<PAGE>   1
                                                    PARTNERSHIP EXHIBIT 10.5b


                                    AGREEMENT


                             DATED 30th March, 2001


                           pound sterling 100,000,000


                                 CREDIT FACILITY


                                       FOR


                         FAIRCLOUGH HOMES GROUP LIMITED


                                   ARRANGED BY


                         THE ROYAL BANK OF SCOTLAND PLC













                                  Allen & Overy
                                     London
                                    newchange
                                   BK:837223.5



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                                      INDEX

CLAUSE                                                                      PAGE

1.       Interpretation........................................................1
2.       Facility.............................................................16
3.       Purpose..............................................................16
4.       Conditions precedent.................................................16
5.       Utilisation..........................................................17
6.       Repayment............................................................18
7.       Prepayment and Cancellation..........................................18
8.       Interest.............................................................21
9.       Terms................................................................22
10.      Market disruption....................................................22
11.      Taxes................................................................23
12.      Increased Costs......................................................26
13.      Mitigation...........................................................27
14.      Payments.............................................................27
15.      Guarantee and indemnity..............................................29
16.      Representations......................................................32
17.      Information covenants................................................35
18.      Financial covenants..................................................37
19.      General covenants....................................................42
20.      Default..............................................................45
21.      Security.............................................................49
22.      The Administrative Parties...........................................51
23.      Evidence and calculations............................................56
24.      Fees.................................................................56
25.      Indemnities and Break Costs..........................................56
26.      Expenses.............................................................58
27.      Amendments and waivers...............................................58
28.      Changes to the Parties...............................................60
29.      Disclosure of information............................................63
30.      Set-off..............................................................64
31.      Pro rata sharing.....................................................64
32.      Severability.........................................................65
33.      Counterparts.........................................................66
34.      Notices..............................................................66
35.      Language.............................................................67
36.      Governing law........................................................68
37.      Enforcement..........................................................68


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SCHEDULES

1        Original Parties.....................................................69
2        Conditions precedent documents.......................................70
3        Form of Request......................................................74
4        Calculation of the Mandatory Cost....................................75
5        Form of Transfer Certificate.........................................78
6        Existing Security....................................................79
7        Form of Compliance Certificate.......................................82
8        Form of Accession Agreement..........................................84
9        Form of Resignation Request..........................................85
10       Form of Security Agreement...........................................86
11       Form of legal opinion of Allen & Overy..............................111
SIGNATORIES..................................................................116



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THIS AGREEMENT is dated 30th March, 2001

BETWEEN:

(1)      FAIRCLOUGH HOMES GROUP LIMITED (registered number 2804113) (the
         "COMPANY");

(2)      THE SUBSIDIARIES OF THE COMPANY listed in Schedule 1 (Original Parties)
         as original borrowers (in this capacity the "ORIGINAL BORROWERS");

(3)      THE SUBSIDIARIES OF THE COMPANY listed in Schedule 1 (Original Parties)
         as original guarantors (in this capacity the "ORIGINAL GUARANTORS");

(4)      THE ROYAL BANK OF SCOTLAND PLC as arranger (in this capacity the
         "ARRANGER");

(5)      NATIONAL WESTMINSTER BANK PLC as original lender (the "ORIGINAL
         LENDER"); and

(6)      THE ROYAL BANK OF SCOTLAND PLC as facility agent (in this capacity the
         "FACILITY AGENT").

IT IS AGREED as follows:

1.       INTERPRETATION

1.1      DEFINITIONS

         In this Agreement:

         "ACCESSION AGREEMENT"

         means a letter, substantially in the form of Schedule 8 (Form of
         Accession Agreement), with such amendments as the Facility Agent may
         approve or reasonably require.

         "ADDITIONAL BORROWER"

         means a member of the Group which becomes a Borrower after the date of
         this Agreement.

         "ADDITIONAL GUARANTOR"

         means a member of the Group which becomes a Guarantor after the date of
         this Agreement.

         "ADDITIONAL OBLIGOR"

         means an Additional Borrower or an Additional Guarantor.

         "ADJUSTED SECURITY ASSET VALUE"

         means, at any time (without double counting), the aggregate of:

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                                       2


         (a)      50 per cent. of the Value (after deducting, in the case of any
                  Category 1 Land or Category 2 Land which is subject to a
                  Security Interest (other than a Security Interest created by a
                  Security Document), the principal amount secured by that
                  Security Interest) of Category 1 Land and Category 2 Land of
                  the Obligors;

         (b)      60 per cent. of the Value of Work in Progress of the Obligors;
                  and

         (c)      75 per cent. of the Value of Finished Housing Stock of the
                  Obligors, after deducting:

                  (i)      the Value of any such Finished Housing Stock which is
                           held by an Obligor under a part-exchange scheme and
                           has been held by an Obligor for more than 180 days;
                           and

                  (ii)     the amount (if any) by which the Value of Finished
                           Housing Stock which is held by the Obligors under a
                           part-exchange scheme exceeds 10 per cent. of the
                           Adjusted Security Asset Value,

                  as stated in the most recent certificate provided to the
                  Facility Agent under Clause 4.1 (Conditions precedent
                  documents) in the case of the first such certificate or under
                  Clause 17.2 (Compliance certificate) in the case of each
                  subsequent certificate.

         "ADMINISTRATIVE PARTY"

         means the Arranger or the Facility Agent.

         "AFFILIATE"

         means a Subsidiary or a Holding Company of a person or any other
         Subsidiary of that Holding Company.

         "APPLICABLE PRINCIPLES"

         means the accounting principles applied in connection with the Original
         Financial Statements.

         "AVAILABILITY PERIOD"

         means the period from and including the date of this Agreement to and
         including the date which is one month before the Final Maturity Date.

         "BONDING FACILITY"

         has the meaning given to it in the Security Agreement.

         "BORROWER"

         means the Company, an Original Borrower or an Additional Borrower.


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                                       3


         "BREAK COSTS"

         means the amount (if any) which a Lender is entitled to receive under
         this Agreement as compensation if any part of a Loan or overdue amount
         is prepaid.

         "BUSINESS DAY"

         means a day (other than a Saturday or a Sunday) on which banks are open
         for general business in London.

         "CATEGORY 1 LAND"

         means land in the U.K. which is:

         (a)      secured under a Security Document;

         (b)      legally and beneficially owned by an Obligor for the purposes
                  of development; and

         (c)      in respect of which full, implementable planning permission
                  for the relevant development has been obtained, which planning
                  permission has not lapsed.

         "CATEGORY 2 LAND"

         means land in the U.K. which is:

         (a)      secured under a Security Document;

         (b)      legally and beneficially owned by an Obligor for the purposes
                  of development; and

         (c)      in respect of which outline planning permission for the
                  relevant development has been obtained, which planning
                  permission has not lapsed or which has been acquired subject
                  to entering into an agreement under Section 106 of the Town
                  and Country Planning Act 1990.

         "CDHCUK"

         means Centex Development Holding Company UK Limited, a company
         incorporated in England and Wales with registered number 3720262.

         "CENTEX CORPORATION"

         means Centex Corporation, a company incorporated in Nevada, U.S.A.

         "COMMITMENT"

         means:

         (a)      for the Original Lender, the amount set opposite its name in
                  Schedule 1 (Original Parties) under the heading "COMMITMENTS"
                  and the amount of any other Commitment it acquires; and


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                                       4


         (b)      for any other Lender, the amount of any Commitment it
                  acquires,

         to the extent not cancelled, transferred or reduced under this
         Agreement.

         "DANGEROUS SUBSTANCE"

         means any radioactive emissions and any natural or artificial substance
         (whether in the form of a solid, liquid, gas or vapour) the generation,
         transportation, storage, treatment, use or disposal of which (whether
         alone or in combination with any other substance) and including
         (without limitation) any controlled, special, hazardous, toxic,
         radioactive or dangerous waste, is capable of causing harm to any
         living organism or damaging the Environment or public health.

         "DEED OF PARTIAL RELEASE"

         means a document substantially in the form of Part II of Schedule 2 to
         the Security Agreement.

         "DEFAULT"

         means:

         (a)      an Event of Default; or

         (b)      an event which would be (with the expiry of a grace period,
                  the giving of notice or the making of any determination under
                  the Finance Documents or any combination of them) an Event of
                  Default.

         "DEFERRED PURCHASE AGREEMENT"

         means an agreement for the purchase of freehold or leasehold land in
         the U.K. by a member of the Group under which payment of the purchase
         price is deferred for a period of time after legal and beneficial title
         to that land has been transferred to the relevant member of the Group.

         "ENVIRONMENT"

         means all, or any of, the following media: the air (including, without
         limitation, the air within buildings and the air within other natural
         or man-made structures above or below ground), water (including,
         without limitation, ground and surface water) and land (including,
         without limitation, surface and sub-surface soil).

         "ENVIRONMENTAL CLAIM"

         means any claim by any person:

         (a)      in respect of any loss or liability suffered or incurred by
                  that person as a result of or in connection with any violation
                  of Environmental Law; or


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         (b)      that arises as a result of or in connection with Environmental
                  Contamination and that is capable of giving rise to any remedy
                  or penalty (whether interim or final) that may be enforced or
                  assessed by private or public legal action or administrative
                  order or proceedings including, without limitation, any such
                  claim that arises from injury to persons or property.

         "ENVIRONMENTAL CONTAMINATION"

         means each of the following and their consequences:

         (a)      any release, emission, leakage or spillage of any Dangerous
                  Substance at or from any site owned or occupied by an Obligor
                  or any Subsidiary of an Obligor into any part of the
                  Environment;

         (b)      any accident, fire, explosion or sudden event at any site
                  owned or occupied by an Obligor or any Subsidiary of an
                  Obligor which is directly caused by or attributable to any
                  Dangerous Substance; or

         (c)      any other pollution of the Environment arising at or from any
                  site owned or occupied by an Obligor or any Subsidiary of an
                  Obligor.

         "ENVIRONMENTAL LAW"

         means all laws and regulations concerning pollution, the Environment or
         Dangerous Substances.

         "ENVIRONMENTAL APPROVAL"

         means any authorisation required by any Environmental Law.

         "EVENT OF DEFAULT"

         means an event specified as such in this Agreement.

         "FACILITY"

         means the credit facility made available under this Agreement.

         "FACILITY OFFICE"

         means the office(s) notified by a Lender to the Facility Agent:

         (a)      on or before the date it becomes a Lender; or

         (b)      by not less than five Business Days' notice,

         as the office(s) through which it will perform its obligations under
         this Agreement.


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                                       6


         "FEE LETTER"

         means any letter entered into by reference to this Agreement between
         one or more Administrative Parties and the Company setting out the
         amount of certain fees referred to in this Agreement.

         "FINAL MATURITY DATE"

         means the third anniversary of the date of this Agreement.

         "FINANCE DOCUMENT"

         means:

         (a)      this Agreement;

         (b)      a Security Document;

         (c)      a Fee Letter;

         (d)      a Transfer Certificate;

         (e)      an Accession Agreement; or

         (f)      any other document designated as such by the Facility Agent
                  and the Company.

         "FINANCE PARTY"

         means a Lender or an Administrative Party.

         "FINANCIAL INDEBTEDNESS"

         means any indebtedness for or in respect of:

         (a)      moneys borrowed;

         (b)      any acceptance credit;

         (c)      any bond, note, debenture, loan stock or other similar
                  instrument;

         (d)      any finance or capital lease;

         (e)      receivables sold or discounted (otherwise than on a
                  non-recourse basis);

         (f)      the acquisition cost of any asset to the extent payable after
                  its acquisition or possession by the party liable where the
                  deferred payment is arranged primarily as a method of raising
                  finance or financing the acquisition of that asset and
                  includes, for the avoidance of doubt, the acquisition cost of
                  land under a Deferred Purchase Agreement;

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                                       7


         (g)      any derivative transaction protecting against or benefiting
                  from fluctuations in any rate or price (and, except for
                  non-payment of an amount, the then mark to market value of the
                  derivative transaction will be used to calculate its amount);

         (h)      any other transaction (including any forward sale or purchase
                  agreement) which has the commercial effect of a borrowing;

         (i)      any counter-indemnity obligation in respect of any guarantee,
                  indemnity, bond, letter of credit or any other instrument
                  issued by a bank or financial institution; or

         (j)      any guarantee, indemnity or similar assurance against
                  financial loss of any person in respect of any item referred
                  to in paragraphs (a) to (i) above.

         "FINISHED HOUSING STOCK"

         means housing stock in the U.K. which is:

         (a)      legally and beneficially owned by an Obligor;

         (b)      secured under a Security Document; and:

         (c)      (i)      in the case of housing stock constructed by or on
                           behalf of a member of the Group, which is covered by
                           a warranty from the NHBC, The Zurich Insurance
                           Company or any other insurance provider approved by
                           the Facility Agent (acting reasonably); or

                  (ii)     in the case of housing stock acquired by an Obligor
                           under a part-exchange scheme, which is fit for human
                           habitation as a residential property.

         "GROUP"

         means the Company and its Subsidiaries.

         "GUARANTOR"

         means the Company, an Original Guarantor or an Additional Guarantor.

         "HOLDING COMPANY"

         means a holding company within the meaning of section 736 of the
         Companies Act 1985.

         "INCREASED COST"

         means:

         (a)      an additional or increased cost;

         (b)      a reduction in the rate of return under a Finance Document or
                  on its overall capital; or

         (c)      a reduction of an amount due and payable under any Finance
                  Document,

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                                       8



         which is incurred or suffered by a Finance Party or any of its
         Affiliates but only to the extent attributable to that Finance Party
         having entered into any Finance Document or funding or performing its
         obligations under any Finance Document.

         "INTEREST PERIOD"

         means each period determined under this Agreement by reference to which
         interest on a Loan or an overdue amount is calculated.

         "LENDER"

         means:

         (a)      the Original Lender; or

         (b)      any person which becomes a Lender after the date of this
                  Agreement.

         "LETTER OF NON-CRYSTALLISATION"

         means a letter substantially in the form of Part I of Schedule 2 to the
         Security Agreement.

         "LIBOR"

         means for an Interest Period of any Loan or overdue amount:

         (a)      the applicable Screen Rate; or

         (b)      if no Screen Rate is available for the relevant currency or
                  Interest Period of that Loan or overdue amount, the arithmetic
                  mean (rounded upward to four decimal places) of the rates, as
                  supplied to the Facility Agent at its request, quoted by the
                  Reference Banks to leading banks in the London interbank
                  market,

         as of 11.00 a.m. on the Rate Fixing Day for the offering of deposits in
         the currency of that Loan or overdue amount for a period comparable to
         that Interest Period.

         "LOAN"

         means, unless otherwise stated in this Agreement, the principal amount
         of each borrowing under this Agreement or the principal amount
         outstanding of that borrowing.

         "MAJORITY LENDERS"

         means, at any time, Lenders:

         (a)      whose share in the outstanding Loans and whose undrawn
                  Commitments then aggregate more than 50 per cent. of the
                  aggregate of all the outstanding Loans and the undrawn
                  Commitments of all the Lenders;

         (b)      if there is no Loan then outstanding, whose undrawn
                  Commitments then aggregate more than 50 per cent. of the Total
                  Commitments; or

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                                       9


         (c)      if there is no Loan then outstanding and the Total Commitments
                  have been reduced to zero, whose Commitments then aggregate
                  more than 50 per cent. of the Total Commitments immediately
                  before the reduction.

         "MANDATORY COST"

         means the cost of complying with certain regulatory requirements,
         expressed as a percentage rate per annum and calculated by the Facility
         Agent under Schedule 4 (Calculation of the Mandatory Cost).

         "MARGIN"

         means 1 per cent. per annum.

         "MATERIAL ADVERSE EFFECT"

         means a material adverse effect on:

         (a)      the business or financial condition of the Group as a whole;

         (b)      the ability of any Obligor to perform its payment obligations
                  under any Finance Document or the ability of the Company to
                  comply with its obligations under Clause 18 (Financial
                  covenants); or

         (c)      the validity or enforceability of any material provision of
                  any Finance Document.

         "MATERIAL SUBSIDIARY"

         means, at any time, a Subsidiary of the Company whose gross assets,
         profits or net worth (excluding intra-Group items) then equal or exceed
         5 per cent. of the gross assets, profits or net worth of the Group.

         For this purpose:

         (a)      the gross assets, profits or net worth of a Subsidiary of the
                  Company will be determined from its financial statements
                  (unconsolidated if it has Subsidiaries) upon which the latest
                  audited financial statements of the Group have been based;

         (b)      if a Subsidiary of the Company becomes a member of the Group
                  after the date on which the latest audited financial
                  statements of the Group have been prepared, the gross assets,
                  profits or net worth of that Subsidiary will be determined
                  from its latest financial statements;

         (c)      the gross assets, profits or net worth of the Group will be
                  determined from its latest audited financial statements,
                  adjusted (where appropriate) to reflect the gross assets,
                  profits or net worth of any company or business subsequently
                  acquired or disposed of; and

         (d)      if a Material Subsidiary disposes of all or substantially all
                  of its assets to another Subsidiary of the Company, it will
                  immediately cease to be a Material Subsidiary and

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                                       10


                  the other Subsidiary (if it is not already) will immediately
                  become a Material Subsidiary; the subsequent financial
                  statements of those Subsidiaries and the Group will be used to
                  determine whether those Subsidiaries are Material Subsidiaries
                  or not.

         If there is a dispute as to whether or not a company is a Material
         Subsidiary, a certificate of the auditors of the Company will be, in
         the absence of manifest error, conclusive.

         "MATURITY DATE"

         means the last day of the Interest Period of a Loan.

         "NHBC"

         means the National House-Building Council.

         "NHBC STANDARDS"

         means the house-building standards published from time to time by the
         NHBC.

         "OBLIGOR"

         means a Borrower or a Guarantor.

         "ORIGINAL FINANCIAL STATEMENTS"

         means the audited consolidated financial statements of the Company for
         the year ended 31st March, 2000.

         "ORIGINAL OBLIGOR"

         means the Company, an Original Borrower or an Original Guarantor.

         "OVERDRAFT FACILITY"

         has the meaning given to it in the Security Agreement.

         "PARTY"

         means a party to this Agreement.

         "PRO RATA SHARE"

         means:

         (a)      for the purpose of determining a Lender's share in a Loan, the
                  proportion which its Commitment bears to the Total
                  Commitments; and

         (b)      for any other purpose on a particular date:

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                                       11


                  (i)      the proportion which a Lender's share of the Loans
                           (if any) bears to all the Loans;

                  (ii)     if there is no Loan outstanding on that date, the
                           proportion which its Commitment bears to the Total
                           Commitments on that date; or

                  (iii)    if the Total Commitments have been cancelled, the
                           proportion which its Commitments bore to the Total
                           Commitments immediately before being cancelled.

         "RATE FIXING DAY"

         means the first day of an Interest Period or such other day as the
         Facility Agent determines is generally treated as the rate fixing day
         by market practice in the relevant interbank market.

         "REFERENCE BANKS"

         means:

         (a)      until completion of Syndication, the Facility Agent; and

         (b)      subsequently, the Facility Agent and any other bank or
                  financial institution appointed as such by the Facility Agent
                  under this Agreement after consultation with the Company.

         "REPEATING REPRESENTATIONS"

         means the representations which are deemed to be repeated under this
         Agreement.

         "REQUEST"

         means a request for a Loan, substantially in the form of Schedule 3
         (Form of Request).

         "RESERVATIONS"

         means the time barring of claims under the Limitation Acts (or any
         other applicable laws or regulations having a similar effect), the
         possibility that an undertaking to assume liability for or to indemnify
         against non-payment of stamp duty may be void, the possibility that a
         provision relating to capitalisation of interest may be void under the
         laws of some jurisdictions and defences of set-off, counterclaim or
         similar principles.

         "ROLLOVER LOAN"

         means one or more Loans:

         (a)      to be made on the same day that a maturing Loan is due to be
                  repaid;

         (b)      the aggregate amount of which is equal to or less than the
                  maturing Loan; and

         (c)      to be made to the same Borrower for the purpose of refinancing
                  a maturing Loan.

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                                       12


         "SCREEN RATE"

         means the British Bankers Association Interest Settlement Rate (if any)
         for the relevant currency and Interest Period displayed on the
         appropriate page of the Telerate screen selected by the Facility Agent.
         If the relevant page is replaced or the service ceases to be available,
         the Facility Agent (after consultation with the Company and the
         Lenders) may specify another page or service displaying the appropriate
         rate.

         "SECURITY AGREEMENT"

         means a security agreement in the form of Schedule 10 (Form of Security
         Agreement) with such amendments as may be agreed between the Company
         and the Facility Agent or, in the case of an Obligor incorporated in,
         or assets located in, a jurisdiction other than England and Wales, as
         the Facility Agent may reasonably require.

         "SECURITY DOCUMENT"

         means:

         (a)      each Security Agreement; and

         (b)      any other document evidencing or creating security over any
                  asset of an Obligor to secure any obligation of any Obligor to
                  a Finance Party under the Finance Documents.

         "SECURITY INTEREST"

         means any mortgage, pledge, lien, charge, assignment, hypothecation or
         security interest or any other agreement or arrangement having a
         similar effect.

         "SUBSIDIARY"

         means:

         (a)      a subsidiary within the meaning of section 736 of the
                  Companies Act 1985; and

         (b)      unless the context otherwise requires, a subsidiary
                  undertaking within the meaning of section 258 of the Companies
                  Act 1985.

         "SYNDICATION"

         means general syndication of the Facility by the Arranger.

         "SYNDICATION AGREEMENT"

         means the agreement to be entered into by the Parties and the banks
         from Syndication under which those banks will become Parties.


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                                       13


         "TAX"

         means any tax, levy, impost, duty or other charge or withholding of a
         similar nature (including any related penalty or interest).

         "TAX DEDUCTION"

         means a deduction or withholding for or on account of Tax from a
         payment under a Finance Document.

         "TAX PAYMENT"

         means a payment made by an Obligor to a Finance Party in any way
         relating to a Tax Deduction or under any indemnity given by that
         Obligor in respect of Tax under any Finance Document.

         "TOTAL COMMITMENTS"

         means the Commitments of all the Lenders.

         "TRANSFER CERTIFICATE"

         means a certificate, substantially in the form of Schedule 5 (Form of
         Transfer Certificate), with such amendments (provided they are not
         prejudicial to any Obligor) as the Facility Agent may approve or
         reasonably require or any other form agreed between the Facility Agent
         and the Company.

         "U.K."

         means the United Kingdom.

         "U.S.A."

         means the United States of America.

         "UTILISATION DATE"

         means each date on which the Facility is utilised.

         "VALUE"

         means, in respect of an asset for the purposes of calculating the
         Adjusted Security Asset Value at any time, the lower of:

         (a)      the cost of the relevant asset; and

         (b)      the relevant asset's net realisable value at that time.

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                                       14


         "WORK IN PROGRESS"

         means, at any time normal expenditure incurred by an Obligor in the
         construction of housing and supporting site infrastructure which is
         capitalised within work in progress in accordance with the Applicable
         Principles.

         "3333 HOLDING CORPORATION"

         means 3333 Holding Corporation, a company incorporated in Nevada,
         U.S.A.

1.2      CONSTRUCTION

(a)      In this Agreement, unless the contrary intention appears, a reference
         to:

         (i)      an "AMENDMENT" includes a supplement, novation, restatement or
                  re-enactment and "amended" will be construed accordingly;

                  "ASSETS" includes present and future properties, revenues and
                  rights of every description;

                  an "AUTHORISATION" includes an authorisation, consent,
                  approval, resolution, licence, exemption, filing, registration
                  or notarisation;

                  "DISPOSAL" means a sale, transfer, grant, lease or other
                  disposal, whether voluntary or involuntary, and "DISPOSE" will
                  be construed accordingly;

                  "INDEBTEDNESS" includes any obligation (whether incurred as
                  principal or as surety) for the payment or repayment of money;

                  a "PERSON" includes any individual, company, corporation,
                  unincorporated association or body (including a partnership,
                  trust, joint venture or consortium), government, state,
                  agency, organisation or other entity whether or not having
                  separate legal personality;

                  a "REGULATION" includes any regulation, rule, official
                  directive, request or guideline (whether or not having the
                  force of law but, if not having the force of law, being of a
                  type with which any person to which it applies is accustomed
                  to comply) of any governmental, inter-governmental or
                  supranational body, agency, department or regulatory,
                  self-regulatory or other authority or organisation;

         (ii)     a currency is a reference to the lawful currency for the time
                  being of the relevant country;

         (iii)    a Default being "OUTSTANDING" means that it has not been
                  remedied or waived;

         (iv)     a provision of law is a reference to that provision as
                  extended, applied, amended or re-enacted and includes any
                  subordinate legislation;

         (v)      a Clause, a Subclause or a Schedule is a reference to a clause
                  or subclause of, or a schedule to, this Agreement;

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                                       15



         (vi)     a person includes its successors in title, permitted assigns
                  and permitted transferees;

         (vii)    a Finance Document or another document is a reference to that
                  Finance Document or other document as amended; and

         (viii)   a time of day is a reference to London time.

