<PAGE>

                                                                    EXHIBIT 10.3

                              AMENDED AND RESTATED
                         REVOLVING CREDIT LOAN AGREEMENT

                           GREENWOOD FINANCIAL, INC.,
                             A DELAWARE CORPORATION,
                             AND CERTAIN AFFILIATES
                                    BORROWERS

                           ORLEANS HOMEBUILDERS, INC.,
                             A DELAWARE CORPORATION
                                    GUARANTOR

                       WACHOVIA BANK, NATIONAL ASSOCIATION
                              ADMINISTRATIVE AGENT

                          WACHOVIA CAPITAL MARKETS, LLC
                                  LEAD ARRANGER

                              BANK OF AMERICA, N.A.
                                SYNDICATION AGENT
                                 SOVEREIGN BANK
                               DOCUMENTATION AGENT
                     MANUFACTURERS AND TRADERS TRUST COMPANY
                               DOCUMENTATION AGENT
                               NATIONAL CITY BANK
                               DOCUMENTATION AGENT
                       WACHOVIA BANK, NATIONAL ASSOCIATION
                                 FIRSTRUST BANK
                                  GUARANTY BANK
                         U.S. BANK NATIONAL ASSOCIATION
                          CITIZENS BANK OF PENNSYLVANIA
                               COMMERCE BANK, N.A.
                                  SUNTRUST BANK
                                  AMSOUTH BANK
                               FRANKLIN BANK, SSB
                                  COMERICA BANK
                  COMPASS BANK, AN ALABAMA BANKING CORPORATION
                            JPMORGAN CHASE BANK, N.A.
                        LASALLE BANK NATIONAL ASSOCIATION
                      DEUTSCHE BANK TRUST COMPANY AMERICAS
                                     LENDERS

                                  $650,000,000
          SENIOR SECURED REVOLVING CREDIT AND LETTER OF CREDIT FACILITY

                         DATED: AS OF JANUARY 24 , 2006


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                                TABLE OF CONTENTS
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ARTICLE I. DEFINITIONS............................................................................................1

         1.1      Definitions.....................................................................................1

         1.2      Construction of Terms..........................................................................13

         1.3      Accounting Reports and Principles..............................................................14

         1.4      Business Day; Time.............................................................................14

         1.5      Charging Accounts..............................................................................14

         1.6      Lenders' Costs.................................................................................14

ARTICLE II. AMOUNT AND TERMS OF THE FACILITY; SECURITY FOR THE FACILITY..........................................15

         2.1      The Facility...................................................................................15

         2.2      Term of Facility...............................................................................18

         2.3      Repayment Terms................................................................................18

         2.4      Interest Rate..................................................................................20

         2.5      Interest after Maturity........................................................................21

         2.6      Fees Payable by Borrowers......................................................................21

         2.7      Prepayments....................................................................................23

         2.8      No Setoff or Deduction.........................................................................23

         2.9      Illegality.....................................................................................23

         2.10     Notes..........................................................................................23

         2.11     Security.......................................................................................24

         2.12     General Provisions.............................................................................24

         2.13     Postponement of Maturity Date..................................................................27

         2.14     Swap Contracts.................................................................................28

ARTICLE III. NOTICE OF BORROWING; BORROWING BASE;  BORROWING BASE AVAILABILITY...................................29

         3.1      Notice of Borrowing............................................................................29

         3.2      Admission of Projects to Borrowing Base........................................................29

         3.3      Borrowing Base Availability....................................................................29

         3.4      Submission of Borrowing Base Certificate.......................................................32

         3.5      Inspection of Projects.........................................................................32
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ARTICLE IV. CONDITIONS OF LENDING................................................................................32

         4.1      Agreement to Make Available the Facility.......................................................32

         4.2      Availability of Letters of Credit and Tri-Party Agreements.....................................35

         4.3      Conditions Precedent to Swing Line Loans.......................................................36

ARTICLE V. REPRESENTATIONS AND WARRANTIES........................................................................36

         5.1      Use of Proceeds................................................................................36

         5.2      Incorporation, Good Standing, and Due Qualification............................................36

         5.3      Power and Authority............................................................................37

         5.4      Legally Enforceable Agreement..................................................................37

         5.5      Financial Statements; Accuracy of Information..................................................37

         5.6      Conflicts......................................................................................38

         5.7      Consents.......................................................................................38

         5.8      Litigation.....................................................................................38

         5.9      Other Agreements...............................................................................38

         5.10     No Defaults and Outstanding Judgments or Orders................................................39

         5.11     Taxes..........................................................................................39

         5.12     Debt...........................................................................................39

         5.13     Ownership and Liens............................................................................39

         5.14     ERISA..........................................................................................39

         5.15     Representations and Warranties as to Real Estate...............................................39

         5.16     No Violation...................................................................................40

         5.17     Accurate and Complete Disclosure...............................................................40

         5.18     Compliance with Covenants......................................................................40

ARTICLE VI. AFFIRMATIVE COVENANTS................................................................................41

         6.1      Reporting Requirements.........................................................................41

         6.2      Payment of Taxes...............................................................................42

         6.3      Access to Properties, Books and Records........................................................42

         6.4      Maintenance of Records.........................................................................42

         6.5      Maintenance of Existence.......................................................................43

         6.6      Insurance......................................................................................43

         6.7      ERISA..........................................................................................44

         6.8      Accounts.......................................................................................45

         6.9      Compliance with Laws...........................................................................45

         6.10     Payment of Debt................................................................................45

         6.11     Consequential Damages..........................................................................45

         6.12     Further Assurances.............................................................................45
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                                       ii

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ARTICLE VII. NEGATIVE COVENANTS..................................................................................45

         7.1      Creation of Debt...............................................................................46

         7.2      Grant of Liens.................................................................................47

         7.3      Mergers and Acquisitions.......................................................................47

         7.4      Transaction With Affiliates....................................................................47

         7.5      Use of Proceeds................................................................................47

ARTICLE VIII. FINANCIAL COVENANTS................................................................................47

         8.1      Interest Coverage..............................................................................48

         8.2      Consolidated Tangible Net Worth................................................................48

         8.3      Leverage.......................................................................................48

         8.4      Investments in Joint Ventures..................................................................48

         8.5      Ownership of Land..............................................................................48

         8.6      Units in Inventory.............................................................................49

         8.7      Reports Regarding Financial Covenants..........................................................49

ARTICLE IX. EVENTS OF DEFAULT....................................................................................49

ARTICLE X. REMEDIES..............................................................................................51

         10.1     Remedies of Lenders............................................................................51

         10.2     Effect of Delay................................................................................51

         10.3     Acceptance of Partial Payment..................................................................51

         10.4     Other Available Remedies.......................................................................52

         10.5     Waiver of Marshalling of Assets................................................................52

         10.6     Waiver of Counterclaim.........................................................................52

ARTICLE XI. THE AGENT............................................................................................52

         11.1     Appointment....................................................................................52

         11.2     Delegation of Duties...........................................................................53

         11.3     Exculpatory Provisions.........................................................................53

         11.4     Reliance by Agent..............................................................................53

         11.5     Non-Reliance on Agent and Other Lenders........................................................54

         11.6     Indemnification................................................................................54

         11.7     Consequential Damages..........................................................................55

         11.8     Agent in Its Individual Capacity...............................................................55

         11.9     Resignation or Removal of Agent as Administrative Agent........................................55

         11.10    Amendments, Waivers and Consents...............................................................55

         11.11    Authority......................................................................................56

         11.12    Borrower Default...............................................................................56

         11.13    Lender Default.................................................................................57

         11.14    Ratable Sharing................................................................................58

         11.15    Documentation..................................................................................59
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                                      iii

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ARTICLE XII. PARTICIPATION BY LENDERS IN SWING LINE LOANS........................................................59

         12.1     Purchase and Sale of Participation.............................................................59

         12.2     Sharing of Interest and Expenses...............................................................59

         12.3     Assignment of Participation Interests..........................................................59

         12.4     Administration of Swing Line Loans.............................................................60

ARTICLE XIII. MISCELLANEOUS......................................................................................60

         13.1     Modifications..................................................................................60

         13.2     Binding Nature.................................................................................60

         13.3     Governing Law..................................................................................60

         13.4     Time of Performance............................................................................60

         13.5     Severability...................................................................................60

         13.6     Captions.......................................................................................60

         13.7     Computations...................................................................................60

         13.8     Continuing Obligation..........................................................................60

         13.9     Assignment and Participation...................................................................61

         13.10    Notices........................................................................................63

         13.11    Cumulative Remedies............................................................................68

         13.12    Third Party Beneficiaries......................................................................68

         13.13    Prior Understandings...........................................................................68

         13.14    Counterparts...................................................................................68

         13.15    Indemnification................................................................................68

         13.16    Relationship of Parties........................................................................69

         13.17    Joint and Several Liability....................................................................70

         13.18    Publicity......................................................................................70

         13.19    No Implied Waiver..............................................................................70

         13.20    USA Patriot Act................................................................................70

         13.21    Taxes..........................................................................................70

         13.22    Conflict; Construction of Documents; Reliance..................................................70

         13.23    Jurisdiction...................................................................................71

         13.24    Waiver of Jury Trial...........................................................................71

         13.25    Counterparts...................................................................................71

         13.26    Entire Agreement...............................................................................71

         13.27    Original Credit Agreement; No Novation.........................................................72
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                                       iv
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Schedules and Exhibits

1.1A     -  Schedule of Borrowers
1.1B     -  Schedule of Commitments
1.1C     -  Form of Joinder
1.1D     -  Schedule of Outstanding Letters of Credit and Tri-Party Agreements
1.1E     -  Form of Line of Credit Note
1.1F     -  Notice of Borrowing of a Loan
2.1.4.1  -  Form of Application and Agreement for Irrevocable Standby
            Letter of Credit
3.4      -  Form of Borrowing Base Certificate
5.8      -  Schedule of Litigation
8.7      -  Form of Covenant Compliance Certificate
13.9     -  Form of Assignment and Acceptance


                                       v
<PAGE>

                              AMENDED AND RESTATED
                         REVOLVING CREDIT LOAN AGREEMENT


This Amended and Restated Revolving Credit Loan Agreement ("this Agreement"),
made as of the 24th day of January, 2006, by and among GREENWOOD FINANCIAL,
INC., a Delaware corporation ("MASTER BORROWER"), each of the other entities
identified on Schedule 1.1A that is attached hereto as Borrowers, the Lenders
who are or may become a party hereto, and WACHOVIA BANK, NATIONAL ASSOCIATION,
as Agent for the Lenders ("AGENT").

                                   BACKGROUND


         A. Master Borrower is a corporation principally formed to engage in
financing transactions with and on behalf of the Guarantor and the other
Borrowers. Each of the other Borrowers is a corporation, limited partnership or
limited liability company formed to acquire land in one or more of the States of
Pennsylvania, New Jersey, New York, Maryland, Illinois, Delaware, Virginia,
North Carolina, South Carolina, Florida and Arizona, to improve such land with
residential dwellings, and to sell such dwellings, or to invest in Eligible
Affiliates formed for such purposes (the "BUSINESS").

         B. Pursuant to a Revolving Credit Loan Agreement dated as of December
22, 2004 (the "ORIGINAL CREDIT AGREEMENT"), executed by Master Borrower, certain
of the other Borrowers, Agent and certain of the Lenders, such Lenders agreed to
provide a credit facility to Borrowers on the terms and conditions contained in
the Original Credit Agreement.

         C. Borrowers desire to establish an increased credit facility with
Lenders for the benefit of Borrowers to finance Borrowers' acquisition of
residential real estate and construction activities. Lenders have agreed to
extend such credit facility to Borrowers, subject to the terms and conditions
hereinafter more particularly set forth.

         NOW, THEREFORE, in consideration of their mutual covenants and
agreements herein contained, the parties hereto hereby amend and restate the
Original Credit Agreement in full and, intending to be legally bound, hereby
agree as follows:

                             ARTICLE I. DEFINITIONS

         1.1 Definitions. In addition to other words and terms defined elsewhere
in this Agreement, as used in this Agreement, the following words and terms
shall have the following meanings, respectively, unless the context hereof
otherwise clearly requires:

         "Adjusted EBITDA" means, with respect to a Relevant Accounting Period,
(i) GAAP net income, plus (to the extent deducted to determine GAAP net income)
(ii) state and federal income taxes, plus (iii) depreciation and amortization,
plus (iv) interest expensed in the cost of goods sold, plus (v) interest
expensed from operations.

         "Advance" means the cash which Lenders advance to a Borrower under the
Facility, all subject to and in accordance with the provisions of Article II
hereof.
<PAGE>

         "Affiliate" means and refers to, as applied to any Person, any other
Person directly or indirectly controlling, or through one or more Persons is
controlled by, controlling or in common control with that Person. "Control"
(including with correlative meanings, the terms "controlling," "controlled by"
and "under common control with"), as applied to any Person, means the
possession, directly or indirectly, of the power to direct or cause the
direction of the management and/or policies of that Person, whether through the
ownership of voting securities, by contract, or otherwise.

         "Agent" means Wachovia Bank, National Association, in its capacity as
agent for Lenders, and any successor thereto appointed pursuant to Section 11.9.

         "Agreement" means this Revolving Credit Loan Agreement, and any
schedules, exhibits, riders, extensions, supplements, amendments, or
modifications to this Revolving Credit Loan Agreement.

         "Applicable Spread" means the rate per annum determined from time to
time in accordance with the following:
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         (i)      If the relevant Leverage Ratio is:                         the Applicable Spread shall be:
                  Not greater than 1.75:1                                    1.65% (165 "basis points")
                  Greater than 1.75:1 and not greater than 2.00:1            1.875% (187.5 "basis points")
                  Greater than 2.00:1 and not greater than 2.50:1            2.00% (200 "basis points")
                  Greater than 2.50:1 and not greater than 3.00:1            2.125% (212.5 "basis points")
                  Greater than 3.00:1                                        2.25% (225 "basis points")
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         (ii). If, based on the Covenant Compliance Certificate most recently
delivered by Borrowers, the ratio of (x) the book value of all land owned by
Borrowers, Guarantor or any subsidiary of a Borrower or of Guarantor which is
not subject to a Qualifying Agreement of Sale and on which no Unit is
constructed or under construction to (y) Consolidated Adjusted Tangible Net
Worth exceeds 1.50:1, the Applicable Spread that is determined pursuant to the
foregoing clause (i) shall be increased by one-eighth of one percent (0.125%)
per annum (that is, by 12.5 "basis points").

         (iii). The Applicable Spread shall be adjusted quarterly as provided in
Section 2.4.2.

         "Appraisal" means an appraisal or re-appraisal of a Project that (i) is
directed to Agent and, if the Project is not admitted to the Borrowing Base as
of the date hereof, is dated not earlier than six (6) months before the date the
Project is admitted to the Borrowing Base, (ii) contains terms and conditions
satisfactory to Agent and (iii) conforms in all respects to Title X of the
Federal Financial and Institutional Reform, Recovery and Enforcement Act of 1989
(FIRREA). The Borrowers shall be responsible for the cost of each Appraisal as
Lenders' Costs.

         "Appraised Value" means, with respect to the Real Estate, Units and
Improvements in any Project, the value thereof as determined pursuant to Section
3.3.2.6. The "Appraised Value" of Improved Land and Units shall be determined on
an "as completed" basis.

         "Approved Jurisdiction" means the States or Commonwealths of
Pennsylvania, New Jersey, New York, Maryland, Illinois, Delaware, Virginia,
North Carolina, South Carolina, Florida and Arizona, and also such other State
or Commonwealth as may from time to time be approved by Requisite Lenders.

                                       2
<PAGE>

         "Approved Land" means land that has received all Governmental Approvals
necessary for immediate development as for-sale residential housing, other than
building permits; provided that land that has received all such Governmental
Approvals except for state- and federally-issued permits (but not local
subdivision and land development approvals, [which may, however, be conditioned
upon the receipt of state- and federally-issued permits]) that the owning
Borrower in good faith believes will be issued within 120 days may be included
in the Borrowing Base as "Approved Land" for a period of 120 days, provided
further that if all such state- and federally-issued permits are not issued
within such 120 day period, such land shall no longer be deemed to be "Approved
Land" until all such state- and federally-issued permits are actually obtained.

         "Authorized Signer" means any of the Persons listed on the certificate
to be delivered to Agent at Closing in accordance with Section 4.1.5 or on any
replacement certificate with respect thereto subsequently delivered to Agent at
any time.

         "Bankruptcy Code" means Title 11 of the United States Code as now or
hereafter in effect, or any successor statute.

         "Borrower" means, individually and at any time, Master Borrower, each
Person identified on Schedule 1.1A and each Eligible Affiliate which has
theretofore qualified as a "Borrower" pursuant to Section 2.1.1.3.

         "Borrowing Base" means at any time the Real Estate, Improvements and
Units (excluding (i) dwelling units in any mid-rise or high-rise structure
containing more than three (3) stories of space for residential occupancy and
(ii) any asset classified as "Inventory not Owned" (FASB 46) on Guarantor's or
any Borrower's balance sheet) that are part of Projects, subject to the
limitations contained in this Agreement. The Borrowing Base shall change from
time to time as provided herein. The Borrowing Base may not include any Real
Estate, Improvements or Units (i) owned by a Borrower that is not a wholly-owned
Affiliate of Guarantor or (ii) prior to the Collateral Release Date, that is not
encumbered by a Mortgage.

         "Borrowing Base Availability" means, at any time, (i) the amount
determined pursuant to Section 3.3, based on the most recently delivered
Borrowing Base Certificate, minus (ii) the aggregate amount of liability of
Agent under then-outstanding Financial Letters of Credit, minus (iii) the
aggregate outstanding amount of all Swing Line Loans, minus (iv) the aggregate
principal amount of all Permitted Subordinated Debt that by its terms matures
within one (1) year.

         "Borrowing Base Certificate" means a certificate in the form as shown
on Exhibit 3.4, attached hereto, the purpose of which is to state, on a per Lot
and per Unit basis, the amount of the Borrowing Base Availability as of the date
thereof.

         "Business Day" means any day other than a Saturday, a Sunday, a public
holiday under the laws of the Commonwealth of Pennsylvania or of the State of
North Carolina or another day on which banking institutions in such
jurisdictions are authorized or obligated to close.



                                       3
<PAGE>

         "Capital Lease" means all leases that have been or should be
capitalized on the books of the lessee in accordance with GAAP.

         "Closing" and "Closing Date" mean to date on which each of the Loan
Documents has been executed and delivered by all of the parties thereto and
Borrowers have satisfied all of the conditions contained in Section 4.1.

         "Code" means the Internal Revenue Code of 1986, as amended from time to
time, and the regulations and published interpretations thereof.

         "Collateral" means, at any time, all real, personal or other property
that is encumbered by a Mortgage or is otherwise subject to a Lien as security
for the Indebtedness and Obligations.

         "Collateral Release Date" has the meaning defined in Section 2.11.2.

         "Commitment" means, as to any Lender, the obligation of such Lender to
make Loans to Borrowers hereunder and to honor drawings and demands under
Letters of Credit and Tri-Party Agreements issued or executed hereunder, in an
aggregate principal or face amount at any time outstanding not to exceed the
amount set forth opposite such Lender's name on Schedule 1.1B hereto, as the
same may be reduced or modified at any time or from time to time pursuant to the
terms hereof.

         "Consolidated Adjusted Tangible Net Worth" means, as of any date, the
sum of (i) Guarantor's Consolidated Tangible Net Worth plus (ii) the lesser of
(x) one-half (1/2) of the outstanding principal amount of all Permitted
Subordinated Debt of Guarantor that matures no sooner than twelve (12) months
after such date or (y) thirty percent (30%) of Guarantor's Consolidated Tangible
Net Worth.

"Consolidated Tangible Net Worth" means, as of any date, (i) Guarantor's GAAP
net worth minus (ii) goodwill, patents, trademarks, tradenames, organization
expense, unamortized debt discount and expense, deferred marketing expenses and
other intangibles as shown in the Financial Statements as of the last day of the
Last Reported Fiscal Quarter.

"Consolidated Total Assets" means, as of any date, all assets of Guarantor, as
shown on Guarantor's most recent Financial Statements.

"Consolidated Total Indebtedness" and "Debt" mean, for any Person as of any
date, without duplication, all (i) indebtedness or liability for borrowed money;
(ii) obligations, whether or not for money borrowed (a) represented by notes
payable, or drafts accepted, in each case representing extensions of credit, (b)
evidenced by bonds, debentures, notes or similar instruments, or (c)
constituting purchase money indebtedness, title retention debt instruments or
other similar instruments, upon which interest charges are customarily paid or
that are issued or assumed as full or partial payment for property or services
rendered; (iii) master lease obligations and obligations that are treated as
capitalized leases under GAAP; (iv) reimbursement obligations under surety
bonds, letters of credit and/or tri-party agreements issued with respect to
Improvements (whether or not the same have been presented for payment); (v)
reimbursement obligations under Financial Letters of Credit and surety bonds
(regardless of whether the same have been presented for payment); (vi)
obligations, contingent or otherwise, under any synthetic lease, tax retention
operating lease, off balance sheet loan or similar off balance sheet financing
arrangement if the transaction giving rise to such obligation (a) is considered
indebtedness for borrowed money for tax purposes but is classified as an
operating lease under GAAP and (b) does not (and is not required pursuant to
GAAP to) appear as a liability on the balance sheet of a Person; (vii)
liabilities arising under any "swap agreement" (as that term is defined in 11
U.S.C. ss. 101, as heretofore or hereafter amended; and (viii) without
duplication, alL liabilities of third parties of the type described in
(i)-(vii), inclusive, that are guaranteed by or otherwise recourse to a Person,
whether or not the obligations have been assumed.



                                       4
<PAGE>

"Covenant Compliance Certificate" means a certificate in the form attached
hereto as Exhibit 8.7.

"Cost Incurred" means, at any time with respect to Lots and Units, the
then-current book value thereof, determined in accordance with GAAP.

"Debt Service" means, with respect to a Relevant Accounting Period, (i) interest
paid (whether expensed or capitalized) as reported on Guarantor's Financial
Statements, plus (ii) required principal payments on any Debt (excluding (a)
with respect to any permitted purchase money mortgage debt, release prices paid
upon the conveyance of any Unit and (b) principal payments of Loans, Swing Line
Loans and Letter of Credit Advances) plus (iii) mandatory preferred stock
dividends.

"Default Rate" means a rate of interest that is equal to the applicable Interest
Rate otherwise payable with respect to Loans plus four percent (4%) per annum.

"Deposit Account" means a demand, time, savings, passbook or like account with a
federally insured bank or savings and loan association, other than an account
evidenced by a negotiable certificate of deposit.

"Designated Officer" means Julie Pasceri-Young or any other person designated in
writing by Agent as its representative for the purpose of receiving notice
hereunder.

"Development Land" means Approved Land on which the construction of Improvements
has been commenced and is in process.

"Dollars" and the sign "$" mean lawful money of the United States of America.

"Eligible Affiliate" means an entity that, directly or indirectly, is 100% owned
by Guarantor.

"Eligible Investor" means a commercial bank, savings bank, savings and loan
association or other similar financial institution, insurance company and mutual
fund having total assets of $1,000,000,000 or more, generally engaged in lending
of the type of the Facility and in full compliance with all FDIC Control Act
requirements or other regulatory requirements.

"Environmental Condition" means any condition affecting (i) the work place where
business operations take place, or (ii) any natural resource, including without
limitation the air, soil, surface and groundwater, which must be reported to a
Governmental Authority or which must be remediated under any of the
Environmental Laws.



                                       5
<PAGE>

"Environmental Law" means any presently existing or hereafter enacted or decided
federal, state or local statutory or common law relating to pollution or
protection of the environment, including without limitation, any common law of
nuisance or trespass, and any law or regulation relating to emissions,
discharges, releases or threatened release of pollutants, contaminants or
chemicals or industrial, toxic or hazardous substances or wastes into the
environment (including without limitation, ambient air, surface water,
groundwater, land surface or subsurface strata) or otherwise relating to the
manufacture, processing, distribution, use, treatment, storage, disposal,
transport or handling of pollutants, contaminants or chemicals, or industrial,
toxic or hazardous substances or wastes.

"Environmental Report" means a Phase I (and, if recommended by a Phase I, a
Phase II) environmental site assessment that is (i) prepared with respect to
Real Estate in accordance with Agent's then-current protocol for environmental
studies of land for residential development by a qualified environmental
engineer acceptable to Agent in its reasonable business judgment, (ii) if the
Real Estate is not part of a Project that is admitted to the Borrowing Base as
of the date hereof, dated not earlier than twelve (12) months prior to the
Project's admission to the Borrowing Base and (iii) if not addressed to Agent,
as agent for the Lenders, accompanied by a reliance letter (in form acceptable
to Agent in good faith) addressed to Agent as agent for the Lenders. Borrowers
shall be responsible for the cost of each such Environmental Assessment.

"ERISA" means the Employee Retirement Income Security Act of 1974, as amended
from time to time, and the regulations and published interpretations thereof.

"ERISA Affiliate" means any trade or business (whether or not incorporated),
which together with any Borrower or Guarantor (or some or all of them) would be
treated as a single employer under Section 4001 of ERISA.

"Event of Default" or "Default" means any of the events specified in Article IX,
and elsewhere in this Agreement, upon the occurrence of which the Lenders may
exercise their rights and remedies hereunder and/or under the other Loan
Documents.

"Facility" means the credit facility under which (i) Loans may be borrowed,
repaid and reborrowed, in the maximum outstanding amount of the Revolving
Sublimit, (ii) Letters of Credit and Tri-Party Agreements (including those
presently existing) may be issued or executed by an Issuer on behalf of Lenders
in the aggregate maximum undrawn amount not exceeding, at any time, the Letter
of Credit Sublimit, and (iii) Swing Line Loans may be borrowed, repaid and
reborrowed in the maximum outstanding amount of the Swing Line Limit, all as
more fully described in Article II.

"Facility Amount" means $650,000,000, which includes the $125,000,000 Letter of
Credit Sublimit and the $25,000,000 Swing Line Limit, and shall be subject to
increase in accordance with the provisions of Section 2.1.1.2.

"Financial Letters of Credit" has the meaning defined in Section 2.1.2.

"Financial Statements" mean the reports of financial condition required to be
delivered pursuant to Sections 6.1.1 and 6.1.2.



                                       6
<PAGE>

"Fiscal Quarter" means each of the three (3) month periods that ends on the last
day of the third (3rd), sixth (6th), ninth (9th) and twelfth (12th) months of a
Fiscal Year.

"Fiscal Year" means the period of twelve (12) consecutive calendar months on the
basis of which Guarantor reports its income for GAAP purposes, which twelve (12)
month period currently ends on each June 30.

"Funding Date" means the Business Day on which a Loan is advanced.

"GAAP" means generally accepted accounting principles as set forth in the
opinions and pronouncements of the Accounting Principles Board of the American
Institute of Certified Public Accountants and statements and pronouncements of
the Financial Accounting Standards Board as in effect on the date hereof or in
such other statements by such other Person as may be approved by a significant
segment of the accounting profession, which are applicable to the circumstances
as of the date of determination and which are applied on a consistent basis.

"Governmental Approvals" means all authorizations, consents, approvals, permits,
licenses and exemptions of, registrations and filings with, and reports to, all
Governmental Authorities.

"Governmental Authority" means any federal, state, local or foreign government
and any agency, commission, or other entity thereof.

"Guarantor" means Orleans Homebuilders, Inc., a Delaware corporation.

"Guaranty" means the guaranty and suretyship agreement executed by the Guarantor
pursuant to Section 2.11.1.1.

"Improved Land" means Approved Land that is fully developed with Improvements
that have been completed (other than the finish paving of streets).

"Improvements" means the site improvements required for the development,
improvement and sale of a Project, including, but not limited to, roads, curbs,
sidewalks, storm water drainage lines and facilities and water and sewer lines
and facilities.

"Indebtedness" means all amounts due from Borrowers to Lenders (or any of them)
or Agent in respect of Loans, Letter of Credit Advances, Swing Line Loans, Swap
Contracts (but only those Swap Contracts that a Borrower has elected be part of
the Indebtedness, in accordance with Section 2.14 hereof) and otherwise arising
out of in connection with this Agreement or any other Loan Document.

"Interest Rate" means, on any day, the sum (expressed as a per annum rate of
interest) of (i) the LIBOR Market Index Rate as of such day plus (ii) the
Applicable Spread in effect on such day.

"Issuer" means (i) each Lender that has heretofore issued a Letter of Credit or
executed a Tri-Party Agreement and (ii) Agent.

"Joinder" means a joinder and assumption agreement, in the form attached hereto
as Exhibit 1.1C, to be executed by each Eligible Affiliate that hereafter
becomes a Borrower and to be attached to each Note, whereby such Eligible
Affiliate shall assume and agree to pay, jointly and severally with all other
Borrowers, the Indebtedness.



                                       7
<PAGE>

"Joint Venture" means an entity that is engaged principally in the business of
for-sale residential real estate and in which Guarantor, directly or indirectly,
owns at least a 30% interest.

"Land" means, at any time, Raw Land, Approved Land, Development Land and
Improved Land, excluding Lots (i) that are subject to Qualifying Agreement of
Sale or (ii) on which Units are then being constructed.

"Last Reported Fiscal Quarter" means, on any date, the later of (i) the Fiscal
Quarter most recently concluded that ended at least 50 days before such date or
(ii) the most recent Fiscal Quarter with respect to which Borrower has delivered
to Agent a report as required by Section 6.1.2.

"Lender" means each Person executing this Agreement as a Lender, as set forth on
the signature pages hereto, and each Person that hereafter becomes a party to
this Agreement as a Lender pursuant to Section 13.9.

"Lenders' Costs" means all costs and expenses of any kind paid or incurred by
Agent or Lenders in connection with the preparation, execution, delivery,
amendment, modification or termination of this Agreement or any other Loan
Document, any amendments thereto, any transaction contemplated herein or any
existing or future related agreements and the preservation, enforcement, defense
and protection of Lenders' rights, remedies, obligations and liabilities in any
manner concerning this Agreement or any other Loan Document, any transaction
contemplated herein or any existing or future related agreements, including, but
not limited to: (a) reasonable attorneys' fees and other expenses paid or
incurred by Agent in enforcing, obtaining legal advice in preparing, reviewing,
consummating, amending, restructuring, extending, terminating, defending, or
preserving or protecting Lenders' rights, remedies, obligations or liabilities
in any manner concerning, this Agreement, any other Loan Document or any
amendments thereto, any transaction contemplated herein or any existing or
future related agreements; (b) wire transfer charges in such amounts as Agent
may from time to time establish for such service; and (c) all recording,
appraisal, environmental, title insurance, property and liability insurance,
flood certification and Project inspection fees, costs and premiums associated
with each Project that is admitted to the Borrowing Base. "Lenders' Costs" shall
not, however, include any fees or expenses paid or incurred by any individual
Lender other than costs of enforcement incurred while an Event of Default
exists.

"Letter of Credit" means (a) each letter of credit identified on Schedule 1.1D
which has heretofore been issued with respect to a Project or to developments
previously completed by a Borrower, (b) each letter of credit issued by Agent on
behalf of the Lenders for the benefit of Borrower, such letters of credit that
are to be issued by Agent to be for the purpose of providing security for (i)
the construction by a Borrower of Improvements and other municipal and public
facilities related to Projects deemed to be financed under the Revolving
Sublimit by their inclusion in the Borrowing Base, (ii) maintenance by a
Borrower of Improvements and other municipal and public facilities related to
the Projects financed under the Revolving Sublimit, (iii) deposits under
purchase contracts for residential land to which a Borrower is a party and (iv)
general corporate purposes that are necessary for the operation of the Business
of any Borrower, including for maintenance by a Borrower or by an Eligible
Affiliate of public improvements with respect to a residential development that
is not, and has not been, a Project and (c) any letter of credit issued by Agent
in favor of any bank that is not a Lender to secure any Borrower's reimbursement
obligations on account of letters of credit and tri-party agreements issued by
such bank of the type described in clause (b) (i) or (b) (ii) of this definition
or in the definition of "Tri-Party Agreement contained herein, as identified on
Schedule 1.1.D.



                                       8
<PAGE>

"Letter of Credit Advance" has the meaning defined in Section 2.1.4.4.

"Letter of Credit Sublimit" means $125,000,000.

"Leverage Ratio" means, at any time, the ratio of Guarantor's Consolidated Total
Indebtedness to Guarantor's Consolidated Adjusted Tangible Net Worth.

"LIBOR Market Index Rate" means, for any day, the rate of one (1) month U.S.
Dollar deposits as reported on Telerate page 3750 as of 11 a.m., London time, on
such day, or if such day is not a London business day, then the immediately
preceding London business day (or, if not so reported, then as determined by
Agent from another recognized source or interbank quotation).

"Lien" means any mortgage, deed of trust, pledge, security interest,
hypothecation, assignment, deposit arrangement, encumbrance, lien (statutory or
other), or preference, priority, or other security agreement or preferential
arrangement, charge, or encumbrance of any kind or nature whatsoever (including,
without limitation, any conditional sale or other title retention agreement, any
financing lease having substantially the same economic effect as any of the
foregoing, and the filing of any financing statement under the Uniform
Commercial Code or comparable law of any jurisdiction to evidence any of the
foregoing).

"Line of Credit" means the commitment of Lenders to make Loans to Borrowers from
time to time in the maximum aggregate amount equal to the lesser of (i) the
Revolving Sublimit or (ii) the amount of then-current Borrowing Base
Availability.

"Line of Credit Note" means each of the promissory notes made by Master Borrower
and each Eligible Affiliate that is party to this Agreement as of the date
hereof, payable to the order of each Lender and substantially in the form of
Exhibit 1.1E hereto, evidencing the Facility, and any amendments and
modifications thereto, any substitutes therefor, and any replacements,
restatements, renewals or extension thereof, in whole or in part.

"Loan" or "Loan(s)" means, individually or collectively, the Line of Credit and
any advances thereunder.

"Loan Document(s)" means this Agreement, the Notes, the Mortgages, the Guaranty
Letters of Credit and all documents executed in connection with the Loans
evidenced by this Agreement and the Notes, and may include, without limitation,
all certificates issued with respect to any of the foregoing and any renewals or
modifications thereof.

"Loan Fees" means the various fees payable by Borrowers from time to time
pursuant to Section 2.6.



                                       9
<PAGE>

"Lot" or "Lots" shall mean the portions of Real Estate that have been approved
for construction thereon of a single family Unit.

"Master Borrower" means Greenwood Financial, Inc., a Delaware corporation.

"Material Adverse Effect" means, with respect to any Person, a material and
adverse effect upon the business, assets, financial condition or results of
operations of such Person and its subsidiaries taken as a whole, and, with
respect to Borrowers and Guarantor, their ability to perform their respective
obligations under the Loan Documents in accordance with their respective terms.

"Maturity Date" means December 20, 2008, subject to Section 2.13.

"Mortgage" or "Mortgages" means the mortgages or deeds of trust (as appropriate
for the jurisdiction in which the Project subject thereto is located) granted to
Agent (for the ratable benefit of the Lenders) or to a wholly-owned subsidiary
of Agent as trustee for Agent (including master consolidations and restatements
of the Assigned Security Instruments) (for the ratable benefit of the Lenders),
which shall be security for the repayment of the Indebtedness, and shall
constitute first lien(s) upon the Project(s). The Mortgages shall be in a form
prepared by and acceptable to Agent.

"Multiemployer Plan" means a Plan described in Section 4001(a)(3) of ERISA that
covers employees of either of a Borrower or any ERISA Affiliate.

"New York Mortgage" means each Mortgage that encumbers a Project located in the
State of New York.

"Notes" means the Line of Credit Notes and the Swing Line Note; "Note" means any
of such Notes.

"Notice of Borrowing" means a written notice from a Borrower to Agent, in the
appropriate form that is attached hereto as Exhibit 1.1G, requesting that a Loan
or a Swing Line Loan in a specified amount be advanced to such Borrower on a
specified Funding Date.

"Obligations" means all Indebtedness owing to the Lenders, or any of them, under
this Agreement, the Line of Credit Notes, the Swing Line Note and any Swap
Contract (including, but not limited to, the repayment of the Loans, Letter of
Credit Advances, Swing Line Loans and all interest and other charges due thereon
and hereunder), and all other Loan Documents, including any past, present or
future advances, renewals, extensions, modifications, interest, late charges,
costs and fees of any type.

"Organizational Documents" means, with respect to any entity, its articles of
incorporation, by-laws, partnership agreement, certificate of limited
partnership, limited liability company organization or formation agreement,
limited liability company certificate or articles of formation and trust
indenture, as appropriate to the entity.

"PBGC" means the Pension Benefit Guaranty Corporation or any entity succeeding
to any or all of its functions under ERISA.



                                       10
<PAGE>

"Permitted Debt" means:

(i) the Indebtedness;

(ii) normal operating liabilities such as trade accounts payable, taxes payable,
lease obligations and customer deposits and unsecured notes given as deposits
under agreements of sale for the purchase of land;

(iii) reimbursement obligations under surety bonds, Letters of Credit or
Tri-Party Agreements (whether or not the same have been presented for payment);

(iv) purchase money mortgage loans borrowed from sellers in connection with the
acquisition of land, the outstanding principal amount of which, in the aggregate
at any time, is not greater than $30,000,000, except to the extent that a higher
aggregate principal amount of purchase money loans have been approved by
Requisite Lenders and excluding an approximately $47,000,000 purchase money
mortgage that would encumber the land known as the "Grawton Tract" which has
heretofore been approved by Requisite Lenders, provided, in any event, that all
covenants of Borrower, if any, contained in any purchase money loan document are
less restrictive than the covenants contained in Articles VI, VII and VIII
hereof;

(v) Permitted Subordinated Debt; and

(vi) obligations constituting deposits under agreements of sale for Units.

"Permitted Liens" shall mean:

(i) Liens for taxes, assessments, or similar charges, incurred in the ordinary
course of business and which are not yet due and payable;

(ii) Encumbrances consisting of zoning restrictions, easements or other
restrictions on the use of real property, none of which materially impairs the
use of such property by Borrower in for construction thereon and of Units, and
none of which is violated in any material respect by existing or proposed
structures or land use;

(iii) Liens, security interests or mortgages in favor of Agent for the benefit
of the Lenders;

(iv) Liens on Real Estate that secure purchase money loans made by the sellers
of such Real Estate that are Permitted Debt and which, if encumbering any
Project, are subordinate, in lien, priority and, during the pendency of an Event
of Default, payment of the Mortgage that encumbers such Project; and

(v) Liens shown on title insurance policies accepted by Agent.

"Permitted Subordinated Debt" means unsecured Debt for borrowed money, the
repayment of which by its terms is subordinated to the Indebtedness and which
Debt has been approved by Agent pursuant to Section 7.1 hereof.



                                       11
<PAGE>

"Person" means an individual, partnership, corporation, business trust, joint
stock company, trust, unincorporated association, joint venture, governmental
authority, or other entity of whatever nature.

"Plan" means any plan established, maintained, or to which contributions have
been made by either of the Borrower or any ERISA Affiliate.

"Prescribed Laws" means, collectively, (a) the Uniting and Strengthening America
by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism Act
of 2001 (Public Law 107-56) (The USA PATRIOT ACT), (b) Executive Order No. 13224
on Terrorist Financing, effective September 24, 2001, and relating to Blocking
Property and Prohibiting Transactions With Persons Who Commit, Threaten to
Commit, or Support Terrorism, (c) the International Emergency Economic Power
Act, 50 U.S.C. ss.1701 et. seq. and (d) all other statuteS and laws relating to
money laundering or terrorism.

"Prohibited Transaction" means any transaction set forth in Section 4006 of
ERISA or Section 4975 of the Internal Revenue Code of 1986, as amended from time
to time.

"Project" means, at any time, a tract of Real Estate in an Approved
Jurisdiction, including all Units and/or Improvements constructed or to be
constructed thereon and that is then included in the Borrowing Base Certificate
most recently delivered to Agent and otherwise has satisfied the conditions of
this Agreement for admission to the Borrowing Base.

"Pro Rata Share" means, as to any Lender at any time, the ratio of (i) the
amount of the Commitment of such Lender to (ii) the aggregate Commitment of all
of the Lenders. The Pro Rata Share of each Lender as of the date of this
Agreement is shown on Schedule 1.1B.

"Qualifying Agreement of Sale" means a valid, bona-fide agreement of sale for a
Unit with an unrelated third-party purchaser who is not an Affiliate of
Guarantor or of any Borrower, for fair market value, subject to the following
conditions and limitations:

         (i) provides for a cash deposit of at least 5% of the purchase price,
except that the cash deposit with respect to agreements of sale for Units in the
Richmond, Virginia, MSA may be $1,000 in lieu of 5% of the purchase price; and

         (ii) contains no contingency other than for a mortgage commitment which
does not exceed 95% (97% if the required mortgage is to be FHA-insured) of the
gross sales price of the Unit and which is not contingent upon the sale or lease
of any other real estate (and which contingency provision (unless the subject
Unit is in the Richmond, Virginia, MSA) specifically provides that if the
financing commitment does include such a sale or lease contingency, such
contingency will not affect the purchaser's obligation to close under the
agreement of sale).

         "Raw Land" means land that is neither Approved Land nor Improved Land.

         "Real Estate" means all Approved Land, Development Land and Improved
Land located in an Approved Jurisdiction, fee simple title to which is now or
hereafter owned by a Borrower and upon which it intends to construct (or has
constructed) Improvements and Units.



                                       12
<PAGE>

         "Relevant Accounting Period" means, at any time, the period of four (4)
consecutive Fiscal Quarters, the last of which is the Last Reported Fiscal
Quarter.

         "Reportable Event" means any of the events set forth in Section 4043 of
ERISA.

         "Requisite Lenders" means, at any date, any combination of Lenders
whose Pro Rata Shares aggregate at least sixty-six and two-thirds percent
(66-2/3%).

         "Revolving Sublimit" means $650,000,000.

         "RICO" means the Racketeer Influenced and Corrupt Organization Act, as
amended by the Comprehensive Crime Control Act of 1984, 18 USC ss.ss.1961-68, as
amended from time to time.

         "Swap Contract" means any "swap agreement" (as that term is defined in
11 U.S.C. ss. 101, as heretofore or hereafter amended) entered into with any
individual Lender for the purpose of hedging Borrowers' interest rate risk with
respect to some or all of the Loans.

         "Swing Line Lender" means Wachovia Bank, National Association.

         "Swing Line Limit" means $25,000,000.

         "Swing Line Loan" means a loan made by Swing Line Lender to a Borrower
pursuant to Section 2.1.3.

         "Swing Line Note" means the $25,000,000 promissory note dated the date
hereof, executed by Borrowers in favor of Swing Line Lender to evidence Swing
Line Loans, and any amendments and modifications thereto, any substitutes
therefor, and any replacements, restatements, renewals or extensions thereof, in
whole or in part.

         "Tri-Party Agreement" means (a) an agreement executed by Agent pursuant
to this Agreement, pursuant to which Agent assures to a Governmental Authority
the availability of funds (up to a stated amount) to a Borrower or to such
Governmental Authority for the purpose of completing construction of
Improvements on a Project and (b) each agreement executed by an Issuer for the
foregoing purposes and currently in effect, as identified on Schedule 1.1D
attached hereto.

         "Unit" or "Units" means an attached or detached for-sale single-family
residential housing facility or an individual condominium dwelling.

         "Unused Fee" means the fee payable by Borrowers pursuant to Section
2.6.3.

         1.2 Construction of Terms. Unless the context of this Agreement
otherwise clearly requires, references to the plural include the singular, the
singular the plural and the part the whole and "or" has the inclusive meaning
represented by the phrase "and/or." References in this Agreement to
"determination" by Agent or Lenders include good faith estimates by Agent or
Lenders (in the case of quantitative determinations) and good faith beliefs by
the Agent or Lenders (in the case of qualitative determinations). The words
"hereof," "herein," "hereunder" and similar terms in this Agreement refer to
this Agreement as a whole and not to any particular provision of this Agreement.
The section and other headings contained in this Agreement preceding this
Agreement are for reference purposes only and shall not control or affect the
construction of this Agreement or the interpretation thereof in any respect.
Reference to any Article, Section, Schedule and Exhibit are to this Agreement,
unless otherwise specified. All definitions of, and references to, any Loan
Document mean the Loan Document that is identified herein, as the same may from
time to time be amended in accordance with the provisions of this Agreement and
the subject Loan Document.



                                       13
<PAGE>

         1.3 Accounting Reports and Principles. The character or amount of any
asset, liability, account or reserve and of any item of income or expense to be
determined, and any consolidation or other accounting computation to be made,
and the construction of any definition containing a financial term, pursuant to
this Agreement or any other Loan Document, shall be construed, determined or
made, as the case may be, in accordance with GAAP, consistently applied, unless
such principles are inconsistent with any express provision of this Agreement.

         1.4 Business Day; Time. Whenever any payment or other obligation
hereunder, whether under a Note or under another Loan Document, is due on a day
other than a Business Day, such shall be paid or performed on the Business Day
next following the prescribed due date, except as otherwise specifically
provided for herein to the contrary, and such extension of time shall be
included in the computation of interest and charges. Any reference made herein
or in any other Loan Document to an hour of day shall refer to the then
prevailing Eastern time, unless specifically provided herein to the contrary.

         1.5 Charging Accounts. Whenever Borrowers are obligated, pursuant to
Article II hereof, or pursuant to the Notes or any other Loan Document, to make
payments of any nature to Agent or Lenders, Agent shall be entitled, and each
Borrower, by its execution of the Notes or a Joinder thereto, authorizes Agent,
to draw against any Deposit Account owned by such Borrower at Agent on account
of such fees and expenses or payments due. Agent shall deliver to the subject
Borrower a notice setting forth, in reasonable detail, the amount of the fees,
expenses and/or payments to be satisfied by such draw, and the name or number of
the account or accounts from which the draw was made. Any such charge shall be
subject to the provisions of Section 11.14 hereof relating to the sharing of
recoveries among Lenders.

         1.6 Lenders' Costs. Borrowers shall, upon the request of Agent, pay
Agent the amount of all unpaid Lenders' Costs within fifteen (15) days after
such notice. If not so paid, all past due Lenders' Costs shall be deemed to be
part of the principal balance of the Loans and bear interest at the then
applicable Interest Rate.


                                       14
<PAGE>



                 ARTICLE II. AMOUNT AND TERMS OF THE FACILITY;
                            SECURITY FOR THE FACILITY

         2.1 The Facility.

             2.1.1 Amount and Availability of Line of Credit.

                  2.1.1.1 Provided that no Event of Default has occurred and is
continuing, and subject to the terms and conditions set forth herein, commencing
on the Closing Date and expiring on the Business Day immediately preceding the
Maturity Date, Lenders severally, in accordance with their respective Pro Rata
Shares, shall extend to Borrowers the Line of Credit, pursuant to which each
Lender severally shall make advances of Loans to Borrowers in accordance with
such Lender's Pro Rata Share up to an aggregate for all Lenders of the Revolving
Sublimit, provided that at no time shall Lenders be obligated to make any Loan
if, as a result thereof, (i) the aggregate outstanding principal balance of all
Loans would exceed the then-current Borrowing Base Availability or (ii) the sum
of (x) aggregate outstanding principal balance of all Loans plus (y) the
aggregate maximum liability of Lenders pursuant to then-outstanding Letters of
Credit and Tri-Party Agreements would exceed the Facility Amount. Borrowers may
request Loans for the purpose of financing the acquisition, development and
improvement of Real Estate and the construction thereon of Units and
Improvements, for investment in Joint Ventures (subject to the limitation in
Section 8.4) and for working capital, and for such other appropriate purposes to
which the Requisite Lenders consent (which consent shall not be unreasonably
withheld or delayed). Borrowers may borrow, repay and re-borrow Loans at any
time and from time to time prior to the Maturity Date.

                  2.1.1.2 Master Borrower may, from time to time by written
notice to Agent provided no Event of Default then exists, elect to increase the
Facility Amount and the Revolving Sublimit, by integral multiples of
$10,000,000, to an amount not greater than $750,000,000. Agent shall give
Lenders prompt written notice of each such request made by Master Borrower and
each Lender shall be afforded the opportunity, in its sole discretion, to agree
to increase its Commitment by its then-current Pro-Rata Share of the subject
increase in the Facility Amount by written notice to Agent not later than the
date specified in Agent's Notice. If any Lender does not so elect to increase
its Commitment, the amount of the unallocated increase in the Facility Amount
may be allocated, as Agent, Master Borrower and any other Lender agree, to or
among any other Lenders or, if Master Borrower so desires, to any Eligible
Investor acceptable to Agent in good faith, in which event such Eligible
Investor shall agree in writing to be bound to the terms of this Agreement as a
"Lender" as if such Eligible Investor had been a signatory hereto. Any such
increase in the Facility Amount shall be effected by the then-current Borrowers'
execution of replacement Line of Credit Notes in the aggregate principal amount
of the increased Facility Amount and the modification, if appropriate, of the
Mortgages then in effect, if any. No increase in the Facility Amount shall
result in any increase in the Letter of Credit Sublimit or in the Swing Line
Limit unless specifically agreed in writing by all of the Lenders. No Lender is
obligated by this Section 2.1.1.2 to increase its Commitment.



                                       15
<PAGE>

                  2.1.1.3 Upon (i) the execution by Master Borrower and by an
Eligible Affiliate that is not then a Borrower of a Joinder for each Lender,
(ii) delivery to Agent of such Joinders and of each of the items referred to in
Sections 4.1.4, 4.1.5, 4.1.6 and 4.1.7 that pertains to such Eligible Affiliate,
(iii) execution of each such Joinder by Agent and the appropriate Lender and
(iv) delivery to such Eligible Affiliate of a fully executed Joinder by Agent
and by each Lender, such Eligible Affiliate shall become, and thereafter be for
purposes of this Agreement, a Borrower.

                  2.1.1.4 Master Borrower shall have the right, at any time
after the Closing Date, to terminate, upon not less than thirty (30) days' prior
written notice to Agent, or to reduce, upon not less than three (3) Business
Days' prior written notice to Agent, the Commitments of Lenders regarding the
Facility, provided that the Facility Amount may not be so reduced by Master
Borrower to an amount that is less than the lesser of (i) the sum of the
aggregate principal balance of all Loans and Swing Line Loans then outstanding
plus the aggregate amount of liabilities under all outstanding Letters of Credit
and Tri-Party Agreements or (ii) $150,000,000. Any voluntary termination or
reduction in the Facility Amount shall permanently reduce the Facility Amount.
No such reduction in Facility Amount shall be in an amount less than
$20,000,000. If Borrowers desire to reduce the Facility Amount as aforesaid,
Borrowers shall execute and deliver to Agent such documents and instruments as
Agent shall reasonably require. Each such reduction of the Facility Amount shall
result in a reduction of the Revolving Sublimit in the same amount and in a
proportionate reduction of the Letter of Credit Sublimit.

                  2.1.2 Amount and Availability of Letters of Credit and
Tri-Party Agreements.

         Provided that no Event of Default has occurred and is continuing, and
subject to the terms and conditions set forth herein, Borrowers may request, and
Agent, pursuant to this Section 2.1.2 shall issue or execute on behalf of the
Lenders, (i) Letters of Credit or Tri-Party Agreements to assure Governmental
Authorities of the completion of Improvements that are to be constructed in
Projects and financed with the proceeds of Loans, but only if in each instance
Agent's liability under such Letter of Credit or Tri-Party Agreement is subject
to periodic reduction by the beneficiary thereof as construction of the subject
Improvements is completed, (ii) Letters of Credit to assure Governmental
Authorities that Borrowers will perform their maintenance obligations with
respect to Improvements financed with the proceeds of Loans, (iii) Letters of
Credit that are in lieu of cash deposits under agreements of sale for the
purchase of Real Estate by Borrowers and (iv) Letters of Credit for general
corporate purposes of Borrowers that are necessary to the operation of their
Business. Letters of Credit of the types described in clauses (iii) and (iv) are
sometimes referred to in this Agreement as "FINANCIAL LETTERS OF CREDIT." Each
Letter of Credit identified on Schedule 1.1D also shall be deemed to have been
issued on behalf of the Lenders. No Letter of Credit or Tri-Party Agreement
shall be issued or executed by Agent if, as a result thereof, (x) the aggregate
liability of Agent and all other Issuers under all Letters of Credit and
Tri-Party Agreements then outstanding or in effect would exceed the Letter of
Credit Sublimit or (y) the aggregate liability of Agent under all outstanding
Financial Letters of Credit would exceed $25,000,000.



                                       16
<PAGE>

             2.1.3 Amount and Availability of Swing Line Loans.

         Provided that no Event of Default has occurred and is continuing, and
subject to the terms and conditions set forth herein, commencing on the Closing
Date and expiring on the Business Day immediately preceding the Maturity Date,
Swing Line Lender shall extend to Borrowers' Swing Line Loans up to, in the
aggregate at any time, the Swing Line Limit, provided that at no time shall
Swing Line Lender be obligated to make any Swing Line Loan if, as a result
thereof, the sum of (i) Swing Line Lender's Pro Rata Share of the aggregate
outstanding principal balance of all Loans plus (ii) the outstanding principal
amount of all Swing Line Loans that are not subject to participation with the
other Lenders pursuant to Article XII plus (iii) Swing Line Lender's Pro Rata
Share of all outstanding Letters of Credit and Tri-Party Agreements plus (iv)
Swing Line Lender's Pro Rata Share of the outstanding principal balance of all
Swing Line Loans in which the other Lenders hold a participation interest
pursuant to Article XII would exceed the then-current amount of Swing Line
Lender's Commitment. The Borrowers may request Swing Line Loans for the purpose
of the acquisition of Real Estate and the construction thereon of Units and
Improvements and for working capital. Borrowers may borrow, repay and re-borrow
Swing Line Loans at any time and from time to time prior to the Maturity Date.
If a Swing Line Loan is requested at a time when any Lender is a Defaulting
Lender (as defined in Section 11.13 hereof), the amount of the available Swing
Line Loan shall be reduced by such Defaulting Lender's Pro-Rata Share thereof.

             2.1.4 Letters of Credit and Tri-Party Agreements Generally.

                  2.1.4.1 The terms of all Letters of Credit and Tri-Party
Agreements, and all documents ancillary thereto, shall be subject to Agent's
prior approval.

                  2.1.4.2 At least five (5) Business Days prior to the date any
Borrower desires Agent to issue a Letter of Credit, such Borrower shall deliver
to Agent a completed and executed Application and Agreement for Irrevocable
Standby Letter of Credit (each a "LETTER OF CREDIT APPLICATION") in the form
attached hereto as Exhibit 2.1.4.2.

                  2.1.4.3 No Letter of Credit shall be issued or Tri-Party
Agreement executed or maintained for a term that extends beyond the Maturity
Date (as the same may be postponed pursuant to the terms of this Agreement),
except if all Lenders so agree in their sole discretion.

                  2.1.4.4 Any payment made by any Issuer pursuant to a Letter of
Credit or Tri-Party Agreement shall be deemed to be a Loan (or, as provided in
this Section 2.1.4.4 a Letter of Credit Advance) that was requested by Borrowers
pursuant to Section 2.1.1, notwithstanding that Borrowers did not provide Agent
with a Notice of Borrowing. If the making of a Loan as the result of a drawing
under a Letter of Credit or a demand for payment under a Tri-Party Agreement
would cause the aggregate amount of all outstanding Loans to exceed the
then-current Borrowing Base Availability, the amount of such excess shall be
deemed to be a "LETTER OF CREDIT ADVANCE."


                                       17
<PAGE>

         2.2 Term of Facility.

             2.2.1    Line of Credit.

                  2.2.1.1 The Line of Credit shall terminate on the Maturity
Date, unless renewed or extended by Lenders in writing upon such terms as are
then satisfactory to all Lenders.

                  2.2.1.2 Termination of the Line of Credit shall not in any way
affect or diminish the obligations of the Borrowers to repay any or all of the
Loans or to otherwise comply with all of the terms of this Agreement and all
other Loan Documents.

             2.2.2    Letters of Credit and Tri-Party Agreements.

         The Letter of Credit Sublimit shall terminate on the Maturity Date.
Such termination shall end any obligation of Agent and the Lenders under this
Agreement in regard to the issuance of any new Letters of Credit or execution of
new Tri-Party Agreements, but such termination shall not in any way affect or
diminish the obligations of the Borrowers to repay any or all Advances and
Letter of Credit Advances made on account of a Letter of Credit or Tri-Party
Agreement or to otherwise comply with all of the terms of this Agreement and all
other Loan Documents.

             2.2.3 Swing Line.

         The Swing Line shall terminate on the Maturity Date, unless renewed or
extended by Lenders in writing upon such terms as are then satisfactory to all
Lenders. Termination of the Swing Line shall not in any way affect or diminish
the obligations of the Borrower to repay any or all of the Swing Line Loans or
to otherwise comply with all of the terms of this Agreement and all other Loan
Documents.

         2.3 Repayment Terms.

             2.3.1 Loans.

                  2.3.1.1 The entire outstanding principal balance of all Loans,
together with all accrued interest thereon and other amounts payable by
Borrowers pursuant to this Agreement, shall be due and payable without notice or
demand on the Maturity Date.

                  2.3.1.2 Commencing on February 15, 2006, and continuing on the
15th day of each succeeding month thereafter until to and including the month in
which the Maturity Date occurs, the Borrowers shall pay to the Agent interest at
the applicable Interest Rate, in arrears through (and including) the last day of
the immediately preceding calendar month, on the aggregate outstanding principal
balance of the Loans.

                  2.3.1.3 At any time that the unpaid principal balance of
outstanding Loans shall exceed the Borrowing Base Availability as shown on the
most recently delivered Borrowing Base Certificate, Borrowers (without notice
from Agent or any Lender) shall, within fifteen (15) days after the date the
Borrowing Base Certificate was delivered, either (i) make a principal payment on
account of the Loans in an amount that reduces the outstanding principal balance
of all Loans to such Borrowing Base Availability or (ii) deliver to Agent a new
Borrowing Base Certificate that demonstrates that the then outstanding principal
balance of all Loans does not exceed the Borrowing Base Availability shown on
such new Borrower Base Certificate. The grace period provided in this Section
2.3.1.3 is in lieu of any other notice and grace periods contained in this
Agreement or any other Loan Documents. No new Loans will be advanced at any time
that the aggregate outstanding principal balance of Loans exceeds the
then-current Borrowing Base Availability.


                                       18
<PAGE>

             2.3.2 Letter of Credit Advances.

                  2.3.2.1 Each Letter of Credit Advance must be repaid on the
first to occur of (i) 90 days after the Letter of Credit Advance was made, (ii)
the Maturity Date or (iii) the date when the Borrowing Base Availability next
exceeds the aggregate outstanding principal balance of all Loans (whether as a
result of an increase in Borrowing Base Availability or repayment of a prior
Loan), in which event the outstanding Letter of Credit Advances shall be repaid
with the proceeds of a Loan to the extent then available under the Line of
Credit, such Loan to be applied to outstanding Letter of Credit Advances in the
order in which they were made. Each such Loan, to the extent a new Loan may then
be borrowed pursuant to Section 2.1.1, shall be made automatically by the
Lenders, without receipt of a Notice of Borrowing from Borrowers, and except as
aforesaid no Loan shall be made at a time when any Letter of Credit Advance is
outstanding.

                  2.3.2.2 Letter of Credit Advances shall bear interest at the
applicable Interest Rate and Borrowers shall pay to Lenders, on the 15th day of
each calendar month, accrued interest on all outstanding Letter of Credit
Advances.

             2.3.3    Swing Line Loans.

                  2.3.3.1 The entire outstanding principal balance of each Swing
Line Loan, together with all accrued interest thereon, shall be due and payable
without notice or demand on the third (3rd) Business Day after the Business Day
on which such Swing Line Loan was advanced. If a Swing Line Loan is not paid in
full when due and on such due date the Borrowing Base Availability exceeds the
aggregate outstanding principal amount of all Loans, Lenders shall make a Loan
to Borrowers under the Line of Credit (to the extent available under Section
2.1.1 on the date the Swing Line Loan is due, the proceeds of which shall be
used to repay the Swing Line Loan. Each Loan required to be made pursuant to
this Section 2.3.3.1 to repay a Swing Line Loan shall be made automatically by
Lenders, without a Notice of Borrowing from Borrowers for such Loan. If,
however, the Borrowing Base Availability is not sufficient to permit a Loan to
be made in an amount sufficient to pay the Swing Line Loan in full, each Lender
shall be deemed, automatically and without further action by any Lender, to have
purchased a participation interest in the Swing Line Loan (or the unpaid portion
thereof) as of the due date thereof, as provided (and on the terms and
conditions contained in) Article XII.

                  2.3.3.2 If a Swing Line Loan is not paid in full when
initially due pursuant to Section 2.3.3.1, such Swing Line Loan shall thereafter
be due on the first to occur of (i) the Maturity Date or (ii) the date on which
Borrowing Base Availability next exceeds the aggregate outstanding principal
amount of all Loans, in which event such Swing Line Loan shall be repaid with a
loan to the extent then available under the Line of Credit. Each Loan required
to be made pursuant to this Section 2.3.3.2 to repay a Swing line Loan shall be
made automatically by Lenders, without a Notice of Borrowing from Borrowers.



                                       19
<PAGE>

                  2.3.3.3 If at a time when there are outstanding both Letter of
Credit Advances and Swing Line Loans and Borrower may, pursuant to Section
2.1.1., obtain a Loan under the Line of Credit, the proceeds of such new Loan
shall be applied first as provided in this Section 2.3.3. and then as provided
in Section 2.3.2.

                  2.3.3.4 Swing Line Loans shall bear interest at the applicable
Interest Rate and Borrowers shall pay to Swing Line Lender, on the 15th day of
each calendar month, accrued interest on all outstanding Swing Line Loans.

         2.4 Interest Rate.

             2.4.1 Each Loan, Letter of Credit Advance and Swing Line Loan shall
bear interest at the applicable Interest Rate then in effect. The Interest Rate
shall change (i) automatically from time to time effective as of the effective
date of each change in the LIBOR Market Index Rate or the Applicable Spread, and
(ii) to the extent allowed by law, on the effective date of any change in the
highest lawful rate.

             2.4.2 During the period beginning on the Closing Date until the
first Compliance Certificate is delivered, the Applicable Spread shall be 2.25%
per annum (that is, 225 "basis points"). The Applicable Spread will be adjusted
as of the first Business Day immediately following the date a Compliance
Certificate is delivered to Agent. If a Compliance Certificate is not delivered
when due, then the Applicable Spread (i) shall be adjusted, on the Business Day
on which the Compliance Certificate was due, to 2.25% per annum (that is, 225
"basis points") and (ii) shall continue in effect at that rate until Borrowers
deliver to Agent the delinquent Compliance Certificate, whereupon the Applicable
Spread shall be adjusted, if required, as of the date such Compliance
Certificate is delivered, based on such Compliance Certificate.

             2.4.3 In the event that Agent shall have determined (which
determination shall, absent manifest error, be final, conclusive and binding):

                  2.4.3.1 That adequate and fair means do not exist for
ascertaining the applicable interest rate on the basis provided for in the
definition of the LIBOR Market Index Rate; or

                  2.4.3.2 Requisite Lenders have certified to Agent that such
Lenders shall incur increased costs or reductions in the amounts received or
receivable hereunder in respect of any Loan, in any such case because of (i) any
change in any applicable law or governmental rule, regulation, guideline or
order or any interpretation thereof and including the introduction of any new
law or governmental rule, regulation guideline or order (such as, for example,
but not limited to, a change in official reserve requirements) and/or (ii) other
circumstances which materially and adversely affect such Lenders, the London
Interbank Offering Rate market, or the position of such Lenders in such market;
or

                                       20
<PAGE>
                  2.4.3.3 That the making or continuance by Lenders of Loans
based on the LIBOR Market Index Rate has become unlawful by its compliance in
good faith with any law, governmental rule, regulation, guideline or order
(whether or not having the force of law and whether or not failure to comply
therewith would be unlawful), or has become impracticable as a result of a
contingency occurring which materially and adversely affects Requisite Lenders,
the London Interbank Offering Rate market, or the position of Lenders in such
market; then, and in any such event, Agent shall, promptly after making such
determination, give written notice to Borrowers and each Lender.

         Thereafter, the LIBOR Market Index Rate as the basis for determining
accrued interest on the Indebtedness shall be suspended until such time as Agent
notifies Borrowers and each Lender that the circumstances described in such
clause no longer exist, and until such time interest on the Notes shall, subject
to the other provisions of this Section 2.4, accrue and be payable at a rate
equivalent to a comparable, independently established interest rate index
selected by Agent in good faith, plus the Applicable Spread.

              2.4.4 Interest payable under the Notes shall be calculated on the
basis of a 360 day year but charged for each year or portion thereof that any
Loan, Letter of Credit Advance or Swing Line Loan outstanding.

         2.5 Interest after Maturity. Any principal amount not paid when due (at
the Maturity Date, by acceleration or otherwise) shall bear interest thereafter
until paid in full (before or after judgment), payable on demand, at the Default
Rate.

         2.6 Fees Payable by Borrowers. Borrowers agree to pay to the Agent, for
the account of Lenders, as consideration for the agreement of the Lenders to
make available the Facility, the following Loan Fees:

              2.6.1 Up-Front Fee. On the date of this Agreement, the Borrowers
shall pay an up-front fee in accordance with the Fee Letter dated January 9,
2006 from Wachovia Securities, Inc., and Agent to Guarantor. Such up-front fee
shall be allocated among Agent and the Lenders as provided in such Fee Letter.

              2.6.2 Extension Fees. If Master Borrower requests, pursuant to the
terms of this Agreement, that the Maturity Date be postponed and such request is
approved by the Lenders as provided in Section 2.13, Borrowers shall pay, with
respect to each such extension of the term of the Facility, an extension fee in
an amount that is agreed upon by Master Borrower and Agent prior to October 1st
of the year in which the subject extension is requested. Each such extension fee
shall be allocated to the Lenders (subject to the provisions of Section 2.13) in
accordance with their Pro Rata Shares at the time the postponement of the
Maturity Date is granted and shall be payable by Borrowers within ten (10)
Business Days after the day Master Borrower receives written notice of Lenders'
approval of each such postponement. Master Borrower acknowledges that the
execution of this Agreement constitutes a postponement of the Maturity Date as
set forth in the Original Credit Agreement and shall pay to Lenders an extension
fee in accordance with Section 2.6.2 of the Original Credit Agreement.

                                       21
<PAGE>

              2.6.3 Unused Fee.

                  2.6.3.1 Borrowers shall pay, quarterly in arrears at the time
each Compliance Certificate is due and on the Maturity Date, an Unused Fee at
the rate of 0.25% per annum (that is, 25 "basis points") the average daily
unused portion of the Revolving Sublimit during the Fiscal Quarter most recently
ended.

                  2.6.3.2 The Unused Fee shall be calculated on the basis of a
365 day year. Unused Fees shall be allocated to the Lenders in accordance with
their respective Pro Rata Shares at the time payment of each Unused Fee is due.

              2.6.4 Letters of Credit and Tri-Party Agreement Fee. Borrowers
shall pay quarterly, in arrears on the first (1st) day of each Fiscal Quarter
during such time that any Letter of Credit or Tri-Party Agreement remains
outstanding, a fee based (the "LETTER OF CREDIT FEE") on the amount available to
be drawn under such Letter of Credit or Tri-Party Agreement during the preceding
Fiscal Quarter. Such fee shall be calculated on the basis of a 360 day year (i)
at the per annum rate equal to the Applicable Spread in effect from time to time
during the subject Fiscal Quarter with respect to Financial Letters of Credit
and (ii) at the per annum rate that is 0.25% per annum (that is, 25 "basis
points") less than the Applicable Spread in effect from time to time during the
subject Fiscal Quarter with respect to (a) Letters of Credit that are not
Financial Letters of Credit and (b) Tri-Party Agreements. Each Issuer shall
receive, out of all fees payable by Borrowers under this Section 2.6.4, a Letter
of Credit and Tri-Party Agreement issuance fee calculated at the rate of 0.125%
per annum (that is, 12.5 "basis points") of the amount of such Issuer's
liability under the Letters of Credit and Tri-Party agreements executed by such
Issuer, and the balance of all such fees paid by Borrowers shall be allocated to
the Lenders in accordance with their respective Pro Rate Shares at the time
payment of such fees is due. The provisions of this Section 2.6.4 shall
supersede all agreements heretofore made with regard to fees pertaining to
Letters of Credit and Tri-Party Agreements identified on Schedule 1.1.D between
any Borrower and the Issuers thereof. Borrowers shall also pay to each Issuer,
for its own account, such Issuer's letter of credit issuance, renewal,
amendment, delivery and billing fees that are such Issuer's standard at the time
a Letter of Credit is issued, renewed or amended.

              2.6.5 Additional Loan Fee. If the Facility Amount is at any time
increased pursuant to Section 2.1.1.2, Borrowers shall pay, concurrently with
such increase being effected, an additional fee for the Facility, such fee to be
equal to (a) the up-front fee referred to in the Fee Letter referred to in
Section 2.6.1, calculated as if the up-front fee specified therein had been
based on the newly increased Facility Amount minus (b) the up-front fee paid by
Borrowers pursuant to section 2.6.1 minus (c) the sum of all additional loan
fees theretofore paid by Borrower pursuant to this Section 2.6.5. Such
additional fee shall be allocated among Agent and those Lenders that increase
their respective Commitments in connection with the subject increase of the
Facility Amount, in the proportion that the amount of each Lender's Commitment
increase bears to the amount of the increase of all Commitments.

              2.6.6 Loan Fees Generally. Lenders may, if Borrowers fail to pay
the same when due, disburse to themselves any Loan Fees then due, in whole or in
part, as Loans under the Line of Credit, either on the dates as provided above
or at any time or times thereafter, without the consent of Borrowers and without
receiving a Notice of Borrowing. If any such Loan Fee is so advanced to
themselves by the Lenders from the Line of Credit, interest at the Interest Rate
as provided herein shall begin to accrue upon each portion of the Loan Fees as
so advanced.



                                       22
<PAGE>

         2.7 Prepayments.

              2.7.1 Borrowers may make no more than two (2) payments of
principal of the Indebtedness during any calendar month (provided that payments
of the principal of Letter of Credit Advances and of Swing Line Loans and
payments made by Borrowers pursuant to Section 2.7.2 during any month shall not
be subject to such limit). The acceptance by Lenders of any prepayment when
there is an Event of Default in existence shall not constitute a waiver, release
or accord and satisfaction thereof or of any rights in respect thereto by the
Lenders.

              2.7.2 If a Loan or Swing Line Loan is made or a drawing is made
under any Letter of Credit or Tri-Party Agreement and any Lender fails to
deliver to Agent, as required by the terms of this Agreement, such Lender's Pro
Rata Share of the Loan, Swing Line Loan or Letter of Credit Advance that results
from such drawing and no other Lender or Lenders elect to fund the defaulting
Lender's share, Borrowers shall, within one (1) Business Day after notice from
Agent, pay to Agent the amount of such defaulting Lender's Pro-Rata Share of the
Loan, Swing Line Loan or drawing, which amount, if related to a Letter of Credit
Advance, Agent shall pay over to the issuer of the subject Letter of Credit or
Tri-Party Agreement. No such payment by Borrowers shall be deemed to constitute
a cure of the default by the non-funding Lender of its obligations under this
Agreement.

         2.8 No Setoff or Deduction. All payments of principal and interest on
the Loans, Letter of Credit Advances, Swing Loans and other amounts payable by
the Borrowers hereunder shall be made by the Borrowers without setoff or
counterclaim, and free and clear of, and without deduction or withholding for,
or on account of, any present or future taxes or assessments imposed by any
governmental authority, or by any department agency or other political
subdivision or taxing authority.

         2.9 Illegality. Notwithstanding any other provision in this Agreement,
if Agent determines that any applicable law, rule, or regulation, or any change
therein, or any change in the interpretation or administration thereof by any
governmental authority, central bank, or comparable agency charged with the
interpretation or administration thereof, or compliance by the Lenders with any
request or directive (whether or not having the force of law) of any such
authority, central bank, or comparable agency shall make it unlawful or
impossible for the Lenders to maintain the Facility, then upon notice to the
Borrowers and Lenders by the Agent the Facility shall terminate and Borrowers
shall immediately repay all Indebtedness.

