Document:

Thirteenth Supplemental Indenture

 Exhibit 4.1 

 
  

 
 BEAZER HOMES USA, INC. AND THE
SUBSIDIARY GUARANTORS PARTY HERETO, 
 9.125% Senior Notes due 2018 

 
  

Thirteenth Supplement Indenture 

Dated as of May 20, 2010 
  

 
 U.S. BANK
NATIONAL ASSOCIATION, 
 Trustee 
  

 
  

 TABLE OF CONTENTS 

 

					
	 	  	 	  	 Page

	
	 ARTICLE ONE
  

The 9.125% Senior Notes due 2018

			
	 Section 1.01
	  	 Designation of 9.125% Senior Notes due 2018
	  	2
	 Section 1.02
	  	 Interest
	  	2
	 Section 1.03
	  	 Redemption
	  	2
	 Section 1.04
	  	 Maturity
	  	2
	 Section 1.05
	  	 Restrictive Legends
	  	2
	 Section 1.06
	  	 Other Terms of the Notes
	  	3
	
	 ARTICLE TWO
  

Certain Definitions
  

ARTICLE THREE
  

Covenants

			
	 Section 3.01
	  	 Reports
	  	21
	 Section 3.02
	  	 Limitations on Restricted Payments
	  	21
	 Section 3.03
	  	 Change of Control
	  	23
	 Section 3.04
	  	 Limitations on Secured Indebtedness
	  	25
	 Section 3.05
	  	 Limitations on Additional Indebtedness
	  	26
	 Section 3.06
	  	 Limitations on Mergers and Consolidations
	  	28
	
	 ARTICLE FOUR
  

Subsidiary Guarantees

			
	 Section 4.01
	  	 Subsidiary Guarantees
	  	29
	 Section 4.02
	  	 Execution and Delivery of Subsidiary Guarantees
	  	31
	 Section 4.03
	  	 Additional Subsidiary Guarantors
	  	31
	 Section 4.04
	  	 Release of a Subsidiary Guarantor
	  	32
	 Section 4.05
	  	 Waiver of Subrogation; Right of Contribution
	  	32
	
	 ARTICLE FIVE
  

Miscellaneous

			
	 Section 5.01
	  	 Defeasance Upon Deposit of Moneys or U.S. Government Obligations
	  	33

  

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	 Section 5.02
	  	 Events of Default
	  	36
	 Section 5.03
	  	 Amendment, Supplement and Waiver
	  	38
	 Section 5.04
	  	 Compliance Certificate
	  	40
	 Section 5.05
	  	 Indenture
	  	41
	 Section 5.06
	  	 Notices
	  	41
	 Section 5.07
	  	 No Personal Liability of Incorporators, Shareholders, Officers, Directors or Employees
	  	42
	 Section 5.08
	  	 Governing Law
	  	42
	 Section 5.09
	  	 No Adverse Interpretation of Other Agreements
	  	42
	 Section 5.10
	  	 Successors and Assigns
	  	42
	 Section 5.11
	  	 Duplicate Originals
	  	42
	 Section 5.12
	  	 Severability
	  	42
	 Section 5.13
	  	 Trustee Not Responsible for Recitals
	  	43
	 Section 5.14
	  	 Trustee Rights
	  	43
		
	SCHEDULES	  	
			
	Schedule I	  	 Subsidiary Guarantors
	  	
		
	EXHIBITS	  	
			
	Exhibit A	  	 Form of Note
	  	

  

 ii 

 THIRTEENTH SUPPLEMENTAL INDENTURE, dated as of May 20, 2010 (the “Supplemental
Indenture”), to the Indenture, dated as of April 17, 2002 (as amended, modified or supplemented from time to time prior to the date hereof in accordance therewith, the “Base Indenture” and, together with this
Supplemental Indenture, the “Indenture”), by and among BEAZER HOMES USA, INC., a Delaware corporation (the “Company”), the Subsidiary Guarantors (as defined herein) and U.S. BANK NATIONAL ASSOCIATION, as trustee
(the “Trustee”). 
 Each party agrees as follows for the benefit of the other party and for the equal and
ratable benefit of the holders of Notes (as defined herein). 
 WHEREAS, the Company, the Subsidiary Guarantors and the Trustee
have duly authorized the execution and delivery of the Base Indenture to provide for the issuance from time to time of senior debt securities (“Securities”) to be issued in one or more series as in the Base Indenture provided;

 WHEREAS, the Company and the Subsidiary Guarantors desire and have requested the Trustee to join them in the execution and
delivery of this Supplemental Indenture in order to establish and provide for the issuance by the Company of a series of Securities designated as its 9.125% Senior Notes due 2018, in the initial aggregate principal amount of $300,000,000. The 9.125%
Senior Notes due 2018 shall be substantially in the form attached hereto as Exhibit A (the “Notes”), guaranteed by the Subsidiary Guarantors, on the terms set forth herein; 

WHEREAS, Section 2.01 of the Base Indenture provides that a supplemental indenture may be entered into by the Company, the
Subsidiary Guarantors and the Trustee for such purpose provided certain conditions are met; 
 WHEREAS, the conditions set forth
in the Base Indenture for the execution and delivery of this Supplemental Indenture have been complied with; and 
 WHEREAS, all
things necessary to make this Supplemental Indenture a valid agreement of the Company, the Subsidiary Guarantors and the Trustee, in accordance with its terms, and a valid amendment of, and supplement to, the Base Indenture have been done.

 NOW, THEREFORE: 

In consideration of the premises and the purchase and acceptance of the Notes by the holders thereof, the Company and the Subsidiary
Guarantors mutually covenant and agree with the Trustee, for the equal and ratable benefit of the Holders, that the Base Indenture is supplemented and amended, to the extent expressed herein, as follows: 

 ARTICLE ONE 

The 9.125% Senior Notes due 2018 

Section 1.01 Designation of 9.125% Senior Notes due 2018. The changes, modifications and supplements to the Base Indenture
effected by this Supplemental Indenture shall be applicable only with respect to, and govern the terms of, the Notes, which shall not be limited in aggregate principal amount, and shall not apply to any other Securities that may be issued under the
Base Indenture unless a supplemental indenture with respect to such other Securities specifically incorporates such changes, modifications and supplements. Pursuant to this Supplemental Indenture, there is hereby created and designated a series of
Securities under the Base Indenture entitled “9.125% Senior Notes due 2018.” The Notes shall be in the form of Exhibit A hereto. The Notes shall be guaranteed by the Subsidiary Guarantors as provided herein. The Notes may bear an
appropriate legend regarding original issue discount for federal income tax purposes. Subject to the terms herein, including compliance with Section 3.05 hereof, the Company may, at its option, without consent from the Holders, issue additional
Notes from time to time. 
 Section 1.02 Interest. The Notes shall bear interest at the rate set forth in the Notes.
Interest on the Notes shall be payable to the persons in whose name the Notes are registered at the close of business on the Record Date for such interest payment. The date from which interest shall accrue for each Note shall be the most recent to
occur of May 20, 2010 or the most recent Interest Payment Date. 
 Section 1.03 Redemption. The Company, at its
option, may redeem the Notes in accordance with the provisions set forth in the Notes and in accordance with the provisions of the Base Indenture, including, without limitation, Article Three thereof. 

Section 1.04 Maturity. The date on which the principal of the Notes is payable, unless accelerated pursuant to the terms hereof,
shall be June 15, 2018. 
 Section 1.05 Restrictive Legends. Section 2.15(f) of the Base Indenture is hereby
replaced in its entirety as follows: 
 “(f) Each Global Security shall also bear the following legend on the face thereof:

 THIS GLOBAL NOTE IS HELD BY THE DEPOSITARY (AS DEFINED IN THE INDENTURE GOVERNING THIS NOTE) OR ITS NOMINEE IN CUSTODY FOR THE
BENEFIT OF THE BENEFICIAL OWNERS HEREOF, AND IS NOT TRANSFERABLE TO ANY PERSON UNDER ANY CIRCUMSTANCES EXCEPT THAT (I) THE TRUSTEE MAY MAKE SUCH NOTATIONS HEREON AS MAY BE REQUIRED PURSUANT TO SECTION 2.15(d) OF THE INDENTURE, (II) THIS GLOBAL
NOTE MAY BE EXCHANGED IN WHOLE BUT NOT IN PART PURSUANT TO SECTION 2.15(b) OF THE INDENTURE, (III) THIS GLOBAL NOTE MAY BE DELIVERED TO THE TRUSTEE FOR CANCELLATION PURSUANT TO SECTION 2.10 OF THE INDENTURE AND (IV) THIS GLOBAL NOTE MAY

  

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BE TRANSFERRED TO A SUCCESSOR DEPOSITARY WITH THE PRIOR WRITTEN CONSENT OF THE COMPANY. UNLESS AND UNTIL IT IS EXCHANGED IN WHOLE OR IN PART FOR NOTES IN DEFINITIVE FORM, THIS NOTE MAY NOT BE
TRANSFERRED EXCEPT AS A WHOLE BY THE DEPOSITARY TO A NOMINEE OF THE DEPOSITARY OR BY A NOMINEE OF THE DEPOSITARY TO THE DEPOSITARY OR ANOTHER NOMINEE OF THE DEPOSITARY OR BY THE DEPOSITARY OR ANY SUCH NOMINEE TO A SUCCESSOR DEPOSITARY OR A NOMINEE
OF SUCH SUCCESSOR DEPOSITARY. UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY (55 WATER STREET, NEW YORK, NEW YORK) (“DTC”) TO THE COMPANY OR ITS AGENT FOR REGISTRATION OF TRANSFER,
EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR SUCH OTHER NAME AS MAY BE REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR SUCH OTHER ENTITY AS
MAY BE REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.”

 Section 1.06 Other Terms of the Notes. 

Without limiting the foregoing provisions of this Article One, the terms of the Notes shall be as set forth in the form of Note set forth
in Exhibit A hereto and as provided in the Base Indenture. 
 The Notes shall be payable and may be presented for
payment, purchase, conversion, registration of transfer and exchange, without service charge, at the office of the Company maintained for such purpose in New York, New York, which shall initially be the office or agency of the Trustee. 

ARTICLE TWO 

Certain Definitions 

The following terms have the meanings set forth below in this Supplemental Indenture. Capitalized terms used but not otherwise
defined herein shall have the meanings ascribed to such terms in the Base Indenture. To the extent terms defined herein differ from the Base Indenture the terms defined herein will govern. 

“Acquired Indebtedness” means Indebtedness of any Person and its Subsidiaries existing at the time such Person became a
Subsidiary of the Company (or such Person is merged with or into the Company or one of the Company’s Subsidiaries) or assumed in connection with the acquisition of assets from any such Person, including, without limitation, Indebtedness
Incurred 
  

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in connection with, or in contemplation of (i) such Person being merged with or into or becoming a Subsidiary of the Company or one of its Subsidiaries (but excluding Indebtedness of such
Person which is extinguished, retired or repaid in connection with such Person being merged with or into or becoming a Subsidiary of the Company or one of its Subsidiaries) or (ii) such acquisition of assets from any such Person. 

“Adjusted Consolidated Tangible Net Worth” of the Company means Consolidated Tangible Net Worth plus the amount of any
Mandatory Convertible Notes. 
 “Adjusted Indebtedness” of the Company means the Company’s Indebtedness
minus the amount of any Mandatory Convertible Notes. 
 “Affiliate” of any Person means any other Person
directly or indirectly controlling or controlled by, or under direct or indirect common control with, such Person. For purposes hereof, each executive officer and director of the Company and each Subsidiary of the Company will be an Affiliate of the
Company. In addition, for purposes hereof, control of a Person means the power to direct the management and policies of such Person, directly or indirectly, whether through the ownership of voting securities, by contract or otherwise.
Notwithstanding the foregoing, the term “Affiliate” will not include, with respect to the Company or any Restricted Subsidiary which is a Wholly Owned Subsidiary of the Company, any Restricted Subsidiary which is a Wholly Owned Subsidiary
of the Company. 
 “Applicable Premium” means, with respect to a Note at any redemption date, the greater of
(i) 1.00% of the principal amount of such Note and (ii) the excess of (a) the present value at such redemption date of (1) the redemption price of such Note on June 15, 2014 (such redemption price being described under
Section 5(b) of such Note, exclusive of any accrued interest) plus (2) all required remaining scheduled interest payments due on such Note through June 15, 2014 (but excluding accrued and unpaid interest to the redemption date),
computed using a discount rate equal to the Treasury Rate plus 0.50% per annum, over (b) the principal amount of such Note on such redemption date. 

“Asset Sale” for any Person means the sale, transfer, lease, conveyance or other disposition (including, without
limitation, by merger, consolidation or sale and leaseback transaction, and whether by operation of law or otherwise) of any of that Person’s assets (including, without limitation, the sale or other disposition of Capital Stock of any
Subsidiary of such Person, whether by such Person or such Subsidiary), whether owned on the date hereof or subsequently acquired in one transaction or a series of related transactions, in which such Person and/or its Subsidiaries receive cash and/or
other consideration (including, without limitation, the unconditional assumption of Indebtedness of such Person and/or its Subsidiaries) having an aggregate Fair Market Value of $5.0 million or more as to each such transaction or series of related
transactions; provided, however, that none of the following shall constitute an Asset Sale: 
 (i) a
transaction or series of related transactions that results in a Change of Control; 
 (ii) sales of homes or land in the
ordinary course of business; 
  

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 (iii) sales, leases, conveyances or other dispositions, including, without limitation,
exchanges or swaps, of real estate or other assets, in each case in the ordinary course of business, for development or disposition of the Company’s or any of its Subsidiaries’ projects; 

(iv) sales, leases, sale-leasebacks or other dispositions of amenities, model homes and other improvements at the Company’s or its
Subsidiaries’ projects in the ordinary course of business; 
 (v) transactions between the Company and any of its
Restricted Subsidiaries, or among such Restricted Subsidiaries; 
 (vi) a transaction involving the sale of Capital Stock of, or
the disposition of assets in, an Unrestricted Subsidiary; 
 (vii) any exchange or swap of assets of the Company or any
Restricted Subsidiary for assets (including Capital Stock of any Person that is or will be a Restricted Subsidiary following receipt thereof) that (i) are to be used by the Company or any Restricted Subsidiary in the ordinary course of business
and (ii) have a Fair Market Value not less than the Fair Market Value of the assets exchanged or swapped; 
 (viii) any
disposition of Cash Equivalents or obsolete or worn out equipment, in each case, in the ordinary course of business; 
 (ix) the
sale or other disposition of assets no longer used or useful in the conduct of business of the Company or any of its Restricted Subsidiaries; and 

(x) the making of any Restricted Payment or Permitted Investment that is permitted to be made, and is made, under Section 3.02
hereof 
 “Bankruptcy Law” means title 11 of the United States Code, as amended, or any similar federal or
state law for the relief of debtors. 
 “Book Value” means, with respect to any asset of the Company or any of
its Subsidiaries, the book value thereof as reflected in the most recent consolidated financial statements of the Company filed with SEC (or if such asset has been acquired after the date of such financial statements, the then-current book value
thereof as reasonably determined by the Company consistent with recent practices). 
 “Business Day” means any
day other than a Legal Holiday. 
 “Capital Stock” of any Person means any and all shares, rights to purchase,
warrants or options (whether or not currently exercisable), participations, or other equivalents of or interests in (however designated and whether voting or non-voting) the equity (which includes, but is not limited to, common stock, preferred
stock and partnership and joint venture interests) of such Person (excluding any debt securities that are convertible into, or exchangeable for, such equity). 

“Capitalized Lease Obligations” of any Person means the obligations of such Person to pay rent or other amounts under a
lease that is required to be capitalized for financial reporting 
  

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purposes in accordance with GAAP, and the amount of such obligation will be the capitalized amount thereof determined in accordance with GAAP. 