(b)      Unless the contrary intention appears, a reference to a "MONTH" or
         "MONTHS" is a reference to a period starting on one day in a calendar
         month and ending on the numerically corresponding day in the next
         calendar month or the calendar month in which it is to end, except
         that:

         (i)      if the numerically corresponding day is not a Business Day,
                  the period will end on the next Business Day in that month (if
                  there is one) or the preceding Business Day (if there is not);

         (ii)     if there is no numerically corresponding day in that month,
                  that period will end on the last Business Day in that month;
                  and

         (iii)    notwithstanding sub-paragraph (i) above, a period which
                  commences on the last Business Day of a month will end on the
                  last Business Day in the next month or the calendar month in
                  which it is to end, as appropriate.

(c)      (i)      Unless expressly provided to the contrary in a Finance
                  Document, a person who is not a party to a Finance Document
                  may not enforce any of its terms under the Contracts (Rights
                  of Third Parties) Act 1999.

         (ii)     Notwithstanding any term of any Finance Document, the consent
                  of any third party is not required for any variation
                  (including any release or compromise of any liability under)
                  or termination of that Finance Document.

(d)      Unless the contrary intention appears:

         (i)      a reference to a Party will not include that Party if it has
                  ceased to be a Party under this Agreement;

         (ii)     a term used in any other Finance Document or in any notice
                  given in connection with any Finance Document has the same
                  meaning in that Finance Document or notice as in this
                  Agreement;

         (iii)    if there is an inconsistency between this Agreement and any
                  other Finance Document, this Agreement will prevail;

         (iv)     any obligation of an Obligor under the Finance Documents which
                  is not a payment obligation remains in force for so long as
                  any payment obligation is or may be outstanding under the
                  Finance Documents; and

         the headings in this Agreement do not affect its interpretation.
<PAGE>   19
                                       16



2.       FACILITY

2.1      FACILITY

         Subject to the terms of this Agreement, the Lenders make available to
         the Borrowers a Sterling revolving credit facility in an aggregate
         amount equal to the Total Commitments.

2.2      NATURE OF A FINANCE PARTY'S RIGHTS AND OBLIGATIONS

         Unless otherwise agreed by all the Finance Parties:

         (a)      the obligations of a Finance Party under the Finance Documents
                  are several;

         (b)      failure by a Finance Party to perform its obligations does not
                  affect the obligations of any other Party under the Finance
                  Documents;

         (c)      no Finance Party is responsible for the obligations of any
                  other Finance Party under the Finance Documents;

         (d)      the rights of a Finance Party under the Finance Documents are
                  separate and independent rights;

         (e)      a debt arising under the Finance Documents to a Finance Party
                  is a separate and independent debt; and

         (f)      a Finance Party may, except as otherwise stated in the Finance
                  Documents, separately enforce those rights.

3.       PURPOSE

3.1      LOANS

         Each Loan may only be used for general corporate and/or working capital
         purposes of the Group or any purpose specifically permitted under this
         Agreement.

3.2      NO OBLIGATION TO MONITOR

         No Finance Party is bound to monitor or verify the utilisation of the
         Facility.

4.       CONDITIONS PRECEDENT

4.1      CONDITIONS PRECEDENT DOCUMENTS

         A Request may not be given until the Facility Agent has notified the
         Company and the Lenders that it has received all of the documents and
         evidence set out in Part I of Schedule 2 (Conditions precedent
         documents) in form and substance satisfactory to the Facility Agent.
         The Facility Agent must give this notification as soon as reasonably
         practicable.
<PAGE>   20
                                       17


4.2      FURTHER CONDITIONS PRECEDENT

         The obligations of each Lender to participate in any Loan are subject
         to the further conditions precedent that:

         (a)      on both the date of the Request and the Utilisation Date for
                  that Loan:

                  (i)      the Repeating Representations are correct in all
                           material respects;

                  (ii)     no Default or, in the case of a Rollover Loan, no
                           Event of Default is outstanding or would result from
                           the Loan; and

         (b)      the aggregate principal amount of:

                  (i)      outstanding Loans;

                  (ii)     the net amount outstanding under the Overdraft
                           Facility; and

                  (iii)    amounts outstanding under the Bonding Facility,

                  immediately after that Loan is made will not exceed the then
                  current Adjusted Security Asset Value.

4.3      MAXIMUM NUMBER

         Unless the Facility Agent agrees, a Request may not be given if, as a
         result, there would be more than 15 Loans outstanding.

5.       UTILISATION

5.1      GIVING OF REQUESTS

(a)      A Borrower may borrow a Loan by giving to the Facility Agent a duly
         completed Request.

(b)      Unless the Facility Agent otherwise agrees, the latest time for receipt
         by the Facility Agent of a duly completed Request is 11.00 a.m. one
         Business Day before the Rate Fixing Day for the proposed borrowing.

(c)      Each Request is irrevocable.

5.2      COMPLETION OF REQUESTS

         A Request will not be regarded as having been duly completed unless:

         (a)      it identifies the Borrower;

         (b)      the Utilisation Date is a Business Day falling within the
                  Availability Period; and

         (c)      the proposed, amount and Interest Period comply with this
                  Agreement.

<PAGE>   21
                                       18



         Only one Loan may be requested in a Request.

5.3      AMOUNT OF LOAN

(a)      Except as provided below, the amount of the Loan must be a minimum of
         pound sterling 2,000,000 and an integral multiple of pound sterling
         1,000,000.

(b)      The amount of the Loan may also be the balance of the undrawn Total
         Commitments or such other amount as the Facility Agent and the Lenders
         may agree.

(c)      The amount of each Lender's share of the Loan will be its Pro Rata
         Share on the proposed Utilisation Date.

5.4      ADVANCE OF LOAN

(a)      The Facility Agent must promptly notify each Lender of the details of
         the requested Loan and the amount of its share in that Loan.

(b)      No Lender is obliged to participate in a Loan if, as a result, the
         Loans would exceed the Total Commitments.

(c)      If the conditions set out in this Agreement have been met, each Lender
         must make its share in the Loan available to the Facility Agent for the
         relevant Borrower on the Utilisation Date.

6.       REPAYMENT

(a)      Each Borrower must repay each Loan made to it in full on its Maturity
         Date.

(b)      Subject to the other terms of this Agreement, any amounts repaid under
         paragraph (a) above may be re-borrowed.

7.       PREPAYMENT AND CANCELLATION

7.1      MANDATORY PREPAYMENT - ILLEGALITY

(a)      A Lender must notify the Company promptly if it becomes aware that it
         is unlawful in any jurisdiction for that Lender to perform any of its
         obligations under a Finance Document or to fund or maintain its share
         in any Loan.

(b)      After notification under paragraph (a) above:

         (i)      each Borrower must repay or prepay the share of that Lender in
                  each Loan made to it on the date specified in paragraph (c)
                  below; and

         (ii)     the Commitment of that Lender will be immediately cancelled.

(c)      The date for repayment or prepayment of a Lender's share in a Loan will
         be:

         (i)      the third Business Day following receipt by the Company of
                  notice from the Lender under paragraph (a) above; or

<PAGE>   22
                                       19


         (ii)     if later, the latest date allowed by the relevant law which
                  shall be notified to the Company by the relevant Lender as
                  soon as reasonably practicable.

7.2      MANDATORY PREPAYMENT - BREACH OF ADJUSTED SECURITY ASSET VALUE

(a)      The Company must promptly notify the Facility Agent if, at any time,
         the aggregate principal amount of:


         (i)      outstanding Loans;

         (ii)     the net amount outstanding under the Overdraft Facility; and

         (iii)    amounts outstanding under the Bonding Facility,

         exceeds the Adjusted Security Asset Value at that time.

(b)      After notification under paragraph (a) above, the Borrowers must
         either:

         (i)      prepay the amount of the Loans necessary to ensure that the
                  aggregate outstanding principal amount of the items referred
                  to in sub-paragraphs (a)(i) to (iii) above no longer exceeds
                  the Adjusted Security Asset Value; or

         (ii)     provide cash cover to the Facility Agent in the relevant
                  amount.

(c)      The date for prepayment under paragraph (b) above will be the date
         which is 3 Business Days after receipt by the Facility Agent of the
         notice from the Company under paragraph (a) above, or such later date
         as is agreed to by the Lenders.

7.3      VOLUNTARY PREPAYMENT

(a)      The Company may, by giving not less than 5 Business Days' prior notice
         to the Facility Agent, prepay (or ensure that a Borrower prepays) any
         Loan at any time in whole or in part.

(b)      A prepayment of part of a Loan must be in a minimum amount of pound
         sterling 1,000,000 and an integral multiple of pound sterling
         1,000,000.

7.4      AUTOMATIC CANCELLATION

         The Commitment of each Lender will be automatically cancelled at the
         close of business on the last day of the Availability Period.

7.5      VOLUNTARY CANCELLATION

(a)      The Company may, by giving not less than 5 Business Days' prior notice
         to the Facility Agent, cancel the unutilised amount of the Total
         Commitments in whole or in part.

(b)      Partial cancellation of the Total Commitments must be in a minimum
         amount of pound sterling 1,000,000 and an integral multiple of pound
         sterling 1,000,000.

(c)      Any cancellation in part will be applied against the Commitment of each
         Lender pro rata.

<PAGE>   23
                                       20



7.6      INVOLUNTARY PREPAYMENT AND CANCELLATION

(a)      If an Obligor is, or will be, required to pay to a Lender a Tax Payment
         or an Increased Cost, the Company may, while the requirement continues,
         give notice to the Facility Agent requesting prepayment and
         cancellation in respect of that Lender.

(b)      After notification under paragraph (a) above:

         (i)      each Borrower must repay or prepay that Lender's share in each
                  Loan made to it on the date specified in paragraph (c) below;
                  and

         (ii)     the Commitment of that Lender will be immediately cancelled.

(c)      The date for repayment or prepayment of a Lender's share in a Loan will
         be the last day of the Interest Period for that Loan or, if earlier,
         the date specified by the Company in its notification.

7.7      RE-BORROWING OF LOANS

(a)      Any:

         (i)      voluntary prepayment of a Loan; or

         (ii)     involuntary prepayment of a Loan under Clause 7.2 (Mandatory
                  Prepayment - breach of Adjusted Security Asset Value),

         may be re-borrowed on the terms of this Agreement.

(b)      Subject to paragraph (a)(ii) above, any mandatory or involuntary
         prepayment of a Loan may not be re-borrowed.

7.8      MISCELLANEOUS PROVISIONS

(a)      Any notice of prepayment and/or cancellation under this Agreement is
         irrevocable and must specify the relevant date(s) and the affected
         Loans and Commitments. The Facility Agent must notify the Lenders
         promptly of receipt of any such notice.

(b)      All prepayments under this Agreement must be made with accrued interest
         on the amount prepaid. No premium or penalty is payable in respect of
         any prepayment except for Break Costs.

(c)      The Majority Lenders may agree a shorter notice period for a voluntary
         prepayment or a voluntary cancellation.

(d)      No prepayment or cancellation is allowed except in accordance with the
         express terms of this Agreement.

(e)      No amount of the Total Commitments cancelled under this Agreement may
         subsequently be reinstated.
<PAGE>   24
                                       21


8.       INTEREST

8.1      CALCULATION OF INTEREST

         The rate of interest on each Loan for each Interest Period is the
         percentage rate per annum equal to the aggregate of the applicable:

         (a)      Margin;

         (b)      LIBOR; and

         (c)      Mandatory Cost.

8.2      PAYMENT OF INTEREST

         Except where it is provided to the contrary in this Agreement, each
         Borrower must pay accrued interest on each Loan made to it on the last
         day of each Interest Period and also, if the Interest Period is longer
         than six months, on the dates falling at six-monthly intervals after
         the first day of that Interest Period.

8.3      INTEREST ON OVERDUE AMOUNTS

(a)      If an Obligor fails to pay any amount payable by it under the Finance
         Documents, it must immediately on demand by the Facility Agent pay
         interest on the overdue amount from its due date up to the date of
         actual payment, both before, on and after judgment.

(b)      Interest on an overdue amount is payable at a rate determined by the
         Facility Agent to be one per cent. per annum above the rate which would
         have been payable if the overdue amount had, during the period of
         non-payment, constituted a Loan in the currency of the overdue amount.
         For this purpose, the Facility Agent may (acting reasonably):

         (i)      select successive Interest Periods of any duration of up to
                  three months; and

         (ii)     determine the appropriate Rate Fixing Day for that Interest
                  Period.

(c)      Notwithstanding paragraph (b) above, if the overdue amount is a
         principal amount of a Loan and becomes due and payable prior to the
         last day of its current Interest Period, then:

         (i)      the first Interest Period for that overdue amount will be the
                  unexpired portion of that Interest Period; and

         (ii)     the rate of interest on the overdue amount for that first
                  Interest Period will be one per cent. per annum above the rate
                  then payable on that Loan.

         After the expiry of the first Interest Period for that overdue amount,
         the rate on the overdue amount will be calculated in accordance with
         paragraph (b) above.

(d)      Interest (if unpaid) on an overdue amount will be compounded with that
         overdue amount at the end of each of its Interest Periods but will
         remain immediately due and payable.
<PAGE>   25
                                       22



8.4      NOTIFICATION OF RATES OF INTEREST

         The Facility Agent must promptly notify each relevant Party of the
         determination of a rate of interest under this Agreement.

9.       TERMS

9.1      SELECTION

(a)      Each Loan has one Interest Period only.

(b)      A Borrower must select the Interest Period for a Loan in the relevant
         Request.

(c)      Subject to the following provisions of this Clause, each Interest
         Period for a Loan will be one, two, three or six months or any other
         period agreed by the relevant Borrower and the Lenders.

(d)      Until completion of Syndication, each Interest Period must be a period
         of one month or any other period agreed by the Facility Agent.

9.2      NO OVERRUNNING THE FINAL MATURITY DATE

         If any Interest Period would otherwise overrun the Final Maturity Date,
         it will be shortened so that it ends on the Final Maturity Date.

9.3      NOTIFICATION

         The Facility Agent must notify the Borrower and the Lenders of the
         duration of each Interest Period promptly after ascertaining its
         duration.

10.      MARKET DISRUPTION

10.1     FAILURE OF A REFERENCE BANK TO SUPPLY A RATE

         If LIBOR is to be calculated by reference to the Reference Banks but a
         Reference Bank does not supply a rate by 12.00 noon on a Rate Fixing
         Day, the applicable LIBOR will, subject as provided below, be
         calculated on the basis of the rates of the remaining Reference Banks.

10.2     MARKET DISRUPTION

(a)      In this Clause, each of the following events is a "MARKET DISRUPTION
         EVENT":

         (i)      LIBOR is to be calculated by reference to the Reference Banks
                  but no, or, after completion of Syndication, only one,
                  Reference Bank supplies a rate by 12.00 noon on the Rate
                  Fixing Day; or

         (ii)     the Facility Agent receives by close of business on the Rate
                  Fixing Day notification from Lenders whose shares in the
                  relevant Loan exceed 30 per cent. of that Loan that the cost
                  to them of obtaining matching deposits in the relevant
                  interbank market is in excess of LIBOR for the relevant
                  Interest Period.
<PAGE>   26
                                       23



(b)      The Facility Agent must promptly notify the Company and the Lenders of
         a market disruption event.

(c)      After notification under paragraph (b) above, the rate of interest on
         each Lender's share in the affected Loan for the relevant Interest
         Period will be the aggregate of the applicable:

         (i)      Margin;

         (ii)     rate notified to the Facility Agent by that Lender as soon as
                  practicable to be that which expresses as a percentage rate
                  per annum the cost to that Lender of funding its share in that
                  Loan from whatever source it may reasonably select; and

         (iii)    Mandatory Cost.

10.3     ALTERNATIVE BASIS OF INTEREST OR FUNDING

(a)      If a market disruption event occurs and the Facility Agent or the
         Company so requires, the Company and the Facility Agent must enter into
         negotiations for a period of not more than 30 days with a view to
         agreeing an alternative basis for determining the rate of interest
         and/or funding for the affected Loan and any future Loan.

(b)      Any alternative basis agreed will be, with the prior consent of all the
         Lenders, binding on all the Parties.

11.      TAXES

11.1     GENERAL

         In this Clause:

         "QUALIFYING LENDER"

         means a Lender which is:

         (a)      a U.K. Lender; or

         (b)      a Treaty Lender.

         "TAX CREDIT"

         means a credit against any Tax or any relief or remission for Tax (or
         its repayment).

         "TREATY LENDER"

         means a Lender which is, on the date a payment of interest falls due
         under this Agreement:

         (a)      resident (as defined in the appropriate double taxation
                  agreement) in a country with which the U.K. has a double
                  taxation agreement giving residents of that country exemption
                  from U.K. taxation on interest; and

<PAGE>   27
                                       24



         (b)      does not carry on a business in the U.K. through a permanent
                  establishment with which the payment is effectively connected.

         "U.K. LENDER"

         means a Lender which is within the charge to U.K. corporation tax in
         respect of, and beneficially entitled to, a payment of interest on a
         Loan made by a person that was a bank for the purposes of section 349
         of the Income and Corporation Taxes Act 1988 (as currently defined in
         section 840A of the Income and Corporation Taxes Act) at the time the
         Loan was made.

11.2     TAX GROSS-UP

(a)      Each Obligor must make all payments to be made by it under the Finance
         Documents without any Tax Deduction, unless a Tax Deduction is required
         by law.

(b)      If:

         (i)      a Lender is not, or ceases to be, a Qualifying Lender; or

         (ii)     an Obligor or a Lender is aware that an Obligor must make a
                  Tax Deduction (or that there is a change in the rate or the
                  basis of a Tax Deduction),

         it must promptly notify the Facility Agent. The Facility Agent must
         then promptly notify the affected Parties.

(c)      Except as provided below, if a Tax Deduction is required by law to be
         made by an Obligor or the Facility Agent, the amount of the payment due
         from the Obligor will be increased to an amount which (after making the
         Tax Deduction) leaves an amount equal to the payment which would have
         been due if no Tax Deduction had been required.

(d)      (i)      Except as provided below, an Obligor resident for tax purposes
                  in the U.K. is not required to make an increased payment under
                  paragraph (c) above to a Lender that is not, or has ceased to
                  be, a Qualifying Lender in excess of the amount that the
                  Obligor would have had to pay had the Lender been, or not
                  ceased to be, a Qualifying Lender.

         (ii)     Sub-paragraph (i) above will not apply if the Lender has
                  ceased to be a Qualifying Lender by reason of any change after
                  the date it became a Lender under this Agreement in (or in the
                  interpretation, administration, or application of) any law or
                  double taxation agreement or any published practice or
                  concession of any relevant taxing authority.

(e)      An Obligor resident for tax purposes in the U.K. is not required to
         make an increased payment to a Lender under paragraph (c) above if that
         Lender is a Treaty Lender and the Obligor making the payment is able to
         demonstrate that the Tax Deduction would not have been required if the
         Lender had complied with its obligations under paragraph (h) below.

(f)      If an Obligor is required to make a Tax Deduction, that Obligor must
         make the minimum Tax Deduction and must make any payment required in
         connection with that Tax Deduction within the time allowed by law.

<PAGE>   28
                                       25



(g)      Within 30 days of making either a Tax Deduction or a payment required
         in connection with a Tax Deduction, the Obligor making that Tax
         Deduction or payment must deliver to the Facility Agent for the
         relevant Finance Party evidence satisfactory to that Finance Party
         (acting reasonably) that the Tax Deduction has been made or (as
         applicable) the appropriate payment has been paid to the relevant
         taxing authority.

(h)      A Treaty Lender must co-operate with each Obligor by using its
         reasonable endeavours to complete any procedural formalities necessary
         for that Obligor to obtain authorisation to make that payment without a
         Tax Deduction.

11.3     TAX INDEMNITY

(a)      Except as provided below, the Company must indemnify a Finance Party
         against any loss or liability which that Finance Party (in its absolute
         discretion) determines will be or has been suffered (directly or
         indirectly) by that Finance Party for or on account of Tax in relation
         to a payment received or receivable (or any payment deemed to be
         received or receivable) under a Finance Document.

(b)      Paragraph (a) above does not apply to any Tax assessed on a Finance
         Party under the laws of the jurisdiction in which:

         (i)      that Finance Party is incorporated or, if different, the
                  jurisdiction (or jurisdictions) in which that Finance Party is
                  treated as resident for tax purposes; or

         (ii)     that Finance Party's Facility Office is located in respect of
                  amounts received or receivable in that jurisdiction,

         if that Tax is imposed on or calculated by reference to the net income
         received or receivable by that Finance Party. However, any payment
         deemed to be received or receivable, including any amount treated as
         income but not actually received by the Finance Party, such as a Tax
         Deduction, will not be treated as net income received or receivable for
         this purpose.

(c)      A Finance Party making, or intending to make, a claim under paragraph
         (a) above must promptly notify the Company of the event which will
         give, or has given, rise to the claim.

11.4     TAX CREDIT

         If an Obligor makes a Tax Payment and the relevant Finance Party (in
         its absolute discretion) determines that:

         (a)      a Tax Credit is attributable to that Tax Payment; and

         (b)      it has used that Tax Credit,

         the Finance Party must pay an amount to the Obligor which that Finance
         Party determines (in its absolute discretion) will leave it (after that
         payment) in the same after-tax position as it would have been in if the
         Tax Payment had not been made by the Obligor.

<PAGE>   29
                                       26



11.5     STAMP TAXES

         The Company must pay and indemnify each Finance Party against any stamp
         duty, registration or other similar Tax payable in connection with the
         entry into, performance or enforcement of any Finance Document, except
         for any such Tax payable in connection with the entry into of a
         Transfer Certificate.

11.6     VALUE ADDED TAXES

(a)      Any amount (including costs and expenses) payable under a Finance
         Document by an Obligor is exclusive of any value added tax which might
         be chargeable in connection with that amount. If any such value added
         tax is chargeable, the Obligor must pay to the Finance Party (in
         addition to and at the same time as paying that amount) an amount equal
         to the amount of that value added tax.

(b)      The obligation of any Obligor under paragraph (a) above will be reduced
         to the extent that the Finance Party is entitled to repayment or a
         credit in respect of the relevant Tax.

12.      INCREASED COSTS

12.1     INCREASED COSTS

         Except as provided below in this Clause, the Company must pay to a
         Finance Party the amount of any Increased Cost incurred by that Finance
         Party or any of its Affiliates as a result of:

         (a)      the introduction of, or any change in, or any change in the
                  interpretation or application of, any law or regulation; or

         (b)      compliance with any law or regulation,

         made after the date of this Agreement.

12.2     EXCEPTIONS

         The Company need not make any payment for an Increased Cost to the
         extent that the Increased Cost is:

         (a)      compensated for under another Clause or would have been but
                  for an exception to that Clause;

         (b)      a tax on the overall net income of a Finance Party or any of
                  its Affiliates; or

         (c)      attributable to a Finance Party or its Affiliate wilfully,
                  negligently or recklessly failing to comply with any law or
                  regulation.

12.3     CLAIMS

         A Finance Party intending to make a claim for an Increased Cost must
         notify the Company promptly of the circumstances giving rise to, and
         the amount of, the claim.

<PAGE>   30
                                       27



13.      MITIGATION

13.1     MITIGATION

(a)      Each Finance Party must, in consultation with the Company, take all
         reasonable steps to mitigate any circumstances which arise and which
         result or would result in:

         (i)      any Tax Payment or Increased Cost being payable to that
                  Finance Party; or

         (ii)     that Finance Party being able to exercise any right of
                  prepayment and/or cancellation under this Agreement by reason
                  of any illegality,

         including transferring its rights and obligations under the Finance
         Documents to an Affiliate or changing its Facility Office.