         2.10 Notes.

              2.10.1 The obligation of Borrowers to repay all Loans and all
Letter of Credit Advances, and all interest and other charges thereon, shall be
evidenced by the Line of Credit Notes. Borrowers shall execute and deliver to
each Lender one Line of Credit Note in the principal amount of such Lender's
Commitment.



                                       23
<PAGE>

              2.10.2 The obligation of Borrowers to repay all Swing Line Loans,
and all interest thereon, shall be evidenced by the Swing Line Note. Borrowers
shall execute and deliver to Swing Line Lender the Swing Line Note.

         2.11 Security.

              2.11.1 Borrowers shall deliver to Agent, as security for the
Obligations:

                  2.11.1.1 An unlimited suretyship agreement of Guarantor, which
shall guaranty payment and not merely collection, of the Indebtedness now or
hereafter owing by Borrowers to the Lenders as provided herein and the prompt
performance of all obligations under the Loan Documents.

                  2.11.1.2 A first priority Mortgage lien on all Projects that,
subject to the provisions of Section 2.11.2, are at any time included in the
Borrowing Base.

              2.11.2 If (i) the Leverage Ratio is less than 2.00:1 as shown
on the Financial Statements provided with respect to two (2) consecutive Fiscal
Quarters, (ii) Master Borrower delivers to Agent, prior to the expiration of the
Fiscal Quarter that next follows the second of such two (2) Fiscal Quarters,
written notice requesting the release by Agent of all Collateral (but not
including the Guaranty) and (iii) at the time Agent receives such request (the
"COLLATERAL RELEASE DATE") there exists no Event of Default or any fact or
circumstance that, but for delivery of notice or passage of time (or both) would
constitute an Event of Default, Agent shall promptly deliver to Master Borrower
such release of liens, satisfaction pieces or other instruments that are
appropriate to cause all Mortgages then held by Agent to be satisfied of record.
The cost of preparation of such instruments shall be Lenders' Costs and
Borrowers shall be responsible to affect the proper recording of such
instruments.

              2.11.3 Prior to the Collateral Release Date, individual Lots and
the Units thereon shall be released by Agent from the lien of the applicable
Mortgage, without payment on account of the principal of the Indebtedness,
promptly after receipt of written request therefore, provided (i) that (a) each
such release is in connection with the conveyance of such Lot and Unit in the
ordinary course of the Borrower's Business or (b) if a requested release
involves Lots and Units that have an Appraised Value or Cost Incurred of
$5,000,000 or more, such request must be accompanied by a new, current Borrowing
Base Certificate evidencing that immediately after such release Borrowers would
be in compliance with the terms of this Agreement (and, if not, by a payment of
principal in an amount sufficient to cause Borrowers to be in compliance) and,
(ii) in connection with any requested release, there then exists no continuing
Event of Default. To facilitate the conveyance of Units in the ordinary course
of any Borrower's Business, the title insurer involved in such transaction may,
by an e-mail addressed to refs_orleans@wachovia.com, request confirmation that
the subject Lot and Unit will be so released by Agent and, if such is the case,
Agent shall promptly respond to such inquiry by e-mail.



                                       24
<PAGE>

         2.12 General Provisions.

              2.12.1 Advances. Advances of Loans and Letter of Credit Advances
shall be made by Lenders simultaneously and proportionately to their Pro Rata
Shares, it being understood that the obligations of Lenders to advance funds to
Borrowers hereunder are several and independent and that no Lender shall be
responsible for any default by any other Lender in that other Lender's
obligation to make any such advance, nor shall the Commitment of any other
Lender be increased or decreased as a result of the default of any other Lender
in that other Lender's obligation to make advances hereunder. Borrowers may
request no more than two (2) Advances of Loans under the Line of Credit during
any calendar month (which shall be in addition to Letter of Credit Advances and
Swing Line Loans and shall exclude Loans made automatically as aforesaid to
repay Letter of Credit Advances and Swing Line Loans).

              2.12.2 Notice of Borrowing. Subject to the provisions of this
Article II, whenever a Borrower desires to borrow a Loan under this Agreement,
such Borrower shall deliver by telecopy to Agent a properly completed Notice of
Borrowing, executed by an Authorized Signer, no later than 11:00 A.M. at least
two (2) Business Days in advance of the proposed Funding Date. The Notice of
Borrowing shall specify (i) the proposed Funding Date (which shall be a Business
Day) and (ii) the amount of the proposed Loan. Loans shall be in integral
multiples of $500,000 but may not be in an amount less than $500,000. Each
Notice of Borrowing shall be delivered to Agent at 201 S. College Street, 8th
Floor, Charlotte, NC 28288-5708, Attention: Syndication Agency Services,
facsimile 704-383-7989, with a copy to Agent at 123 S. Broad Street,
Philadelphia, Pennsylvania 19109, Attention: Julie Pasceri-Young, facsimile
215-670-6530 (or to such other addresses or facsimile numbers as Agent may from
time-to-time advise Borrowers by written notice).

              2.12.3 Funding of Loans.

                  2.12.3.1 By 3:00 P.M. on the day Agent (i) receives a Notice
of Borrowing pursuant to Section 2.12.2 or (ii) has actual knowledge that a
drawing or a demand for payment has been or will be made under a Letter of
Credit or Tri-Party Agreement, Agent shall notify each Lender by facsimile or
electronic (e-mail) transmission of the proposed borrowing, drawing or demand.
Except as provided in Section 2.12.3.2, not later than noon on the Funding Date
specified in the Notice of Borrowing (or the anticipated date of the honoring of
any such drawing or demand, as specified in Agent's notice to the Lenders), each
Lender shall wire transfer to such account of Agent as Agent shall designate an
amount in immediately available funds equal to the amount of each Lender's Pro
Rata Share of the Loan or Letter of Credit Advance to be made to or for the
account of Borrowers on such Funding Date. Agent shall cause such Loans to be
made available to the requesting Borrower on the Funding Date pertaining thereto
by depositing the amount thereof in the designated account of such Borrower with
Agent.

                  2.12.3.2 Each Lender shall make the amount of its Pro Rata
Share of the Loan or Letter of Credit Advance available to Agent, in same day
funds, not later than noon on the Funding Date, by wire transfer to Syndication
Agency Services, 201 S. College Street, Charlotte, North Carolina, ABA #053 000
219, Account #5000000061196, Ref. Orleans Homebuilders, Inc. (or to such other
account as Agent may from time to time advise the Lenders by written notice).
Unless Agent shall have been notified by any Lender prior to any Funding Date in
respect of any requested Loan that such Lender does not intend to make available
to Agent such Lender's Pro Rata Share of the requested Loan on such Funding
Date, Agent may assume that such Lender has made such amount available to the
requesting Borrower on such Funding Date and Agent in its sole discretion may,
but shall not be obligated to, make available to the requesting Borrower a
corresponding amount on such Funding Date by depositing the proceeds thereof in
the designated Deposit Account of the requesting Borrower with Agent. If any
Lender's Pro Rata Share of any Loan is not in fact made available (either by a


                                       25
<PAGE>

wire transfer to Agent or otherwise) to Agent by such Lender, Agent shall not be
required to advance to the requesting Borrower on the Funding Date any amount
not made available to Agent by a Lender; provided, that if Agent (or any other
Lender(s)) advances to or for the account of such Borrower on the Funding Date,
or honors a drawing or demand made under a Letter of Credit or Tri-Party
Agreement, any amount not made available to Agent by a Lender, Agent (or such
Lender) shall notify Borrowers that Agent (or such Lender) has advanced more
than its Pro Rata Share of such Loan or Letter of Credit Advance and that such
Loan or Letter of Credit Advance is subject to reclamation in accordance with
the provisions of this Section. Any amount so advanced shall be deemed to be a
Loan or Letter of Credit Advance which Borrowers are obligated to repay as set
forth under this Agreement and Agent shall be entitled to recover such
corresponding amount on demand from such Lender, in accordance with the
provisions of Section 11.13. If such Lender does not pay such corresponding
amount forthwith upon the Agent's demand therefor, Agent shall promptly notify
Borrowers and Borrowers shall immediately pay such corresponding amount to the
Agent, together with interest at the Interest Rate.

              2.12.4 Swing Line Loans. Borrowers may request a Swing Line Loan
by delivering to Agent an appropriate Notice of Borrowing not later than 2:00
P.M. on any Business Day. Swing Line Loans must be in an integral multiple of
$100,000, but in no event less than $500,000. Swing Line Lender will fund Swing
Line Loans on the Business Day on which a Notice of Borrowing with respect
thereto is received by depositing the amount thereof into the designated account
of the requesting Borrower with Agent.

              2.12.5 Manner, Time and Application of Payment. All payments of
principal, interest and fees hereunder and under the Notes shall be made by
Borrowers without notice, set-off or counterclaim and in immediately available
same day funds and delivered to Agent not later than 1:00 P.M., on the date due
for the account of Lenders; funds received by Agent after that time shall be
deemed to have been paid by Borrowers on the next succeeding Business Day. All
such payments shall be made by wire transfer to the account identified in
Section 2.12.3.2, or to such other account as Agent may from time to time
specify by written notice to Borrowers. Payments received for the account of
Lenders shall be applied first, on account of accrued interest and then on
account of outstanding principal.

              2.12.6 Apportionment of Payments. Aggregate principal and interest
payments made by Borrowers in respect of Loans and Letter of Credit Advances
(but not of Swing Line Loans, which shall be the subject of Article XII) shall
be apportioned proportionately to each Lender's respective Pro Rata Share. Agent
shall, within one (1) Business Day, distribute to each Lender its share of all
payments received by Agent for the benefit of Lenders, and if any such payment
is not so distributed, Agent shall pay to the intended recipient thereof
interest on the unpaid amount thereof at the Federal Funds rate until paid.
Prior to the participation of Lenders in a Swing Line Loan pursuant to Article
XII, all payments on account of such Swing Line Loan shall be distributed only
to Swing Line Lender.

              2.12.7 Conditional Payment. Borrowers agree that checks and other
instruments received by Agent on behalf of Lenders or by any Lender in payment
or on account of the Indebtedness constitute only conditional payment until such
items are actually paid to Agent or such Lender.



                                       26
<PAGE>

              2.12.8 Advances Attributable to New York Projects. Following the
recording of a Mortgage that encumbers a Project in the State of New York (each
a "NEW YORK MORTGAGE") the amount of each Advance thereafter made (but only
until the aggregate amount of such Advances equals the "SECURED AMOUNT" (as
defined in such Mortgage) shall be deemed to have been advanced under, and
secured by, such New York Mortgage. The portion of the Indebtedness secured by
such New York Mortgage shall be reduced only by the last and final sums that
Borrowers repay with respect to the Indebtedness (as provided in this Section
2.12.8) and, from and after that date on which the aggregate amount of such
Advances equals the Secured Amount, the portion of the Indebtedness secured by
such New York Mortgage shall not be reduced by any intervening repayments of the
Indebtedness by Borrowers. So long as the outstanding balance of the
Indebtedness exceeds the Secured Amount of a New York Mortgage, any payments and
repayments of the Indebtedness shall not be deemed applied against, or to
reduce, the portion of the Indebtedness secured by such New York Mortgage and
such payments shall be deemed to reduce only such portions of the Indebtedness
as are secured by Mortgages encumbering real property located outside of the
State of New York, except as provided in the next sentence of this Section
2.12.8. If at any time when more than one New York Mortgage is in effect a
payment of the Indebtedness is made such that the outstanding principal amount
of the Indebtedness would be less than the Secured Amount of any New York
Mortgage, the amount of such payment shall be deemed applied in reduction of the
Secured Amount of such New York Mortgage as shall be specified by Agent by
written notice to Master Borrower.

         2.13 Postponement of Maturity Date.

              2.13.1 Master Borrower may, by written notice to Agent not earlier
than August 1st of any year nor later than October 1st of such year, request
that Lenders postpone the Maturity Date for one (1) year (each an "EXTENSION
REQUEST"). Agent shall promptly notify Lenders of each such request. Agent shall
advise Master Borrower in writing, not later than January 15th of the year
following the year in which such postponement request was received, whether
Lenders have agreed, in accordance with Section 11.10, so to postpone the
Maturity Date, but if Master Borrower fails to receive written notice from Agent
acknowledging the postponement of the Maturity Date, the Extension Request shall
be deemed to have been denied.

              2.13.2 If Agent receives the written approval of the Extension
Request by Lenders whose Pro Rata Shares equal or exceed 66-2/3% in the
aggregate, but not by all Lenders, and provided no default or Event of Default
exists on the Maturity Date, the Maturity Date, if Master Borrower so agrees by
giving written notice to Agent within five (5) Business Days after receipt of
Agent's notice, shall be extended as specified in the Extension Request but only
with respect to Lenders that have given their written approval thereof. If the
Maturity Date is so extended, Borrowers shall pay to the Lenders approving the
extension an extension fee as provided in Section 2.6.2. Except to the extent
that a Lender that did not give its written approval to such Extension Request
("REJECTING LENDER") is replaced as provided in Section 13.9.6 hereof, the Loans
and all interest thereon, fees and other Obligations owed to such Rejecting
Lender shall be paid in full on the Maturity Date as determined prior to such
Extension Request (the "REJECTING LENDER'S FACILITY TERMINATION DATE").



                                       27
<PAGE>

              2.13.3 If Lenders whose Pro Rata Shares equal or exceed 66-2/3% in
the aggregate approve the Extension Request, Borrowers, upon notice to Agent and
any Rejecting Lender, may terminate the Commitment of such Rejecting Lender (or
such portion of such Commitment that is not assigned to a Replacement Lender in
accordance with Section 13.9.6 hereof) by written notice to Agent and the
Rejecting Lender, which termination shall occur as of a date set forth in Master
Borrower's notice but in no event fewer than ten (10) nor more than thirty (30)
days following such notice. The termination of a Lender's Commitment shall be
effected in accordance with Section 2.13.4 hereof.

              2.13.4 If Master Borrower elects to terminate the Commitment of a
Rejecting Lender as provided in Section 2.13.3, Borrowers shall pay to the
Rejecting Lender all Obligations due and owing to it hereunder or under any
other Loan Document, including, without limitation, the aggregate outstanding
principal amount of the Loans owed to such Rejecting Lender, together with
accrued interest thereon through the effective date of such termination, and the
Unused Fee and Letter of Credit Fee payable to such Rejecting Lender through the
effective date of such termination. Upon request by Master Borrower or Agent,
the Rejecting Lender will deliver to Master Borrower and Agent a letter setting
forth the amounts payable to such Rejecting Lender as set forth above. Upon the
termination of such Rejecting Lender's Commitment and payment of the amounts
provided for in the immediately preceding sentence, Borrowers shall have no
further obligations to such Rejecting Lender under this Agreement and such
Rejecting Lender shall cease to be a Lender, provided, however, that such
Rejecting Lender shall continue to be entitled to the benefits of Sections
13.15, 13.22 and 13.23 hereof. Upon the effective date of the termination of the
Rejecting Lender's Commitment, the Facility Amount and the Revolving Sublimit
shall be reduced by the amount of the terminated Commitment of the Rejecting
Lender and the Letter of Credit Sublimit shall be reduced proportionately.
Notwithstanding the foregoing, if, upon the termination of the Commitment of
such Rejecting Lender, the sum of the outstanding principal balance of the
Loans, Swing Line Loans, Letters of Credit and Tri-Party Agreements would exceed
the Facility Amount (as so reduced), Master Borrower may not terminate such
Rejecting Lender's Commitment unless Borrowers, on or prior to the effective
date of such termination, prepay, in accordance with the provisions of this
Agreement, outstanding Loans or cause to be canceled, released and returned to
Agent outstanding Letters of Credit or deposit cash with Agent in sufficient
amounts in the aggregate such that, on the effective date of such termination,
the sum of the outstanding Loans, Swing Line Loans, Letters of Credit and
Tri-Party Agreement less the amount of any such cash deposit does not exceed the
Facility Amount or Letter of Credit Sublimit, as the case may be (as reduced).
In the event that Borrowers make such cash deposit with Agent, such deposit
shall be applied by Agent to pay all Letter of Credit Advances that are not
reimbursed by Borrowers and, provided no default or Event of Default has
occurred that is continuing, shall be returned to Borrowers when the sum of the
outstanding Loans, Swing Line Loans, Letters of Credit and Tri-Party Agreement
equals or is less than the Facility Amount and Letter of Credit Sublimit, as
applicable.

         2.14 Swap Contracts. In the event that any Borrower enters into any
Swap Contract and Borrower elects, by written notice to Agent within five (5)
Business Days execution of the Swap Contract, that amounts owed by such Borrower
under such Swap Contract shall be Indebtedness, such Swap Contract shall be
secured by the Mortgages and all amounts owed by Borrowers under such Swap
Contracts (including, without limitation, all termination payments, if any)
shall be secured by, and paid out of, the Collateral "pari passu" with the other
Indebtedness.



                                       28
<PAGE>

               ARTICLE III. NOTICE OF BORROWING; BORROWING BASE;
                           BORROWING BASE AVAILABILITY

         3.1 Notice of Borrowing.

              3.1.1 Request for Advances under Line of Credit and Swing Line.
Borrowers shall give Agent written notice (effective upon receipt) of a
Borrower's request for advances under the Line of Credit or Swing Line by
delivering to Agent a fully completed Notice of Borrowing as provided in Section
2.12.2 or Section 2.12.4, as appropriate.

              3.1.2 Request for Letters of Credit and Tri-Party Agreements.
Borrowers shall give Agent written notice (effective upon receipt) of a
Borrower's request for issuance of a Letter of Credit or execution of a
Tri-Party Agreement hereunder, specifying the purpose of the Letter of Credit or
Tri-Party Agreement, the amount thereof and the date such Borrower desires it be
issued or executed. Each such request shall be delivered to Agent only at
Agent's Philadelphia, Pennsylvania office, as identified in Section 13.10 (or to
such other address as Agent may from time-to-time advise Master Borrower by
written notice), accompanied by a draft of the proposed Letter of Credit or
Tri-Party Agreement (which must be acceptable to Agent in good faith) and the
other documents required pursuant to Section 4.2.3 and shall be delivered to
Agent at least five (5) Business Days in advance of the date Borrower desires
the Letter of Credit or Tri-Party Agreement to be issued or executed, but Agent
shall endeavor to cause Letters of Credit and Tri-Party Agreements to be issued
within three (3) Business Days after receipt of a Borrower's request therefor.
Each Letter of Credit or Tri-Party Agreement shall be subject to the limitations
as provided in this Agreement.

         3.2 Admission of Projects to Borrowing Base.

              3.2.1 The Projects identified on the Borrowing Base Certificate
delivered to Agent concurrently with the execution of this Agreement shall
constitute the Projects that comprise the Borrowing Base as of the date hereof.

              3.2.2 Projects shall from time to time be admitted to the
Borrowing Base, provided that the fee owner of such Project, at the time the
Project is so admitted, either is an existing Borrower or concurrently therewith
becomes a Borrower. Prior to the Collateral Release Date, Master Borrower shall
give Agent written notice that Master Borrower desires that a Project be added
to the Borrowing Base, such notice to be delivered to Agent sixty (60) days
prior to the desired admission date. Prior to the Collateral Release Date,
Borrowers shall, also, before any Project is deemed admitted to the Borrowing
Base, deliver to Agent with respect to such Project the documents set forth in
Section 4.1.10. The items referred to in Sections 4.1.10.5, 4.1.10.7, 4.1.10.9,
4.1.10.10 and 4.1.10.11 and a commitment for a policy of title insurance with
respect to the subject Project to be delivered to Agent at least 20 calendar
days before the date that Borrowers desire such Project be admitted to the
Borrowing Base.



                                       29
<PAGE>

         3.3 Borrowing Base Availability.

              3.3.1 The aggregate amount of Loans that may be outstanding at any
time shall not exceed the lesser of (i) the then-current Borrowing Base
Availability or (ii) the Revolving Sublimit. Borrowing Base Availability shall
be determined at any time on the basis of the Borrowing Base Certificate most
recently delivered to Agent, by applying to each of the following classes of
assets of Borrowers the applicable "Advance Rate," determined in accordance with
Section 3.3.2:
<TABLE>
<CAPTION>
         <S>       <C>                                                            <C>            <C>

                   Asset Class                                                  LTV Advance     LTC Advance
                                                                                Rate(1)         Rate
         (i)       Units subject to a Qualifying Agreement of Sale              85%             95%(2)
         (ii)      Units not subject to a Qualifying Agreement of Sale          80%             80%
         (iii)     Lots part of Improved Land and not subject to a Qualifying   75%             75%
                   Agreement of Sale
         (iv)      Lots part of Development Land                                75%             75%(3)
         (v)       Lots part of Approved Land                                   50%             50%
</TABLE>

                  (1) The LTV Advance Rate shall not be applicable after the
Collateral Release Date.

                  (2) The LTC Advance Rate for Units subject to a Qualifying
Agreement of Sale shall be reduced to 90% on the Collateral Release Date.

                  (3) The LTV and LTC Advance Rates for Lots part of Development
Land shall be reduced to 70% on the Collateral Release
Date.

              3.3.2 The maximum aggregate amount of Borrowing Base Availability
attributable to each of the asset classes identified in Section 3.3.1 on any
Borrowing Base Certificate (each an "ASSET CLASS") shall be determined as
follows:

                  3.3.2.1 For Asset Classes (i) and (ii), the least of (a) the
applicable LTV Advance Rate multiplied by the most recently determined Appraised
Value of the subject Unit, (b) the applicable LTV Advance Rate multiplied by the
price set forth in the Qualifying Agreement of Sale, if any, to which the Unit
is subject and (c) the applicable LTC Advance Rate multiplied by the Cost
Incurred with respect to such Unit.

                  3.3.2.2 For Asset Classes (iii) and (iv), the lesser of (a)
the applicable LTV Advance Rate multiplied by the most recently determined
Appraised Value of the subject Lot and (b) the applicable LTC Advance Rate
multiplied by the Cost Incurred with respect to such Lot.

                  3.3.2.3 For Asset Class (v), the lesser of (a) the applicable
LTV Advance Rate multiplied by the most recently determined Appraised Value of
the subject Lot and (b) the applicable LTC Advance Rate multiplied by the Cost
Incurred with respect to such Lot.

                  3.3.2.4 On any Borrowing Base Certificate, (a) the maximum
aggregate Borrowing Base Availability attributable to Asset Classes (iii), (iv)
and (v) shall not exceed (I) 55% of the total Borrowing Base Availability as
shown thereon if submitted prior to the Collateral Release, or (II) 45% of the
total Borrowing Base Availability shown thereon if submitted after Collateral
Release Date, (b) the maximum Borrowing Base Availability attributable to Asset
Class (v) shall not exceed 10% of the total Borrowing Base Availability as shown
thereon, and (c) the maximum Borrowing Base Availability attributable to Asset
Class (ii) (including models) shall not exceed 30% of the aggregate Borrowing
Base Availability attributable to Asset Classes (i) and (ii) as shown thereon.

                                       30
<PAGE>

                  3.3.2.5 Once a Lot is the subject of a Qualifying Agreement of
Sale, the land value of such Lot shall be transferred to Asset Class (i) and
once vertical construction of a Unit is commenced on any Lot, the land value of
such Lot shall (if not theretofore pursuant to this Section 3.3.2.5) be
transferred from Asset Class (iii) or (iv) to Asset Class (i) or (ii), as
appropriate.

                  3.3.2.6 Borrowers acknowledge that the Agent may make changes
or adjustments to the values set forth in any Appraisal as may be required by
the Agent's appraisal department in the exercise of its good faith business
judgment, and that the Agent is not bound by the value set forth in any
Appraisal performed pursuant to this Agreement and does not make any
representations or warranties with respect to any Appraisal. Borrowers further
agree that Lenders shall have no liability as a result of or in connection with
any such Appraisal for statements contained in such Appraisal, including without
limitation, the accuracy and completeness of information, estimates, conclusions
and opinions contained in such Appraisal, or variance of such Appraisal from the
fair value.

                  3.3.2.7 Re-Appraisals. Agent, at its discretion, shall have
the right to obtain new Appraisals of all or any portion of the Projects (a)
whenever an Event of Default has occurred and is continuing, (b) as required by
the then current regulatory requirements generally applicable to real estate
loans of the categories made under this Agreement, as reasonably interpreted by
the Agent, (c) at any time following a condemnation of more than an immaterial
portion of a Project, as determined in good faith by the Agent and (d) upon any
material adverse change with respect to a Project, as determined in good faith
by the Agent.

                  3.3.2.8 Specific Jurisdictions.

                           (i) Generally. The amount of Borrowing Base
Availability attributable to Projects in any Approved Jurisdiction in which the
liens of Mortgages are limited to a stated amount that is less than the Facility
Amount shall at no time exceed such stated amount (which shall not be an
aggregate amount) contained in each of the then-outstanding Mortgages in such
Approved Jurisdiction (that is, for example, if there are five (5) Mortgages
encumbering Projects in Florida, each with a stated principal amount of
$75,000,000, the maximum Borrowing Base Availability, at any time, on account of
Florida Projects would be $75,000,000).

                           (ii) New York. The amount of Borrowing Base
Availability attributable to any Project in the State of New York shall at no
time exceed the stated amount of the Mortgage that encumbers such Project.

                                       31
<PAGE>

                  3.3.2.9 Purchase Money Mortgages. The aggregate amount of
Borrowing Base Availability shall at all times be reduced by the
then-outstanding aggregate principal balance of all purchase money mortgages
encumbering Projects that are Permitted Liens and that do not secure the
Indebtedness.

         3.4 Submission of Borrowing Base Certificate. In addition to any other
requirement to do so as provided in this Agreement, (i) Borrowers shall submit
to Agent a current Borrowing Base Certificate by the fifteenth (15th) day of
each calendar month, and (ii) may submit a total of two (2) Borrowing Base
Certificates during any calendar month, in each instance accompanied by such
additional supporting information as may be reasonably requested by Agent. Any
such Borrowing Base Certificate delivered to Agent shall be deemed certified by
Borrowers as to its completeness and its accuracy (including, prior to the
Collateral Release Date, that each Lot and Unit identified thereon are
encumbered by a Mortgage). If approved by Agent, such Borrowing Base Certificate
shall be determinative of the then-current Borrowing Base Availability.

         3.5 Inspection of Projects. Borrowers shall permit Agent, by its
employees and independent contractors, to enter upon and inspect, at any time
and from time to time, all Projects that are then in the Borrowing Base, such
inspections shall be made at a pace such that approximately 25% of all Projects
in the Borrowing Base are so inspected during each Fiscal Quarter. The costs of
such inspections, as reasonably agreed upon by Master Borrower and Agent at the
time a Project is admitted to the Borrowing Base, shall be Lender's Costs.

                       ARTICLE IV. CONDITIONS OF LENDING

         4.1 Agreement to Make Available the Facility. The agreement of Agent
and Lenders to enter into this Agreement is subject to the conditions precedent
that Agent and Lenders shall have received (or, at Requisite Lenders' sole
discretion with respect to any of the Section 4.1.10 requirements as they
pertain to a Project or Projects, waived) on or before the date hereof (which
may include, Agent's discretion, documents delivered in connection with the
Original Credit Facility) all of the following collateral documents, each in
form and substance satisfactory to the Agent:

              4.1.1 The Line of Credit Notes, duly executed by the Master
Borrower and by each other Borrower.

              4.1.2 The Guaranty, duly executed by Guarantor in favor of Agent
for the ratable benefit of the Lenders.

              4.1.3 The Swing Line Note, duly executed by the Master Borrower
and by each other Borrower.

              4.1.4 Certified copies of all corporate, limited partnership and
limited liability company action (as appropriate) taken by Borrowers and
Guarantor, including resolutions of their respective Boards of Directors,
authorizing the execution, delivery and performance of the Loan Documents to
which each is a party.

              4.1.5 An incumbency and signature certificate (dated as the date
of this Agreement) of the Secretaries, general partners or members (as
appropriate) of each Borrower and Guarantor, certifying the names and true
signatures of the officers or other authorized Persons of Borrower and Guarantor
authorized to sign the Loan Documents to which it is a party.



                                       32
<PAGE>

              4.1.6 A copy of the Organizational Documents of each Borrower and
Guarantor, certified as true and correct by its respective Secretary, general
partner or members.

              4.1.7 A Subsistence Certificate for each Borrower and Guarantor,
issued within thirty (30) days prior to the date hereof, from the state of such
entity's formation and all jurisdictions in which such Borrower or Guarantor is
required to register as a foreign corporation, limited partnership or limited
liability company.

              4.1.8 An Opinion directed to Agent and the Lenders and issued by
the counsel to the Borrowers and Guarantor (who must be an independent
attorney-at-law licensed to practice in Pennsylvania) that (i) Borrowers and
Guarantor are duly organized, validly existing, and in good standing in the
state of such entity's formation and the Borrowers are authorized to do business
in all jurisdictions where such authorization is required, (ii) each Borrower
and Guarantor has the power to enter into the transactions contemplated by this
Agreement and by the Loan Documents; (iii) the transactions contemplated by this
Agreement and the Loan Documents do not violate any provision of any
Organizational Document, or any other document known to such counsel, affecting
any Borrower or Guarantor; (iv) the Loan Documents have been executed and
delivered by, and constitute the valid and binding obligations of, Borrowers and
Guarantor (to the extent executed thereby), enforceable in accordance with their
terms, except as limited by applicable bankruptcy or other laws affecting
creditor's rights generally; (v) the Facility and the repayment of the
Indebtedness in accordance with the terms of this Agreement, the Line of Credit
Notes and the Swing Line Note shall not violate any applicable usury laws; and
(vi) such other matters relating to the transactions contemplated herein as
Agent or Agent's counsel may reasonably request.

              4.1.9 The most recent Financial Statements of Guarantor.

              4.1.10 With respect to each Project that is included in the
Borrowing Base; Borrowers shall deliver to Agent (or, if required by any
applicable rule or regulation by which Lenders are governed, Agent shall obtain)
each of the following:

                  4.1.10.1 A Mortgage, for the ratable benefit of the Lenders,
for such Project, executed and acknowledged by the Borrower that is the owner
thereof, which shall be a first lien (subject only to Permitted Liens) on the
Project in the Facility Amount, plus any interest and other charges due thereon;
except that if the Project is located in Florida, New York, Virginia or another
Approved Jurisdiction that imposes taxes upon the recording of, or requires
documentary stamps to be affixed to, Mortgages, the amount of the Mortgages in
such Approval Jurisdictions may be limited in amount as from time to time
designated by Master Borrower and approved by Agent, and such Mortgages may be
effected by the subject Borrower and Agent executing a mortgage modification,
spreader and reaffirmation agreement, in form acceptable to Agent, whereby the
lien of an existing Mortgage is spread to encumber such Project.



                                       33
<PAGE>

                  4.1.10.2 A collateral assignment to Agent, for the ratable
benefit of the Lenders, of all Governmental Approvals (to the extent
assignable), contracts and agreements to which the Project is subject, in form
acceptable to Agent in good faith, executed by the Borrower that is the owner of
such Project.

                  4.1.10.3 Evidence as required by applicable banking
regulations that no part of the Project on which any Unit is to be constructed
is located in a flood plain or, if such evidence is not provided, a policy and
certificate of flood insurance covering the Project, naming the Agent as
insured.

                  4.1.10.4 A marked-up title commitment of First American Title
Insurance Company or another title insurance company satisfactory to the Agent,
representing the title insurance company's commitment to issue in favor of the
Agent, for the ratable benefit of the Lenders, but at the Borrower's expense, a
standard form of mortgagee title insurance policy, insuring the Mortgage on the
Project, in an amount determined by Borrowers and Agent in good faith, as a
first lien on the Real Estate included in the Project, free and clear of all
prior Liens and encumbrances (other than Liens and encumbrances in favor of the
Agent), subject only to such title conditions and Permitted Liens as may have
been approved by the Agent. The title commitment shall also provide that the
policy of title insurance such include such endorsements or additional coverage
as determined by Agent to be necessary (which may include (if available)
Pennsylvania Endorsements 100, 300, 710, 1010 and 1110 or their equivalents from
other jurisdictions).

                  4.1.10.5 If requested by Agent, copies of any subdivision or
land development plans applicable to such Project, evidence of the final
approval of such plans and, if the recording of such plan has not been
demonstrated to Agent, evidence reasonably acceptable to Agent that such plans
will be recorded promptly upon the delivery of any required Letter of Credit or
Tri-Party Agreement, and in any event not later than 60 days after the later of
(i) admission of the Project into the Borrowing Base or (ii) the Borrower's,
with respect to Projects admitted to the Borrowing Base after the Closing Date,
receipt of all state- or federally-issued Governmental Approvals that are
prerequisite to the recording of the plans, but in the latter event no more than
155 days after the date the Project is admitted into the Borrowing Base.

                  4.1.10.6 Evidence that the Borrower has procured insurance
policies as required by the terms of this Agreement. The evidence of insurance
shall contain the agreement of the insurer to give not less than thirty (30)
days' (ten (10) days' for non-payment of premium) notice to the Agent prior to
cancellation of such policies or material change in the coverage thereof and
shall be on a form ACORD 27 (with respect to property insurance), ACORD 25 (with
respect to liability insurance), or such similar form as is acceptable to Agent.

                  4.1.10.7 If requested by Agent, a survey or other plan
reasonably acceptable to Agent of the Real Estate included in the Project,
showing any encroachments by or on the Real Estate and the location of all
easements and rights-of-way affecting such Real Estate, all present and proposed
utility lines, encroachments and building set-back lines.

                  4.1.10.8 An environmental indemnity agreement with respect to
the Project, executed by the Borrower and Guarantor, in form reasonably
acceptable to Agent.

                  4.1.10.9 An Appraisal of the Project.



                                       34
<PAGE>

                  4.1.10.10 An Environmental Report for such Project, indicating
that the Real Estate is not subject to any Environmental Conditions and is in
compliance with all applicable Environmental Laws, that no Regulated Substances
have been disposed of in, on or under the Real Estate for which remediation has
not been completed or is not contemplated as part of the development of the
Project, and that there are no underground storage tanks in the Real Estate.

                  4.1.10.11 If requested by Agent, (i) copies of all
Governmental Approvals theretofore issued with respect to the Project, permits,
use registrations and approvals required under any law (including, without
limitation thereto, planning, zoning, subdivision and building laws) for
construction of the Units and Improvements and use thereof by the Borrower or by
the purchasers thereof, and such other evidence as the Agent may require that
the Units and use thereof contemplated by the Borrower, are permitted by and
comply with all applicable laws including, without limitation thereto, zoning
ordinances, and (ii) with respect to the addition of Approved or Improved Land
to the Borrowing Base, a certification by the appropriate Borrower that all
Governmental Approvals required for the lawful commencement of construction of
Units thereon (other than building permits for such Units) have been issued and
continue to be in full force and effect and available to the appropriate
Borrower (or, with respect to Approved Land, the same will be issued within 120
days).

                  4.1.10.12 Such other information and documents that the Agent
may reasonably request. It is understood that the failure of the Agent to demand
a certain type of information or document in regard to a Project will not
constitute a waiver by the Agent of its right to demand that type of information
or document in the future.

              4.1.11 Such other and further documents as may be required
reasonably by the Agent or Lenders in order to consummate the transactions
contemplated hereunder.

         4.2 Availability of Letters of Credit and Tri-Party Agreements. The
agreement of the Lenders to cause Agent to issue any Letter of Credit or
Tri-Party Agreement is subject to the following conditions precedent, any of
which may be waived by the Agent, at its sole discretion:

              4.2.1 All of the conditions in this Agreement (including, but not
limited to those in Section 4.1) remain satisfied, and all instruments and
agreements referred to in Section 4.1 remain in full force and effect.

              4.2.2 No Event of Default specified herein or in any other Loan
Document shall have occurred and be continuing; the representations, covenants
and warranties of the Borrowers herein or in any of the Loan Documents shall be
true on and as of the date of the issuance of such Letter of Credit or Tri-Party
Agreement with the same force and effect as if made on and as of such date,
except for those that relate to a specific date or those which cannot be made
due to changes in circumstances of which Borrowers have given notice to Agent
and which would not, but for delivery of notice or passage of time, or both,
constitute an Event of Default, and the Borrowers shall so certify to Agent.

              4.2.3 The requesting Borrower shall have delivered to Agent
executed (and, if necessary, notarized) copies of the following (all of which
shall be in a form and contain such terms as shall be acceptable to the Lender,
in its sole discretion):



                                       35
<PAGE>

                  4.2.3.1 A Letter of Credit Application, if required.

                  4.2.3.2 Copies of all financial security agreements,
development agreements or similar documents, under which the obligations of the
requesting Borrower are to be secured by the requested Letter of Credit or
Tri-Party Agreement. Such documents must be in a form satisfactory to the Agent.

                  4.2.3.3 Such other information and documents that Agent may
reasonably request. It is understood that the failure of Agent to demand a
certain type of information or document in regard to the issuance of a Letter of
Credit or Tri-Party Agreement will not constitute a waiver by Agent of its right
to demand that type of information or document in the future.

              4.2.4 The Project for which the Letter of Credit or Tri-Party
Agreement has been requested is in an Approved Jurisdiction.

         4.3 Conditions Precedent to Swing Line Loans.

              4.3.1 The obligation of Swing Line Lender to make any Swing Line
Loan shall be subject to the further conditions precedent that, on the date of
such the advance of a Swing Line Loan; no Event of Default has occurred and is
continuing, or would result from the requested Swing Line Loan.

              4.3.2 No litigation (including, without limitation, derivative
actions), arbitration proceedings or governmental proceedings not disclosed in
writing by Borrowers to the Agent shall be pending or known to be threatened
against any Borrower or Guarantor, and no material development not so disclosed
shall have occurred in any litigation (including, without limitation, derivative
actions), arbitration proceedings or governmental proceedings so disclosed,
which in any of the foregoing cases is likely to have a Materially Adversely
Effect on Borrowers or Guarantor or impair the ability of Borrowers or Guarantor
to perform their obligations under the Loan Documents to which they are a party.

              4.3.3 Agent shall have received such other approvals, opinions, or
documents as the Agent may in good faith request.

                   ARTICLE V. REPRESENTATIONS AND WARRANTIES

         In addition to the representations and warranties contained in any
other Loan Documents, Borrowers hereby make the following representations and
warranties to Agent and the Lenders which, to the knowledge of Borrowers, are
true and correct on the date hereof:

         5.1 Use of Proceeds. The proceeds of the Facility shall be used by
Borrowers only for Business purposes.

         5.2 Incorporation, Good Standing, and Due Qualification.

              5.2.1 Master Borrower and Guarantor are each a corporation duly
incorporated, validly existing, and in good standing under the laws of the state
of its incorporation, has the corporate power and authority to own its assets
and to transact the business in which it is now engaged or proposed to be
engaged in; and is duly qualified as a foreign corporation and in good standing
under the laws of each other jurisdiction in which such qualification is
required, except where the failure to be so qualified will not have a material
and adverse effect on the business and operations of the subject corporation.



                                       36
<PAGE>

              5.2.2 Each Borrower is either a corporation, limited partnership
or limited liability company, duly incorporated or organized, validly existing,
and in good standing under the laws of the state of its formation, has the power
and authority to own its assets and to transact the business in which it is now
engaged or proposed to be engaged in; and is duly qualified as a foreign
corporation, limited partnership or limited liability company and in good
standing under the laws of each other jurisdiction in which such qualification
is required.

         5.3 Power and Authority. The execution, delivery, and performance by
Borrowers and Guarantor of the Loan Documents to which they are parties have
been duly authorized by all necessary corporate, partnership or limited
liability company action, as appropriate, and do not and will not (i) require
any consent or approval of the shareholders, partners or members of any such
entity; (ii) contravene such entity's Organizational Documents; (iii) violate
any provision of or cause or result in a breach of or constitute a default under
any law, rule, regulation (including, without limitation, Regulation U of the
Board of Governors of the Federal Reserve System), order, writ, judgment,
injunction, decree, determination, or award presently in effect having
applicability to such entity; (iv) cause or result in a breach of or constitute
a default under any indenture or loan or credit agreement or any other
agreement, lease, or instrument to which such entity is a party or by which it
or its properties may be bound or affected or; (v) cause or result in or require
the creation or imposition of any Lien upon or with respect to any of the
properties now owned or hereafter acquired by such Guarantor or Borrower except
as contemplated by this Agreement.

         5.4 Legally Enforceable Agreement. This Agreement is, and each of the
other Loan Documents executed by Borrowers or Guarantor when delivered under
this Agreement will be, legal, valid, and binding obligations of Borrowers or
Guarantor, enforceable against it or them in accordance with the respective
terms thereof, except to the extent that such enforcement may be limited by
applicable bankruptcy, insolvency, and other similar laws affecting creditors'
rights generally.

         5.5 Financial Statements; Accuracy of Information.

              5.5.1 The Financial Statements of Borrowers and Guarantor for the
period ending September 30, 2005 delivered to Agent and Lenders are true and
correct and represent fairly their financial positions as of the date thereof
and the results of their operations or affairs for the period indicated, and
show (including the footnotes) all known liabilities, direct or contingent, of
Borrowers or Guarantor as of the date thereof, all in accordance with GAAP
consistently applied. Since the date of such Financial Statements, there has
been no material adverse change in condition, financial or otherwise, of
Borrowers or Guarantor or in its or their business and properties and, since
such date, neither Borrowers nor Guarantor has incurred, other than in the
ordinary course of business, any indebtedness, liabilities, obligations or
commitments, contingent or otherwise. No information, exhibit, or report
furnished by Borrowers or Guarantor to Agent or the Lenders in connection with
the negotiation of this Agreement contained any material misstatement of fact or
omitted to state a material fact or any fact necessary to make the statement
contained therein not materially misleading. All projections delivered by
Borrowers to Agent were made on a reasonable basis and in good faith. Except as
disclosed to Agent in writing, neither any Borrower nor Guarantor has any
material contingent liabilities (including liabilities for taxes), unusual
forward or long-term commitments or unrealized or anticipated losses from
unfavorable commitments.



                                       37
<PAGE>

              5.5.2 All information, financial statements, exhibits, and reports
furnished by Borrowers or Guarantor to Agent or the Lenders in connection with
this Agreement and the borrowings contemplated hereby are, and all such
information, financial statements, exhibits and reports hereafter furnished by
Borrowers or Guarantor to Agent or the Lenders will be, true and correct in
every material respect on the date so furnished for the periods covered thereby,
and no such information, financial statements, exhibit or report contains or
will contain any material misstatement of fact or omits or will omit to state a
material fact or any fact necessary to make the statement contained therein not
materially misleading.

         5.6 Conflicts. The execution, delivery and performance of this
Agreement and the Loan Documents will not violate any provision of any
indenture, agreement, or other instrument to which any Borrower, Guarantor, or
any of their respective properties or assets are bound, and will not be in
conflict with, result in a breach of, or constitute (with due notice and/or
lapse of time) a default under any such indenture, agreement, or other
instrument, or result in the creation or imposition of any lien, charge, or
encumbrance of any nature whatsoever upon any of said properties or assets.

         5.7 Consents. No authorization, consent, approval, license or exemption
of, and no registration, qualification, designation, declaration or a filing
with any court or governmental department, commission, board, bureau, agency or
instrumentality, domestic or foreign is necessary to the valid execution and
delivery by Borrowers or Guarantor of this Agreement and the other Loan
Documents to which each is a party.

         5.8 Litigation. Except as disclosed on Schedule 5.8, there is no
pending or threatened action or proceeding against or affecting any Borrower or
Guarantor before any court, governmental agency, or arbitrator which may, in any
one case or in the aggregate, a Materially Adverse Effect on the financial
condition, operations, properties or business of Borrowers or the Guarantor or
the ability of Borrowers or the Guarantor to perform their obligations under any
Loan Documents to which it or they are a party.

         5.9 Other Agreements. Neither any Borrower nor Guarantor is a party to
any indenture, loan, or credit agreement, or to any lease or other agreement or
instrument, or subject to any charter or corporate restriction which could have
a Material Adverse Effect on the business, properties, assets, operations, or
conditions, financial or otherwise, of Borrowers or Guarantor, or the ability of
Borrowers or Guarantor to carry out their obligations under the Loan Documents
to which it or they are a party. Neither any Borrower nor Guarantor is in
default in any respect in the performance, observance, or fulfillment of any of
the obligations, covenants, or conditions contained in any agreement or
instrument material to its business to which it is a party and which default
would have a material and adverse effect on the business and operations of
Borrowers and Guarantor, taken as a whole.



                                       38
<PAGE>

         5.10 No Defaults and Outstanding Judgments or Orders. Each Borrower and
Guarantor have satisfied, and none is in default with respect to, any final,
unappealed and unstayed judgment, writ, injunction or decree of any court or
arbitrator, and none of them is in default of any rule or regulation (if such
default would have a Material Adverse Effect on Borrowers or Guarantor) of any
federal, state, municipal, or other governmental authority, commission, board,
bureau, agency or instrumentality, domestic or foreign by which it is bound.

         5.11 Taxes. Borrowers and Guarantor (i) have filed all tax returns
(federal, state, and local) required to be filed and (ii) have paid all taxes,
assessments, and governmental charges and levies due thereon, including interest
and penalties, except such as are being contested in good faith and with respect
to which non-payment will not have a Material Adverse Effect upon Borrowers or
Guarantor.

         5.12 Debt. Neither any Borrower nor Guarantor has any Debt, except
Permitted Debt that is disclosed in their Financial Statements.

         5.13 Ownership and Liens. Borrowers, Guarantor and each subsidiary of
Guarantor has title to in all of its properties and assets, real and personal,
free and clear of all liens other than Permitted Liens.

         5.14 ERISA. Borrowers, Guarantor and each Subsidiary of Guarantor is in
compliance in all material respects with all applicable provisions of ERISA.
Neither a Reportable Event nor a Prohibited Transaction has occurred and is
continuing with respect to any Plan; no notice of intent to terminate a Plan has
been filed nor has any Plan been terminated; to the best of Borrower's knowledge
after due inquiry, no circumstances exist which constitute grounds under Section
4042 of ERISA entitling the PBGC to institute proceedings to terminate, or
appoint a trustee to administer, a Plan, nor has the PBGC instituted any such
proceedings; neither of the any Borrower nor Guarantor nor any ERISA Affiliate
has completely or partially withdrawn under Sections 4201 or 4204 of ERISA from
a Multiemployer Plan; Borrowers, Guarantor and each ERISA Affiliate have met
their minimum funding requirements under ERISA with respect to all of their
Plans and the present fair market value of all Plan assets exceeds the present
value of all vested benefits under each Plan, as determined on the most recent
valuation date of the Plan and in accordance with the provisions of ERISA and
the regulations thereunder for calculating the potential liability of the
Borrower or any ERISA Affiliate to the PBGC or the Plan under Title IV of ERISA;
and neither any Borrower nor Guarantor nor any ERISA Affiliate has incurred any
liability to the PBGC under ERISA.

         5.15 Representations and Warranties as to Real Estate. As to Real
Estate included within the Borrowing Base:

              5.15.1 No Violations Relating to the Real Estate. Borrowers have
no knowledge of any violation, nor is there any notice or other record of
violation of any zoning, subdivision, environmental, building or other statute,
ordinance, regulation, restrictive covenant or other restriction applicable to
the Real Estate, except for violations, if any, which Borrowers have disclosed
in writing to Agent and are proceeding in good faith to remove or correct or
which is subject to contest by applicable proceedings timely commenced and
diligently pursued to conclusion and which non-compliance will not have a
Material Adverse Effect on Borrowers.



                                       39
<PAGE>

              5.15.2 Liens. There exist no liens, encumbrances or other charges
against the Real Estate, or any portion thereof, or any property relating
thereto, including statutory and other liens of mechanics, workmen, contractors,
subcontractors, suppliers, taxing authorities and others, except for Permitted
Liens.

              5.15.3 Operation of Real Estate. The Real Estate and any Units and
Improvements thereon are being and, to the best of Borrowers' knowledge and
belief, have been operated in all material respects, in compliance with
applicable federal and state laws and regulations (including but not limited to
environmental laws and regulations) and with local ordinances, and all permits
required thereunder have been obtained and complied with in all material
respects.

              5.15.4 Environment. Borrowers have duly complied with, and their
businesses, operations, assets, equipment, property, leaseholds, or other
facilities (including, but not limited to, the Real Estate) are in material
compliance with, the provisions of all federal, state, and local Environmental
Laws, and all health, and safety laws, codes and ordinances, and all rules and
regulations applicable to Projects promulgated thereunder. Except as set forth
in the Environmental Reports heretofore delivered to Agent, no Borrower has
received notice of, or knows of, or suspects the existence of any Environmental
Condition which might constitute a violation of, any Environmental Law or any
other federal, state, or local health or safety laws, codes or ordinances, and
any rules or regulations promulgated thereunder with respect to its businesses,
operations, assets, equipment, property, leaseholds, or other facilities
(including, but not limited to, the Real Estate) with which it has not complied
(subject to the prosecution of a good faith contest of any such notice that has
not heretofore been determined adversely to such Borrower).

         5.16 No Violation. Neither any Borrower nor Guarantor has engaged in
any conduct or taken or omitted any act in violation of RICO or of any
Prescribed Law.

         5.17 Accurate and Complete Disclosure. No representation or warranty
made by Borrowers under this Agreement or any other Loan Document is false or
misleading in any material respect (including by omission of material
information necessary to make such representation, warranty of statement not
misleading). Borrowers or the Guarantor have disclosed to Agent in writing every
fact which would have a Material Adverse Effect, or which so far as Borrowers
can now foresee is reasonably possible in the future and would have a Material
Adverse Effect, on the business, operations or financial condition of Borrowers
or the Guarantor or the ability of Borrowers or the Guarantor to perform their
respective obligations under this Agreement or any other Loan Document.

         5.18 Compliance with Covenants. As of the date this representation is
made or deemed made, Borrowers are in compliance with applicable convenants
contained in Article VIII hereof.

         The delivery to Agent of each Notice of Borrowing and request for the
issuance of a Letter of Credit or Tri-Party Agreement shall constitute the
representation and warranty of Borrowers that the conditions contained in
Sections 4.1 and 4.2 are satisfied as of such date, except for those that relate
to a specific date or those which cannot be made due to changes in circumstances
of which Borrowers have given notice to Agent and which would not, but for
delivery of notice or passage of time, or both, constitute an Event of Default,
each of the representations and warranties contained in this Article V is true
and correct as if made on such date.



                                       40
<PAGE>

                       ARTICLE VI. AFFIRMATIVE COVENANTS

         In addition to the covenants contained in the Loan Documents, Borrowers
hereby covenant and agree that, so long as Lenders have any obligation to make
Loans or issue Letters of Credit or Tri-Party Agreements hereunder, or any Loan,
Letter of Credit Advance or Swing Line Loan is outstanding, except as the Agent
may otherwise advise Master Borrower in writing with the consent of Lenders in
accordance with Section 11.10:

         6.1 Reporting Requirements. Borrowers shall furnish, or cause to be
furnished, to Agent and either Agent or Master Borrower shall furnish to
Lenders:

              6.1.1 As soon as available, and in any event within one hundred
twenty (120) days after the end of each Fiscal Year, audited Financial
Statements of Guarantor (which shall include a consolidated balance sheet and a
consolidated statement of operations) through the end of such Fiscal Year, and a
consolidated statement of cash flow for such Fiscal Year, all in reasonable
detail and stating in comparative form the respective figures for the
corresponding date and period in the prior Fiscal Year and all prepared in
accordance with GAAP consistently applied and accompanied by an unqualified
opinion thereon, on a basis acceptable to Agent, by PricewaterhouseCoopers LLP
or by another national firm of independent certified public accountants selected
by Guarantor and acceptable to Agent in good faith.

              6.1.2 As soon as available, and in any event within fifty (50)
days after the close of each Fiscal Quarter, unaudited management-prepared
quarterly Financial Statements of Guarantor (which shall include a Consolidated
Balance Sheet and a Consolidated Statement of Operations) as of the end of each
Fiscal Quarter, all in reasonable detail and prepared in conformity with GAAP,
applied on a basis consistent with that of the preceding Fiscal Year. Such
statements shall be certified as to their correctness by the chief financial
officer of Guarantor.

              6.1.3 Within sixty (60) days after the end of each Fiscal Year, a
management-prepared business plan and budget of Guarantor, Borrowers, and
Guarantor's other subsidiaries for the then-current Fiscal Year.

              6.1.4 Within sixty (60) days after the end of each Fiscal Year, a
comparison of the Borrowers' and Guarantor's actual results during the preceding
Fiscal Year with the budgeted results for such period.

              6.1.5 Within ten (10) days of the end of each month, a detailed
sales activity report prepared by Borrowers for each Project.

              6.1.6 Within fifteen (15) days after the end of each Fiscal
Quarter, an aging report of all Lots owned by any Borrower.



                                       41
<PAGE>

              6.1.7 Prompt notification of (i) the institution of any material
litigation or the commencement of any material administrative proceedings
against a Borrower or Guarantor, (ii) the entry of any judgment against any
Borrower or Guarantor in an amount in excess of $250,000, (iii) the occurrence
of any default with respect to any Permitted Subordinated Debt or (iv) the
happening of any other event which would have a Material Adverse Effect upon
Borrowers or Guarantor.

              6.1.8 Upon the occurrence of an Event of Default, a written notice
setting forth the details of such Event of Default and the action which is
proposed to be taken by Borrowers with respect thereto.

              6.1.9 As soon as possible and in any event within five (5) days
after any Borrower or Guarantor knows or has reason to know that any Reportable
Event or Prohibited Transaction has occurred with respect to any Plan or that
the PBGC, any Borrower or Guarantor has instituted or will institute proceedings
under Title IV of ERISA to terminate any Plan, Borrowers will deliver to Agent a
certificate of the chief financial officer of Guarantor setting forth details as
to such Reportable Event or Prohibited Transaction or Plan termination and the
action such Borrower or Guarantor proposes to take with respect thereto.

              6.1.10 Such other information respecting the condition or
operations, financial or otherwise, of Borrowers or Guarantor as the Agent (or
any Lender acting through Agent) may from time to time reasonably request.

         6.2 Payment of Taxes. Borrowers and Guarantor shall each duly pay and
discharge all taxes, assessments and governmental charges levied upon or
assessed against it, its properties, or its income prior to the date on which
penalties are attached thereto and, within thirty (30) days after any request
therefor by Agent (if Agent reasonably believes any such taxes, etc., have not
been paid when due), deliver to Agent a receipt from the applicable governmental
authority evidencing said payment, unless and except to the extent only that
such taxes, assessments and charges shall be contested in good faith by
appropriate proceedings diligently conducted by Borrowers (unless and until
foreclosure, distraint, sale or other similar proceedings shall have been
commenced) or the Guarantor and provided that such reserves as shall be required
by GAAP shall have been made and maintained therefor.

         6.3 Access to Properties, Books and Records. Borrowers shall, and shall
cause Guarantor to, (i) permit any of the officers, employees or representatives
of Agent or (if accompanied by an officer, employee or representative of Agent)
of any Lender to visit and inspect any of the Real Estate of Borrowers and (ii)
permit any officers, employees or representatives of Agent to examine Borrowers'
and Guarantor's books and records and make extracts therefrom and discuss the
affairs, finances, and accounts of Borrowers and Guarantor with representatives
thereof, during normal business hours, and as often as Agent may reasonably
request upon prior telephone notice.

         6.4 Maintenance of Records. Borrowers shall, and shall cause Guarantor
to, keep adequate records and books of account, in which complete entries were
made in accordance with generally accepted accounting principals consistently
applied, reflecting all financial transactions of Borrowers and Guarantor.



                                       42
<PAGE>

         6.5 Maintenance of Existence. Each Borrower shall, and shall cause
Guarantor to, preserve and maintain its existence and good standing in the
jurisdiction of its formation, and qualify and remain qualified as a foreign
entity in each jurisdiction in which such qualification is required.

         6.6 Insurance. Borrowers shall (and with respect to the insurance
described in Section 6.6.7 shall cause Guarantor to) take out, maintain and keep
in force, throughout the term of the Facility, policies of insurance on the
following terms:

              6.6.1 Insurance against loss to each Project on a "Special Perils"
policy form, covering insurance risks no less broad than those covered under a
Standard Multi Peril (SMP) policy form, which contains the most recent
Commercial ISO "Causes of Loss-Special Form," in commercially reasonable amounts
and with endorsements as heretofore customarily maintained by subsidiaries of
Guarantor, issued by insurers licensed in the jurisdiction in which each Project
is located and that satisfy Agent's then-current standards for property insurers
and complying with the requirements of the Mortgages.

              6.6.2 Commercial general liability insurance against death, bodily
injury and property damage arising on, about or in connection with each Project,
with limits not less than those heretofore maintained by subsidiaries of
Guarantor and written on the most recent Standard "ISO" occurrence basis form or
equivalent form, excess umbrella liability coverage with limits not less than
those heretofore maintained by subsidiaries of Guarantor and completed
operations coverage for a period of one year after construction of Units, issued
by insurers licensed in the jurisdiction in which each Project is located and
that satisfy Agent's then-current standards for liability insurers.

              6.6.3 Worker's compensation insurance in an amount not less than
those that are statutorily required in each jurisdiction in which Borrowers
operate.

              6.6.4 During the making of any alterations or improvements to any
Project, insurance covering claims based on the owner's or employer's contingent
liability not covered by the insurance provided in Section 6.6.2 above

              6.6.5 Insurance against loss or damage by flood or mud slide in
compliance with the Flood Disaster Protection Act of 1973, as amended from time
to time, covering each Project that is now, or at any time while the
Indebtedness remains outstanding shall be, situated in any area which an
appropriate governmental authority designates as a special flood hazard area, in
amounts equal to the full replacement value of all above grade structures
located or to be constructed in such special flood hazard area;

              6.6.6 Such other insurance relating to the Projects and the uses
and operation thereof as Agent may, from time to time, reasonably require,
including, but not limited to products liability and workers' compensation
insurance;

              6.6.7 Directors' and officers' liability insurance in the forms,
and in amounts not less than that which is now carried by Borrowers and
Guarantor;



                                       43
<PAGE>

              6.6.8 All insurance shall: (i) be carried in companies with a
Rating of A- or better and a Financial Size Category of Class IX or higher, as
set forth in the most recently published Best's Key Rating Guide, or otherwise
acceptable to Agent; (ii) in form and content acceptable to Agent; and (iii)
provide thirty (30) days' (ten (10) days' for non-payment of any premium)
advance written notice to Agent before any cancellation, material modification
or notice of non-renewal. All physical damage policies and renewals shall
contain a mortgage clause acceptable to Agent, naming Agent as mortgagee, which
clause shall expressly state that any breach of any condition or warranty by any
Borrower shall not prejudice the rights of Agent under such insurance, and a
loss payable clause in favor of Agent for personal property, contents,
inventory, equipment, loss of rents and business interruption. All liability
policies and renewals shall name Agent and each Lender as an additional insured.
No additional parties shall appear in the mortgage or loss payable clause
without Agent's prior written consent. All deductibles shall be in amounts
acceptable to Agent. In the event of the foreclosure of any Mortgage or any
other transfer of title to any Borrower in full or partial satisfaction of the
Indebtedness, all right, title and interest of each Borrower in and to all
insurance policies and renewals thereof then in force shall pass to such
purchaser or grantee. If the insurance, or any part thereof, shall expire, or be
withdrawn, or become void or unsafe by reason of any Borrower's breach of any
condition thereof, or become void or unsafe by reason of the value or impairment
of the capital of any company in which the insurance may then be carried, or if
for any reason whatever the insurance shall be unsatisfactory to Agent,
Borrowers shall place new insurance that satisfies the requirements of this
Section 6.6;

              6.6.9 Any notice pertaining to insurance and required pursuant to
this Section 6.6 shall be given in the manner provided in this Agreement at the
address from time to time directed by Agent by notice to Master Borrower. The
insurance shall be evidenced by the original policy or a true and certified copy
of the original policy, or in the case of liability insurance, a Certificate of
Liability Insurance. Borrowers shall use their best efforts to deliver originals
of all policies and renewals (or certificates evidencing the same), marked
"paid," to Agent at least thirty (30) days before the expiration of existing
policies and, in any event, Borrowers shall deliver originals of such policies
or certificates to Agent at least fifteen (15) days before the expiration of
existing policies. If Agent has not received satisfactory evidence of such
renewal or substitute insurance in the time frame specified herein, Agent shall
have the right, but not the obligation, to purchase such insurance for Lender's
interest only. Any amounts so disbursed pursuant to this Section 6.6.9 shall be
Lenders' Costs. Nothing contained in this Section 6.6 shall require Agent or any
Lender to incur any expense or take any action hereunder, and inaction by Agent
and Lenders shall never be considered a waiver of any right accruing to
Mortgagee on account of this Section 6.6;

              6.6.10 Prior to the Collateral Release Date, no Borrower shall
carry any separate insurance on any Project concurrent in kind or form with any
insurance required hereunder or contributing in the event of loss without
Agent's prior written consent and any such policy shall have attached a standard
non-contributing mortgagee clause, with loss payable to Agent, and shall meet
all other requirements set forth herein.

         6.7 ERISA. Borrowers shall, and shall cause Guarantor to, comply in all
material respects with the requirements of ERISA applicable to any employee
pension benefit plan (within the meaning of Section 3(2) of ERISA), sponsored by
any Borrower or Guarantor.



                                       44
<PAGE>

         6.8 Accounts. Borrowers shall maintain one or more demand deposit
accounts with Agent into which the proceeds of each Loan and Swing Line Loan
shall be deposited.

         6.9 Compliance with Laws. Borrowers shall, and shall cause Guarantor
to, comply with all applicable laws (including but not limited to any applicable
tax law, product safety law, occupational safety or health law, environmental
protection or pollution control law, hazardous waste or toxic substances
management, handling or disposal law and Prescribed Laws) in all respects,
provided that Borrowers shall not be deemed to be in violation of this Section
as a result of any failures to comply which would not result in fines,
penalties, injunctive relief or other civil or criminal liabilities which, in
the aggregate, would have a Material Adverse Effect on the business, operations
or financial condition of Borrowers or Guarantor or the ability of Borrowers and
Guarantor to perform obligations under this Agreement or any other Loan
Document.

         6.10 Payment of Debt. Borrowers shall, and shall cause Guarantor to,
promptly pay and discharge (i) all of its Debt in accordance with the terms
thereof; (ii) all taxes, assessments, and governmental charges or levies imposed
upon it or upon its income and profits, upon any of its property, real, personal
or mixed, or upon any part thereof, before the same shall become in default;
(iii) all lawful claims for labor, materials and supplies or otherwise, which,
if unpaid, might become a lien or charge upon any Real Estate or, if the same
would have a Material Adverse Effect on Borrowers or Guarantor, against any
other property or any part thereof; provided, however, that so long as Borrowers
notify Agent in writing of their intention to do so, Borrowers and Guarantor
shall not be required to pay and discharge any such Debt, tax, assessment,
charge, levy or claim so long as the failure to so pay or discharge does not
constitute or result in an Event of Default and so long as the validity thereof
shall be contested in good faith by appropriate proceedings diligently pursued
and it shall have set aside on its books adequate reserves with respect thereto.

         6.11 Consequential Damages. Neither Agent nor any Lender shall be
responsible or liable for any damages, consequential or otherwise, that may be
incurred or alleged by any Borrower or by any other Person as a result of any of
the Loan Documents or the exercise of right, remedy or discretion by Agent or
any Lender thereunder or the collection by or on behalf of Lenders the sums due
thereunder, unless such damages are incurred as a result of the gross negligence
or willful default hereunder or willful misconduct of Agent or such Lender.

         6.12 Further Assurances. Borrowers agree to do such further acts and
things and to execute and deliver to Agent such additional assignments,
agreements, powers and instruments, as Agent may reasonably require or
reasonably deem advisable to carry into effect the purposes of this Agreement or
to better assure and confirm unto Agent and the Lenders their respective rights,
powers and remedies hereunder.

                        ARTICLE VII. NEGATIVE COVENANTS

         In addition to the covenants contained in the Loan Documents, Borrowers
hereby covenant and agree that, so long as the Lenders have any obligation to
make Loans or issue Letters of Credit hereunder, or any Loan, Letter of Credit
Advance or Swing Line Loan is outstanding, Borrowers shall not, except as Agent
may otherwise advise Master Borrower in writing with the consent of Lenders in
accordance with Section 11.10:



                                       45
<PAGE>

         7.1 Creation of Debt. Create, incur, assume or suffer to exist, or
permit Guarantor to create, incur, assume or suffer to exist, any Debt except
Permitted Debt. No Debt shall be Permitted Subordinated Debt unless each of the
following conditions is satisfied.

                  (i) The Debt is issued at a time when no Event of Default
exists.

                  (ii) A summary of all of the material terms of the proposed
Permitted Subordinated Debt (including, without limitation, the subordination
provisions) is submitted to the Agent for its review and reasonable approval at
least five (5) Business Days prior to issuance of the Debt.

                  (iii) The maturity of such Debt shall be no earlier than 179
days after the then-current Maturity Date at the time of issuance.

                  (iv) The Permitted Subordinated Debt shall contain
subordination provisions (including provisions with respect to payment blockages
(and the resumption of payments) during the continuance of an Event of Default)
as are customary for subordinated or senior subordinated "high yield" or
"mezzanine" financings for issuers with a credit profile similar to that of the
Master Borrower, as determined by Agent in good faith.

                  (v) Agent shall have determined in good faith that the
covenants, restrictions, representations and warranties (when taken together as
a whole) contained in or associated with such Debt are no more burdensome,
onerous or restrictive than those (when taken together as a whole) contained in
the Loan Documents.

                  (vi) Contemporaneously with delivery to the obligee under such
Debt, the Borrowers shall deliver to Agent any and all compliance certificates,
reports or statements required to be delivered under the terms of such Debt.

                  (viii) At no time may the aggregate outstanding principal
amount of Permitted Subordinated Debt exceed $350,000,000.

                  For purposes of this Section 7.1, each material amendment,
modification, restatement, renewal, or supplement of such Permitted Subordinated
Debt (including any instruments that (a) increase the principal balance, (b)
increase the interest rate, (c) shorten the maturity date, (d) purport to modify
the terms imposed by this Section 7.1 or (e) impose more restrictive or onerous
terms upon any Borrower), shall be deemed to be a new issue of Debt and must
satisfy the conditions contained in this Section 7.1.

         By its good faith approval of any Permitted Subordinated Debt, Agent
makes no representation or warranty to Borrowers or Lenders that the terms
thereof are not, or may not be construed as being, more onerous, burdensome or
restrictive than the terms of the Loan Documents, or that the subordination
provisions may not be construed to have been "customary" (as provided in clause
(iv) of this Section 7.1) at the time the subject Debt was issued, and Agent
shall have no liability or obligation to Borrowers or the Lenders in any such
event. To the extent any term of any Debt so approved by Agent as Permitted
Subordinated Debt is in fact interpreted or construed to be more onerous,
burdensome or restrictive than the terms of the Loan Documents, then in such
event, and notwithstanding the provisions of Section 13.1 hereof, the Loan
Documents, in the discretion of Agent or at the request of the Requisite
Lenders, shall be deemed to incorporate and include such more onerous,
burdensome or restrictive terms, without the necessity of any written amendment
or modification to the Loan Documents, and Agent may enforce such terms as
though originally written and contained in the Loan Documents.



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<PAGE>

         7.2 Grant of Liens. Grant, or permit to exist, any lien on any Project
or on any other asset (whether real or personal) of a Borrower or Guarantor,
other than Permitted Liens.

         7.3 Mergers and Acquisitions.

              7.3.1 Merge or consolidate with, or acquire all or substantially
all of the assets or the business of, any Person (or permit Guarantor so to
merge, consolidate or acquire), unless (i), if such merger or consolidation is a
stock acquisition, those Persons who are shareholders of Guarantor immediately
prior to such transaction directly or indirectly have, immediately after the
consummation of the transaction, at least 51% of the voting control of the
surviving entity, (ii) Borrowers remain in compliance with all covenants in this
Agreement upon such merger, consolidation or acquisition, (iii) unless otherwise
agreed by Requisite Lenders, the Leverage Ratio of Guarantor (after giving
effect to such merger, consolidation or acquisition of assets) is not greater
than 1.50:1., and (iv) Master Borrower delivers to Agent, at least ten (10) days
before the consummation of the proposed transaction, a certificate signed by
Guarantor's chief financial officer certifying such continued compliance;
provided, however, that the foregoing clause (iii) shall not apply to the
purchase of all or substantially all of the assets of a natural person or of a
single-purpose entity established for the sole purpose of developing a single
residential development, unless Agent determines, in good faith, that such
purchase is one of a series of related transactions with one Person or group of
affiliated Persons.

              7.3.2 Sell, assign, lease or otherwise dispose of (whether in one
transaction or in a series of transactions) all or substantially all of its
assets (whether now owned or hereafter acquired) to any Person or permit
Guarantor to do any of the foregoing.

         7.4 Transaction With Affiliates. Enter into any transaction, including,
without limitation, the purchase, sale, or exchange of property or the rendering
of any service, with any Affiliate which is not a Borrower, Guarantor, or a
subsidiary of either, including, without limitation, the purchase, sale, or
exchange of property or the rendering of any service, except (a) in the ordinary
course of or pursuant to the reasonable requirements of Borrowers' Business, and
(b) after giving effect to such transaction, Borrowers remain in compliance with
all covenants in this Agreement.

         7.5 Use of Proceeds. Directly or indirectly, use any part of such
proceeds for the purpose of purchasing or carrying any margin stock within the
meaning of Regulation U of the Board of Governors of the Federal Reserve System
or to extend credit to any person for the purpose of purchasing or carrying any
such margin stock, or for any purpose which violates, or is inconsistent with,
Regulation X of the Board of Governors of the Federal Reserve System.

                       ARTICLE VIII. FINANCIAL COVENANTS

         So long as the Obligations shall remain unpaid or Lenders have any
obligation to make Loans or issue Letters of Credit hereunder, Borrowers shall
comply with the following covenants. For purposes of all calculations made for
purposes of determining compliance with the financial covenants contained in
this Article VIII and the interpretation of any defined terms used in this
Article VIII, assets and liabilities associated with option or land bank
arrangements of any Borrower or Affiliate of Guarantor that are required to be
included in the balance sheet of Guarantor, solely due to Interpretation Number
46, as issued by the Financial Accounting Standards Board in January 2003 (as
revised), shall not be included within the calculation performed to determine
compliance with the covenants contained in Sections 8.2, 8.3, 8.4 or 8.5 hereof.
Compliance with the covenants contained in this Article VIII shall, as
appropriate, be determined on the combined Financial Statements of Guarantor
(which shall include all Borrowers, Guarantor and all consolidated subsidiaries
of any Borrower or Guarantor).



                                       47
<PAGE>

         8.1 Interest Coverage. As of the last day of each Fiscal Quarter, the
ratio of Guarantor's Adjusted EBITDA to Debt Service for the Relevant Accounting
Period then ended shall be not less than 2.25:1.

         8.2 Consolidated Tangible Net Worth. Guarantor shall maintain a minimum
Consolidated Tangible Net Worth that at all times is equal to an amount not less
than the sum of (i) $180,000,000 plus (ii) an amount equal to fifty percent
(50%) of the net income of Guarantor earned during each Fiscal Quarter that ends
on or after the date of this Agreement plus (iii) all of the net proceeds of
equity securities issued by Guarantor or any of its subsidiaries after the date
hereof.

         8.3 Leverage.

              8.3.1 As of the last day of each Fiscal Quarter that ends on or
before June 30, 2006, Guarantor's Leverage Ratio shall not exceed 3.25:1.

              8.3.2 As of the last day of each Fiscal Quarter that ends after
June 30, 2006, Guarantor's Leverage Ratio shall not exceed 3.00:1.

              8.3.3 As of the last day of each Fiscal Quarter that ends on or
after the Collateral Release Date, Guarantor's Leverage Ratio shall not exceed
2.25:1.

         8.4 Investments in Joint Ventures. The aggregate value of Guarantor's
and Borrowers' investments in Joint Ventures or in any other entity that is not
directly or indirectly wholly-owned by Guarantor shall at no time exceed fifteen
(15%) percent of Guarantor's Consolidated Adjusted Tangible Net Worth.

         8.5 Ownership of Land.

              8.5.1 At no time on or before March 31, 2007, shall either (i) the
aggregate book value of all Approved Land and Raw Land owned by Borrowers,
Guarantor or any subsidiary of a Borrower or Guarantor exceed thirty percent
(30%) of Guarantor's Consolidated Adjusted Tangible Net Worth or (ii) the ratio
of (a) the book value of all Land owned by Borrowers, Guarantor or any
subsidiary of a Borrower or Guarantor which is not subject to a Qualifying
Agreement of Sale and on which no Unit has been constructed or is being
constructed to (b) Guarantor's Consolidated Adjusted Tangible Net Worth exceed
1.75:1.



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<PAGE>

              8.5.2 At no time on or after March 31, 2007, and prior to the
Collateral Release Date, shall either (i) the aggregate book value of all
Approved Land and Raw Land owned by Borrowers, Guarantor or any subsidiary of a
Borrower or Guarantor exceed thirty percent (30%) of Guarantor's Consolidated
Adjusted Tangible Net Worth or (ii) the ratio of (a) the book value of all Land
owned by Borrowers, Guarantor or any subsidiary of a Borrower or Guarantor which
is not subject to a Qualifying Agreement of Sale and on which no Unit has been
constructed or is being constructed to (b) Guarantor's Consolidated Adjusted
Tangible Net Worth exceed 1.50:1.

              8.5.3 Notwithstanding the provisions of Sections 8.5.1 and 8.5.2
hereof, at no time on or after the Collateral Release Date shall either (i) the
aggregate book value of all Approved Land and Raw Land owned by Borrowers,
Guarantor or any subsidiary of a Borrower or Guarantor exceed twenty-five
percent (25%) of Guarantor's Consolidated Adjusted Tangible Net Worth or (ii)
the ratio of (a) the book value of all Land owned by Borrowers, Guarantor or any
subsidiary of a Borrower or Guarantor which is not subject to a Qualifying
Agreement of Sale and on which no Unit has been constructed or is being
constructed to (b) Guarantor's Consolidated Adjusted Tangible Net Worth exceed
1.25:1.

         8.6 Units in Inventory. At no time shall the aggregate number of Units
(whether completed or under construction) owned by Borrowers, Guarantor or any
subsidiary of Guarantor and not subject to a Qualifying Agreement of Sale exceed
thirty percent (30%) of the total number of Units sold and settled by Borrowers,
Guarantor and all subsidiaries of Guarantor during the immediately preceding
four (4) Fiscal Quarters.

         8.7 Reports Regarding Financial Covenants. Within fifty (50) days
following the end of each Fiscal Quarter, Borrowers shall submit to Agent a
Covenant Compliance Certificate, in the form attached hereto as Exhibit 8.7 and
executed by the chief financial officer of Guarantor, confirming that the
Borrower is in compliance with the financial covenants of this Article VIII as
of the dates provided herein for compliance.

                         ARTICLE IX. EVENTS OF DEFAULT

         The occurrence of any of the following shall constitute an Event of
Default hereunder:

         9.1 The failure of Agent to receive from Borrowers payment of any sum
as required pursuant to this Agreement or any other Loan Document within ten
(10) days after the same is payable, provided that the failure of Borrowers to
pay the entire Indebtedness to Agent on the Maturity Date shall be an immediate
Event of Default, without notice.

         9.2 The failure of Borrowers to observe or perform any promise,
covenant, warranty, obligation, representation or agreement in this Agreement or
in any other Loan Document, or in any other document evidencing or securing any
of the Obligations or the repayment thereof (and not specifically addressed in
the other Sections of this Article IX), within twenty (20) days after written
notice from Agent; provided that the notice and cure period contained in this
Section 9.2 shall not apply to the breach of any covenant or obligation
contained in Sections 3.4, 6.5, 7.1, 7.2, or 7.3 or in Article VIII, or to any
other failure that, by its nature, is not susceptible to being cured by
Borrowers or Guarantor.



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<PAGE>

         9.3 Any assignment for the benefit of the creditors of Borrower, the
filing of any other proceedings by Borrower or by any other person or entity
rendering Borrower or any of the Real Estate subject to a proceeding in
insolvency or in bankruptcy, either for liquidation or for reorganization (and
in the case of an involuntary proceeding under the Bankruptcy Code, the failure
to have same dismissed prior to the entry of an Order for Relief); or if
Borrower shall become insolvent or unable to pay debts as they mature.

         9.4 The dissolution or reorganization of Borrower.

         9.5 The (i) entry of a judgment or judgments against Borrower at any
time (a) in an aggregate amount that is at least $500,000 in excess of insurance
proceeds available to Borrower with respect to such judgment or judgments, if
such judgment or judgments are not dismissed or bonded within thirty (30) days
or (b) that prevents Borrower from conveying Lots and Units in the ordinary
course of business if such judgment or judgments are not dismissed or bonded
within thirty (30) days, or (ii) issuance of any writs of attachment, execution
or garnishment against Borrower.

         9.6 The furnishing to Agent or any Lender, heretofore or hereafter, by
or on behalf of Borrower of materially false information, or the refusal by
Borrower to hereafter provide material information to Agent upon request.

         9.7 If any signature, certificate, opinion, financial statement or
other information heretofore or hereafter furnished or made by Borrower to Agent
or the Lenders shall prove to be false, incorrect, incomplete or misleading in
any material respect on or as of the date furnished, made or deemed made.

         9.8 Any material adverse change in the financial condition of Borrower
which causes Requisite Lenders, in good faith, to believe that performance of
any of the Obligations herein is impaired or doubtful for any reason whatsoever.

         9.9 Any warranty or representation by Borrower contained in this
Agreement or in any other Loan Document is now or hereafter materially false or
incorrect when made or deemed made.

         9.10 Subject to any applicable grace or cure period therein contained,
the occurrence of any "Event of Default" as defined in or occurring under any
Loan Document.

         9.11 The occurrence of any default under the terms of any note or other
instrument that evidences Permitted Subordinated Debt, which default continues
beyond any applicable cure period contained therein.

         For purposes of this Article IX, the term "Borrower" shall include (i)
each Person that is then included in the definition of "Borrower" contained in
this Agreement and (ii) for purposes of Sections 9.3 through 9.8, inclusive,
also Guarantor.



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<PAGE>

                              ARTICLE X. REMEDIES

         10.1 Remedies of Lenders. Upon the occurrence of an Event of Default
hereunder and the completion of any applicable grace or cure period, and during
continuance of such Event of Default, (i) with the consent of Requisite Lenders
Agent may and (ii) upon the request of Requisite Lenders Agent shall, by notice
to Master Borrower on behalf of the Lenders, and with respect to Section 10.1.3
each individual Lender may, exercise all or any of the following remedies, all
of which rights and remedies shall be cumulative:

              10.1.1 Demand immediate payment in full of all Indebtedness,
whereupon the same shall be immediately due and payable.

              10.1.2 Immediately terminate Lenders' obligations to make any
Loans or to issue any Letters of Credit or Tri-Party Agreements hereunder and
Swing Line Lender's obligation to make Swing Line Loans.

              10.1.3 Set off and apply any and all deposits (general or special,
time or demand, provisional or final) at any time held by any Lender to or for
the credit or the account of any Borrower, irrespective of whether Agent or
Lenders shall have made any demand under this Agreement, the Line of Credit
Notes, the Swing Line Note or any other Loan Document and although such
obligations may be unmatured (which rights of the Lenders are in addition to
other rights and remedies, including, without limitation, other rights of
setoff, which the Lenders may have). All net funds recovered under the rights
provided in this Section 10.1.3 shall be recovered by Lenders as agent for the
other Lenders and shall be distributed among Lenders according to their Pro Rata
Share. Each Lender shall be an agent of all other Lenders for purposes of rights
of set-off.

              10.1.4 Exercise its rights or remedies granted herein, or under
applicable law, or which it may otherwise have under any other Loan Document,
against Borrowers or against Guarantor.

              10.1.5 Notwithstanding anything to the contrary contained in this
Section 10.1, upon the occurrence with respect to Guarantor of any event
describe in Section 9.3, the entire Indebtedness shall be immediately due and
payable and Lenders' obligations to make Loans or to issue Letters of Credit or
Tri-Party Agreements and Swing Line Lender's obligation to make Swing Line
Loans, shall automatically and immediately terminate, without notice from Agent
or any Lender.

         10.2 Effect of Delay. Neither failure nor delay on the part of Agent or
the Lenders to exercise any right, power or privilege hereunder shall operate as
a waiver thereof, nor shall any single or partial exercise of any right, power
or privilege hereunder preclude any other or further exercise thereof or the
exercise of any other right, power or privilege.

         10.3 Acceptance of Partial Payment. The acceptance by the Lenders of
any partial payments of Loans, Letter of Credit Advances or Swing Line Loans
made by any Borrower after the occurrence of an Event of Default hereunder, or
the advance of any additional funds or the issuance of a Letter of Credit or
execution of a Tri-Party Agreement at any such time, shall not be deemed a
waiver by the Lenders of such Event of Default unless expressly agreed in
writing by the Agent.



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<PAGE>

         10.4 Other Available Remedies. The enumeration of the rights and
remedies of the Agent and the Lenders set forth in this Agreement is not
intended to be exhaustive and the exercise by the Agent and the Lenders of any
right or remedy shall not preclude the exercise of any other rights or remedies,
all of which shall be cumulative, and shall be in addition to any other right or
remedy given hereunder or under any other Loan Documents or that may now or
hereafter exist in law or in equity or by suit or otherwise.

         10.5 Waiver of Marshalling of Assets. To the fullest extent permitted
by law, each Borrower, for itself and its successors and assigns, waives all
rights to a marshalling of the assets of Borrowers and others with interests in
any Borrower, and of the Projects, or to a sale in inverse order of alienation
in the event of foreclosure of all or any of the Mortgages, and agrees not to
assert any right under any laws pertaining to the marshalling of assets, the
sale in inverse order of alienation, homestead exemption, the administration of
estates of decedents, or any other matters whatsoever to defeat, reduce or
affect the right of Agent or Lenders under the Loan Documents to a sale of the
Projects for the collection of the Indebtedness without any prior or different
resort for collection or of the right of Lenders to the payment of the
Indebtedness out of the net proceeds of the Projects in preference to every
other claimant whatsoever. In addition (but subject to any applicable statute or
law governing deficiencies remaining after the sale of any collateral), each
Borrower, for itself and its successors and assigns, waives in the event of
foreclosure of any or all of the Mortgages, any equitable right otherwise
available to any Borrower which would require the separate sale of the Projects
or require Agent to exhaust its remedies against any individual or any
combination of the Projects before proceeding against any other Project or
combination of Projects; and further in the event of such foreclosure each
Borrower hereby expressly consents to and authorizes, at the option of Agent,
the foreclosure and sale either separately or together of any combination of the
Projects, to the extent permitted by any applicable statute or law.

         10.6 Waiver of Counterclaim. Each Borrower hereby waives the right to
assert a counterclaim, other than a mandatory or compulsory counterclaim, in any
action or proceeding brought against it by Agent or Lenders.

                             ARTICLE XI. THE AGENT

         11.1 Appointment. Each of the Lenders hereby irrevocably designates and
appoints Agent as agent of such Lender under this Agreement and the other Loan
Documents for the term hereof and each such Lender irrevocably authorizes Agent,
as agent for such Lender, to take such action on its behalf under the provisions
of this Agreement and the other Loan Documents and to exercise such powers and
perform such duties as are expressly delegated to the Agent by the terms of this
Agreement and such other Loan Documents, together with such other powers as are
reasonably incidental thereto. Notwithstanding any provision to the contrary
elsewhere in this Agreement or such other Loan Documents, the Agent shall not
have any duties or responsibilities, except those expressly set forth herein and
therein, or any fiduciary relationship with any Lender, and no implied
covenants, functions, responsibilities, duties, obligations or liabilities shall
be read into this Agreement or the other Loan Documents or otherwise exist
against the Agent. Any reference to the Agent in this Article XI shall be deemed
to refer to the Agent solely in its capacity as Agent and not in its capacity as
a Lender.



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<PAGE>

         11.2 Delegation of Duties. Agent may execute any of its respective
duties under this Agreement and the other Loan Documents by or through agents or
attorneys-in-fact and shall be entitled to rely on advice of counsel concerning
all matters pertaining to such duties. Agent shall not be responsible for the
negligence or misconduct of any agents or attorneys-in-fact selected by Agent
with reasonable care.

         11.3 Exculpatory Provisions. Neither Agent nor any of its officers,
directors, employees, agents, attorneys-in-fact, subsidiaries or affiliates
shall be (i) liable for any action taken or omitted to be taken by it or such
Person under or in connection with this Agreement or the other Loan Documents
(except for actions occasioned solely by its or such Person's own gross
negligence or willful misconduct), or (ii) responsible in any manner to any of
the Lenders for (a) any recitals, statements, representations or warranties made
by Borrowers or any officer thereof contained in this Agreement or the other
Loan Documents or in any certificate, report, statement or other document
referred to or provided for in, or received by Agent under or in connection
with, this Agreement or the other Loan Documents or, (b) the satisfaction of any
condition specified herein, other than receipt of items required to be delivered
to Agent, or (c) for the value, validity, effectiveness, genuineness,
enforceability or sufficiency of this Agreement or the other Loan Documents, or
(d) for any failure of Borrowers or Guarantor to perform their obligations
hereunder or thereunder. Agent shall not be under any obligation to any Lender
to ascertain or to inquire as to the observance or performance of any of the
agreements contained in, or conditions of, this Agreement, or to inspect the
properties, books or records of Borrowers or Guarantor. Agent shall have no duty
to disclose to Lenders information that is not required to be furnished by
Borrowers or Guarantor to Agent at such time, but is voluntarily furnished by
any Borrower or Guarantor to Agent in its individual capacity.

         11.4 Reliance by Agent. Agent shall be entitled to rely, and shall be
fully protected in relying, upon any note, writing, resolution, notice, consent,
certificate, affidavit, letter, cablegram, telegram, telecopy, telex or teletype
message, statement, order or other document or conversation believed by it to be
genuine and correct and to have been signed, sent or made by the proper Person
or Persons and upon advice and statements of legal counsel (including, without
limitation, counsel to the Borrowers), independent accountants and other experts
selected by Agent. Agent may deem and treat the payee of any Note as the owner
thereof for all purposes unless such Note shall have been transferred in
accordance with Section 13.9 hereof. Agent shall be fully justified in failing
or refusing to take any action under this Agreement and the other Loan Documents
unless it shall first receive such advice or concurrence of the Requisite
Lenders (or, when expressly required hereby or by the relevant other Loan
Document, all the Lenders) as it deems appropriate or it shall first be
indemnified to its satisfaction by the Lenders against any and all liability and
expense which may be incurred by it by reason of taking or continuing to take
any such action except for its own gross negligence or willful misconduct. Agent
shall in all cases be fully protected in acting, or in refraining from acting,
under this Agreement and the Notes in accordance with a request of the Requisite
Lenders (or, when expressly required hereby, all the Lenders), and such request
and any action taken or failure to act pursuant thereto shall be binding upon
all the Lenders and all future holders of the Notes.



                                       53
<PAGE>

         11.5 Non-Reliance on Agent and Other Lenders. Each Lender expressly
acknowledges that neither Agent nor any of its respective officers, directors,
employees, agents, attorneys-in-fact, subsidiaries or affiliates has made any
representations or warranties to it and that no act by Agent hereinafter taken,
including any review of the affairs of the Borrowers, Guarantor or any of their
respective Affiliates, shall be deemed to constitute any representation or
warranty by Agent to any Lender. Each Lender represents to Agent that it has,
independently and without reliance upon Agent or any other Lender, and based on
such documents and information as it has deemed appropriate, made its own
appraisal of and investigation into the business, operations, property,
financial and other condition and creditworthiness of Borrowers, Guarantor and
their respective Affiliates and made its own decision to make Loans and Line of
Credit Advances, to participate in Swing Line Loans and to enter into this
Agreement. Each Lender also represents that it will, independently and without
reliance upon Agent or any other Lender, and based on such documents and
information as it shall deem appropriate at the time, continue to make its own
credit analysis, appraisals and decisions in taking or not taking action under
this Agreement and the other Loan Documents, and to make such investigation as
it deems necessary to inform itself as to the business, operations, property,
financial and other condition and creditworthiness of Borrowers, Guarantor and
their respective Affiliates. Except for notices, reports and other documents
expressly required to be furnished to the Lenders by Agent hereunder or by the
other Loan Documents, Agent shall not have any duty or responsibility to provide
any Lender with any credit or other information concerning the business,
operations, property, financial and other condition or creditworthiness of the
Borrowers, Guarantor or any of their respective Affiliates which may come into
the possession of Agent or any of its respective officers, directors, employees,
agents, attorneys-in-fact, subsidiaries or affiliates.

         11.6 Indemnification. Lenders agree to reimburse and indemnify Agent
(in its capacity as Agent but not as a Lender) ratably in proportion to their
respective Commitments (i) for any amounts (but excluding syndication expenses)
not reimbursed by Borrowers for which Agent is entitled to reimbursement by
Borrowers under the Loan Documents (and without limiting the obligation of
Borrowers to pay such reimbursement), including reasonable out-of-pocket
expenses in connection with the preparation, execution, delivery of the Loan
Documents, (ii) for any other reasonable out-of-pocket expenses incurred by
Agent, on behalf of Lenders, in connection with the administration and
enforcement of the Loan Documents and (iii) for any liabilities, obligations,
losses, damages, penalties, actions, judgments, suits, costs, expenses or
disbursements of any kind and nature whatsoever which may at any time
(including, without limitation, at any time following the payment of the Notes)
be imposed on, incurred by or asserted against Agent in any way relating to or
arising out of this Agreement or the other Loan Documents, or any documents
contemplated by or referred to herein or therein or the transactions
contemplated hereby or thereby or any action taken or omitted by Agent under or
in connection with any of the foregoing; provided that no Lender shall be liable
for any of the foregoing to the extent they arise from (a) the gross negligence
or willful misconduct of Agent or (b) a dispute which is solely between Agent
and one or more Lenders in which the other Lender prevails, or (c) an action
taken or not taken by Agent contrary to the express requirements contained
herein pertaining to the requisite number of Lenders required to approve or
direct certain actions or contrary to the instructions received from such
Lenders. The obligations of Lenders under this Section 11.6 shall survive
payment of the Indebtedness and termination of this Agreement. Each Lender
shall, within ten (10) Business Days after a written demand therefor accompanied
with a description of the amounts payable, contribute its respective Pro-Rata
Share of the out-of-pocket costs and expenses incurred by Agent in accordance
with the terms of this Agreement, including, but not limited to, fees of
receivers or trustees, court costs, title company charges, filing and recording
fees, appraisers' fees and reasonable fees and expenses of attorneys.

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<PAGE>

         11.7 Consequential Damages. NOTWITHSTANDING ANYTHING TO THE CONTRARY
HEREIN OR IN ANY OF THE LOAN DOCUMENTS, NEITHER AGENT NOR ANY LENDER SHALL BE
RESPONSIBLE OR LIABLE TO ANY LENDER OR TO AGENT FOR ANY PUNITIVE, EXEMPLARY OR
CONSEQUENTIAL DAMAGES WHICH MAY BE ALLEGED AS A RESULT OF THIS AGREEMENT, THE
OTHER LOAN DOCUMENTS OR ANY OF THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY.

         11.8 Agent in Its Individual Capacity. Agent and its respective
subsidiaries and affiliates may make loans to, accept deposits from and
generally engage in any kind of business with Borrowers as though Agent were not
an Agent hereunder. With respect to any Loans, Letter of Credit Advances and
Swing Line Loans made or renewed by it and any Line of Credit Note or Swing Line
Note issued to it, the Agent shall have the same rights and powers under this
Agreement and the other Loan Documents as any Lender and may exercise the same
as though it were not an Agent, and the terms "Lender" and "Lenders" shall
include Agent in its individual capacity.

         11.9 Resignation or Removal of Agent as Administrative Agent. Subject
to the appointment and acceptance of a successor administrative agent as
provided below, (i) Agent may resign at any time by giving sixty (60) days'
written notice thereof to Lenders and Master Borrower, and (ii) Agent may be
removed at any time by Requisite Lenders with cause, if it is reasonably
determined by Requisite Lenders that Agent has failed, and continues to fail, in
the administration of the Facility in accordance with customary practices for
similar credit facilities. Upon any such resignation or removal, Requisite
Lenders shall have the right to appoint a successor Agent, subject to the
approval of Borrowers, which approval shall not be unreasonably withheld or
delayed; provided, however, that no such approval of Borrowers shall be required
if an Event of Default is in existence. If no successor administrative agent
shall have been so appointed by Requisite Lenders and shall have accepted such
appointment within sixty (60) days after the retiring Agent's notice of
resignation or the Requisite Lenders' removal of the retiring Agent, then the
retiring Agent may, on behalf of Lenders, appoint a successor administrative
agent, subject to the approval of Borrowers, which approval shall not be
unreasonably withheld or delayed; provided, however, that no such approval of
Borrowers shall be required if an Event of Default is in existence. Any
successor administrative agent shall be a Lender which has a combined capital
and surplus of at least $250,000,000.00. Upon the acceptance of any appointment
as Agent hereunder by a successor administrative agent, such successor
administrative agent shall thereupon succeed to and become vested with all the
rights, powers, privileges and duties of the retiring Agent, and the retiring
Agent shall be discharged from its duties and obligations hereunder. After any
retiring Agent's resignation or removal hereunder as Agent, the provisions of
this Article XI shall continue in effect for its benefit in respect of any
actions taken or omitted to be taken by it while it was acting as Agent
hereunder.



                                       55
<PAGE>

         11.10 Amendments, Waivers and Consents. Except as set forth below, any
term, covenant, agreement or condition of this Agreement or any of the other
Loan Documents may be amended or waived by the Lenders, and any consent given by
the Lenders, if, but only if, such amendment, waiver or consent is in writing
signed by the Requisite Lenders (or by Agent with the consent of the Requisite
Lenders) and delivered to Agent and, in the case of an amendment, signed by the
Borrowers; provided, that without the prior written consent of each Lender no
amendment, waiver or consent shall: (i) increase the Facility Amount, the
Revolving Sublimit or the Letter of Credit Sublimit, (ii) postpone the Maturity
Date or change the date on which any monthly payment of interest is due; (iii)
reduce the Interest Rate payable on any Loan or Letter of Credit Advance, or any
Loan Fee; (iv) amend the "Advance Rate" percentage set forth in the chart that
is part of Section 3.3; (v) permit any assignment (other than as specifically
permitted or contemplated in this Agreement) of any of the Borrowers' rights and
obligations hereunder; (vi) release Guarantor; (vii) release any Collateral or
consent to the transfer, pledge, mortgage or assignment of any Collateral, other
than as specifically provided in this Agreement; or (viii) amend the provisions
of this Section 11.10, the definition of Requisite Lenders or any other
provision of this Agreement specifying the number or percentage of Lenders
required to (a) amend, waive or otherwise modify any rights of Lenders
hereunder, (b) make any determination that is to be made by Lenders or (c) grant
any consent that is required to be obtained from Lenders. In addition, no
amendment or waiver of the provisions of this Article XI shall be made without
the written consent of Agent and no Lender's Commitment may be increased without
such Lender's consent.

         11.11 Authority.

              11.11.1 Agent, as described herein, shall have all rights with
respect to collection and administration of the Indebtedness, the security
therefor and the exercise of remedies with respect thereto, except, to the
extent otherwise expressly set forth herein. Lenders agree that Agent shall make
all determinations as to whether to grant or withhold approvals or consents
under the Loan Documents and as to compliance with the terms and conditions of
the Loan Documents, except to the extent otherwise expressly set forth therein
or herein. Agent will simultaneously deliver to Lenders copies of any default
notice sent to Borrowers under the terms of the Loan Documents and will promptly
provide to Lenders copies of any other material notices.

              11.11.2 As to any matters which are subject to the consent of any
or all of Lenders, as set forth in this Agreement, Agent shall not be permitted
or required to exercise any discretion or to take any action except upon the
receipt of the written consent to such action by Lenders holding the required
Pro-Rata Shares, which written instructions shall be binding upon Lenders.
Notwithstanding anything contained herein to the contrary, it is understood and
agreed that Lenders' right to consent to or disapprove any particular matter
shall be limited to the extent that Lenders' or Agent's rights to consent to or
disapprove of such matter are limited in the Loan Documents. Subject to the
foregoing limitations, each Lender hereby appoints and constitutes Agent as its
agent with full power and authority to exercise on behalf of such Lender any and
all rights and remedies which such Lender may have with respect to, and to the
extent necessary under applicable law for, the enforcement of the Loan
Documents, including the right to exercise, or to refrain from exercising, any
and all remedies afforded to such Lender by the Loan Documents or which such
Lender may have as a matter of law.

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<PAGE>

         11.12 Borrower Default. Agent shall not be deemed to have knowledge of
the occurrence of a default or an Event of Default (other than the nonpayment of
principal of or interest on the Loans, Letter of Credit Advances or Swing Line
Loans) unless Agent has received notice from a Lender, a Borrower or Guarantor
specifying such default or Event of Default and stating that such notice is a
"Notice of Default". In the event that Agent receives such a notice of the
occurrence of a default or an Event of Default, Agent shall give prompt notice
thereof to Lenders. Agent shall give each Lender prompt notice of each
nonpayment of principal of or interest on the Loans, Letter of Credit Advances
or Swing Line Loans, whether or not Agent has received any notice of the
occurrence of such nonpayment. Agent shall (subject to Section 11.10) take such
action hereunder with respect to such default or Event of Default as shall be
directed by Requisite Lenders, provided that, unless and until Agent shall have
received such directions, Agent may (but shall not be obligated to) take such
action, or refrain from taking such action, with respect to such default or
Event of Default as it shall deem advisable in the best interests of Lenders,
including, without limitation, continuing to make Loans.

         11.13 Lender Default. If any Lender (a "DEFAULTING LENDER") fails to
fund its Pro Rata Share of any Loan or Letter of Credit Advance on or before the
time required pursuant to this Agreement, or fails to pay Agent, within twenty
(20) days of demand (which demand shall be accompanied by invoices or other
reasonable back up information demonstrating the amount owed) for such Lender's
Pro Rata Share of any out-of-pocket costs, expenses or disbursements incurred or
made by Agent pursuant to the terms of this Agreement (the aggregate amount
which the Defaulting Lender fails to pay or fund is referred to as the
"Defaulted Amount"), then, in addition to the rights and remedies that may be
available to the other Lenders (the "Non-Defaulting Lenders") at law and in
equity:

              11.13.1 The Defaulting Lender's right to participate in the
administration of the Loan and the Loan Documents, including without limitation,
any rights to vote upon, consent to or direct any action of Agent or Lenders
shall be suspended and such rights shall not be reinstated unless and until such
default is cured (and all decisions, except the decision to remove Agent, which
are subject to receiving a vote of a required percentage of Lenders shall be
approved if voted in favor of by the required percentage of the Non-Defaulting
Lenders), provided, however, that if Agent is a Defaulting Lender, Agent shall
continue to have all rights provided for in this Agreement with respect to the
administration of the Loan, unless Requisite Lenders vote to remove and replace
such Agent as provided in Section 11.9.

              11.13.2 Any or all of the Non-Defaulting Lenders shall be entitled
(but shall not be obligated) to fund the Defaulted Amount, and collect interest
at the Default Rate on the Defaulted Amount from the Defaulting Lender (after
crediting all interest actually paid by Borrower on the Defaulted Amount from
time to time) from amounts otherwise payable to the Defaulting Lender for the
period from the date on which the payment was due until the date on which
payment is made.

              11.13.3 In the event the Defaulted Amount is funded by any
Non-Defaulting Lenders pursuant to Section 11.13.2, the Defaulting Lender's
interest in the Loans and Letter of Credit Advances and the Loan Documents and
proceeds thereof shall be subordinated to any Defaulted Amount funded by any
Non-Defaulting Lenders pursuant to Section 11.13.2 plus interest which may be
due in accordance with Section 11.13.2, to be applied pari passu among the
Non-Defaulting Lenders funding the Defaulted Amount), without necessity for
executing any further documents, provided that such Defaulting Lender's interest
in the Loans and the Loan Documents and the proceeds thereof shall no longer be
so subordinated if the Defaulted Amount funded by the Non-Defaulting Lenders
(and all interest which has accrued pursuant to Section 11.13.2) shall be repaid
in full.

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<PAGE>

              11.13.4 To achieve such subordination, (i) Agent shall deduct from
the interest due to the Defaulting Lender on its subordinated interest in the
Loans and Letter of Credit Advances the excess of interest on the Defaulted
Amount at the rate specified in Section 11.13.2 over the interest actually
received from Borrower by the Non-Defaulting Lenders which funded the Defaulted
Amount on account of their portion of the Defaulted Amount for the same time
period and (ii) all amounts received by Agent on account of principal (or
reimbursement for amounts otherwise advanced) which would otherwise be payable
to the Defaulting Lender shall be paid pari passu to the Non-Defaulting Lenders
until the Defaulted Amount and all interest thereon has been repaid in full.

              11.13.5 Agent or any Lender shall have the right, with Agent's
consent and in Agent's sole discretion (but shall have no obligation) to
purchase from any Defaulting Lender, and such Defaulting Lender agrees that it
shall, upon Agent's request, sell and assign to Agent or such Lender or Lenders,
all of the Commitment of such Defaulting Lender for an amount equal to the
principal balance of the Note held by the Defaulting Lender and all accrued
interest and fees, less any amounts due from the Defaulting Lender with respect
thereto through the date of sale, such purchase and sale to be consummated
pursuant to an executed Assignment and Assumption Agreement.


         Nothing contained in this Section 11.13 shall be deemed or construed to
waive, diminish or limit, or prevent or estop any Lender from exercising or
enforcing, any rights or remedies which may be available at law or in equity as
a result of or in connection with any default under this Agreement by a Lender.
In addition, no Lender shall be deemed to be a Defaulting Lender if such Lender
refuses to fund its Pro Rata Share of any Loan or Letter of Credit Advance being
made after any bankruptcy related Event of Default hereof due to the lack of
bankruptcy court approval for such Advance.

         11.14 Ratable Sharing. The Lenders, by acceptance of a Note, agree
among themselves that with respect to all amounts received by them which are
applicable to the payment of or reduction of a proportion of the aggregate
amount of principal and interest due with respect to the Notes held by any
Lender (whether as a result of the enforcement of any Loan Document or on
foreclosure of any banker's or other lien or any setoff or other claim on or
against any deposit or other balance of any Borrower or Guarantor held by any
Lender) which is greater than the proportion received by any other holder of a
Note in respect to the aggregate amount of principal and interest due with
respect to the Notes held by it, or any other amount payable hereunder, such
Lender or such holder of a Note receiving such proportionately greater payments
shall notify each other Lender and Agent of such receipt and remit to them such
amounts as are necessary so that all such recoveries of principal and interest
with respect to the Notes shall be proportionate to the Lenders' respective Pro
Rata Shares. If any Lender or holder of a Note receiving such proportionately
greater payments is required to return such proportionately greater payment to
any trustee, receiver or other representative of or for any Borrower upon or by
reason of the bankruptcy, insolvency, reorganization or dissolution of such
Borrower, then such other Lender(s) which received its or their Pro Rata Share
of such proportionately greater payment must also return such amounts to the
appropriate Borrower as if such payment or payments from the Lender receiving
such proportionately greater payments had not been made. If at the time that the
provisions of this Section 11.14 are applied there is any Swing Line Loan
outstanding, each Lender's Pro Rata Share shall be appropriately adjusted to
reflect the existence of such Swing Line Loan and shall be based on such
Lender's proportionate share of all then-outstanding Indebtedness.



                                       58
<PAGE>

         11.15 Documentation. Agent shall deliver to any Lender, in addition to
the information required to be delivered by Agent to Lenders pursuant to this
Agreement, copies of such Loan Documents now or hereafter executed by Borrowers
or Guarantor and other documents delivered by Borrowers to Agent, promptly after
receipt of a written request therefore.

           ARTICLE XII. PARTICIPATION BY LENDERS IN SWING LINE LOANS.

         12.1 Purchase and Sale of Participation. In the event that any Swing
Line Loan is not paid in full on or before the third (3rd) Business Day after
the Swing Line Loan was made (either by Borrowers or by the application of the
proceeds of a Loan), Swing Line Lender shall give notice thereof to each Lender
and, effective upon delivery of such notice and without any further act by any
party, Swing Line Lender shall be deemed to have sold to each Lender, and each
Lender shall be deemed to have purchased from Swing Line Lender, an undivided
participation interest in such Swing Line Loan in the amount thereof that is
equal to the purchasing Lender's Pro Rata Share. If Swing Line Lender's notice
to the other Lenders is delivered before 2:00 p.m. on a Business Day, the
purchasing Lenders shall pay to Agent, by wire transfer of funds to the account
specified in Section 2.12.3.2 above on or before 4:00 p.m. on such day, the
purchasing Lender's Pro Rata Share of the subject Swing Line Loan. If Swing Line
Lender's notice is delivered to the other Lenders after 2:00 p.m., such payment
by the purchasing Lenders shall be made on the next Business Day after delivery
of such notice. The date on which such payment is due by the purchasing Lenders
is referred to herein as the "Participation Date." The sale by Swing Line Lender
of each participation interest in each subject Swing Line Loan shall be without
recourse or warranty in any event, except that Swing Line Lender warrants that
it shall hold unencumbered title to each interest in a Swing Line Loan that is
sold pursuant to this Section 12.1.

         12.2 Sharing of Interest and Expenses. All interest paid by Borrowers
with respect to a participated Swing Line Loan on account of the period prior to
the relevant Participation Date, regardless of when such payment is received,
shall be retained by Swing Line Lender. All other payments of interest and
payments of principal received by Swing Line Lender shall be allocated to the
Lenders in accordance with their respective Pro Rata Shares and shall be paid
over to the participating Lenders at the times and in the manner provided in
Section 2.6. with respect to Loans. All costs incurred by Swing Line Lender
that, had they been incurred by Agent or the Lenders with respect to a Loan
would be Lenders' Costs, shall also be Lenders' Costs and shall be payable by
Borrowers as elsewhere provided in this Agreement.

         12.3 Assignment of Participation Interests. No Lender may assign to any
Person such Lender's participation interest in any Swing Line Loan, except that
if a Lender assigns to an Eligible Investor such Lender's entire interest in the
Facility and the Loan Documents in accordance with the terms of this Agreement,
such Lender shall, concurrently with such assignment, assign to such Eligible
Investor all of the assigning Lender's right, title and interest in, to and
under the assigning Lender's interests in all Swing Line Loans.



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<PAGE>

         12.4 Administration of Swing Line Loans. Agent shall administer, in
accordance with the terms, all Swing Line Loans that are subject to
participation interests as provided in this Article XII. The enforcement of each
such participated Swing Line Loan shall be governed by the provisions of Article
XI.

                          ARTICLE XIII. MISCELLANEOUS

         13.1 Modifications. Modifications, waivers or amendments of or to the
provisions of this Agreement or any other Loan Document shall be effective only
if set forth in a written instrument signed by each of the parties to the
subject document.

         13.2 Binding Nature. The rights and privileges of Agent and Lenders
contained in this Agreement shall inure to the benefit of their respective
successors and permitted assigns, and the duties of the Borrowers shall bind all
successors and permitted assigns. All agreement, representations, warranties and
covenants made by the Borrowers herein or in any of the other Loan Documents
shall survive the execution and delivery of this Agreement and all other
documents referred to herein and shall be continuing as long as any portion of
any Indebtedness owed to Lenders hereunder shall remain outstanding and unpaid.

         13.3 Governing Law. This Agreement and all of the other Loan Documents
shall in all respects be governed by the laws of the Commonwealth of
Pennsylvania. This Agreement and all of the other Loan Documents shall be
construed as if drafted equally by all parties hereto.

         13.4 Time of Performance. Time of performance hereunder is of the
essence of this Agreement.

         13.5 Severability. If any provision hereof shall for any reason be held
invalid or unenforceable, no other provision shall be affected thereby, and this
Agreement shall be construed as if the invalid or unenforceable provision had
never been a part of it.

         13.6 Captions. The descriptive headings hereof are for convenience only
and shall not in any way affect the meaning or construction of any provision
hereof.

         13.7 Computations. Except as otherwise expressly stated herein, all
computations required herein shall be made by the application of generally
accepted accounting principles and practices applied on a consistent basis.