“Cash Equivalents” means any security or instrument that constitutes a cash equivalent under GAAP, including any of the
following: 
 (i) direct obligations of the United States or any agency thereof or obligations guaranteed by the United States
or any agency thereof, in each case maturing within one year of the date of acquisition thereof; 
 (ii) certificates of
deposit, time deposits, bankers acceptances and other obligations placed with commercial banks organized under the laws of the United States of America or any state thereof, or branches or agencies of foreign banks licensed under the laws of the
United States of America or any state thereof, having a short-term rating of not less than A- by Moody’s or S&P at the time of acquisition, and having a maturity of not more than one year; 

(iii) commercial paper rated at least P-1, A-1 or the equivalent thereof by Moody’s or S&P, respectively, and in each case and
maturing not more than one year from the date of the acquisition thereof; 
 (iv) repurchase agreements or money-market accounts
which are fully secured by direct obligations of the United States or any agency thereof; and 
 (v) investments in money market
funds (a) substantially all of the assets of which consist of investments described in the foregoing clauses (i) through (iv) or (b) which (1) have total net assets of at least $2.0 billion, (2) have investment
objectives and policies that substantially conform with the Company’s investment policy as in effect from time to time, (3) purchase only first-tier or U.S. government obligations as defined by Rule 2a-7 of the SEC promulgated under the
Investment Company Act of 1940 and (4) otherwise comply with such Rule 2a-7. 
 “Change of Control” means
any of the following: 
 (i) the sale, transfer, lease, conveyance or other disposition (in one transaction or a series of
transactions) of all or substantially all of the Company’s assets as an entirety or substantially as an entirety to any Person or “group” (within the meaning of Section 13(d)(3) of the Exchange Act); provided that a
transaction where the holders of all classes of Common Equity of the Company immediately prior to such transaction own, directly or indirectly, 50% or more of the aggregate voting power of all classes of Common Equity of such Person or group
immediately after such transaction will not be a Change of Control; 
 (ii) the acquisition by the Company and/or any of its
Subsidiaries of 50% or more of the aggregate voting power of all classes of Common Equity of the Company in one transaction or a series of related transactions; 

(iii) the liquidation or dissolution of the Company; provided that a liquidation or dissolution of the Company which is
part of a transaction or series of related transactions that 
  

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does not constitute a Change of Control under the “provided” clause of clause (i) above will not constitute a Change of Control under this clause (iii); 

(iv) any transaction or a series of related transactions (as a result of a tender offer, merger, consolidation or otherwise) that results
in, or that is in connection with, (a) any Person, including a “group” (within the meaning of Section 13(d)(3) of the Exchange Act) acquiring “beneficial ownership” (as defined in Rule 13d-3 under the Exchange Act),
directly or indirectly, of 50% or more of the aggregate voting power of all classes of Common Equity of the Company or of any Person that possesses “beneficial ownership” (as defined in Rule 13d-3 under the Exchange Act), directly or
indirectly, of 50% or more of the aggregate voting power of all classes of Common Equity of the Company or (b) less than 50% (measured by the aggregate voting power of all classes) of the Common Equity of the Company being registered under
Section 12(b) or 12(g) of the Exchange Act; 
 (v) a majority of the Board of Directors of the Company not being comprised
of Continuing Directors; or 
 (vi) a change of control shall occur as defined in the instrument governing any publicly-traded
debt securities of the Company which requires the Company to repay or repurchase such debt securities. 
 “Change of
Control Offer” shall have the meaning set forth in Section 3.03(a) hereof. 
 “Change of Control Payment
Date” shall have the meaning set forth in Section 3.03(a) hereof. 
 “Change of Control Price”
shall have the meaning set forth in Section 3.03(a) hereof. 
 “Common Equity” of any Person means all
Capital Stock of such Person that is generally entitled to (i) vote in the election of directors of such Person or (ii) if such Person is not a corporation, vote or otherwise participate in the selection of the governing body, partners,
managers or others that will control the management and policies of such Person. 
 “Consolidated Cash Flow Available
for Fixed Charges” of the Company and its Restricted Subsidiaries means for any period, the sum of the amounts for such period of: 

(i) Consolidated Net Income, plus 

(ii) Consolidated Income Tax Expense (without regard to income tax expense or credits attributable to extraordinary and nonrecurring
gains or losses on Asset Sales), plus 
 (iii) Consolidated Interest Expense, plus 

(iv) all depreciation, and, without duplication, amortization (including, without limitation, capitalized interest amortized to cost of
sales), plus 
 (v) all other non-cash items reducing Consolidated Net Income during such period, minus

  

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all other non-cash items increasing Consolidated Net Income during such period; all as determined on a consolidated basis for the Company and its Restricted Subsidiaries in accordance with GAAP.

 “Consolidated Fixed Charge Coverage Ratio” of the Company means, with respect to any determination date, the
ratio of (i) Consolidated Cash Flow Available for Fixed Charges of the Company for the prior four full fiscal quarters for which financial results have been reported immediately preceding the determination date to (ii) the aggregate
Consolidated Interest Incurred of the Company for the prior four full fiscal quarters for which financial results have been reported immediately preceding the determination date; provided that: 

(i) with respect to any Indebtedness Incurred during, and remaining outstanding at the end of, such four full fiscal quarters period,
such Indebtedness will be assumed to have been incurred as of the first day of such four full fiscal quarters period; 
 (ii)
with respect to Indebtedness repaid (other than a repayment of revolving credit obligations repaid solely out of operating cash flows) during such four full fiscal quarters period, such Indebtedness will be assumed to have been repaid on the first
day of such four full fiscal quarters period; 
 (iii) with respect to the Incurrence of any Acquired Indebtedness, such
Indebtedness and any proceeds therefrom will be assumed to have been Incurred and applied as of the first day of such four full fiscal quarters period, and the results of operations of any Person and any Subsidiary of such Person that, in connection
with or in contemplation of such Incurrence, becomes a Subsidiary of the Company or is merged with or into the Company or one of the Company’s Subsidiaries or whose assets are acquired, will be included, on a pro forma basis, in the calculation
of the Consolidated Fixed Charge Coverage Ratio as if such transaction had occurred on the first day of such four full fiscal quarters period; and 

(iv) with respect to any other transaction pursuant to which any Person becomes a Subsidiary of the Company or is merged with or into the
Company or one of the Company’s Subsidiaries or pursuant to which any Person’s assets are acquired, such Consolidated Fixed Charge Coverage Ratio shall be calculated on a pro forma basis as if such transaction had occurred on the first day
of such four full fiscal quarters period, but only if such transaction would require a pro forma presentation in financial statements prepared pursuant to Rule 11-02 of Regulation S-X under the Securities Act. 

“Consolidated Income Tax Expense” of the Company for any period means the income tax expense of the Company and its
Restricted Subsidiaries for such period, determined on a consolidated basis in accordance with GAAP. 
 “Consolidated
Interest Expense” of the Company for any period means the Interest Expense of the Company and its Restricted Subsidiaries for such period, determined on a consolidated basis in accordance with GAAP. 

 

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 “Consolidated Interest Incurred” of the Company for any period means the
Interest Incurred of the Company and its Restricted Subsidiaries for such period, determined on a consolidated basis in accordance with GAAP. 

“Consolidated Net Income” of the Company for any period means the aggregate net income (or loss) of the Company and its
Restricted Subsidiaries for such period, determined on a consolidated basis in accordance with GAAP; provided that there will be excluded from such net income (to the extent otherwise included therein), without duplication: 

(i) the net income (or loss) of any Person (other than a Restricted Subsidiary) in which any Person (including, without limitation, an
Unrestricted Subsidiary) other than the Company or any Restricted Subsidiary has an ownership interest, except to the extent that any such income has actually been received by the Company or any Restricted Subsidiary in the form of cash dividends or
similar cash distributions during such period, or in any other form but converted to cash during such period; 
 (ii) except to
the extent includable in Consolidated Net Income pursuant to the foregoing clause (i), the net income (or loss) of any Person that accrued prior to the date that (a) such Person becomes a Restricted Subsidiary or is merged with or into or
consolidated with the Company or any of its Restricted Subsidiaries or (b) the assets of such Person are acquired by the Company or any of its Restricted Subsidiaries; 

(iii) the net income of any Restricted Subsidiary to the extent that (but only so long as) the declaration or payment of dividends or
similar distributions by such Restricted Subsidiary of that income is not permitted by operation of the terms of its charter or any agreement, instrument, judgment, decree, order, statute, rule or governmental regulation applicable to that
Restricted Subsidiary during such period; 
 (iv) in the case of a successor to the Company by consolidation, merger or transfer
of its assets, any earnings of the successor prior to such merger, consolidation or transfer of assets; and 
 (v) the gains
(but not losses) realized during such period by the Company or any of its Restricted Subsidiaries resulting from (a) the acquisition of securities issued by the Company or extinguishment of Indebtedness of the Company or any of its Restricted
Subsidiaries, (b) Asset Sales by the Company or any of its Restricted Subsidiaries and (c) other extraordinary items realized by the Company or any of its Restricted Subsidiaries. 

Notwithstanding the foregoing, in calculating Consolidated Net Income, the Company will be entitled to take into consideration the tax
benefits associated with any loss described in clause (v) of the preceding sentence, but only to the extent such tax benefits are actually recognized by the Company or any of its Restricted Subsidiaries during such period;
provided, further, that there will be included in such net income, without duplication, the net income of any Unrestricted Subsidiary to the extent such net income is actually received by the Company or any of its
Restricted Subsidiaries in the form of cash dividends or similar cash distributions during such period, or in any other form but converted to cash during such period. 

 

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 “Consolidated Tangible Assets” of the Company as of any date means the
total amount of assets of the Company and its Restricted Subsidiaries (less applicable reserves) on a consolidated basis at the end of the fiscal quarter immediately preceding such date, as determined in accordance with GAAP, less:
(i) Intangible Assets and (ii) appropriate adjustments on account of minority interests of other Persons holding equity investments in Restricted Subsidiaries, in the case of each of clauses (i) and (ii) above, as reflected on
the consolidated balance sheet of the Company and its Restricted Subsidiaries as of the end of the fiscal quarter immediately preceding such date. 

“Consolidated Tangible Net Worth” of the Company as of any date means the stockholders’ equity (including any
Preferred Stock that is classified as equity under GAAP, other than Disqualified Stock) of the Company and its Restricted Subsidiaries on a consolidated basis at the end of the fiscal quarter immediately preceding such date, as determined in
accordance with GAAP, plus any amount of unvested deferred compensation included, in accordance with GAAP, as an offset to stockholders’ equity, less the amount of Intangible Assets reflected on the consolidated balance sheet of the Company and
its Restricted Subsidiaries as of the end of the fiscal quarter immediately preceding such date. 
 “Continuing
Director” means at any date a member of the Board of Directors of the Company who: 
 (i) was a member of the Board of
Directors of the Company on the Issue Date; or 
 (ii) was nominated for election or elected to the Board of Directors of the
Company with the affirmative vote of at least a majority of the directors who were Continuing Directors at the time of such nomination or election. 

“Covenant Defeasance” shall have the meaning set forth in Section 8.01(c) of the Indenture. 

“Covenant Trigger Date” means the earlier of (i) 24 months from the Issue Date and (ii) the date that the Net
Income Threshold is met. 
 “Credit Facilities” means, with respect to the Company or any of its Restricted
Subsidiaries, one or more debt facilities or other financing arrangements (including, without limitation, commercial paper or letter of credit facilities or indentures) providing for revolving credit loans, term loans, letters of credit or other
Indebtedness (including the Revolving Credit Facility), including any notes, mortgages, guarantees, collateral documents, instruments and agreements executed in connection therewith, and any amendments, supplements, modifications, extensions,
renewals, restatements or refundings thereof and any indentures, credit facilities, letter of credit facilities or commercial paper facilities that replace, refund or refinance any part of the loans, notes, other credit facilities or commitments
thereunder, including any such replacement, refunding or refinancing facility or indenture that increases the amount permitted to be borrowed thereunder or alters the maturity thereof (provided that such increase in borrowings is permitted by
Section 3.05 hereof) or adds Restricted Subsidiaries as additional borrowers or guarantors thereunder and whether by the same or any other agent, lender or group of lenders. 

 

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 “Custodian” means any receiver, trustee, assignee, liquidator or similar
official under any Bankruptcy Law. 
 “Default” means any event, act or condition that is, or after notice or
the passage of time, or both, would be, an Event of Default. 
 “Definitive Note” means a certificated Note
registered in the name of the Holder thereof and issued in accordance with Section 2.15 of the Indenture, substantially in the form of Exhibit A hereto, except that such Note shall not bear the Global Note Legend and shall not have
the “Schedule of Exchanges of Interests in the Global Note” attached thereto. 
 “Depositary” means,
with respect to the Notes issuable or issued in whole or in part in global form, The Depository Trust Company, and any and all successors thereto appointed as Depositary hereunder and having become such pursuant to the applicable provision of the
Indenture. 
 “Disqualified Stock” means any Capital Stock that, by its terms (or by the terms of any security
into which it is convertible or for which it is exchangeable), or upon the happening of any event, matures or is mandatorily redeemable, pursuant to a sinking fund obligation or otherwise, or is redeemable at the option of the holder thereof, in
whole or in part, on or prior to the final maturity date of the Notes; provided that any Capital Stock which would not constitute Disqualified Stock but for provisions thereof giving holders thereof the right to require the Company to
repurchase or redeem such Capital Stock upon the occurrence of a change of control occurring prior to the final maturity of the Notes will not constitute Disqualified Stock if the change of control provisions applicable to such Capital Stock are no
more favorable to the holders of such Capital Stock than those contained in Section 3.03 hereof and such Capital Stock specifically provides that the Company will not repurchase or redeem (or be required to repurchase or redeem) any such
Capital Stock pursuant to such provisions prior to the Company’s repurchase of Notes pursuant to Section 3.03 hereof. 

“Disqualified Stock Dividend” of any Person means, for any dividend payable with regard to Disqualified Stock issued by
such Person, the amount of such dividend multiplied by a fraction, the numerator of which is one and the denominator of which is one minus the maximum statutory combined federal, state and local income tax rate (expressed as a decimal number between
1 and 0) then applicable to such Person. 
 “Equity Offering” means a public or private equity offering or sale
after the Issue Date by the Company for cash of Capital Stock, other than an offering or sale of Disqualified Stock. 

“Event of Default” has the meaning set forth in Section 6.01(a) of the Indenture. 

“Exchange Act” means the Securities Exchange Act of 1934, as amended, and the rules and regulations of the SEC
promulgated thereunder. 
 “Existing Indebtedness” means all of the Indebtedness of the Company and its
Subsidiaries that is outstanding on the date hereof. 
  

 11 

 “GAAP” means generally accepted accounting principles set forth in the
opinions and interpretations of the Accounting Principles Board of the American Institute of Certified Public Accountants and statements and interpretations of the Financial Accounting Standards Board or in such other statements by such other entity
as may be approved by a significant segment of the accounting profession of the United States, as in effect from time to time. At any time after the Issue Date, the Company may elect to apply IFRS accounting principles in lieu of GAAP and, upon any
such election, references herein to GAAP shall thereafter be construed to mean IFRS (except as otherwise provided herein); provided that any such election, once made, shall be irrevocable; provided, further,
any calculation or determination herein that requires the application of GAAP for periods that include fiscal quarters ended prior to the Company’s election to apply IFRS shall remain as previously calculated or determined in accordance with
GAAP. The Company shall give notice of any such election made in accordance with this definition to the Trustee and the Holders of Notes. 

“Global Notes” means, individually and collectively, each of the Global Notes issued pursuant to the Indenture,
substantially in the form of Exhibit A hereto. 
 “Global Note Legend” means the legend set forth in
Section 2.15(f) of the Indenture, which is required to be placed on all Global Notes issued hereunder. 
 “Hedging
Obligations” of any Person means the obligations of such Person pursuant to any interest rate swap agreement, foreign currency exchange agreement, interest rate collar agreement, option or futures contract or other similar agreement or
arrangement relating to interest rates or foreign exchange rates. 
 “IFRS” means International Financial
Reporting Standards. 
 “Incur” (and derivatives thereof) means to, directly or indirectly, create, incur,
assume, guarantee, extend the maturity of, or otherwise become liable with respect to any Indebtedness; provided, however, that neither the accrual of interest (whether such interest is payable in cash or kind) nor the
accretion of original issue discount shall be considered an Incurrence of Indebtedness. 
 “Indebtedness” of
any Person at any date means, without duplication, 
 (i) all indebtedness of such Person for borrowed money (whether or not the
recourse of the lender is to the whole of the assets of such Person or only to a portion thereof); 
 (ii) all obligations of
such Person evidenced by bonds, debentures, notes or other similar instruments (including a purchase money obligation) given in connection with the acquisition of any businesses, properties or assets of any kind or with services incurred in
connection with capital expenditures (other than any obligation to pay a contingent purchase price which, as of the date of incurrence thereof, is not required to be recorded as a liability in accordance with GAAP); 

(iii) all fixed obligations of such Person in respect of letters of credit or other similar instruments or reimbursement obligations with
respect thereto (other than standby letters of credit or similar instruments issued for the benefit of, or surety, performance, completion or 

 

 12 

 
payment bonds, earnest money notes or similar purpose undertakings or indemnifications issued by, such Person in the ordinary course of business); 

(iv) all obligations of such Person with respect to Hedging Obligations (other than those that fix or cap the interest rate on variable
rate Indebtedness otherwise permitted hereby or that fix the exchange rate in connection with Indebtedness denominated in a foreign currency and otherwise permitted hereby); 

(v) all Capitalized Lease Obligations of such Person; 

(vi) all Indebtedness of others secured by a Lien on any asset of such Person, whether or not such Indebtedness is assumed by such Person
to the extent of the Fair Market Value of such asset; 
 (vii) all Indebtedness of others guaranteed by, or otherwise the
liability of, such Person to the extent of such guarantee or liability; and 
 (viii) all Disqualified Stock issued by such
Person (the amount of Indebtedness represented by any Disqualified Stock will equal the greater of the voluntary or involuntary liquidation preference plus accrued and unpaid dividends); 

provided, that Indebtedness shall not include accrued expenses, accounts payable, trade payables, liabilities related to inventory not owned,
customer deposits or deferred income taxes arising in the ordinary course of business. The amount of Indebtedness of any Person at any date will be: 

(a) the outstanding balance at such date of all unconditional obligations as described above; 

(b) the maximum liability of such Person for any contingent obligations under clause (vii) above; and 

(c) in the case of clause (vi) (if the Indebtedness referred to therein is not assumed by such Person), the lesser of
the (1) Fair Market Value of all assets subject to a Lien securing the Indebtedness of others on the date that the Lien attaches and (2) amount of the Indebtedness secured. 

“Intangible Assets” of the Company means all unamortized debt discount and expense, unamortized deferred charges,
goodwill, patents, trademarks, service marks, trade names, copyrights and all other items which would be treated as intangibles on the consolidated balance sheet of the Company and its Restricted Subsidiaries prepared in accordance with GAAP.

 “Interest Expense” of any Person for any period means, without duplication, the aggregate amount of
(i) interest which, in conformity with GAAP, would be set opposite the caption “interest expense” or any like caption on an income statement for such Person (including, without limitation, imputed interest included on Capitalized
Lease Obligations, all commissions, 
  

 13 

 
discounts and other fees and charges owed with respect to letters of credit securing financial obligations and bankers’ acceptance financing, the net costs associated with Hedging
Obligations, amortization of other financing fees and expenses, the interest portion of any deferred payment obligation, amortization of discount or premium, if any, and all other non-cash interest expense other than interest and other charges
amortized to cost of sales) and includes, with respect to the Company and its Restricted Subsidiaries, without duplication (including duplication of the foregoing items), all interest amortized to cost of sales for such period, and (ii) the
amount of Disqualified Stock Dividends recognized by the Company on any Disqualified Stock whether or not paid during such period. 

“Interest Incurred” of any Person for any period means, without duplication, the aggregate amount of (i) interest
which, in conformity with GAAP, would be set opposite the caption “interest expense” or any like caption on an income statement for such Person (including, without limitation, imputed interest included on Capitalized Lease Obligations, all
commissions, discounts and other fees and charges owed with respect to letters of credit securing financial obligations and bankers’ acceptance financing, the net costs associated with Hedging Obligations, amortization of other financing fees
and expenses, the interest portion of any deferred payment obligation, amortization of discount or premium, if any, and all other noncash interest expense other than interest and other charges amortized to cost of sales) and includes, with respect
to the Company and its Restricted Subsidiaries, without duplication (including duplication of the foregoing items), all interest capitalized for such period, all interest attributable to discontinued operations for such period to the extent not set
forth on the income statement under the caption “interest expense” or any like caption, and all interest actually paid by the Company or a Restricted Subsidiary under any guarantee of Indebtedness (including, without limitation, a
guarantee of principal, interest or any combination thereof) of any other Person during such period and (ii) the amount of Disqualified Stock Dividends recognized by the Company on any Disqualified Stock whether or not declared during such
period. 
 “Interest Payment Date” means June 15 and December 15 of each year to Stated Maturity,
commencing June 15, 2010. 
 “Investments” of any Person means all (i) investments by such Person in
any other Person in the form of loans, advances or capital contributions, (ii) guarantees of Indebtedness or other obligations of any other Person by such Person, (iii) purchases (or other acquisitions for consideration) by such Person of
Indebtedness, Capital Stock or other securities of any other Person and (iv) other items that would be classified as investments on a balance sheet of such Person determined in accordance with GAAP. For all purposes hereof, the amount of any
such Investment shall be the Fair Market Value thereof (with the Fair Market Value of each Investment being measured at the time made and without giving effect to subsequent changes in value). The making of any payment in accordance with the terms
of a guarantee or other contingent obligation permitted hereunder shall not be considered an Investment. 
 “Issue
Date” means the initial date of issuance of the Notes hereunder. 
 “Legal Defeasance” shall have the
meaning set forth in Section 8.01(b) of the Indenture. 
  

 14 

 “Legal Holiday” means Saturday, Sunday or a day on which banking
institutions in New York, New York, Atlanta, Georgia or at a place of payment are authorized or obligated by law, regulation or executive order to remain closed. If a payment date is a Legal Holiday at a place of payment, payment shall be made at
that place on the next succeeding day that is not a Legal Holiday. 
 “Lien” means, with respect to any asset,
any mortgage, lien, pledge, charge, security interest or other similar encumbrance of any kind upon or in respect of such asset, whether or not filed, recorded or otherwise perfected under applicable law (including, without limitation, any
conditional sale or other title retention agreement). 
 “Mandatory Convertible Notes” means any Indebtedness
of a Person, the principal amount of which is payable at maturity solely in Capital Stock of such Person (provided that a requirement to pay accrued, but unpaid interest on such Indebtedness in cash at maturity or a requirement to pay cash fees,
expenses or premiums as a result of the acceleration of payment, early redemption or otherwise with respect to such Indebtedness shall not disqualify such Indebtedness as Mandatory Convertible Notes). 

“Material Subsidiary” means any Subsidiary of the Company which accounted for five percent or more of the Consolidated
Tangible Assets or Consolidated Cash Flow Available for Fixed Charges of the Company on a consolidated basis for the fiscal year ending immediately prior to any Default or Event of Default. 

“Moody’s” means Moody’s Investors Service, Inc. or any successor to its debt rating business. 

“Net Income Threshold” means Consolidated Net Income of greater than $0.01 for any two consecutive fiscal quarters ended
on or after the Issue Date. 
 “Non-Recourse Indebtedness” with respect to any Person means Indebtedness of
such Person for which (i) the sole legal recourse for collection of principal and interest on such Indebtedness is against the specific property identified in the instruments evidencing or securing such Indebtedness and such property was
acquired (directly or indirectly, including through the purchase of Capital Stock of the Person owning such property) with the proceeds of such Indebtedness or such Indebtedness was Incurred within 90 days after the acquisition (directly or
indirectly, including through the purchase of Capital Stock of the Person owning such property) of such property and (ii) no other assets of such Person may be realized upon in collection of principal or interest on such Indebtedness.
Indebtedness which is otherwise Non-Recourse Indebtedness will not lose its character as Non-Recourse Indebtedness because there is recourse to the borrower, any guarantor or any other Person for (a) environmental warranties and indemnities,
(b) indemnities for and liabilities arising from fraud, misrepresentation, misapplication or non-payment of rents, profits, insurance and condemnation proceeds and other sums actually received by the borrower from secured assets to be paid to
the lender, waste and mechanics’ liens or (c) in the case of the borrower thereof only, other obligations in respect of such Indebtedness that are payable solely as a result of a voluntary bankruptcy filing (or similar filing or action) by
such borrower. 
  

 15 

 “Obligations” means, with respect to any Indebtedness, all obligations
(whether in existence on the Issue Date or arising afterwards, absolute or contingent, direct or indirect) for or in respect of principal (when due, upon acceleration, upon redemption, upon mandatory repayment or repurchase pursuant to a mandatory
offer to purchase, or otherwise), premium, interest, penalties, fees, indemnification, reimbursement and other amounts payable and liabilities with respect to such Indebtedness, including all interest accrued or accruing after the commencement of
any bankruptcy, insolvency or reorganization or similar case or proceeding at the contract rate (including, without limitation, any contract rate applicable upon default) specified in the relevant documentation, whether or not the claim for such
interest is allowed as a claim in such case or proceeding. 
 “Officer” means the chairman, the chief executive
officer, the president, the chief financial officer, the chief operating officer, the chief accounting officer, the treasurer, or any assistant treasurer, the controller, the secretary, any assistant secretary or any vice president of a Person.

 “Officers’ Certificate” means a certificate signed by two Officers, one of whom must be the
Person’s chief executive officer, chief operating officer, chief financial officer or chief accounting officer. 

“Paying Agent” means any office or agency where Notes and the Subsidiary Guarantees may be presented for payment.

 “Permitted Investments” of any Person means any Investments of such Person that are not Restricted
Investments. 
 “Person” means any individual, corporation, partnership, limited liability company, joint
venture, incorporated or unincorporated association, joint stock company, trust, unincorporated organization or government or other agency or political subdivision thereof or other entity of any kind. 

“Preferred Stock” of any Person means all Capital Stock of such Person which has a preference in liquidation or with
respect to the payment of dividends. 
 “Record Date” for the interest, if any, payable on any applicable
Interest Payment Date means June 1 or December 1 (whether or not a Business Day) next preceding such Interest Payment Date. 

“Refinancing Indebtedness” means Indebtedness that refunds, refinances or extends any Existing Indebtedness or other
Indebtedness permitted to be incurred by the Company or its Restricted Subsidiaries pursuant to the terms hereof, but only to the extent that: 

(i) the Refinancing Indebtedness is subordinated in right of payment to the Notes or the Subsidiary Guarantees, as the case may be, to
the same extent as the Indebtedness being refunded, refinanced or extended, if at all; 
 (ii) the Refinancing Indebtedness is
scheduled to mature either (a) no earlier than the Indebtedness being refunded, refinanced or extended or (b) after the maturity date of the Notes; 
  

 16 

 (iii) the portion, if any, of the Refinancing Indebtedness that is scheduled to mature on or
prior to the maturity date of the Notes has a Weighted Average Life to Maturity at the time such Refinancing Indebtedness is Incurred that is equal to or greater than the Weighted Average Life to Maturity of the portion of the Indebtedness being
refunded, refinanced or extended that is scheduled to mature on or prior to the maturity date of the Notes; 
 (iv) such
Refinancing Indebtedness is in an aggregate amount that is equal to or less than the aggregate amount then outstanding (including accrued interest) under the Indebtedness being refunded, refinanced or extended plus an amount necessary to pay any
reasonable fees and expenses, including premiums and defeasance costs, related to such refinancing; and 
 (v) such Refinancing
Indebtedness is Incurred by the same Person that initially Incurred the Indebtedness being refunded, refinanced or extended, except that the Company may Incur Refinancing Indebtedness to refund, refinance or extend Indebtedness of any Restricted
Subsidiary. 
 “Registrar” means an office or agency where Notes may be presented for registration of transfer
or for exchange. 
 “Restricted Investment” means any Investment in joint ventures or Unrestricted Subsidiaries
having an aggregate fair market value (with the fair market value of each Investment being measured at the time made and without giving effect to subsequent changes in value), taken together with all other Investments made pursuant to this
definition that are at the time outstanding, net of any amounts paid to the Company or any Restricted Subsidiary as a return of, or on, such Investments, not to exceed five percent of Consolidated Tangible Assets; 

“Restricted Payment” means any of the following: 

(i) the declaration of any dividend or the making of any other payment or distribution of cash, securities or other property or assets in
respect of the Capital Stock of the Company or any Restricted Subsidiary (other than (a) dividends, payments or distributions payable solely in Capital Stock (other than Disqualified Stock) of the Company or a Restricted Subsidiary and
(b) in the case of a Restricted Subsidiary, dividends, payments or distributions payable to the Company or to another Restricted Subsidiary and pro rata dividends, payments or distributions payable to minority stockholders of such Restricted
Subsidiary); 
 (ii) the purchase, redemption, retirement or other acquisition for value of any Capital Stock of the Company or
any Restricted Subsidiary (other than Capital Stock held by the Company or a Restricted Subsidiary); 
 (iii) any Restricted
Investment; and 
 (iv) any principal payment, redemption, repurchase, defeasance or other acquisition or retirement of any
Subordinated Indebtedness (other than (a) Indebtedness permitted under Section 3.05(b)(vii) hereof or (b) the payment, redemption, repurchase, defeasance or other acquisition or retirement of such Indebtedness in anticipation of
satisfying a sinking fund obligation, principal installment or final maturity, in each case due within one year of the date of such payment, redemption, repurchase, defeasance or other acquisition or retirement); 

 

 17 

 provided, however, that Restricted Payments will not include any purchase,
redemption, retirement or other acquisition for value of Indebtedness or Capital Stock of the Company or a Restricted Subsidiary if the consideration therefor consists solely of Capital Stock (other than Disqualified Stock) of the Company or a
Restricted Subsidiary. 
 “Restricted Subsidiary” means each of the Subsidiaries of the Company which is not an
Unrestricted Subsidiary. 
 “Revolving Credit Facility” means the Amended and Restated Credit Agreement, dated
as of August 5, 2009, among the Company, the lenders and letter of credit issuers party thereto, and Citibank, N.A., as agent and swingline lender, as such facility may be amended, restated, supplemented or otherwise modified, refinanced or
replaced from time to time. 
 “S&P” means Standard and Poor’s Ratings Service, a division of McGraw
Hill, Inc., a New York corporation, or any successor to its debt rating business. 
 “SEC” means the Securities
and Exchange Commission. 
 “Secured Indebtedness” means any Indebtedness which is secured by (1) a Lien
on any property of the Company or any Restricted Subsidiary or (2) a Lien on shares of stock owned directly or indirectly by the Company or a Restricted Subsidiary in a corporation or on equity interests owned by the Company or a Restricted
Subsidiary in a partnership or other entity not organized as a corporation or in the Company’s rights or the rights of a Restricted Subsidiary in respect of Indebtedness of a corporation, partnership or other entity in which the Company or a
Restricted Subsidiary has an equity interest; provided that “Secured Indebtedness” shall not include Non-Recourse Indebtedness. The securing in the foregoing manner of any such Indebtedness which immediately prior thereto was
not Secured Indebtedness shall be deemed to be the creation of Secured Indebtedness at the time security is given. 