(b)      The Company must indemnify each Finance Party for all costs and
         expenses reasonably incurred by that Finance Party as a result of any
         step taken by it under this Subclause.

(c)      A Finance Party is not obliged to take any step under this Subclause
         if, in the opinion of that Finance Party (acting reasonably), to do so
         might be prejudicial to it.

13.2     CONDUCT OF BUSINESS BY A FINANCE PARTY

         No term of this Agreement will:

         (a)      interfere with the right of any Finance Party to arrange its
                  affairs (Tax or otherwise) in whatever manner it thinks fit;

         (b)      oblige any Finance Party to investigate or claim any credit,
                  relief, remission or repayment available to it in respect of
                  Tax or the extent, order and manner of any claim; or

         (c)      oblige any Finance Party to disclose any information relating
                  to its affairs (Tax or otherwise) or any computation in
                  respect of Tax.

14.      PAYMENTS

14.1     PLACE

         Unless a Finance Document specifies that payments under it are to be
         made in another manner, all payments by a Party (other than the
         Facility Agent) under the Finance Documents must be made to the
         Facility Agent to its account at such office or bank in the principal
         financial centre of the country of the relevant currency as it may
         notify to that Party for this purpose by not less than five Business
         Days' prior notice.

14.2     FUNDS

         Payments under the Finance Documents to the Facility Agent must be made
         for value on the due date at such times and in such funds as the
         Facility Agent may specify to the Party


<PAGE>   31
                                       28



         concerned as being customary at the time for the settlement of
         transactions in the relevant currency in the place for payment.

14.3     DISTRIBUTION

(a)      Each payment received by the Facility Agent under the Finance Documents
         for another Party must, except as provided below, be made available by
         the Facility Agent to that Party by payment (as soon as practicable
         after receipt) to its account with such office or bank in the principal
         financial centre of the country of the relevant currency as it may
         notify to the Facility Agent for this purpose by not less than five
         Business Days' prior notice.

(b)      The Facility Agent may apply any amount received by it for an Obligor
         in or towards payment (as soon as practicable after receipt) of any
         amount due from that Obligor under the Finance Documents or in or
         towards the purchase of any amount of any currency to be so applied.

(c)      Where a sum is paid to the Facility Agent under this Agreement for
         another Party, the Facility Agent is not obliged to pay that sum to
         that Party until it has established that it has actually received it.
         However, the Facility Agent may assume that the sum has been paid to
         it, and, in reliance on that assumption, make available to that Party a
         corresponding amount. If it transpires that the sum has not been
         received by the Facility Agent, that Party must immediately on demand
         by the Facility Agent refund any corresponding amount made available to
         it together with interest on that amount from the date of payment to
         the date of receipt by the Facility Agent at a rate calculated by the
         Facility Agent to reflect its cost of funds.

14.4     CURRENCY

(a)      Unless a Finance Document specifies that payments under it are to be
         made in a different manner, the currency of each amount payable under
         the Finance Documents is determined under this Clause.

(b)      Interest is payable in the currency in which the relevant amount in
         respect of which it is payable is denominated.

(c)      A repayment or prepayment of any principal amount is payable in the
         currency in which that principal amount is denominated on its due date.

(d)      Amounts payable in respect of costs and expenses are payable in the
         currency in which they are incurred.

(e)      Each other amount payable under the Finance Documents is payable in
         Sterling.

14.5     NO SET-OFF OR COUNTERCLAIM

         All payments made by an Obligor under the Finance Documents must be
         made without set-off or counterclaim.
<PAGE>   32
                                       29



14.6     BUSINESS DAYS

(a)      If a payment under the Finance Documents is due on a day which is not a
         Business Day, the due date for that payment will instead be the next
         Business Day in the same calendar month (if there is one) or the
         preceding Business Day (if there is not) or whatever day the Facility
         Agent determines is market practice.

(b)      During any extension of the due date for payment of any principal under
         this Agreement interest is payable on that principal at the rate
         payable on the original due date.

14.7     PARTIAL PAYMENTS

(a)      If the Facility Agent receives a payment insufficient to discharge all
         the amounts then due and payable by the Obligors under the Finance
         Documents, the Facility Agent must apply that payment towards the
         obligations of the Obligors under the Finance Documents in the
         following order:

         (i)      first, in or towards payment pro rata of any due but unpaid
                  fees, costs and expenses of the Facility Agent under the
                  Finance Documents;

         (ii)     secondly, in or towards payment pro rata of any accrued
                  interest or fee due but unpaid under this Agreement;

         (iii)    thirdly, in or towards payment pro rata of any principal
                  amount due but unpaid under this Agreement; and

         (iv)     fourthly, in or towards payment pro rata of any other sum due
                  but unpaid under the Finance Documents.

(b)      The Facility Agent must, if so directed by all the Lenders, vary the
         order set out in sub-paragraphs (a)(ii) to (iv) above.

(c)      This Subclause will override any appropriation made by an Obligor.

14.8     TIMING OF PAYMENTS

         If a Finance Document does not provide for when a particular payment is
         due, that payment will be due within three Business Days of demand by
         the relevant Finance Party.

15.      GUARANTEE AND INDEMNITY

15.1     GUARANTEE AND INDEMNITY

         Each Guarantor jointly and severally and irrevocably and
         unconditionally:

         (a)      guarantees to each Finance Party punctual performance by each
                  Borrower of all its payment obligations under the Finance
                  Documents;
<PAGE>   33
                                       30



         (b)      undertakes with each Finance Party that, whenever a Borrower
                  does not pay any amount when due under any Finance Document,
                  it must immediately on demand by the Facility Agent pay that
                  amount as if it were the principal obligor; and

         (c)      indemnifies each Finance Party immediately on demand against
                  any loss or liability suffered by that Finance Party if any
                  obligation guaranteed by it is or becomes unenforceable,
                  invalid or illegal; the amount of the loss or liability under
                  this indemnity will be equal to the amount the Finance Party
                  would otherwise have been entitled to recover.

15.2     CONTINUING GUARANTEE

         This guarantee is a continuing guarantee and will extend to the
         ultimate balance of all sums payable by any Obligor under the Finance
         Documents, regardless of any intermediate payment or discharge in whole
         or in part.

15.3     REINSTATEMENT

(a)      If any discharge (whether in respect of the obligations of any Obligor
         or any security for those obligations or otherwise) or arrangement is
         made in whole or in part on the faith of any payment, security or other
         disposition which is avoided or must be restored on insolvency,
         liquidation or otherwise without limitation, the liability of each
         Guarantor under this Clause will continue as if the discharge or
         arrangement had not occurred.

(b)      Each Finance Party may concede or compromise any claim that any
         payment, security or other disposition is liable to avoidance or
         restoration.

15.4     WAIVER OF DEFENCES

         The obligations of each Guarantor under this Clause will not be
         affected by any act, omission or thing which, but for this provision,
         would reduce, release or prejudice any of its obligations under this
         Clause (whether or not known to it or any Finance Party). This
         includes:

         (a)      any time or waiver granted to, or composition with, any
                  person;

         (b)      any release of any person under the terms of any composition
                  or arrangement;

         (c)      the taking, variation, compromise, exchange, renewal or
                  release of, or refusal or neglect to perfect, take up or
                  enforce, any rights against, or security over assets of, any
                  person;

         (d)      any non-presentation or non-observance of any formality or
                  other requirement in respect of any instrument or any failure
                  to realise the full value of any security;

         (e)      any incapacity or lack of power, authority or legal
                  personality of or dissolution or change in the members or
                  status of any person;

         (f)      any amendment (however fundamental) of a Finance Document or
                  any other document or security; or
<PAGE>   34
                                       31



         (g)      any unenforceability, illegality, invalidity or
                  non-provability of any obligation of any person under any
                  Finance Document or any other document or security.

15.5     IMMEDIATE RECOURSE

         Each Guarantor waives any right it may have of first requiring any
         Finance Party (or any trustee or agent on its behalf) to proceed
         against or enforce any other right or security or claim payment from
         any person before claiming from that Guarantor under this Clause.

15.6     APPROPRIATIONS

         Until all amounts which may be or become payable by the Obligors under
         the Finance Documents have been irrevocably paid in full, each Finance
         Party (or any trustee or agent on its behalf) may:

         (a)      without affecting the liability of any Guarantor under this
                  Clause:

                  (i)      refrain from applying or enforcing any other moneys,
                           security or rights held or received by that Finance
                           Party (or any trustee or agent on its behalf) in
                           respect of those amounts; or

                  (ii)     apply and enforce them in such manner and order as it
                           sees fit (whether against those amounts or
                           otherwise); and


         (b)      hold in an interest-bearing suspense account any moneys
                  received from any Guarantor or on account of that Guarantor's
                  liability under this Clause.

15.7     NON-COMPETITION

         Unless:

         (a)      all amounts which may be or become payable by the Obligors
                  under the Finance Documents have been irrevocably paid in
                  full; or

         (b)      the Facility Agent otherwise directs,

         no Guarantor will, after a claim has been made or by virtue of any
         payment or performance by it under this Clause:

         (i)      be subrogated to any rights, security or moneys held, received
                  or receivable by any Finance Party (or any trustee or agent on
                  its behalf);

         (ii)     be entitled to any right of contribution or indemnity in
                  respect of any payment made or moneys received on account of
                  that Guarantor's liability under this Clause;

         (iii)    claim, rank, prove or vote as a creditor of any Obligor or its
                  estate in competition with any Finance Party (or any trustee
                  or agent on its behalf); or

         (iv)     receive, claim or have the benefit of any payment,
                  distribution or security from or on account of any Obligor, or
                  exercise any right of set-off as against any Obligor.
<PAGE>   35
                                       32



         Each Guarantor must hold in trust for and immediately pay or transfer
         to the Facility Agent for the Finance Parties any payment or
         distribution or benefit of security received by it contrary to
         paragraph (a) above or in accordance with any directions given by the
         Facility Agent under paragraph (b) above.

15.8     ADDITIONAL SECURITY

         This guarantee is in addition to and is not in any way prejudiced by
         any other security now or subsequently held by any Finance Party.

16.      REPRESENTATIONS

16.1     REPRESENTATIONS

         The representations set out in this Clause are made by each Obligor or
         (if it so states) the Company to each Finance Party.

16.2     STATUS

(a)      It is a limited liability company, duly incorporated and validly
         existing under the laws of its jurisdiction of incorporation.

(b)      It and each of its Subsidiaries has the power to own its assets and
         carry on its business as it is being conducted.

16.3     POWERS AND AUTHORITY

         It has the power to enter into and perform, and has taken all necessary
         action to authorise the entry into and performance of, the Finance
         Documents to which it is or will be a party and the transactions
         contemplated by those Finance Documents.

16.4     LEGAL VALIDITY

         Subject to the Reservations and to any other general principles of law
         limiting its obligations and referred to in any legal opinion required
         under this Agreement, each Finance Document to which it is a party is
         its legally binding, valid and enforceable obligation.

16.5     NON-CONFLICT

         The entry into and performance by it of, and the transactions
         contemplated by, the Finance Documents do not conflict with:

         (a)      any law or regulation applicable to it;

         (b)      its or any of its Subsidiaries' constitutional documents; or

         (c)      any document which is binding upon it or any of its
                  Subsidiaries or any of its or its Subsidiaries' assets.
<PAGE>   36
                                       33



16.6     NO DEFAULT

(a)      No Default is outstanding or will result from the execution of, or the
         performance of any transaction contemplated by, any Finance Document;
         and

(b)      no other event is outstanding which constitutes a default under any
         document which is binding on it or any of its Subsidiaries or any of
         its or its Subsidiaries' assets to an extent or in a manner which is
         reasonably likely to have a Material Adverse Effect.

16.7     AUTHORISATIONS

         Except for registration of the Security Agreement under the Companies
         Act 1985, all authorisations required by it in connection with the
         entry into, performance, validity and enforceability of, and the
         transactions contemplated by, the Finance Documents have been obtained
         or effected (as appropriate) and are in full force and effect.

16.8     FINANCIAL STATEMENTS

         Its audited financial statements most recently delivered to the
         Facility Agent (which, in the case of the Company at the date of this
         Agreement, are the Original Financial Statements):

         (a)      have been prepared in accordance with accounting principles
                  and practices generally accepted in its jurisdiction of
                  incorporation, consistently applied; and

         (b)      fairly represent its financial condition (consolidated, if
                  applicable) as at the date to which they were drawn up,

         except, in each case, as disclosed to the contrary in those financial
         statements.

16.9     NO MATERIAL ADVERSE CHANGE

         In the case of the Company only, there has been no material adverse
         change in the consolidated financial condition of the Company since the
         date to which the Original Financial Statements were drawn up.

16.10    LITIGATION

         No litigation, arbitration or administrative proceedings are current
         or, to its knowledge, pending or threatened, which, if adversely
         determined, are reasonably likely to have a Material Adverse Effect.

16.11    INFORMATION MEMORANDUM

(a)      In this Subclause, "INFORMATION MEMORANDUM" means the information
         memorandum prepared on behalf of, and approved by, the Company in
         connection with this Agreement.

(b)      In the case of the Company only:

         (i)      the factual information provided by the Company or any member
                  of the Group contained in the Information Memorandum was true
                  and accurate in all material


<PAGE>   37
                                       34



                  respects as at its date or (if appropriate) as at the date (if
                  any) at which it is stated to be given;

         (ii)     the financial projections provided by the Company or any
                  member of the Group contained in the Information Memorandum
                  have been prepared as at its date, on the basis of recent
                  historical information and assumptions believed by the Company
                  to be reasonable;

         (iii)    to the best of its knowledge and belief, after due enquiry,
                  the Information Memorandum did not omit as at its date any
                  information relating to the Group which, if disclosed, would
                  make the Information Memorandum as at its date untrue or
                  misleading in any material respect and which might reasonably
                  be expected materially and adversely to have affected the
                  decision of a Lender when considering whether to provide
                  finance to the Borrowers on the basis of the Finance
                  Documents; and

         (iv)     to the best of its knowledge and belief, after due enquiry, as
                  at the date on which this representation is given, nothing has
                  occurred in relation to the Group since the date of the
                  Information Memorandum which, if disclosed, would make the
                  Information Memorandum untrue or misleading in any material
                  respect and which might reasonably be expected materially and
                  adversely to have affected the decision of a Lender when
                  considering whether to provide finance to the Borrowers on the
                  basis of the Finance Documents.

16.12    ENVIRONMENTAL COMPLIANCE

(a)      It and each of its Subsidiaries:

         (i)      has obtained all requisite Environmental Approvals required
                  for the carrying on of its business as currently conducted;

         (ii)     has at all times complied with the terms and conditions of
                  such Environmental Approvals; and

         (iii)    has at all times complied with all other applicable
                  Environmental Law,

         the failure to obtain or comply with which, in each case, is reasonably
         likely to have a Material Adverse Effect;

(b)      there is no Environmental Claim pending or, to its knowledge,
         threatened against it or any of its Subsidiaries which, if adversely
         determined, is reasonably likely to have a Material Adverse Effect; and

(c)      so far as it is aware, no Dangerous Substance has been used, disposed
         of, generated, stored, transported, dumped, released, deposited, buried
         or emitted at, on, from or under any premises (whether or not owned,
         leased, occupied or controlled by it or any of its Subsidiaries and
         including any off-site waste management or disposal location utilised
         by it or any of its Subsidiaries) in such manner or circumstances as
         are reasonably likely to have a Material Adverse Effect.
<PAGE>   38
                                       35



16.13    TIMES FOR MAKING REPRESENTATIONS

(a)      The representations set out in this Clause (other than the
         representations in Clause 16.11 (Information Memorandum) are made by
         each Original Obligor on the date of this Agreement.

(b)      The representations in Clause 16.11 (Information Memorandum) are made
         by the Company only on the date of the Syndication Agreement.

(c)      Unless a representation is expressed to be given at a specific date,
         each representation is deemed to be repeated by:

         (i)      each Additional Obligor and the Company on the date that
                  Additional Obligor becomes an Obligor; and

         (ii)     each Obligor on the date of each Request and the first day of
                  each Interest Period.

(d)      When a representation is repeated, it is applied to the circumstances
         existing at the time of repetition.

17.      INFORMATION COVENANTS

17.1     FINANCIAL STATEMENTS

(a)      The Company must supply to the Facility Agent in sufficient copies for
         all the Lenders:

         (i)      its audited consolidated financial statements for each of its
                  financial years ending after the date of this Agreement;

         (ii)     the audited financial statements of each Obligor for each of
                  its financial years ending after the date of this Agreement;

         (iii)    the interim management financial statements of the Group for
                  each quarter of each of its financial years ending after the
                  date of this Agreement; and

         (iv)     a budget for the Group for each of its financial years
                  beginning after the date of this Agreement.

(b)      All financial statements must be supplied as soon as they are available
         and:

         (i)      in the case of the Company's audited consolidated financial
                  statements for the financial year ending on 31st March, 2001,
                  210 days (or such longer period as the Majority Lenders may
                  agree);

         (ii)     in the case of the Company's audited consolidated financial
                  statements for subsequent financial years, within 150 days (or
                  such longer period as the Majority Lenders may agree);

         (iii)    in the case of each Obligor's audited financial statements,
                  within 150 days (or such longer period as the Majority Lenders
                  may agree); and
<PAGE>   39
                                       36



         (iv)     in the case of the Group's interim management financial
                  statements, within 45 days (or such longer period as the
                  Majority Lenders may agree),

         of the end of the relevant financial period; and

         (v)      in the case of the annual Group budget, not later than 30 days
                  (or such longer period as the Majority Lenders may agree)
                  after the start of the relevant financial year.

17.2     COMPLIANCE CERTIFICATE

(a)      A "COMPLIANCE CERTIFICATE" is a certificate, substantially in the form
         of Schedule 7 (Form of Compliance Certificate) setting out, among other
         things, calculations of the financial covenants.

(b)      The Company must supply to the Facility Agent a Compliance Certificate:

         (i)      within 45 days after the end of each financial quarter;

         (ii)     within 21 days after the end of each other month; and

         (iii)    with each set of financial statements sent to the Facility
                  Agent under Clause 17.1(a)(i) (Financial Statements).

(c)      A Compliance Certificate must be signed by two authorised signatories
         of the Company.

17.3     FORM OF FINANCIAL STATEMENTS

(a)      The Company must ensure that each set of financial statements supplied
         under this Agreement gives (if audited) a true and fair view of, or (if
         unaudited) fairly represents, the financial condition (consolidated or
         otherwise) of the relevant person as at the date to which those
         financial statements were drawn up.

(b)      The Company must notify the Facility Agent of any change to the basis
         on which its audited consolidated financial statements are prepared if
         that change is either material or might affect the calculation of the
         financial covenants set out in Clause 18 (Financial covenants) and of
         any change to its financial year end.

(c)      If requested by the Facility Agent, the Company must supply to the
         Facility Agent:

         (i)      a full description of any change notified under paragraph (b)
                  above; and

         (ii)     sufficient information to enable the Finance Parties to make a
                  proper comparison between the financial position shown by the
                  set of financial statements prepared on the changed basis and
                  its most recent audited consolidated financial statements
                  delivered to the Facility Agent under this Agreement.

(d)      If requested by the Facility Agent, the Company must enter into
         discussions for a period of not more than 30 days with a view to
         agreeing any amendments required to be made to the financial covenants
         set out in Clause 18 (Financial covenants) to place the Company and the
         Lenders in the same position as they would have been in if the change
         had not happened.



<PAGE>   40
                                       37



         Any agreement between the Company and the Facility Agent will be, with
         the prior consent of the Majority Lenders, binding on all the Parties.

(e)      If no agreement is reached under paragraph (d) above on the required
         amendments to this Agreement, the Company must ensure that its auditors
         confirm the appropriateness of those amendments; the confirmation of
         the auditors will be, in the absence of manifest error, binding on all
         the Parties.

17.4     INFORMATION - MISCELLANEOUS

         The Company must supply to the Facility Agent:

         (a)      copies of all documents despatched by the Company to its
                  creditors generally at the same time as they are despatched;

         (b)      promptly upon becoming aware of them, details of any
                  litigation, arbitration or administrative proceedings which
                  are current, threatened or pending and which might, if
                  adversely determined, have a Material Adverse Effect;

         (c)      promptly on request, a list of the then current Material
                  Subsidiaries; and

         (d)      promptly on request, such further information regarding the
                  financial condition and operations of the Group as any Finance
                  Party through the Facility Agent may reasonably request.

17.5     NOTIFICATION OF DEFAULT

(a)      Unless the Facility Agent has already been so notified by another
         Obligor, each Obligor must notify the Facility Agent of any Default
         (and the steps, if any, being taken to remedy it) promptly upon
         becoming aware of its occurrence.

(b)      Promptly on request by the Facility Agent at any time when the Facility
         Agent reasonably believes a Default is outstanding, the Company must
         supply to the Facility Agent a certificate, signed by two of its
         authorised signatories on its behalf, certifying that no Default is
         outstanding or, if a Default is outstanding, specifying the Default and
         the steps, if any, being taken to remedy it. The request from the
         Facility Agent must include reasonable details of why the Facility
         Agent believes a Default is outstanding.

18.      FINANCIAL COVENANTS

18.1     DEFINITIONS

         In this Clause:

         "CONSOLIDATED CASH AND CASH EQUIVALENTS"

         means, at any time:

         (a)      cash in hand or on deposit with any acceptable bank, which, in
                  either case, is remittable to the U.K.;
<PAGE>   41
                                       38



         (b)      certificates of deposit, maturing within one year after the
                  relevant date of calculation, issued by an acceptable bank;

         (c)      any investment in marketable obligations issued or guaranteed
                  by the government of the U.S.A. or the U.K. or by an
                  instrumentality or agency of the government of the U.S.A. or
                  the U.K. having an equivalent credit rating; or

         (d)      any other instrument, security or investment approved by the
                  Majority Lenders,

         in each case, to which any member of the Group is beneficially entitled
         at that time and which is capable of being applied against Consolidated
         Total Borrowings. An "ACCEPTABLE BANK" for this purpose is a commercial
         bank or trust company which has a rating of A or higher by Standard &
         Poor's or FitchIBCA or A2 or higher by Moody's or a comparable rating
         from a nationally recognised credit rating agency for its long-term
         debt obligations.

         "CONSOLIDATED EBIT"

         means the consolidated net pre-taxation profits of the Group for a
         Measurement Period, adjusted by:

         (a)      adding back Consolidated Interest Payable;

         (b)      taking no account of any exceptional or extraordinary item;
                  and

         (c)      deducting any amount attributable to minority interests.

         "CONSOLIDATED INTEREST PAYABLE"

         means all interest and periodic financing charges including arrangement
         fees, acceptance commission, commitment fee and the interest element of
         rental payments or finance or capital leases (whether, in each case,
         paid, payable or capitalised) incurred by the Group in effecting,
         servicing or maintaining Consolidated Total Borrowings during a
         Measurement Period.

         "CONSOLIDATED NET INTEREST PAYABLE"

         means Consolidated Interest Payable less all financing charges received
         or receivable by the Group during the relevant Measurement Period.

         "CONSOLIDATED TANGIBLE NET WORTH"

         means at any time the aggregate of:

         (a)      the amount paid up or credited as paid up on the issued share
                  capital of the Company; and

         (b)      the amount standing to the credit of the consolidated capital
                  and revenue reserves (including, without limitation, retained
                  earnings and, subject to sub-paragraph (v) below, revaluation
                  reserves) of the Group,
<PAGE>   42
                                       39



         based on the latest published audited consolidated balance sheet of the
         Company (the "LATEST BALANCE SHEET") but adjusted by:

         (i)      adding any amount standing to the credit of the profit and
                  loss account of the Group for the period ending on:

                  (A)      the date of the latest balance sheet; and

                  (B)      to the extent not included in sub-paragraph (A)
                           above, the date to which the financial statements
                           most recently provided to the Facility Agent under
                           Clause 17.1 (Financial Statements) were made up;

         (ii)     deducting:

                  (A)      any dividend or other distribution declared,
                           recommended or made by any member of the Group; and

                  (B)      the amount of any:

                           (I)      loans or other forms of credit made by the
                                    Company to; or

                           (II)     guarantees by the Company of the obligations
                                    of,

                           its Holding Company or any Affiliate of its Holding
                           Company (other than the Obligors), which, in
                           aggregate, exceed pound sterling 1,000,000;

         (iii)    deducting any amount standing to the debit of the profit and
                  loss account of the Group for the period ending on:

                  (A)      the date of the latest balance sheet; and

                  (B)      to the extent not included in sub-paragraph (A)
                           above, the date to which the financial statements
                           most recently provided to the Facility Agent under
                           Clause 17.1 (Financial Statements) were made up.

         (iv)     deducting any amount attributable to goodwill or any other
                  intangible asset;

         (v)      deducting any amount attributable to an upward revaluation of
                  assets after 31st March, 2000 or, in the case of assets of a
                  company which becomes a member of the Group after that date,
                  the date on which that company becomes a member of the Group
                  other than an upward revaluation which is supported by an
                  independent professional valuation;

         (vi)     reflecting any variation in the amount of the issued share
                  capital of the Company and the consolidated capital and
                  revenue reserves of the Group after the date of the latest
                  balance sheet;

         (vii)    reflecting any variation in the interest of the Company in any
                  other member of the Group since the date of the latest balance
                  sheet;

<PAGE>   43
                                       40



         (viii)   excluding any amount attributable to deferred taxation; and

         (ix)     excluding any amount attributable to minority interests.

         "CONSOLIDATED TOTAL BORROWINGS"

         means, in respect of the Group, at any time the aggregate of the
         following:

         (a)      the outstanding principal amount of any moneys borrowed;

         (b)      the outstanding principal amount of any acceptance under any
                  acceptance credit;

         (c)      the outstanding principal amount of any bond (other than
                  performance bonds), note, debenture, loan stock or other
                  similar instrument;

         (d)      the capitalised element of indebtedness under a finance or
                  capital lease;

         (e)      the outstanding principal amount of all moneys owing in
                  connection with the sale or discounting of receivables
                  (otherwise than on a non-recourse basis);

         (f)      the outstanding principal amount of any indebtedness arising
                  from any deferred payment agreements (other than Deferred
                  Purchase Agreements entered into in the ordinary course of
                  trading which are not arranged primarily as a method of
                  raising finance or financing the acquisition of land) arranged
                  primarily as a method of raising finance or financing the
                  acquisition of an asset;

         (g)      any fixed or minimum premium payable on the repayment or
                  redemption of any instrument referred to in paragraph (c)
                  above;

         (h)      the outstanding principal amount of any indebtedness arising
                  in connection with any other transaction (including any
                  forward sale or purchase agreement) which has the commercial
                  effect of a borrowing; and

         (i)      the outstanding principal amount of any indebtedness of any
                  person of a type referred to in paragraphs (a) - (h) above
                  which is the subject of a guarantee, indemnity or similar
                  assurance against financial loss given by a member of the
                  Group.

         Any amount outstanding in a currency other than Sterling is to be taken
         into account at its Sterling equivalent calculated on the basis of:

         (i)      the Facility Agent's spot rate of exchange for the purchase of
                  the relevant currency in the London foreign exchange market
                  with Sterling at or about 11.00 a.m. on the day the relevant
                  amount falls to be calculated; or

         (ii)     if the amount is to be calculated on the last day of a
                  financial period of the Company, the rate of exchange used by
                  the Company in its financial statements for that period.
<PAGE>   44
                                       41



         "CONSOLIDATED TOTAL NET BORROWINGS"

         means at any time Consolidated Total Borrowings less Consolidated Cash
         and Cash Equivalents.

         "MEASUREMENT PERIOD"

         means a period of 12 months ending on the last day of a financial
         quarter of the Company.

18.2     INTERPRETATION

(a)      Except as provided to the contrary in this Agreement, an accounting
         term used in this Clause is to be construed in accordance with the
         Applicable Principles.

(b)      No item must be credited or deducted more than once in any calculation
         under this Clause.

18.3     CONSOLIDATED TANGIBLE NET WORTH

         The Company must ensure that Consolidated Tangible Net Worth is not at
         any time less than pound sterling 110,000,000.

18.4     GEARING

         The Company must ensure that Consolidated Total Net Borrowings do not
         at any time exceed 100 per cent. of Consolidated Tangible Net Worth at
         that time.

18.5     INTEREST COVER/CASHFLOW

         The Company must ensure that the ratio of Consolidated EBIT for a
         Measurement Period to Consolidated Net Interest Payable for that
         Measurement Period is not, at the end of that Measurement Period, less
         than 2.5 to 1.

18.6     RESTRICTION ON DIVIDEND

         The Company must ensure that the aggregate amount of dividends or other
         distributions paid by it to its immediate Holding Company in any
         financial year does not exceed the aggregate of:

         (a)      the Company's net post-taxation profits for that financial
                  year; and

         (b)      to the extent those profits have not previously been
                  distributed and form part of the Company's retained earnings
                  reserve, the Company's net post-taxation profits from previous
                  financial years.

<PAGE>   45

19.      GENERAL COVENANTS

19.1     GENERAL

         Each Obligor agrees to be bound by the covenants set out in this Clause
         relating to it and, where the covenant is expressed to apply to each
         member of the Group, each Obligor must ensure that each of its
         Subsidiaries performs that covenant.

19.2     AUTHORISATIONS

         Each Obligor must promptly obtain, maintain and comply with the terms
         of any authorisation required under any law or regulation to enable it
         to perform its obligations under, or for the validity or enforceability
         of, any Finance Document.

19.3     COMPLIANCE WITH LAWS

         Each member of the Group must comply in all respects with all laws to
         which it is subject where failure to do so is reasonably likely to have
         a Material Adverse Effect.

19.4     PARI PASSU RANKING

         Each Obligor must ensure that its payment obligations under the Finance
         Documents rank at least pari passu with all its other present and
         future unsecured payment obligations, except for obligations
         mandatorily preferred by law applying to companies generally.

19.5     NEGATIVE PLEDGE

(a)      Except as provided below, no member of the Group may create or allow to
         exist any Security Interest on any of its assets.

(b)      Paragraph (a) does not apply to:

         (i)      any Security Interest created by a Security Document;

         (ii)     any Security Interest listed in Schedule 6 (Existing Security)
                  except to the extent the principal amount secured by that
                  Security Interest exceeds the amount stated in that Schedule;

         (iii)    any Security Interest arising out of retention of title
                  provisions in a supplier's standard conditions of supply of
                  goods;

         (iv)     any Security Interest comprising a netting or set-off
                  arrangement entered into by a member of the Group in the
                  ordinary course of its banking arrangements for the purpose of
                  netting debit and credit balances;

         (v)      any lien arising by operation of law and in the ordinary
                  course of trading;

         (vi)     any Security Interest on an asset, or an asset of any person,
                  acquired by a member of the Group after the date of this
                  Agreement but only for the period of six months from the date
                  of acquisition and to the extent that the principal amount
                  secured by that

<PAGE>   46
                                       43



                  Security Interest has not been incurred or increased in
                  contemplation of, or since, the acquisition; and

         (vii)    any Security Interest securing consideration payable by a
                  member of the Group under a Deferred Purchase Agreement the
                  amount of which (when aggregated with the amount of any other
                  consideration which has the benefit of a Security Interest
                  allowed under this sub-paragraph (vii)) does not exceed 20 per
                  cent. of Consolidated Tangible Net Worth or its equivalent in
                  any other currency at any time.

(c)      No member of the Group may:

         (i)      sell, transfer or otherwise dispose of any of its assets on
                  terms where it is or may be leased to or re-acquired or
                  acquired by a member of the Group or any of its related
                  entities; or

         (ii)     sell, transfer or otherwise dispose of any of its receivables
                  on recourse terms,

         in circumstances where the transaction is entered into primarily as a
         method of raising Financial Indebtedness or of financing the
         acquisition of an asset.

19.6     DISPOSALS

(a)      Except as provided below, no member of the Group may, either in a
         single transaction or in a series of transactions and whether related
         or not, dispose of all or any part of its assets.

(b)      Paragraph (a) does not apply to any disposal:

         (i)      made in the ordinary course of trading of the disposing
                  entity;

         (ii)     of assets in exchange for other assets comparable or superior
                  as to type, value and quality; or

         (iii)    where the higher of the market value or consideration
                  receivable (when aggregated with the higher of the market
                  value or consideration for any other disposal not allowed
                  under the preceding sub-paragraphs) in any financial year of
                  the Company does not exceed five per cent. of Consolidated
                  Tangible Net Worth as at the end of the preceding financial
                  year or its equivalent in any other currency.

19.7     FINANCIAL INDEBTEDNESS

(a)      Except as provided below, no member of the Group may incur or allow to
         exist any Financial Indebtedness.

(b)      Paragraph (a) does not apply to:

         (i)      Financial Indebtedness incurred under Deferred Purchase
                  Agreements;

         (ii)     Financial Indebtedness incurred under the Finance Documents;
<PAGE>   47
                                       44



         (iii)    Financial Indebtedness owed to Affiliates provided that any
                  amount of such Financial Indebtedness which exceeds pound
                  sterling 1,000,000 in aggregate matures after the Final
                  Maturity Date;

         (iv)     any Financial Indebtedness of any person acquired by a member
                  of the Group which is incurred under arrangements in existence
                  at the date of acquisition, but only for a period of six
                  months from the date of acquisition;

         (v)      any derivative transaction protecting against or benefiting
                  from fluctuations in any rate or price entered into in the
                  ordinary course of business of the Group;

         (vi)     an overdraft facility not exceeding pound sterling 5,000,000
                  on a net basis provided by National Westminster Bank Plc;

         (vii)    Financial Indebtedness relating to the issue of performance
                  bonds, guarantees and similar instruments under a bonding line
                  made available by National Westminster Bank Plc, up to an
                  aggregate amount not exceeding pound sterling 5,000,000;

         (viii)   Financial Indebtedness in connection with the RBS Promissory
                  Note (as defined in the Security Agreement) provided that such
                  Financial Indebtedness is repaid in full on or before 2nd
                  April, 2001; or

         (ix)     Financial Indebtedness which in aggregate does not exceed
                  pound sterling 1,000,000 or its equivalent at any time.

19.8     LENDING AND GUARANTEES

         No member of the Group may, make any loans or any form of credit or
         give any guarantee or indemnity to or for the benefit of any person in
         respect of any obligation for Financial Indebtedness of any person
         other than:

         (a)      to another member of the Group;

         (b)      in respect of Financial Indebtedness of a member of the Group;
                  or

         (c)      provided that no breach of Clause 18.3 (Consolidated Tangible
                  Net Worth) is then outstanding or would result, loans from the
                  Company to its Holding Company or any Affiliate of its Holding
                  Company,

         which in each case is permitted under Clause 19.7(b) (Financial
         Indebtedness) and in respect of which all relevant legislation relating
         to financial assistance has been complied with.

19.9     CHANGE OF BUSINESS

         The Company must ensure that no substantial change is made to the
         general nature of the business of the Company or the Group from that
         carried on at the date of this Agreement.
<PAGE>   48
                                       45



19.10    MERGERS

         No Obligor may enter into any amalgamation, demerger, merger or
         reconstruction otherwise than under an intra-Group re-organisation on a
         solvent basis or other transaction agreed by the Majority Lenders.

19.11    ACQUISITIONS

(a)      Except as provided below, no member of the Group may make any
         acquisition or investment.

(b)      Paragraph (a) does not apply to:

         (i)      acquisitions or investments made in the ordinary course of
                  trade or which are ancillary to the trading operations of the
                  Group; or

         (ii)     acquisitions where the consideration (when aggregated with the
                  consideration of any other acquisition not allowed under the
                  preceding sub-paragraphs) in any financial year of the Company
                  does not exceed 20 per cent. of Consolidated Tangible Net
                  Worth as at the end of the preceding financial year or its
                  equivalent in any other currency.

19.12    ENVIRONMENTAL MATTERS

(a)      Each member of the Group must ensure that it is, and has been, in
         compliance with all Environmental Law and Environmental Approvals
         applicable to it, where failure to do so is reasonably likely to have a
         Material Adverse Effect.

(b)      Each member of the Group must promptly upon becoming aware notify the
         Facility Agent of:

         (i)      any Environmental Claim current, or to its knowledge, pending
                  or threatened; or

         (ii)     any circumstances reasonably likely to result in an
                  Environmental Claim,

         which, if substantiated, is reasonably likely either to have a Material
         Adverse Effect or result in any liability for a Finance Party.

19.13    INSURANCE

         Each member of the Group must insure its business and assets with
         insurance companies to such an extent and against such risks as
         companies engaged in a similar business normally insure.

20.      DEFAULT

20.1     EVENTS OF DEFAULT

(a)      Each of the events set out in this Clause is an Event of Default.

(b)      In this Clause:
<PAGE>   49
                                       46



         "PERMITTED TRANSACTION" means:

         (i)      an intra-Group re-organisation of a member of the Group which
                  is not an Obligor on a solvent basis; or

         (ii)     any other transaction agreed to by the Majority Lenders.

20.2     NON-PAYMENT

         An Obligor does not pay on the due date any amount payable by it under
         the Finance Documents in the manner required under the Finance
         Documents, unless the non-payment:

         (a)      is caused by technical or administrative error; and

         (b)      is remedied within three Business Days of the due date.

20.3     BREACH OF OTHER OBLIGATIONS

(a)      An Obligor does not comply with any term of Clause 18 (Financial
         covenants), Clause 19.5 (Negative Pledge), Clause 19.6 (Disposals),
         Clause 19.7 (Financial Indebtedness) or Clause 19.8 (Lending and
         guarantees); or

(b)      an Obligor does not comply with any other term of the Finance Documents
         not already referred to in this Clause or in Clause 20.2 (Non-payment),
         unless the non-compliance:

         (i)      is capable of remedy; and

         (ii)     is remedied within 21 days of the earlier of the Facility
                  Agent giving notice and the Obligor becoming aware of the
                  non-compliance.

20.4     MISREPRESENTATION

         A representation made or repeated by an Obligor in any Finance Document
         or in any document delivered by or on behalf of any Obligor under any
         Finance Document is incorrect in any material respect when made or
         deemed to be repeated unless the misrepresentation:

         (i)      is capable of remedy; and

         (ii)     is remedied within 21 days of the earlier of the Facility
                  Agent giving notice and the Obligor becoming aware of the
                  misrepresentation.

20.5     CROSS-DEFAULT

         Any of the following occurs in respect of a member of the Group:

         (a)      any of its Financial Indebtedness is not paid when due (after
                  the expiry of any originally applicable grace period);

         (b)      any of its Financial Indebtedness:
<PAGE>   50
                                       47



                  (i)      becomes prematurely due and payable;

                  (ii)     is placed on demand; or

                  (iii)    is capable of being declared by a creditor to be
                           prematurely due and payable or being placed on
                           demand,

         in each case, as a result of an event of default (howsoever described);
         or

         (c)      any commitment for its Financial Indebtedness is cancelled or
                  suspended as a result of an event of default (howsoever
                  described),

         unless the aggregate amount of Financial Indebtedness falling within
         paragraphs (a)-(c) above is less than pound sterling 1,000,000 or its
         equivalent.

20.6     INSOLVENCY

         Any of the following occurs in respect of a member of the Group:

         (a)      it is, or is deemed for the purposes of any law to be, unable
                  to pay its debts as they fall due or insolvent;

         (b)      it admits its inability to pay its debts as they fall due;

         (c)      it suspends making payments on any of its debts or announces
                  an intention to do so;

         (d)      by reason of actual or anticipated financial difficulties, it
                  begins negotiations with any creditor for the rescheduling of
                  any of its indebtedness; or

         (e)      a moratorium is declared in respect of any of its
                  indebtedness.

20.7     INSOLVENCY PROCEEDINGS

(a)      Except as provided below, any of the following occurs in respect of a
         member of the Group:

         (i)      any step is taken with a view to a composition, assignment or
                  similar arrangement with any of its creditors generally or any
                  class of its creditors;

         (ii)     a meeting of it is convened for the purpose of considering any
                  resolution for (or to petition for) its winding-up,
                  administration or dissolution or any such resolution is
                  passed;

         (iii)    any person presents a petition for its winding-up,
                  administration or dissolution;

         (iv)     an order for its winding-up, administration or dissolution is
                  made;

         (v)      any liquidator, trustee in bankruptcy, judicial custodian,
                  compulsory manager, receiver, administrative receiver,
                  administrator or similar officer is appointed in respect of it
                  or any of its assets;
<PAGE>   51
                                       48



         (vi)     its directors or other officers request the appointment of a
                  liquidator, trustee in bankruptcy, judicial custodian,
                  compulsory manager, receiver, administrative receiver,
                  administrator or similar officer; or

         (vii)    any other analogous step or procedure is taken in any
                  jurisdiction.

(b)      Paragraph (a) does not apply to:

         (i)      any step or procedure which is part of a Permitted
                  Transaction; or

         (ii)     a petition for winding-up presented by a creditor which is
                  being contested in good faith and with due diligence and is
                  discharged or struck out within 28 days.

20.8     CREDITORS' PROCESS

         Any attachment, sequestration, distress, execution or analogous event
         affects any asset(s) of a member of the Group, having an aggregate
         value of pound sterling 1,000,000, and is not discharged within 28
         days.

20.9     CESSATION OF BUSINESS

         A member of the Group ceases, or threatens to cease, to carry on
         business except:

         (a)      as part of a Permitted Transaction; or

         (b)      as a result of any disposal allowed under this Agreement.

20.10    EFFECTIVENESS OF FINANCE DOCUMENTS

(a)      It is or becomes unlawful for any Obligor to perform any of its
         obligations under the Finance Documents.

(b)      Any Finance Document is not effective for any reason arising after the
         date of this Agreement which is not remediable by an Obligor complying
         with its obligations under Clause 19.2 (Authorisations), 19.3
         (Compliance with laws) or 19.4 (Pari passu ranking) or clause 13
         (Further assurances) of the Security Agreement or is alleged by an
         Obligor to be ineffective for any reason.

(c)      An Obligor repudiates a Finance Document or evidences an intention to
         repudiate a Finance Document.

20.11    OWNERSHIP OF THE OBLIGORS

(a)      An Obligor (other than the Company) is not or ceases to be a
         wholly-owned Subsidiary of the Company.

(b)      The Company ceases to be at least 90 per cent. owned (directly or
         indirectly) by Centex Development Company, L.P or the equity interests
         in Centex Development Company, L.P. cease to be traded in tandem with
         those of Centex Corporation.
<PAGE>   52
                                       49



20.12    MATERIAL ADVERSE CHANGE

         Any event or series of events occurs which is reasonably likely to have
         a Material Adverse Effect.

20.13    ACCELERATION

         If an Event of Default is outstanding, the Facility Agent may, by
         notice to the Company:

         (a)      cancel the Total Commitments; and/or

         (b)      declare that all or part of any amounts outstanding under the
                  Finance Documents are:

                  (i)      immediately due and payable; and/or

                  (ii)     payable on demand by the Facility Agent acting on the
                           instructions of the Majority Lenders.

         Any notice given under this Subclause will take effect in accordance
         with its terms.

21.      SECURITY

21.1     FACILITY AGENT AS TRUSTEE

         Unless expressly provided to the contrary, the Facility Agent holds any
         security created by a Security Document on trust for the Finance
         Parties.

21.2     RESPONSIBILITY

         The Facility Agent is not responsible to any other Finance Party for
         any failure in perfecting or protecting the security created by any
         Security Document unless directly caused by its gross negligence or
         wilful misconduct.

21.3     TITLE

         The Facility Agent may accept, without enquiry, the title (if any) an
         Obligor may have to any asset over which security is intended to be
         created by any Security Document.

21.4     POSSESSION OF DOCUMENTS

         The Facility Agent is not obliged to hold in its own possession any
         Security Document, title deed or other document in connection with any
         asset over which security is intended to be created by a Security
         Document.

21.5     INVESTMENTS

         Except as otherwise provided in any Security Document, all moneys
         received by the Facility Agent under a Security Document may be
         invested in the name of, or under the control of, the Facility Agent in
         any investments selected by the Facility Agent. Additionally, those
         moneys



<PAGE>   53
                                       50



         may be placed on deposit in the name of, or under the control of, the
         Facility Agent at any bank or institution (including itself) and upon
         such terms as it may think fit.

21.6     APPROVAL

         Each Finance Party confirms its approval of each Security Document.

21.7     RELEASE OF SECURITY

(a)      If:


         (i)      a Guarantor ceases to be a member of the Group; or

         (ii)     a Guarantor is released from all its obligations under the
                  Finance Documents,

         in a manner allowed by this Agreement, any security created by that
         Guarantor over its assets under the Security Documents will be
         released.

(b)      If a disposal of any asset subject to security created by a Security
         Document is made to a person (which is and will remain) outside the
         Group in the following circumstances:

         (i)      the Majority Lenders agree to the disposal;

         (ii)     the disposal is allowed by the terms of the Finance Documents
                  and will not result or could not reasonably be expected to
                  result in any breach of any term of any Finance Document;

         (iii)    the disposal is being made at the request of the Facility
                  Agent in circumstances where any security created by the
                  Security Documents has become enforceable; or

         (iv)     the disposal is being effected by enforcement of a Security
                  Document,

         the asset being disposed of will be released from any security over it
         created by a Security Document. However, the proceeds of any disposal
         (or an amount corresponding to them) must be applied in accordance with
         the requirements of the Finance Documents (if any).

(c)      If the Facility Agent is satisfied that a release is allowed under this
         Subclause, the Facility Agent must execute (at the request and expense
         of the relevant Obligor) any document which is reasonably required to
         achieve that release. Each other Finance Party irrevocably authorises
         the Facility Agent to execute any such document.

21.8     LETTERS OF NON-CRYSTALLISATION

         If a disposal of any asset subject to a floating charge created by a
         Security Document is made to a person which is (and will remain)
         outside the Group in the following circumstances:

         (a)      the disposal is allowed by the terms of the Finance Documents
                  and will not result or could not reasonably be expected to
                  result in any breach of any term of the Finance Documents;
<PAGE>   54
                                       51



         (b)      the floating charge to which the asset is subject has not
                  crystallised; and

         (c)      the Majority Banks have not instructed the Facility Agent
                  otherwise,

         the Facility Agent must provide (at the request and expense of the
         Company) to the Company a Letter of Non-Crystallisation and/or a Deed
         of Partial Release. Each other Finance Party irrevocably authorises the
         Facility Agent to execute those documents.

22.      THE ADMINISTRATIVE PARTIES

22.1     APPOINTMENT AND DUTIES OF THE FACILITY AGENT

(a)      Each Finance Party (other than the Facility Agent) irrevocably appoints
         the Facility Agent to act as its agent under the Finance Documents.

(b)      Each Finance Party irrevocably authorises the Facility Agent to:

         (i)      perform the duties and to exercise the rights, powers and
                  discretions that are specifically given to it under the
                  Finance Documents, together with any other incidental rights,
                  powers and discretions; and

         (ii)     execute each Finance Document expressed to be executed by the
                  Facility Agent.

(c)      The Facility Agent has only those duties which are expressly specified
         in the Finance Documents. Those duties are solely of a mechanical and
         administrative nature.

22.2     ROLE OF THE ARRANGER

         Except as specifically provided in the Finance Documents, the Arranger
         has no obligations of any kind to any other Party in connection with
         any Finance Document.

22.3     NO FIDUCIARY DUTIES

         Except as specifically provided in a Finance Document, nothing in the
         Finance Documents makes an Administrative Party a trustee or fiduciary
         for any other Party or any other person. No Administrative Party need
         hold in trust any moneys paid to it for a Party or be liable to account
         for interest on those moneys.

22.4     INDIVIDUAL POSITION OF AN ADMINISTRATIVE PARTY

(a)      If it is also a Lender, each Administrative Party has the same rights
         and powers under the Finance Documents as any other Lender and may
         exercise those rights and powers as though it were not an
         Administrative Party.

(b)      Each Administrative Party may:

         (i)      carry on any business with any Obligor or its related entities
                  (including acting as an agent or a trustee for any other
                  financing); and
<PAGE>   55
                                       52



         (ii)     retain any profits or remuneration it receives under the
                  Finance Documents or in relation to any other business it
                  carries on with any Obligor or its related entities.

22.5     RELIANCE

         The Facility Agent may:

         (a)      rely on any notice or document believed by it to be genuine
                  and correct and to have been signed by, or with the authority
                  of, the proper person;

         (b)      rely on any statement made by any person regarding any matters
                  which may reasonably be assumed to be within his knowledge or
                  within his power to verify;

         (c)      engage, pay for and rely on professional advisers selected by
                  it (including those representing a Party other than the
                  Facility Agent); and

         (d)      act under the Finance Documents through its personnel and
                  agents.

22.6     MAJORITY LENDERS' INSTRUCTIONS

(a)      The Facility Agent is fully protected if it acts on the instructions of
         the Majority Lenders in the exercise of any right, power or discretion
         or any matter not expressly provided for in the Finance Documents. Any
         such instructions given by the Majority Lenders will be binding on all
         the Lenders. In the absence of instructions, the Facility Agent may act
         as it considers to be in the best interests of all the Lenders.

(b)      The Facility Agent is not authorised to act on behalf of a Lender
         (without first obtaining that Lender's consent) in any legal or
         arbitration proceedings in connection with any Finance Document.

(c)      The Facility Agent may require the receipt of security satisfactory to
         it, whether by way of payment in advance or otherwise, against any
         liability or loss which it may incur in complying with the instructions
         of the Majority Lenders.

22.7     RESPONSIBILITY

(a)      No Administrative Party is responsible to any other Finance Party for
         the adequacy, accuracy or completeness of:

         (i)      any Finance Document or any other document; or

         (ii)     any statement or information (whether written or oral) made in
                  or supplied in connection with any Finance Document.

(b)      Without affecting the responsibility of any Obligor for information
         supplied by it or on its behalf in connection with any Finance
         Document, each Lender confirms that it:

         (i)      has made, and will continue to make, its own independent
                  appraisal of all risks arising under or in connection with the
                  Finance Documents (including the financial


<PAGE>   56
                                       53


                  condition and affairs of each Obligor and its related entities
                  and the nature and extent of any recourse against any Party or
                  its assets); and

         (ii)     has not relied exclusively on any information provided to it
                  by any Administrative Party in connection with any Finance
                  Document.

22.8     EXCLUSION OF LIABILITY

(a)      The Facility Agent is not liable to any other Finance Party for any
         action taken or not taken by it in connection with any Finance
         Document, unless directly caused by its gross negligence or wilful
         misconduct.

(b)      No Party may take any proceedings against any officer, employee or
         agent of the Facility Agent in respect of any claim it might have
         against the Facility Agent or in respect of any act or omission of any
         kind by that officer, employee or agent in connection with any Finance
         Document. Any officer, employee or agent of the Facility Agent may rely
         on this Subclause and enforce its terms under the Contracts (Rights of
         Third Parties) Act 1999.

22.9     DEFAULT

(a)      The Facility Agent is not obliged to monitor or enquire whether a
         Default has occurred. The Facility Agent is not deemed to have
         knowledge of the occurrence of a Default.

(b)      If the Facility Agent:

         (i)      receives notice from a Party referring to this Agreement,
                  describing a Default and stating that the event is a Default;
                  or

         (ii)     is aware of the non-payment of any principal or interest or
                  any fee payable to a Lender under this Agreement,

         it must promptly notify the Lenders.

22.10    INFORMATION

(a)      The Facility Agent must promptly forward to the person concerned the
         original or a copy of any document which is delivered to the Facility
         Agent by a Party for that person.

(b)      Except where a Finance Document specifically provides otherwise, the
         Facility Agent is not obliged to review or check the adequacy, accuracy
         or completeness of any document it forwards to another Party.

(c)      Except as provided above, the Facility Agent has no duty:

         (i)      either initially or on a continuing basis to provide any
                  Lender with any credit or other information concerning the
                  risks arising under or in connection with the Finance
                  Documents (including any information relating to the financial
                  condition or affairs of any Obligor or its related entities or
                  the nature or extent of recourse against any Party or its
                  assets) whether coming into its possession before, on or after
                  the date of this Agreement; or
<PAGE>   57
                                       54



         (ii)     unless specifically requested to do so by a Lender in
                  accordance with a Finance Document, to request any certificate
                  or other document from any Obligor.

(d)      In acting as the Facility Agent, the agency division of the Facility
         Agent is treated as a separate entity from its other divisions and
         departments. Any information acquired by the Facility Agent which, in
         its opinion, is acquired by it otherwise than in its capacity as the
         Facility Agent may be treated as confidential by the Facility Agent and
         will not be treated as information possessed by the Facility Agent in
         its capacity as such.

(e)      Each Obligor irrevocably authorises the Facility Agent to disclose to
         the other Finance Parties any information which, in its opinion, is
         received by it in its capacity as the Facility Agent.

22.11    INDEMNITIES

(a)      Without limiting the liability of any Obligor under the Finance
         Documents, each Lender must indemnify the Facility Agent for that
         Lender's Pro Rata Share of any loss or liability incurred by the
         Facility Agent in acting as the Facility Agent, except to the extent
         that the loss or liability is caused by the Facility Agent's gross
         negligence or wilful misconduct.

(b)      The Facility Agent may deduct from any amount received by it for a
         Lender any amount due to the Facility Agent from that Lender under a
         Finance Document but unpaid.

22.12    COMPLIANCE

         The Facility Agent may refrain from doing anything (including
         disclosing any information) which might, in its opinion, constitute a
         breach of any law or regulation or be otherwise actionable at the suit
         of any person, and may do anything which, in its opinion, is necessary
         or desirable to comply with any law or regulation.

22.13    RESIGNATION OF THE FACILITY AGENT

(a)      The Facility Agent may resign and appoint any of its Affiliates as
         successor Facility Agent by giving notice to the Lenders and the
         Company.

(b)      Alternatively, the Facility Agent may resign by giving notice to the
         Lenders and the Company, in which case the Majority Lenders may with
         the prior consent of the Company (not to be unreasonably withheld or
         delayed and, if not expressly refused within 10 Business Days of
         request, deemed to be given) appoint a successor Facility Agent.

(c)      If no successor Facility Agent has been appointed under paragraph (b)
         above within 30 days after notice of resignation was given, the
         Facility Agent may appoint a successor Facility Agent.

(d)      The person(s) appointing a successor Facility Agent must, if
         practicable, consult with the Company prior to the appointment. Any
         successor Facility Agent must have an office in the U.K.

(e)      The resignation of the Facility Agent and the appointment of any
         successor Facility Agent will both become effective only when the
         successor Facility Agent notifies all the Parties that it accepts its
         appointment. On giving the notification, the successor Facility Agent
         will


<PAGE>   58
                                       55


         succeed to the position of the Facility Agent and the term "FACILITY
         AGENT" will mean the successor Facility Agent.

(f)      The retiring Facility Agent must, at its own cost, make available to
         the successor Facility Agent such documents and records and provide
         such assistance as the successor Facility Agent may reasonably request
         for the purposes of performing its functions as the Facility Agent
         under the Finance Documents.

(g)      Upon its resignation becoming effective, this Clause will continue to
         benefit the retiring Facility Agent in respect of any action taken or
         not taken by it in connection with the Finance Documents while it was
         the Facility Agent, and, subject to paragraph (f) above, it will have
         no further obligations under any Finance Document.
(h)      The Majority Lenders may, by notice to the Facility Agent after
         consultation with the Facility Agent and the Company, require it to
         resign under paragraph (b) above.

22.14    RELATIONSHIP WITH LENDERS

(a)      The Facility Agent may treat each Lender as a Lender, entitled to
         payments under this Agreement and as acting through its Facility
         Office(s) until it has received not less than five Business Days' prior
         notice from that Lender to the contrary.

(b)      The Facility Agent may at any time, and must if requested to do so by
         the Majority Lenders, convene a meeting of the Lenders.

(c)      The Facility Agent must keep a register of all the Parties and supply
         any other Party with a copy of the register on request. The register
         will include each Lender's Facility Office(s) and contact details for
         the purposes of this Agreement.

22.15    FACILITY AGENT'S MANAGEMENT TIME

         If the Facility Agent requires, any amount payable to the Facility
         Agent by any Party under any indemnity or in respect of any costs or
         expenses incurred by the Facility Agent under the Finance Documents
         after the date of this Agreement may include the cost of using its
         management time or other resources and will be calculated on the basis
         of such reasonable daily or hourly rates as the Facility Agent may
         notify to the relevant Party. This is in addition to any amount in
         respect of fees or expenses paid or payable to the Facility Agent under
         any other term of the Finance Documents.

22.16    NOTICE PERIOD

         Where this Agreement specifies a minimum period of notice to be given
         to the Facility Agent, the Facility Agent may, at its discretion,
         accept a shorter notice period.
<PAGE>   59
                                       56



23.      EVIDENCE AND CALCULATIONS

23.1     ACCOUNTS

         Accounts maintained by a Finance Party in connection with this
         Agreement are prima facie evidence of the matters to which they relate
         for the purpose of any litigation or arbitration proceedings.

23.2     CERTIFICATES AND DETERMINATIONS

         Any certification or determination by a Finance Party of a rate or
         amount under the Finance Documents will be, in the absence of manifest
         error, prima facie evidence of the matters to which it relates.

23.3     CALCULATIONS

         Any interest or fee accruing under this Agreement accrues from day to
         day and is calculated on the basis of the actual number of days elapsed
         and a year of 365 days or otherwise, depending on what the Facility
         Agent determines is market practice.

24.      FEES

24.1     FACILITY AGENT'S FEE

         The Company must pay to the Facility Agent for its own account an
         agency fee in the manner agreed in the Fee Letter between the Facility
         Agent and the Company.

24.2     ARRANGEMENT FEE

         The Company must pay to the Arranger for its own account an arrangement
         fee in the manner agreed in the Fee Letter between the Arranger and the
         Company.

24.3     COMMITMENT FEE

(a)      The Company must pay a commitment fee computed at the rate of 0.5 per
         cent. per annum on the undrawn, uncancelled amount of each Lender's
         Commitment.

(b)      Accrued commitment fee is payable quarterly in arrear. Accrued
         commitment fee is also payable to the Facility Agent for a Lender on
         the date its Commitment is cancelled in full.

25.      INDEMNITIES AND BREAK COSTS

25.1     CURRENCY INDEMNITY

(a)      The Company must, as an independent obligation, indemnify each Finance
         Party against any loss or liability which that Finance Party incurs as
         a consequence of:

         (i)      that Finance Party receiving an amount in respect of an
                  Obligor's liability under the Finance Documents; or

<PAGE>   60
                                       57



         (ii)     that liability being converted into a claim, proof, judgment
                  or order,

         in a currency other than the currency in which the amount is expressed
         to be payable under the relevant Finance Document.

(b)      Unless otherwise required by law, each Obligor waives any right it may
         have in any jurisdiction to pay any amount under the Finance Documents
         in a currency other than that in which it is expressed to be payable.

25.2     OTHER INDEMNITIES

(a)      The Company must indemnify each Finance Party against any loss or
         liability which that Finance Party incurs as a consequence of:

         (i)      the occurrence of any Event of Default;

         (ii)     any failure by an Obligor to pay any amount due under a
                  Finance Document on its due date, including any resulting from
                  any distribution or redistribution of any amount among the
                  Banks under and as provided for in this Agreement;

         (iii)    (other than by reason of negligence or default by that Finance
                  Party) a Loan not being made after a Request has been
                  delivered for that Loan; or

         (iv)     a Loan (or part of a Loan) not being prepaid in accordance
                  with a notice of prepayment.

         The Company's liability in each case includes any loss (other than loss
         of margin) or expense on account of funds borrowed, contracted for or
         utilised to fund any amount payable under any Finance Document, any
         amount repaid or prepaid or any Loan.

(b)      The Company must indemnify the Facility Agent against any loss or
         liability reasonably incurred by the Facility Agent as a result of:

         (i)      investigating any event which the Facility Agent reasonably
                  believes to be a Default; or

         (ii)     acting or relying on any notice which the Facility Agent
                  reasonably believes to be genuine, correct and appropriately
                  authorised.

25.3     BREAK COSTS

(a)      Each Borrower must pay to each Lender its Break Costs.

(b)      Break Costs are the amount (if any) determined by the relevant Lender
         by which:

         (i)      the interest which that Lender would have received for the
                  period from the date of receipt of any part of its share in a
                  Loan or an overdue amount to the last day of the current
                  Interest Period for that Loan or overdue amount if the
                  principal or overdue amount received had been paid on the last
                  day of that Interest Period;
<PAGE>   61
                                       58



         exceeds

         (ii)     the amount which that Lender would be able to obtain by
                  placing an amount equal to the amount received by it on
                  deposit with a leading bank in the London interbank market for
                  a period starting on the Business Day following receipt and
                  ending on the last day of the relevant Interest Period.

(c)      Each Lender must supply to the Facility Agent for the relevant Borrower
         details of the amount of any Break Costs claimed by it under this
         Subclause.

26.      EXPENSES

26.1     INITIAL COSTS

         The Company must pay to each Administrative Party the amount of all
         costs and expenses (including legal fees) reasonably incurred by it in
         connection with the negotiation, preparation, printing, execution and
         syndication of the Finance Documents.

26.2     SUBSEQUENT COSTS

         The Company must pay to the Facility Agent the amount of all costs and
         expenses (including legal fees) reasonably incurred by it in connection
         with:

         (a)      the negotiation, preparation, printing and execution of any
                  Finance Document (other than a Transfer Certificate) executed
                  after the date of this Agreement; and

         (b)      any amendment, waiver or consent requested by or on behalf of
                  an Obligor or specifically allowed by this Agreement.

26.3     ENFORCEMENT COSTS

         The Company must pay to each Finance Party the amount of all costs and
         expenses (including legal fees) incurred by it in connection with the
         enforcement of, or the preservation of any rights under, any Finance
         Document.

27.      AMENDMENTS AND WAIVERS

27.1     PROCEDURE

(a)      Except as provided in this Clause, any term of the Finance Documents
         may be amended or waived with the agreement of the Company and the
         Majority Lenders. The Facility Agent may effect, on behalf of any
         Finance Party, an amendment or waiver allowed under this Clause.

(b)      The Facility Agent must promptly notify the other Parties of any
         amendment or waiver effected by it under paragraph (a) above. Any such
         amendment or waiver is binding on all the Parties.
<PAGE>   62
                                       59



27.2     EXCEPTIONS

(a)      An amendment or waiver which relates to:

         (i)      the definition of "MAJORITY LENDERS" in Clause 1.1
                  (Definitions);

         (ii)     an extension of the date of payment of any amount to a Lender
                  under the Finance Documents;

         (iii)    a reduction in the Margin or a reduction in the amount of any
                  payment of principal, interest, fee or other amount payable to
                  a Lender under the Finance Documents;

         (iv)     an increase in, or an extension of, a Commitment;

         (v)      a release of an Obligor;

         (vi)     a term of a Finance Document which expressly requires the
                  consent of each Lender;

         (vii)    the right of a Lender to assign or transfer its rights or
                  obligations under the Finance Documents; or (viii) this
                  Clause,

         may only be made with the consent of all the Lenders.

(b)      An amendment or waiver which relates to the rights or obligations of an
         Administrative Party may only be made with the consent of that
         Administrative Party.

27.3     CHANGE OF CURRENCY

         If a change in any currency of a country occurs (including where there
         is more than one currency or currency unit recognised at the same time
         as the lawful currency of a country), the Finance Documents will be
         amended to the extent the Facility Agent (acting reasonably and after
         consultation with the Company) determines is necessary to reflect the
         change.

27.4     WAIVERS AND REMEDIES CUMULATIVE

         The rights of each Finance Party under the Finance Documents:

         (a)      may be exercised as often as necessary;

         (b)      are cumulative and not exclusive of its rights under the
                  general law; and

         (c)      may be waived only in writing and specifically.

         Delay in exercising or non-exercise of any right is not a waiver of
         that right.

<PAGE>   63
                                       60

28.      CHANGES TO THE PARTIES

28.1     ASSIGNMENTS AND TRANSFERS BY OBLIGORS

         No Obligor may assign or transfer any of its rights and obligations
         under the Finance Documents without the prior consent of all the
         Lenders.

28.2     ASSIGNMENTS AND TRANSFERS BY LENDERS

(a)      A Lender (the "EXISTING LENDER") may, subject to the following
         provisions of this Subclause, at any time assign or transfer (including
         by way of novation) any of its rights and obligations under this
         Agreement to another person (the "NEW LENDER").

(b)      The consent of the Company is required for any assignment or transfer
         unless the New Lender is another Lender or an Affiliate of a Lender.
         The consent of the Company must not be unreasonably withheld or
         delayed. The Company will be deemed to have given its consent ten
         Business Days after the Company is given notice of the request unless
         it is expressly refused by the Company within that time.

(c)      A transfer of obligations will be effective only if either:

         (i)     the obligations are novated in accordance with the following
                 provisions of this Clause; or

         (ii)    the New Lender confirms to the Facility Agent and the Company
                 in form and substance satisfactory to the Facility Agent that
                 it is bound by the terms of this Agreement as a Lender. On the
                 transfer becoming effective in this manner the Existing Lender
                 will be released from its obligations under this Agreement to
                 the extent that they are transferred to the New Lender.

(d)      Unless the Facility Agent otherwise agrees, the New Lender must pay to
         the Facility Agent for its own account, on or before the date any
         assignment or transfer occurs, a fee of pound sterling 1,000.

(e)      Any reference in this Agreement to a Lender includes a New Lender but
         excludes a Lender if no amount is or may be owed to or by it under this
         Agreement.

28.3     PROCEDURE FOR TRANSFER BY WAY OF NOVATIONS

(a)      In this Subclause:

         "TRANSFER DATE"

         means, for a Transfer Certificate, the later of:

         (i)     the proposed Transfer Date specified in that Transfer
                 Certificate;

         (ii)    the date on which the Facility Agent executes that Transfer
                 Certificate; and

         (iii)   5 Business Days after the date on which the completed Transfer
                 Certificate is received by the Facility Agent, or such earlier
                 date as is agreed by the Facility Agent.
<PAGE>   64

                                       61

(b)      A novation is effected if:

         (i)     the Existing Lender and the New Lender deliver to the Facility
                 Agent a duly completed Transfer Certificate; and

         (ii)    the Facility Agent executes it.

         The Facility Agent must execute as soon as reasonably practicable a
         Transfer Certificate delivered to it and which appears on its face to
         be in order.

(c)      Each Party (other than the Existing Lender and the New Lender)
         irrevocably authorises the Facility Agent to execute any duly completed
         Transfer Certificate on its behalf.

(d)      On the Transfer Date:

         (i)     the New Lender will assume the rights and obligations of the
                 Existing Lender expressed to be the subject of the novation in
                 the Transfer Certificate in substitution for the Existing
                 Lender; and

         (ii)    the Existing Lender will be released from those obligations and
                 cease to have those rights.

28.4     LIMITATION OF RESPONSIBILITY OF EXISTING LENDER

(a)      Unless  expressly  agreed to the contrary,  an Existing  Lender is not
         responsible to a New Lender for the legality, validity, adequacy,
         accuracy, completeness or performance of:

         (i)     any Finance Document or any other document; or

         (ii)    any statement or information (whether written or oral) made in
                 or supplied in connection with any Finance Document,

         and any representations or warranties implied by law are excluded.

(b)      Each New Lender confirms to the Existing Lender and the other Finance
         Parties that it:

         (i)     has made, and will continue to make, its own independent
                 appraisal of all risks arising under or in connection with the
                 Finance Documents (including the financial condition and
                 affairs of each Obligor and its related entities and the nature
                 and extent of any recourse against any Party or its assets) in
                 connection with its participation in this Agreement; and

         (ii)    has not relied exclusively on any information supplied to it by
                 the Existing Lender in connection with any Finance Document.

(c)      Nothing in any Finance Document requires an Existing Lender to:

         (i)     accept a re-transfer from a New Lender of any of the rights and
                 obligations assigned or transferred under this Clause; or
<PAGE>   65

                                       62

         (ii)    support any losses incurred by the New Lender by reason of the
                 non-performance by any Obligor of its obligations under any
                 Finance Document or otherwise.

28.5     COSTS RESULTING FROM CHANGE OF LENDER OR FACILITY OFFICE

         If:

         (a)      a Lender assigns or transfers any of its rights and
                  obligations under the Finance Documents or changes its
                  Facility Office; and

         (b)      as a result of circumstances existing at the date the
                  assignment, transfer or change occurs, an Obligor would be
                  obliged to pay a Tax Payment or an Increased Cost,

         then, unless the assignment, transfer or change is made by a Lender to
         mitigate any circumstances giving rise to the Tax Payment, Increased
         Cost or a right to be prepaid and/or cancelled by reason of illegality,
         the Obligor need only pay that Tax Payment or Increased Cost to the
         same extent that it would have been obliged to if no assignment,
         transfer or change had occurred.

28.6     ADDITIONAL OBLIGORS

(a)      The Company must, within 30 days of the date on which any member of the
         Group becomes a Material Subsidiary after the date of this Agreement,
         ensure that the relevant Material Subsidiary (if it is not already)
         becomes a Guarantor by delivering to the Facility Agent the documents
         listed in Part II of Schedule 2 in relation to that Subsidiary, in each
         case in form and substance satisfactory to the Facility Agent.

(b)      (i)     If the Company wishes one of its wholly-owned Subsidiaries to
                 become an Additional Obligor other than when required to do so
                 under paragraph (a) above, then it may (following consultation
                 with the Facility Agent) deliver to the Facility Agent the
                 relevant documents and evidence listed in Part II of Schedule 2
                 (Conditions precedent documents).

         (ii)    The prior consent of all the Lenders is required if the
                 Additional Obligor is incorporated in a jurisdiction outside
                 the U.K.

         (iii)   The relevant Subsidiary will become an Additional Obligor when
                 the Facility Agent notifies the other Finance Parties and the
                 Company that it has received all of the documents and evidence
                 referred to in sub-paragraph (i) above in form and substance
                 satisfactory to it. The Facility Agent must give this
                 notification as soon as reasonably practicable.

(c)      Delivery of an Accession Agreement, executed by the relevant Subsidiary
         and the Company, to the Facility Agent constitutes confirmation by that
         Subsidiary and the Company that the Repeating Representations are then
         correct.
<PAGE>   66

                                       63

28.7     RESIGNATION OF AN OBLIGOR (OTHER THAN THE COMPANY)

(a)      In this Subclause, "RESIGNATION REQUEST" means a letter in the form of
         Schedule 9 (Form of Resignation Request), with such amendments as the
         Facility Agent may approve or reasonably require.

(b)      The Company may request that an Obligor (other than the Company) ceases
         to be an Obligor by giving to the Facility Agent a duly completed
         Resignation Request.

(c)      The Facility Agent must accept a Resignation Request and notify the
         Company and the Lenders of its acceptance if:

         (i)     in the case of a Guarantor, the Majority Lenders have consented
                 to the Resignation Request;

         (ii)    it is not aware that a Default is outstanding or would result
                 from the acceptance of the Resignation Request; and

         (iii)   no amount owed by that Obligor under this Agreement is still
                 outstanding.

(d)      The Obligor will cease to be a Borrower and/or a Guarantor, as
         appropriate, when the Facility Agent gives the notification referred to
         in paragraph (c) above.

(e)      An Obligor (other than the Company) may also cease to be an Obligor in
         any other manner approved by the Majority Lenders.

28.8     CHANGES TO THE REFERENCE BANKS

         If a Reference Bank (or, if a Reference Bank is not a Lender, the
         Lender of which it is an Affiliate) ceases to be a Lender, the Facility
         Agent must (in consultation with the Company) appoint another Lender or
         an Affiliate of a Lender to replace that Reference Bank.

29.      DISCLOSURE OF INFORMATION

(a)      Each Finance Party must keep confidential any information supplied to
         it by or on behalf of any Obligor in connection with the Finance
         Documents. However, a Finance Party is entitled to disclose
         information:

         (i)     which is publicly available, other than as a result of a breach
                 by that Finance Party of this Clause;

         (ii)    in connection with any legal or arbitration proceedings;

         (iii)   if required to do so under any law or regulation;

         (iv)    if it is required to do so, or if that authority has requested
                 the disclosure, to a governmental, banking, taxation or other
                 regulatory authority with whose requirements that Finance Party
                 is required to comply or customarily complies;

         (v)     to its professional advisers;


<PAGE>   67

                                       64

         (vi)    to the extent allowed under paragraph (b) below; or

         (vii)   with the agreement of the relevant Obligor.

(b)      A Finance Party may disclose to an Affiliate or any person with whom it
         may enter, or has entered into, any kind of transfer, participation or
         other agreement in relation to this Agreement (a "PARTICIPANT"):

         (i)     a copy of any Finance Document; and

         (ii)    any information which that Finance Party has acquired under or
                 in connection with any Finance Document.

