.C.
BUILDER SERVICES NY, L.L.C.
K. HOVNANIAN’S FOUR SEASONS AT HAMPTONBURGH, L.L.C.

                      By:   K. Hovnanian at Northern Westchester, Inc., as the
sole member of each of the foregoing limited liability companies.    
 
               
 
      By:        
 
         
 
David G. Valiaveedan    
 
          Vice-President — Finance    

K. HOVNANIAN DELAWARE ACQUISITIONS, L.L.C.
K. HOVNANIAN HOMES OF DELAWARE, L.L.C.
K. HOVNANIAN HOMES AT NASSAU GROVE, L.L.C.

                      By:   K. Hovnanian Developments of Delaware, Inc., as the
sole member of the foregoing limited liability company.
 
               
 
      By:        
 
         
 
David G. Valiaveedan    
 
          Vice-President — Finance    

[INTERCREDITOR AGREEMENT]

 

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K. HOVNANIAN AT MENIFEE VALLEY CONDOMINIUMS, L.L.C.

                      By:   K. Hovnanian’s Four Seasons At Menifee Valley,
L.L.C.    
 
               
 
      By:        
 
         
 
David G. Valiaveedan    
 
          Vice-President — Finance    

HOVNANIAN LAND INVESTMENT GROUP OF NORTH CAROLINA, L.L.C.

                      By:   K. Hovnanian Developments of North Carolina, Inc.,
as the sole member of the foregoing limited liability company.    
 
               
 
      By:        
 
         
 
David G. Valiaveedan    
 
          Vice-President — Finance    

[INTERCREDITOR AGREEMENT]

 

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K. HOVNANIAN’S FOUR SEASONS AT BAILEY’S GLENN, L.L.C.
K. HOVNANIAN’S FOUR SEASONS AT RENAISSANCE, L.L.C.

                      By:   K. Hovnanian Homes of North Carolina, Inc. as the
sole member of the foregoing limited liability companies    
 
               
 
      By:        
 
         
 
David G. Valiaveedan    
 
          Vice-President — Finance    

[INTERCREDITOR AGREEMENT]

 

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K. HOVNANIAN HOMES OF INDIANA, L.L.C.

                      By:   K. Hovnanian Developments of Indiana, Inc., as the
sole member of the foregoing limited liability company.    
 
               
 
      By:        
 
         
 
David G. Valiaveedan    
 
          Vice-President — Finance    

K. HOVNANIAN SUMMIT HOMES OF KENTUCKY, L.L.C.
MIDWEST BUILDING PRODUCTS & CONTRACTOR SERVICES OF KENTUCKY, L.L.C.

                      By:   K. Hovnanian Developments of Kentucky, Inc., as the
sole member of the foregoing limited liability companies.    
 
               
 
      By:        
 
         
 
David G. Valiaveedan    
 
          Vice-President — Finance    

[INTERCREDITOR AGREEMENT]

 

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K. HOVNANIAN CONNECTICUT ACQUISITIONS, L.L.C.

                      By:   K. Hovnanian Developments of Connecticut, Inc., as
the sole member of the foregoing limited liability company.    
 
               
 
      By:        
 
         
 
David G. Valiaveedan    
 
          Vice-President — Finance    

K. HOVNANIAN T&C HOMES AT ILLINOIS, L.L.C.

                      By:   K. Hovnanian Developments of Illinois, Inc., as the
sole member of the foregoing limited liability company.    
 
               
 
      By:        
 
         
 
David G. Valiaveedan    
 
          Vice-President — Finance    

HOVNANIAN LAND INVESTMENT GROUP OF GEORGIA, L.L.C
K. HOVNANIAN HOMES OF GEORGIA, L.L.C.

                      By:   K. Hovnanian Developments of Georgia, Inc., as the
sole member of each of the foregoing limited liability companies.    
 
               
 
      By:        
 
         
 
David G. Valiaveedan    
 
          Vice-President — Finance    

[INTERCREDITOR AGREEMENT]

 

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WESTMINSTER HOMES OF ALABAMA, L.L.C.
WESTMINSTER HOMES OF MISSISSIPPI, L.L.C.

                      By:   Washington Homes, Inc., as sole member of each of
the foregoing limited liability companies.    
 
