<PAGE>

                                                                     Exhibit 4.2


                                 A/B EXCHANGE
                         REGISTRATION RIGHTS AGREEMENT


                          Dated as of October 2, 2000
                                 by and among

                        K. Hovnanian Enterprises, Inc.
                          Hovnanian Enterprises, Inc.
                        And certain of its Subsidiaries

                                      and

              Donaldson, Lufkin & Jenrette Securities Corporation
                           Salomon Smith Barney Inc.
                           PNC Capital Markets, Inc.



--------------------------------------------------------------------------------
<PAGE>

     This Registration Rights Agreement (this "Agreement") is made and entered
                                               ---------
into as of September __, 2000, by and among K. Hovnanian Enterprises, Inc., a
New Jersey corporation (the "Company"), Hovnanian Enterprises, Inc., a Delaware
                             -------
corporation (the "Hovnanian"), and various subsidiary guarantors party hereto
                  ---------
(together with Hovnanian, the "Guarantors" and Donaldson, Lufkin & Jenrette
                               ----------
Securities Corporation, Salomon Smith Barney Inc., PNC Capital Markets, Inc.
(each an "Initial Purchaser" and, collectively, the "Initial Purchasers"), each
          -----------------                          ------------------
of whom has agreed to purchase the Company's 10 1/2 % Series A Senior Notes due
2007 (the "Series A Notes") pursuant to the Purchase Agreement (as defined
           --------------
below).


     This Agreement is made pursuant to the Purchase Agreement, dated September
27, 2000, (the "Purchase Agreement"), by and among the Company, the Guarantors
                ------------------
and the Initial Purchasers. In order to induce the Initial Purchasers to
purchase the Series A Notes, the Company has agreed to provide the registration
rights set forth in this Agreement. The execution and delivery of this Agreement
is a condition to the obligations of the Initial Purchasers set forth in Section
9 of the Purchase Agreement. Capitalized terms used herein and not otherwise
defined shall have the meaning assigned to them the Indenture, dated October 2,
2000 between the Company, the Guarantors and First Union National Bank, as
Trustee, relating to the Series A Notes and the Series B Notes (the
"Indenture").
 ---------

     The parties hereby agree as follows:

SECTION 1.  DEFINITIONS

     As used in this Agreement, the following capitalized terms shall have the
following meanings:

     Act: The Securities Act of 1933, as amended.
     ---

     Affiliate: As defined in Rule 144 of the Act.
     ---------

     Broker-Dealer: Any broker or dealer registered under the Exchange Act.
     -------------

     Certificated Securities: Definitive Notes, as defined in the Indenture.
     -----------------------

     Closing Date: The date hereof.
     ------------

     Commission: The Securities and Exchange Commission.
     ----------

     Consummate: An Exchange Offer shall be deemed "Consummated" for purposes
     ----------
of this Agreement upon the occurrence of (a) the filing and effectiveness under
the Act of the Exchange Offer Registration Statement relating to the Series B
Notes to be issued in the Exchange Offer, (b) the maintenance of such Exchange
Offer Registration Statement continuously effective and the keeping of the
Exchange Offer open for a period not less than the period required pursuant to
Section 3(b) hereof and (c) the delivery by the Company to the Registrar under
the Indenture of Series B Notes in the same aggregate principal amount as the
aggregate principal amount of Series A Notes tendered by Holders thereof
pursuant to the Exchange Offer.

     Consummation Deadline: As defined in Section 3(b) hereof.
     ---------------------

     Effectiveness Deadline: As defined in Sections 3(a) and 4(a) hereof.
     ----------------------

     Exchange Act: The Securities Exchange Act of 1934, as amended.
     ------------

                                       1
<PAGE>

     Exchange Offer: The exchange and issuance by the Company of a principal
     --------------
amount of Series B Notes (which shall be registered pursuant to the Exchange
Offer Registration Statement) equal to the outstanding principal amount of
Series A Notes that are tendered by such Holders in connection with such
exchange and issuance.

     Exchange Offer Registration Statement: The Registration Statement
     -------------------------------------
relating to the Exchange Offer, including the related Prospectus.

     Exempt Resales: The transactions in which the Initial Purchasers propose to
     --------------
sell the Series A Notes to certain "qualified institutional buyers," as such
term is defined in Rule 144A under the Act and pursuant to Regulation S under
the Act.

     Filing Deadline: As defined in Sections 3(a) and 4(a) hereof.
     ---------------

     Holders: As defined in Section 2 hereof.
     -------

     Prospectus: The prospectus included in a Registration Statement at the
     ----------
time such Registration Statement is declared effective, as amended or
supplemented by any prospectus supplement and by all other amendments thereto,
including post-effective amendments, and all material incorporated by reference
into such Prospectus.

     Recommencement Date: As defined in Section 6(d) hereof.
     -------------------

     Registration Default: As defined in Section 5 hereof.
     --------------------

     Registration Statement: Any registration statement of the Company and the
     ----------------------
Guarantors relating to (a) an offering of Series B Notes pursuant to an Exchange
Offer or (b) the registration for resale of Transfer Restricted Securities
pursuant to the Shelf Registration Statement, in each case, (i) that is filed
pursuant to the provisions of this Agreement and (ii) including the Prospectus
included therein, all amendments and supplements thereto (including post-
effective amendments) and all exhibits and material incorporated by reference
therein.

     Regulation S: Regulation S promulgated under the Act.
     ------------

     Rule 144: Rule 144 promulgated under the Act.
     --------

     Series B Notes: The Company's 10 1/2 % Series B Senior Notes due 2007 to
     --------------
be issued pursuant to the Indenture: (i) in the Exchange Offer or (ii) as
contemplated by Section 4 hereof.

     Shelf Registration Statement: As defined in Section 6(b) hereof.
     ----------------------------

     Suspension Notice: As defined in Section 6(d) hereof.
     -----------------

     TIA: The Trust Indenture Act of 1939 (15 U.S.C. Section 77aaa-77bbbb) as
     ---
in effect on the date of the Indenture.

     Transfer Restricted Securities: Each Series A Note, until the earliest to
     ------------------------------
occur of (a) the date on which such Series A Note is exchanged in the Exchange
Offer for a Series B Note which is entitled to be resold to the public by the
Holder thereof without complying with the prospectus delivery requirements of
the Act, (b) the date on which such Series A Note has been disposed of in
accordance with a Shelf Registration Statement (and the purchasers thereof have
been issued Series B Notes), or (c) the date on which such Series A Note is
distributed to the public pursuant to Rule 144 under the Act (and purchasers
thereof have been issued Series B Notes) and each Series B Note until the date
on which such Series B Note is disposed of by a Broker-Dealer pursuant to the
"Plan of

                                       2
<PAGE>

Distribution" contemplated by the Exchange Offer Registration Statement
(including the delivery of the Prospectus contained therein).

SECTION 2.  HOLDERS

     A Person is deemed to be a holder of Transfer Restricted Securities (each,
a "Holder") whenever such Person owns Transfer Restricted Securities.
   ------

SECTION 3.  REGISTERED EXCHANGE OFFER

     (a)  Unless the Exchange Offer shall not be permitted by applicable federal
law (after the procedures set forth in Section 6(a)(i) below have been complied
with), the Company and the Guarantors shall (i) cause the Exchange Offer
Registration Statement to be filed with the Commission as soon as practicable
after the Closing Date, but in no event later than 90 days after the Closing
Date (such 90th day being the "Filing Deadline"), (ii) use its reasonable best
                               ---------------
efforts to cause such Exchange Offer Registration Statement to become effective
at the earliest possible time, but in no event later than 150 days after the
Closing Date (such 150th day being the "Effectiveness Deadline"), (iii) in
                                        ----------------------
connection with the foregoing, (A) file all pre-effective amendments to such
Exchange Offer Registration Statement as may be necessary in order to cause it
to become effective, (B) file, if applicable, a post-effective amendment to such
Exchange Offer Registration Statement pursuant to Rule 430A under the Act and
(C) cause all necessary filings, if any, in connection with the registration and
qualification of the Series B Notes to be made under the Blue Sky laws of such
jurisdictions as are necessary to permit Consummation of the Exchange Offer, and
(iv) upon the effectiveness of such Exchange Offer Registration Statement,
commence and Consummate the Exchange Offer. The Exchange Offer shall be on the
appropriate form permitting (i) registration of the Series B Notes to be offered
in exchange for the Series A Notes that are Transfer Restricted Securities and
(ii) resales of Series B Notes by Broker-Dealers that tendered into the Exchange
Offer Series A Notes that such Broker-Dealer acquired for its own account as a
result of market making activities or other trading activities (other than
Series A Notes acquired directly from the Company or any of its Affiliates) as
contemplated by Section 3(c) below.

     (b)  The Company and the Guarantors shall use their respective reasonable
best efforts to cause the Exchange Offer Registration Statement to be effective
continuously, and shall keep the Exchange Offer open for a period of not less
than the minimum period required under applicable federal and state securities
laws to Consummate the Exchange Offer; provided, however, that in no event shall
such period be less than 20 Business Days. The Company and the Guarantors shall
cause the Exchange Offer to comply with all applicable federal and state
securities laws. No securities other than the Series B Notes shall be included
in the Exchange Offer Registration Statement. The Company and the Guarantors
shall use their respective best efforts to cause the Exchange Offer to be
Consummated on the earliest practicable date after the Exchange Offer
Registration Statement has become effective, but in no event later than 30
business days thereafter (such 30/th/ day being the "Consummation Deadline").
                                                   ---------------------

     (c)  The Company shall include a "Plan of Distribution" section in the
Prospectus contained in the Exchange Offer Registration Statement and indicate
therein that any Broker-Dealer who holds Transfer Restricted Securities that
were acquired for the account of such Broker-Dealer as a result of market-making
activities or other trading activities (other than Series A Notes acquired
directly from the Company or any Affiliate of the Company), may exchange such
Transfer Restricted Securities pursuant to the Exchange Offer. Such "Plan of
Distribution" section shall also contain all other information with respect to
such sales by such Broker-Dealers that the Commission may require in order to
permit such sales pursuant thereto, but such "Plan of Distribution" shall not
name any such Broker-Dealer or disclose the amount of Transfer Restricted
Securities held by any such Broker-Dealer, except to the extent required by the
Commission as a result of a change in policy, rules or regulations after the
date of this Agreement. See the Shearman & Sterling no-action letter (available
July 2, 1993).

                                       3
<PAGE>

     Because such Broker-Dealer may be deemed to be an "underwriter" within the
meaning of the Act and must, therefore, deliver a prospectus meeting the
requirements of the Act in connection with its initial sale of any Series B
Notes received by such Broker-Dealer in the Exchange Offer, the Company and
Guarantors shall permit the use of the Prospectus contained in the Exchange
Offer Registration Statement by such Broker-Dealer to satisfy such prospectus
delivery requirement. To the extent necessary to ensure that the prospectus
contained in the Exchange Offer Registration Statement is available for sales of
Series B Notes by Broker-Dealers, the Company and the Guarantors agree to use
their respective best efforts to keep the Exchange Offer Registration Statement
continuously effective, supplemented, amended and current as required by and
subject to the provisions of Sections 6(a) and (c) hereof and in conformity with
the requirements of this Agreement, the Act and the policies, rules and
regulations of the Commission as announced from time to time, for a period of
one year from the Consummation Deadline or such shorter period as will terminate
when all Transfer Restricted Securities covered by such Registration Statement
have been sold pursuant thereto. The Company and the Guarantors shall provide
sufficient copies of the latest version of such Prospectus to such Broker-
Dealers, promptly upon request, and in no event later than one day after such
request, at any time during such period.


SECTION 4.  SHELF REGISTRATION

     (a)  Shelf Registration. If (i) the Exchange Offer is not permitted by
          ------------------
applicable law (after the Company and the Guarantors have complied with the
procedures set forth in Section 6(a)(i) below) or (ii) if any Holder of Transfer
Restricted Securities shall notify the Company within 20 Business Days following
the Consummation Deadline that (A) such Holder was prohibited by law or
Commission policy from participating in the Exchange Offer or (B) such Holder
may not resell the Series B Notes acquired by it in the Exchange Offer to the
public without delivering a prospectus and the Prospectus contained in the
Exchange Offer Registration Statement is not appropriate or available for such
resales by such Holder or (C) such Holder is a Broker-Dealer and holds Series A
Notes acquired directly from the Company or any of its Affiliates, then the
Company and the Guarantors shall:

   (x) cause to be filed, on or prior to 30 days after the earlier of (i) the
date on which the Company determines that the Exchange Offer Registration
Statement cannot be filed as a result of clause (a)(i) above and (ii) the date
on which the Company receives the notice specified in clause (a)(ii) above,
(such earlier date, the "Filing Deadline"), a shelf registration statement
                         ---------------
pursuant to Rule 415 under the Act (which may be an amendment to the Exchange
Offer Registration Statement (the "Shelf Registration Statement")), relating to
                                   ----------------------------
all Transfer Restricted Securities, and

   (y) shall use their respective reasonable best efforts to cause such Shelf
Registration Statement to become effective on or prior to 90 days after the
Filing Deadline for the Shelf Registration Statement (such 90th day the
"Effectiveness Deadline").
 ----------------------

     If, after the Company has filed an Exchange Offer Registration Statement
that satisfies the requirements of Section 3(a) above, the Company is required
to file and make effective a Shelf Registration Statement solely because the
Exchange Offer is not permitted under applicable federal law (i.e., clause
(a)(i) above), then the filing of the Exchange Offer Registration Statement
shall be deemed to satisfy the requirements of clause (x) above; provided that,
in such event, the Company shall remain obligated to meet the Effectiveness
Deadline set forth in clause (y).

     To the extent necessary to ensure that the Shelf Registration Statement is
available for sales of Transfer Restricted Securities by the Holders thereof
entitled to the benefit of this Section 4(a) and the other securities required
to be registered therein pursuant to Section 6(b)(ii) hereof, the Company and
the Guarantors shall use their respective reasonable best efforts to keep any
Shelf Registration Statement required by this Section 4(a) continuously
effective, supplemented, amended and current as required by and subject to the
provisions of Sections 6(b) and (c) hereof and in conformity with the
requirements of this Agreement, the Act and the policies, rules and

                                       4
<PAGE>

regulations of the Commission as announced from time to time, for a period of at
least two years (as extended pursuant to Section 6(d)) following the Closing
Date, or such shorter period as will terminate when all Transfer Restricted
Securities covered by such Shelf Registration Statement have been sold pursuant
thereto.

     (b)  Provision by Holders of Certain Information in Connection with the
          ------------------------------------------------------------------
Shelf Registration Statement. No Holder of Transfer Restricted Securities may
----------------------------
include any of its Transfer Restricted Securities in any Shelf Registration
Statement pursuant to this Agreement unless and until such Holder furnishes to
the Company in writing, within 20 days after receipt of a request therefor, the
information specified in Item 507 or 508 of Regulation S-K, as applicable, of
the Act for use in connection with any Shelf Registration Statement or
Prospectus or preliminary Prospectus included therein. No Holder of Transfer
Restricted Securities shall be entitled to liquidated damages pursuant to
Section 5 hereof unless and until such Holder shall have provided all such
information. Each selling Holder agrees to promptly furnish additional
information required to be disclosed in order to make the information previously
furnished to the Company by such Holder not materially misleading.


SECTION 5.  LIQUIDATED DAMAGES

     If (i) any Registration Statement required by this Agreement is not filed
with the Commission on or prior to the applicable Filing Deadline, (ii) any such
Registration Statement has not been declared effective by the Commission on or
prior to the applicable Effectiveness Deadline, (iii) the Exchange Offer has not
been Consummated on or prior to the Consummation Deadline or (iv) any
Registration Statement required by this Agreement is filed and declared
effective but shall thereafter cease to be effective or fail to be usable for
its intended purpose without being succeeded immediately by a post-effective
amendment to such Registration Statement that cures such failure and that is
itself declared effective within 5 days of filing such post-effective amendment
to such Registration Statement (each such event referred to in clauses (i)
through (iv), a "Registration Default"), then the Company and the Guarantors
                 --------------------
hereby jointly and severally agree to pay to each Holder of Transfer Restricted
Securities affected thereby liquidated damages in an amount equal to $.05 per
week per $1,000 in principal amount of Transfer Restricted Securities held by
such Holder for each week or portion thereof that the Registration Default
continues for the first 90-day period immediately following the occurrence of
such Registration Default. The amount of the liquidated damages shall increase
by an additional $.05 per week per $1,000 in principal amount of Transfer
Restricted Securities with respect to each subsequent 90-day period until all
Registration Defaults have been cured, up to a maximum amount of liquidated
damages of $.25 per week per $1,000 in principal amount of Transfer Restricted
Securities; provided that the Company and the Guarantors shall in no event be
required to pay liquidated damages for more than one Registration Default at any
given time. Notwithstanding anything to the contrary set forth herein, (1) upon
filing of the Exchange Offer Registration Statement (and/or, if applicable, the
Shelf Registration Statement), in the case of (i) above, (2) upon the
effectiveness of the Exchange Offer Registration Statement (and/or, if
applicable, the Shelf Registration Statement), in the case of (ii) above, (3)
upon Consummation of the Exchange Offer, in the case of (iii) above, or (4) upon
the filing of a post-effective amendment to the Registration Statement or an
additional Registration Statement that causes the Exchange Offer Registration
Statement (and/or, if applicable, the Shelf Registration Statement) to again be
declared effective or made usable in the case of (iv) above, the liquidated
damages payable with respect to the Transfer Restricted Securities as a result
of such clause (i), (ii), (iii) or (iv), as applicable, shall cease.

     All accrued liquidated damages shall be paid to the Holders entitled
thereto, in the manner provided for the payment of interest in the Indenture, on
each Interest Payment Date, as more fully set forth in the Indenture and the
Notes. Notwithstanding the fact that any securities for which liquidated damages
are due cease to be Transfer Restricted Securities, all obligations of the
Company and the Guarantors to pay liquidated damages with respect to securities
shall survive until such time as such obligations with respect to such
securities shall have been satisfied in full.

                                       5
<PAGE>

SECTION 6.  REGISTRATION PROCEDURES

     (a)  Exchange Offer Registration Statement. In connection with the
          -------------------------------------
Exchange Offer, the Company and the Guarantors shall (x) comply with all
applicable provisions of Section 6(c) below, (y) use their respective reasonable
best efforts to effect such exchange and to permit the resale of Series B Notes
by Broker-Dealers that tendered in the Exchange Offer Series A Notes that such
Broker-Dealer acquired for its own account as a result of its market making
activities or other trading activities (other than Series A Notes acquired
directly from the Company or any of its Affiliates) being sold in accordance
with the intended method or methods of distribution thereof, and (z) comply with
all of the following provisions:

          (i)    If, following the date hereof there has been announced a change
   in Commission policy with respect to exchange offers such as the Exchange
   Offer, that in the reasonable opinion of counsel to the Company raises a
   substantial question as to whether the Exchange Offer is permitted by
   applicable federal law, the Company and the Guarantors hereby agree to seek a
   no-action letter or other favorable decision from the Commission allowing the
   Company and the Guarantors to Consummate an Exchange Offer for such Transfer
   Restricted Securities. The Company and the Guarantors hereby agree to pursue
   the issuance of such a decision to the Commission staff level. In connection
   with the foregoing, the Company and the Guarantors hereby agree to take all
   such other actions as may be requested by the Commission or otherwise
   required in connection with the issuance of such decision, including without
   limitation (A) participating in telephonic conferences with the Commission,
   (B) delivering to the Commission staff an analysis prepared by counsel to the
   Company setting forth the legal bases, if any, upon which such counsel has
   concluded that such an Exchange Offer should be permitted and (C) diligently
   pursuing a resolution (which need not be favorable) by the Commission staff.

          (ii)   As a condition to its participation in the Exchange Offer, each
   Holder of Transfer Restricted Securities (including, without limitation, any
   Holder who is a Broker Dealer) shall furnish, upon the request of the
   Company, prior to the Consummation of the Exchange Offer, a written
   representation to the Company and the Guarantors (which may be contained in
   the letter of transmittal contemplated by the Exchange Offer Registration
   Statement) to the effect that (A) it is not an Affiliate of the Company, (B)
   it is not engaged in, and does not intend to engage in, and has no
   arrangement or understanding with any person to participate in, a
   distribution of the Series B Notes to be issued in the Exchange Offer and (C)
   it is acquiring the Series B Notes in its ordinary course of business. As a
   condition to its participation in the Exchange Offer each Holder using the
   Exchange Offer to participate in a distribution of the Series B Notes shall
   acknowledge and agree that, if the resales are of Series B Notes obtained by
   such Holder in exchange for Series A Notes acquired directly from the Company
   or an Affiliate thereof, it (1) could not, under Commission policy as in
   effect on the date of this Agreement, rely on the position of the Commission
   enunciated in Morgan Stanley and Co., Inc. (available June 5, 1991) and Exxon
                 ----------------------------                              -----
   Capital Holdings Corporation (available May 13, 1988), as interpreted in the
   ----------------------------
   Commission's letter to Shearman & Sterling dated July 2, 1993, and similar
                          -------------------
   no-action letters (including, if applicable, any no-action letter obtained
   pursuant to clause (i) above), and (2) must comply with the registration and
   prospectus delivery requirements of the Act in connection with a secondary
   resale transaction and that such a secondary resale transaction must be
   covered by an effective registration statement containing the selling
   security holder information required by Item 507 or 508, as applicable, of
   Regulation S-K.

          (iii)  Prior to effectiveness of the Exchange Offer Registration
   Statement, the Company and the Guarantors shall provide a supplemental letter
   to the Commission (A) stating that the Company and the Guarantors are
   registering the Exchange Offer in reliance on the position of the Commission
   enunciated in Exxon Capital Holdings Corporation (available May 13, 1988),
                 ----------------------------------
   Morgan Stanley and Co., Inc. (available June 5, 1991) as interpreted in the
   ----------------------------
   Commission's letter to Shearman & Sterling dated July 2, 1993, and, if
                          -------------------
   applicable, any no-action letter obtained pursuant to clause (i) above, (B)
   including a representation that neither the Company nor any Guarantor has
   entered into any arrangement or understanding with any Person to

                                       6
<PAGE>

   distribute the Series B Notes to be received in the Exchange Offer and that,
   to the best of the Company's and each Guarantor's information and belief,
   each Holder participating in the Exchange Offer is acquiring the Series B
   Notes in its ordinary course of business and has no arrangement or
   understanding with any Person to participate in the distribution of the
   Series B Notes received in the Exchange Offer and (C) any other undertaking
   or representation required by the Commission as set forth in any no-action
   letter obtained pursuant to clause (i) above, if applicable.

     (b)  Shelf Registration Statement. In connection with the Shelf
          ----------------------------
Registration Statement, the Company and the Guarantors shall:

          (i)  comply with all the provisions of Section 6(c) below and use
their respective reasonable best efforts to effect such registration to permit
the sale of the Transfer Restricted Securities being sold in accordance with the
intended method or methods of distribution thereof (as indicated in the
information furnished to the Company pursuant to Section 4(b) hereof), and
pursuant thereto the Company and the Guarantors will prepare and file with the
Commission a Registration Statement relating to the registration on any
appropriate form under the Act, which form shall be available for the sale of
the Transfer Restricted Securities in accordance with the intended method or
methods of distribution thereof within the time periods and otherwise in
accordance with the provisions hereof.

          (ii)  issue, upon the request of any Holder or purchaser of Series A
Notes covered by any Shelf Registration Statement contemplated by this
Agreement, Series B Notes having an aggregate principal amount equal to the
aggregate principal amount of Series A Notes sold pursuant to the Shelf
Registration Statement and surrendered to the Company for cancellation; the
Company shall register Series B Notes on the Shelf Registration Statement for
this purpose and issue the Series B Notes to the purchaser(s) of securities
subject to the Shelf Registration Statement in the names as such purchaser(s)
shall designate.

     (c)  General Provisions. In connection with any Registration Statement and
          ------------------
any related Prospectus required by this Agreement, the Company and the
Guarantors shall:

          (i)   use their respective reasonable best efforts to keep such
   Registration Statement continuously effective and provide all requisite
   financial statements for the period specified in Section 3 or 4 of this
   Agreement, as applicable. Upon the occurrence of any event that would cause
   any such Registration Statement or the Prospectus contained therein (A) to
   contain an untrue statement of material fact or omit to state any material
   fact necessary to make the statements therein not misleading or (B) not to be
   effective and usable for resale of Transfer Restricted Securities during the
   period required by this Agreement, the Company and the Guarantors shall file
   promptly an appropriate amendment to such Registration Statement curing such
   defect, and, if Commission review is required, use their respective best
   efforts to cause such amendment to be declared effective as soon as
   practicable.

          (ii)  prepare and file with the Commission such amendments and post-
   effective amendments to the applicable Registration Statement as may be
   necessary to keep such Registration Statement effective for the applicable
   period set forth in Section 3 or 4 hereof, as the case may be; cause the
   Prospectus to be supplemented by any required Prospectus supplement, and as
   so supplemented to be filed pursuant to Rule 424 under the Act, and to comply
   fully with Rules 424, 430A and 462, as applicable, under the Act in a timely
   manner; and comply with the provisions of the Act with respect to the
   disposition of all securities covered by such Registration Statement during
   the applicable period in accordance with the intended method or methods of
   distribution by the sellers thereof set forth in such Registration Statement
   or supplement to the Prospectus;

          (iii) advise each Holder promptly and, if requested by such Holder,
   confirm such advice in writing, (A) when the Prospectus or any Prospectus
   supplement or post-effective amendment has been filed, and, with

                                       7
<PAGE>

   respect to any applicable Registration Statement or any post-effective
   amendment thereto, when the same has become effective, (B) of any request by
   the Commission for amendments to the Registration Statement or amendments or
   supplements to the Prospectus or for additional information relating thereto,
   (C) of the issuance by the Commission of any stop order suspending the
   effectiveness of the Registration Statement under the Act or of the
   suspension by any state securities commission of the qualification of the
   Transfer Restricted Securities for offering or sale in any jurisdiction, or
   the initiation of any proceeding for any of the preceding purposes, and (D)
   of the existence of any fact or the happening of any event that makes any
   statement of a material fact made in the Registration Statement, the
   Prospectus, any amendment or supplement thereto or any document incorporated
   by reference therein untrue, or that requires the making of any additions to
   or changes in the Registration Statement in order to make the statements
   therein not misleading, or that requires the making of any additions to or
   changes in the Prospectus in order to make the statements therein, in the
   light of the circumstances under which they were made, not misleading. If at
   any time the Commission shall issue any stop order suspending the
   effectiveness of the Registration Statement, or any state securities
   commission or other regulatory authority shall issue an order suspending the
   qualification or exemption from qualification of the Transfer Restricted
   Securities under state securities or Blue Sky laws, the Company and the
   Guarantors shall use their respective reasonable best efforts to obtain the
   withdrawal or lifting of such order at the earliest possible time;

          (iv)  subject to Section 6(c)(i), if any fact or event contemplated by
   Section 6(c)(iii)(D) above shall exist or have occurred, prepare a supplement
   or post-effective amendment to the Registration Statement or related
   Prospectus or any document incorporated therein by reference or file any
   other required document so that, as thereafter delivered to the purchasers of
   Transfer Restricted Securities, the Prospectus will not contain an untrue
   statement of a material fact or omit to state any material fact necessary to
   make the statements therein, in the light of the circumstances under which
   they were made, not misleading;

          (v)   furnish to each Holder in connection with such exchange or sale,
   if any, before filing with the Commission, copies of any Registration
   Statement or any Prospectus included therein or any amendments or supplements
   to any such Registration Statement or Prospectus (including all documents
   incorporated by reference after the initial filing of such Registration
   Statement), which documents will be subject to the review and comment of such
   Holders in connection with such sale, if any, for a period of at least five
   Business Days, and the Company will not file any such Registration Statement
   or Prospectus or any amendment or supplement to any such Registration
   Statement or Prospectus (including all such documents incorporated by
   reference) to which such Holders shall reasonably object within five Business
   Days after the receipt thereof. A Holder shall be deemed to have reasonably
   objected to such filing if such Registration Statement, amendment, Prospectus
   or supplement, as applicable, as proposed to be filed, contains an untrue
   statement of a material fact or omit to state any material fact necessary to
   make the statements therein not misleading or fails to comply with the
   applicable requirements of the Act;

          (vi)  promptly prior to the filing of any document that is to be
   incorporated by reference into a Registration Statement or Prospectus,
   provide copies of such document to each Holder in connection with such
   exchange or sale, if any, make the Company's and the Guarantors'
   representatives available for discussion of such document and other customary
   due diligence matters, and include such information in such document prior to
   the filing thereof as such Holders may reasonably request;

          (vii) make available, at reasonable times, for inspection by each
   Holder and any attorney or accountant retained by such Holders, all financial
   and other records, pertinent corporate documents of the Company and the
   Guarantors and cause the Company's and the Guarantors' officers, directors
   and employees to supply all information reasonably requested by any such
   Holder, attorney or accountant in connection with such Registration Statement
   or any post-effective amendment thereto subsequent to the filing thereof and
   prior to its effectiveness;

                                       8
<PAGE>

          (viii) if requested by any Holders in connection with such exchange
   or sale, promptly include in any Registration Statement or Prospectus,
   pursuant to a supplement or post-effective amendment if necessary, such
   information as such Holders may reasonably request to have included therein,
   including, without limitation, information relating to the "Plan of
   Distribution" of the Transfer Restricted Securities; and make all required
   filings of such Prospectus supplement or post-effective amendment as soon as
   practicable after the Company is notified of the matters to be included in
   such Prospectus supplement or post-effective amendment;

          (ix)   furnish to each Holder in connection with such exchange or
   sale, without charge, at least one copy of the Registration Statement, as
   first filed with the Commission, and of each amendment thereto, including all
   documents incorporated by reference therein and all exhibits (including
   exhibits incorporated therein by reference);

          (x)    deliver to each Holder without charge, as many copies of the
   Prospectus (including each preliminary prospectus) and any amendment or
   supplement thereto as such Persons reasonably may request; the Company and
   the Guarantors hereby consent to the use (in accordance with law) of the
   Prospectus and any amendment or supplement thereto by each selling Holder in
   connection with the offering and the sale of the Transfer Restricted
   Securities covered by the Prospectus or any amendment or supplement thereto;

          (xi)   upon the request of any Holder, enter into such agreements
   (including underwriting agreements) and make such representations and
   warranties and take all such other actions in connection therewith in order
   to expedite or facilitate the disposition of the Transfer Restricted
   Securities pursuant to any applicable Registration Statement contemplated by
   this Agreement as may be reasonably requested by any Holder in connection
   with any sale or resale pursuant to any applicable Registration Statement. In
   such connection, the Company and the Guarantors shall:

          (A)    upon request of any Holder, furnish (or in the case of
      paragraphs (2) and (3), use its best efforts to cause to be furnished) to
      each Holder, upon Consummation of the Exchange Offer or upon the
      effectiveness of the Shelf Registration Statement, as the case may be:

                 (1) a certificate, dated such date, signed on behalf of the
          Company and each Guarantor by (x) the President or any Vice President
          and (y) a principal financial or accounting officer of the Company and
          such Guarantor, confirming, as of the date thereof, the matters set
          forth in Sections 6(y), 9(a) and 9(b) of the Purchase Agreement and
          such other similar matters as such Holders may reasonably request;

                 (2) an opinion, dated the date of Consummation of the Exchange
          Offer or the date of effectiveness of the Shelf Registration
          Statement, as the case may be, of counsel for the Company and the
          Guarantors covering matters similar to those set forth in paragraph
          (e) of Section 9 of the Purchase Agreement and such other matter as
          such Holder may reasonably request, and in any event including a
          statement to the effect that such counsel has participated in
          conferences with officers and other representatives of the Company and
          the Guarantors, representatives of the independent public accountants
          for the Company and the Guarantors and have considered the matters
          required to be stated therein and the statements contained therein,
          although such counsel has not independently verified the accuracy,
          completeness or fairness of such statements; and that such counsel
          advises that, on the basis of the foregoing (relying as to materiality
          to the extent such counsel deems appropriate upon the statements of
          officers and other representatives of the Company and the Guarantors)
          and without independent check or verification), no facts came to such
          counsel's attention that caused such counsel to believe that the
          applicable Registration Statement, at the time such Registration
          Statement or any post-effective amendment thereto became effective
          and, in the case of the Exchange Offer Registration Statement, as of
          the date of Consummation of the Exchange Offer, contained an untrue
          statement of a material fact or omitted to state a material fact
          required to

                                       9
<PAGE>

          be stated therein or necessary to make the statements therein not
          misleading, or that the Prospectus contained in such Registration
          Statement as of its date and, in the case of the opinion dated the
          date of Consummation of the Exchange Offer, as of the date of
          Consummation, contained an untrue statement of a material fact or
          omitted to state a material fact necessary in order to make the
          statements therein, in the light of the circumstances under which they
          were made, not misleading. Without limiting the foregoing, such
          counsel may state further that such counsel assumes no responsibility
          for, and has not independently verified, the accuracy, completeness or
          fairness of the financial statements, notes and schedules and other
          financial data included in any Registration Statement contemplated by
          this Agreement or the related Prospectus; and

                 (3) a customary comfort letter, dated the date of Consummation
          of the Exchange Offer, or as of the date of effectiveness of the Shelf
          Registration Statement, as the case may be, from the Company's
          independent accountants, in the customary form and covering matters of
          the type customarily covered in comfort letters to underwriters in
          connection with underwritten offerings, and affirming the matters set
          forth in the comfort letters delivered pursuant to Section 9(g) of the
          Purchase Agreement; and

          (B) deliver such other documents and certificates as may be reasonably
     requested by the selling Holders to evidence compliance with the matters
     covered in clause (A) above and with any customary conditions contained in
     any agreement entered into by the Company and the Guarantors pursuant to
     this clause (xi);

          (xii)  prior to any public offering of Transfer Restricted Securities,
   cooperate with the selling Holders and their counsel in connection with the
   registration and qualification of the Transfer Restricted Securities under
   the securities or Blue Sky laws of such jurisdictions as the selling Holders
   may request and do any and all other acts or things necessary or advisable to
   enable the disposition in such jurisdictions of the Transfer Restricted
   Securities covered by the applicable Registration Statement; provided,
   however, that neither the Company nor any Guarantor shall be required to
   register or qualify as a foreign corporation where it is not now so qualified
   or to take any action that would subject it to the service of process in
   suits or to taxation, other than as to matters and transactions relating to
   the Registration Statement, in any jurisdiction where it is not now so
   subject;

          (xiii) in connection with any sale of Transfer Restricted Securities
   that will result in such securities no longer being Transfer Restricted
   Securities, cooperate with the Holders to facilitate the timely preparation
   and delivery of certificates representing Transfer Restricted Securities to
   be sold and not bearing any restrictive legends; and to register such
   Transfer Restricted Securities in such denominations and such names as the
   selling Holders may request at least two Business Days prior to such sale of
   Transfer Restricted Securities;

          (xiv)  use their respective reasonable best efforts to cause the
   disposition of the Transfer Restricted Securities covered by the Registration
   Statement to be registered with or approved by such other governmental
   agencies or authorities as may be necessary to enable the seller or sellers
   thereof to consummate the disposition of such Transfer Restricted Securities,
   subject to the proviso contained in clause (xii) above;

          (xv)   provide a CUSIP number for all Transfer Restricted Securities
   not later than the effective date of a Registration Statement covering such
   Transfer Restricted Securities and provide the Trustee under the Indenture
   with printed certificates for the Transfer Restricted Securities which are in
   a form eligible for deposit with the Depository Trust Company;

          (xvi)  otherwise use their respective reasonable best efforts to
   comply with all applicable rules and regulations of the Commission, and make
   generally available to its security holders with regard to any

                                      10
<PAGE>

   applicable Registration Statement, as soon as practicable, a consolidated
   earnings statement meeting the requirements of Rule 158 (which need not be
   audited) covering a twelve-month period beginning after the effective date of
   the Registration Statement (as such term is defined in paragraph (c) of Rule
   158 under the Act);

          (xvii)  cause the Indenture to be qualified under the TIA not later
   than the effective date of the first Registration Statement required by this
   Agreement and, in connection therewith, cooperate with the Trustee and the
   Holders to effect such changes to the Indenture as may be required for such
   Indenture to be so qualified in accordance with the terms of the TIA; and
   execute and use its best efforts to cause the Trustee to execute, all
   documents that may be required to effect such changes and all other forms and
   documents required to be filed with the Commission to enable such Indenture
   to be so qualified in a timely manner; and

          (xviii) provide promptly to each Holder, upon request, each document
   filed with the Commission pursuant to the requirements of Section 13 or
   Section 15(d) of the Exchange Act.

     (d)  Restrictions on Holders. Each Holder agrees by acquisition of a
          -----------------------
Transfer Restricted Security that, upon receipt of the notice referred to in
Section 6(c)(iii)(C) or any notice from the Company of the existence of any fact
of the kind described in Section 6(c)(iii)(D) hereof (in each case, a
"Suspension Notice"), such Holder will forthwith discontinue disposition of
 -----------------
Transfer Restricted Securities pursuant to the applicable Registration Statement
until (i) such Holder has received copies of the supplemented or amended
Prospectus contemplated by Section 6(c)(iv) hereof, or (ii) such Holder is
advised in writing by the Company that the use of the Prospectus may be resumed,
and has received copies of any additional or supplemental filings that are
incorporated by reference in the Prospectus (in each case, the "Recommencement
                                                                --------------
Date"). Each Holder receiving a Suspension Notice hereby agrees that it will
----
either (i) destroy any Prospectuses, other than permanent file copies, then in
such Holder's possession which have been replaced by the Company with more
recently dated Prospectuses or (ii) deliver to the Company (at the Company's
expense) all copies, other than permanent file copies, then in such Holder's
possession of the Prospectus covering such Transfer Restricted Securities that
was current at the time of receipt of the Suspension Notice. The time period
regarding the effectiveness of such Registration Statement set forth in Section
3 or 4 hereof, as applicable, shall be extended by a number of days equal to the
number of days in the period from and including the date of delivery of the
Suspension Notice to the date of delivery of the Recommencement Date.


SECTION 7.  REGISTRATION EXPENSES

     (a)  All expenses incident to the Company's and the Guarantors' performance
of or compliance with this Agreement will be borne by the Company, regardless of
whether a Registration Statement becomes effective, including without
limitation: (i) all registration and filing fees and expenses; (ii) all fees and
expenses of compliance with federal securities and state Blue Sky or securities
laws; (iii) all expenses of printing (including printing certificates for the
Series B Notes to be issued in the Exchange Offer and printing of Prospectuses),
messenger and delivery services and telephone; (iv) all fees and disbursements
of counsel for the Company, the Guarantors and the Holders of Transfer
Restricted Securities; (v) all application and filing fees in connection with
listing the Series B Notes on a national securities exchange or automated
quotation system pursuant to the requirements hereof; and (vi) all fees and
disbursements of independent certified public accountants of the Company and the
Guarantors (including the expenses of any special audit and comfort letters
required by or incident to such performance).

     The Company will, in any event, bear its and the Guarantors' internal
expenses (including, without limitation, all salaries and expenses of its
officers and employees performing legal or accounting duties), the expenses of
any annual audit and the fees and expenses of any Person, including special
experts, retained by the Company or the Guarantors.

                                      11
<PAGE>

     (b)  In connection with any Registration Statement required by this
Agreement (including, without limitation, the Exchange Offer Registration
Statement and the Shelf Registration Statement), the Company and the Guarantors
will reimburse the Initial Purchasers and the Holders of Transfer Restricted
Securities who are tendering Series A Notes in the Exchange Offer and/or selling
or reselling Series A Notes or Series B Notes pursuant to the "Plan of
Distribution" contained in the Exchange Offer Registration Statement or the
Shelf Registration Statement, as applicable, for the reasonable fees and
disbursements of not more than one counsel, who shall be Davis Polk & Wardwell,
unless another firm shall be chosen by the Holders of a majority in principal
amount of the Transfer Restricted Securities for whose benefit such Registration
Statement is being prepared. Notwithstanding the foregoing, such Holders shall
be responsible for any and all underwriting discounts and commissions and prior
to employing counsel in connection with an Exchange Offer, the Initial
Purchasers will notify the Company and the Company's counsel and provide them
reasonable opportunity to discuss the need for separate counsel; provided,
however, the Initial Purchasers shall at all times retain the sole right to
employ separate counsel.


SECTION 8.  INDEMNIFICATION

     (a)  The Company and the Guarantors agrees, jointly and severally, to
indemnify and hold harmless each Holder, its directors, officers and each
Person, if any, who controls such Holder (within the meaning of Section 15 of
the Act or Section 20 of the Exchange Act), from and against any and all losses,
claims, damages, liabilities, judgments, (including without limitation, any
legal or other expenses incurred in connection with investigating or defending
any matter, including any action that could give rise to any such losses,
claims, damages, liabilities or judgments) caused by any untrue statement or
alleged untrue statement of a material fact contained in any Registration
Statement, preliminary prospectus or Prospectus (or any amendment or supplement
thereto) provided by the Company to any Holder or any prospective purchaser of
Series B Notes or registered Series A Notes, or caused by any omission or
alleged omission to state therein a material fact required to be stated therein
or necessary to make the statements therein not misleading, except insofar as
such losses, claims, damages, liabilities or judgments are caused by an untrue
statement or omission or alleged untrue statement or omission that is based upon
information relating to any of the Holders furnished in writing to the Company
by any of the Holders.

     (b)  Each Holder of Transfer Restricted Securities agrees, severally and
not jointly, to indemnify and hold harmless the Company and the Guarantors, and
their respective directors and officers, and each person, if any, who controls
(within the meaning of Section 15 of the Act or Section 20 of the Exchange Act)
the Company, or the Guarantors to the same extent as the foregoing indemnity
from the Company and the Guarantors set forth in Section 8(a) above, but only
with reference to information relating to such Holder furnished in writing to
the Company by such Holder expressly for use in any Registration Statement. In
no event shall any Holder, its directors, officers or any Person who controls
such Holder be liable or responsible for any amount in excess of the amount by
which the total amount received by such Holder with respect to its sale of
Transfer Restricted Securities pursuant to a Registration Statement exceeds (i)
the amount paid by such Holder for such Transfer Restricted Securities and (ii)
the amount of any damages that such Holder, its directors, officers or any
Person who controls such Holder has otherwise been required to pay by reason of
such untrue or alleged untrue statement or omission or alleged omission.

     (c)  In case any action shall be commenced involving any person in respect
of which indemnity may be sought pursuant to Section 8(a) or 8(b) (the
"indemnified party"), the indemnified party shall promptly notify the person
 -----------------
against whom such indemnity may be sought (the "indemnifying person") in writing
                                                -------------------
and the indemnifying party shall assume the defense of such action, including
the employment of counsel reasonably satisfactory to the indemnified party and
the payment of all fees and expenses of such counsel, as incurred (except that
in the case of any action in respect of which indemnity may be sought pursuant
to both Sections 8(a) and 8(b), a Holder shall not be required to assume the
defense of such action pursuant to this Section 8(c), but may employ separate
counsel and participate in the defense thereof, but the fees and expenses of
such counsel, except as provided below, shall be

                                      12
<PAGE>

at the expense of the Holder). Any indemnified party shall have the right to
employ separate counsel in any such action and participate in the defense
thereof, but the fees and expenses of such counsel shall be at the expense of
the indemnified party unless (i) the employment of such counsel shall have been
specifically authorized in writing by the indemnifying party, (ii) the
indemnifying party shall have failed to assume the defense of such action or
employ counsel reasonably satisfactory to the indemnified party or (iii) the
named parties to any such action (including any impleaded parties) include both
the indemnified party and the indemnifying party, and the indemnified party
shall have been advised by such counsel that there may be one or more legal
defenses available to it which are different from or additional to those
available to the indemnifying party (in which case the indemnifying party shall
not have the right to assume the defense of such action on behalf of the
indemnified party). In any such case, the indemnifying party shall not, in
connection with any one action or separate but substantially similar or related
actions in the same jurisdiction arising out of the same general allegations or
circumstances, be liable for the fees and expenses of more than one separate
firm of attorneys (in addition to any local counsel) for all indemnified parties
and all such fees and expenses shall be reimbursed as they are incurred. Such
firm shall be designated in writing by a majority of the Holders, in the case of
the parties indemnified pursuant to Section 8(a), and by the Company and
Guarantors, in the case of parties indemnified pursuant to Section 8(b). The
indemnifying party shall indemnify and hold harmless the indemnified party from
and against any and all losses, claims, damages, liabilities and judgments by
reason of any settlement of any action (i) effected with its written consent or
(ii) effected without its written consent if the settlement is entered into more
than twenty business days after the indemnifying party shall have received a
request from the indemnified party for reimbursement for the fees and expenses
of counsel (in any case where such fees and expenses are at the expense of the
indemnifying party) and, prior to the date of such settlement, the indemnifying
party shall have failed to comply with such reimbursement request. No
indemnifying party shall, without the prior written consent of the indemnified
party, effect any settlement or compromise of, or consent to the entry of
judgment with respect to, any pending or threatened action in respect of which
the indemnified party is or could have been a party and indemnity or
contribution may be or could have been sought hereunder by the indemnified
party, unless such settlement, compromise or judgment (i) includes an
unconditional release of the indemnified party from all liability on claims that
are or could have been the subject matter of such action and (ii) does not
include a statement as to or an admission of fault, culpability or a failure to
act, by or on behalf of the indemnified party.

     (d) To the extent that the indemnification provided for in this Section 8
is unavailable to an indemnified party in respect of any losses, claims,
damages, liabilities or judgments referred to therein, then each indemnifying
party, in lieu of indemnifying such indemnified party, shall contribute to the
amount paid or payable by such indemnified party as a result of such losses,
claims, damages, liabilities or judgments (i) in such proportion as is
appropriate to reflect the relative benefits received by the Company and the
Guarantors, on the one hand, and the Holders, on the other hand, from their sale
of Transfer Restricted Securities or (ii) if the allocation provided by clause
8(d)(i) is not permitted by applicable law, in such proportion as is appropriate
to reflect not only the relative benefits referred to in clause 8(d)(i) above
but also the relative fault of the Company and the Guarantors, on the one hand,
and of the Holder, on the other hand, in connection with the statements or
omissions which resulted in such losses, claims, damages, liabilities or
judgments, as well as any other relevant equitable considerations. The relative
fault of the Company and the Guarantors, on the one hand, and of the Holder, on
the other hand, shall be determined by reference to, among other things, whether
the untrue or alleged untrue statement of a material fact or the omission or
alleged omission to state a material fact relates to information supplied by the
Company or such Guarantor, on the one hand, or by the Holder, on the other hand,
and the parties' relative intent, knowledge, access to information and
opportunity to correct or prevent such statement or omission.

     The Company, the Guarantors and each Holder agree that it would not be just
and equitable if contribution pursuant to this Section 8(d) were determined by
pro rata allocation (even if the Holders were treated as one entity for such
purpose) or by any other method of allocation which does not take account of the
equitable considerations referred to in the immediately preceding paragraph. The
amount paid or payable by an indemnified party as a result of the losses,
claims, damages, liabilities or judgments referred to in the immediately
preceding paragraph shall be deemed to include, subject to the limitations set
forth above, any legal or other expenses

                                      13
<PAGE>

incurred by such indemnified party in connection with investigating or defending
any matter, including any action that could have given rise to such losses,
claims, damages, liabilities or judgments. Notwithstanding the provisions of
this Section 8, no Holder, its directors, its officers or any Person, if any,
who controls such Holder shall be required to contribute, in the aggregate, any
amount in excess of the amount by which the total received by such Holder with
respect to the sale of Transfer Restricted Securities pursuant to a Registration
Statement exceeds (i) the amount paid by such Holder for such Transfer
Restricted Securities and (ii) the amount of any damages which such Holder has
otherwise been required to pay by reason of such untrue or alleged untrue
statement or omission or alleged omission. No person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Act) shall be
entitled to contribution from any person who was not guilty of such fraudulent
misrepresentation. The Holders' obligations to contribute pursuant to this
Section 8(d) are several in proportion to the respective principal amount of
Transfer Restricted Securities held by each Holder hereunder and not joint.


SECTION 9.     RULE 144A and RULE 144

     The Company and each Guarantor agree with each Holder, for so long as any
Transfer Restricted Securities remain outstanding and during any period in which
the Company or such Guarantor (i) is not subject to Section 13 or 15(d) of the
Exchange Act, to make available, upon request of any Holder, to such Holder or
beneficial owner of Transfer Restricted Securities in connection with any sale
thereof and any prospective purchaser of such Transfer Restricted Securities
designated by such Holder or beneficial owner, the information required by Rule
144A(d)(4) under the Act in order to permit resales of such Transfer Restricted
Securities pursuant to Rule 144A, and (ii) is subject to Section 13 or 15 (d) of
the Exchange Act, to make all filings required thereby in a timely manner in
order to permit resales of such Transfer Restricted Securities pursuant to Rule
144.

SECTION 10.    MISCELLANEOUS

     (a) Remedies.  The Company and the Guarantors acknowledge and agree that
         --------
any failure by the Company and/or the Guarantors to comply with their respective
obligations under Sections 3 and 4 hereof may result in material irreparable
injury to the Initial Purchasers or the Holders for which there is no adequate
remedy at law, that it will not be possible to measure damages for such injuries
precisely and that, in the event of any such failure, the Initial Purchasers or
any Holder may obtain such relief as may be required to specifically enforce the
Company's and the Guarantor's obligations under Sections 3 and 4 hereof. The
Company and the Guarantors further agree to waive the defense in any action for
specific performance that a remedy at law would be adequate.

     (b) No Inconsistent Agreements.  Neither the Company nor any Guarantor
         --------------------------
will, on or after the date of this Agreement, enter into any agreement with
respect to its securities that is inconsistent with the rights granted to the
Holders in this Agreement or otherwise conflicts with the provisions hereof.
Neither the Company nor any Guarantor has previously entered into any agreement
granting any registration rights with respect to its securities to any Person.
The rights granted to the Holders hereunder do not in any way conflict with and
are not inconsistent with the rights granted to the holders of the Company's and
the Guarantors' securities under any agreement in effect on the date hereof.

     (c) Amendments and Waivers.  The provisions of this Agreement may not be
         ----------------------
amended, modified or supplemented, and waivers or consents to or departures from
the provisions hereof may not be given unless (i) in the case of Section 5
hereof and this Section 10(c)(i), the Company has obtained the written consent
of Holders of all outstanding Transfer Restricted Securities and (ii) in the
case of all other provisions hereof, the Company has obtained the written
consent of Holders of a majority of the outstanding principal amount of Transfer
Restricted Securities (excluding Transfer Restricted Securities held by the
Company or its Affiliates). Notwithstanding the foregoing, a waiver or consent
to departure from the provisions hereof that relates exclusively to the rights
of Holders whose Transfer Restricted Securities are being tendered pursuant to
the Exchange Offer, and that does not affect directly or indirectly the rights
of other Holders whose Transfer Restricted Securities are not being tendered

                                      14
<PAGE>

pursuant to such Exchange Offer, may be given by the Holders of a majority of
the outstanding principal amount of Transfer Restricted Securities subject to
such Exchange Offer.

     (d) Third Party Beneficiary.  The Holders shall be third party
         -----------------------
beneficiaries to the agreements made hereunder between the Company and the
Guarantors, on the one hand, and the Initial Purchasers, on the other hand, and
shall have the right to enforce such agreements directly to the extent they may
deem such enforcement necessary or advisable to protect its rights or the rights
of Holders hereunder.

     (e) Notices.  All notices and other communications provided for or
         -------
permitted hereunder shall be made in writing by hand-delivery, first-class mail
(registered or certified, return receipt requested), telex, telecopier, or air
courier guaranteeing overnight delivery:

          (i)  if to a Holder, at the address set forth on the records of the
   Registrar under the Indenture, with a copy to the Registrar under the
   Indenture; and

          (ii) if to the Company or the Guarantors:
               c/o Hovnanian Enterprises, Inc.
               10 Highway 35
               P.O. Box 500
               Red Bank, NJ 07701

               Telecopier No.: 732-747-7159
               Attention: Corporate Controller

               With a copy to:
               Simpson Thacher & Bartlett
               425 Lexington Ave.
               New York, NY 10017

               Telecopier No.: 212-455-2502
               Attention: Vince Pagano, Esq.

     All such notices and communications shall be deemed to have been duly
given: at the time delivered by hand, if personally delivered; five Business
Days after being deposited in the mail, postage prepaid, if mailed; when receipt
acknowledged, if telecopied; and on the next business day, if timely delivered
to an air courier guaranteeing overnight delivery.

     Copies of all such notices, demands or other communications shall be
concurrently delivered by the Person giving the same to the Trustee at the
address specified in the Indenture.

     (f) Successors and Assigns.  This Agreement shall inure to the benefit of
         ----------------------
and be binding upon the successors and assigns of each of the parties, including
without limitation and without the need for an express assignment, subsequent
Holders; provided, that nothing herein shall be deemed to permit any assignment,
transfer or other disposition of Transfer Restricted Securities in violation of
the terms hereof or of the Purchase Agreement or the Indenture. If any
transferee of any Holder shall acquire Transfer Restricted Securities in any
manner, whether by operation of law or otherwise, such Transfer Restricted
Securities shall be held subject to all of the terms of this Agreement, and by
taking and holding such Transfer Restricted Securities such Person shall be
conclusively deemed to have agreed to be bound by and to perform all of the
terms and provisions of this Agreement, including the restrictions on resale set
forth in this Agreement and, if applicable, the Purchase Agreement, and such
Person shall be entitled to receive the benefits hereof.

                                      15
<PAGE>

      (g) Counterparts.  This Agreement may be executed in any number of
          ------------
counterparts and by the parties hereto in separate counterparts, each of which
when so executed shall be deemed to be an original and all of which taken
together shall constitute one and the same agreement.

      (h) Headings.  The headings in this Agreement are for convenience of
          --------
reference only and shall not limit or otherwise affect the meaning hereof.

      (i) Governing Law.  THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN
          -------------
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD TO THE
CONFLICT OF LAW RULES THEREOF.

      (j) Severability.  In the event that any one or more of the provisions
          ------------
contained herein, or the application thereof in any circumstance, is held
invalid, illegal or unenforceable, the validity, legality and enforceability of
any such provision in every other respect and of the remaining provisions
contained herein shall not be affected or impaired thereby.

      (k) Entire Agreement.  This Agreement is intended by the parties as a
          ----------------
final expression of their agreement and intended to be a complete and exclusive
statement of the agreement and understanding of the parties hereto in respect of
the subject matter contained herein. There are no restrictions, promises,
warranties or undertakings, other than those set forth or referred to herein
with respect to the registration rights granted with respect to the Transfer
Restricted Securities. This Agreement supersedes all prior agreements and
understandings between the parties with respect to such subject matter.

                                      16
<PAGE>

      IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date first written above.

                              K. HOVNANIAN ENTERPRISES, INC.

                              By: _______________________________
                                  Name:
                                  Title:

                              HOVNANIAN ENTERPRISES, INC.


                              By: ________________________________
                                  Name:
                                  Title:


                              GUARANTORS:


                              HOVNANIAN ENTERPRISES, INC.
                              K. HOVNANIAN AT HOPEWELL ILL, INC.
                              RECREATIONAL DEVELOPMENT CORP., INC.
                              PINE BROOK COMPANY, INC.
                              K. HOVNANIAN AT BEDMINSTER, INC.
                              K. HOVNANIAN AT THE BLUFF, INC.
                              K. HOVNANIAN AT ATLANTIC CITY, INC.
                              HOVNANIAN PROPERTIES OF ATLANTIC COUNTY, INC.
                              MONTEGO BAY I ACQUISITION CORP., INC.
                              PIKE UTILITIES, INC.
                              ARROW PROPERTIES, INC.
                              K. HOVNANIAN REAL ESTATE INVESTMENT, INC.
                              HOVNANIAN TEXAS, INC.
                              LANDARAMA, INC.
                              TROPICAL SERVICE BUILDERS, INC.
                              HOVNANIAN PENNSYLVANIA, INC.
                              K. HOVNANIAN PROPERTIES OF NORTH BRUNSWICK V, INC.
                              K. HOVNANIAN DEVELOPMENTS OF TEXAS, INC.
                              THE MATZEL & MUMFORD ORGANIZATION, INC.
                              M & M INVESTMENTS, L.P.
                              MATZEL & MUMFORD OF DELAWARE, INC.
                              PARK VILLAGE REALTY, INC.
                              GOODMAN FAMILY OF BUILDERS, L.P.
                              REFLECTIONS OF YOU INTERIORS, INC.
                              HEXTER FAIR LAND TITLE COMPANY I, INC.
                              K. HOVNANIAN AT MAHWAH VIII, INC.
                              K. HOVNANIAN AT WALL TOWNSHIP IV, INC.
                              K. HOVNANIAN AT MONTVILLE, INC.
                              HOVNANIAN OF PALM BEACH, INC.

                                      17
<PAGE>

                              K. HOVNANIAN COMPANIES OF FLORIDA, INC.
                              K. HOVNANIAN AT FREEHOLD TOWNSHIP, INC.
                              HOVNANIAN PROPERTIES OF LAKE WORTH, INC.
                              K. HOVNANIAN COMPANIES OF
                              PENNSYLVANIA, INC.
                              K. HOVNANIAN PROPERTIES OF HAMILTON, INC.
                              K. HOVNANIAN AT SCOTCH PLAINS, INC.
                              K. HOVNANIAN AT WAYNE IV, INC.
                              HOVNANIAN DEVELOPMENTS OF FLORIDA, INC.
                              MONTEGO BAY II ACQUISITION CORP., INC.
                              HOVNANIAN OF PALM BEACH VII, INC.
                              K. HOVNANIAN AT WALL TOWNSHIP II, INC.
                              K. HOVNANIAN ENTERPRISES, INC.
                              HOVNANIAN OF PALM BEACH IX, INC.
                              HOVNANIAN AT TARPON LAKES I, INC.
                              K. HOVNANIAN COMPANIES NORTHEAST, INC.
                              KINGS GRANT EVESHAM CORP.
                              K. HOVNANIAN AT MANALAPAN, INC.
                              K. HOVNANIAN AT WALL TOWNSHIP, INC.
                              K. HOVNANIAN AT EAST BRUNSWICK VII, INC.
                              K. HOVNANIAN COMPANIES OF CENTRAL JERSEY, INC.
                              HOVNANIAN OF PALM BEACH XI, INC.
                              K. HOVNANIAN AT SOUTH BRUNSWICK II, INC.
                              K. HOVNANIAN AT LAWRENCE SQUARE, INC.
                              K. HOVNANIAN AT TARPON LAKES III, INC.
                              K. HOVNANIAN AT HORIZON HEIGHTS, INC.
                              K. HOVNANIAN AT RESERVOIR RIDGE, INC.
                              K. HOVNANIAN AT JERSEY CITY I, INC.
                              K. HOVNANIAN INVESTMENT PROPERTIES OF NEW JERSEY,
                              INC.
                              K. HOVNANIAN AT FT. MYERS I, INC.
                              K. HOVNANIAN AT HOWELL TOWNSHIP II, INC.
                              K. HOVNANIAN AT KLOCKNER FARMS, INC.
                              K. HOVNANIAN AT JENSEN BEACH, INC.
                              MOLLY PITCHER CONSTRUCTION CO., INC.
                              K. HOVNANIAN AT MAHWAH VII, INC.
                              K. HOVNANIAN AT WAYNE III, INC.
                              K. HOVNANIAN PROPERTIES OF EAST BRUNSWICK II, INC.
                              K. HOVNANIAN AT KINGS GRANT I, INC.
                              THE NEW FORTIS CORPORATION
                              K. HOVNANIAN AT CLARKSTOWN, INC.
                              K. HOVNANIAN COMPANIES OF NEW YORK, INC.
                              K. HOVNANIAN DEVELOPMENTS OF NEW YORK, INC.
                              DRYER ASSOCIATES, INC.
                              K. HOVNANIAN AT PASCO I, INC.
                              K. HOVNANIAN AT LAKEWOOD, INC.
                              K. HOVNANIAN AT MARTIN DOWNS II, INC.
                              K. HOVNANIAN AVIATION, INC.

