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Exhibit 10.5  


 
 

AMENDED AND RESTATED EMPLOYMENT AGREEMENT    
    


        THIS AMENDED AND RESTATED EMPLOYMENT AGREEMENT (this "Agreement") is made effective as of the 31st day of March, 1995 by and between BEAZER HOMES
USA, INC., a Delaware corporation (the "Company"), and John Skelton, an individual resident of the State of Georgia ("Executive"). 


W I T N E S S E T H:  


        WHEREAS, the Company and Executive have heretofore entered into an Employment Agreement dated March 2, 1994 (the "1994 Agreement"); and 



        WHEREAS,
the Company and Executive desire to amend certain provisions of, and to restate in its entirety the 1994 Agreement as provided herein. 


        NOW,
THEREFORE, in consideration of the premises and of the mutual covenants and agreements herein contained, the Company and Executive hereby agree as follows: 


1.    Employment    


        1.1    Employment and Duties.    The Company hereby agrees to employ Executive for the Term (as hereinafter defined)
as its Senior Vice President, Operations and Controller, Beazer Homes USA, Inc., subject to the direction of the Board of Directors of the Company (the "Board") and, in connection therewith, to
perform such duties as he shall reasonably be directed by the Board to perform. In performing such duties hereunder, Executive shall comply with the policies and procedures as adopted from time to
time by the Board, shall give the Company the benefit of his special knowledge, skills, contacts and business experience, shall perform his duties and carry out his responsibilities hereunder
in a diligent manner, shall be just and faithful in the performance of his duties and in carrying out his responsibilities and shall devote all of his business time, attention, ability and energy
exclusively to the performance of his duties and responsibilities hereunder; provided, however, that
Executive may, with the approval of the Board, from time to time, serve, or continue to serve, on the Board of Directors of, and hold any other offices or positions in, companies or organizations,
which, in the Board's judgment, will not present any conflict of interest with the Company or any of its affiliates or divisions, or adversely affect the performance of Executive's duties pursuant to
this Agreement. Executive hereby accepts such employment and agrees to render such services. 


        1.2    Location.    The principal location for performance of Executive's services hereunder shall be at the offices
of Beazer Homes USA, Inc. which are currently located in Atlanta, Georgia, subject to reasonable travel requirements during the course of such performance. In the event circumstances require a
change in such location to another city, Executive shall have not less than three (3) months advance notice of the effective date of the relocation. 


2.    Employment Term    


        2.1    Term.    The term of Executive's employment hereunder (the "Term") shall commence effective as of the date
hereof and shall end on September 30, 1996 (the "Initial Term"), unless sooner terminated as provided herein; provided,  however, that the Term shall
be extended and this Agreement shall be automatically renewed for successive one-year periods unless:
(i) this Agreement is terminated as otherwise provided herein; or (ii) Executive or the Company provides written notice to the other of such party's desire not to extend this Agreement
at least sixty (60) days prior to the expiration date of the Term of this Agreement pursuant to this Section 2.1. 





 



3.    Compensation and Benefits    


        3.1    Cash Compensation.    



        (a)    Base Salary.    In consideration of Executive's services hereunder the Company shall pay Executive an aggregate
base salary at an annualized rate, effective as of the date hereof (until adjusted as provided below), $175,000, payable, in each case, in such nearly equal installments as may be customary for
executive officers employed by the Company (but not less frequently than monthly) or as may otherwise be agreed to between the Company and Executive, in arrears (the "Base Salary"). The Base Salary
for each year shall be prorated according to the number of days in such year during which this Agreement is in effect. Commencing October 1, 1995 and on each October 1 thereafter, the
Base Salary may be adjusted (upward or downward) by the Compensation Committee of the Board, taking into consideration Executive's performance, general cost of living increases, the salaries provided
by comparable businesses, the financial condition of the Company and other similar matters. 


        (b)    Bonuses: Stock Incentive Plans.    Executive will be eligible to participate in the Company's bonus and stock
incentive plans (including, without limitation, the Company's 1994 Stock Incentive Plan) at the discretion of the Compensation Committee of the Board. The amount and terms of, and the targets,
conditions and restrictions applicable to each bonus or other incentive award shall be subject to the provisions of any such plan and of the applicable award letter duly executed and delivered by the
Company. 




        3.2    Participation in Benefit Plans.    The payments provided in Section 3 hereof are in addition to any
benefits to which Executive may be, or may become, entitled under any benefit plan or program of the Company for which key executives are or shall become eligible, including, without limitation,
pension, 401(k), life and disability insurance benefits and/or plans. Further, Executive shall be eligible to receive during the period of his employment under this Agreement, all benefits and
emoluments for which key executives are eligible under every such plan or program to the extent permissible under the general terms and provisions of such plans or programs and in accordance with the
provisions thereof. 


        3.3.    Vacation.    Executive shall be entitled to twenty (20) working days of compensated vacation in each
fiscal year, to be taken at times which do not unreasonably interfere with the performance of Executive's duties hereunder. Any unused vacation time from any fiscal year shall be subject to
accumulation or forfeiture in accordance with Company policy as in effect from time to time. 



        3.4.    Expenses.    The Company will pay or reimburse Executive for all reasonable and necessary
out-of-pocket expenses incurred by him in the performance of his duties under this Agreement. Executive shall keep detailed and accurate records of expenses incurred in
connection with the performance of his duties hereunder and reimbursement therefor shall be in accordance with policies and procedures to be established from time to time by the Board. 


     Termination    



        4.1    General.    In addition to the right of either party to terminate this Agreement pursuant to Section 2
hereof, the Company shall have the right to terminate the employment of Executive as set forth in this Section 4. 


        4.2    Termination for Cause.    In addition to any other remedies which the Company may have at law or in equity, the
Board may immediately terminate Executive's employment under this Agreement by giving Executive written notice of such termination upon or at any time following the occurrence of any of the following
events, and each such termination shall constitute a termination for "cause": 



          (i)  any
act or failure to act (or series or combination thereof) by Executive done with the intent to harm in any material respect the interests of the Company or any
affiliate thereof; 



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         (ii)  the
commission by Executive of a felony; 


        (iii)  the
perpetration by Executive of a dishonest act or common law fraud against the Company or any affiliate thereof; 


        (iv)  a
grossly negligent act or failure to act (or series or combination thereof) by Executive detrimental in any material respect to the interests of the Company or any
affiliate thereof; 


         (v)  the
material breach by Executive of his agreements or obligations under this Agreement; or 


        (vi)  the
continued refusal to follow the directives of the Board which are consistent with Executive's duties and responsibilities identified in Section 1.1 hereof. 




        Upon
the early termination of Executive's employment under this Agreement by the Company for "cause" the Company shall pay to Executive (i) an amount equal to Executive's Base
Salary accrued through the effective date of termination at the rate in effect at the time notice of termination is given, payable at the time such payment is due; and (ii) at the time such
payments are due, all other amounts to which Executive is entitled hereunder (including expense reimbursement amounts accrued to the effective date of termination or amounts under any benefit plan of
the Company, but expressly excluding any bonus or other incentive payment (or portion thereof) in respect of the fiscal year in which this Agreement is so terminated or any fiscal year of the Company
thereafter), and, upon payment of such amounts, the Company shall have no further obligation to Executive under this Agreement. 


        4.3    Disability of Executive.    Subject to applicable law, if Executive shall become ill or be injured or otherwise
become disabled or incapacitated such that, in the opinion of the Board, he cannot fully carry out and perform his duties hereunder, and such disability or incapacity shall continue for a period of
forty-five (45) consecutive days, the Board may, at any time thereafter, by giving Executive twenty (20)-days' prior written notice, fully and finally terminate his employment under
this Agreement. Termination under this Section 4.3 shall be effective as of the date provided in such notice, which date shall not be fewer than ninety (90) days after such notice is
delivered to Executive or his representative, and the Company shall pay Executive his Base Salary accrued to the effective date of termination at the rate in effect at the time of such notice, payable
at the time such payment is due. Upon payment of (i) such accrued Base Salary; and (ii) all other amounts to which Executive may be entitled hereunder, including, without limitation,
(A) subject to the terms of any such bonus or incentive award, any bonus or incentive payment to which the Executive would have been entitled pursuant to Section 3.1(b) hereof (prorated
for the period up to the effective date of termination), provided the targets and other conditions applicable thereto are met, (B) any expense reimbursement amounts accrued to the effective
date of termination, and (C) any amounts under any other benefit plan of the Company, in each case at the time such payments would otherwise have become due and payable in the absence of such
termination, and the Company shall have no further obligation to Executive under this Agreement. 


        4.4    Death of Executive.    This Agreement shall automatically terminate upon the death of Executive. Upon the early
termination of this Agreement as a result of death, the Company shall pay Executive's estate: (i) an amount equal to Executive's Base Salary accrued through the effective date of termination at
the rate in effect at the effective date of termination, payable at the time such payment is due; and (ii) all other amounts to which Executive is entitled hereunder, including, without
limitation, (A) subject to the terms of any such bonus or incentive award, any bonus or incentive payment to which the Executive would have been entitled pursuant to Section 3.1(b)
hereof (prorated for the period up to the effective date of termination), provided the targets and other conditions applicable thereto are met, (B) any expense reimbursement amounts accrued to
the effective date of termination, and (C) any amounts under any other benefit plan of the Company, in each case at the time such payments would otherwise have become due and payable in the
absence of such termination, and the Company shall have no further obligations to Executive under this Agreement. 


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        4.5    Termination Not Otherwise Provided For.    This Section 4.5 governs all terminations of Executive's
employment hereunder which are not otherwise provided for in this Section 4 and expressly contemplates a termination of Executive without "cause" and by reason of retirement. Except as
otherwise provided in Section 4.2, 4.3 or 4.4, Executive's employment under this Agreement may be terminated by giving Executive written notice thereof, effective as of the date provided in
such notice. Upon such termination of the employment of Executive, the Company shall pay to Executive: (i) an amount equal to Executive's Base Salary payable for the remainder of the Term at
the time such payments would otherwise have become due and payable in the absence of such termination at the rate in effect on the date of termination; and (ii) all other amounts to which
Executive is entitled, including (A) subject to the prior approval of the Compensation Committee of the Board of Directors of the Company (which approval shall not be unreasonably withheld) and
subject to the terms of any such bonus or incentive award, any bonus or incentive payment to which the Executive would have been entitled pursuant to Section 3.1(b) hereof (prorated for the
period up to the effective date of termination), provided the targets and other conditions applicable thereto are met, (B) any expense reimbursement amounts accrued to the effective date of
termination, and (C) any amounts under any other benefit plan of the Company, in each case at the time such payments would otherwise have become due and payable in the absence of such
termination, and the Company shall have no further obligations to Executive under this Agreement. 


        4.6    Termination by Executive.    Executive may, with or without cause, terminate his employment under this
Agreement by giving the Company at least sixty (60) days' prior written notice of such termination (which may be waived by the Company), and after the effective date of such termination, the
Company shall have no further obligation to Executive under this Agreement, including, without limitation, no obligation to pay any pro-rata amount of any bonus or incentive payment in
respect of the period up to the date of termination. 


5.    Employment Covenants.    


        5.1    Covenant Not to Compete.    Executive recognizes and acknowledges that the Company is placing its confidence
and trust in Executive. Executive, therefore, covenants and agrees that during the Applicable Non-Compete Period (as defined below) Executive shall not, either directly or indirectly,
without the prior written consent of the Board: 



	A.
	Engage
in or carry on any business or in any way become associated with any business which is similar to or is in competition with the Business of the Company (as such term is used and
defined herein). As used in this Section 5, the term "Business of the Company" shall include all business activities in which the Company is now engaged, including but not limited to, the
purchase of land (or options therefor) for development and the construction of residential homes for resale to consumers and shall further include any business in which the Company is engaged at any
time during the Term;



	B.
	Solicit
the business of any person or entity, on behalf of himself or any other person or entity, which is or has been at any time during the term of this Agreement a customer or
supplier of the Company including, but not limited to, former or present customers or suppliers with whom Executive has had personal contact during, or by reason of, his relationship with the Company;



	C.
	Be
or become an employee, agent, consultant, representative, director or officer of, or be otherwise in any manner associated with, any person, firm, corporation, association or other
entity which is engaged in or is carrying on any business which is similar to or in competition with the Business of the Company;



	D.
	Solicit
for employment or employ any person employed by the Company at any time during the twelve- (12)-month period immediately preceding such solicitation or employment; or 



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	E.
	Be
or become a shareholder, joint venturer, owner (in whole or in part), or partner, or be or become associated with or have any proprietary or financial interest in or of any firm,
corporation, association or other entity which is engaged in or is carrying on any business which is similar to or in competition with the Business of the Company. Notwithstanding the preceding
sentence, passive equity investments by Executive of $25,000 or less in any entity or affiliated group of any entity which is engaged in or is carrying on any business which is similar to or in
competition with the Business of the Company shall not be deemed to violate this Section 5.1. 




        Executive
hereby recognizes and acknowledges that the existing Business of the Company extends throughout the States of Georgia, Tennessee, South Carolina, North Carolina, California,
Arizona, Nevada, Florida and New Jersey and therefore agrees that the covenants not to compete contained in this Section 5.1 shall be applicable in and throughout such states, as well as
throughout such additional areas or states in which the Company may be (or has prepared written plans to be) doing business as of the date of termination of Executive's employment. Executive further
warrants and represents that,
because of his varied skill and abilities, he does not need to compete with the Business of the Company and that this Agreement will not prevent him from earning a livelihood and acknowledges that the
restrictions contained in this Section 5.1 constitute reasonable protections for the Company. 


        As
used in this Section 5.1, "Applicable Non-Compete Period" shall mean: 



          (i)  unless
and until the Executive's employment under this Agreement is terminated prior to the scheduled end of the Term, the period beginning on March 2, 1994 and
ending on the date which is 180 days after the scheduled end of the Term (as such Term may be extended from time to time pursuant to Section 2.1 hereof); 


         (ii)  if
the Executive's employment under this Agreement is terminated pursuant to Section 4.2 hereof or Section 4.3 hereof or for any other reason (other than
as set forth in clause (iii) below), the period beginning on March 2, 1994 and ending on the date which is 180 days after the scheduled end of the Term (as such Term may be
extended from time to time pursuant to Section 2.1 hereof); 


        (iii)  if
the Executive's employment under this Agreement is terminated without "cause", the period beginning on March 2, 1994 and ending on the date of the scheduled
end of the Term (as such Term may be extended from time to time pursuant to Section 2.1 hereof); 


        (iv)  if
on or prior to the date of the scheduled end of the Term (as such Term may be extended from time to time pursuant to Section 2.1 hereof), the Executive
rejects an offer by the Company to extend this Agreement pursuant to Section 2.1 hereof on reasonable terms, the period beginning on March 2, 1994 and ending on the date which is
180 days after the scheduled end of the Term (as such Term may be extended from time to time pursuant to Section 2.1 hereof); and 



         (v)  if
the Company elects not extend this Agreement pursuant to Section 2.1 hereof, the period beginning on March 2, 1994 and ending on the date of the
scheduled end of the Term (as such Term may be extended from time to time pursuant to Section 2.1 hereof); 




        5.2    Trade Secrets and Confidential Information.    Executive recognizes and acknowledges that certain information
including, without limitation, information pertaining to the financial condition of the Company, its systems, methods of doing business, agreements with customers or suppliers or other aspects of the
Business of the Company or which is sufficiently secret to derive economic value from not being disclosed ("Confidential Information") may be made available or otherwise come into the possession of
Executive by reason of his employment with the Company. Accordingly, Executive agrees that he will not (either during or after the term of his employment with the Company) disclose any Confidential
Information to any person, firm, corporation, association or other entity for any reason or purpose whatsoever or make use to his personal advantage or to the advantage of any third party, of 


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any
Confidential Information, without the prior written consent of the Board. Executive shall, upon termination of employment, return to the Company all documents which reflect Confidential
Information (including copies thereof). Notwithstanding anything heretofore stated in this Section 5.2, Executive's obligations under this Section 5.2 shall not, after termination of
Executive's employment with the Company, apply to information which has become generally available to the public without any action or omission of Executive (except that any Confidential Information
which is disclosed to any third party by an employee or representative of the Company who is not authorized to make such disclosure shall be deemed to remain confidential and protectable by Executive
under this Section 5.2). 


        5.3    Records.    All files, records, memoranda and other documents regarding former, existing or prospective
customers of the Company or relating in any manner whatsoever to Confidential Information or the Business of the Company (collectively, "Records"), whether prepared by Executive or otherwise coming
into his possession, shall be the exclusive property of the Company. All Records shall be immediately placed in the physical possession of the Company upon the termination of Executive's employment
with the Company, or at any other time specified by the Board. The retention and use by Executive of duplicates in any form of Records is prohibited after the termination of Executive's employment
with the Company. 


        5.4    Breach.    Executive hereby recognizes and acknowledges that irreparable injury or damage shall result to the
Company in the event of a breach or threatened breach by Executive of any of the terms or provisions of this Section 5, and Executive therefore agrees that the Company shall be entitled to an
injunction restraining Executive from engaging in any activity constituting such breach or threatened breach. Nothing contained herein shall be construed as prohibiting the Company from pursuing any
other remedies available to the Company at law or in equity for such breach or threatened breach, including but not limited to, the recovery of damages from Executive and, if Executive is an employee
of the Company, the termination of his employment with the Company in accordance with the terms and provisions of this Agreement. 


        5.5    Survival.    Notwithstanding the termination of the employment of Executive or the termination of this
Agreement, the provisions of this Section 5 shall survive and be binding upon Executive unless a written agreement which specifically refers to the termination of the obligations and covenants
of this Section 5 is executed by the Company. 


6.    Miscellaneous    


        6.1    Notices.    Any notices to be given hereunder by either party to the other may be effected either by personal
delivery in writing, via facsimile transmission or by mail, registered or certified, postage prepaid with return receipt requested. Notices shall be addressed to the parties as follows: 



	If to the Company:	 	Beazer Homes USA, Inc.

5775 Peachtree Dunwoody Road

Suite C-550

Atlanta, Georgia 30342

Attn: President

Facsimile: 404-250-3428
	

If to Executive:	
 	

John Skelton

c/o Beazer Homes USA, Inc.

5775 Peachtree Dunwoody Rd.

Suite C-550

Atlanta, GA 30342






        Any
party may change his or its address by written notice in accordance with this Section 6.1. Notices delivered personally shall be deemed communicated as of actual receipt;
notices sent via 


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facsimile
transmission shall be deemed communicated as of receipt by the sender of written confirmation of transmission thereof; mailed notices shall be deemed communicated as of three (3) days
after proper mailing. 


        6.2    Inclusion of Entire Agreement Herein.    This Agreement supersedes any and all other prior or contemporaneous
agreements, either oral or in writing, between the parties hereto with respect to the subject matter hereof including, without limitation, the 1994 Agreement, and this Agreement contains all of the
covenants and agreements between the parties with respect to employment of Executive by the Company, provided,  however, that nothing contained herein shall
impair Executive's right to (i) any salary, bonus or other payments accrued through the effective
date hereof and owing to Executive
pursuant to the 1994 Agreement or (ii) any award of restricted stock and grants of options to acquire shares of the Company's common stock referred to in the 1994 Agreement and the award
letters delivered by the Company to Executive in connection therewith. 


        6.3    LAW GOVERNING AGREEMENT.    THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF
THE STATE OF DELAWARE. 


        6.4    Waivers.    No waiver at any time of any term or provision of this Agreement shall be construed as a waiver of
any other term or provision of this Agreement and that a waiver at any time of any term or provision of this Agreement shall not be construed as a waiver at any subsequent time of the same term or
provision. 


        6.5    Amendments.    Except as otherwise provided in Section 6.6 hereof, no amendment or modification of this
Agreement shall be deemed effective unless and until executed in writing by each party hereto. 


        6.6    Severability and Limitation.    All agreements and covenants contained herein are severable and in the event
any of them shall be held to be invalid by any competent court, this Agreement shall be interpreted as if such invalid agreements or covenants were not contained herein. Should any court or other
legally constituted authority determine that for any such agreement or covenant to be effective that it must be modified to limit its duration or scope, the parties hereto shall consider such
agreement or covenant to be amended or modified with respect to duration and / or scope so as to comply with the orders of any such court or other legally constituted authority, and as to all other
portions of such agreement or covenants they shall remain in full force and effect as originally written. 


        6.7    Headings.    All headings set forth in this Agreement are intended for convenience only and shall not control
or affect the meaning, construction or effect of this Agreement or of any of the provisions hereof. 


        6.8    Assignment.    The Company shall have the right to assign this Agreement and to delegate all of its rights,
duties and obligations hereunder to any entity which controls the Company, which the Company controls or which may be the result of the merger, consolidation, acquisition or reorganization of the
Company and another entity. Executive agrees that this Agreement is personal to him and his rights and interests hereunder may not be assigned, nor may his obligations and duties hereunder be
delegated (except as to delegation in the normal course of operation of the Company), and any attempted assignment or delegation in violation of this provision shall be void. 


        6.9    Arbitration.    All controversies which may arise between the parties hereto including, but not limited to,
those arising out of or related to this Agreement shall be determined by binding arbitration applying the laws of the State of Delaware as set forth in Section 6.3 hereof. Any arbitration
pursuant to this Agreement shall be conducted in New York City before the American Arbitration Association in accordance with its arbitration rules. The arbitration shall be final and binding upon all
the parties (so long as the award was not procured by corruption, fraud or undue means) and the arbitrator's award shall not be required to include factual findings or legal reasoning. Nothing in this
Section 6.9 will prevent either party from resorting to judicial proceedings if interim injunctive relief under the laws of 


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the
State of New York from a court is necessary to prevent serious and irreparable injury to one of the parties. 


        6.10    Counterparts.    This Agreement may be executed via facsimile transmission signature and in counterparts, each
of which shall be deemed to be an original but all of which together will constitute one and the same instrument. 


        6.11    Board of Director Determinations.    All matters to be determined by the Board pursuant to the terms of this
Agreement shall be determined by the members of the Board or any duly authorized committee thereof without the vote of Executive. 



        [signature
page follows] 


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        IN
WITNESS WHEREOF, the parties hereto have executed this AMENDED AND RESTATED EMPLOYMENT AGREEMENT effective as of the date first written above. 



	 	 	BEAZER HOMES USA, INC.
	

 	
 	

By:	
 	

/s/  IAN J. MCCARTHY      

	 	 	Name:	 	Ian J. McCarthy
	 	 	Title:	 	President/CEO
	

 	
 	

EXECUTIVE
	

 	
 	

/s/  JOHN SKELTON      
 John Skelton




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AMENDED AND RESTATED EMPLOYMENT AGREEMENT