         However, before a participant may receive any confidential information,
         it must agree with the relevant Finance Party for itself and on behalf
         of the Company to keep that information confidential on the terms of
         paragraph (a) above.

(c)      This Clause supersedes any previous confidentiality undertaking given
         by a Finance Party in connection with this Agreement prior to it
         becoming a Party.

30.      SET-OFF

         While an Event of Default is outstanding, a Finance Party may set off
         any matured obligation owed to it by an Obligor under the Finance
         Documents (to the extent beneficially owned by that Finance Party)
         against any obligation (whether or not matured) owed by that Finance
         Party to that Obligor, regardless of the place of payment, booking
         branch or currency of either obligation. If the obligations are in
         different currencies, the Finance Party may convert either obligation
         at a market rate of exchange in its usual course of business for the
         purpose of the set-off.

31.      PRO RATA SHARING

31.1     REDISTRIBUTION

         If any amount owing by an Obligor under this Agreement to a Lender (the
         "RECOVERING LENDER") is discharged by payment, set-off or any other
         manner other than through the Facility Agent under this Agreement (a
         "RECOVERY"), then:

         (a)      the recovering Lender must, within three Business Days, supply
                  details of the recovery to the Facility Agent;

         (b)      the Facility Agent must calculate whether the recovery is in
                  excess of the amount which the recovering Lender would have
                  received if the recovery had been received by the Facility
                  Agent under this Agreement; and

         (c)      the recovering Lender must pay to the Facility Agent an amount
                  equal to the excess (the "REDISTRIBUTION").
<PAGE>   68

                                       65

31.2     EFFECT OF REDISTRIBUTION

(a)      The Facility Agent must treat a redistribution as if it were a payment
         by the relevant Obligor under this Agreement and distribute it among
         the Lenders (other than the recovering Lender) accordingly.

(b)      When the Facility Agent makes a distribution under paragraph (a) above,
         the recovering Lender will be subrogated to the rights of the Finance
         Parties which have shared in that redistribution.

(c)      If and to the extent that the recovering Lender is not able to rely on
         any rights of subrogation under paragraph (b) above, the relevant
         Obligor will owe the recovering Lender a debt which is equal to the
         redistribution, immediately payable and of the type originally
         discharged.

         If:

         (i)     a recovering Lender must subsequently return a recovery, or an
                 amount measured by reference to a recovery, to an Obligor; and

         (ii)    the recovering Lender has paid a redistribution in relation to
                 that recovery,

         each Finance Party must reimburse the recovering Lender all or the
         appropriate portion of the redistribution paid to that Finance Party,
         together with interest for the period while it held the
         re-distribution. In this event, the subrogation in paragraph (b) above
         will operate in reverse to the extent of the reimbursement.

31.3     EXCEPTIONS

         Notwithstanding any other term of this Clause, a recovering Lender need
         not pay a redistribution to the extent that:

         (a)     it would not, after the payment, have a valid claim against the
                 relevant Obligor in the amount of the redistribution; or

         (b)     it would be sharing with another Finance Party any amount which
                 the recovering Lender has received or recovered as a result of
                 legal or arbitration proceedings, where:

                 (i)      the recovering Lender notified the Facility Agent of
                          those proceedings; and

                 (ii)     the other Finance Party had an opportunity to
                          participate in those proceedings but did not do so or
                          did not take separate legal or arbitration
                          proceedings as soon as reasonably practicable after
                          receiving notice of them.

32.      SEVERABILITY

         If a term of a Finance Document is or becomes illegal, invalid or
         unenforceable in any jurisdiction, that shall not affect:
<PAGE>   69


                                       66

         (a)     the legality, validity or enforceability in that jurisdiction
                 of any other term of the Finance Documents; or

         (b)     the legality, validity or enforceability in other jurisdictions
                 of that or any other term of the Finance Documents.

33.      COUNTERPARTS

         Each Finance Document may be executed in any number of counterparts.
         This has the same effect as if the signatures on the counterparts were
         on a single copy of the Finance Document.

34.      NOTICES

34.1     IN WRITING

(a)      Any communication in connection with a Finance Document must be in
         writing and, unless otherwise stated, may be given in person, by post
         or fax.

(b)      Unless it is agreed to the contrary, any consent or agreement required
         under a Finance Document must be given in writing.

34.2     CONTACT DETAILS

(a)      Except as provided below, the contact details of each Party for all
         communications in connection with the Finance Documents are those
         notified by that Party for this purpose to the Facility Agent on or
         before the date it becomes a Party.

(b)      The contact details of the Company for this purpose are:

         Address:          3rd Floor,
                           Meirion House
                           18-28 Guildford Road
                           Woking, Surrey GU22 7QF
         Fax number:       01483 778599
         Attention:        The Group Finance Director

(c)      The contact details of the Facility Agent for this purpose are:

                           Address:
                           Corporate Banking Office
                           1st Floor
                           5-10 Great Tower Street
                           London
                           EC3P 3HX
         Fax number:       020 7220 7370
         Attention:        CBO Loans Agency Operations.

(d)      Any Party may change its contact details by giving five Business Days'
         notice to the Facility Agent or (in the case of the Facility Agent) to
         the other Parties.


<PAGE>   70

                                       67

(e)      Where a Party nominates a particular department or officer to receive a
         communication, a communication will not be effective if it fails to
         specify that department or officer.

34.3     EFFECTIVENESS

(a)      Except as provided below, any communication in connection with a
         Finance Document will be deemed to be given as follows:

         (i)     if delivered in person, at the time of delivery;

         (ii)    if posted, five days after being deposited in the post, postage
                 prepaid, in a correctly addressed envelope; and

         (iii)   if by fax, when received in legible form.

(b)      A communication given under paragraph (a) above but received on a
         non-working day or after business hours in the place of receipt will
         only be deemed to be given on the next working day in that place.

(c)      A communication to the Facility Agent will only be effective on actual
         receipt by it.

34.4     OBLIGORS

(a)      All communications under the Finance Documents to or from an Obligor
         must be sent through the Facility Agent.

(b)      All communications under the Finance Documents to or from an Obligor
         (other than the Company) must be sent through the Company.

(c)      Each Obligor (other than the Company) irrevocably appoints the Company
         to act as its agent:

         (i)     to give and receive all communications under the Finance
                 Documents; and

         (ii)    to sign all documents under or in connection with the Finance
                 Documents.

(d)      Any communication given to the Company in connection with a Finance
         Document will be deemed to have been given also to the other Obligors.

(e)      The Facility Agent may assume that any communication made by the
         Company is made with the consent of each other Obligor.

35.      LANGUAGE

(a)      Any notice given in connection with a Finance Document must be in
         English.

(b)      Any other document provided in connection with a Finance Document must
         be:

         (i)     in English; or

<PAGE>   71

                                       68

         (ii)     (unless the Facility Agent otherwise agrees) accompanied by a
                  certified English translation. In this case, the English
                  translation prevails unless the document is a statutory or
                  other official document.

36.      GOVERNING LAW

         This Agreement is governed by English law.

37.      ENFORCEMENT

37.1     JURISDICTION

(a)      The English courts have exclusive jurisdiction to settle any dispute in
         connection with any Finance Document.

(b)      The English courts are the most appropriate and convenient courts to
         settle any such dispute and each Obligor waives objection to those
         courts on the grounds of inconvenient forum or otherwise in relation to
         proceedings in connection with any Finance Document.

(c)      This Clause is for the benefit of the Finance Parties only. To the
         extent allowed by law, a Finance Party may take:

         (i)     proceedings in any other court; and

         (ii)    concurrent proceedings in any number of jurisdictions.

37.2     SERVICE OF PROCESS

(a)      Each Obligor not incorporated in England and Wales irrevocably appoints
         the Company as its agent under the Finance Documents for service of
         process in any proceedings before the English courts.

(b)      If any person appointed as process agent is unable for any reason to
         act as agent for service of process, the Company (on behalf of all the
         Obligors) must immediately appoint another agent on terms acceptable to
         the Facility Agent. Failing this, the Facility Agent may appoint
         another agent for this purpose.

(c)      Each Obligor agrees that failure by a process agent to notify it of any
         process will not invalidate the relevant proceedings.

(d)      This Clause does not affect any other method of service allowed by law.

This Agreement has been entered into on the date stated at the beginning of this
Agreement.

<PAGE>   72

                                       69

                                   SCHEDULE 1

                                ORIGINAL PARTIES



NAME OF ORIGINAL BORROWER                           REGISTRATION NUMBER
                                                  (OR EQUIVALENT, IF ANY)

Fairclough Homes Limited                                  1987689



NAME OF ORIGINAL GUARANTOR                          REGISTRATION NUMBER
                                                  (OR EQUIVALENT, IF ANY)

Fairclough Homes Limited                                  1987689

Viewton Properties Limited                                2436950



NAME OF ORIGINAL LENDER                                  COMMITMENTS

                                                        pound sterling

National Westminster Bank Plc                            100,000,000


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

TOTAL COMMITMENTS                                  pound sterling 100,000,000


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




<PAGE>   73
                                       70

                                   SCHEDULE 2

                         CONDITIONS PRECEDENT DOCUMENTS

                                     PART I

                    TO BE DELIVERED BEFORE THE FIRST REQUEST



ORIGINAL OBLIGORS

1.       A copy of the constitutional documents of each Original Obligor.

2.       A copy of a resolution of the board of directors of each Original
         Obligor approving the terms of, and the transactions contemplated by,
         this Agreement.

3.       A specimen of the signature of each person authorised on behalf of an
         Original Obligor to execute or witness the execution of any Finance
         Document or to sign or send any document or notice in connection with
         any Finance Document.

4.       A copy of a resolution signed by all (or any lower percentage agreed by
         the Facility Agent) of the holders of the issued or allotted shares in
         each Original Guarantor approving the terms of, and the transactions
         contemplated by, this Agreement.

5.       If applicable, a copy of a resolution of the board of directors of each
         corporate shareholder in each Original Guarantor approving the terms of
         the resolution referred to in paragraph 4 above.

6.       A certificate of an authorised signatory of the Company:

         (a)     confirming that utilising the Total Commitments in full would
                 not breach any limit binding on any Original Obligor; and

         (b)     certifying that each copy document specified in Part I of this
                 Schedule is correct, complete and in full force and effect as
                 at a date no earlier than the date of this Agreement.

SECURITY DOCUMENT(S)

1.       A Security Agreement duly executed by each Original Obligor.

2.       Share certificates and duly executed stock transfer forms in blank for
         any shares owned by an Original Obligor.
<PAGE>   74

                                       71

LEGAL OPINIONS

         A legal opinion of Allen & Overy, legal advisers to the Arranger and
         the Facility Agent, substantially in the form of Schedule 11 (Form of
         legal opinion of Allen & Overy), addressed to the Finance Parties.

OTHER DOCUMENTS AND EVIDENCE

1.       Evidence that all fees and expenses then due and payable from the
         Company under this Agreement have been or will be paid by the first
         Utilisation Date.

2.       Copies of notices of prepayment and cancellation evidencing that all
         existing facilities (other than the pound sterling 5,000,000 net
         overdraft facility and pound sterling 5,000,000 bonding line with
         National Westminster Bank Plc and the RBS Promissory Note) will be
         prepaid and cancelled in full on or by the first Utilisation Date.

3.       A Compliance Certificate setting out the Adjusted Security Asset Value
         as at 28th February, 2001.

4.       A copy of all board resolutions, shareholder written resolutions,
         declarations, auditors reports and other documents required to ensure
         compliance with Sections 151-158 of the Companies Act 1985, together
         with a letter addressed to the Finance Parties and each relevant
         Obligor from the auditors in the agreed form.





<PAGE>   75
                                       72


                                     PART II

                            FOR AN ADDITIONAL OBLIGOR



ADDITIONAL OBLIGORS

1.       An Accession Agreement, duly executed by the Company and the Additional
         Obligor.

2.       A copy of the constitutional documents of the Additional Obligor.

3.       A copy of a resolution of the board of directors of the Additional
         Obligor approving the terms of, and the transactions contemplated by,
         the Accession Agreement.

4.       A specimen of the signature of each person authorised on behalf of the
         Additional Obligor to execute or witness the execution of any Finance
         Document or to sign or send any document or notice in connection with
         any Finance Document.

5.       In the case of an Additional Guarantor incorporated in the U.K., a copy
         of a resolution, signed by all (or any lower percentage agreed by the
         Facility Agent) of the holders of its issued or allotted shares,
         approving the terms of, and the transactions contemplated by, the
         Accession Agreement.

6.       If applicable, a copy of a resolution of the board of directors of each
         corporate shareholder in the Additional Guarantor approving the
         resolution referred to in paragraph 5 above.

7.       A certificate of an authorised signatory of the Additional Obligor:

         (a)     confirming that utilising the Total Commitments in full would
                 not breach any limit binding on it; and

         (b)     certifying that each copy document specified in Part II of this
                 Schedule is correct, complete and in full force and effect as
                 at a date no earlier than the date of the Accession Agreement.

8.       If available, a copy of the latest audited accounts of the Additional
         Obligor.

SECURITY DOCUMENT(S)

1.       A Security Agreement over its assets, duly executed by the Additional
         Obligor.

2.       A copy of any notices required to be sent under that Agreement.

3.       Share certificates and duly executed stock transfer forms in blank for
         any shares owned by the Additional Obligors.

LEGAL OPINIONS
<PAGE>   76
                                       73

1.       A legal opinion of Allen & Overy, legal advisers to the Facility Agent,
         addressed to the Finance Parties.

2.       If the Additional Obligor is incorporated in a jurisdiction other than
         England, a legal opinion from legal advisers in that jurisdiction,
         addressed to the Finance Parties.

OTHER DOCUMENTS AND EVIDENCE

1.       Evidence that all expenses due and payable from the Company under this
         Agreement in respect of the Accession Agreement have been paid.

2.       A copy of any other authorisation or other document, opinion or
         assurance which the Facility Agent has notified the Company is
         necessary or desirable in connection with the entry into and
         performance of, and the transactions contemplated by, the Accession
         Agreement or for the validity and enforceability of any Finance
         Document.

<PAGE>   77
                                       74

                                   SCHEDULE 3

                                 FORM OF REQUEST

To:      THE ROYAL BANK OF SCOTLAND PLC as Facility Agent

From:    [                               ]

Date:    [                               ]

   FAIRCLOUGH HOMES GROUP LIMITED-POUND STERLING 100,000,000 CREDIT AGREEMENT
             DATED [                      ], 2001 (THE "AGREEMENT")

1.       We refer to the Agreement.  This is a Request.

2.       We wish to borrow a Loan on the following terms:

         (a)      Utilisation Date: [          ]

         (b)      Amount: [                             ]

         (c)      Interest Period: [                           ].

3.       Our payment instructions are: [                            ].

4.       We confirm that each condition precedent under the Agreement which must
         be satisfied on the date of this Request is so satisfied.

5.       This Request is irrevocable.

By:

[                               ]

<PAGE>   78
                                       75

                                   SCHEDULE 4

                        CALCULATION OF THE MANDATORY COST

1.       GENERAL

         The Mandatory Cost is an addition to the interest rate to compensate
         Lenders for the cost of compliance with:

         (a)     the requirements of the Bank of England and/or the Financial
                 Services Authority (or, in either case, any other authority
                 which replaces all or any of its functions); or

         (b)     the requirements of the European Central Bank.

2.       CALCULATION - GENERAL

         On the first day of each Interest Period (or as soon as possible
         thereafter) the Facility Agent shall calculate, as a percentage rate, a
         rate (the "ADDITIONAL COST RATE") for each Lender, in accordance with
         the paragraphs set out below. The Mandatory Cost will be calculated by
         the Facility Agent as a weighted average of the Lenders' Additional
         Cost Rates (weighted in proportion to the percentage participation of
         each Lender in the relevant Loan) and will be expressed as a percentage
         rate per annum.

2.       FOR A LENDER LENDING FROM A FACILITY OFFICE IN THE U.K.

(a)      The Additional Cost Rate for a Lender lending from a Facility Office in
         the U.K. will be calculated by the Facility Agent as follows:

         AB + C(B-D) + E x 0.01
         ----------------------  per cent, per annum
              100 - (A + C)

         where on the day of application of the formula:

         A       is the percentage of eligible liabilities (in excess of any
                 stated minimum) which the Bank of England requires that Lender
                 to hold on a non-interest-bearing deposit account with the Bank
                 of England to comply with cash ratio requirements;

         B       is LIBOR for that Interest Period;

         C       is the percentage (if any) of eligible liabilities which the
                 Bank of England requires that Lender to place as a special
                 deposit with the Bank of England;

         D       is the interest rate per annum allowed by the Bank of England
                 on a special deposit; and

         E       is the rate of charge payable by that Lender to the Financial
                 Services Authority under the fees regulations (but, for this
                 purpose, ignoring any minimum fee required under the fees
                 regulations) and expressed in pounds per pound sterling 1
                 million of the fee base of that Lender.
<PAGE>   79
                                       76

(b)      For the purposes of this paragraph 2:

         (i)     "ELIGIBLE LIABILITIES" and "SPECIAL DEPOSIT" have the meanings
                 given to them from time to time under or pursuant to the Bank
                 of England Act 1998 or (as may be appropriate) by the Bank of
                 England;

         (ii)    "FEE BASE" has the meaning given to it in, and will be
                 calculated in accordance with, the fees regulations; and

         (iii)   "FEES REGULATIONS" means The Financial Services Banking
                 Supervision (Fees) Regulations 2000 or such other law or
                 regulation as may be in force from time to time in respect of
                 the payment of fees for banking supervision.

(c)      (i)     In the application of the formula, A, B, C and D are included
                 as figures and not as percentages, e.g. if A = 0.5% and B =
                 15%, AB is calculated as 0.5 x 15. A negative result obtained
                 by subtracting D from B is taken as zero.

         (ii)    Each rate calculated in accordance with the formula is, if
                 necessary, rounded to four decimal places.

(d)      (i)     Each Lender must supply to the Facility Agent the information
                 required by it to make a calculation of the Additional Cost
                 Rate for that Lender. In particular, but without limitation,
                 each Lender shall supply the following information in writing
                 on or prior to the date on which it becomes a Lender:

                 (A)     its jurisdiction of incorporation and the jurisdiction
                         of its Facility Office; and

                 (B)     any other information that the Facility Agent may
                         reasonably require for such purpose.

                 Each Lender shall promptly notify the Facility Agent in writing
                 of any change to the information provided by it pursuant to
                 this paragraph. The Facility Agent may assume that this
                 information is correct in all respects.

         (ii)    The figures or rates of charge of each Lender for the purpose
                 of A, C and E above shall be determined by the Facility Agent
                 based upon the information supplied to it pursuant to
                 sub-paragraph (i) above and on the assumption that, unless a
                 Lender notifies the Facility Agent to the contrary, each
                 Lender's obligations in respect of cash ratio deposits, special
                 deposits and the fees regulations are the same as those of a
                 typical bank from its jurisdiction of incorporation with a
                 Facility Office in the same jurisdiction as its Facility
                 Office.

         (iii)   The Facility Agent has no liability to any Party if its
                 calculation over or under compensates any Lender.

         (iv)    The Facility Agent shall distribute the additional amounts
                 received as a result of the Mandatory Cost to the Lenders on
                 the basis of the Additional Cost Rate for each Lender based on
                 the information provided by each Lender under sub-paragraph
                 d(i) above and paragraph 3 below.
<PAGE>   80
                                       77

         (v)     Any determination by the Facility Agent pursuant to this
                 schedule in relation to a formula, the Mandatory Cost, an
                 Additional Cost Rate or any amount payable to a Lender shall,
                 in the absence of manifest error, be conclusive and binding on
                 all Parties.

3.       FOR A LENDER LENDING FROM A FACILITY OFFICE IN A PARTICIPATING MEMBER
         STATE

(a)      The Additional Cost Rate for a Lender lending from a Facility Office in
         a Participating Member State will be the percentage notified by that
         Lender to the Facility Agent as the cost of complying with the minimum
         reserve requirements of the European Central Bank.

(b)      If a Lender fails to specify a rate under paragraph (a) above, the
         Facility Agent will assume that the Lender has not incurred any such
         cost.

4.       CHANGES

         The Facility Agent may from time to time, after consultation with the
         Company and the Lenders, determine and notify all the Parties of any
         amendment to this Schedule which is required to comply with:

         (a)     any change in law or regulation; or

         (b)     any requirement from time to time imposed by the Bank of
                 England, the Financial Services Authority or the European
                 Central Bank (or, in any case, any other authority which
                 replaces all or any of its functions).

         Any such determination will be, in the absence of manifest error,
         conclusive and binding on all the Parties.

<PAGE>   81
                                       78

                                   SCHEDULE 5

                          FORM OF TRANSFER CERTIFICATE

To:      THE ROYAL BANK OF SCOTLAND PLC as Facility Agent

From:    [THE EXISTING LENDER] (the "Existing Lender") and [THE NEW LENDER] (the
         "NEW LENDER")

Date:    [           ]

  FAIRCLOUGH HOMES GROUP LIMITED - POUND STERLING 100,000,000 CREDIT AGREEMENT
                    DATED 29TH MARCH, 2001 (THE "AGREEMENT")

We refer to the Agreement.  This is a Transfer Certificate.

1.       The Existing Lender transfers by novation to the New Lender the
         Existing Lender's rights and obligations referred to in the Schedule
         below in accordance with the terms of the Agreement.

2.       The proposed Transfer Date is [    ].

3.       The administrative details of the New Lender for the purposes of the
         Agreement are set out in the Schedule.

4.       This Transfer Certificate is governed by English law.

                                  THE SCHEDULE

              RIGHTS AND OBLIGATIONS TO BE TRANSFERRED BY NOVATION
      [insert relevant details, including applicable Commitment (or part)]

                    ADMINISTRATIVE DETAILS OF THE NEW LENDER
      [insert details of Facility Office, address for notices and payment
                                 details etc.]

[EXISTING LENDER]               [NEW LENDER]

By:                             By:

The Transfer Date is confirmed by the Facility Agent as [            ].

THE ROYAL BANK OF SCOTLAND PLC

By:

<PAGE>   82
                                       79



                                   SCHEDULE 6

                                EXISTING SECURITY


<TABLE>
<CAPTION>
        MEMBER OF THE GROUP CREATING                DETAILS OF SECURITY          MAXIMUM PRINCIPAL
                  SECURITY                                                         AMOUNT SECURED
                                                                                   POUND STERLING
<S>                                           <C>                                <C>
           Fairclough Homes Limited             Legal Charge to                           Nil
                                                Tokentriumph Limited dated
                                                20/05/1988

           Fairclough Homes Limited             Charge to National Power             1,923,566.65
                                                PLC dated 03/02/2000

           Fairclough Homes Limited             Legal Charge to David Wood            247,000.00
                                                and Julia Margaret Wood
                                                dated 17/03/2000

           Fairclough Homes Limited             Legal  Charge  to  Kilnhurst              Nil
                                                Limited dated 17/05/2000

           Fairclough Homes Limited             Third Party Legal Charge to               Nil
                                                Girobank Plc dated
                                                01/06/2000 (registered
                                                09/06/2000)

           Fairclough Homes Limited             Third Party Legal Charge to               Nil
                                                Girobank Plc dated
                                                01/06/2000 (registered
                                                09/06/2000)

           Fairclough Homes Limited             Third Party Legal Charge to               Nil
                                                Girobank Plc dated
                                                01/06/2000 (registered
                                                14/06/2000)

           Fairclough Homes Limited             Third Party Legal Charge to               Nil
                                                Girobank Plc dated
                                                01/06/2000 (registered
                                                14/06/2000)
</TABLE>
<PAGE>   83
                                       80

<TABLE>
<CAPTION>
        MEMBER OF THE GROUP CREATING                DETAILS OF SECURITY          MAXIMUM PRINCIPAL
                  SECURITY                                                         AMOUNT SECURED
                                                                                   POUND STERLING
<S>                                           <C>                                <C>

           Fairclough Homes Limited             Third Party Legal Charge to               Nil
                                                Girobank Plc dated
                                                01/06/2000 (registered
                                                15/06/000)

           Fairclough Homes Limited             Third Party Legal Charge to               Nil
                                                Girobank Plc dated
                                                01/06/2000 (registered
                                                15/06/2000)

           Fairclough Homes Limited             Third Party Legal Charge to               Nil
                                                Girobank Plc dated
                                                01/06/2000 (registered
                                                15/06/2000)

           Fairclough Homes Limited             Third Party Legal Charge to               Nil
                                                Girobank Plc dated
                                                01/06/2000 (registered
                                                15/06/2000)

           Fairclough Homes Limited             Third Party Legal Charge to               Nil
                                                Girobank Plc dated
                                                01/06/2000 (registered
                                                15/06/2000)

           Fairclough Homes Limited             Third Party Legal Charge to               Nil
                                                Girobank Plc dated
                                                01/06/2000 (registered
                                                15/06/2000)

           Fairclough Homes Limited             Legal Charge to McLean                    Nil
                                                Homes South West Limited
                                                dated 30/06/2000

           Fairclough Homes Limited             Legal Charge to Renishaw             5,551,875.00
                                                Properties Limited dated
                                                25/10/2000

           Fairclough Homes Limited             Legal Charge to Cathelco              906,806.25
                                                Limited dated 08/11/2000

           Fairclough Homes Limited             Legal Charge to                      1,360,000.00
</TABLE>


<PAGE>   84
                                       81

<TABLE>
<CAPTION>
        MEMBER OF THE GROUP CREATING                DETAILS OF SECURITY          MAXIMUM PRINCIPAL
                  SECURITY                                                         AMOUNT SECURED
                                                                                   POUND STERLING
<S>                                           <C>                                <C>

                                                Megahart Limited dated
                                                26/02/2001
</TABLE>



<PAGE>   85
                                       82

                                   SCHEDULE 7

                         FORM OF COMPLIANCE CERTIFICATE

To:      THE ROYAL BANK OF SCOTLAND PLC as Facility Agent

From:    FAIRCLOUGH HOMES GROUP LIMITED

Date:    [                ]

  FAIRCLOUGH HOMES GROUP LIMITED - POUND STERLING 100,000,000 CREDIT AGREEMENT
                    DATED 29TH MARCH, 2001 (THE "AGREEMENT")

1.       We refer to the Agreement.  This is a Compliance Certificate.

2.       We confirm that as at [relevant testing date]:

         (a)     Adjusted Security Asset Value is [                      ];*

         (b)     the aggregate principal amount of:

                 (i)     outstanding Loans;

                 (ii)    the net amount outstanding under the Overdraft
                         Facility; and

                 (iii)   the amount outstanding under the Bonding Facility,

                 is pound sterling [ ]; therefore, the Adjusted Security Asset
                 Value is [ ] per cent. ([ ]%) of that amount;*

         (c)     Consolidated Tangible Net Worth is [ ];**

         (d)     Consolidated Total Net Borrowings are [      ]; therefore,
                 Consolidated Total Net Borrowings are [      ] per cent.
                 ([    ]%) of Consolidated Tangible Net Worth; and**

         (e)     Consolidated EBIT was [       ] and Consolidated Net Interest
                 Payable was [       ]; therefore, the ratio of Consolidated
                 EBIT to Consolidated Net Interest Payable was [       ] to 1.**

3.       We set out below calculations establishing the figures in paragraph 2
         above based on [describe accounts]:

         [             ].

4.       We confirm that the following companies were Material Subsidiaries at
         [relevant testing date]:**




--------
*        Monthly.
**       Only at the end of each financial quarter and when annual audited
         consolidated accounts of the Company provided.
<PAGE>   86
                                       83


         [             ].

5.       [We confirm that no Default is outstanding as at [relevant testing
         date].*

FAIRCLOUGH HOMES GROUP LIMITED

By:



<PAGE>   87
                                       84



                                   SCHEDULE 8

                           FORM OF ACCESSION AGREEMENT

To:      THE ROYAL BANK OF SCOTLAND PLC as Facility Agent

From:    FAIRCLOUGH HOMES GROUP LIMITED and [Proposed Borrower/Proposed
         Guarantor]

Date:    [             ]

  FAIRCLOUGH HOMES GROUP LIMITED - POUND STERLING 100,000,000 CREDIT AGREEMENT
                    DATED 29TH MARCH, 2001 (THE "AGREEMENT")

We refer to the Agreement.  This is an Accession Agreement.

[Name of company] of [address/registered office] agrees to become an Additional
Borrower/Guarantor* and to be bound by the terms of the Agreement as an
Additional Borrower/Guarantor*.

This Accession Agreement is governed by English law.



FAIRCLOUGH HOMES GROUP LIMITED



By:



[PROPOSED BORROWER/GUARANTOR]*



By:


-----------------------------------------
*        Delete as applicable.
<PAGE>   88
                                       85

                                   SCHEDULE 9

                           FORM OF RESIGNATION REQUEST

To:      THE ROYAL BANK OF SCOTLAND PLC as Facility Agent

From:    FAIRCLOUGH HOMES GROUP LIMITED and [relevant Obligor]

Date:    [             ]

  FAIRCLOUGH HOMES GROUP LIMITED - POUND STERLING 100,000,000 CREDIT AGREEMENT
                    DATED 29TH MARCH, 2001 (THE "AGREEMENT")

1.       We refer to the Agreement. This is a Resignation Request.

2.       We request that [resigning Obligor] be released from its obligations as
         [a/an] [Obligor/Borrower/Guarantor]* under the Agreement.

3.       We confirm that no Default is outstanding or would result from the
         acceptance of this Resignation Request.

4.       We confirm that as at the date of this Resignation Request no amount
         owed by [resigning Obligor] under the Agreement is outstanding.

5.       This Resignation Request is governed by English law.



FAIRCLOUGH HOMES GROUP LIMITED      [Relevant Obligor]

By:      By:



The Facility Agent confirms that this resignation takes effect on [        ].



THE ROYAL BANK OF SCOTLAND PLC

By:




-----------------------------------------
*        Delete as applicable.

<PAGE>   89
                                       86



                                   SCHEDULE 10

                           FORM OF SECURITY AGREEMENT



                               SECURITY AGREEMENT



                          DATED [       ] March, 2001


                                     BETWEEN



                         FAIRCLOUGH HOMES GROUP LIMITED
                            FAIRCLOUGH HOMES LIMITED
                           VIEWTON PROPERTIES LIMITED


                                     - and -


                         THE ROYAL BANK OF SCOTLAND PLC




                                  ALLEN & OVERY
                                     London


<PAGE>   90
                                       87





                                      INDEX

<TABLE>
<CAPTION>

CLAUSE                                                                                                      PAGE
<S>                                                                                                      <C>
1.       Interpretation.....................................................................................88
2.       Creation of Security...............................................................................91
3.       Representations - general..........................................................................92
4.       Restrictions on dealings...........................................................................92
5.       Investments........................................................................................92
6.       When Security becomes enforceable..................................................................94
7.       Enforcement of Security............................................................................94
8.       Receiver...........................................................................................96
9.       Powers of Receiver.................................................................................97
10.      Application of proceeds............................................................................99
11.      Expenses and indemnity.............................................................................99
12.      Delegation........................................................................................100
13.      Further assurances................................................................................100
14.      Power of attorney.................................................................................100
15.      Miscellaneous.....................................................................................101
16.      Release...........................................................................................101
17.      Governing law.....................................................................................102


SCHEDULES

1        Chargors..........................................................................................103

SIGNATORIES................................................................................................109
</TABLE>

<PAGE>   91
                                       88


THIS DEED is dated [     ] March, 2001 between:

(1)      THE COMPANIES listed in Schedule 1 as chargors (each a "Chargor");

(2)      THE ROYAL BANK OF SCOTLAND PLC (the "Facility Agent") as agent and
         trustee for the Senior Lenders (as defined below).

BACKGROUND:

(A)      Each Chargor enters into this Deed in connection with the Credit
         Agreement (as defined below).

(B)      It is intended that this document takes effect as a deed
         notwithstanding the fact that a party may only execute this document
         under hand.

IT IS AGREED as follows:

1.       INTERPRETATION

1.1      DEFINITIONS

         In this Deed:

         "ACT"

         means the Law of Property Act 1925.

         "BONDING FACILITY"

         means a bonding facility of up to pound sterling 5,000,000 (or its
         equivalent in other currencies) in aggregate made available, or to be
         made available, to the Group by the Overdraft Bank on the terms of the
         Bonding Facility Agreement.

         "BONDING FACILITY AGREEMENT"

         means any agreement between a member of the Group and the Overdraft
         Bank relating to the Bonding Facility and any guarantee, performance
         bond or other similar document issued to a third party under the
         Bonding Facility.

         "CREDIT AGREEMENT"

         means the pound sterling 100,000,000 credit agreement dated on or about
         the date of this Deed between (among others) the Chargors and the
         Facility Agent.

         "INVESTMENTS"

         means:

         (a)     any shares in any member of the Group other than the Company;


<PAGE>   92
                                       89



         (b)     any dividend or interest paid or payable in relation to any
                 such shares; and

         (c)     any right, money or property accruing or offered at any time in
                 relation to any such shares by way of redemption, substitution,
                 exchange, bonus or preference under option rights or otherwise.

         "OVERDRAFT BANK"

         means National Westminster Bank Plc in its capacity as provider of the
         Overdraft Facility and Bonding Facility.

         "OVERDRAFT FACILITY"

         means an overdraft facility in a net amount of up to pound sterling
         5,000,000 (or its equivalent in other currencies), or, subject to
         clause 19.7 (Financial Indebtedness) of the Credit Agreement, such
         other amount as the Overdraft Bank and the Company may agree, made
         available, or to be made available, to the Group by the Overdraft Bank
         on the terms of the Overdraft Facility Agreement.

         "OVERDRAFT FACILITY AGREEMENT"

         means any agreement between a member of the Group and the Overdraft
         Bank relating to the Overdraft Facility.

         "PARTY"

         means a party to this Deed.

         "RBS BONDS"

         means the bonds issued by The Royal Bank of Scotland plc under the RBS
         Facility which are outstanding on the date of this Deed.

         "RBS FACILITY"

         means the bonding facility previously made available to the Group by
         The Royal Bank of Scotland plc.

         "RBS PROMISSORY NOTE"

         means the pound sterling 3,250,000 promissory note dated 18th December,
         1998 issued by The Royal Bank of Scotland plc which matures on 2nd
         April, 2001.

         "RECEIVER"

         means a receiver and manager or (if the Facility Agent so specifies in
         the relevant appointment) a receiver, in either case, appointed under
         this Deed.
<PAGE>   93
                                       90



         "SECURED LIABILITIES"

         means all present and future obligations and liabilities (whether
         actual or contingent and whether owed jointly or severally or in any
         other capacity whatsoever) of each Chargor to any Senior Lender under
         or in respect of each Senior Document to which a Chargor is a party,
         except for any obligation which, if it were so included, would result
         in this Deed contravening Section 151 of the Companies Act 1985.

         "SECURITY ASSETS"

         means all assets of each Chargor the subject of any security created by
         this Deed.

         "SECURITY PERIOD"

         means the period beginning on the date of this Deed and ending on the
         date on which all the Secured Liabilities have been unconditionally and
         irrevocably paid and discharged in full.

         "SENIOR DOCUMENTS"

         means the Finance Documents, the Overdraft Facility Agreement, the
         Bonding Facility Agreement, the RBS Bonds and the RBS Promissory Note.

         "SENIOR LENDERS"

         means the Finance Parties and the Overdraft Bank.

1.2      CONSTRUCTION

(a)      Capitalised terms defined in the Credit Agreement have, unless
         expressly defined in this Deed, the same meaning in this Deed.

(b)      The provisions of Clause 1.2 (Construction) of the Credit Agreement
         apply to this Deed as though they were set out in full in this Deed,
         except that references to the Credit Agreement will be construed as
         references to this Deed.

(c)      (i)     The term "Senior Document" includes all amendments and
                 supplements including supplements providing for further
                 advances; and

         (ii)    the term "this Security" means any security created by this
                 Deed.

(d)      Any covenant of a Chargor under this Deed (other than a payment
         obligation) remains in force during the Security Period.

(e)      The terms of the other Senior Documents and of any side letters between
         any Parties in relation to any Senior Document are incorporated in this
         Deed to the extent required to ensure that any purported disposition of
         any freehold or leasehold property contained in this Deed is a valid
         disposition in accordance with Section 2(1) of the Law of Property
         (Miscellaneous Provisions) Act 1989.
<PAGE>   94
                                       91


(f)      If the Facility Agent considers that an amount paid to a Senior Lender
         under a Senior Document is capable of being avoided or otherwise set
         aside on the liquidation or administration of the payer or otherwise,
         then that amount will not be considered to have been irrevocably paid
         for the purposes of this Deed.

(g)      Unless the context otherwise requires, a reference to a Security Asset
         includes the proceeds of sale of that Security Asset.

2.       CREATION OF SECURITY

2.1      GENERAL

(a)      All the security created under this Deed:

         (i)     is created in favour of the Facility Agent;

         (ii)    is security for the payment of all the Secured Liabilities; and

         (iii)   is made with full title guarantee in accordance with the Law of
                 Property (Miscellaneous Provisions) Act 1994.

(b)      If the rights of a Chargor under a document cannot be secured without
         the consent of a party to that document:

         (i)     that Chargor must notify the Facility Agent promptly;

         (ii)    this Security will secure all amounts which that Chargor may
                 receive, or has received, under that document but exclude the
                 document itself; and

         (iii)   unless the Facility Agent otherwise requires, that Chargor must
                 use reasonable endeavours to obtain the consent of the relevant
                 party to that document being secured under this Deed.

(c)      The Facility Agent holds the benefit of this Deed on trust for the
         Senior Lenders.

2.2      INVESTMENTS

         Each Chargor secures by way of a first legal mortgage all Investments
         owned by it or held by any nominee on its behalf.

2.3      FLOATING CHARGE

(a)      Subject to any right of set-off of the Overdraft Bank in connection
         with the Overdraft Facility, each Chargor secures by way of a first
         floating charge all its assets (other than the Investments).

(b)      The Facility Agent may by notice to a Chargor convert the floating
         charge created by that Chargor under this Subclause into a fixed charge
         as regards any of that Chargor's assets specified in that notice, if:
<PAGE>   95
                                       92


         (i)     an Event of Default is outstanding; or

         (ii)    the Facility Agent reasonably considers those assets to be in
                 danger of being seized or sold under any form of distress,
                 attachment, execution or other legal process or to be otherwise
                 in jeopardy.

3.       REPRESENTATIONS - GENERAL

3.1      NATURE OF SECURITY

         Each Chargor represents to each Senior Lender that this Deed creates
         those Security Interests it purports to create and is not liable to be
         amended or otherwise set aside on its liquidation or administration or
         otherwise.

3.2      TIMES FOR MAKING REPRESENTATIONS

(a)      The representations set out in this Deed (including in this Clause) are
         made on the date of this Deed.

(b)      Unless a representation is expressed to be given at a specific date,
         each representation under this Deed is deemed to be repeated by each
         Chargor on each date during the Security Period.

(c)      When a representation is repeated, it is applied to the circumstances
         existing at the time of repetition.

4.       RESTRICTIONS ON DEALINGS

         No Chargor may:

         (a)     create or permit to subsist any Security Interest on any
                 Security Asset; or

         (b)     sell, transfer, licence, lease or otherwise dispose of any
                 Security Asset,

         except as expressly allowed under the Credit Agreement.

5.       INVESTMENTS

5.1      INVESTMENTS

         Each Chargor represents to each Senior Lender that:

         (a)     its Shares and, to the extent applicable, its other
                 Investments, are fully paid;

         (b)     its Shares represent the whole of the issued share capital of:

                 (i)     in the case of Fairclough Homes Group Limited,
                         Fairclough Homes Limited; and

                 (ii)    in the case of Fairclough Homes Limited, Viewton
                         Properties Limited;
<PAGE>   96
                                       93


         (c)     it is the sole legal and beneficial owner of its Investments.

5.2      DEPOSIT

         Each Chargor must:

         (a)     immediately deposit with the Facility Agent, or as the Facility
                 Agent may direct, all certificates and other documents of title
                 or evidence of ownership in relation to any of its Investments;
                 and

         (b)     promptly execute and deliver to the Facility Agent all share
                 transfers and other documents which may be requested by the
                 Facility Agent in order to enable the Facility Agent or its
                 nominees to be registered as the owner or otherwise obtain a
                 legal title to any of its Investments.

5.3      CHANGES TO RIGHTS

         No Chargor may take or allow the taking of any action on its behalf
         which may result in the rights attaching to any of its Investments
         being altered or further shares in any Chargor other than Fairclough
         Homes Group Limited being issued.

5.4      CALLS

(a)      Each Chargor must pay all calls or other payments due and payable in
         respect of any of its Investments.

(b)      If a Chargor fails to do so, the Facility Agent may pay the calls or
         other payments on behalf of that Chargor. That Chargor must immediately
         on request reimburse the Facility Agent for any payment made by the
         Facility Agent under this Subclause.

5.5      OTHER OBLIGATIONS IN RESPECT OF INVESTMENTS

(a)      Each Chargor must promptly copy to the Facility Agent and comply with
         all requests for information which is within its knowledge and which
         are made under section 212 of the Companies Act 1985 or any similar
         provision contained in any articles of association or other
         constitutional document relating to any of its Investments. If it fails
         to do so, the Facility Agent may elect to provide such information as
         it may have on behalf of that Chargor.

(b)      Each Chargor must comply with all other conditions and obligations
         assumed by it in respect of any of its Investments.

(c)      The Facility Agent is not obliged to:

         (i)     perform any obligation of a Chargor;

         (ii)    make any payment, or to make any enquiry as to the nature or
                 sufficiency of any payment received by it or a Chargor; or

         (iii)   present or file any claim or take any other action to collect
                 or enforce the payment of any amount to which it may be
                 entitled under this Deed,
<PAGE>   97
                                       94



                 in respect of any Investment.

5.6      VOTING RIGHTS

(a)      Before this Security becomes enforceable:

         (i)     the voting rights, powers and other rights in respect of the
                 Investments must (if exercisable by the Facility Agent) be
                 exercised in any manner which the relevant Chargor may direct
                 in writing; and

         (ii)    all dividends or other income paid or payable in relation to
                 any Investments must be paid directly to the relevant Chargor.

(b)      After this Security has become enforceable, the Facility Agent may:

         (i)     require that it or its nominee be registered as the owner of
                 the shares; and

         (ii)    exercise (in the name of the relevant Chargor and without any
                 further consent or authority on the part of the relevant
                 Chargor) any voting rights and any powers or rights which may
                 be exercised by the person or persons in whose name any
                 Investment is registered or who is the holder of any Investment
                 or otherwise. This includes all the powers given to trustees by
                 Section 10(3) and (4) of the Trustee Act, 1925, as amended by
                 Section 9 of the Trustee Investment Act, 1961, in respect of
                 securities or property subject to a trust.

6.       WHEN SECURITY BECOMES ENFORCEABLE

6.1      EVENT OF DEFAULT

         This Security will become immediately enforceable if an Event of
         Default is outstanding.

6.2      DISCRETION

         After this Security has become enforceable, the Facility Agent may in
         its absolute discretion enforce all or any part of this Security in any
         manner it sees fit or as the Majority Lenders direct.

6.3      POWER OF SALE

         The power of sale and other powers conferred by Section 101 of the Act,
         as amended by this Deed, will be immediately exercisable at any time
         after this Security has become enforceable.

7.       ENFORCEMENT OF SECURITY

7.1      GENERAL

(a)      For the purposes of all powers implied by statute, the Secured
         Liabilities are deemed to have become due and payable on the date of
         this Deed.
<PAGE>   98
                                       95


(b)      Section 103 of the Act (restricting the power of sale) and Section 93
         of the Act (restricting the right of consolidation) do not apply to
         this Security.

(c)      The statutory powers of leasing conferred on the Facility Agent are
         extended so as to authorise the Facility Agent to lease, make
         agreements for leases, accept surrenders of leases and grant options as
         the Facility Agent may think fit and without the need to comply with
         any provision of section 99 or 100 of the Act.

7.2      NO LIABILITY AS MORTGAGEE IN POSSESSION

         Neither the Facility Agent nor any Receiver will be liable, by reason
         of entering into possession of a Security Asset, to account as
         mortgagee in possession or for any loss on realisation or for any
         default or omission for which a mortgagee in possession might be
         liable.

7.3      PRIVILEGES

         Each Receiver and the Facility Agent is entitled to all the rights,
         powers, privileges and immunities conferred by the Act on mortgagees
         and receivers duly appointed under the Act, except that Section 103 of
         the Act does not apply.

7.4      PROTECTION OF THIRD PARTIES

         No person (including a purchaser) dealing with the Facility Agent or a
         Receiver or its or his agents will be concerned to enquire:

         (a)     whether the Secured Liabilities have become payable;

         (b)     whether any power which the Facility Agent or a Receiver is
                 purporting to exercise has become exercisable or is being
                 properly exercised;

         (c)     whether any money remains due under the Senior Documents; or

         (d)     how any money paid to the Facility Agent or to that Receiver is
                 to be applied.

7.5      REDEMPTION OF PRIOR MORTGAGES

(a)      At any time after this Security has become enforceable, the Facility
         Agent may:

         (i)     redeem any prior Security Interest against any Security Asset;
                 and/or

         (ii)    procure the transfer of that Security Interest to itself;
                 and/or

         (iii)   settle and pass the accounts of the prior mortgagee, chargee or
                 encumbrancer; any accounts so settled and passed will be, in
                 the absence of manifest error, conclusive and binding on each
                 Chargor.

(b)      Each Chargor must pay to the Facility Agent, immediately on demand, the
         costs and expenses incurred by the Facility Agent in connection with
         any such redemption and/or transfer, including the payment of any
         principal or interest.
<PAGE>   99
                                       96


7.6      CONTINGENCIES

         If this Security is enforced at a time when no amount is due under the
         Senior Documents but at a time when amounts may or will become due, the
         Facility Agent (or the Receiver) may pay the proceeds of any recoveries
         effected by it into a suspense account.

8.       RECEIVER

8.1      APPOINTMENT OF RECEIVER

(a)      The Facility Agent may appoint any one or more persons to be a Receiver
         of all or any part of the Security Assets if:

         (i)     this Security has become enforceable; or

         (ii)    a Chargor so requests the Facility Agent in writing at any
                 time.

(b)      Any appointment under paragraph (a) above may be by deed, under seal or
         in writing under its hand.

(c)      Section 109(1) of the Act does not apply to this Deed.

8.2      REMOVAL

         The Facility Agent may by writing under its hand (subject to any
         requirement for an order of the court in the case of an administrative
         receiver) remove any Receiver appointed by it and may, whenever it
         thinks fit, appoint a new Receiver in the place of any Receiver whose
         appointment may for any reason have terminated.

8.3      REMUNERATION

         The Facility Agent may fix the remuneration of any Receiver appointed
         by it and the maximum rate specified in Section 109(b) of the Act will
         not apply.

8.4      AGENT OF EACH CHARGOR

(a)      A Receiver will be deemed to be the agent of each Chargor for all
         purposes and accordingly will be deemed to be in the same position as a
         Receiver duly appointed by a mortgagee under the Act. Each Chargor
         alone is responsible for the contracts, engagements, acts, omissions,
         defaults and losses of a Receiver and for liabilities incurred by a
         Receiver.

(b)      No Senior Lender will incur any liability (either to a Chargor or to
         any other person) by reason of the appointment of a Receiver or for any
         other reason.

8.5      RELATIONSHIP WITH FACILITY AGENT

         To the fullest extent allowed by law, any right, power or discretion
         conferred by this Deed (either expressly or impliedly) or by law on a
         Receiver may after this Security becomes enforceable be exercised by
         the Facility Agent in relation to any Security Asset without first
         appointing a Receiver and notwithstanding the appointment of a
         Receiver.
<PAGE>   100
                                       97



9.       POWERS OF RECEIVER

9.1      GENERAL

(a)      A Receiver has all of the rights, powers and discretions set out below
         in this Clause in addition to those conferred on it by any law,
         including all the rights, powers and discretions conferred on a
         receiver under the Act and a receiver or an administrative receiver
         under the Insolvency Act, 1986.

(b)      If there is more than one Receiver holding office at the same time,
         each Receiver may (unless the document appointing him states otherwise)
         exercise all of the powers conferred on a Receiver under this Deed
         individually and to the exclusion of any other Receiver.

9.2      POSSESSION

         A Receiver may take immediate possession of, get in and collect any
         Security Asset.

9.3      CARRY ON BUSINESS

         A Receiver may carry on the business of any Chargor in any manner he
         thinks fit.

9.4      EMPLOYEES

(a)      A Receiver may appoint and discharge managers, officers, agents,
         accountants, servants, workmen and others for the purposes of this Deed
         upon such terms as to remuneration or otherwise as he thinks fit.

(b)      A Receiver may discharge any person appointed by any Chargor.

9.5      BORROW MONEY

         A Receiver may raise and borrow money either unsecured or on the
         security of any Security Asset either in priority to this Security or
         otherwise and generally on any terms and for whatever purpose which he
         thinks fit.

9.6      SALE OF ASSETS

(a)      A Receiver may sell, exchange, convert into money and realise any
         Security Asset by public auction or private contract and generally in
         any manner and on any terms which he thinks fit.

(b)      The consideration for any such transaction may consist of cash,
         debentures or other obligations, shares, stock or other valuable
         consideration and any such consideration may be payable in a lump sum
         or by instalments spread over any period which he thinks fit.

(c)      Fixtures, other than landlord's fixtures, may be severed and sold
         separately from the property containing them without the consent of the
         relevant Chargor.
<PAGE>   101
                                       98


9.7      LEASES

         A Receiver may let any Security Asset for any term and at any rent
         (with or without a premium) which he thinks fit and may accept a
         surrender of any lease or tenancy of any Security Asset on any terms
         which he thinks fit (including the payment of money to a lessee or
         tenant on a surrender).

9.8      COMPROMISE

         A Receiver may settle, adjust, refer to arbitration, compromise and
         arrange any claim, account, dispute, question or demand with or by any
         person who is or claims to be a creditor of any Chargor or relating in
         any way to any Security Asset.

9.9      LEGAL ACTIONS

         A Receiver may bring, prosecute, enforce, defend and abandon any
         action, suit or proceedings in relation to any Security Asset which he
         thinks fit.

9.10     RECEIPTS

         A Receiver may give a valid receipt for any moneys and execute any
         assurance or thing which may be proper or desirable for realising any
         Security Asset.

9.11     SUBSIDIARIES

         A Receiver may form a Subsidiary of any Chargor and transfer to that
         Subsidiary any Security Asset.

9.12     DELEGATION

         A Receiver may delegate his powers in accordance with this Deed.

9.13     LENDING

         A Receiver may lend money or advance credit to any customer of any
         Chargor.

9.14     PROTECTION OF ASSETS

         A Receiver may:

         (a)     effect any repair or insurance and do any other act which any
                 Chargor might do in the ordinary conduct of its business to
                 protect or improve any Security Asset;

         (b)     commence and/or complete any building operation; and

         (c)     apply for and maintain any planning permission, building
                 regulation approval or any other authorisation,

         in each case as he thinks fit.



<PAGE>   102
                                       99


9.15     OTHER POWERS

         A Receiver may:

         (a)     do all other acts and things which he may consider desirable or
                 necessary for realising any Security Asset or incidental or
                 conducive to any of the rights, powers or discretions conferred
                 on a Receiver under or by virtue of this Deed or law;

         (b)     exercise in relation to any Security Asset all the powers,
                 authorities and things which he would be capable of exercising
                 if he were the absolute beneficial owner of that Security
                 Asset; and

         (c)     use the name of any Chargor for any of the above purposes.

10.      APPLICATION OF PROCEEDS

         Any moneys received by the Facility Agent or any Receiver after this
         Security has become enforceable must be applied in the following order
         of priority:

         (a)     in or towards payment of or provision for all costs and
                 expenses incurred by the Facility Agent or any Receiver under
                 or in connection with this Deed and of all remuneration due to
                 any Receiver under or in connection with this Deed;

         (b)     in or towards payment of or provision for the Secured
                 Liabilities; and

         (c)     in payment of the surplus (if any) to any Chargor or other
                 person entitled to it.

         This Clause is subject to the payment of any claims having priority
         over this Security. This Clause does not prejudice the right of any
         Senior Lender to recover any shortfall from the Chargor.

11.      EXPENSES AND INDEMNITY

         Each Chargor must:

         (a)     to extent not recovered by the relevant person under Clause 25
                 (Indemnities and Break Costs) or Clause 26 (Expenses) of the
                 Credit Agreement, immediately on demand pay all costs and
                 expenses (including legal fees) incurred in connection with
                 this Deed by any Senior Lender, Receiver, attorney, manager,
                 agent or other person appointed by the Facility Agent under
                 this Deed; and

         (b)     keep each of them indemnified against any failure or delay in
                 paying those costs or expenses; this includes any arising from
                 any actual or alleged breach by any person of any law or
                 regulation, whether relating to the environment or otherwise.


<PAGE>   103
                                      100



12.      DELEGATION

12.1     POWER OF ATTORNEY

         The Facility Agent or any Receiver may delegate by power of attorney or
         in any other manner to any person any right, power or discretion
         exercisable by it under this Deed.

12.2     INTEREST PERIODS

         Any such delegation may be made upon any terms (including power to
         sub-delegate) which the Facility Agent or any Receiver may think fit.

12.3     LIABILITY

         Neither the Facility Agent nor any Receiver will be in any way liable
         or responsible to any Chargor for any loss or liability arising from
         any act, default, omission or misconduct on the part of any delegate or
         sub-delegate.

13.      FURTHER ASSURANCES

         Each Chargor must, at its own expense, take whatever action the
         Facility Agent or a Receiver may require for:

         (a)     creating, perfecting or protecting any security intended to be
                 created by this Deed; or

         (b)     after the Security has become enforceable facilitating the
                 realisation of any Security Asset, or the exercise of any
                 right, power or discretion exercisable, by the Facility Agent
                 or any Receiver or any of its delegates or sub-delegates in
                 respect of any Security Asset.

         This includes:

         (i)     the execution of any transfer, conveyance, assignment or
                 assurance of any property, whether to the Facility Agent or to
                 its nominee; or

         (ii)    the giving of any notice, order or direction and the making of
                 any registration,

         which, in any such case, the Facility Agent may think expedient.

14.      POWER OF ATTORNEY

         Each Chargor, by way of security, irrevocably and severally appoints
         the Facility Agent, each Receiver and any of its delegates or
         sub-delegates to be its attorney to take any action which that Chargor
         is obliged to take under this Deed. Each Chargor ratifies and confirms
         whatever any attorney does or purports to do under its appointment
         under this Clause.

<PAGE>   104
                                      101

15.      MISCELLANEOUS

15.1     COVENANT TO PAY

         Each Chargor must pay or discharge the Secured Liabilities in the
         manner provided for in the Senior Documents.

15.2     TACKING

         Each Senior Lender must perform its obligations under the Senior
         Documents (including any obligation to make available further
         advances).

15.3     NEW ACCOUNTS

(a)      If any subsequent charge or other interest affects any Security Asset,
         a Senior Lender may open a new account with a Chargor.

(b)      If a Senior Lender does not open a new account, it will nevertheless be
         treated as if it had done so at the time when it received or was deemed
         to have received notice of that charge or other account.

(c)      As from that time all payments made to a Senior Lender will be credited
         or be treated as having been credited to the new account and will not
         operate to reduce any Secured Liability.

15.4     TIME DEPOSITS

         Without prejudice to any right of set-off any Senior Lender may have
         under any other Senior Document or otherwise, if any time deposit
         matures on any account a Chargor has with any Senior Lender within the
         Security Period when:

         (a)     this Security has become enforceable; and

         (b)     no Secured Liability is due and payable,

         that time deposit will automatically be renewed for any further
         maturity which that Senior Lender considers appropriate.

15.5     NOTICE OF ASSIGNMENT

         This Deed constitutes notice in writing to each Chargor of any charge
         or assignment of a debt owed by that Chargor to any other member of the
         Group and contained in any other Security Document.

16.      RELEASE

         At the end of the Security Period, the Senior Lenders must, at the
         request and cost of a Chargor, promptly take whatever action is
         necessary to release its Security Assets from this Security.
<PAGE>   105
                                      102


17.      GOVERNING LAW

         This Deed is governed by English law.

         This Deed has been entered into as a deed on the date stated at the
         beginning of this Deed.
<PAGE>   106
                                      103




                              SCHEDULE 1 - CHARGORS






NAME OF CHARGOR                       REGISTERED NUMBER

Fairclough Homes Group Limited              2804113

Fairclough Homes Limited                    1987689

Viewton Properties Limited                  2436950

<PAGE>   107
                                      104



                                   SCHEDULE 2

                                     PART I

                      FORM OF LETTER OF NON-CRYSTALLISATION



To [RELEVANT CHARGOR] (the "COMPANY")


For the attention of:                                             [DATE]

Dear Sirs,

SECURITY AGREEMENT (THE "SECURITY AGREEMENT") DATED [           ] MARCH, 2001
BETWEEN THE COMPANY AND THE ROYAL BANK OF SCOTLAND PLC (THE "FACILITY AGENT").

We the Facility Agent, confirm that the floating charge created by the Company
under Clause 2.3 (Floating Charge) of the Security Agreement, has not been
converted into a fixed charge.

Yours faithfully,




For............................................
THE ROYAL BANK OF SCOTLAND PLC

<PAGE>   108
                                      105



                                     PART II

                         FORM OF DEED OF PARTIAL RELEASE





                             DEED OF PARTIAL RELEASE




                                  DATED [DATE]




                                     BETWEEN




                                    [COMPANY]




                                       AND




                         THE ROYAL BANK OF SCOTLAND PLC











                                  ALLEN & OVERY
                                     London


<PAGE>   109
                                      106


THIS DEED OF RELEASE IS DATED [DATE] BETWEEN:

(1)      [CHARGOR] (the "CHARGOR") (Registered No. [                    ]); and

(2)      THE ROYAL BANK OF SCOTLAND PLC (the "FACILITY AGENT").

BACKGROUND

(A)      Under the Security Agreement (defined below), the Chargor, as security
         for the payment of the Secured Liabilities, charged all its assets in
         favour of the Facility Agent.

(B)      It is intended that this document takes effect as a deed
         notwithstanding the fact that a party may only execute this document
         under hand.

IT IS AGREED as follows:


1.       INTERPRETATION

1.1      DEFINITIONS

         In this Deed:

         "RELEASED ASSETS"

         means the assets detailed in Schedule 1.

         "SECURITY AGREEMENT"

         means the security agreement dated [ ] March, 2001, between amongst
         others, the Chargor and the Facility Agent.

1.2      CONSTRUCTION

(a)      Capitalised terms defined in the Security Agreement have, unless
         expressly defined in this Deed, the same meaning in this Deed.

(b)      The provisions of Clause 1.2 (Construction) of the Credit Agreement
         apply to this Deed as though they were set out in full in this Deed
         except that references to the Credit Agreement are to be construed as
         references to this Deed.

2.       RELEASE

         Without prejudice to the other obligations of the Chargors under the
         Security Agreement, the Facility Agent irrevocably and unconditionally
         releases and discharges the Released Assets from all Security Interests
         created by the Chargor over the Released Assets under the Security
         Agreement.

3.       GOVERNING LAW

         This Deed is governed by English law.

This Deed has been entered into as a deed on the date stated at the beginning of
this Deed.
<PAGE>   110
                                      107



                                   SCHEDULE 1

                                 RELEASED ASSETS


<PAGE>   111
                                      108



                                   SIGNATORIES


THE COMMON SEAL of                  )
[      ] was                        )
affixed to this Deed in             )
the presence of:                    )


Director.............................................


Director/Secretary...................................


THE FACILITY AGENT

THE ROYAL BANK OF SCOTLAND PLC

By:
<PAGE>   112
                                      109



                                   SIGNATORIES





CHARGORS


EXECUTED AS A DEED by               )
FAIRCLOUGH HOMES GROUP              )
LIMITED                             )
acting by                           )



         Director

         Director/Secretary




EXECUTED AS A DEED by               )
FAIRCLOUGH HOMES                    )
LIMITED                             )
acting by                           )



         Director

         Director/Secretary

<PAGE>   113
                                      110





EXECUTED AS A DEED by               )
VIEWTON PROPERTIES                  )
LIMITED                             )
acting by                           )



         Director

         Director/Secretary




FACILITY AGENT



THE ROYAL BANK OF SCOTLAND PLC



By:


<PAGE>   114
                                      111


                                   SCHEDULE 11

                     FORM OF LEGAL OPINION OF ALLEN & OVERY

To:      The Finance Parties named as
         original parties to the Credit Agreement
         (as defined below).

Dear Sirs,                                                 [           ], 2001

  FAIRCLOUGH HOMES GROUP LIMITED - POUND STERLING 100,000,000 CREDIT AGREEMENT
                DATED 29TH MARCH, 2001 (THE "CREDIT AGREEMENT")

We have received instructions from the Arranger in connection with the Credit
Agreement.

DEFINED TERMS

In this opinion:

"AGREEMENT"

means the Credit Agreement or the Security Agreement;

"SECURITY ASSETS"

has, in relation to the Security Agreement, the meaning given to it in the
Security Agreement; and

terms defined in the Credit Agreement have the same meaning in this opinion.

DOCUMENTS AND SEARCHES

For the purposes of this opinion we have examined the following documents:

(a)      a signed copy of the Credit Agreement;

(b)      a signed copy of the Security Agreement;

(c)      a certified copy of the memorandum and articles of association and
         certificate of incorporation of each Original Obligor;

(d)      a certified copy of the minutes of a meeting of the board of directors
         of each Original Obligor held on [             ];

(e)      a certified copy of a resolution, signed by all the holders of the
         issued or allotted shares in each Original Guarantor, dated [       ];
         and

(f)      a certificate of the Company confirming, amongst other things, that the
         entry into and performance of the Agreements will not contravene any
         borrowing or guarantee limit contained in the articles of association
         of any Original Obligor.

On [         ] we carried out a search of each Original Obligor at the Companies
Registry. On [      ] we made a telephone search of each Original Obligor at the
winding-up petitions at the Companies court.
<PAGE>   115
                                      112


The above are the only documents or records we have examined and the only
searches and enquiries we have carried out for the purposes of this opinion.

ASSUMPTIONS

We assume that:

(a)      each Original Obligor is not unable to pay its debts within the meaning
         of section 123 of the Insolvency Act, 1986 at the time it enters into
         an Agreement and will not as a result of any Agreement be unable to pay
         its debts within the meaning of that section;

(b)      no step has been taken to wind up or dissolve any Original Obligor, put
         any Original Obligor into administration or appoint a receiver,
         administrator, administrative receiver, trustee in bankruptcy or
         similar officer in respect of it or any of its assets although the
         searches of the Companies Registry referred to above gave no indication
         that any winding-up, dissolution or administration order or appointment
         of a receiver, administrator, administrative receiver, trustee in
         bankruptcy or similar officer has been made;

(c)      all signatures and documents are genuine;

(d)      all documents are and remain up-to-date;

(e)      the correct procedure was carried out at all the board meetings
         referred to above; for example, there was a valid quorum, all relevant
         interests of directors were declared and the resolutions were duly
         passed at each meeting;

(f)      any restrictions on the ability of an Original Obligor to borrow or
         guarantee contained in its Articles of Association would not be
         contravened by the entry into and performance by it of any Agreement to
         which it is a party;

(g)      the Agreements have been duly executed on behalf of the Original
         Obligors party to them by the person(s) authorised by the resolutions
         passed at the relevant meeting referred to above;

(h)      each Agreement is a legally binding, valid and enforceable obligation
         of each party to it other than the Original Obligor;

(i)      the guarantee contained in the Credit Agreement was given for the
         legitimate purposes of each Original Guarantor and the giving of the
         guarantee may reasonably be regarded as having been in its interests;
         and

(j)      no foreign law affects the conclusions stated below.

OPINION

Subject to the qualifications set out below and to any matters not disclosed to
us, it is our opinion that, so far as the present laws of England are concerned:

1.       STATUS: Each Original Obligor is a company incorporated with limited
         liability under the laws of England and is not in liquidation.

2.       POWERS AND AUTHORITY: Each Original Obligor has the corporate power to
         enter into and perform the Agreements to which it is a party and has
         taken all necessary corporate action to authorise the execution,
         delivery and performance of those Agreements.
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                                      113


3.       LEGAL VALIDITY: Each Agreement to which any Original Obligor is a party
         constitutes its legally binding, valid and enforceable obligation.

4.       NON-CONFLICT: The entry into and performance by each Original Obligor
         of each Agreement to which it is a party will not violate any provision
         of (i) any existing English law applicable to companies generally, or
         (ii) its memorandum or articles of association.

5.       CONSENTS: No authorisations of governmental, judicial or public bodies
         or authorities in England are required by any Original Obligor in
         connection with the performance, validity or enforceability of its
         payment obligations under each Agreement to which it is a party.

6.       TAXES: All payments due from any Original Obligor under the Credit
         Agreement may be made without deduction of any U.K. Taxes, if, in the
         case of interest:

         (a)     (i)     the person that advanced the participation in the Loan
                         to which the interest relates was a bank for the
                         purpose of Section 349 of the Income and Corporation
                         Taxes Act 1988 (as currently defined in section 840A of
                         the Income and Corporation Taxes Act 1988) at the time
                         the Loan was made; and

                 (ii)    the person beneficially entitled to that interest is
                         within the charge to U.K. corporation tax as regards
                         that interest at the time the interest is paid; or

         (b)     the interest is payable to a Treaty Lender and the Financial
                 Intermediaries and Claims Office has given the necessary
                 authorisation.

7.       REGISTRATION REQUIREMENTS: Except for registration of the Security
         Agreement at the appropriate registries, it is not necessary or
         advisable to file, register or record any Agreement in any public place
         or elsewhere in England.

8.       STAMP DUTIES: Except for any registration fees payable at the Companies
         Registry in respect of the Security Agreement, no stamp, registration
         or similar tax or charge is payable in England in respect of any
         Agreement.

9.       SECURITY: Subject to due registration where required, the Security
         Agreement creates security interests in the Security Assets concerned.

QUALIFICATIONS

This opinion is subject to the following qualifications:

(a)      This opinion is subject to all insolvency and other laws affecting the
         rights of creditors generally.

(b)      No opinion is expressed on matters of fact.

(c)      It is arguable that any provisions contained in the Agreements
         requiring a person to issue certain directions to a receiver appointed
         by him, or requiring him to ensure that such a receiver acts in a
         specified manner, or otherwise intended to restrict the freedom of a
         receiver to act at his discretion in the exercise of powers conferred
         upon him, may have the effect of rendering such a receiver the agent of
         the person appointing him (rather than of the company over whose assets
         he is appointed). Such person would thereby become liable for
         liabilities incurred by the receiver.
<PAGE>   117
                                      114


(d)      Clause 1.2(f) (Construction) of the Security Agreement and other
         provisions of the Agreements relating to or having the effect of
         permitting retention of security after payment in full may not be
         effective for that purpose.

(e)      This opinion, in so far as it relates to the obligations of and
         security given by the Obligors (in the case of the Borrower, other than
         in their capacity as Borrowers) under the Agreements, is given on the
         assumption that any security given by them under the Agreements has
         been given in good faith and for the purpose of carrying on the
         Obligors' business and that there are reasonable grounds for believing
         that the giving of such guarantees and security will benefit the
         relevant Obligor.

(f)      We express no opinion in respect of the relevant priority rules for any
         security created by the Agreements. In so far as English laws apply
         with regard to this matter, such matters are complex and depend partly
         upon the type of asset and the type of charge. A lengthy dissertation
         on this subject is not considered appropriate for an opinion of this
         kind. However, without being comprehensive, we would particularly draw
         your attention to the following points arising under English law (so
         far as applicable):

         (i)     a Security Interest (if any) created on Security Assets prior
                 to the security created thereover by the relevant Agreements
                 may rank prior to the security created over such Security
                 Assets by such Agreements in favour of the Facility Agent;

         (ii)    certain statutory preferences, fixed charges, possessory liens,
                 preferred creditors and other priorities arising by law may
                 have a prior ranking;

         (iii)   any security created under the relevant Agreements may be
                 defeated by interests acquired by third parties without notice
                 of the charges created thereby. To the extent that the Security
                 Assets include property acquired after the date of the relevant
                 Agreements, the charges created thereunder may be subject to
                 any security interests and other rights affecting such property
                 on the acquisition thereof. To the extent that any Security
                 Assets are subject to a floating charge, such charge will take
                 effect subject to any charges or other rights (including
                 creditors' processes) validly created or arising prior to the
                 crystallisation of such floating charge;

         (iv)    insofar as the Security Assets constitute debts due from and
                 other rights arising against third parties any charges created
                 by the Agreements may be subject to rights (e.g. of set-off) of
                 such third parties and may be invalid to the extent that
                 charges or assignments of those debts or other rights are
                 prohibited. Furthermore, a subsequent mortgagee or assignee may
                 acquire priority over the charges created by the Agreements if
                 the subsequent mortgagee or assignee gives prior notice to the
                 third party;

         (v)     any fixed charges over book debts and bank accounts contained
                 in the Agreements may, depending upon the degree of control
                 exercised by the Facility Agent over the chargors' powers to
                 deal with such book debts and the proceeds thereof and/or such
                 bank accounts, be construed instead as a floating charge;

         (vi)    there have been a number of cases where fixed charges over book
                 debts have been upheld or apparently accepted by the courts.
                 However, these cases mostly involve charges in favour of
                 clearing banks whose de facto control for these purposes may
                 more easily be accepted or assumed by a court. Whilst we
                 consider that there is a reasonable prospect that any fixed
                 charges will not be challenged, if they were to be



<PAGE>   118
                                      115


                 challenged there is a risk of those cases being distinguished
                 on control grounds and of any fixed charges over book debts
                 being held to take effect only as floating charges;

         (vii)   the judgment in the Court of Appeal case RE NEW BULLAS TRADING
                 LTD does however provide grounds for optimism that any
                 purported fixed charges over book debts and bank accounts
                 contained in the Agreements would be given effect as such.
                 However, in view of the unusual factual situation in that case
                 and the unusual drafting of the relevant security documents,
                 that case might be distinguished;

         (viii)  insofar as the Security Assets constitute shares in companies
                 incorporated in the United Kingdom, any security created by the
                 Agreements will only constitute an equitable charge, until such
                 shares are registered in the name of the Facility Agent or its
                 nominee; and

         (ix)    insofar as the Security Assets constitute interests in real
                 property situated in England, no priority as against third
                 parties will generally be obtained pursuant to the Agreements
                 unless and until due registration is effected at H.M. Land
                 Charges Registry or H.M. Land Registry.

(g)      We express no opinion as to the title of any Obligor to any of the
         Security Assets, as to the nature of the security created by the
         Agreements over particular assets (whether fixed or floating), as to
         registration requirements or as to the marketability of or rights of
         enforcement over the Security Assets. We have conducted no due
         diligence in relation to the title of any Obligor to any Security Asset
         for the purposes of the Agreements.

(h)      No opinion is expressed as to any other restriction affecting any
         Security Asset or the security created by the Security Agreement.

(i)      The term "ENFORCEABLE" means that a document is of a type and form
         enforced by the English courts. It does not mean that each obligation
         will be enforced in accordance with its terms. Certain rights and
         obligations may be qualified by the non-conclusivity of certificates,
         doctrines of good faith and fair conduct, the availability of equitable
         remedies and other matters, but in our view these qualifications would
         not defeat your legitimate expectations in any material respect.

This opinion is given for your sole benefit and may not be relied upon by or
disclosed to any other person.

Yours faithfully
<PAGE>   119
                                      116



                                   SIGNATORIES



COMPANY

FAIRCLOUGH HOMES GROUP LIMITED

By:      S.A. BASELEY



ORIGINAL BORROWERS

FAIRCLOUGH HOMES LIMITED

By:      S.A. BASELEY





ORIGINAL GUARANTORS

FAIRCLOUGH HOMES GROUP LIMITED

By:      S.A. BASELEY



FAIRCLOUGH HOMES LIMITED

By:      S.A. BASELEY



VIEWTON PROPERTIES LIMITED

By:      S.A. BASELEY





ARRANGER

THE ROYAL BANK OF SCOTLAND PLC

By:      J.H.M. HARE



<PAGE>   120
                                      117



ORIGINAL LENDER

NATIONAL WESTMINSTER BANK PLC

By:      PAUL DAVEY





FACILITY AGENT

THE ROYAL BANK OF SCOTLAND PLC

By:      J.H.M. HARE