         13.8 Continuing Obligation. If any claim is ever made upon any Lender
for the repayment or return of any money or property received by such Lender
from any Borrower in payment of the Loan or any other Obligation and such Lender
repays or returns all or part of said money or property by reason of (i) any
judgment, decree or order of any court or administrative body having
jurisdiction over such Lender or any of its property or (ii) any settlement or
compromise of any such claim accomplished by such Lender with such claimant,
then in such event Borrowers agree that any such judgment, decree, settlement or
compromise shall be binding upon Borrowers, notwithstanding any termination
hereof or the cancellation of any note or other instrument evidencing any
liability to such Lender, and the Borrowers shall be and shall remain liable to
such Lender hereunder for the amount so repaid or the value of the property
returned to the same extent as if such had never originally been received by
such Lender. Borrowers agree that no Lender shall have any duty or affirmative
obligation to defend against such claim and may object to or pay such claim in
its sole discretion without impairing or relinquishing the obligations of
Borrowers hereunder. This Section 13.8 shall survive the termination of this
Agreement.



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<PAGE>

         13.9 Assignment and Participation.

              13.9.1 Each Lender may, with the consent of Borrowers (so long as
no Default or Event of Default has occurred and is continuing) and the consent
of Agent, which consents shall not be unreasonably withheld, delayed or denied,
shall not be required if the assignee is another Lender or is an Affiliate of
the assigning Lender and, as to Borrowers, shall be sufficiently given if given
by Master Borrower alone on behalf of all Borrowers, assign to one or more
Eligible Investor all or a portion of the assigning Lender's interests, rights
and obligations under this Agreement (including, without limitation, all or a
portion of the Loans and Letter of Credit Advances at the time owing to it and
the Line of Credit Note held by it), provided that:

                  13.9.1.1 Each such assignment, if of less than all of the
assigning Lender's Commitment, shall not be less than $10,000,000 and, if
greater, an integral multiple of $1,000,000.

                  13.9.1.2 If an assignment is of less than all of the assigning
Lender's Commitment, such Lender shall retain a commitment of at least
$10,000,000.

                  13.9.1.3 The parties to each such assignment shall complete,
execute and deliver to the Agent, for its acceptance and recording in the
Register, an Assignment and Acceptance in the form of Exhibit 13.9 attached
hereto (an "Assignment and Acceptance"), together with the Line of Credit Note
subject to such assignment.

                  13.9.1.4 Such assignment shall not, without the consent of the
Borrowers, require any Borrower to file a registration statement with the
Securities and Exchange Commission or apply to or qualify the Loans or the Line
of Credit Note under the blue sky laws of any state.

                  13.9.1.5 Unless the assignee is an Affiliate of the assigning
Lender, the assigning Lender shall pay, or cause the assignee to pay, to Agent
an assignment fee of $3,500 upon the execution by such Lender of the Assignment.

              13.9.2 Upon execution, delivery, acceptance and recording, from
and after the effective date specified in each Assignment and Acceptance, which
effective date shall be at least five (5) Business Days after the execution
thereof, (i) the assignee thereunder shall be a party hereto and, to the extent
provided in such Assignment and Acceptance, have the rights and obligations of a
Lender hereby, and (ii) the Lender thereunder shall, to the extent provided in
such assignment, be released from its obligations under this Agreement. By
executing and delivering an Assignment and Acceptance, the assigning Lender
thereunder and the assignee thereunder confirm to and agree with each other and
the other parties hereto as set forth in such Assignment and Acceptance.



                                       61
<PAGE>

              13.9.3 Agent shall maintain a copy of each Assignment and
Acceptance delivered to it and a register for the recordation of the names and
addresses of the Lenders and the amount of the Loans and Letter of Credit
Advances with respect to each Lender from time to time (the "REGISTER"). The
entries in the Register shall be conclusive, in the absence of manifest error,
and Borrowers, Agent and the Lenders may treat each person whose name is
recorded in the Register as a Lender hereunder for all purposes of this
Agreement. The Register shall be available for inspection by the Borrowers or
Lender at any reasonable time and from time to time upon reasonable prior
notice.

              13.9.4 Upon its receipt of an Assignment and Acceptance executed
by an assigning Lender and an Eligible Investor who has become an assignee
hereunder, together with the Line of Credit Notes subject to such assignment and
the written consent to such assignment, Agent shall, if such Assignment and
Acceptance has been completed:

                  13.9.4.1 Accept such Assignment and Acceptance;

                  13.9.4.2 Record the information contained therein in the
Register;

                  13.9.4.3 Give prompt notice thereof to the Lenders and the
Borrowers; and

                  13.9.4.4 Promptly deliver a copy of such Assignment and
Acceptance to Borrowers.

Within five (5) Business Days after receipt of notice, Master Borrower and each
other Borrower shall execute and deliver to the Agent, in exchange for the
surrendered Line of Credit Note, a new Note with all appropriate Joinders to the
order of such assignee in the amount equal to the Commitment assumed by it
pursuant to such Assignment and Acceptance and a new Line of Credit Note to the
order of the assigning Lender in the aggregate amount equal to the Commitment
(if any) retained by it hereunder. Such new Line of Credit Notes shall be in an
aggregate principal amount equal to the aggregate principal amount of such
surrendered Line of Credit Note, shall be dated the effective date of such
Assignment and Acceptance and shall otherwise be in substantially the form of
the Line of Credit Note previously delivered to the assigning Lender. The
surrendered Line of Credit Note shall be canceled and returned to Master
Borrower.

              13.9.5 Each Lender may sell participations to one or more Eligible
Investor in all or a portion of the selling Lender's rights and obligations
under this Agreement (including, without limitation, all or a portion of its
Loans and Letter of Credit Advances and the Line of Credit Note held by it);
provided that:

                  13.9.5.1 Each such participation shall be in an amount not
less than $10,000,000;

                  13.9.5.2 Such Lender's obligations under this Agreement
(including, without limitation, its Commitment) shall remain unchanged;



                                       62
<PAGE>

                  13.9.5.3 Such Lender shall remain solely responsible to the
other parties hereto for the performance of such obligation;

                  13.9.5.4 Such Lender shall remain the holder of the Line of
Credit Note held by it for all purposes of this Agreement;

                  13.9.5.5 Borrowers, Agent, and the other Lenders shall
continue to deal solely and directly with such Lender in connection with such
Lender's rights and obligations under this Agreement;

                  13.9.5.6 Such Lender shall not permit such participant the
right to approve any waivers, amendments or other modifications to this
Agreement or any other Loan Document other than waivers, amendments or
modifications which, by the terms of this Agreement, require the unanimous
approval of the Lenders.

              13.9.6 Master Borrower may, by written notice to Agent and any
Rejecting Lender, elect to require such Rejecting Lender to assign all, or any
portion that is $10,000,000 or, if greater, an integral multiple of $1,000,000,
of such Rejecting Lender's Commitment to any Lender or, with the consent of
Agent (which consent shall not unreasonably be withheld, delayed or denied), to
another Eligible Investor. In such event, the portion of the Rejecting Lender's
Commitment so designated shall be assigned by the Rejecting Lender to such
Lender or Eligible Investor in accordance with this Section 13.9 within ten (10)
Business Days after delivery of Master Borrower's notice to the Rejecting Lender
pursuant to this Section 13.9.6. If a Rejecting Lender shall be so required to
assign all of its Commitment, the Rejecting Lender shall continue to have the
benefit of all indemnities provided herein to the Lenders.

         13.10 Notices.

              13.10.1 All notices or other communications required or permitted
to be made upon any party hereunder shall be in writing and sent by (i) hand
delivery or (ii) national overnight express courier with written verification of
actual delivery or (iii) first-class, United States mail, postage prepaid,
registered or certified with return receipt requested, or (iv) when specifically
permitted by the terms of this Agreement, facsimile transmission or electronic
transmission (e-mail). Such notice shall be delivered or sent to the address set
forth below or at such other address of which either party shall have given the
other by notice in writing in accordance with the foregoing:

If to Master Borrower, any other
Borrower or Guarantor:                c/o Orleans Homebuilders, Inc.
                                      One Greenwood Square
                                      3333 Street Road
                                      Bensalem, Pennsylvania 19020
                                      Attention:  Joseph A. Santangelo, CFO
                                      Fax: 215-633-2352
                                      E-mail: jsantangelo@orleanshomes.com



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<PAGE>

with copies to:                       Lawrence J. Dugan, Esquire
                                      c/o Orleans Homebuilders, Inc.
                                      One Greenwood Square
                                      3333 Street Road
                                      Bensalem, Pennsylvania 19020
                                      Fax: 215-633-2352
                                      E-mail: ldugan@orleanshomes.com

                                                   and

                                      Jason M. Shargel, Esquire
                                      Wolf Block Schorr & Solis-Cohen LLP
                                      1650 Arch Street, 22nd Floor
                                      Philadelphia, Pennsylvania 19103
                                      Fax: 215-405-3816
                                      E-mail: jshargel@wolfblock.com

If to Agent (other than regarding     Wachovia Bank, National Association
fundings):                            123 S. Broad Street
                                      Philadelphia, Pennsylvania  19109
                                      Attention:  Julie Pasceri-Young, VP
                                      Fax: 215-670-6530
                                      E-mail: Julie.Pasceri-Young@wachovia.com

with copies to:                       Wachovia Bank, National Association
                                      Mail Code VA 7391
                                      P.O. Box 13327
                                      Roanoke, VA 24040

                                                   or

                                      10 South Jefferson Street
                                      Roanoke, VA 24011

                                                            and

                                      Kenneth I. Rosenberg, Esquire
                                      Schnader Harrison Segal & Lewis LLP
                                      1600 Market Street, Suite 3600
                                      Philadelphia, PA  19103-7286
                                      Fax:  215-751-2205
                                      E-mail:  krosenberg@schnader.com

If to Agent regarding fundings:       To Agent as provided in Section 2.12.2



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<PAGE>


If to Lenders:                        Wachovia Bank, National Association
                                      123 S. Broad Street
                                      Philadelphia, Pennsylvania  19109
                                      Attention:  Julie Pasceri-Young,
                                                  Vice President
                                      Fax: 215-670-6530
                                      E-mail:  julie.pasceri-young@wachovia.com

                                      AmSouth Bank
                                      1900 5th Avenue N., RCL/BAC-15
                                      Birmingham, AL  35203
                                      Attention:  Ronny Hudspeth
                                      Fax: 205-801-0138
                                      E-mail: rhudspeth@amsouth.com

                                      Comerica Bank
                                      500 Woodward Avenue, MC 3256
                                      Detroit, MI  48226
                                      Attention:  Adam J. Sheets
                                      Fax: 313-222-4718
                                      E-mail:  AJSheets@Comerica.com

                                      Compass Bank
                                      15 So. 20th Street, 15th Floor
                                      Birmingham, AL  35233
                                      Attention: Johanna Duke Paley
                                      Fax: 205-297-7994
                                      E-mail: MJD@compassbnk.com

                                      Guaranty Bank
                                      8333 Douglas Avenue
                                      Dallas, TX 75225
                                      Attention: Linda Garcia
                                      Fax: 214-360-2624
                                      E-mail: linda.garcia@guarantygroup.com

                                      National City Bank
                                      One South Broad Street
                                      14th Floor
                                      Philadelphia, PA  19107-3304
                                      Attention: Brian D. Gallagher
                                      Fax: 267-256-4001
                                      E-mail: Brian.Gallagher@nationalcity.com



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<PAGE>

                                      Sovereign Bank
                                      Two Aldwyn Center
                                      P. O. Box 608 Route
                                      320 and Lancaster
                                      Avenue Villanova, PA
                                      19085 Attention: Sean
                                      Finnegan Fax:
                                      610-526-6201 E-mail:
                                      sfinnega@sovereignbank.com

                                      U.S. Bank National
                                      Association 209 S.
                                      LaSalle St, Ste 410
                                      MK-IL-RY4Q Chicago, IL
                                      60604 Attention: Brian
                                      Walsh Fax:
                                      312-325-8852 E-mail:
                                      Brian.walsh2@usbank.com

                                      Citizens Bank of Pennsylvania
                                      2001 Market Street 6th Floor
                                      Philadelphia, PA 19103
                                      Attention: Michael DiSanto
                                      Fax: 215-751-1542
                                      E-mail: Michael.DiSanto@citizensbank.com

                                      SunTrust Bank
                                      8330 Boone Boulevard 8th Floor
                                      Vienna, VA 22182
                                      Attention: W. John Wendler
                                      Fax: 703-442-1570
                                      E-mail: john.wendler@suntrust.com

                                      Manufacturers and Traders Trust Company
                                      601 Dresher Rd
                                      Horsham, PA 19044
                                      Attention: Bernard T. Shields
                                      Fax: 215-956-7074
                                      E-mail: Bshields@mandtbank.com

                                      Franklin Bank, SSB
                                      1730 Walton Road, Suite 304
                                      Blue Bell, PA 19422
                                      Attention: Virgil J. Haplea
                                      Fax: 610-567-0159
                                      E-mail: vhaplea@bankfranklin.com

                                       66
<PAGE>

                                      Firstrust Bank
                                      15 E. Ridge Pike
                                      Conshohocken, PA 19428
                                      Attention:  Gary S. Kinn, Vice President
                                      Fax:  610-238-5065
                                      E-mail:  gkinn@firstrust.com

                                      Commerce Bank, N.A.
                                      100 E. DeKalb Pike
                                      King of Prussia, PA 19406
                                      Attention: Joseph Rago
                                      Fax: 610-321-2696
                                      E-mail: jrago@yesbank.com

                                      Bank of America, N.A.
                                      4 Sentry Parkway
                                      Suite 200
                                      Blue Bell, PA 19422
                                      Attention:  Craig P. Adams
                                      Fax: 610-825-3328
                                      E-mail: craig.p.adams@bankofamerica.com

                                      JPMorgan Chase Bank, N.A.
                                      131 S. Dearborn - 5th Floor
                                      Chicago, IL  60603
                                      Attention:  Jennifer Kelley
                                      Phone:  312-325-5014
                                      Fax:  312-325-5172
                                      E-mail: jennifer.s.kelley@chase.com

                                      LaSalle Bank National Association
                                      5950 Sherry Lane, Suite 540
                                      Dallas, TX 75225
                                      Attention:  Nathan Weyer
                                      Phone:  214-360-5004
                                      Fax:  214-360-5001
                                      E-mail:  nathan.weyer@abnamro.com

                                      Deutsche Bank Trust Company Americas
                                      60 Wall Street - MS NYC 60 - 1104
                                      New York, New York  10005
                                      Attention:  Scottye Lindsey
                                      Fax:  212-797-5692
                                      E-mail:  scottye.d.lindsey@db.com



                                       67
<PAGE>

              13.10.2 Notices given to Master Borrower shall be deemed to have
been given to all of the Borrowers, notwithstanding that any such notice is
addressed only to Master Borrower.

              13.10.3 Notice sent by overnight courier or mailed in accordance
with the foregoing shall be effective three (3) Business Days following deposit,
or sooner upon receipt. Notice given in any other manner permitted herein shall
be effective only if and when received by the addressee.

              13.10.4 Notice given to any party by the attorney for another
party shall constitute notice from such party (and the attorneys for each party
are hereby permitted to give such notice to each other party on behalf of their
client). Failure to provide copies of any notice to counsel as provided above
shall not invalidate or limit the effect of such notice.

         13.11 Cumulative Remedies. The rights and remedies provided hereunder
are cumulative and not exclusive of any rights or remedies (including without
limitation, the right of specific performance) which Agent or Lenders would
otherwise have. Any waiver, consent or approval of any kind or character on the
part of Agent or Lenders of any Event of Default or breach of this Agreement or
any Loan Document or any such waiver of any provision or condition hereof or
thereof must be in writing, signed by Agent, and shall be effective only to the
extent in such writing specifically set forth. Borrowers acknowledge that, with
respect to this Agreement and its terms, Borrowers are neither authorized nor
entitled to rely on any representations, course of dealing, modifications or
assurances in any form as to any subject from any officer of Agent unless and
until such representations, modifications, course of dealing, or assurances are
set forth in writing and signed by such officer of Agent.

         13.12 Third Party Beneficiaries. The parties do not intend the benefits
of this Agreement to inure to any third party. Notwithstanding anything
contained herein or in the Notes or any other Loan Document executed in
connection with this transaction, or any conduct or course of conduct by either
or both of the parties hereto, or their respective Affiliates, agents, or
employees, before or after the signing of this Agreement or any of the other
aforesaid Loan Documents, this Agreement shall not be construed as creating any
rights, claims, or causes of action against Agent or any Lender, or any of their
respective officers, directors, agents, or employees, in favor of any person or
entity other than Borrowers.

         13.13 Prior Understandings. This Agreement and the Loan Documents
supersede all prior understandings and agreements, whether written or oral,
between the parties hereto and thereto relating to the transactions provided for
herein or therein.

         13.14 Counterparts. This Agreement may be executed in one or more
counterparts, each of which shall be deemed to be an original but all of which
together shall constitute one and the same instrument.

         13.15 Indemnification.

              13.15.1 Borrowers and, by its execution of the Guaranty, Guarantor
agree to indemnify and hold harmless Agent and Lenders and each of their
respective affiliates and each of their respective officers, directors,
employees, agents, advisors and representatives (each, an "INDEMNIFIED PARTY")
from and against any and all claims, damages, losses, liabilities and reasonable
expenses (including, without limitation, fees and disbursements of counsel),
joint or several, that may be incurred by or asserted or awarded against any


                                       68
<PAGE>

Indemnified Party, in each case arising out of or in connection with or relating
to any investigation, litigation or proceeding or the preparation of any defense
with respect thereto, arising out of or in connection with the Facility, any of
the Loan Documents or any of the transactions contemplated hereby or thereby, or
any use made or proposed to be made with the proceeds of the Facility, whether
or not such investigation, litigation or proceeding is brought by a Borrower,
Guarantor, any of its or their shareholders or creditors, an Indemnified Party
or any other Person, or an Indemnified Party is otherwise a party thereto,
except to the extent such claim, damage, loss, liability or expense is found in
a final, non-appealable judgment by a court of competent jurisdiction to have
resulted from such Indemnified Party's gross negligence or willful misconduct.


         No Indemnified Party shall have any liability (whether direct or
indirect, in contract, tort or otherwise) to any Borrower, Guarantor or any of
its or their shareholders or directors for or in connection with the
transactions contemplated hereto, except to the extent such liability is found
in a final, non-appealable judgment by a court of competent jurisdiction to have
resulted from such Indemnified Party's gross negligence or willful misconduct.

              13.15.2 Agent shall promptly give Borrowers written notice of all
suits or actions instituted against Lenders with respect to which Borrowers have
indemnified Lenders, and Borrowers shall timely proceed to defend any such suit
or action through counsel reasonably acceptable to Lenders. In the event that
Lenders determine in good faith that the subject action, if decided adversely to
Lenders' interest, would have a material adverse effect upon any Lender, Lenders
shall also have the right, at the expense of Borrowers, to participate in or, at
Lenders' election, assume the defense or prosecution of such suit, action, or
proceeding, and in the latter event Borrowers may employ counsel and participate
therein. Agent shall have the right to adjust, settle, or compromise any claim,
suit, or judgment after notice to Borrowers, unless Borrowers desire to litigate
such claim, defend such suit, or appeal such judgment and simultaneously
therewith deposit with Agent collateral security sufficient to pay any judgment
rendered, with interest, costs, legal fees and expenses; and the right of
Lenders to indemnification under this Agreement shall extend to any money paid
by Lenders in settlement or compromise of any such claims, suits, and judgments
in good faith, after notice to Borrowers.

              13.15.3 If any suit, action, or other proceeding is brought by
Lenders against Borrowers for breach of Borrowers' covenant of indemnity herein
contained, separate suits may be brought as causes of action accrue, without
prejudice or bar to the bringing of subsequent suits on any other cause or
causes of action, whether theretofore or thereafter accruing.

              13.15.4 The obligations of Borrowers and Guarantor under this
Section 13.15 shall survive the repayment of the Debt and termination of this
Agreement, and shall continue in full force and effect so long as the
possibility of such claim, action or suit exists. If, and to the extent that the
obligations of Borrowers or Guarantor under this Section 13.15 are unenforceable
for any reason, Borrowers and Guarantor hereby agree to make the maximum
contribution to the payment in satisfaction of such obligations which is
permissible under applicable law.

         13.16 Relationship of Parties. It is hereby acknowledged by Lenders and
Borrowers that the relationship between them created hereby and by the other
Loan Documents is that of creditor and debtor and is not intended to be and
shall not in any way be construed to be that of a partnership, a joint venture,
or principal and agent; and it is hereby further acknowledged that Agent's
disbursement of any Loan proceeds or Letter of Credit Advance to anyone other
than a Borrower shall not be deemed to make Agent or Lenders a partner, joint
venturer, or principal or agent of Borrowers, but rather shall be deemed to be
solely for the purpose of protecting Lenders' security for the Obligations. The
relationship between Agent and the Lenders is not intended by the parties to
create, and shall not create, any trust, joint venture or partnership relation
between or among them.



                                       69
<PAGE>

         13.17 Joint and Several Liability. The liability of each Person that
is, or by reason of its execution of a Joinder hereafter becomes, a Borrower for
(i) the performance of this Agreement and of each of the other Loan Documents
and (ii) for payment of the Indebtedness shall be joint and several.

         13.18 Publicity. Agent may, at its option and in such manner as it may
determine and which Master Borrower shall approve (such approval not to be
unreasonably withheld, delayed or conditioned), announce and publicize the
involvement of Agent and Lenders in the granting of the Facility.

         13.19 No Implied Waiver. No delay or failure of Agent or the Lenders in
exercising any right, power, or remedy hereunder shall operate as a waiver
thereof; nor shall any single or partial exercise thereof or any abandonment or
discontinuance of steps to enforce such a right, power or remedy preclude any
other or further exercise thereof or the exercise of any other right, power or
remedy.

         13.20 USA Patriot Act. Each Lender that is subject to the requirements
of the USA Patriot Act (Title III of Pub.L. 107-56) (signed into law October 26,
2001)) (the "Act") hereby notifies each Borrower that pursuant to the
requirements of the Act, it is required to obtain, verify and record information
that identifies Borrowers, which information includes the name and address of
each Borrower and other information that will allow such Lender to identify
Borrowers in accordance with the Act; Agent shall obtain such information on
behalf of the Lenders.

         13.21 Taxes. Borrowers agree to pay or cause to be paid any and all
stamp, document, transfer or recording taxes, and similar impositions payable or
hereafter determined to be payable in connection with the Notes, the Mortgages
or any other Loan Document, and agree to save Agent and the Lenders harmless
from and against any and all present or future claims or liabilities with
respect to, or resulting from, any delay in paying or omission to pay, any such
taxes or similar impositions.

         13.22 Conflict; Construction of Documents; Reliance. In the event of
any conflict between the provisions of this Loan Agreement and any of the other
Loan Documents, the provisions of this Loan Agreement shall control; provided,
that any provision of the Loan Documents which imposes additional burdens on
Borrowers or further restricts the rights of Borrowers or gives the Agent or
Lenders additional rights shall not be deemed to be in conflict or inconsistent
with this Agreement and shall be given full force and effect. The parties hereto
acknowledge that they were represented by competent counsel in connection with
the negotiation, drafting and execution of the Loan Documents and that the Loan
Documents shall not be subject to the principle of construing their meaning
against the party which drafted them. Each Borrower acknowledges that it has
read the entirety of this Agreement and of every other Loan Document and that
Borrowers shall rely solely on their own judgment and on their legal counsel and
advisors in entering into the Facility and executing the Loan Documents, without
relying in any manner on any statements, representations or recommendations of
Agent or any Lender or any parent, subsidiary or Affiliate of Agent or of any
Lender, or of any employee, officer, agent or advisor of any of the foregoing
entities.

                                       70
<PAGE>

         13.23 Jurisdiction. IN ANY LEGAL PROCEEDING INVOLVING, DIRECTLY OR
INDIRECTLY, ANY MATTER ARISING OUT OF OR RELATED TO THIS AGREEMENT OR ANY LOAN
DOCUMENT OR THE RELATIONSHIP EVIDENCED HEREBY, BORROWERS HEREBY IRREVOCABLY
SUBMIT TO THE NON-EXCLUSIVE JURISDICTION OF THE COURT OF COMMON PLEAS OF
PHILADELPHIA OR BUCKS COUNTY, PENNSYLVANIA, AND THE UNITED STATES DISTRICT COURT
FOR THE EASTERN DISTRICT OF PENNSYLVANIA. BORROWERS EXPRESSLY SUBMIT AND CONSENT
IN ADVANCE TO SUCH JURISDICTION IN ANY ACTION OR SUIT COMMENCED IN ANY SUCH
COURT, AND BORROWERS HEREBY WAIVE ANY OBJECTION WHICH BORROWERS MAY HAVE BASED
UPON LACK OF PERSONAL JURISDICTION, IMPROPER VENUE, OR FORUM NON CONVENIENS.
BORROWERS HEREBY WAIVE PERSONAL SERVICE OF THE SUMMONS, COMPLAINT AND ANY OTHER
PROCESS ISSUED IN ANY SUCH ACTION OR SUIT AND AGREES THAT SERVICE OF SUCH
SUMMONS, COMPLAINT, AND ANY OTHER PROCESS MAY BE MADE BY REGISTERED OR CERTIFIED
MAIL ADDRESSED TO BORROWERS AT THE ADDRESS SET FORTH ABOVE AND THAT SERVICE SO
MADE SHALL BE DEEMED COMPLETED UPON THE PROVIDING OF NOTICE IN ACCORDANCE WITH
THE TERMS HEREOF. NOTHING IN THIS AGREEMENT SHALL BE DEEMED OR OPERATE TO AFFECT
THE RIGHTS OF AGENT TO SERVE LEGAL PROCESS IN ANY OTHER MANNER PERMITTED BY LAW,
OR TO PRECLUDE THE ENFORCEMENT BY AGENT OR LENDERS OF ANY CLAIM, JUDGMENT OR
ORDER OBTAINED IN SUCH FORUM, OR THE TAKING OF ANY ACTION UNDER THIS AGREEMENT
OR OTHERWISE TO ENFORCE SAME, IN ANY OTHER APPROPRIATE FORUM OR JURISDICTION.

         13.24 Waiver of Jury Trial. BORROWERS, AGENT AND LENDER, AFTER
CONSULTATION WITH THEIR RESPECTIVE COUNSEL, EACH HEREBY WAIVE ANY RIGHT WHICH
THEY MAY HAVE TO A JURY TRIAL IN CONNECTION WITH ANY LEGAL PROCEEDING INVOLVING,
DIRECTLY OR INDIRECTLY, ANY MATTER (WHETHER SOUNDING IN TORT, CONTRACT OR
OTHERWISE) COMMENCED BY OR AGAINST THEM OR ANY OF THEM IN ANY WAY ARISING OUT OF
OR RELATED TO THIS AGREEMENT, ANY LOAN DOCUMENT OR THE TRANSACTIONS CONTEMPLATED
BY THIS AGREEMENT, OR IN ANY WAY PERTAINING TO THE FACILITY OR THE RELATIONSHIPS
EVIDENCED BY THIS AGREEMENT.

         13.25 Counterparts. This Agreement may be executed in any number of
counterparts and by different parties hereto in separate counterparts, each of
which when so executed shall be deemed to be an original and shall be binding
upon all parties, their successors and assigns, and all of which taken together
shall constitute one and the same agreement.

                                       71
<PAGE>

         13.26 Entire Agreement. This Agreement, the other Loan Documents and
the Fee Letter referred to in Section 2.6.1 contain the entire agreement and
understanding among Borrowers, Lenders and Agent regarding the Facility. All
prior negotiations and discussions between or among any of the parties hereto
regarding the Facility and the terms and conditions thereof are superseded by
this Agreement, the other Loan Documents, and such Fee Letter.

         13.27 Original Credit Agreement; No Novation. This Agreement
supercedes, amends and restates in full, the Original Credit Agreement and all
prior amendments thereof. The Indebtedness referred to herein includes all of
the Indebtedness outstanding pursuant to the Original Credit Agreement
immediately prior to the execution of this Agreement, and the parties
acknowledge and agree that this Agreement is not intended to, nor shall it,
constitute a novation. All Notes issued and outstanding pursuant to the Original
Credit Agreement (including all replacement Notes) constitute Notes issued
pursuant to, and shall have the benefit of, this Agreement. Borrowers
acknowledge agree that all references in any Loan Document heretofore executed
by any Borrower to the "Loan Agreement" mean and refer to the Original Credit
Agreement, as amended and restated by this Agreement.



                          [REMAINDER OF PAGE IS BLANK]











                                       72
<PAGE>


IN WITNESS WHEREOF, the parties hereto have executed this Agreement under seal
the day and year set forth above.

Master Borrower:                             Greenwood Financial, Inc., a
                                             Delaware corporation

                                             By:     Joseph A. Santangelo
                                                     ---------------------------
                                                     Joseph A. Santangelo
                                                     Vice President

 Corporate Borrowers:                        Masterpiece Homes, Inc.
                                             OHB Homes, Inc.
                                             Orleans Corporation
                                             Orleans Corporation of New Jersey
                                             Orleans Construction Corp.
                                             Parker & Lancaster Corporation
                                             Parker & Orleans Homebuilders, Inc.
                                             Sharp Road Farms, Inc.

                                             By:     Joseph A. Santangelo
                                                     ---------------------------
                                                     Joseph A. Santangelo
                                                     Vice President

Limited Liability Company
Borrowers:                                   Kabro of Middletown, LLC
                                             OPCNC, LLC
                                             Orleans at Bordentown, LLC
                                             Orleans at Cooks Bridge, LLC
                                             Orleans at Covington Manor, LLC
                                             Orleans at Crofton Chase, LLC
                                             Orleans at East Greenwich, LLC
                                             Orleans at Elk Township, LLC
                                             Orleans at Evesham, LLC
                                             Orleans at Hamilton, LLC
                                             Orleans at Harrison, LLC
                                             Orleans at Lambertville, LLC
                                             Orleans at Lyons Gate, LLC
                                             Orleans at Mansfield, LLC
                                             Orleans at Maple Glen, LLC
                                             Orleans at Meadow Glen, LLC
                                             Orleans at Millstone, LLC
                                             Orleans at Millstone River
                                             Preserve, LLC
                                             Orleans at Moorestown, LLC
                                             Orleans at Tabernacle, LLC
                                             Orleans at Upper Freehold, LLC

                         [Borrowers' signatures continued on the following page]


                                       73
<PAGE>


                                       Orleans at Westampton Woods, LLC
                                       Parker Lancaster, Tidewater, LLC

                                       By:     Joseph A. Santangelo
                                               ---------------------------------
                                               Joseph A. Santangelo
                                               Vice President
Limited Partnership
Borrowers:                             Brookshire Estates, L.P. (f/k/a
                                       Orleans at Brookshire Estates, L.P.)
                                       Orleans at Falls, LP
                                       Orleans at Limerick, LP
                                       Orleans at Lower Salford, LP
                                       Orleans at Upper Saucon, L.P.
                                       Orleans at Upper Uwchlan, LP
                                       Orleans at West Bradford, LP
                                       Orleans at West Vincent, LP
                                       Orleans at Windsor Square, LP
                                       Stock Grange, LP
                                       By:     OHI PA GP, LLC, sole General
                                               Partner

                                               By: Joseph A. Santangelo
                                                   -----------------------------
                                                   Joseph A. Santangelo
                                                   Vice President

                                       Realen Homes, L.P.
                                       By: RHGP, LLC, sole General Partner
                                               By:  Orleans Homebuilders, Inc.,
                                                    Authorized Member

                                               By: Joseph A. Santangelo
                                                    ----------------------------
                                                   Joseph A. Santangelo
                                                   Chief Financial Officer

Guarantor:                             Orleans Homebuilders, Inc., a Delaware
                                       corporation

                                               By: Joseph A Santangelo
                                                   -----------------------------
                                                   Joseph A. Santangelo
                                                   Chief Financial Officer


Agent:                                 Wachovia Bank, National Association

                                               By: Jeffrey D. Wallace
                                                   -----------------------------
                                                   Jeffrey D. Wallace
                                                   Senior Vice President

                         [Lenders' signatures continued on the following pages]



                                       74
<PAGE>



                                 LENDER SIGNATURE PAGE TO AMENDED AND RESTATED
                                 REVOLVING CREDIT LOAN AGREEMENT WITH GREENWOOD
                                 FINANCIAL, INC. AS MASTER BORROWER, DATED AS
                                 OF JANUARY 24, 2006:


                                 WACHOVIA BANK,
                                 NATIONAL ASSOCIATION


                                 By:  Jeffrey D. Wallace
                                      --------------------
                                      Jeffrey D. Wallace, Senior Vice President



                                       75
<PAGE>


                                 LENDER SIGNATURE PAGE TO AMENDED AND RESTATED
                                 REVOLVING CREDIT LOAN AGREEMENT WITH GREENWOOD
                                 FINANCIAL, INC. AS MASTER BORROWER, DATED AS
                                 OF JANUARY 24, 2006:


                                 BANK OF AMERICA, N.A.


                                 By: Craig P. Adams
                                     ---------------
                                     Name:Craig P. Adams
                                     Title:Senior Vice President



                                       76
<PAGE>



                                 LENDER SIGNATURE PAGE TO AMENDED AND RESTATED
                                 REVOLVING CREDIT LOAN AGREEMENT WITH GREENWOOD
                                 FINANCIAL, INC. AS MASTER BORROWER, DATED AS
                                 OF JANUARY 24, 2006:


                                 SOVEREIGN BANK


                                 By: Sean Finnegan
                                     ---------------
                                     Name: Sean Finnegan
                                     Title: Vice Presidnt



                                       77
<PAGE>


                                 LENDER SIGNATURE PAGE TO AMENDED AND RESTATED
                                 REVOLVING CREDIT LOAN AGREEMENT WITH GREENWOOD
                                 FINANCIAL, INC. AS MASTER BORROWER, DATED AS
                                 OF JANUARY 24, 2006:


                                 MANUFACTURERS AND TRADERS TRUST COMPANY


                                 By: Bernard T. Shields
                                     -------------------
                                 Name: Bernard T. Shields
                                 Title: Vice President



                                       78
<PAGE>





                                 LENDER SIGNATURE PAGE TO AMENDED AND RESTATED
                                 REVOLVING CREDIT LOAN AGREEMENT WITH GREENWOOD
                                 FINANCIAL, INC. AS MASTER BORROWER, DATED AS
                                 OF JANUARY 24, 2006:


                                 NATIONAL CITY BANK


                                 By: Brian Gallagher
                                     ----------------
                                     Name: Brian Gallagher
                                     Title:   Vice President



                                       79
<PAGE>


                                 LENDER SIGNATURE PAGE TO AMENDED AND RESTATED
                                 REVOLVING CREDIT LOAN AGREEMENT WITH GREENWOOD
                                 FINANCIAL, INC. AS MASTER BORROWER, DATED AS
                                 OF JANUARY 24, 2006:


                                 FIRSTRUST BANK


                                 By: Gary S. Kinn
                                     -------------
                                     Name: Gary S. Kinn
                                     Title:   Vice President




                                       80
<PAGE>


                                 LENDER SIGNATURE PAGE TO AMENDED AND RESTATED
                                 REVOLVING CREDIT LOAN AGREEMENT WITH GREENWOOD
                                 FINANCIAL, INC. AS MASTER BORROWER, DATED AS
                                 OF JANUARY 24, 2006:


                                 GUARANTY BANK


                                 By: Linda Garcia
                                     ------------
                                     Name: Linda Garcia
                                     Title:   Senior Vice President



                                       81
<PAGE>

                                 LENDER SIGNATURE PAGE TO AMENDED AND RESTATED
                                 REVOLVING CREDIT LOAN AGREEMENT WITH GREENWOOD
                                 FINANCIAL, INC. AS MASTER BORROWER, DATED AS
                                 OF JANUARY 24, 2006:


                                 U.S. BANK NATIONAL ASSOCIATION


                                 By: Brian M. Walsh
                                     ---------------
                                     Name: Brian M. Walsh
                                     Title:  Senior Vice President




                                       82
<PAGE>

                                 LENDER SIGNATURE PAGE TO AMENDED AND RESTATED
                                 REVOLVING CREDIT LOAN AGREEMENT WITH GREENWOOD
                                 FINANCIAL, INC. AS MASTER BORROWER, DATED AS
                                 OF JANUARY 24, 2006:


                                 CITIZENS BANK OF PENNSYLVANIA


                                 By: Michael DiSanto
                                     ---------------
                                     Name: Michael DiSanto
                                     Title:   Senior Vice President



                                       83
<PAGE>


                                 LENDER SIGNATURE PAGE TO AMENDED AND RESTATED
                                 REVOLVING CREDIT LOAN AGREEMENT WITH GREENWOOD
                                 FINANCIAL, INC. AS MASTER BORROWER, DATED AS
                                 OF JANUARY 24, 2006:


                                 COMMERCE BANK, N.A.


                                 By: Joseph Rago
                                     ------------
                                     Name: Joseph Rago
                                     Title:Vice President


                                       84
<PAGE>

                                 LENDER SIGNATURE PAGE TO AMENDED AND RESTATED
                                 REVOLVING CREDIT LOAN AGREEMENT WITH GREENWOOD
                                 FINANCIAL, INC. AS MASTER BORROWER, DATED AS
                                 OF JANUARY 24, 2006:


                                 SUNTRUST BANK


                                 By: W. John Wendler
                                     ---------------
                                     Name: W. John Wendler
                                     Title:   Senior Vice President



                                       85
<PAGE>

                                 LENDER SIGNATURE PAGE TO AMENDED AND RESTATED
                                 REVOLVING CREDIT LOAN AGREEMENT WITH GREENWOOD
                                 FINANCIAL, INC. AS MASTER BORROWER, DATED AS
                                 OF JANUARY 24, 2006:


                                 AMSOUTH BANK


                                 By: Ronny Hudspeth
                                     ---------------
                                     Name: Ronny Hudspeth
                                     Title:   Senior Vice President



                                       86
<PAGE>


                                 LENDER SIGNATURE PAGE TO AMENDED AND RESTATED
                                 REVOLVING CREDIT LOAN AGREEMENT WITH GREENWOOD
                                 FINANCIAL, INC. AS MASTER BORROWER, DATED AS
                                 OF JANUARY 24, 2006:


                                 FRANKLIN BANK, SSB


                                 By: Virgil J. Haplea
                                     ----------------
                                     Name: Virgil J. Haplea
                                     Title:   Senior Vice President


                                       87
<PAGE>


                                 LENDER SIGNATURE PAGE TO AMENDED AND RESTATED
                                 REVOLVING CREDIT LOAN AGREEMENT WITH GREENWOOD
                                 FINANCIAL, INC. AS MASTER BORROWER, DATED AS
                                 OF JANUARY 24, 2006:

                                 COMERICA BANK


                                 By: Adam Sheets
                                     -----------
                                     Name: Adam Sheets
                                     Title:   Account Officer



                                       88
<PAGE>


                                 LENDER SIGNATURE PAGE TO AMENDED AND RESTATED
                                 REVOLVING CREDIT LOAN AGREEMENT WITH GREENWOOD
                                 FINANCIAL, INC. AS MASTER BORROWER, DATED AS
                                 OF JANUARY 24, 2006:


                                 COMPASS BANK, an Alabama Banking Corporation


                                 By: Johanna Duke Paley
                                     ------------------
                                     Name: Johanna Duke Paley
                                     Title:   Senior Vice President







                                       89
<PAGE>


                                 LENDER SIGNATURE PAGE TO AMENDED AND RESTATED
                                 REVOLVING CREDIT LOAN AGREEMENT WITH GREENWOOD
                                 FINANCIAL, INC. AS MASTER BORROWER, DATED AS
                                 OF JANUARY 24, 2006:


                                 JPMORGAN CHASE BANK, N.A.


                                 By: Jennifer S. Kelley
                                     ------------------
                                     Name: Jennifer S. Kelley
                                     Title:   First Vice President



                                       90
<PAGE>


                                 LENDER SIGNATURE PAGE TO AMENDED AND RESTATED
                                 REVOLVING CREDIT LOAN AGREEMENT WITH GREENWOOD
                                 FINANCIAL, INC. AS MASTER BORROWER, DATED AS
                                 OF JANUARY 24, 2006:



                                 LaSALLE BANK, N.A.


                                 By: Leticia Ruiz
                                     ------------
                                     Name: Leticia Ruiz
                                     Title:   First Vice President



                                       91
<PAGE>

                                 LENDER SIGNATURE PAGE TO AMENDED AND RESTATED
                                 REVOLVING CREDIT LOAN AGREEMENT WITH GREENWOOD
                                 FINANCIAL, INC. AS MASTER BORROWER, DATED AS
                                 OF JANUARY 24, 2006:



                                 DEUTSCHE BANK TRUST COMPANY AMERICAS


                                 By: Scottye Lindsey
                                     ---------------
                                     Name: Scottye Lindsey
                                     Title:   Director

                                 By: Lana Gifas
                                     ----------
                                     Name: Lana Gifas
                                     Title:   Vice President


                                       92








<PAGE>


                                  Exhibit 1.1C

                                 Form of Joinder


                  This Joinder and Assumption Agreement ("this Joinder"), made
as of the ____ day of ___________, 200_, by and among ___________________
("Lender"), GREENWOOD FINANCIAL, INC., a Delaware corporation ("Master
Borrower") and _________________________, a ____________________________
("Additional Borrower").


                              W I T N E S S E T H:

                  A. Lender, Master Borrower, Wachovia Bank, National
Association ("Agent") and others are parties to an Amended and Restated
Revolving Credit Loan Agreement dated as of January 24, 2006 (as thereafter from
time to time amended, the "Loan Agreement"). All capitalized terms used but not
specifically defined herein have the meanings defined in the Loan Agreement.

                  B. Pursuant to the Loan Agreement, Master Borrower and certain
Eligible Affiliates executed and delivered to Lender [a Line of Credit Note in
the principal amount equal to Lender's Pro Rata Share of the Facility] [the
Swing Line Note] (the "Note").

                  C. Additional Borrower is an Eligible Affiliate.

                  D. Pursuant to the Loan Agreement, Master Borrower and
Additional Borrower desire that Additional Borrower become a Borrower under the
terms and conditions of the Loan Agreement and enjoy the rights and benefit of,
and assume the liabilities and obligations undertaken by, a Borrower under the
terms of the Loan Agreement and Note.

                  E. Agent and Lender are willing to accept Additional Borrower
as a Borrower under the Loan Agreement and the Note.

                  F. Concurrently with the execution of this Joinder, Additional
Borrower is executing a joinder and assumption agreement in favor of each of the
other "Lenders" (as defined in the Loan Agreement) with respect to the "Notes"
(as defined in the Loan Agreement) that are held by them.

                  NOW, THEREFORE, for good and valuable consideration, the
receipt and sufficiency of which are acknowledged, and intending to be legally
bound hereby, the parties hereto agree as follows:

                  1. Agent (by its execution of its consent hereto), Lender,
         Master Borrower and Additional Borrower hereby agree that Additional
         Borrower shall hereafter be deemed to be a "Borrower" under the terms
         of the Loan Agreement and the Note and shall enjoy all of the rights
         and benefits as such that are available under the terms of the Loan
         Agreement and the Note.
<PAGE>

                  2. Additional Borrower hereby assumes all of the obligations
         and liabilities of a "Borrower" under the terms of the Loan Agreement
         and agrees to be bound by the terms and conditions thereof. Additional
         Borrower hereby assumes and agrees to pay, jointly and severally with
         Master Borrower and all other Borrowers, all of the Indebtedness
         heretofore or hereafter arising under the Loan Agreement or under the
         Note, as if Additional Borrower had been a signatory, as a Borrower, to
         the Loan Agreement and the Note.

                  3. Additional Borrower hereby releases Lender and said
         attorney or attorneys from all procedural error, defects and
         imperfections whatsoever in entering judgment by confession hereon as
         aforesaid or in issuing any process or instituting any proceedings
         relating thereto.

                  4. ADDITIONAL BORROWER HEREBY WAIVES, AND LENDER BY ITS
         ACCEPTANCE HEREOF THEREBY WAIVES, TRIAL BY JURY IN ANY LEGAL PROCEEDING
         INVOLVING, DIRECTLY OR INDIRECTLY, ANY MATTER (WHETHER SOUNDING IN
         TORT, CONTRACT OR OTHERWISE) IN ANY WAY ARISING OUT OF OR RELATED TO
         THE NOTE, THE LOAN AGREEMENT OR THE RELATIONSHIP EVIDENCED HEREBY AND
         THEREBY. THIS PROVISION IS A MATERIAL INDUCEMENT FOR PAYEE TO ENTER
         INTO, ACCEPT OR RELY UPON THIS JOINDER AND ACKNOWLEDGMENT AGREEMENT,
         THE NOTE AND THE LOAN AGREEMENT.

                  5. The remedies of Lender provided herein, in the Loan
         Agreement, in any other Loan Document or otherwise available to Lender
         at law or in equity, and the warrant of attorney contained herein,
         shall be cumulative and concurrent, and may be pursued singly,
         successively and together at the sole discretion of Lender, and may be
         exercised as often as occasion therefor shall occur; and the failure to
         exercise any such right or remedy shall in no event be construed as a
         waiver or release of the same. Except as specifically modified hereby,
         the Loan Agreement and Note continue in full force and effect, in
         accordance with their respective terms. Nothing in this Agreement shall
         affect any of the obligations or liabilities of Master Borrower or any
         other Borrower, as set forth in the Loan Agreement or the Note.

                  6. Agent is intended to be a third party beneficiary of this
         Joinder, to the extent that Additional Borrower has assumed and agreed
         to pay the obligations of Master Borrower and the other Borrowers under
         the Loan Agreement.

                  IN WITNESS WHEREOF, the parties hereto have executed this
Joinder and Assumption Agreement as of the day and year first above written.

                             LENDER:



                             By:
                                  -------------------------------------
                                  Name:
                                  Title:


                                       2
<PAGE>


                             ORIGINAL BORROWER:


                             GREENWOOD FINANCIAL, INC., a Delaware corporation


                             By:
                                  -------------------------------------
                                  Name:
                                  Title:


                             ADDITIONAL BORROWER:

                                                     , a
                             ------------------------    -----------------------

                             By:
                                  -------------------------------------
                                  Name:
                                  Title:



                                       3
<PAGE>



                              CONSENT OF GUARANTOR


                  The undersigned, being the Guarantor of the obligations of the
Borrowers under the aforesaid Loan Agreement and Note, hereby consents to the
foregoing Joinder and Assumption Agreement and agrees that nothing therein shall
affect the liability of Guarantor under the terms of the Guaranty to which
reference is made in the Loan Agreement.

                  IN WITNESS WHEREOF, Guarantor has executed this Consent of
Guarantor on this _____ day of __________, 200_.


                  ORLEANS HOMEBUILDERS, INC., a Delaware corporation



                  By:
                     -------------------------------------
                     Joseph A. Santangelo
                     Chief Financial Officer


                                CONSENT OF AGENT


                  Wachovia Bank, National Association, as Agent pursuant to the
aforesaid Loan Agreement, hereby approves Additional Borrower as a Borrower that
is entitled to the benefits of the Loan Agreement.


                  Wachovia Bank, National Association

                  By:
                     -------------------------------------
                     Name:
                     Title:




<PAGE>



                                  Exhibit 1.1E

                           Form of Line of Credit Note


                                 PROMISSORY NOTE
                                                      Philadelphia, Pennsylvania

$_________________                                              January __, 2006


         1. FOR VALUE RECEIVED, GREENWOOD FINANCIAL, INC., a Delaware
corporation and each of the other entities executing this promissory note
(herein referred to as "Borrowers") promise, jointly and severally with all
other Persons that hereafter become a Borrower pursuant to the Loan Agreement,
to pay to the order of _______________________ ("Lender"), on or before the
Maturity Date, __________ Million _________ Hundred __________ Thousand Dollars
($___________), in lawful money of the United States of America and in
immediately available funds. All initially capitalized terms that are used
herein but are not defined herein shall have the same meanings ascribed to them
in the Amended and Restated Revolving Credit Loan Agreement, dated the date
hereof by and among Borrowers, Wachovia Bank, National Association, as agent,
Lender, and the other financial institutions that are party thereto (as from
time to time hereafter amended, the "Loan Agreement") unless the context clearly
requires to the contrary. This promissory note is referred to herein as "this
Note".

         2. Borrowers also promise so to pay interest on the unpaid principal
amount of Lender's Pro Rata Share of all Loans and Letter of Credit Advances
from the Funding Date thereof to maturity (whether by acceleration or otherwise)
at the Interest Rate in effect from time to time.

         3. Interest shall be payable on the Loans and Letter of Credit
Advances, in arrears, through the last day of each month, with the first payment
to be made on February 15, 2006, and continuing thereafter on the 15th day of
each month and at maturity.

         4. In the event that the unpaid principal amount of this Note shall
become due and payable in full, whether at stated maturity, by acceleration or
otherwise, such principal amount and all other sums that are due or owed by
Borrowers to Lender under this Note or any other Loan Document shall thereafter
bear interest payable upon demand at the Default Rate in effect from time to
time.

         5. This Note is one of the Line of Credit Notes referred to in the Loan
Agreement and is issued subject and pursuant to, and entitled to the benefits
of, the Loan Agreement, to which reference is hereby made for a more complete
statement of the terms and conditions pertaining to Lender's Pro Rata Share of
the Loans and Letter of Credit Advances evidenced hereby on which this Note and
the other Line of Credit Notes were made and are to be repaid. All recoveries by
Lender under this Note or otherwise are subject to the provisions of Article XI
of the Loan Agreement.
<PAGE>

         6. All payments of principal and interest in respect of this Note shall
be made by Borrowers without defense, setoff or counterclaim in immediately
available funds and delivered to Agent not later than 1:00 p.m. (prevailing
Eastern time) on the date due by wire transfer of immediately available funds to
Agent's account as provided in Section 2.12.3.2 of the Loan Agreement. Funds
received by Agent after that time shall be deemed to have been paid by the
Borrowers on the next succeeding Business Day.

         7. Whenever any payment on this Note shall be stated to be due on a day
which is not a Business Day, such payment shall be made on the next succeeding
Business Day and such extension of time shall be included in the computation of
the payment of interest on this Note.

         8. Borrowers may prepay all or any portion of the outstanding principal
balance hereof subject to the terms, conditions and limitations of the Loan
Agreement (including the limitation contained in Section 2.7.1 of the Loan
Agreement) and shall make mandatory prepayments of this Note in accordance with
the provisions of the Loan Agreement.

         9. The liabilities and obligations of Borrowers hereunder (i) shall be
joint and several, (ii) shall be unconditional without regard to the liability
or obligations of any other party other than Lender and (iii) shall not be in
any manner affected by any indulgence whatsoever granted or consented to by
Lender, including, but without being limited to, any extension of time, renewal,
waiver or other modification. Any failure of Lender to exercise any right
hereunder shall not be construed as a waiver of the right to exercise the same
or any other right at any time and from time to time thereafter.

         10. Each Borrower hereby releases Lender and said attorney or attorneys
from all procedural error, defects and imperfections whatsoever in entering
judgment by confession hereon as aforesaid or in issuing any process or
instituting any proceedings relating thereto.

         11. The remedies of Lender provided herein, in any other Loan Document
or otherwise available to Lender at law or in equity shall be cumulative and
concurrent, and may be pursued singly, successively and together at the sole
discretion of Lender, and may be exercised as often as occasion therefor shall
occur; and the failure to exercise any such right or remedy shall in no event be
construed as a waiver or release of the same.

         12. Borrowers hereby waive all benefit that might accrue to Borrowers
by virtue of any present or future laws exempting any property, real or
personal, or any part of the proceeds arising from any sale of any such
property, from attachment, levy or sale under execution, or providing for any
stay of execution, exemption from civil process or extension of time, and agrees
that such property may be sold to satisfy any judgment entered on this Note or
on any other Loan Document, in whole or in part and in any order as may be
desired by Lender.

         14. This Note shall be governed as to its validity, interpretation and
effect by the internal laws of the Commonwealth of Pennsylvania for contracts
made and to be performed in Pennsylvania.

                                       2
<PAGE>

         15. IN ANY LEGAL PROCEEDING INVOLVING, DIRECTLY OR INDIRECTLY, ANY
MATTER ARISING OUT OF OR RELATED TO THIS NOTE OR THE RELATIONSHIP EVIDENCED
HEREBY, EACH BORROWER HEREBY IRREVOCABLY SUBMITS TO THE NON-EXCLUSIVE
JURISDICTION OF ANY STATE OR FEDERAL COURT LOCATED IN OR SERVING PHILADELPHIA OR
BUCKS COUNTY, PENNSYLVANIA. EACH BORROWER EXPRESSLY SUBMITS AND CONSENT IN
ADVANCE TO SUCH JURISDICTION IN ANY ACTION OR SUIT COMMENCED IN ANY SUCH COURT,
AND EACH BORROWER HEREBY WAIVES ANY OBJECTION WHICH SUCH BORROWER MAY HAVE BASED
UPON LACK OF PERSONAL JURISDICTION, IMPROPER VENUE, OR FORUM NON CONVENIENS.
EACH BORROWER HEREBY WAIVES PERSONAL SERVICE OF THE SUMMONS, COMPLAINT AND ANY
OTHER PROCESS ISSUED IN ANY SUCH ACTION OR SUIT AND AGREE THAT SERVICE OF SUCH
SUMMONS, COMPLAINT, AND ANY OTHER PROCESS MAY BE MADE BY REGISTERED OR CERTIFIED
MAIL ADDRESSED TO SUCH BORROWER AT THE ADDRESS SET FORTH IN THE LOAN AGREEMENT
AND THAT SERVICE SO MADE SHALL BE DEEMED COMPLETED UPON THE PROVIDING OF NOTICE
IN ACCORDANCE WITH THE TERMS HEREOF. NOTHING IN THIS NOTE SHALL BE DEEMED OR
OPERATE TO AFFECT THE RIGHTS OF AGENT OR ANY LENDER TO SERVE LEGAL PROCESS IN
ANY OTHER MANNER PERMITTED BY LAW, OR TO PRECLUDE THE ENFORCEMENT BY AGENT OR
ANY LENDER OF ANY CLAIM, OR ANY JUDGMENT OR ORDER OBTAINED IN SUCH FORUM, OR THE
TAKING OF ANY ACTION UNDER THIS AGREEMENT OR OTHERWISE TO ENFORCE SAME, IN ANY
OTHER APPROPRIATE FORUM OR JURISDICTION.

         16. Borrowers hereby waive presentment, demand for payment, notice of
dishonor or acceleration, protest or notice of protest and any and all notices
or demands in connection with the delivery, acceptance, performance, default or
enforcement of this Note.

         17. Upon the occurrence of an Event of Default, the unpaid balance of
the principal amount of this Note, together with all accrued but unpaid interest
thereon, and Lender's Pro Rata Share of all other Indebtedness may become, or
may be declared to be, due and payable in the manner, upon the conditions and
with the effect provided in the Loan Agreement.

         18. The terms of this Note may not be changed or amended orally but
only by an agreement in writing and signed by all Lenders, or by such other
number of Lenders as all Lenders may determine from time to time.

         19. Borrowers promise to pay all costs and expenses, including
reasonable attorneys' fees, as provided in Section 1.5 of the Loan Agreement,
incurred in the collection and enforcement of this Note. Borrowers and all
endorsers of this Note hereby consent to renewals and extensions of time at or
after the maturity hereof, without notice, and hereby waive diligence,
presentment, protest, demand and notice of every kind and, to the full extent
permitted by law, the right to plead any statute of limitations as a defense to
any demand hereunder.

         20. EACH BORROWER HEREBY WAIVES, AND LENDER BY ITS ACCEPTANCE HEREOF
THEREBY WAIVES, TRIAL BY JURY IN ANY LEGAL PROCEEDING INVOLVING, DIRECTLY OR
INDIRECTLY, ANY MATTER (WHETHER SOUNDING IN TORT, CONTRACT OR OTHERWISE) IN ANY
WAY ARISING OUT OF OR RELATED TO THIS NOTE OR THE RELATIONSHIP EVIDENCED HEREBY.
THIS PROVISION IS A MATERIAL INDUCEMENT FOR PAYEE TO ENTER INTO, ACCEPT OR RELY
UPON THIS NOTE.

                                       3
<PAGE>

         21. If any provision of this Note shall for any reason be held to be
invalid or unenforceable, such invalidity or unenforceability shall not affect
any other provision hereof, but this Note shall be construed as if such invalid
or unenforceable provision had never been contained herein.

         22. IF APPLICABLE This Note is a replacement for the Note dated
December 22, 2004, executed and delivered to Lender pursuant to the Original
Credit Agreement (the "Prior Note"). The Indebtedness evidenced by this Note is
[PART OF] the same Indebtedness that was evidenced by the Prior Note, does not
constitute a novation or new indebtedness to Lender, and is entitled to all of
the security for the Prior Note heretofore given by Borrowers pursuant to the
Original Credit Agreement.

         IN WITNESS WHEREOF, each Borrower has caused this Note to be executed
and delivered by its duly authorized officer or other representative as of the
day and year and at the place first above written.

                             GREENWOOD FINANCIAL, INC., a Delaware corporation


                             By:
                                  -------------------------------------
                                  Name:
                                  Title:


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

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

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

                             By:
                                  -------------------------------------
                                  Name:            , as        of each
                                       ------------     ------
                                  Borrower identified above



                                       4
<PAGE>



                                  Exhibit 1.1F

                          Notice of Borrowing of a Loan


Wachovia Bank, National Association
201 S. College Street, 8th Floor
Charlotte, NC  28288-5758
Attn:  Syndication Agency Services
                                                             ____________, 200__
Gentlemen:

         This Notice of Borrowing ("Notice") is provided to Wachovia Bank,
National Association ("Agent") to evidence the request of ____________________
("Requesting Borrower"), to borrow funds in the form of a Loan, pursuant to the
Amended and Restated Revolving Credit Loan Agreement, dated as of January 24,
2006, by and among Requesting Borrower, Greenwood Financial, Inc., Agent, the
Lenders and certain other Affiliates of Requesting Borrower identified therein
(the "Loan Agreement"). All capitalized terms not defined herein shall have the
same meaning as provided in the Loan Agreement unless the context clearly
requires to the contrary.

         Requesting Borrower desires to borrow $__________ as a Loan on
______________, 200__ (the "Funding Date"). This Notice is provided to Lender by
11:00 a.m. at least two (2) Business Days prior to the Funding Date.

         The undersigned hereby certifies that: (i) the representations and
warranties contained in Article V of the Loan Agreement are true and correct as
of the date hereof, except to the extent such representations and warranties
relate to an earlier date or except for changes therein which have been
disclosed to Agent in writing and (ii) no Event of Default under the Loan
Agreement has occurred and is continuing.

                             [Requesting Borrower]

                             By:
                                  -------------------------------------
                                            , Vice President



<PAGE>


                       Notice of Borrowing of a Swing Loan


Wachovia Bank, National Association
201 S. College Street, 8th Floor
Charlotte, NC  28288-5758
Attn:  Syndication Agency Services
                                                             ____________, 200__
Gentlemen:

         This Notice of Borrowing ("Notice") is provided to Wachovia Bank,
National Association ("Agent") to evidence the request of ____________________
("Requesting Borrower"), to borrow funds in the form of a Swing Line Loan,
pursuant to the Amended and Restated Revolving Credit Loan Agreement, dated as
of January 24, 2006, by and among Requesting Borrower, Greenwood Financial,
Inc., Agent, the Lenders and certain other Affiliates of Requesting Borrower
identified therein (the "Loan Agreement"). All capitalized terms not defined
herein shall have the same meaning as provided in the Loan Agreement unless the
context clearly requires to the contrary.

         Requesting Borrower desires to borrow $__________ as a Swing Line Loan
on ______________, 200__ (the "Funding Date"). This Notice is provided to Lender
by 2:00 p.m. of the Funding Date.

         The undersigned hereby certifies that: (i) the representations and
warranties contained in Article V of the Loan Agreement are true and correct as
of the date hereof, except to the extent such representations and warranties
relate to an earlier date or except for changes therein which have been
disclosed to Agent in writing and (ii) no Event of Default under the Loan
Agreement has occurred and is continuing.

                             [Requesting Borrower]

                             By:
                                  -------------------------------------
                                            , Vice President



<PAGE>


                                 EXHIBIT 2.1.4.2

       APPLICATION AND AGREEMENT FOR IRREVOCABLE STANDBY LETTER OF CREDIT
                TO: WACHOVIA BANK, NATIONAL ASSOCIATION ("BANK")


Please TYPE Information in the fields below. We reserve the right to return
illegible applications for clarification.

<TABLE>
<CAPTION>
<S>              <C>                          <C>
---------------- ------------------------- |  --------------------------------------------------------------------------------------
Date:                                      |           The undersigned Applicant hereby requests Bank to issue and transmit by:
                                           |  [ ] Overnight Carrier   [ ] Teletransmission   [ ] Mail   [ ] Other:
                                           |
                                           |  Explain:_____
---------------- ------------------------- |  --------------------------------------------------------------------------------------
L/C No.                                    |           an Irrevocable Standby Letter of Credit (the "Credit") substantially as set
                                           |  forth below. In issuing the Credit, Bank is expressly authorized to make
                                           |  such changes from the terms herein below set forth as it, in its sole
                                           |  discretion, may deem advisable.
                 (Bank Use Only)           |
---------------- ------------------------- |  --------------------------------------------------------------------------------------

-------------------------------------------------------- | -------------------------------------------------------------------------
Application (Full Name & Address)                        | Advising Bank (Designate name & address only if desired)
                                                         |
                                                         |
-------------------------------------------------------- | -------------------------------------------------------------------------
Beneficiary (Full Name & Address)                        | Currency and Amount in Figures:
                                                         | -------------------------------------------------------------------------
                                                         | Currency and Amount in Words:
                                                         |
-------------------------------------------------------- | -------------------------------------------------------------------------
                                                         | Expiration Date:
------------------------------------------------------------------------------------------------------------------------------------
Charges:  Wachovia's charges are for our account; all other banking charges are to be paid by beneficiary.
------------------------------------------------------------------------------------------------------------------------------------

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

Credit to be available for payment against Beneficiary's draft(s) at sight drawn on Bank or its correspondent at Bank's
option accompanied by the following documents:

[ ]  Statement, purportedly signed by the Beneficiary, reading as follows (please state below exact wording to appear on the
     statement):

[ ]  Other Documents


[ ]  Special Conditions (including, if Applicant has a preference, selection of UCP as herein defined or ISP98 as herein defined.)


[ ]  Issue substantially in form of attached specimen. (Specimen must also be signed by applicant.)
------------------------------------------------------------------------------------------------------------------------------------
</TABLE>


                                       1
<PAGE>


--------------------------------------------------------------------------------
Complete only when the Beneficiary (Foreign Bank, or other Financial
Institution) is to issue its undertaking based on this Credit.
[ ] Request Beneficiary to issue and deliver their (specify type of undertaking)
_____________ in favor of _____________ for an amount not exceeding the amount
specified above, effective immediately relative to (specify contract number or
other pertinent reference) _____________ to expire on _____________. (This date
must be at least 15 days prior to expiry date indicated above.) It is understood
that if the Credit is issued in favor of any bank or other financial or
commercial entity which has issued or is to issue an undertaking on behalf of
the Applicant of the Credit in connection with the Credit, the Applicant hereby
agrees to remain liable under this Application and Agreement in respect of the
Credit (even after its stated expiry date) until Bank is released by such bank
or entity.
--------------------------------------------------------------------------------

Each Applicant signing below affirms that it has fully read and agrees to this
Application and the attached Continuing Letter of Credit Agreement. In
consideration of the Bank's issuance of the Credit, the Applicant agrees to be
bound by the agreement set forth In this and in the following pages (even if the
following pages are not attached to the Application) delivered to the Bank.
(Note: If a bank, trust company, or other financial institution signs as
Applicant or joint and several co-Applicant for its customer, or if two
Applicants jointly and severally apply, both parties sign below). Documents may
be forwarded to the Bank by the beneficiary, or the negotiating bank, in one
mail. Bank may forward documents to Applicants customhouse broker, or Applicant
if specified above, in one mail. Applicant understands and agrees that this
Credit will be subject to the Uniform Customs and Practice for Documentary
Credits of the International Chamber of Commerce currently in effect, and in use
by Bank ("UCP") or to the International Standby Practices of the International
Chamber of Commerce, Publication 590 or any subsequent version currently in
effect and in use by Bank ("ISP98").



-------------------------------------      -------------------------------------
   (Print or type name of Applicant)          (Print or type name of Applicant)


-------------------------------------      -------------------------------------
               (Address)                                  (Address)

-------------------------------------      -------------------------------------
     Authorized Signature (Title)               Authorized Signature (Title)

-------------------------------------      -------------------------------------
     Authorized Signature (Title)               Authorized Signature (Title)

Customer Contact:                          Phone:
                  ---------------------          -------------------------------

<TABLE>
<CAPTION>
<S>                                                                <C>
----------------------------------------------------------------------------------------------------------------------------------
                                                            BANK USE ONLY
                               NOTE: Application will NOT be processed if this section is not complete
------------------------------------------------------------------ | -------------------------------------------------------------
Approved (Authorized Signature)                                    | Date:
                                                                   |
                                                                   |
------------------------------------------------------------------ | -------------------------------------------------------------
Approved (Print name and title)                                    | City:
                                                                   |
--------------------------- -------------------------------------- | -------------------------------------------------------------
Customer SIC Code:          Borrower Default Grade:                | Telephone:
                                                                   |
--------------------------- ------------- ------------------------ | ------------------------------ ------------------------------
Charge DDA #:               Fee:          RC #:                    | CLAS Bank #:                   CLAS Obligor #:
                                                                   |
--------------------------- ------------- ------------------------ ----------------------------- ---------------------------------

              (ATTACHED ARE THE IRREVOCABLE STANDBY LETTER OF CREDIT AGREEMENT TERMS AND CONDITIONS.)

</TABLE>
                                       2
<PAGE>

                      CONTINUING LETTER OF CREDIT AGREEMENT

         In consideration of the Bank (as defined below) in its discretion
issuing from time to time letters of credit whether documentary or standby and
all amendments thereto (hereinafter each individually, and all collectively
called the "Credit") substantially in accordance with an Application (as defined
below) for a Credit tendered to the Bank the undersigned (hereinafter,
individually and collectively, the "Applicant") agrees:

         1. DEFINITIONS. As used herein: (A) "AGREEMENT" means each Application
by the Applicant for a Credit and this Continuing Letter of Credit Agreement, as
each may be modified; (B) "APPLICATION" means, if Applicant uses electronic
communication facilities to apply for or instruct the Bank as to the contents of
a Credit, information sufficient to enable the Bank to prepare and issue or
amend a Credit for Applicant's account transmitted by electronic message (which
may, but need not, be computer generated), including facsimile, directed to the
Bank by Applicant using such identification codes, passwords, and other security
procedures as the Bank and Applicant may agree are commercially reasonable from
time to time; or a written and signed application with sufficient information
delivered to the Bank to enable it to prepare and issue or amend a Credit for
Applicant's account; (C) "BANK" means Wachovia Bank, National Association and
all of its branches, whether in the United States or foreign and any of Bank's
affiliates that issue letters of credit; Applicant authorizes and directs the
Bank to select the branch or affiliate which will issue or process any Credit;
and for the purposes of Sections 4, 7 and 9, "Bank" includes correspondents of
Bank; (D) "BUSINESS DAY" means any day that is not a Saturday, Sunday or other
day on which commercial banks are authorized or required to close at the place
where Bank is obligated to honor a presentation or otherwise act under the
Credit or this Agreement; (E) "COLLATERAL" means all Applicant's Property (as
hereinafter defined) now or hereafter in possession or control of Bank or its
agents, affiliates or representatives (for any purpose) or in transit to or from
Bank; (F) "DRAFT" means any draft (sight or time), receipt, acceptance, cable,
SWIFT or other written demand for payment; (G) "EVENT OF DEFAULT" means (i)
failure to pay or perform any of the Obligations when due or (ii) the occurrence
of any "Event of Default" as defined in the Revolving Credit Loan Agreement
dated December 22, 2004, among Applicant, Bank, certain affiliates of Applicant
and other financial institutions (as the same may be amended from time to time,
the "LOAN AGREEMENT") ; (H) "GOOD FAITH" means honesty in fact in the conduct or
transaction concerned; (I) "ISP 98" means the International Standby Practices,
International Chamber of Commerce ("ICC") Publication No. 590, or any subsequent
revisions or restatement thereof which may be adopted by the ICC and in use by
the Bank; (J) "JURISDICTION" means the state in the United States where the
Bank's branch which maintains Applicant's major deposits is located, or if
Applicant does not have deposits with the Bank, the Bank's office in a state of
the United States where Applicant's major banking relationship with it is
conducted; if neither of the foregoing apply, then jurisdiction shall mean New
York City, New York; (K) "OBLIGATIONS" means all obligations of any, some or all
of parties comprising the Applicant to Bank now or hereafter existing under the
Agreement or otherwise; (L) "PRIME RATE" means that changing rate of interest
announced publicly from time to time by Bank as its Prime Rate; (M) "PROPERTY"
means all present and future inventory, equipment, farm products and other
goods, documents, policies and certificates of insurance, securities, securities
entitlements, securities accounts, financial assets, investment property,
instruments, letters-of-credit and letter-of-credit rights, chattel paper,
accounts, general intangibles, money, and any and all other types of property
(including, but not limited to, deposit accounts and certificates of deposit),
together with all cash and non cash proceeds and products thereof, and all
Applicant's rights thereto and all documents relative thereto; and (N) "UCP"
means the Uniform Customs and Practice for Documentary Credits, ICC Publication
Number 500, or any subsequent revision or restatement thereof adopted by the ICC
and in use by the Bank. Terms not defined herein will, if defined therein, have
the same meaning as given in the Uniform Commercial Code as amended from time to
time.


<PAGE>

         2. APPLICANT'S REIMBURSEMENT OF BANK: (A) Applicant shall pay Bank, in
accordance with the provisions of the Loan Agreement, (i) the amount of each
Draft drawn or purporting to be drawn under the Credit (whether drawn before, on
or after the expiry date stated in the Credit) and (ii) interest on all amounts
so drawn. (B) FEES COSTS AND EXPENSES. Applicant will pay Bank (i) fees in
respect of the Credit at such rates and times as are provided in the Loan
Agreement; and (ii) on demand, all costs and expenses that Bank incurs in
connection with the Credit or this Agreement, including (a) reasonable
attorneys' fees and disbursements and other dispute resolution expenses to
protect or enforce Bank's rights or remedies under or in connection with the
Credit, this Agreement or any separate security agreement, guaranty or other
agreement or undertaking supporting this Agreement or to respond to any notice
of forgery, fraud, abuse or illegality in connection with this Agreement, the
Credit, any presentation under the Credit or any transaction underlying the
Credit (including an active defense by Bank in any action in which an injunction
is sought or obtained against presentation or honor), (b) costs and expenses in
connection with any requested amendment to or waiver under the Credit or this
Agreement, (c) costs and expenses in complying with any governmental exchange,
currency control or other laws, rules or regulations of any country now or
hereafter applicable to the purchase or sale of, or dealings in, foreign
currency, (d) any stamp taxes, recording taxes, or similar taxes or fees payable
in connection with the Credit or this Agreement, and (e) any adviser, confirmer,
or other nominated person fees and expenses that are chargeable to Applicant or
Bank. References in this Agreement to attorneys' fees and disbursements shall
include any reasonably allocated costs of internal counsel.

         3. INDEPENDENCE; APPLICANT RESPONSIBILITY. Applicant is responsible for
preparing or approving the text of the Credit as issued by Bank and as received
by any Beneficiary, including responsibility for any terms and conditions
thereof that are ineffective, ambiguous, inconsistent, unduly complicated, or
reasonably impossible to satisfy. Applicant's ultimate responsibility for the
final text shall not be affected by any assistance Bank may provide such as
drafting or recommending text or by Bank's use or refusal to use text submitted
by Applicant. Bank does not represent or warrant that the Credit will satisfy
Applicant's requirements or intentions. Applicant is responsible for the
suitability of the Credit for Applicant's purposes. Applicant will examine the
copy of the Credit, and any other documents sent by Bank in connection with the
Credit, and shall notify Bank of any non-compliance with Applicant's
instructions, and of any discrepancy in any document under any presentment or
other irregularity, within 3 Business Days after Applicant receives or should
have received any of such documents (the "Required Time"); provided, however, if
the end of the Required Time falls on a weekend or Bank holiday, the deadline
shall be extended to the end of the next Business Day. Applicant's failure to
give timely and specific notice during the Required Time of objection shall
automatically waive Applicant's objection, authorize or ratify Bank's action or
inaction, and preclude Applicant from raising the objection as a defense or
claim against Bank.