                                      18
<PAGE>

                              K. HOVNANIAN INVESTMENT PROPERTIES, INC.
                              K. HOVNANIAN AT FT. MYERS II, INC.
                              K. HOVNANIAN AT BERNARDS II, INC.
                              K. HOVNANIAN AT SOUTH BRUNSWICK III, INC.
                              MINERVA GROUP, INC.
                              K. HOVNANIAN DEVELOPMENTS OF NEW JERSEY, INC.
                              K. HOVNANIAN AT BRIDGEWATER V, INC.
                              K. HOVNANIAN AT NORTH BRUNSWICK II, INC.
                              K. HOVNANIAN AT WASHINGTONVILLE, INC.
                              K. HOVNANIAN AT PEEKSKILL, INC.
                              K. HOVNANIAN AT NEWARK I, INC.
                              K. HOVNANIAN AT CARMEL, INC.
                              K. HOVNANIAN AT EAST WINDSOR I, INC.
                              PARTHENON GROUP, INC.
                              K. HOVNANIAN AT MARLBORO TOWNSHIP II, INC.
                              K. HOVNANIAN AT SOMERSET III, INC.
                              R.C.K. COMMUNITY MANAGEMENT CO., INC.
                              K. HOVNANIAN AT MONTCLAIR, NJ, INC.
                              K. HOVNANIAN AT EAST BRUNSWICK VI, INC.
                              K. HOVNANIAN AT HACKETTSTOWN, INC.
                              K. HOVNANIAN COMPANIES OF NORTH CAROLINA, INC.
                              K. HOVNANIAN AT MONTVILLE II, INC.
                              K. HOVNANIAN AT WALL TOWNSHIP VII, INC.
                              K. HOVNANIAN AT BRIDGEWATER II, INC.
                              K. HOVNANIAN AT MERRIMACK, INC.
                              K. HOVNANIAN AT BERNARDS III, INC.
                              K. HOVNANIAN AT WAYNE V, INC.
                              K. HOVNANIAN AT PASCO II, INC.
                              K. HOVNANIAN AT DELRAY BEACH II, INC.
                              K. HOVNANIAN AT BRANCHBURG I, INC.
                              K. HOVNANIAN AT PLAINSBORO II, INC.
                              K. HOVNANIAN AT NORTHERN WESTCHESTER, INC.
                              K. HOVNANIAN AT MARLBORO TOWNSHIP, INC.
                              K. HOVNANIAN AT WEST ORANGE, INC.
                              EASTERN TITLE AGENCY, INC.
                              K. HOVNANIAN PROPERTIES OF FRANKLIN, INC.
                              K. HOVNANIAN AT MAHWAH II, INC.
                              NEW ENGLAND COMMUNITY MANAGEMENT COMPANY, INC.
                              K. HOVNANIAN AT HOWELL TOWNSHIP, INC.
                              K. HOVNANIAN AT SOUTH BRUNSWICK IV, INC.
                              K. HOVNANIAN AT WALL TOWNSHIP VI, INC.
                              K. HOVNANIAN PROPERTIES OF PISCATAWAY, INC.
                              K. HOVNANIAN AT MAHWAH V, INC.
                              K. HOVNANIAN AT MERRIMACK II, INC.
                              K. HOVNANIAN AT NEWARK URBAN RENEWAL CORPORATION I
                              K. HOVNANIAN AT LAWRENCE GROVE, INC.

                                      19
<PAGE>

                              K. HOVNANIAN AT CEDAR GROVE I, INC.
                              K. HOVNANIAN AT CEDAR GROVE II, INC.
                              K. HOVNANIAN AT NORTH BRUNSWICK III, INC.
                              K. HOVNANIAN AT JERSEY CITY II, INC.
                              K. HOVNANIAN AT BURLINGTON, INC.
                              K. HOVNANIAN AT SOUTH BRUNSWICK V, INC.
                              K. HOVNANIAN AT HALF MOON BAY, INC.
                              K. HOVNANIAN AT JACKSONVILLE II, INC.
                              K. HOVNANIAN AT BRANCHBURG II, INC.
                              K. HOVNANIAN AT EMBASSY LAKES, INC.
                              K. HOVNANIAN AT THE RESERVE AT MEDFORD, INC.
                              K. HOVNANIAN AT BRANCHBURG III, INC.
                              K. HOVNANIAN AT LOWER SAUCON, INC.
                              JERSEY CITY DANFORTH CSO, INC.
                              K. HOVNANIAN AT EAST WINDSOR II, INC.
                              K. HOVNANIAN AT MARLBORO TOWNSHIP III, INC.
                              K. HOVNANIAN AT NEWARK URBAN RENEWAL CORP. III,
                              INC.
                              K. HOVNANIAN AT SOMERSET VIII, INC.
                              K. HOVNANIAN AT READINGTON, INC.
                              K. HOVNANIAN AT HOPEWELL I, INC.
                              K. HOVNANIAN AT NEWARK URBAN RENEWAL CORP. IV,
                              INC.
                              K. HOVNANIAN AT NEWARK URBAN RENEWAL CORP. V, INC.
                              K. HOVNANIAN AT PLAINSBORO III, INC.
                              K. HOVNANIAN AT MAHWAH IV, INC.
                              K. HOVNANIAN AT POMPANO BEACH, INC.
                              K. HOVNANIAN AT JERSEY CITY III, INC.
                              K. HOVNANIAN PROPERTIES OF NEWARK URBAN RENEWAL
                              CORPORATION, INC.
                              K. HOVNANIAN AT NORTH BRUNSWICK IV, INC.
                              K. HOVNANIAN AT BRIDGEWATER IV, INC.
                              K. HOVNANIAN AT SOUTH BRUNSWICK, INC.
                              K. HOVNANIAN AT PERKIOMEN I, INC.
                              K. HOVNANIAN AT VALLEYBROOK, INC.
                              K. HOVNANIAN AT OCEAN TOWNSHIP, INC.
                              K. HOVNANIAN AT PLAINSBORO I, INC.
                              K. HOVNANIAN REAL ESTATE OF FLORIDA, INC.
                              WESTERN FINANCIAL SERVICES, INC.
                              K. HOVNANIAN AT WAYNE, INC.
                              K. HOVNANIAN PROPERTIES OF RED BANK, INC.
                              K. HOVNANIAN AT HANOVER, INC.
                              K. HOVNANIAN AT LAKE CHARLESTON, INC.
                              NEW K. HOVNANIAN DEVELOPMENTS OF FLORIDA, INC.
                              K. HOVNANIAN COMPANIES OF METRO WASHINGTON, INC.
                              K. HOVNANIAN AT MONTGOMERY I, INC. EXC, INC.
                              K. HOVNANIAN DEVELOPMENTS OF METRO

                                      20
<PAGE>

                              WASHINGTON, INC.
                              K. HOVNANIAN AT ASHBURN VILLAGE, INC.
                              K. HOVNANIAN AT WOODMONT, INC.
                              K. HOVNANIAN AT FAIRWAY VIEWS, INC.
                              K. HOVNANIAN AT CAROLINA COUNTRY CLUB I, INC.
                              K. HOVNANIAN AT CHAPEL TRAIL, INC.
                              K. HOVNANIAN TREASURE COAST, INC.
                              K. HOVNANIAN AT UPPER MERION, INC.
                              K. HOVNANIAN AT MAHWAH VI, INC.
                              K. HOVNANIAN AT MEDFORD I, INC.
                              K. HOV INTERNATIONAL, INC.
                              K. HOVNANIAN AT MONTCLAIR, INC.
                              K. HOVNANIAN AT BULL RUN, INC.
                              K. HOVNANIAN AT SULLY STATION, INC.
                              K. HOVNANIAN AT SPRING RIDGE, INC.
                              K. HOVNANIAN MARINE, INC.
                              K. HOVNANIAN AT RIVER OAKS, INC.
                              K. HOVNANIAN AT HOLLY CREST, INC.
                              K. HOVNANIAN PROPERTIES OF ROUTE 35, INC.
                              STONEBROOK HOMES, INC.
                              K. HOVNANIAN AT WINSTON TRAILS, INC.
                              K. HOVNANIAN AT LAKES OF BOCA RATON, INC.
                              K. HOVNANIAN AT LAKE CHARLESTON II, INC.
                              K. HOVNANIAN AT LAKE CHARLESTON III, INC.
                              K. HOVNANIAN AT BRIDGEWATER VI, INC.
                              KHIPE, INC.
                              K. HOVNANIAN AT FAIR LAKES, INC.
                              K. HOVNANIAN AT CAROLINA COUNTRY
                              CLUB II, INC.
                              K. HOVNANIAN AT VALLEYBROOK II, INC.
                              K. HOVNANIAN AT PARK RIDGE, INC.
                              K. HOVNANIAN AT BELMONT, INC.
                              K. HOVNANIAN AT WINSTON TRAILS II, INC.
                              K. HOVNANIAN FAIR LAKES GLEN, INC.
                              K. HOVNANIAN AT PEMBROKE SHORES, INC.
                              K. HOVNANIAN AT CAROLINA COUNTRY
                              CLUB III, INC.
                              GOVERNOR'S ABSTRACT CO., INC.
                              K. HOVNANIAN AT COCONUT CREEK, INC.
                              K. HOVNANIAN AT POLO TRACE, INC.
                              FOUNDERS TITLE AGENCY, INC.
                              K. HOVNANIAN AT BERNARDS IV, INC.
                              K. HOVNANIAN AT PERKIOMEN II, INC.
                              K. HOVNANIAN AT WAYNE II, INC.
                              K. HOVNANIAN AT UPPER MAKEFIELD I, INC.
                              K. HOVNANIAN COMPANIES OF CALIFORNIA, INC.
                              K. HOVNANIAN AT TERRAZA, INC.
                              K. HOVNANIAN DEVELOPMENTS OF CALIFORNIA, INC.
                              KHC ACQUISITION, INC.

                                      21
<PAGE>

                              K. HOVNANIAN AT STUART ROAD, INC.
                              K. HOVNANIAN AT HIGHLAND VINEYARDS, INC.
                              K. HOVNANIAN AT BALLANTRAE, INC.
                              BALLANTRAE HOME SALES, INC.
                              K. HOVNANIAN COMPANIES AT WILDROSE, INC.
                              K. HOVNANIAN AT GREENBROOK, INC.
                              K. HOVNANIAN AT HUNTER ESTATES, INC.
                              K. HOVNANIAN AT CARMEL DEL MAR, INC.
                              K. HOVNANIAN AT VAIL RANCH, INC.
                              K. HOVNANIAN AT PRINCETON, INC.
                              K. HOVNANIAN AT RARITAN I, INC.
                              K. HOVNANIAN AT CALABRIA, INC.
                              K. HOVNANIAN AT SENECA CROSSING, INC.
                              K. HOVNANIAN COMPANIES OF MARYLAND, INC.
                              K. HOVNANIAN DEVELOPMENTS OF MARYLAND, INC.
                              K. HOVNANIAN AT EXETER HILLS, INC.
                              K. HOVNANIAN FLORIDA REGION, INC.
                              K. HOVNANIAN SOUTHEAST FLORIDA, INC.
                              K. HOVNANIAN AT BERLIN, INC.
                              K. HOVNANIAN AT EAST BRUNSWICK VI, INC.
                              K. HOVNANIAN AT BEDMINSTER II, INC.
                              K. HOVNANIAN AT INVERRARY I, INC.
                              K. HOVNANIAN AT MAHWAH IX, INC.
                              K. HOVNANIAN AT NORTHLAKE, INC.
                              K. HOVNANIAN AT HOPEWELL IV, INC.
                              K. HOVNANIAN AT LOCUST GROVE I, INC.
                              K. HOVNANIAN AT CASTILE, INC.
                              K. HOVNANIAN AT TIERRASANTA, INC.
                              K. HOVNANIAN AT PRESTON, INC.
                              K. HOVNANIAN AT BERNARDS III, INC.
                              K. HOVNANIAN AT WAYNE VI, INC.
                              K. HOVNANIAN PROPERTIES OF NORTH CENTER DRIVE,
                              INC.
                              BALLANTRAE DEVELOPMENT CORP.
                              K. HOVNANIAN AT LA TROVATA, INC.
                              K. HOVNANIAN AT RANCHO CRISTIANITOS, INC.
                              K. HOVNANIAN AT TANNERY HILL, INC.
                              K. HOVNANIAN PROPERTIES OF N.B. THEATRE, INC.
                              K. HOVNANIAN AT CRYSTAL SPRINGS, INC.
                              K. HOVNANIAN AT THE CEDARS, INC.
                              K. HOVNANIAN CONSTRUCTION MANAGEMENT, INC.
                              K. HOVNANIAN ACQUISITIONS, INC.
                              K. HOVNANIAN AT BURLINGTON II, INC.
                              K. HOVNANIAN AT BURLINGTON III, INC.
                              K. HOVNANIAN AT BALLANTRAE ESTATES, INC.
                              K. HOVNANIAN AT SMITHVILLE, INC.
                              K. HOVNANIAN AT JEFFERSON, INC.
                              K. HOVNANIAN AT UPPER FREEHOLD
                              TOWNSHIP I, INC.
                              K. HOVNANIAN AT HERSHEY'S MILL, INC.

                                      22
<PAGE>

                              K. HOVNANIAN AT DOMINION RIDGE, INC.
                              K. HOVNANIAN AT PORT IMPERIAL NORTH, INC.
                              K. HOVNANIAN AT UNION TOWNSHIP I, INC.
                              K. HOVNANIAN AT EAST BRUNSWICK VIII, INC.
                              K. HOVNANIAN AT MANALAPAN II, INC.
                              K. HOVNANIAN AT HOPEWELL V, INC.
                              K. HOVNANIAN AT HOPEWELL VI, INC.
                              K. HOVNANIAN AT CAMERON CHASE, INC.
                              K. HOVNANIAN AT THORNBURY, INC.
                              K. HOVNANIAN AT WAYNE VII, INC.
                              K. HOVNANIAN SCOTCH PLAINS II, INC.
                              K. HOVNANIAN AT MARLBORO TOWNSHIP IV, INC.
                              K. HOVNANIAN PORT IMPERIAL URBAN RENEWAL,INC.
                              K. HOVNANIAN AT EAST WHITELAND I, INC.
                              K. HOVNANIAN AT STONEGATE, INC.
                              K. HOVNANIAN AT CRESTLINE, INC.
                              K. HOVNANIAN AT SAN SEVAINE, INC.
                              K. HOVNANIAN AT SYCAMORE, INC.
                              K. HOVNANIAN COMPANIES OF SOUTHERN
                              CALIFORNIA, INC.
                              K. HOVNANIAN AT SMITHVILLE II, INC.
                              K. HOVNANIAN AT STONY POINT, INC.
                              K. HOVNANIAN AT STONE CANYON, INC.
                              K. HOVNANIAN AT TUXEDO, INC.
                              K. HOVNANIAN AT BRIDGEPORT, INC.
                              K. HOVNANIAN AT SARATOGA, INC.
                              K. HOVNANIAN AT CHAPARRAL, INC.
                              K. HOVNANIAN AT OCEAN WALK, INC.
                              K. HOVNANIAN AT LOWER SAUGON II, INC.
                              K. HOVNANIAN AT STONEGATE, INC.
                              K. HOVNANIAN AT BARRINGTON, INC.
                              K. HOVNANIAN AT HAMPTON OAKS, INC.
                              K. HOVNANIAN AT P.C. HOMES, INC.
                              K. HOVNANIAN AT P.C. PROPERTIES, INC.
                              K. HOVNANIAN AT SUMMERWOOD, INC.
                              K. HOVNANIAN AT THE GLEN
                              K. HOVNANIAN'S FOUR SEASONS OF THE PALM
                              BEACHES, INC.
                              K. HOVNANIAN AT WALL TOWNSHIP VIII, INC.
                              K. HOVNANIAN AT NORTH JERSEY ACQUISITION, L.L.C.
                              K. HOVNANIAN CENTRAL ACQUISITION, L.L.C.
                              K. HOVNANIAN SHORE ACQUISITION, L.L.C.
                              K. HOVNANIAN SOUTH JERSEY ACQUISITION, L.L.C.
                              K. HOVNANIAN AT MANSFIELD I, L.L.C.
                              K. HOVNANIAN AT MANSFIELD II, L.L.C.
                              K. HOVNANIAN NORTH CENTRAL
                              ACQUISITION, L.L.C.
                              K. HOVNANIAN AT WAYNE VIII, L.L.C.

                                      23
<PAGE>

                              K. HOVNANIAN AT BERNARDS V, L.L.C.
                              K. HOVNANIAN AT WANAQUE, L.L.C.
                              K. HOVNANIAN AT CHESTER I, L.L.C.
                              K. HOVNANIAN AT WINCHESTER, L.L.C.
                              K. HOVNANIAN AT MIDDLETOWN, L.L.C.
                              K. HOVNANIAN'S FOUR SEASONS, L.L.C.
                              K. HOVNANIAN AT MENIFEE, L.L.C.
                              K. HOVNANIAN AT NORTH BRUNSWICK VI, L.L.C.
                              K. HOVNANIAN AT CARMEL VILLAGE, L.L.C.
                              K. HOVNANIAN AT LAWRENCE, L.L.C.
                              K. HOVNANIAN AT BLUE HERON PINES, L.L.C.
                              K. HOVNANIAN AT JACKSON, L.L.C.
                              K. HOVNANIAN AT ROLAND HEIGHTS, L.L.C.
                              K. HOVNANIAN AT BERKELEY, L.L.C.
                              K. HOVNANIAN AT KING FARM, L.L.C.
                              K. HOVNANIAN AT SOUTH BANK, L.L.C.
                              K. HOVNANIAN AT PRINCE WILLIAM, L.L.C.
                              K. HOVNANIAN AT LAKE TERRAPIN, L.L.C.
                              K. HOVNANIAN AT GUTTENBERG, L.L.C.
                              K. HOVNANIAN AT KING FARM, L.L.C.
                              K. HOVNANIAN AT SOUTH BANK, L.L.C.
                              K. HOVNANIAN AT CLIFTON, L.L.C.
                              K. HOVNANIAN AT JERSEY CITY IV, L.L.C.
                              K. HOVNANIAN AT LAFAYETTE ESTATES, L.L.C.
                              K. HOVNANIAN AT UPPER FREEHOLD
                              TOWNSHIP II, L.L.C.
                              K. HOVNANIAN AT KINCAID, L.L.C.
                              K. HOVNANIAN AT LINWOOD, L.L.C.
                              K. HOVNANIAN AT SOUTH AMBOY, L.L.C.
                              K. HOVNANIAN AT UPPER FREEHOLD TOWNSHIP III,
                              L.L.C.
                              K. HOVNANIAN AT BRENBROOKE, L.L.C.
                              K. HOVNANIAN AT BLOOMS CROSSING, L.L.C.
                              K. HOVNANIAN AT SPRING HILL ROAD, L.L.C.
                              K. HOVNANIAN AT ST. MARGARETS, L.L.C.
                              K. HOVNANIAN AT PARAMUS, L.L.C.
                              K. HOVNANIAN AT WILLOW BROOK, L.L.C.
                              K. HOVNANIAN AT WEST MILFORD, L.L.C
                              WHI HOLDING CO., INC.



                              By: ______________________________  _____________
                                  Name:
                                  Title:

                                      24
<PAGE>

DONALDSON, LUFKIN & JENRETTE
SECURITIES CORPORATION


By: ______________________________  ______________
    Name:
    Title:


SALOMON SMITH BARNEY INC.


By: ______________________________
    Name:
    Title:


PNC CAPITAL MARKETS, INC.


By: ______________________________
    Name:
    Title:

                                      25