               
 
      By:        
 
         
 
David G. Valiaveedan    
 
          Vice-President — Finance    

K. HOVNANIAN AT EWING, L.L.C.

                      By:   K. Hovnanian at Lakewood, Inc., as sole member of
the foregoing limited liability company    
 
               
 
      By:        
 
         
 
David G. Valiaveedan    
 
          Vice-President — Finance    

[INTERCREDITOR AGREEMENT]

 

--------------------------------------------------------------------------------

 

M&M INVESTMENTS, L.P.

                      By:   The Matzel & Mumford Organization, Inc., as general
partner of the foregoing limited partnership.    
 
               
 
      By:        
 
         
 
David G. Valiaveedan    
 
          Vice-President — Finance    

Address for Notices for each of the foregoing:
c/o K. Hovnanian Enterprises, Inc.
110 West Front St., P.O. Box 500
Red Bank, NJ 07701
Attention: David G. Valiaveedan
Telephone: (732) 747-7800
Telecopy: (732) 747-6835
[INTERCREDITOR AGREEMENT]

 

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Exhibit A
Form of Joinder Agreement
This JOINDER AGREEMENT is made [          ], 20[  ] by [          ] as
Additional Junior Noteholder Collateral Agent and [          ] as Additional
Junior Trustee.
Reference is made to the Intercreditor Agreement, dated November [  ], 2008,
among each of the Grantors, Hovnanian, the Company, the First-Lien
Administration Agent, the Senior Credit Agent, Wilmington Trust Company, as
Mortgage Tax Collateral Agent, the Senior Noteholder Collateral Agent, the
Senior Trustee, the Initial Junior Noteholder Collateral Agent and the Initial
Junior Trustee (as the same may be modified, supplemented, amended or restated,
the “Intercreditor Agreement”). Capitalized terms used but not otherwise defined
herein shall have the meaning set forth in the Intercreditor Agreement.
This Joinder Agreement is being executed and delivered in connection with the
issuance of Additional Junior Notes denominated as the [  ]% Senior Secured
Notes due [     ] (the “Notes”). Each of the Additional Junior Noteholder
Collateral Agent and the Additional Junior Trustee hereby agrees that effective
as of the date hereof it hereby is, and shall be deemed to be, an Additional
Junior Noteholder Collateral Agent and an Additional Junior Trustee,
respectively, under the Intercreditor Agreement and agrees that from the date
hereof until the Discharge of Senior Claims, it shall perform, comply with and
be subject to and bound by each of the terms, provisions and conditions of the
Intercreditor Agreement with all attendant rights, duties and obligations stated
therein, with the same force and effect as if originally named, in the case of
[  ], as an Additional Junior Noteholder Collateral Agent, and in the case of
[          ], as an Additional Junior Trustee, therein and as if such party
executed the Intercreditor Agreement on November [     ], 2008.
The Additional Junior Noteholder Collateral Agent and the Additional Junior
Trustee hereby makes, affirms, and ratifies the Intercreditor Agreement.
It is understood and agreed that [          ] is entering into this Joinder
Agreement in its capacity as Additional Junior Trustee and the provisions of
[Article 7] of the Additional Junior Indenture applicable to the Additional
Junior Trustee thereunder shall also apply to the Additional Junior Trustee
under this Joinder Agreement and under the Intercreditor Agreement.
This Joinder Agreement has been delivered and accepted at and shall be deemed to
have been made at New York, New York and shall be interpreted, and the rights
and liabilities of the parties bound hereby determined, in accordance with the
laws of the State of New York.
This Joinder Agreement may be signed in any number of counterparts each of which
shall be an original, but all of which together shall constitute one and the
same instrument; and, delivery of executed signature pages hereof by telecopy
transmission, or other electronic transmission in .pdf or similar format, from
one party to another shall constitute effective and binding execution and
delivery of this Joinder Agreement by such party.

 

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IN WITNESS WHEREOF, the Additional Junior Noteholder Collateral Agent and the
Additional Junior Trustee have duly executed this Joinder Agreement as of the
date and year first written above.

              Notice Address:   Additional Junior Noteholder Collateral Agent  
 
 
           
 
  By:        
 
     
 
   
 
           
 
  Title:        
 
     
 
   
 
            Notice Address:   Additional Junior Trustee    
 
           
 
  By:        
 
     
 
   
 
           
 
  Title: