THE BORROWER
EARNED AFTER MARCH 31, 2004 (EXCLUDING ANY QUARTER IN WHICH THERE IS A LOSS),
AND (III) FIFTY PERCENT (50%) OF THE NET PROCEEDS RECEIVED AFTER MARCH 31, 2004
BY THE BORROWER OR ANY SUBSIDIARY FROM THE SALE OR ISSUANCE OF ANY OF ITS COMMON
EQUITY.
NOTWITHSTANDING THE FOREGOING, IN THE EVENT THAT THE BORROWER SHALL AT
ANY TIME CONSUMMATE AN ACQUISITION FOR A PURCHASE PRICE OR OTHER CONSIDERATION
EQUALING OR EXCEEDING $100,000,000, THE MINIMUM CONSOLIDATED TANGIBLE NET WORTH
SHALL BE INCREASED TO THE SUM OF (I) 80% OF THE BORROWER'S CONSOLIDATED TANGIBLE
NET WORTH IMMEDIATELY FOLLOWING THE CLOSING OF SUCH ACQUISITION, (II) AN AMOUNT
EQUAL TO 50% OF THE CUMULATIVE NET INCOME OF THE BORROWER EARNED AFTER THE
CLOSING OF SUCH ACQUISITION (EXCLUDING ANY QUARTER IN WHICH THERE IS A LOSS) AND
(III) 50% OF THE NET PROCEEDS RECEIVED AFTER THE CLOSING OF SUCH ACQUISITION BY
THE BORROWER OR ANY SUBSIDIARY FOR THE SALE OR ISSUANCE OF ITS COMMON EQUITY.
SECTION 7.02
LEVERAGE RATIO.
THE BORROWER WILL NOT PERMIT THE RATIO OF
CONSOLIDATED DEBT TO CONSOLIDATED TANGIBLE NET WORTH TO EXCEED (A) 2.25 TO 1.00
AT ANY TIME THAT THE BORROWER MAINTAINS AN INTEREST COVERAGE RATIO OF AT LEAST
2.5 TO 1.0 OR (B) 2.0 TO 1.0 AT ANY OTHER TIME.
FOR PURPOSES OF THIS SECTION
7.02, CONSOLIDATED TANGIBLE NET WORTH SHALL EXCLUDE THE BORROWER'S AND
GUARANTORS' INVESTMENTS IN JOINT VENTURES AND IN SUBSIDIARIES THAT ARE NOT
GUARANTORS.
SECTION 7.03
BORROWING BASE DEBT.
AT ANY TIME AT WHICH THE SENIOR UNSECURED
PUBLIC DEBT OF THE BORROWER DOES NOT HAVE A RATING OF BBB- OR HIGHER FROM S&P OR
BAA3 OR HIGHER FROM
62
MOODY'S, THE BORROWER WILL NOT PERMIT THE OUTSTANDING AMOUNT OF THE BORROWING
BASE DEBT TO EXCEED THE BORROWING BASE.
SECTION 7.04
INTEREST COVERAGE RATIO.
THE BORROWER SHALL MAINTAIN AN INTEREST
COVERAGE RATIO OF NOT LESS THAN 2.0 TO 1.0, WHICH RATIO SHALL BE DETERMINED AS
OF THE LAST DAY OF EACH FISCAL QUARTER FOR THE FOUR-QUARTER PERIOD ENDING ON
SUCH DAY.
SECTION 7.05
LAND INVENTORY.
THE BORROWER SHALL NOT PERMIT THE RATIO OF (I)
ADJUSTED LAND VALUE TO (II) THE SUM OF (A) CONSOLIDATED TANGIBLE NET WORTH PLUS
(B) FIFTY PERCENT (50%) OF CONSOLIDATED SUBORDINATED DEBT TO EXCEED 1.0 TO 1.0.
ARTICLE VIII
EVENTS OF DEFAULT
SECTION 8.01
EVENTS OF DEFAULT.
IF ANY OF THE FOLLOWING EVENTS SHALL OCCUR:
(1)
The Borrower shall fail to pay (a) the
principal of any Note, or any amount of a commitment or other fee, as and when
due and payable or (b) interest on any Note or any amount of any commitment fee
or other fee within five (5) Business Days after the same is due and payable;
(2)
Any representation or warranty made or
deemed made by the Borrower or by any Guarantor in any Loan Document or which is
contained in any certificate, document, opinion, or financial or other statement
furnished at any time under or in connection with this Agreement shall prove to
have