                                        2
<PAGE>

         4. CLAIMS AGAINST BANK; WAIVERS; EXCULPATIONS; LIMITATIONS OF
LIABILITY, RATIFICATION; ACCOUNTING. (A) Applicant's Obligations shall be
irrevocable and unconditional and performed strictly in accordance with the
terms of this Agreement, irrespective of: (i) any change or waiver in the time,
manner or place of payment of or any other term of the Obligations (including
any release) of any other party who, if applicable, has guaranteed or is jointly
and severally liable for any of the Obligations or granted any security
therefore; (ii) any exchange, change or release of any Collateral or other
collateral (including any failure of Bank to perfect any security interest
therein), for any of the Obligations, (iii) any presentation under the Credit
being forged, fraudulent or any statement therein being untrue or inaccurate,
(iv) any agreement by Bank and any Beneficiary extending or shortening Bank's
time after presentation to examine documents or to honor or give notice of
discrepancies. (B) Without limiting the foregoing, it is expressly agreed that
the Obligations of Applicant to reimburse or to pay Bank pursuant to this
Agreement will not be excused by ordinary negligence, gross negligence, wrongful
conduct or willful misconduct of Bank. However, the foregoing shall not excuse
Bank from liability to Applicant in any independent action or proceeding brought
by Applicant against Bank following such reimbursement or payment by Applicant
to the extent of any unavoidable direct damages suffered by Applicant that are
caused directly by Bank's gross negligence or willful misconduct; provided that
(i) Bank shall be deemed to have acted with due diligence and reasonable care if
it acts in accordance with standard letter of credit practice of commercial
banks located in the place that the Credit is issued; and (ii) Applicant's
aggregate remedies against Bank for wrongfully honoring a presentation or
wrongfully retaining honored documents shall in no event exceed the aggregate
amount paid by Applicant to Bank with respect to the honored presentation, plus
interest. (C) Without limiting any other provision of the Agreement, Bank and,
as applicable, its correspondents: (i) may rely upon any oral, telephonic,
telegraphic, facsimile, electronic, written or other communication believed in
good faith to have been authorized by Applicant, whether or not given or signed
by an authorized person; (ii) shall not be responsible for any acts or omissions
by, or the solvency of, any Beneficiary, any nominated person or any other
person; (iii) May honor any presentation or drawing under the Credit that
appears on its face substantially to comply with the terms and conditions of the
Credit; (iv) (a) may permit partial shipment under the Credit, except as
otherwise expressly stated in the Credit, and may honor the relative Drafts
without inquiry regardless of any apparent disproportion between the quantity
shipped and the amount of the relative Draft and the total amount of the Credit
and the total quantity to be shipped under the Credit, and (b) if the Credit
specifies shipments in installments within stated periods and the shipper fails
to ship in any designated period, shipments of subsequent installments may
nevertheless be made in their respective designated periods, and the relative
Drafts may be honored; (v)may disregard any requirement of the Credit that
presentation be made to it at a particular place or by a particular time of day
(but not any requirement for presentation by a particular day) or that notice of
dishonor be given in a particular manner, and Bank may amend or specify any such
requirement in the Credits; (vi) may accept as a draft any written or electronic
demand or request for payment under the Credit, even if nonnegotiable or not in
the form of a draft, and may disregard any requirement that such draft, demand
or request bear any or adequate reference to the Credit; (vii) may discount or
authorize the discount of any accepted draft or deferred payment obligation
incurred under any Credit; (viii) may honor, before or after its expiration, a
previously dishonored presentation under the Credit, whether pursuant to court
order, to settle or compromises any claim that is wrongfully dishonored or



                                       3
<PAGE>

otherwise, and shall be entitled to reimbursement to the same extent (if any) as
if it had initially honored plus reimbursement of any interest paid by it; (ix)
may honor, upon receipt, any drawing that is payable upon presentation of a
statement advising negotiation or payment (even if such statement indicates that
a draft or other document is being separately delivered) and shall not be liable
for any failure of any Draft or document to arrive or to conform with the Draft
or document referred to in the statement or any underlying transaction; (x) may
retain proceeds of the Credit based on a valid exercise of Bank's set off rights
or an apparently applicable attachment order or blocking regulation; (xi) may
select any branch or affiliate of Bank or any other bank to act as advising,
transferring, confirming and/or nominated bank under the law and practice of the
place where it is located; (xii) shall not be responsible for any other action
or inaction taken or suffered by Bank or its correspondents under or in
connection with the Credit, with any presentation thereunder or with any
Collateral, if required or permitted under any applicable domestic or foreign
law or letter of credit practice. Examples of laws or practice that may be
applicable, depending upon the terms of the Credit and where and when it is
issued, include the UCC, the Uniform Rules for Demand Guarantees ("URG") the
UCP, the ISP, published rules of practice, applicable standard practice of banks
that regularly issue letters of credit, and published statements or
interpretations on matters of standard bank practice. (D) Applicant's taking
control, possession or retention of any documents presented under or in
connection with the Credit (whether or not the documents are genuine) or of any
Property for which payment is supported by the Credit, shall ratify Bank's honor
of the documents and preclude Applicant from raising a defense, set-off or claim
with respect to Bank's honor of the documents. (E) Neither Bank nor any of its
correspondents shall be liable in contract, tort, or otherwise, for any
punitive, exemplary, consequential, indirect or special damages. Any claim by
Applicant under or in connection with this Agreement or the Credit shall be
reduced by an amount equal to the sum of (I) the amount (if any) saved by
Applicant as a result of the breach or other wrongful conduct complained of; and
(ii) the amount (if any) of the loss that would have been avoided had Applicant
taken all reasonable steps to mitigate any loss, including by enforcing its
rights in the transaction(s) underlying the Credit, and in case of a claim of
wrongful dishonor, by specifically and timely authorizing Bank to effect a cure.

         5. SECURITY AGREEMENT. The provisions of this Section shall only
supplement, not supersede, provisions of any other security agreement in favor
of Bank which are inconsistent herewith. (A) SECURITY INTEREST. As security for
the payment and performance of the Obligations, Applicant assigns, pledges and
grants to Bank a security interest in the Collateral. The security interest of
Bank in Collateral shall continue until all Obligations are repaid, and shall
not be invalidated by reason of the delivery or possession of the Property to
Applicant or anyone else. (B) SUBROGATION. As additional security for the
Obligations, Bank shall be subrogated to the Applicant's rights in respect of
any transaction in any way related to the Credit or any Drafts, including rights
against Beneficiary or any collateral.

         6. COMMUNICATIONS. (A) INTERNET. Applicant may electronically initiate
the issuance and amendment of any Credit and retrieve or send information about
any outstanding Credit by accessing an Internet site maintained by the Bank (the
"Web Site") through Applicant's computer equipment and web browser software.
Applicant is responsible to provide its own computer equipment and web browser
software and shall be responsible for all acquisition, installation, repair and
maintenance costs associated therewith. Applicant shall select its own Internet
service provider. Applicant shall comply promptly with all instructions on the
Web Site governing its use and the security measures to be maintained in



                                       4
<PAGE>

connection with its use. Applicant authorizes the Bank to receive data and act
upon Applicant's requests which Bank receives over the Web Site. Applicant
agrees that Bank may rely on the authenticity and accuracy of messages and
information received by Bank on the Web Site purporting to be from the
Applicant. Applicant agrees: (i) to protect all assigned operator identification
passwords and accepts full responsibility for any compromise of security;(ii) to
limit access to the Web Site to those persons authorized by Applicant through
the use of security procedures implemented and enforced by the Applicant; (iii)
accurately to input any data fields necessary to initiate, release or cancel any
transaction; (iv) to access the Web Site as often as necessary consistent with
Applicant's business activities it conducts on the Web Site, which may be daily,
and retrieve and review outstanding Credit detail reports; and (v) to notify the
Bank promptly of any error or defect in the report. Applicant acknowledges and
understands that the instructions sent by it through the Internet to the Bank
and the information retrieved by the Applicant from the Web Site through the
internet will be encrypted, but that such encryption is not completely secure
and is not free from errors, poor transmissions, interception, forgery, viruses,
tampering, destruction, deciphering or other delay or casualty. The Bank shall
not be liable for any loss, claim or liability, cost or expense arising from:
(a) any of the foregoing; (b) failure of any Internet service provider to
provide its services; (c) failure of communications media, legal restrictions;
(d) act of God, fire or other catastrophe, computer failure or any other cause
or circumstance beyond the Bank's control; (e) any unauthorized person's use of
or access to the Web Site; or (f) failure of Applicant to report errors or
defects promptly. (B) Electronic Systems. Applicant may desire to transmit and
receive by means of facsimile, open internet communication, or other unguarded
electronic communications (hereinafter collectively the "electronic systems")
Applications and other paper-writings to or from the Bank. To induce the Bank to
accept communication via electronic systems, Applicant shall: I) ensure that its
officers, agents and employees, will at all times follow and maintain the
integrity of any security established by the Applicant and the Bank; ii)
immediately notify the Bank in the event that Applicant should have reason to
believe that the security established for electronic systems transmission has
been breached or compromised in any manner; iii) ensure that only authorized
personnel selected and controlled by the Applicant request action(s) by
transmittal of document(s) by electronic systems; iv) ensure that any documents
transmitted to the Bank by means of electronic systems shall be a complete and
accurate copy and if signed be executed by personnel authorized by the
Applicant; and v) maintain its software and equipment and any privacy control
device within such software or equipment without any reliance on or
responsibility by the Bank. The Applicant acknowledges and agrees that the Bank
shall: I) not be responsible to the Applicant for any loss or damage arising
from the use of unguarded electronic systems, including access or misuse of
Applicant's confidential information, transmission of a virus, or failed,
incomplete or inaccurate transmission; ii) not be responsible to assure that,
its software and equipment for receiving messages or documents from electronic
systems will be compatible with that of Applicant or available at all times for
Applicant's use; iii) have absolute discretion but without liability, for any
reason whatsoever, not to act upon documentation received by electronic systems;
provided, however, that the Bank shall notify the undersigned promptly should it
elect to defer action until the original documentation is physically presented
to the Bank; iv) without any liability on its part to do so, have the right at
its discretion to make further inquiries and demand further verification to
determine the validity of any document prior to taking any action; and v) have
the right to assume that any reproduction of documentation received by
electronic systems constitutes a full, complete and accurate reproduction of the
original documentation and that all signatures are authorized and genuine. (C)
Indemnity. Separate and independent from any other indemnity set forth in this
Agreement, the Applicant hereby indemnifies and holds the Bank harmless against
any and all loss, liability, damage or expenses of whatever kind and nature
arising from Bank's acceptance and/or delivery of information and Applications
over its Web Site or by electronic systems.

                                       5
<PAGE>

         7. TWO PARTIES SIGNING AGREEMENT. (A) CO-APPLICANTS. If the Agreement
is signed by two or more Applicants, it shall be the joint and several
obligation of each. Bank shall designate _____________________ in the Credit as
account party and ______________________ as Applicant, who without joinder of
the account party shall have the exclusive right to issue all instructions on
any matters relating to the Credit. If the foregoing information is left blank
or incomplete, the Bank at its discretion may accept an Application, or seek
instruction, from any Applicant regarding a Credit, including, without
limitation, any amendment thereto or waiver of any discrepancy thereunder, and
until Bank at the office at which the relevant Credit is issued actually
receives written notice of revocation, each Applicant shall be bound by and
hereby affirms the instructions of the other. (B) Financial Institution as
Customer. If the Agreement is signed as Applicant or co-Applicant by a bank,
trust company or other financial institution for its customer, such Applicant
appoints Bank as its agent to issue the Credit. Such Applicant and its customer
agree to act In accordance with and be subject to the Agreement. If such
Applicant is required (i) to reimburse Bank; (ii) to pay Bank in the Event of
Default; (iii) to indemnify Bank; or (iv) to provide collateral, then its
customer agrees to reimburse, pay or indemnify Applicant for the full amount of
those payments and to provide the requisite collateral. In addition, the
customer agrees to obtain such Applicant's consent before agreeing to waive any
discrepancy in the documents related to the Credit or to waive or amend any
terms of the Agreement or the Credit.

         8. EVENT OF DEFAULT. On and after any Event of Default: (A) the amount
of the Credit, as well as any other Obligations, shall, at Bank's option, become
due and payable immediately without demand or notice to Applicant or if
contingent, may be treated by Bank as due and payable for its maximum face
amount; (B) Bank may set off and apply any deposits or any other indebtedness at
any time owing by Bank to or for Applicant's credit or account against any
matured or unmatured Obligations, irrespective of whether or not Bank shall have
made any demand under the Agreement and although such deposits, indebtedness or
Obligations may be unmatured or contingent; (C) Bank may exercise all rights and
remedies available to it in law or equity; and (D) in respect of any Collateral,
Bank may exercise all the rights and remedies of a secured party under the
Uniform Commercial Code or any other applicable law and also may, without notice
except as required by law, sell such Property or any part thereof in one or more
parcels at public or private sale, for cash, on credit or for future delivery,
and on such other terms as Bank may deem commercially reasonable. Written notice
mailed or delivered to Applicant at the address specified in the Agreement at
least five business days prior to the date of public sale or prior to the date
after which private sale is to be made shall be reasonable, adequate notice.
Applicant will pay on demand all costs and expenses (including reasonable
attorneys fees and legal expenses, incurred prior to or after a bankruptcy
filing) related to the custody, preservation or sale of, or collection from, or
realization upon, any of such Property and related to the collections of the
Obligations and the enforcement of Bank's rights against Property. In the event
of sale of or collection from the Collateral, Bank may in its discretion hold
the proceeds as Collateral or apply the proceeds as Bank deems appropriate to
the payment of costs and expenses or to one or more of the Obligations, whether
or not then due.

                                       6
<PAGE>

         9. INDEMNIFICATION. Applicant will indemnify and hold harmless Bank and
its officers, directors, affiliates, employees, attorneys and agents (each, an
"Indemnified Party") from and against any and all claims, liabilities, losses,
damages, costs and expenses (including reasonable attorneys' fees and
disbursements and other dispute resolution expenses (including fees and expenses
in preparation for a defense of any investigation, litigation or proceeding) and
costs of collection) that arise out of or in connection with: (A) the Credit or
any pre-advice of its issuance; (B) any payment or action taken or omitted to be
taken in connection with the Credit or this Agreement (including any action or
proceeding to (i) restrain any presentation, (ii) compel or restrain any payment
or the taking of any other action under the Credit, (iii) obtain damages for
wrongful dishonor or honor of the Credit or for breach of any other duty arising
out of or related to the Credit, (iv) compel or restrain the taking of any
action under this Agreement or (v) obtain similar relief (including by way of
interpleader, declaratory judgment, attachment or otherwise), regardless of who
the prevailing party is in any such action or proceeding); (C) an adviser or a
confirmer or other nominated person seeking to be reimbursed, indemnified or
compensated, (D) any beneficiary requested to issue its own undertaking seeking
to be reimbursed, indemnified or compensated or (E) any third party seeking to
enforce the rights of an applicant, beneficiary, nominated person, transferee,
assignee of letter of credit proceeds, or holder of an instrument or document;
(F) the enforcement of this Agreement or any rights or remedies under or in
connection with this Agreement, the Collateral or the Credit; (G) the release by
Applicant of any Credit to any third party prior to its issuance by the Bank; or
(H) any act or omission, whether rightful or wrongful, of any present or future
de jure or de facto government or governmental authority (including with respect
to any document or property received under this Agreement or the Credit) or any
other cause beyond the Bank's control-, except to the extent such liability,
loss, damage, cost or expense is found in a final, non-appealable judgment by a
court of competent jurisdiction to have resulted directly from such Indemnified
party's gross negligence or willful misconduct. Applicant will pay on demand
from time to time all amounts owing under this section. If and to the extent
that the obligations of Applicant under this section are unenforceable for any
reason, Applicant agrees to make the maximum contribution to the payment of such
obligation that is permissible under applicable law.

         10. GOVERNING LAW; UCP, ISP 98. The UCP or ISP 98 as applicable to each
Credit governs this Agreement and is incorporated herein. Subject to the other
provisions of the Agreement, the Agreement shall be governed by and construed in
accordance with the substantive laws of the Jurisdiction, without regard to
conflicts of law principles, except to the extent that such law is inconsistent
with the UCP or ISP 98, as applicable. In the event any provision of the UCP or
ISP 98, as applicable, is or is construed to vary from or be in conflict with
any provision of any applicable law of the Jurisdiction or the federal law of
the United States, to the extent permitted by law, the UCP or the ISP 98, as
applicable, shall govern or be read to explain the applicable law. Unless
Applicant specifies otherwise in its application for the Credit, Applicant
agrees that Bank may issue the Credit subject to the UCP or ISP 98 or, at Bank's
option, such later revision of either thereof as is in effect at the time of
issuance of the Credit. Bank's privileges, rights and remedies under the UCP,
ISP 98 or such later revision shall be in addition to, and not in limitation of,
its privileges, rights, and remedies expressly provided for herein. The UCP and
ISP 98 shall serve, in the absence of proof to the contrary, as evidence of
standard practice with respect to the subject matter thereof.

                                       7
<PAGE>

         11. SAVINGS CLAUSE; CONFLICTS. Whenever possible, each provision of the
Agreement shall be interpreted in a manner as to be effective and valid under
applicable law, but if any provision of the Agreement shall be prohibited by or
invalid under applicable law, such provision shall be ineffective only to the
extent of such prohibition or invalidity, without invalidating the remainder of
such provision or the remaining provisions of the Agreement. In the event that
any provision in the Agreement conflicts with the provisions of the Loan
Agreement, the provisions of the Loan Agreement shall control.

         12. BANKRUPTCY AND FORFEITURE REINSTATEMENT. If any consideration
transferred to Bank in payment of, or as collateral for, or in satisfaction of
the Obligations, shall be voided in whole or in part as a result of (A) a
subsequent bankruptcy or insolvency proceeding; (B) any forfeiture or in rem
seizure action or remedy; (C) any fraudulent transfer or preference action or
remedy; or (D) any other criminal or equitable proceeding or remedy, then Bank
may at its option recover the Obligations or the consideration so voided from
Applicant. In such event, Bank's claim to recover the voided consideration shall
be a new and independent claim arising under the Agreement, and shall be jointly
and severally due and payable immediately by Applicant.

         13. MISCELLANEOUS. The rights and remedies granted to Bank in the
Agreement are in addition to all other rights or remedies afforded to Bank under
applicable law, equity or other agreements. The terms of the Agreement may not
be waived or amended, unless the parties consent in writing. The Agreement shall
be binding on Applicant's heirs, executors, administrators, successors and
permitted assigns, and shall inure to the benefit of Bank's successors and
assigns. Bank can assign this Agreement and its rights to reimbursement
regarding any Credit without Applicant's consent. Applicant shall not assign any
rights or remedies related to the Agreement or the Credit without written
consent of the Bank. Any notice to Applicant, if mailed, shall be deemed given
when mailed, postage paid, addressed to Applicant at the address on the
Application or such other address furnished by Applicant to Bank. This Section
shall not be deemed to be an exclusive list of each means of notice from one
party to the other. The Agreement will continue in full force and effect until
the expiration or cancellation of each Credit and all outstanding Obligations
have been satisfied in a manner satisfactory to Bank, and Applicant requests
termination in writing. Applicant will comply with all laws, regulations and
customs now or hereafter applicable to the Agreement or to the transaction
related to the Credit, and will furnish evidence of compliance as Bank may
require. Applicant shall maintain or cause to be maintained insurance covering
any Property for which payment is supported by a Credit in amounts, from
insurers, or through parties satisfactory to the Bank and will furnish such
evidence of insurance as and when Bank may require. This Agreement contains the
final, complete and exclusive understanding of, and supersedes all prior or
contemporaneous, oral or written, agreements, understandings, representations
and negotiations between, the parties relating to the subject matter of this
Agreement.

                                       8
<PAGE>

         14. CONSENT TO JURISDICTION AND VENUE. IN ANY PROCEEDING INVOLVING,
DIRECTLY OR INDIRECTLY, ANY MATTER ARISING OUT OF OR RELATED TO THE AGREEMENT OR
THE RELATIONSHIP ESTABLISHED HEREUNDER, APPLICANT IRREVOCABLY SUBMITS TO THE
NONEXCLUSIVE JURISDICTION OF ANY STATE OR FEDERAL COURT LOCATED IN ANY COUNTY IN
THE JURISDICTION AND AGREES NOT TO RAISE ANY OBJECTION TO THE JURISDICTION OR TO
THE LAYING OR MAINTAINING OF THE VENUE OF ANY SUCH PROCEEDING IN THE
JURISDICTION. APPLICANT AGREES THAT SERVICE OF PROCESS IN ANY SUCH PROCEEDING
MAY BE DULY EFFECTED UPON IT BY MAILING A COPY THEREOF, BY REGISTERED MAIL,
POSTAGE PREPAID, TO IT.

         15. WAIVER OF JURY TRIAL. TO THE EXTENT PERMITTED BY APPLICABLE LAW,
APPLICANT AND WHEN IT ISSUES A CREDIT, BANK KNOWINGLY AND VOLUNTARILY WAIVE ALL
RIGHTS TO TRIAL BY JURY WITH RESPECT TO ANY LITIGATION BASED ON, ARISING OUT OF,
OR RELATING TO THE AGREEMENT OR THE CREDIT, OR ANY COURSE OF CONDUCT, COURSE OF
DEALING, STATEMENTS (ORAL OR WRITTEN) OR ACTIONS OF ANY PARTY WITH RESPECT
THERETO. THIS WAIVER IS A MATERIAL INDUCEMENT FOR BANK TO ISSUE THE CREDIT.

         16. EFFECTIVENESS OF AGREEMENT. Applicant agrees that the terms and
conditions of this Continuing Letter of Credit Agreement shall be continuing and
shall apply to any Credit currently, or in the future, issued by the Bank on
Applicant's behalf.

Very truly yours,



----------------------------------------
(Corporation or Firm Name of Applicant)


By:                                        Date:
    ---------------------------------            ------------------------------
(Authorized Signature and Title)


By:                                        Date:
    ---------------------------------            ------------------------------
(Authorized Signature and Title)


----------------------------------------
(Corporation or Firm Name of Applicant)


By:                                        Date:
    ---------------------------------            ------------------------------
(Authorized Signature and Title)


By:                                        Date:
    ---------------------------------            ------------------------------
(Authorized Signature and Title)

                                       9
<PAGE>



                                   Exhibit 8.7

                     Form of Covenant Compliance Certificate

                          For the Fiscal Quarter ended
                             _________________, 200_

         I, ____________________________, the Chief Financial Officer of Orleans
Homebuilders, Inc. ("OHB") certify to Wachovia Bank, National Association, as
agent for the Lenders ("Agent"), and the Lenders that the calculations shown on
the attached covenant compliance spreadsheet are true and correct as of
______________, 200_:

         The undersigned hereby certifies that no Event of Default under the
Amended and Restated Revolving Credit Loan Agreement dated as of January 24,
2006 by and among Greenwood Financial, Inc., the other Affiliates of OHB that
are party thereto, Agent, and the Lenders (as heretofore amended, the "Loan
Agreement") has occurred and is continuing. All capitalized terms used and not
defined in this Certificate have the meanings defined in the Loan Agreement.


                                                   _____________________________



<PAGE>






                                  Exhibit 13.9

                        Form of Assignment and Acceptance


         THIS ASSIGNMENT AND ACCEPTANCE AGREEMENT ("this Agreement") made and
entered into on _____________________, 200__, between _________________________
("Assignor") and ______________________________ ("Assignee"), and consented to
and accepted by each of WACHOVIA BANK, NATIONAL ASSOCIATION, as Agent ("Agent")
and, if required by the terms of the Loan Agreement (defined below), GREENWOOD
FINANCIAL, INC. (the "Master Borrower").

                                    RECITALS

         A. Assignor is a party to the Amended and Restated Revolving Credit
Loan Agreement, dated January 24, 2006, by and among Agent, Master Borrower and
the Lenders and other Borrowers that are signatories thereto (as heretofore
amended, the "Loan Agreement"). Copies of the Loan Agreement and related
documents have been delivered to Assignee prior to the date hereof.

         B. Initially capitalized terms not otherwise defined herein shall have
the same meanings as ascribed to them in the Loan Agreement.

         C. Pursuant to the Loan Agreement, Assignor agreed to make Loans and
Letter of Credit Advances to Borrowers up to an aggregate principal amount of
$___________ at any one time outstanding (the "Assignor Commitment"), evidenced
by a Line of Credit Note payable to Assignor in the same original principal
amount (the "Assignor Note"). On the date hereof, the unfunded portion of the
Assignor Commitment is $ ____________ (the "Available Commitment") and the
funded portion of the Assignor Commitment is $____________, representing
currently outstanding Loans and Letter of Credit Advances previously made by
Assignor.

         D. Assignor desires to sell and assign to Assignee, and Assignee
desires to purchase and assume from Assignor, [a portion of] the interest of
Assignor in, and of the rights and obligations of Assignor under, the Loan
Agreement, the Assignor Note, the Loan Documents, and all other documents,
instruments and agreements executed and delivered in connection therewith in the
manner, to the extent and upon the terms set forth below.

         NOW, THEREFORE, in consideration of the foregoing and the agreements
and covenants hereinafter set forth, the parties hereto agree as follows:

         1. Assignment and Assumption.

                  1.1 Assignor hereby sells, assigns, delegates and transfers to
Assignee, without recourse and without any representations or warranties, except
as set forth in Section 7.1 of this Agreement, effective on the Assignment Date,
(as such term is defined in Section 4 of this Agreement) a _____% (the "Assigned
Percentage") interest in and to Assignor's rights and obligations under the Loan
Agreement and other Loan Documents and representing:


<PAGE>

                           1.1.1 the Assigned Percentage of the aggregate
principal amount of Loans and Letter of Advances made by Assignor on or prior
to, and outstanding on, the Assignment Date (the "Assigned Fundings"), which
Assigned Fundings, as of the date hereof, equal the sum of $____________
respecting outstanding Loan and Letter of Credit Advances with all interest
accruing and payable thereon on and after the Assignment Date;

                           1.1.2 the Assigned Percentage of the Assignor
Commitment pursuant to the terms and provisions of the Loan Agreement (the
"Assigned Commitment"), which Assigned Commitment is equal to, on the date
hereof, $____________ of which, on the date hereof, $____________ constitutes an
amount equal to the Assigned Percentage of the Available Commitment;

                           1.1.3 the Assigned Percentage of Assignor's interest
in the Unused Fee accruing and payable pursuant to Section 2.6.3 of the Loan
Agreement after the Assignment Date; and

                           1.1.4 the Assigned Percentage of all of Assignor's
rights (including voting rights), interests and obligations under the Loan
Agreement, the Assignor Note and each other Loan Document;

provided, however, that in no event shall such assignment include, or be deemed
to include (y) any amounts paid to Assignor under or pursuant to the Loan
Agreement prior to the Assignment Date, and (z) interest, fees and other amounts
accruing on the Assigned Fundings and the Assigned Commitments prior to the
Assignment Date but which are payable after such date.

                  1.2 Assignee hereby irrevocably purchases, takes and assumes,
effective on the Assignment Date, all duties, liabilities, obligations, rights
and interests assigned to it by Assignor (including, without limitation, the
obligation to make Loans and Letter of Credit Advances up to the amount of the
Assigned Commitment) and agrees to perform all such duties, liabilities and
obligations on and after the Assignment Date as if it had been an original party
to the Loan Agreement and other Loan Documents to which Lenders are parties, all
as is more specifically set forth in Section 1.1 of this Agreement.

         2. Purchase Price.

                  As consideration for the assignment effected hereby, and as a
precondition to the effectiveness thereof, prior to 5:00 p.m. prevailing Eastern
time on the Assignment Date, Assignee shall pay to Assignor an amount equal to
such aggregate principal amount of the Assigned Fundings, in immediately
available U.S. Dollars.
<PAGE>

         3. Confirmation and Agreement.

                  By executing and delivering this Agreement, (a) Assignor and
Assignee confirm to and agree with each other and the other parties to the Loan
Agreement as follows: (i) Assignor makes no representation or warranty (except
as provided in Section 7.1 of this Agreement) and assumes no responsibility with
respect to any statements, warranties or representations made in or in
connection with the Loan Agreement or any other Loan Document or the execution,
legality, validity, enforceability, genuineness, sufficiency, collectibility or
value of this Agreement, the Loan Agreement, the Assignor Note or any other Loan
Document; and (ii) Assignor makes no representations or warranties and assumes
no responsibility with respect to the financial condition of Borrowers or of
Guarantor or the performance or observance by Borrowers or Guarantor of any of
their respective obligations under the Loan Agreement, any other Loan Document
or any other instrument or document furnished pursuant thereto; (b) Assignee
confirms that it has received a copy of the Loan Agreement and other Loan
Documents, together with such other documents and information as Assignee has
deemed appropriate to make its own credit analysis and decision to enter into
this Agreement; (c) Assignee confirms that it has made, independently and
without reliance upon the Agent, Assignor or any other Lender or, except as
provided in Section 7.1 of this Agreement, any representations or warranties
made by the foregoing and based on such documents and information as Assignee
shall deem appropriate at the time, and Assignee shall continue to make, its own
credit decisions in entering into this Agreement and taking or not taking any
action hereunder or under the Loan Agreement or any other Loan Document; and (d)
Assignee appoints and authorizes Agent to take such action as agent on its
behalf and to exercise such powers under the Loan Agreement as are delegated to
Agent by the terms thereof, together with such powers as are reasonably
incidental thereto.

         4. Assignment Date.

                  The Assignment Date for this Agreement shall be the date first
above written; provided, however, that if Assignee shall not have paid to
Assignor the amount referred to in Section 2 hereof, prior to 5:00 p.m.
prevailing Eastern time on such date, then the Assignment Date shall instead be
the date on which Assignee shall have so satisfied such condition; further
provided, that if Assignee does not so satisfy such condition prior to 5:00 p.m.
prevailing Eastern time on the tenth (10th) Business Day following the date
first written above, this Agreement shall terminate and Assignor shall have no
further obligations to Assignee.

         5. Exercise of Rights.

                  From and after the Assignment Date, (a) the Assignee shall be
a party to the Loan Agreement and each other Loan Document to which Lenders are
parties and, to the extent provided in this Agreement, shall have the rights,
liabilities, duties and obligations of a Lender thereunder, and (b) the Assignor
shall, to the extent provided in this Agreement, relinquish such rights and be
released from such liabilities, duties and obligations under the Loan Agreement
and such other Loan Documents as shall have been assigned to the Assignee
hereunder.


<PAGE>

         6. Payments.

                  Following the Assignment Date, Agent shall make all payments
in respect of the Assigned Fundings and Assigned Commitment (including payments
of principal, and of fees, interest, and other amounts accruing and payable
subsequent to the Assignment Date) to the Assignee at the address specified on
the signature pages hereto which address shall be deemed to be the Assignee's
notice address for purposes of the Loan Agreement and the other Loan Documents
unless Assignee otherwise notifies the relevant parties pursuant to the terms
thereof. To the extent either Assignee or Assignor shall receive amounts to
which the other is entitled pursuant to the terms hereof, Assignor and Assignee
shall make all appropriate adjustments thereof. Without limiting the generality
of the foregoing, Assignor shall be entitled to retain all amounts received by
it on account of its Pro Rata Share of (x) any interest accrued on any Loans or
Letter of Credit Advances prior to the Assignment Date, (y) Unused Fees with
respect to the Assignor Commitment accrued prior to the Assignment Date and (z)
interest, fees and other amounts accruing on the Assigned Fundings and the
Assigned Commitment prior to the Assignment Date. To the extent that Assignee
shall receive any such amounts, Assignee shall hold the same in trust for the
benefit of, and shall immediately pay the same over to, Assignor.

         7. Representations.

                  7.1 Assignor represents and warrants that (i) the documents
referred to in the final sentence of Recital A which have been delivered to
Assignee are the current versions of such documents; and (ii) the officer of the
Assignor responsible for the credit relationship with Borrowers is not aware of
the existence of any Event of Default as of the Assignment Date nor does the
Assignor have any knowledge of any waiver of any material provision of any Loan
Document having been given in writing; and (iii) it is the legal and beneficial
owner of the interest being assigned hereby, free and clear of any adverse
claim.

                  7.2 Except for the representation and warranty set forth in
Section 7.1 of this Agreement, Assignor does not make any representation or
warranty, expressed or implied, and assumes no responsibility with respect to,
the sufficiency, value or collectibility of the Assigned Fundings, the Loan
Agreement or related documents or any rights afforded thereby or matters
mentioned therein; or with respect to the financial condition of Borrowers or of
Guarantor or the ability of any of the foregoing to liquidate any of their
respective assets; or with respect to the validity, enforceability, authenticity
or accuracy of any statement, report, certificate or other information made or
given or to be given to Assignor or Assignee by Borrowers, or Guarantor in
connection with the Loan Agreement.

         8. Assignment.

                  Assignee agrees that it shall not sell, assign, subdivide or
transfer in any way its rights or interests or delegate all or any part of its
obligations which are the subject of this Agreement except as permitted by the
Loan Agreement. This Agreement shall be binding upon and inure to the benefit of
the parties hereto and their respective successors and, subject to the
foregoing, assigns. Nothing herein shall impair Assignor's right to sell,
without notice to or the consent of Assignee, further assignments of, or
participations in, the Assignor Commitment remaining after giving effect to this
Agreement under the Loan Agreement, to the extent permitted thereunder.

         9. Entire Agreement.

                  This Agreement contains the entire agreement of the Assignee
and Assignor with respect to the subject matter contained herein.
<PAGE>

         10. Governing Law.

                  This Agreement and all rights and obligations hereunder shall
be governed by and construed in accordance with the internal laws of the
Commonwealth of Pennsylvania.

         11. Exchange of Line of Credit Notes.

                  Promptly after the Assignment Date, Assignor shall deliver to
Agent the Assignor Note. Agent shall exchange the Assignor Note for new Line of
Credit Notes, each dated the Assignment Date, payable to the Assignor and
Assignee, as their interests shall appear, after giving effect to the assignment
made hereunder, which new Line of Credit Notes Master Borrower agrees to (and
shall cause each of the other Borrowers to) duly execute and deliver to Assignor
and Assignee. Master Borrower, for itself and for each of the other Borrowers,
agrees that the substitution of the new Line of Credit Notes shall not
constitute a novation of any of Borrowers' obligations under the Assignor Note.
Notwithstanding the date of the new Line of Credit Note made in favor of
Assignee, Assignee hereby agrees and confirms, on which confirmation Borrowers
may rely, that Assignee has no right to, or interest in, any interest which
shall have accrued on the Assigned Fundings prior to the Assignment Date.

         12. Counterparts.

                  This Agreement may be executed in counterparts, each of which
shall be an original and all of which shall constitute one agreement. It shall
not be necessary in making proof of this Agreement, or of any document required
to be executed and delivered in connection herewith, to produce or account f or
more than one counterpart signed by each signatory.

                  IN WITNESS WHEREOF, the parties hereto, intending to be
legally bound, have duly executed this Agreement as of the date first above
written.

                             ASSIGNOR:

                             By:
                                  -------------------------------------
                                  Name:
                                  Title:



                             ASSIGNEE:


                             By:
                                  -------------------------------------
                                  Name:
                                  Title:




                        Signatures Continued on Next Page


<PAGE>

                     Signatures Continued from Previous Page



                                   Address for Notices:


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

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

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

                                  Telecopier No.:
                                                  ---------------------
                                  Telephone No.:
                                                  ---------------------
                                  Email:
                                                  ---------------------

                                            Acknowledged, Accepted And Consented
Accepted and Consented to:                  to on behalf of all Borrowers:

Wachovia Bank, National Association,        Greenwood Financial, Inc.
as Agent



By:                                         By:
     -------------------------------             ----------------------------
     Name:                                       Name:
     Title:                                      Title: