the activities of Ryland Mortgage Company and
its Subsidiaries and of the Insurance Segment but excludes the Limited-Purpose
Subsidiaries.
"Leverage Ratio" means, at any date, the ratio of (a) Consolidated Indebtedness
at such date, less unrestricted cash of the Borrower and Guarantors in excess of
$25,000,000 but not to exceed $300,000,000 to (b) the sum of Consolidated
Indebtedness and Consolidated Tangible Net Worth at such date.
(B)
THE FOLLOWING DEFINED TERMS ARE HEREBY ADDED TO ARTICLE 1 OF THE
CREDIT AGREEMENT:
"Coverage Test Failure Quarter" is defined in Section 6.25(b).
"Insurance Segment" means the business segment of the Borrower and its
Subsidiaries engaged in the insurance business.
"Interest Coverage Ratio" means, as of the end of each fiscal quarter of the
Borrower for the twelve-month period ending on such date, the ratio of (a)
EBITDA for the applicable period to (b) Consolidated Interest Incurred for the
applicable period, less interest income included in revenues in determining
Consolidated Net Income for such period.
"Interest Coverage Test" is defined in Section 6.25(b).
"Permitted Leverage Ratio" means, at the date hereof, 57.5%, as such amount may
hereafter be adjusted from time to time as provided in Section 6.25.
2.
REDUCTION OF AGGREGATE COMMITMENT.
PURSUANT TO SECTION 2.5.2 OF
THE CREDIT AGREEMENT, THE AGGREGATE COMMITMENT IS HEREBY REDUCED FROM
$1,133,500,000 TO $750,000,000, ALLOCATED TO EACH LENDER'S COMMITMENT RATABLY.
THE AMOUNTS OF THE REDUCED COMMITMENTS OF THE LENDERS ARE SET FORTH IN SCHEDULE
I HERETO.
3.
PRICING.
THE PRICING SCHEDULE ATTACHED TO THE CREDIT AGREEMENT
IS HEREBY DELETED AND REPLACED BY THE PRICING SCHEDULE ATTACHED HERETO.
2
4.
LIMITATION ON GUARANTEE OBLIGATIONS.
SECTION 6.13(A) OF THE
CREDIT AGREEMENT IS HEREBY AMENDED AND RESTATED IN ITS ENTIRETY AS FOLLOWS:
(A)
THE BORROWER AND ANY GUARANTOR MAY INCUR GUARANTEE OBLIGATIONS,
NOT TO EXCEED (I) $65,000,000 IN THE AGGREGATE AT ANY TIME IN RESPECT OF
OBLIGATIONS OF ENTITIES IN THE INSURANCE SEGMENT AND (II) $35,000,000 IN THE
AGGREGATE AT ANY TIME IN RESPECT OF OBLIGATIONS OF ENTITIES IN THE FINANCIAL
SERVICES SEGMENT (OTHER THAN THE INSURANCE SEGMENT).
5.
CONSOLIDATED TANGIBLE NET WORTH.
SECTION 6.24 OF THE CREDIT
AGREEMENT IS HEREBY AMENDED AND RESTATED IN ITS ENTIRETY AS FOLLOWS:
6.24
Consolidated Tangible Net Worth.
The Borrower shall not permit
Consolidated Tangible Net Worth at any time to be less than the sum of (a)
$1,000,000,000 plus (b) 50% of the Consolidated Net Income (without deduction
for losses sustained during any fiscal quarter) for each fiscal quarter
subsequent to the fiscal quarter ended June 30, 2007, plus (c) 50% of the net
proceeds from any equity offerings of the Borrower from and after June 30,
2007.
Notwithstanding the foregoing, in the event that the Borrower shall at
any time engage in an Acquisition with a purchase price (determined under GAAP)
equaling or exceeding $100,000,000, the minimum Consolidated Tangible Net Worth
requirement shall be adjusted to the sum of (i) 80% of Consolidated Tangible Net
Worth at the end of the fiscal quarter in which the closing of such Acquisition