“Securities Act” means the Securities Act of 1933, as amended, and the rules and regulations of the SEC promulgated
thereunder. 
 “Security Register” is a register of the Notes and of their transfer and exchange kept by the
Registrar. 
 “Subordinated Indebtedness” means any Indebtedness which is subordinated in right of payment to
the Notes or the Subsidiary Guarantees, as the case may be. 
 “Subsidiary” of any Person means any
(i) corporation of which at least a majority of the aggregate voting power of all classes of the Common Equity is directly or indirectly beneficially owned by such Person and (ii) any entity other than a corporation of which such Person,
directly or indirectly, beneficially owns at least a majority of the Common Equity; provided that in each of case (i) and (ii), such Person is required to consolidate such entity in accordance with GAAP. 

“Subsidiary Guarantee” means the guarantee of the Notes by each Subsidiary Guarantor hereunder. 

 

 18 

 “Subsidiary Guarantors” means (i) each of the Company’s
Restricted Subsidiaries in existence on the Issue Date, other than The Ridings Development LLC and (ii) each of the Company’s Subsidiaries that becomes a guarantor of the Notes pursuant to the provisions hereof. 

“Successor” shall have the meaning set forth in Section 3.06(a)(i) hereof. 

“Treasury Rate” means, as of any redemption date, the yield to maturity as of such redemption date of United States
Treasury securities with a constant maturity (as compiled and published in the most recent Federal Reserve Statistical Release H.15 (519) that has become publicly available at least two Business Days prior to the redemption date (or, if such
Statistical Release is no longer published, any publicly available source of similar market data)) most nearly equal to the period from the redemption date to June 15, 2014; provided, however, that if the period from
the redemption date to June 15, 2014 is less than one year, the weekly average yield on actually traded United States Treasury securities adjusted to a constant maturity of one year will be used. 

“Unrestricted Subsidiary” means United Home Insurance Corporation, a Vermont corporation, Security Title Insurance
Company, Inc., a Vermont corporation, and, to the extent considered a Subsidiary of the Company, Beazer Homes Capital Trust I, and each of the Subsidiaries of the Company (including any newly formed or acquired Subsidiary) so designated by a
resolution adopted by the Board of Directors of the Company as provided below and provided that: 
 (i) neither the Company nor
any of its other Subsidiaries (other than Unrestricted Subsidiaries) (a) provides any direct or indirect credit support for any Indebtedness of such Subsidiary (including any undertaking, agreement or instrument evidencing such Indebtedness) or
(b) is directly or indirectly liable for any Indebtedness of such Subsidiary; 
 (ii) the creditors with respect to
Indebtedness for borrowed money of such Subsidiary have agreed in writing that they have no recourse, direct or indirect, to the Company or any other Subsidiary of the Company (other than Unrestricted Subsidiaries), including, without limitation,
recourse with respect to the payment of principal or interest on any Indebtedness of such Subsidiary; and 
 (iii) no default
with respect to any Indebtedness of such Subsidiary (including any right which the holders thereof may have to take enforcement action against such Subsidiary) would permit (upon notice, lapse of time or both) any holder of any other Indebtedness of
the Company and of its other Subsidiaries (other than other Unrestricted Subsidiaries), to declare a default on such other Indebtedness or cause the payment thereof to be accelerated or payable prior to its Stated Maturity. 

The Board of Directors of the Company, or a committee thereof, may designate an Unrestricted Subsidiary to be a Restricted Subsidiary;
provided that: 
 (i) any such redesignation will be deemed to be an Incurrence by the Company and its Restricted
Subsidiaries of the Indebtedness (if any) of such redesignated Subsidiary for purposes of Section 3.05 hereof as of the date of such redesignation; 
  

 19 

 (ii) immediately after giving effect to such redesignation and the Incurrence of any such
additional Indebtedness, the Company and its Restricted Subsidiaries could incur $1.00 of additional Indebtedness under the Consolidated Fixed Charge Coverage Ratio contained in Section 3.05 hereof; and 

(iii) the Liens on the property and assets of such Unrestricted Subsidiary could then be incurred in accordance with Section 3.04
hereof as of the date of such redesignation. 
 Subject to the foregoing, the Board of Directors of the Company also may
designate any Restricted Subsidiary to be an Unrestricted Subsidiary; provided that: 
 (i) all previous
Investments by the Company and its Restricted Subsidiaries in such Restricted Subsidiary (net of any returns previously paid on such Investments) will be deemed to be Restricted Payments at the time of such designation and will reduce the amount
available for Restricted Payments under Section 3.02 hereof; 
 (ii) immediately after giving effect to such designation
and reduction of amounts available for Restricted Payments under Section 3.02 hereof, either (a) the Company and its Restricted Subsidiaries could incur $1.00 of additional Indebtedness under the Consolidated Fixed Charge Coverage Ratio
contained in Section 3.05 hereof or (b) the Consolidated Fixed Charge Coverage Ratio for the Company and its Restricted Subsidiaries would be greater than such ratio immediately prior to such designation, in each case on a pro forma basis
taking into account such designation; and 
 (iii) no Default or Event of Default shall have occurred or be continuing.

 Any such designation or redesignation by the Board of Directors of the Company will be evidenced to the Trustee by the filing with the
Trustee of a certified copy of the resolution of the Board of Directors of the Company giving effect to such designation or redesignation and an Officers’ Certificate certifying that such designation or redesignation complied with the foregoing
conditions and setting forth the underlying calculations. 
 “U.S. Government Obligations” means securities
which are (i) direct obligations of the United States of America, for the payment of which its full faith and credit is pledged or (ii) obligations of a Person controlled or supervised by and acting as an agency or instrumentality of the
United States of America, the payment of which is unconditionally guaranteed as a full faith and credit obligation by the United States of America, which are not callable or redeemable at the option of the issuer thereof, and shall also include a
depository receipt issued by a bank or trust company as custodian with respect to any such U.S. Government Obligation or a specific payment of interest on or principal of any such U.S. Government Obligation held by such custodian for the account of
the holder of a depository receipt; provided that (except as required by law) such custodian is not authorized to make any deduction from the amount payable to the holder of such depository receipt from any amount received by the
custodian in respect of the U.S. Government Obligation or the specific payment of interest on or principal of the U.S. Government Obligation evidenced by such depository receipt. 

 

 20 

 “Weighted Average Life to Maturity” means, when applied to any Indebtedness
or portion thereof, at any date, the number of years obtained by dividing (i) the sum of the products obtained by multiplying (a) the amount of each then remaining installment, sinking fund, serial maturity or other required payment of
principal, including, without limitation, payment at final maturity, in respect thereof, by (b) the number of years (calculated to the nearest one-twelfth) that will elapse between such date and the making of such payment by (ii) the sum
of all such payments described in clause (a) above. 
 “Wholly Owned Subsidiary” of any Person means
(i) a Subsidiary of which 100% of the Common Equity (except for directors’ qualifying shares or certain minority interests owned by other Persons solely due to local law requirements that there be more than one stockholder, but which
interest is not in excess of what is required for such purpose) is owned directly by such Person or through one or more other Wholly Owned Subsidiaries of such Person, or (ii) any entity other than a corporation in which such Person, directly
or indirectly, owns all of the Common Equity of such entity. 
 ARTICLE THREE 

Covenants 

Section 3.01 Reports. 

As long as any of the Notes are outstanding, the Company shall deliver to the Trustee and mail to each Holder within 15 days after the
filing of the same with the SEC copies of the quarterly and annual reports and of the information, documents and other reports with respect to the Company and the Subsidiary Guarantors, if any, which the Company and the Subsidiary Guarantors may be
required to file with the SEC pursuant to Section 13 or 15(d) of the Exchange Act. Notwithstanding that neither the Company nor any of the Subsidiary Guarantors may be required to remain subject to the reporting requirements of Section 13
or 15(d) of the Exchange Act, the Company shall continue to file with the SEC and provide the Trustee and Holders with such annual and quarterly reports and such information, documents and other reports with respect to the Company and the Subsidiary
Guarantors as are required under Sections 13 and 15(d) of the Exchange Act. If filing of documents by the Company with the SEC as aforementioned in this paragraph is not permitted under the Exchange Act, the Company shall promptly upon written
notice supply copies of such documents to any prospective Holder. The Company and each Subsidiary Guarantor shall also comply with the other provisions of Section 314(a) of the TIA. For the avoidance of doubt, this Section 3.01 shall not
require the Company to file any such reports, information or documents with the SEC within any specified time period and the obligation to deliver such reports, information or documents to the Trustee and Holders shall only arise after (and only to
the extent) such reports, information or documents are filed with the SEC. 
 Section 3.02 Limitations on Restricted
Payments. 
 (a) The Company shall not, and shall not cause or permit any of its Restricted Subsidiaries to, make any
Restricted Payment, directly or indirectly, after the date hereof if at the time of such Restricted Payment: 
  

 21 

 (i) the amount of such proposed Restricted Payment (the amount of such
Restricted Payment, if other than in cash, shall be determined in good faith by a majority of the disinterested members of the Board of Directors of the Company), when added to the aggregate amount of all Restricted Payments (excluding Restricted
Payments permitted by paragraph (b) of this Section 3.02) declared or made after the Issue Date exceeds the sum of: 

(A) $200.0 million, plus 

(B) 50% of the Company’s Consolidated Net Income accrued during the period (taken as a single period) commencing on
the first day of the fiscal quarter in which the Covenant Trigger Date occurs and ending on the last day of the fiscal quarter immediately preceding the fiscal quarter in which the Restricted Payment is to occur (or, if such aggregate Consolidated
Net Income is a deficit, minus 100% of such aggregate deficit); provided, that for purposes of this calculation, if a Covenant Trigger Date occurs as the result of the Company achieving the Net Income Threshold, the Covenant Trigger
Date will be deemed to have occurred as of the first day of the second fiscal quarter included in calculating such Net Income Threshold, plus 

(C) the net cash proceeds derived from the issuance and sale of Capital Stock of the Company and its Restricted
Subsidiaries (or any capital contribution to the Company or a Restricted Subsidiary) that is not Disqualified Stock (other than a sale to, or a contribution by, a Subsidiary of the Company) after the Issue Date, plus  

(D) 100% of the principal amount of, or, if issued at a discount, the accreted value of, any Indebtedness of the Company
or a Restricted Subsidiary which is issued (other than to a Subsidiary of the Company) after the Issue Date that is converted into or exchanged for Capital Stock of the Company that is not Disqualified Stock, plus  

(E) 100% of the aggregate amounts received by the Company or any Restricted Subsidiary from the sale, disposition or
liquidation (including by way of dividends) of any Investment (other than to any Subsidiary of the Company and other than to the extent sold, disposed of or liquidated with recourse to the Company or any of its Subsidiaries or to any of their
respective properties or assets) but only to the extent (x) not included in clause (B) above and (y) that the making of such Investment constituted a permitted Restricted Investment (to the extent the Investment was made after the
Issue Date), plus  
 (F) 100% of the principal amount of, or if issued at a discount, the accreted value
of, any Indebtedness or other obligation that is the subject of a guarantee by the Company which is released (other than due to a payment on such guarantee) after the Issue Date, but only to the extent that such guarantee constituted a permitted
Restricted Payment, plus 
  

 22 

 (G) with respect to any Unrestricted Subsidiary that is redesignated as a
Restricted Subsidiary in accordance with the definition of “Unrestricted Subsidiary” (so long as the designation of such Subsidiary as an Unrestricted Subsidiary was treated as a Restricted Payment made after the Issue Date, and only to
the extent not included in clause (B) above), an amount equal to the lesser of (x) the proportionate interest of the Company or a Restricted Subsidiary in an amount equal to the excess of (I) the total assets of such Subsidiary,
valued on an aggregate basis at the lesser of Book Value and Fair Market Value thereof, over (II) the total liabilities of such Subsidiary, determined in accordance with GAAP, and (y) the amount of the Restricted Payment deemed to be made upon
such Subsidiary’s designation as an Unrestricted Subsidiary; or 
 (ii) the Company would be unable to
incur $1.00 of additional Indebtedness under the Consolidated Fixed Charge Coverage Ratio contained in Section 3.05 hereof; or 

(iii) a Default or Event of Default has occurred and is continuing or occurs as a consequence thereof. 

(b) Notwithstanding the foregoing, Section 3.02(a) shall not prohibit: 

(i) the payment of any dividend within 60 days after the date of declaration thereof if the payment thereof would have
complied with the limitations hereof on the date of declaration; 
 (ii) the purchase, repayment, redemption,
repurchase, defeasance or other acquisition or retirement of shares of the Company’s Capital Stock or the Company’s or a Restricted Subsidiary’s Indebtedness for, or out of the net proceeds of a substantially concurrent sale (other
than a sale to a Subsidiary of the Company) of, other shares of its Capital Stock (other than Disqualified Stock), provided that the proceeds of any such sale shall be excluded in any computation made under Section 3.02(a)(i)(C)
above; 
 (iii) the purchase, repayment, redemption, repurchase, defeasance or other acquisition or retirement
for value of Indebtedness, including premium, if any, with the proceeds of Refinancing Indebtedness; or 
 (iv)
other Restricted Payments made after the Issue Date in an amount not to exceed $50.0 million in the aggregate. 
 Section 3.03
Change of Control. 
 (a) Following the occurrence of any Change of Control, the Company shall so notify the Trustee in
writing by delivery of an Officers’ Certificate and shall offer to purchase (a “Change of Control Offer”) from all Holders, and shall purchase from Holders accepting such Change of Control Offer on the date fixed for the
closing of such Change of Control Offer (the “Change of Control Payment Date”), the outstanding principal amount of Notes at an offer price (the “Change of Control Price”) in cash in an amount equal to 101% of

  

 23 

 
the aggregate principal amount thereof plus accrued and unpaid interest, if any, to the Change of Control Payment Date in accordance with the procedures set forth in this Section 3.03.

 (b) Within 30 days after the date on which a Change of Control occurs, the Company (with notice to the Trustee) or the
Trustee, at the written request (coupled with an Officer’s Certificate which sets forth the information contained in subclauses (i)-(ix) of this clause (b)) and expense of the Company, shall send or cause to be sent by first-class mail,
postage pre-paid, to all Persons who were Holders on the date of the Change of Control at their respective addresses appearing in the Security Register, a notice of such occurrence and of such Holder’s rights arising as a result thereof. Such
notice, which will govern the terms of the Change of Control Offer, will state: 
 (i) that the Change of
Control Offer is being made pursuant to Section 3.03(a) hereof and the length of time the Change of Control Offer will remain open; 

(ii) that the Holder has the right to require the Company to repurchase such Holder’s Notes at the Change of Control
Price; 
 (iii) that any Note not tendered will continue to accrue interest; 

(iv) that any Note accepted for payment pursuant to the Change of Control Offer will cease to accrue interest on the
Change of Control Payment Date; 
 (v) that the Change of Control Payment Date shall be no earlier than 45 days
nor later than 60 days from the date such notice is mailed; 
 (vi) that Holders electing to have a Note
purchased pursuant to any Change of Control Offer will be required to surrender the Note to the Company, a Depositary, if appointed by the Company, or a Paying Agent at the address specified in the notice prior to termination of the Change of
Control Offer; 
 (vii) that Holders will be entitled to withdraw their election if the Company, Depositary or
Paying Agent, as the case may be, receives, not later than the expiration of the Change of Control Offer, or such longer period as may be required by law, a telegram, telex, facsimile transmission or letter setting forth the name of the Holder, the
principal amount of the Note the Holder delivered for purchase and a statement that such Holder is withdrawing its election to have the Note purchased pursuant to this Section 3.03; 

(viii) that Holders which elect to have their Notes purchased only in part will be issued new Notes in a principal amount
equal to the unpurchased portion of the Notes surrendered; and 
  

 24 

 (ix) information concerning the date and details of the Change of Control
and the business of the Company which the Company in good faith believes will enable such Holders to make an informed decision (which at a minimum will include (A) the most recently filed Annual Report on Form 10-K (including audited
consolidated financial statements) of the Company, the most recent subsequently filed Quarterly Report on Form 10-Q and any Current Report on Form 8-K of the Company filed subsequent to such Quarterly Report, other than Current Reports otherwise
describing the offering materials relating to the Change of Control Offer (or corresponding successor reports); provided that the Company may at its option incorporate by reference any such filed reports in the notice, (B) a
description of material developments in the Company’s business subsequent to the date of the latest of such reports, and (C) if material, appropriate pro forma financial information). 

(c) In the event of a Change of Control Offer, the Company shall only be required to accept Notes in minimum denominations of $2,000 and
integral multiples of $1,000 in excess thereof. 
 (d) Not later than one Business Day after the Change of Control Payment Date
in connection with which the Change of Control Offer is being made, the Company shall (i) accept for payment Notes or portions thereof tendered pursuant to the Change of Control Offer, (ii) deposit with the Paying Agent money sufficient,
in immediately available funds, to pay the purchase price of all Notes or portions thereof so accepted and (iii) deliver to the Paying Agent an Officers’ Certificate identifying the Notes or portions thereof accepted for payment by the
Company. The Paying Agent shall promptly mail or deliver to Holders of Notes so accepted payment in an amount equal to the Change of Control Price of the Notes purchased from each such Holder, and the Company shall execute and, upon receipt of an
Officers’ Certificate of the Company, the Trustee shall promptly authenticate and mail or deliver to such Holder a new Note equal in principal amount to any unpurchased portion of the Note surrendered. Any Notes not so accepted shall be
promptly mailed or delivered by the Paying Agent at the Company’s expense to the Holder thereof. The Company shall publicly announce the results of the Change of Control Offer promptly after the Change of Control Payment Date. 

(e) Any Change of Control Offer shall be conducted by the Company in compliance with applicable law, including, without limitation,
Section 14(e) of the Exchange Act and Rule 14e-1 thereunder. 
 Section 3.04 Limitations on Secured Indebtedness.
Notwithstanding any Indebtedness that may be incurred under Section 3.05, the Company shall not, and shall not permit any of its Restricted Subsidiaries to, create, incur, assume or guarantee any Secured Indebtedness unless the Notes are
equally and ratably secured with (or on a senior basis to, if the Secured Indebtedness is subordinated Indebtedness) the Secured Indebtedness. Notwithstanding the foregoing, this Section 3.04(a) shall not prohibit the creation, incurrence,
assumption or guarantee of Secured Indebtedness that is secured by: 
  

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 (i) Liens on model homes, homes held for sale, homes that are under
contract for sale, or any option, contract or other agreement to sell an asset; 
 (ii) Liens on property
acquired by the Company or a Restricted Subsidiary and Liens on property of a Person existing at the time such Person is merged with or into or consolidated with the Company or any Restricted Subsidiary or becomes a Restricted Subsidiary;
provided that in each case such Liens (a) were in existence prior to the contemplation of such acquisition, merger or consolidation and (b) do not extend to any asset other than those of the Person merged with or into or
consolidated with the Company or the Restricted Subsidiary or the property acquired by the Company or the Restricted Subsidiary; 

(iii) Liens arising out of conditional sale, title retention, consignment or similar arrangements for the sale of goods
entered into by the Company or any of its Subsidiaries in the ordinary course of business; 
 (iv) purchase
money mortgages (including, without limitation, Capitalized Lease Obligations and purchase money security interests); or 

(v) Liens on property or assets of any Restricted Subsidiary securing Indebtedness of such Restricted Subsidiary owing to
the Company or one or more Restricted Subsidiaries. 
 Secured Indebtedness permitted pursuant to clauses (i) through (v) of this
Section 3.04(a) includes any amendment, restatement, supplement, renewal, replacement, extension or refunding in whole or in part of Secured Indebtedness permitted at the time of the original incurrence thereof. 

(b) Any Lien created for the benefit of the Holders of the Notes pursuant to paragraph (a) of this Section 3.04 shall provide
by its terms that such Lien shall be automatically and unconditionally released and discharged upon the release and discharge of the Lien securing such other obligations. 

(c) Notwithstanding anything to the contrary in this Section 3.04, the Company and its Restricted Subsidiaries may create, incur,
assume or guarantee Secured Indebtedness, without equally or ratably securing the Notes, if immediately thereafter the aggregate principal amount of all Secured Indebtedness outstanding (excluding (a) Secured Indebtedness permitted under
clauses (i) through (v) of paragraph (a) of this Section 3.04 and (b) any Secured Indebtedness in relation to which the Notes have been equally and ratably secured) as of the date of determination would not exceed the
greater of (i) $700.0 million and (ii) 40% of Consolidated Tangible Assets. 
 Section 3.05 Limitations on
Additional Indebtedness. 
 (a) The Company shall not, and shall not cause or permit any of its Restricted Subsidiaries,
directly or indirectly, to, Incur any Indebtedness including Acquired 
  

 26 

 
Indebtedness; provided that the Company and the Subsidiary Guarantors may Incur Indebtedness, including Acquired Indebtedness, if, after giving effect thereto and the application of
the proceeds therefrom, either (i) the Company’s Consolidated Fixed Charge Coverage Ratio on the date thereof would be at least 2.0 to 1.0 or (ii) the ratio of Adjusted Indebtedness of the Company and the Restricted Subsidiaries to
Adjusted Consolidated Tangible Net Worth is less than 7.5 to 1. 
 (b) Notwithstanding the foregoing, Section 3.05(a)
shall not prevent: 
 (i) the Company or any Restricted Subsidiary from Incurring (A) Refinancing
Indebtedness or (B) Non-Recourse Indebtedness; 
 (ii) the Company from Incurring Indebtedness evidenced by
the Notes issued on the Issue Date; 
 (iii) the Company or any Subsidiary Guarantor from Incurring Indebtedness
under Credit Facilities not to exceed the greater of $250.0 million and 15.0% of Consolidated Tangible Assets of the Company; 

(iv) any Subsidiary Guarantee of Indebtedness of the Company under the Notes; 

(v) the Company and its Restricted Subsidiaries from Incurring Indebtedness under any deposits made to secure performance
of tenders, bids, leases, statutory obligations, surety and appeal bonds, progress statements, government contracts and other obligations of like nature (exclusive of the obligation for the payment of borrowed money); 

(vi) any Subsidiary Guarantor from guaranteeing Indebtedness of the Company or any other Subsidiary Guarantor, or the
Company from guaranteeing Indebtedness of any Subsidiary Guarantor, in each case permitted to be Incurred hereunder (other than Non-Recourse Indebtedness); 

(vii) (a) any Restricted Subsidiary from Incurring Indebtedness owing to the Company or any Subsidiary Guarantor that is
both a Wholly Owned Subsidiary and a Restricted Subsidiary; provided that (I) such Indebtedness is subordinated to any Subsidiary Guarantee of such Restricted Subsidiary, if any, and (II) such Indebtedness shall only be permitted
pursuant to this clause (vii)(a) for so long as the Person to whom such Indebtedness is owing is the Company or a Subsidiary Guarantor that is both a Wholly Owned Subsidiary and a Restricted Subsidiary and (b) the Company from Incurring
Indebtedness owing to any Subsidiary Guarantor that is both a Wholly Owned Subsidiary and a Restricted Subsidiary; provided that (I) such Indebtedness is subordinated to the Company’s obligations hereunder and under the Notes
and (II) such Indebtedness shall only be permitted pursuant to this clause (vii)(b) for so long as the Person to whom such Indebtedness is owing is a Subsidiary Guarantor that is both a Wholly Owned Subsidiary and a Restricted Subsidiary;

  

 27 

 (viii) the Company and any Restricted Subsidiary from Incurring
Indebtedness under Capitalized Lease Obligations or purchase money obligations, in each case Incurred for the purpose of acquiring or financing all or any part of the purchase price or cost of construction or improvement of property or equipment
used in the business of the Company or such Restricted Subsidiary, as the case may be, in an aggregate amount not to exceed $50.0 million; 

(ix) the Company or any Restricted Subsidiary from Incurring obligations for, pledge of assets in respect of, and
guaranties of, bond financings of political subdivisions or enterprises thereof in the ordinary course of business; 

(x) the Company or any Restricted Subsidiary from incurring Indebtedness owed to a seller of entitled land, lots under
development or finished lots under the terms of which the Company or such Restricted Subsidiary, as obligor, is required to make a payment upon the future sale of such land or lots; and 

(xi) the Company or any Restricted Subsidiary from Incurring Indebtedness in an aggregate principal amount at any time
outstanding not to exceed $100.0 million. 
 (c) The Company shall not, and shall not cause or permit any Subsidiary Guarantor
that is a Restricted Subsidiary to, directly or indirectly, in any event Incur any Indebtedness that purports to be by its terms (or by the terms of any agreement governing such Indebtedness) subordinated to any other Indebtedness of the Company or
of such Subsidiary Guarantor, as the case may be, unless such Indebtedness is also by its terms (or by the terms of any agreement governing such Indebtedness) made expressly subordinated to the Notes or the Subsidiary Guarantee of such Subsidiary
Guarantor, as the case may be, to the same extent and in the same manner as such Indebtedness is subordinated to such other Indebtedness of the Company or such Subsidiary Guarantor, as the case may be. 

(d) For purposes of determining compliance with this Section 3.05, in the event an item of Indebtedness meets the criteria of more
than one of the types of Indebtedness described in the above clauses of this Section 3.05, the Company, in its sole discretion, shall classify such item of Indebtedness in any manner that complies with this Section 3.05 and may from time
to time reclassify such item of Indebtedness in any manner in which such item could be Incurred at the time of such reclassification. 

Section 3.06 Limitations on Mergers and Consolidations. 

(a) Neither the Company nor any Subsidiary Guarantor shall consolidate or merge with or into, or sell, lease, convey or otherwise dispose
of all or substantially all of its assets (including, without limitation, by way of liquidation or dissolution), or assign any of its obligations under the Notes, the Guarantees or this Supplemental Indenture (as an entirety or substantially in one
transaction or series of related transactions), to any Person 
  

 28 

 
(in each case other than with the Company or another Wholly Owned Restricted Subsidiary) unless: 

(i) the Person formed by or surviving such consolidation or merger (if other than the Company or such Subsidiary
Guarantor, as the case may be), or to which such sale, lease, conveyance or other disposition or assignment shall be made (collectively, the “Successor”), is a solvent corporation or other legal entity organized and existing under
the laws of the United States or any state thereof or the District of Columbia, and the Successor assumes by supplemental indenture in a form reasonably satisfactory to the Trustee all of the obligations of the Company or such Subsidiary Guarantor,
as the case may be, under the Notes or such Subsidiary Guarantor’s Subsidiary Guarantee, as the case may be, and the Indenture; and 

(ii) immediately after giving effect to such transaction, no Default or Event of Default has occurred and is continuing.

 The foregoing provisions shall not apply to a transaction involving the consolidation or merger of a Subsidiary Guarantor with
or into another Person, or the sale, lease, conveyance or other disposition of all or substantially all of the assets of such Subsidiary Guarantor, that results in such Subsidiary Guarantor being released from its Subsidiary Guarantee as provided in
Section 4.04 hereof. In addition, clauses (i) and (ii) of this Section 3.06 will not apply to any transaction the purpose of which is to change the state of organization of the Company or a Restricted Subsidiary. 

ARTICLE FOUR 

Subsidiary Guarantees 

Section 4.01 Subsidiary Guarantees. 

(a) Subject to the provisions of this Article Four, each Subsidiary Guarantor hereby jointly and severally unconditionally guarantees to
each Holder and to the Trustee and its successors and assigns, irrespective of the validity and enforceability of the Indenture, the Notes or the obligations of the Company or any other Subsidiary Guarantor to the Holders or the Trustee hereunder or
thereunder, that: (i) the principal of, premium, if any, and interest on the Notes will be duly and punctually paid in full when due, whether at maturity, by acceleration or otherwise, and interest on the overdue principal and (to the extent
permitted by law) interest, if any, on the Notes and all other obligations of the Company or the Subsidiary Guarantors to the Holders or the Trustee hereunder or thereunder (including fees, expenses or other) and all other obligations with respect
to the Notes and the Indenture will be promptly paid in full or performed, all in accordance with the terms hereof and thereof; and (ii) in case of any extension of time of payment or renewal of any Notes, the same will be promptly paid in full
when due or performed in accordance with the terms of the extension or renewal, whether at maturity, by acceleration or otherwise. Failing payment when due of any amount so guaranteed, or failing performance of any other obligation of the Company to
the Holders, for whatever 
  

 29 

 
reason, each Subsidiary Guarantor will be obligated, jointly and severally with each other Subsidiary Guarantor, to pay, or to perform or cause the performance of, the same immediately. An Event
of Default under the Indenture or the Notes shall constitute an event of default under this Article Four, and shall entitle the Holders of Notes to accelerate the obligations of the Subsidiary Guarantors hereunder in the same manner and to the same
extent as the obligations of the Company. 
 (b) Each of the Subsidiary Guarantors hereby agrees that its obligations hereunder
shall be continuing, absolute and unconditional, irrespective of, and shall be unaffected by, the validity, regularity or enforceability of the Notes or the Indenture, the absence of any action to enforce the same, any waiver or consent by any
Holder or the Trustee with respect to any provisions hereof or thereof, any release of any other Subsidiary Guarantor, the recovery of any judgment against the Company, any action to enforce the same, whether or not a Subsidiary Guarantee is affixed
to any particular Note, or any other circumstance which might otherwise constitute a legal or equitable discharge or defense of a Subsidiary Guarantor. Each of the Subsidiary Guarantors hereby waives the benefit of diligence, presentment, demand of
payment, filing of claims with a court in the event of insolvency or bankruptcy of the Company, any right to require a proceeding first against the Company, protest, notice and all demands whatsoever and covenants that its Subsidiary Guarantee will
not be discharged except by complete performance of the obligations contained in the Notes, the Indenture and this Article Four. If any Holder or the Trustee is required by any court or otherwise to return to the Company or to any Subsidiary
Guarantor, or any custodian, trustee, liquidator or other similar official acting in relation to the Company or such Subsidiary Guarantor, any amount paid by the Company or such Subsidiary Guarantor to the Trustee or such Holder, this Article Four,
to the extent theretofore discharged, shall be reinstated in full force and effect. Each Subsidiary Guarantor further agrees that, as between it, on the one hand, and the Holders of Notes and the Trustee, on the other hand, (i) subject to this
Article Four, the maturity of the obligations guaranteed hereby may be accelerated as provided in Section 6.02 of the Indenture for the purposes of this Article Four, notwithstanding any stay, injunction or other prohibition preventing such
acceleration in respect of the obligations guaranteed hereby, and (ii) in the event of any acceleration of such obligations as provided in Section 6.02 of the Indenture, such obligations (whether or not due and payable) shall forthwith
become due and payable by the Subsidiary Guarantors for the purpose of this Article Four. 
 (c) This Article Four shall remain
in full force and effect and continue to be effective should any petition be filed by or against the Company for liquidation or reorganization, should the Company become insolvent or make an assignment for the benefit of creditors or should a
receiver or trustee be appointed for all or any significant part of the Company’s assets, and shall, to the fullest extent permitted by law, continue to be effective or be reinstated, as the case may be, if at any time payment and performance
of the Notes are, pursuant to applicable law, rescinded or reduced in amount, or must otherwise be restored or returned by any obligee on the Notes, whether as a “voidable preference,” “fraudulent transfer” or otherwise, all as
though such payment or performance had not been made. In the event that any payment, or any part thereof, is rescinded, reduced, restored or returned, the Subsidiary Guarantees shall, to the fullest extent permitted by law, be reinstated and deemed
reduced only by such amount paid and not so rescinded, reduced, restored or returned. 
  

 30 

 (d) Each Subsidiary Guarantor, and by its acceptance hereof each Holder, hereby confirms
that it is the intention of all such parties that the guarantee by each Subsidiary Guarantor pursuant to its Subsidiary Guarantee not constitute a fraudulent transfer or conveyance for purposes of the Bankruptcy Law, the Uniform Fraudulent
Conveyance Act, the Uniform Fraudulent Transfer Act or any similar federal or state law. To effectuate the foregoing intention, the Holders and each Subsidiary Guarantor hereby irrevocably agree that the obligations of each Subsidiary Guarantor
under the Subsidiary Guarantees shall be limited to the maximum amount which, after giving effect to all other contingent and fixed liabilities of such Subsidiary Guarantor and after giving effect to any collections from or payments made by or on
behalf of any other Subsidiary Guarantor in respect of the obligations of such other Subsidiary Guarantor under its Subsidiary Guarantee or pursuant to its contribution obligations under the Indenture, will result in the obligations of such
Subsidiary Guarantor and its Subsidiary Guarantee not constituting a fraudulent conveyance or fraudulent transfer under federal or state law. 

Section 4.02 Execution and Delivery of Subsidiary Guarantees. 

(a) To further evidence the Subsidiary Guarantee set forth in Section 4.01, each of the Subsidiary Guarantors hereby agrees that a
notation of such Subsidiary Guarantee, substantially in the form included in Exhibit A hereto, shall be endorsed on each Note authenticated and delivered by the Trustee after such Subsidiary Guarantee is executed by either manual or facsimile
signature of an Officer of each Subsidiary Guarantor. The validity and enforceability of any Subsidiary Guarantee shall not be affected by the fact that it is not affixed to any particular Note. 

(b) Each of the Subsidiary Guarantors hereby agrees that its Subsidiary Guarantee set forth in Section 4.01 shall remain in full
force and effect notwithstanding any failure to endorse on each Note a notation of such Subsidiary Guarantee. 
 (c) If an
Officer of a Subsidiary Guarantor whose signature is on the Indenture or a Note no longer holds that office at the time the Trustee authenticates such Note or at any time thereafter, such Subsidiary Guarantor’s Subsidiary Guarantee of such Note
shall be valid nevertheless. 
 (d) The delivery of any Note by the Trustee, after the authentication thereof hereunder, shall
constitute due delivery of any Subsidiary Guarantee set forth in the Indenture on behalf of the Subsidiary Guarantor. 
 Section
4.03 Additional Subsidiary Guarantors. 
 Any Person may become a Subsidiary Guarantor by executing and delivering to the
Trustee (a) a supplemental indenture in form and substance satisfactory to the Trustee which subjects such Person to the provisions of the Indenture as a Subsidiary Guarantor, and (b) an Opinion of Counsel to the effect that such
supplemental indenture has been duly authorized and executed by such Person and constitutes the legal, valid, binding and enforceable obligation of such Person (subject to such customary exceptions concerning fraudulent conveyance laws,
creditors’ rights and equitable principles as may be acceptable to the Trustee in its discretion). 
  

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 Section 4.04 Release of a Subsidiary Guarantor. 

(a) If all or substantially all of the assets of any Subsidiary Guarantor or all (or a portion sufficient to cause such Subsidiary
Guarantor to no longer be a Subsidiary of the Company) of the Capital Stock of any Subsidiary Guarantor is sold (including by consolidation, merger, issuance or otherwise) or disposed of (including by liquidation, dissolution or otherwise) by the
Company or any of its Subsidiaries, or, unless the Company elects otherwise, if any Subsidiary Guarantor is designated an Unrestricted Subsidiary in accordance with the terms hereof, then such Subsidiary Guarantor (in the event of a sale or other
disposition of all of the Capital Stock of such Subsidiary Guarantor or a designation as an Unrestricted Subsidiary) or the Person acquiring such assets (in the event of a sale or other disposition of all or substantially all of the assets of such
Subsidiary Guarantor) shall be deemed automatically and unconditionally released and discharged from any of its obligations hereunder without any further action on the part of the Trustee or any Holder of the Notes, subject in each case to
compliance with Section 3.06 hereof. 
 (b) The Trustee shall deliver an appropriate instrument or instruments evidencing
the release of a Subsidiary Guarantor from its obligations under its Subsidiary Guarantee endorsed on the Notes and under this Article Four upon receipt of a request of the Company accompanied by an Officers’ Certificate certifying as to the
compliance with this Section 4.04. Any Subsidiary Guarantor not so released or the entity surviving such Subsidiary Guarantor, as applicable, will remain or be liable under its Subsidiary Guarantee as provided in this Article Four. 

(c) The Trustee shall execute any other documents reasonably requested by the Company or a Subsidiary Guarantor in order to evidence the
release of such Subsidiary Guarantor from its obligations under its Subsidiary Guarantee endorsed on the Notes and under this Article Four. 

(d) Except as set forth in Article Three hereof and this Section 4.04, nothing contained in this Supplemental Indenture or in any
of the Notes shall prevent any consolidation or merger of a Subsidiary Guarantor with or into the Company or another Subsidiary Guarantor or shall prevent any sale or conveyance of the property of a Subsidiary Guarantor as an entirety or
substantially as an entirety to the Company or another Subsidiary Guarantor. 
 Section 4.05 Waiver of Subrogation; Right of
Contribution. 
 (a) Except as set forth in Section 4.05(b) below, each Subsidiary Guarantor hereby irrevocably waives
any claim or other rights which it may now or hereafter acquire against the Company or any of its Subsidiaries that arise from the existence, payment, performance or enforcement of such Subsidiary Guarantor’s obligations under this Article Four
and this Supplemental Indenture, including, without limitation, any right of subrogation, reimbursement, exoneration, indemnification, and any right to participate in any claim or remedy 

 

 32 

 
of any Holder of Notes against the Company or any of its Subsidiaries, whether or not such claim, remedy or right arises in equity, or under contract, statute or common law, including, without
limitation, the right to take or receive from the Company or any of its Subsidiaries, directly or indirectly, in cash or other property or by set-off or in any other manner, payment or security on account of such claim or other rights. If any amount
shall be paid to any Subsidiary Guarantor in violation of the preceding sentence and the Notes shall not have been paid in full, such amount shall have been deemed to have been paid to such Subsidiary Guarantor for the benefit of, and held in trust
for the benefit of, the Holders of the Notes, and shall forthwith be paid to the Trustee for the benefit of such Holders to be credited and applied upon the Notes, whether matured or unmatured, in accordance with the terms of this Supplemental
Indenture. Each Subsidiary Guarantor acknowledges that it will receive direct and indirect benefits from the financing arrangements contemplated by this Supplemental Indenture and that the waiver set forth in this Section 4.05 is knowingly made
in contemplation of such benefits. 
 (b) Notwithstanding Section 4.05(a), each Subsidiary Guarantor that makes a payment
or distribution under a Subsidiary Guarantee shall be entitled to a contribution from each other Subsidiary Guarantor in an amount pro rata, based on the net assets of each Subsidiary Guarantor, determined in accordance with GAAP. 

ARTICLE FIVE 

Miscellaneous 

Section 5.01 Defeasance Upon Deposit of Moneys or U.S. Government Obligations. 

Section 8.01 of the Base Indenture is hereby replaced in its entirety as follows: 

“Section 8.01 Defeasance Upon Deposit of Moneys or U.S. Government Obligations. 

(a) The Company may, at its option and at any time, elect to have either paragraph (b) or paragraph (c) below be applied to
the outstanding Notes upon compliance with the applicable conditions set forth in paragraph (d). 
 (b) Upon the Company’s
exercise under Section 8.01(a) of the option applicable to this clause (b), the Company and the Subsidiary Guarantors shall be deemed to have been released and discharged from their respective obligations with respect to the outstanding Notes
and Subsidiary Guarantees on the date the applicable conditions set forth below are satisfied (hereinafter, “Legal Defeasance”). For this purpose, Legal Defeasance means that the Company shall be deemed to have paid and discharged
the entire Indebtedness represented by the outstanding Notes, which shall thereafter be deemed to be “outstanding” only for the purposes of the Sections and matters under this Indenture referred to in (i) and (ii) below, and to
have satisfied all its other obligations under the Notes and this Indenture, except for the following provisions which shall survive until otherwise terminated or discharged hereunder: (i) the rights of Holders of outstanding Notes to receive
solely from the trust fund described in paragraph (d) below and as more fully set forth in such paragraph, payments in respect of the 

 

 33 

 
principal of and interest on such Notes when such payments are due and (ii) obligations listed in Section 8.02 of this Indenture, subject to compliance with this Section 8.01. The
Company may exercise its option under this paragraph (b) notwithstanding the prior exercise of its option under paragraph (c) below with respect to such Notes. 

(c) Upon the Company’s exercise under Section 8.01(a) of the option applicable to this clause (c), the Company and the
Subsidiary Guarantors shall be released and discharged from the obligations under any covenant contained in Article Three of the Thirteenth Supplemental Indenture, dated as of May 20, 2010, on and after the date the conditions set forth below
are satisfied (hereinafter, “Covenant Defeasance”), and the Notes shall thereafter be deemed to be not “outstanding” for the purpose of any direction, waiver, consent or declaration or act of Holders (and the consequences
of any thereof) in connection with such covenants, but shall continue to be deemed “outstanding” for all other purposes hereunder. For this purpose, such Covenant Defeasance means that, with respect to the outstanding Notes, the Company
may omit to comply with and shall have no liability in respect of any term, condition or limitation set forth in any such covenant, whether directly or indirectly, by reason of any reference elsewhere herein to any such covenant or by reason of any
reference in any such covenant to any other provision herein or in any other document and such omission to comply shall not constitute a Default or an Event of Default under Section 6.01(a)(iii) of the Indenture, but, except as specified above,
the remainder of this Indenture and such Notes shall be unaffected thereby. In addition, upon the Company’s exercise under Section 8.01(a) of the option applicable to this Section 8.01(c), subject to the satisfaction of the conditions
set forth in Section 8.01(d), Sections 6.01(a)(iii), (iv), (v), (vi) and (x) of this Indenture shall not constitute Events of Default. 

(d) The following shall be the conditions to application of either paragraph (b) or paragraph (c) above to the outstanding
Notes: 
 (i) The Company shall provide written notice to the Trustee and the Holders of its election under
Section 8.01(a). 
 (ii) The Company shall irrevocably have deposited or caused to be deposited with the
Trustee (or another trustee satisfying the requirements of Section 7.10 of this Indenture who shall agree to comply with the provisions of this Article Eight applicable to it) as trust funds in trust for the purpose of making the following
payments, specifically pledged as security for, and dedicated solely to, the benefit of the Holders of Notes, (1) cash in U.S. dollars, or (2) U.S. Government Obligations which through the scheduled payment of principal and interest in
respect thereof in accordance with their terms will provide, not later than the due date of any payment of principal of (and premium, if any) and interest, if any, on such Notes, money in an amount, or (3) a combination thereof, in any case, in
an amount, sufficient, without consideration of any reinvestment of such principal and interest, in the opinion of a nationally recognized firm of independent public accountants expressed in a written certification thereof delivered to the Trustee,
to pay and discharge, and which shall be applied by the Trustee (or other qualifying trustee) to pay and discharge, (i) the principal of (and premium, if any) and interest, if any, on such Notes on the maturity date of such principal or
installment of principal or interest and (ii) any 
  

 34 

 
mandatory sinking fund payments or analogous payments applicable to such Notes on the day on which such payments are due and payable in accordance with the terms of this Indenture and of such
Notes. 
 (iii) Such Legal Defeasance or Covenant Defeasance shall not result in a breach or violation of, or
constitute a default under, this Indenture or any other material agreement or instrument to which the Company is a party or by which it is bound. 

(iv) No Event of Default or event which with notice or lapse of time or both would become an Event of Default shall have
occurred and be continuing on the date of such deposit or, insofar as Section 6.01(a)(vi) and Section 6.01(a)(vii) of this Indenture are concerned, at any time during the period ending on the 91st day after the date of such deposit (it
being understood that this condition shall not be deemed satisfied until the expiration of such period). 
 (v)
In the case of an election under Section 8.01(b), the Company shall have delivered to the Trustee an Opinion of Counsel stating that (i) the Company has received from, or there has been published by, the Internal Revenue Service a ruling,
or (ii) since the date of execution of this Indenture, there has been a change in the applicable federal income tax law, in either case to the effect that, and based thereon such opinion shall confirm that, the Holders of Notes will not
recognize income, gain or loss for federal income tax purposes as a result of such defeasance and will be subject to federal income tax on the same amounts, in the same manner and at the same times as would have been the case if such defeasance had
not occurred. 
 (vi) In the case of an election under Section 8.01(c), the Company shall have delivered to
the Trustee an Opinion of Counsel to the effect that the Holders of such Notes will not recognize income, gain or loss for federal income tax purposes as a result of such covenant defeasance and will be subject to federal income tax on the same
amounts, in the same manner and at the same times as would have been the case if such covenant defeasance had not occurred. 

(vii) The Company shall have delivered to the Trustee an Officers’ Certificate and an Opinion of Counsel, each
stating that all conditions precedent to the Legal Defeasance under Section 8.01(b) or the Covenant Defeasance under Section 8.01(c) (as the case may be) have been complied with and an Opinion of Counsel to the effect that either
(i) as a result of a deposit pursuant to Section 8.01(d)(ii) and the related exercise of the Company’s option under Section 8.01(b) or Section 8.01(c) (as the case may be), registration is not required under the Investment
Company Act of 1940, as amended, by the Company, with respect to the trust funds representing such deposit or by the Trustee for such trust funds or (ii) all necessary registrations under said Act have been effected. 

 

 35 

 (viii) Notwithstanding any other provisions of this Section, such Legal
Defeasance or Covenant Defeasance shall be effected in compliance with any additional or substitute terms, conditions or limitations with may be imposed on the Company in connection therewith pursuant to Section 2.01 of this Indenture.

 In the event all or any portion of the Notes are to be redeemed through such irrevocable trust, the Company must make
arrangements satisfactory to the Trustee, at the time of such deposit, for the giving of the notice of such redemption or redemptions by the Trustee in the name and at the expense of the Company.” 

Section 5.02 Events of Default. 

Sections 6.01 and 6.02 of the Base Indenture are hereby replaced in their entirety as follows: 

“Section 6.01 Events of Default. 

(a) An “Event of Default” wherever used herein, means any one of the following events: 

(i) the failure by the Company to pay interest on any Note when the same becomes due and payable and the continuance of
any such failure for a period of 30 days; 
 (ii) the failure by the Company to pay the principal or premium of
any Note when the same becomes due and payable at maturity, upon acceleration or otherwise (including the failure to make payment pursuant to a Change of Control Offer); 

(iii) the failure by the Company or any of its Subsidiaries to comply with any of its agreements or covenants in, or
provisions of, the Notes, the Subsidiary Guarantees or this Indenture and such failure continues for the period and after the notice specified below; 

(iv) the acceleration of any Indebtedness that has an outstanding principal amount of $25.0 million or more in the
aggregate (other than Non-Recourse Indebtedness) of the Company or any of its Subsidiaries; 
 (v) the failure
by the Company or any of its Subsidiaries to make any principal or interest payment in respect of Indebtedness with an outstanding aggregate amount of $25.0 million or more (other than Non-Recourse Indebtedness) of the Company or any of its
Subsidiaries within five days of such principal or interest payment becoming due and payable (after giving effect to any applicable grace period set forth in the documents governing such Indebtedness); provided, that if such failure to
pay shall be remedied, waived or extended, then 
  

 36 

 
the Event of Default hereunder shall be deemed likewise to be remedied, waived or extended without further action by the Company; 

(vi) a final judgment or judgments that exceed $25.0 million or more in the aggregate, for the payment of money, having
been entered by a court or courts of competent jurisdiction against the Company or any of its Subsidiaries and such judgment or judgments is not satisfied, stayed, annulled or rescinded within 60 days of being entered; 

(vii) the Company or any Material Subsidiary pursuant to or within the meaning of any Bankruptcy Law: 

(A) commences a voluntary case; 

(B) consents to the entry of an order for relief against it in an involuntary case; 

(C) consents to the appointment of a Custodian of it or for all or substantially all of its property; or 

(D) makes a general assignment for the benefit of its creditors; 

(viii) a court of competent jurisdiction enters an order or decree under any Bankruptcy Law that: 

(A) is for relief against the Company or any Material Subsidiary as debtor in an involuntary case; 

(B) appoints a Custodian of the Company or any Material Subsidiary or a Custodian for all or substantially all of the
property of the Company or any Material Subsidiary; or 
 (C) orders the liquidation of the Company or any
Material Subsidiary and the order or decree remains unstayed and in effect for 60 days; or 
 (ix) any
Subsidiary Guarantee ceases to be in full force and effect (other than in accordance with the terms of such Subsidiary Guarantee and this Indenture) or is declared null and void and unenforceable or found to be invalid or any Subsidiary Guarantor
denies its liability under its Subsidiary Guarantee (other than by reason of release of a Subsidiary Guarantor from its Subsidiary Guarantee in accordance with the terms of this Indenture and the Subsidiary Guarantee). 

(b) A Default under clause (a)(iii) of Section 6.01 hereof shall not be deemed an Event of Default until the Trustee notifies the
Company, or the Holders of at least 25% in principal amount of the then outstanding Notes notify the Company and the Trustee, of 

 

 37 

 
the Default and the Company does not cure the Default within 60 days after receipt of the notice. The notice must specify the Default, demand that it be remedied and state that the notice is a
“Notice of Default.” If such a Default is cured within such time period, it shall cease. 
 (c) The Trustee may
withhold from the Holders notice of any continuing Default or Event of Default (except any Default or Event of Default in payment of principal or interest on the Notes or that resulted from the failure to comply with Section 3.03 hereof) if the
Trustee determines that withholding such notice is in the Holders’ interest. 
 Section 6.02 Acceleration;
Rescission. 
 (a) If an Event of Default (other than an Event of Default specified in clause (vii) or (viii) of
Section 6.01(a) hereof) shall have occurred and be continuing under this Indenture, the Trustee by notice to the Company, or the Holders of at least 25% in principal amount of the Notes then outstanding by notice to the Company and the Trustee,
may declare all Notes to be due and payable immediately. Upon such declaration of acceleration, the amounts due and payable on the Notes, as determined pursuant to Section 6.02(b), shall be due and payable immediately. If an Event of Default
with respect to the Company specified in clause (vii) or (viii) of Section 6.01(a) hereof occurs, such an amount will ipso facto become and be immediately due and payable without any declaration, notice or other act on the part
of the Trustee and the Company or any Holder. 
 (b) In the event that the maturity of the Notes is accelerated pursuant to
Section 6.02(a) hereof, 100% of the principal amount of the Notes (or, in the case of a default under clause (ii) or (iii) of Section 6.01 hereof resulting from a breach of Section 3.03 of the Thirteenth Supplemental
Indenture, dated as of May 20, 2010, 101% of the principal amount of the Notes that have been surrendered for repurchase pursuant to Section 3.03 thereof) shall become due and payable plus accrued interest, if any, to the date of payment.

 (c) Holders of a majority in principal amount of the then outstanding Notes may rescind an acceleration and its consequence
(except an acceleration due to nonpayment of principal or interest on the Notes, whether resulting from a breach of Section 3.03 of the Thirteenth Supplemental Indenture, dated as of May 20, 2010, or otherwise) if the rescission would not
conflict with any judgment or decree relating to the Notes and if all existing Events of Default have been cured or waived. Upon any such waiver, such Default shall cease to exist, and any Event of Default arising therefrom shall be deemed to have
been cured for every purpose of this Indenture; but no such waiver shall extend to any subsequent or other Default or impair any right consequent thereon.” 

Section 5.03 Amendment, Supplement and Waiver. 

(a) Subject to clause (c) of this Section 5.03, the Notes may be amended or supplemented with the consent (which may include
consents obtained in connection with a tender offer or exchange offer for Notes) of the Holders of at least a majority in principal amount of the Notes then outstanding, and any existing Default or Event of Default (other than any continuing Default
or Event of Default in the payment of interest on or the principal of the Notes) 
  

 38 

 
under, or compliance with any provision of, this Supplemental Indenture may be waived with the consent (which may include consents obtained in connection with a tender offer or exchange offer for
Notes) of the Holders of a majority in principal amount of the Notes then outstanding. Any Default that is waived or cured stops continuing and any Event of Default arising therefrom is deemed cured; but no such waiver shall extend to any subsequent
or other Default or impair any right consequent thereon. 
 (b) The Company, the Subsidiary Guarantors and the Trustee may
amend or supplement the Indenture or the Notes or waive any provisions thereof, hereof or thereof without notice to or consent of any Holder of Notes: 

(i) to cure any ambiguity, defect or inconsistency or to comply with Section 3.06 hereof; 

(ii) to provide for uncertificated Notes in addition to, or in place of, certificated Notes; 

(iii) to provide for any Subsidiary Guarantee of the Notes, to add security to or for the benefit of the Notes, or to
confirm and evidence the release, termination or discharge of any Subsidiary Guarantee of the Notes when such release, termination or discharge is permitted by the Indenture; 

(iv) to add covenants or new events of default for the protection of the Holders; 

(v) to make any change that does not adversely affect the legal rights under the Indenture of any Holder; or 

(vi) to comply with or qualify the Indenture under the TIA. 

(c) Without the consent of each Holder, the Company, may not: 

(i) reduce the amount of Notes whose Holders must consent to an amendment, supplement or waiver; 

(ii) reduce the rate of, or change the time for payment of, interest, including default interest, on any Note;

 (iii) reduce the principal of, or change the fixed maturity of, any Note or alter the provisions with respect
to redemption contained in Exhibit A hereof; 
 (iv) make any Note payable in currency other than that
stated in the Note; 
 (v) make any change in Section 4.01 of the Base Indenture or this Section 5.03;

  

 39 

 (vi) modify the ranking or priority of the Notes or any Subsidiary
Guarantee; 
 (vii) modify any of the provisions with respect to mandatory offers to repurchase Notes pursuant
to Section 3.03 hereof after the occurrence of a Change of Control; 
 (viii) release any Subsidiary
Guarantor from any of its obligations under its Subsidiary Guarantee or the Indenture otherwise than in accordance with the terms contained herein; or 

(ix) waive a continuing Default or Event of Default in the payment of principal of or interest on the Notes. 

(d) It shall not be necessary for the consent of the Holders under this Section 5.03 to approve the particular form of any proposed
supplement, but it shall be sufficient if such consent approves the substance thereof. 
 (e) After any supplement or amendment
under this Article becomes effective, the Company shall mail to the Holders a notice briefly describing such supplement or amendment; provided, however, that the failure to give such notice to all Holders, or any defect
therein, shall not impair or affect the validity of such supplement or amendment. 
 (f) The right of any Holder to participate
in any consent required or sought pursuant to any provision of the Indenture (and the obligation of the Company to obtain any such consent otherwise required from such Holder) may be subject to the requirement that such Holder shall have been the
Holder of record of Notes with respect to which such consent is required or sought as of a date identified by the Company in a notice furnished to Holders in accordance with the terms of the Indenture. 

(g) Section 6.04 of the Base Indenture is hereby replaced in its entirety with the following: “Section 6.04 [Reserved]”.

 Section 5.04 Compliance Certificate. 

Section 4.03 of the Base Indenture is hereby replaced in its entirety as follows: 

“Section 4.03 Compliance Certificate. 

The Company shall deliver to the Trustee a quarterly statement regarding compliance with the Indenture, and include in such statement, if
any Officer of the Company is aware of any Default or Event of Default, a statement specifying such Default or Event of Default and what action the Company is taking or proposes to take with respect thereto. In addition, the Company shall deliver to
the Trustee prompt written notice of the occurrence of any Default or Event of Default and any other development, financial or otherwise, which might materially affect its business, properties or affairs or the ability of the Company to perform its
obligations under the Indenture.” 
  

 40 

 Section 5.05 Indenture. 

(a) The Base Indenture is in all respects ratified and confirmed. 

(b) In the event of any conflict between this Supplemental Indenture and the Base Indenture, the provisions of this Supplemental
Indenture shall prevail. 
 Section 5.06 Notices. 

Any notice or communication by the Company, any Subsidiary Guarantor or the Trustee to the others is duly given if in writing and
delivered in person or mailed by first-class mail (registered or certified, return receipt requested), fax or overnight air courier guaranteeing next day delivery, to the others’ address: 

If to the Company and/or any Subsidiary Guarantor: 

c/o Beazer Homes USA, Inc. 

1000 Abernathy Road 

Atlanta, Georgia 30328 

Fax: (770) 481-2808 

Attention: Kenneth F. Khoury 

If to the Trustee: 

U.S. Bank National Association 

Corporate Trust Services 

1349 West Peachtree Street NW 

Suite 1050 

Atlanta, Georgia 30309 

Fax No.: (404) 898-8844 

Attention: Beazer 9.125% Notes (2010 Indenture) 

The Company, any Subsidiary Guarantor or the Trustee, by notice to the others, may designate additional or different addresses for
subsequent notices or communications. 
 All notices and communications (other than those sent to Holders) shall be deemed to
have been duly given: at the time delivered by hand, if personally delivered; five calendar days after being deposited in the mail, postage prepaid, if mailed by first-class mail; when receipt acknowledged, if faxed; and the next Business Day after
timely delivery to the courier, if sent by overnight air courier guaranteeing next day delivery; provided that any notice or communication delivered to the Trustee shall be deemed effective upon actual receipt thereof. 

Any notice or communication to a Holder shall be mailed by first-class mail, certified or registered, return receipt requested, or by
overnight air courier guaranteeing next day delivery to its address shown on the register kept by the Registrar. Any notice or communication shall also be so mailed to any Person described in TIA Section 313(c), to the extent required by the
TIA. Failure to mail a notice or communication to a Holder or any defect in it shall not affect its sufficiency with respect to other Holders. 
  

 41 

 If a notice or communication is mailed in the manner provided above within the time
prescribed, it is duly given, whether or not the addressee receives it. 
 If the Company mails a notice or communication to
Holders, it shall mail a copy to the Trustee and each Agent at the same time. 
 Section 5.07 No Personal Liability of
Incorporators, Shareholders, Officers, Directors or Employees. 
 No recourse for the payment of the principal of, premium,
if any, or interest on any of the Notes, or for any claim based thereon or otherwise in respect thereof, and no recourse under or upon any obligation, covenant or agreement of the Company or any Subsidiary Guarantor herein or in any of the Notes or
because of the creation of any Indebtedness represented thereby, shall be had against any incorporator, shareholder, officer, director, employee or controlling person of the Company, any Subsidiary Guarantor or any successor Person thereof. Each
Holder, by accepting such Notes waives and releases all such liability. 
 Section 5.08 Governing Law. 

THIS SUPPLEMENTAL INDENTURE, THE NOTES AND THE SUBSIDIARY GUARANTEES WILL BE GOVERNED BY THE LAWS OF THE STATE OF NEW YORK. 

Section 5.09 No Adverse Interpretation of Other Agreements. 

This Supplemental Indenture may not be used to interpret another indenture, loan or debt agreement of the Company or its Restricted
Subsidiaries or of any other Person. Any such indenture, loan or debt agreement may not be used to interpret this Supplemental Indenture. 

Section 5.10 Successors and Assigns. 

All covenants and agreements of the Company and the Subsidiary Guarantors in this Supplemental Indenture and the Notes shall bind its
successors and assigns. All agreements of the Trustee in this Supplemental Indenture shall bind its successors and assigns. 

Section 5.11 Duplicate Originals. 

The parties may sign any number of copies of this Supplemental Indenture. Each signed copy shall be an original, but all of them together
represent the same agreement. 
 Section 5.12 Severability. 

In case any one or more of the provisions contained in this Supplemental Indenture or in the Notes shall for any reason be held to be
invalid, illegal or unenforceable, the validity, legality and enforceability of the remaining provisions shall not in any way be affected or impaired thereby. 
  

 42 

 Section 5.13 Trustee Not Responsible for Recitals. 

The recitals herein contained are made by the Company and not by the Trustee, and the Trustee assumes no responsibility for the
correctness thereof. The Trustee makes no representation as to the validity or sufficiency of this Supplemental Indenture. 

Section 5.14 Trustee Rights. 

Without limiting Section 7.01 of the Base Indenture, the Trustee shall have no duty to inquire as to the performance of the Company
with respect to any of its covenants contained in Article Three of this Supplemental Indenture. 
 [Signature pages
follow] 
  

 43 

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

					
	 BEAZER HOMES USA, INC.

		
	By:	 	 /s/ Allan P. Merrill

		 	Name:	 	Allan P. Merrill
		 	Title:	 	 Executive Vice President and

Chief Financial Officer

  

					
	 APRIL CORPORATION

	 BEAZER ALLIED COMPANIES HOLDINGS, INC.

	 BEAZER GENERAL SERVICES, INC.

	 BEAZER HOMES CORP.

	 BEAZER HOMES HOLDINGS CORP.

	 BEAZER HOMES INDIANA HOLDINGS CORP.

	 BEAZER HOMES SALES, INC.

	 BEAZER HOMES TEXAS HOLDINGS, INC.

	 BEAZER REALTY CORP.

	 BEAZER REALTY, INC.

	 BEAZER REALTY LOS ANGELES, INC.

	 BEAZER REALTY SACRAMENTO, INC.

	 BEAZER/SQUIRES REALTY, INC.

	 HOMEBUILDERS TITLE SERVICES OF VIRGINIA, INC.

	 HOMEBUILDERS TITLE SERVICES, INC.

		
	By:	 	 /s/ Allan P. Merrill

		 	Name:	 	Allan P. Merrill
		 	Title:	 	Executive Vice President

 [SIGNATURE
PAGE TO INDENTURE] 
  

					
	BEAZER MORTGAGE CORPORATION
		
	By:	 	 /s/ Allan P. Merrill

		 	Name:	 	Allan P. Merrill
		 	Title:	 	President
	
	 BEAZER HOMES INDIANA LLP

		
	By:	 	 BEAZER HOMES INVESTMENTS, LLC,

		 	 its Managing Partner

		
	By:	 	 BEAZER HOMES CORP.,

		 	 its Sole Member

		
	By:	 	 /s/ Allan P. Merrill

		 	Name:	 	Allan P. Merrill
		 	Title:	 	Executive Vice President
	
	ARDEN PARK VENTURES, LLC
	BEAZER CLARKSBURG, LLC BEAZER COMMERCIAL HOLDINGS, LLC
	DOVE BARRINGTON DEVELOPMENT LLC
	BEAZER HOMES INVESTMENTS, LLC
	BEAZER HOMES MICHIGAN, LLC
	ELYSIAN HEIGHTS POTOMIA, LLC
		
	By:	 	 BEAZER HOMES CORP.,

its Sole Member

		
	By:	 	 /s/ Allan P. Merrill

		 	Name:	 	Allan P. Merrill
		 	Title:	 	Executive Vice President

 [SIGNATURE
PAGE TO INDENTURE] 

					
	BEAZER HOMES TEXAS, L.P.
		
	 By: 
	 	 BEAZER HOMES TEXAS HOLDINGS, INC.,

its General Partner

		
	By:	 	 /s/ Allan P. Merrill

		 	Name:	 	 Allan P. Merrill

		 	Title:	 	 Executive Vice President

	
	BEAZER REALTY SERVICES, LLC
		
	By:	 	 BEAZER HOMES INVESTMENTS, LLC,

its Sole Member

		
	By:	 	 BEAZER HOMES CORP.,

its Sole Member

		
	By:	 	 /s/ Allan P. Merrill

		 	Name:	 	 Allan P. Merrill

		 	Title:	 	 Executive Vice President

	
	BEAZER SPE, LLC
		
	By:	 	 BEAZER HOMES HOLDINGS CORP.,

its Sole Member

		
	By:	 	 /s/ Allan P. Merrill

		 	Name:	 	 Allan P. Merrill

		 	Title:	 	 Executive Vice President

[SIGNATURE PAGE TO INDENTURE] 

					
	BH BUILDING PRODUCTS, LP
		
	By:	 	 BH PROCUREMENT SERVICES, LLC,

its General Partner

		
	By:	 	 BEAZER HOMES TEXAS, L.P.,

its Sole Member

		
	By:	 	 BEAZER HOMES TEXAS HOLDINGS, INC.,

its General Partner

		
	By:	 	 /s/ Allan P. Merrill

		 	Name:	 	Allan P. Merrill 
		 	Title:	 	Executive Vice President
	
	BH PROCUREMENT SERVICES, LLC
		
	By:	 	 BEAZER HOMES TEXAS, L.P.,

its Sole Member

		
	By:	 	 BEAZER HOMES TEXAS HOLDINGS, INC.,

its General Partner

		
	By:	 	 /s/ Allan P. Merrill

		 	Name:	 	Allan P. Merrill 
		 	Title:	 	Executive Vice President

 [SIGNATURE
PAGE TO INDENTURE] 

					
	PARAGON TITLE, LLC
		
	By:	 	 BEAZER HOMES INVESTMENTS, LLC,

its Sole Member and Manager

		
	By:	 	 BEAZER HOMES CORP.,

its Sole Member

		
	By:	 	 /s/ Allan P. Merrill

		 	Name:	 	 Allan P. Merrill

		 	Title:	 	Executive Vice President
	
	TRINITY HOMES, LLC
		
	By:	 	 BEAZER HOMES INVESTMENTS, LLC,

its Member

		
	By:	 	 BEAZER HOMES CORP.,

its Sole Member

		
	By:	 	 /s/ Allan P. Merrill

		 	Name:	 	 Allan P. Merrill

		 	Title:	 	Executive Vice President
	
	CLARKSBURG ARORA LLC
		
	By:	 	 BEAZER CLARKSBURG, LLC,

its Sole Member

		
	By:	 	 BEAZER HOMES CORP.,

its Sole Member

		
	By:	 	 /s/ Allan P. Merrill

		 	Name:	 	Allan P. Merrill 
		 	Title:	 	Executive Vice President

 [SIGNATURE
PAGE TO INDENTURE] 
  

					
	CLARKSBURG SKYLARK, LLC
		
	By:	 	 CLARKSBURG ARORA LLC,

its Sole Member

		
	By:	 	 BEAZER CLARKSBURG, LLC,

its Sole Member

		
	By:	 	 BEAZER HOMES CORP.,

its Sole Member

		
	By:	 	 /s/ Allan P. Merrill

		 	Name:	 	Allan P. Merrill
		 	Title:	 	Executive Vice President

 [SIGNATURE
PAGE TO INDENTURE] 

					
	 U.S. BANK NATIONAL ASSOCIATION

as Trustee

		
	By:	 	 /s/ William B. Echols

		 	Name:	 	 William B. Echols

		 	Title:	 	Vice President

 [SIGNATURE PAGE TO
INDENTURE] 

 SCHEDULE I 

Subsidiary Guarantors 

Beazer General Services, Inc. 
 Beazer Homes
Corp. 
 Beazer/Squires Realty, Inc. 

Beazer Homes Sales, Inc. 
 Beazer Homes
Investments, LLC 
 Beazer Realty Corp. 

Beazer Homes Holdings Corp. 
 Beazer Homes
Indiana Holdings Corp. 
 Beazer Homes Texas Holdings, Inc. 

Beazer Homes Texas, L.P. 
 Beazer Homes Indiana
LLP 
 April Corporation 
 Beazer SPE,
LLC 
 Beazer Realty, Inc. 
 Beazer
Realty Services, LLC 
 Beazer Realty Los Angeles, Inc. 

Beazer Realty Sacramento, Inc. 
 BH Building
Products, LP 
 BH Procurement Services, LLC 

Homebuilders Title Services of Virginia, Inc. 

Homebuilders Title Services, Inc. 
 Beazer Allied
Companies Holdings, Inc. 
 Paragon Title, LLC 

Trinity Homes, LLC 
 Beazer Commercial Holdings,
LLC 
 Beazer Clarksburg, LLC 
 Arden
Park Ventures, LLC 
 Beazer Mortgage Corporation 

Beazer Homes Michigan, LLC 
 Dove Barrington
Development LLC 
 Clarksburg Arora LLC 

Clarksburg Skylark, LLC 
 Elysian Heights
Potomia, LLC 
 SCHEDULE I 

 EXHIBIT A 

[Face of Note] 

[THIS GLOBAL NOTE IS HELD BY THE DEPOSITARY (AS DEFINED IN THE INDENTURE GOVERNING THIS NOTE) OR ITS NOMINEE IN CUSTODY FOR THE
BENEFIT OF THE BENEFICIAL OWNERS HEREOF, AND IS NOT TRANSFERABLE TO ANY PERSON UNDER ANY CIRCUMSTANCES EXCEPT THAT (I) THE TRUSTEE MAY MAKE SUCH NOTATIONS HEREON AS MAY BE REQUIRED PURSUANT TO SECTION 2.15(d) OF THE INDENTURE, (II) THIS GLOBAL
NOTE MAY BE EXCHANGED IN WHOLE BUT NOT IN PART PURSUANT TO SECTION 2.15(b) OF THE INDENTURE, (III) THIS GLOBAL NOTE MAY BE DELIVERED TO THE TRUSTEE FOR CANCELLATION PURSUANT TO SECTION 2.10 OF THE INDENTURE AND (IV) THIS GLOBAL NOTE MAY BE
TRANSFERRED TO A SUCCESSOR DEPOSITARY WITH THE PRIOR WRITTEN CONSENT OF THE COMPANY. UNLESS AND UNTIL IT IS EXCHANGED IN WHOLE OR IN PART FOR NOTES IN DEFINITIVE FORM, THIS NOTE MAY NOT BE TRANSFERRED EXCEPT AS A WHOLE BY THE DEPOSITARY TO A NOMINEE
OF THE DEPOSITARY OR BY A NOMINEE OF THE DEPOSITARY TO THE DEPOSITARY OR ANOTHER NOMINEE OF THE DEPOSITARY OR BY THE DEPOSITARY OR ANY SUCH NOMINEE TO A SUCCESSOR DEPOSITARY OR A NOMINEE OF SUCH SUCCESSOR DEPOSITARY. UNLESS THIS CERTIFICATE IS
PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY (55 WATER STREET, NEW YORK, NEW YORK) (“DTC”) TO THE COMPANY OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED
IN THE NAME OF CEDE & CO. OR SUCH OTHER NAME AS MAY BE REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR SUCH OTHER ENTITY AS MAY BE REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY
TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST
HEREIN.]1 

 
  

	1
	 This paragraph should be included if the Note is issued in global form. 

 

 A-1 

 CUSIP: 07556Q AV7 

ISIN: US07556QAV77 

9.125% Senior Notes due 2018 
  

					
	No.     	  		  	[$                    ]

BEAZER HOMES USA, INC. 

a Delaware corporation 

promises to pay to [CEDE & CO. or registered
assigns]1
[                    
]2, the principal sum [set forth on the Schedule of
Exchanges of Interests in the Global Note attached
hereto]1
[of                                        
United States Dollars]2 on June 15, 2018. 

Interest Payment Dates: June 15 and December 15 

Record Dates: June 1 and December 1 

 

	1
	 If the Note is issued in global form. 

	2
	 If the Note is issued in definitive form. 

  

 A-2 

 IN WITNESS HEREOF, the Company has caused this instrument to be duly executed. 

Dated: 
  

			
	BEAZER HOMES USA, INC. 
		
	By:	 	  

		 	 Name:

Title:

		
	By:	 	  

		 	 Name:

Title:

  

 A-3 

 This is one of the Notes referred to in the within-mentioned Indenture. 

 

			
	 U.S. BANK NATIONAL ASSOCIATION,

as Trustee

		
	 By:
	 	  

		 	Authorized Signatory

  

 A-4 

 [Back of Note] 

9.125% Senior Notes due 2018 

Capitalized terms used herein shall have the meanings assigned to them in the Indenture referred to below unless otherwise indicated.

  

	1.	Interest. 

 Beazer Homes
USA, Inc., a Delaware corporation (the “Company”), promises to pay interest on the principal amount of this Note at 9.125% per annum from May 20, 2010 until maturity. The Company will pay interest, semi-annually in arrears
on June 15 and December 15 of each year, or if any such day is not a Business Day, on the next succeeding Business Day (each, an “Interest Payment Date”). Interest on the Notes will accrue from the most recent date to
which interest has been paid or, if no interest has been paid, from the Issue Date; provided that the first Interest Payment Date shall be June 15, 2010. Interest will be computed on the basis of a 360-day year of twelve 30-day
months. The Company will pay interest (including post-petition interest in any proceeding under any Bankruptcy Law) on overdue principal and premium, if any, from time to time on demand at the interest rate on the Notes to the extent lawful; it
shall pay interest (including post-petition interest in any proceeding under any Bankruptcy Law) on overdue installments of interest from time to time on demand at the interest rate on the Notes to the extent lawful. 

 

	2.	Method of Payment. 

 The
Company will pay interest on the Notes to the Persons who are registered Holders of Notes at the close of business on the June 1 or December 1 (whether or not a Business Day), as the case may be, next preceding the applicable Interest
Payment Date, even if such Notes are canceled after such Record Date and on or before such Interest Payment Date, except as provided in Section 2.11 of the Base Indenture with respect to defaulted interest. At the option of the Company, payment
of interest may be made by check mailed to the Holders at their addresses set forth in the register of Holders, provided that payments of principal, premium, if any, and interest with respect to Notes represented by one or more
permanent Global Notes registered in the name of or held by The Depository Trust Company (“DTC”) or its nominee will be made by wire transfer of immediately available funds to the accounts specified by the Holder or Holders thereof.
Such payment shall be in such coin or currency of the United States of America as at the time of payment is legal tender for payment of public and private debts. 
  

	3.	Paying Agent And Registrar. 

Initially, U.S. Bank National Association, the Trustee under the Indenture, will act as Paying Agent and Registrar. The Company may change
any Paying Agent or Registrar without notice to the Holders. The Company or any of its Subsidiaries may act in any such capacity. 
  

	4.	Indenture. 

  

 A-5 

 The Company issued the Notes under the Thirteenth Supplemental Indenture, dated as of
May 20, 2010 (the “Supplemental Indenture”), to the Indenture, dated as of April 17, 2002 (as amended, modified or supplemented from time to time prior to the date of the Supplemental Indenture in accordance therewith, the
“Base Indenture” and, together with the Supplemental Indenture, the “Indenture”), among the Company, the Subsidiary Guarantors named therein and the Trustee. The terms of the Notes include those stated in the
Indenture and those made part of the Indenture by reference to the Trust Indenture Act of 1939, as amended (the “TIA”). The Notes are subject to all such terms, and Holders are referred to the Indenture and the TIA for a statement
of such terms. To the extent any provision of this Note conflicts with the express provisions of the Indenture, the provisions of the Indenture shall govern and be controlling. 

 

	5.	Optional Redemption. 

 (a)
Prior to June 15, 2014, the Company may, at its option, redeem the Notes, in whole or in part, at a redemption price equal to 100% of the principal amount of the Notes to be redeemed plus the Applicable Premium as of, and accrued and unpaid
interest to, the redemption date (subject to the right of Holders on the relevant record date to receive interest due on the relevant interest payment date). Notice of such redemption must be mailed by first class mail to each Holder’s
registered address, not less than 15 nor more than 60 days prior to the redemption date. 
 (b) The Company may redeem all or
any portion of the Notes at any time and from time to time on or after June 15, 2014 and prior to maturity at the following redemption prices (expressed in percentages of the principal amount thereof) together, in each case, with accrued and
unpaid interest to the date fixed for redemption, if redeemed during the 12-month period beginning on June 15 of each year indicated below: 
  

				
	 Year
	  	Percentage	 
	 2014
	  	104.563	% 
	 2015
	  	102.281	% 
	 2016 and thereafter
	  	100.000	% 

 (c) On or
prior to June 15, 2013, the Company may, at its option, redeem up to 35% of the aggregate principal amount of Notes issued under the Supplemental Indenture with the net proceeds of an Equity Offering at 109.125% of the principal amount thereof
plus accrued and unpaid interest, if any, to the date fixed for redemption; provided, that at least 65% of the aggregate principal amount of the Notes originally issued under the Supplemental Indenture remain outstanding after such
redemption. Notice of any such redemption must be given within 60 days after the date of the closing of the relevant Equity Offering. 

(d) If the Company redeems less than all of the outstanding Notes, the Trustee shall select the Notes to be redeemed in the manner
described under Section 3.02 of the Indenture. 
 (e) Any redemption pursuant to this paragraph 5 shall be made
pursuant to the provisions of Article Three of the Indenture. 
  

 A-6 

	6.	Offers To Repurchase. 

The Company shall be required to make offers to repurchase the Notes as set forth under Section 3.03 of the Supplemental Indenture.

  

	7.	Denominations, Transfer, Exchange. 

The Notes are in registered form without coupons in denominations of $2,000 and integral multiples of $1,000 in excess thereof. The
transfer of Notes may be registered and may be exchanged as provided in the Indenture. The Registrar and the Trustee may require a Holder, among other things, to furnish appropriate endorsements and transfer documents and the Company may require a
Holder to pay any taxes and fees required by law or permitted by the Indenture. The Company need not exchange or register the transfer of any Notes or portion of the Notes selected for redemption, except for the unredeemed portion of any Notes being
redeemed in part. Also, the Company need not exchange or register the transfer of any Notes for a period of 15 days before a selection of Notes to be redeemed. 
  

	8.	Persons Deemed Owners. 

The registered Holder of a Notes may be treated as its owner for all purposes. 

 

	9.	Amendment, Supplement And Waiver. 

The Indenture, the Subsidiary Guarantees or the Notes may be amended or supplemented as provided in the Indenture. 

 

	10.	Authentication. 

 This
Note shall not be entitled to any benefit under the Indenture or be valid or obligatory for any purpose until authenticated by the manual or facsimile signature of the Trustee. 

 

	11.	Governing Law. 

 THE
INDENTURE, THE NOTES AND ANY SUBSIDIARY GUARANTEE WILL BE GOVERNED BY THE LAWS OF THE STATE OF NEW YORK. 
  

	12.	CUSIP/ISIN Numbers. 

Pursuant to a recommendation promulgated by the Committee on Uniform Security Identification Procedures, the Company has caused CUSIP/ISIN
numbers to be printed on the Notes and the Trustee may use CUSIP/ISIN numbers in notices of redemption as a convenience to Holders. No representation is made as to the accuracy of such numbers either as printed on the Notes or as contained in any
notice of redemption and reliance may be placed only on the other identification numbers placed thereon. 
  

	13.	Successor Corporation. 

  

 A-7 

 When a successor corporation assumes all the obligations of its predecessor under the Notes
and the Indenture, the predecessor corporation will be released from those obligations. 
  

	14.	Trustee Dealings With Company. 

U.S. Bank National Association, the Trustee under the Indenture, in its individual or any other capacity, may make loans to, accept
deposits from, and perform services for the Company or its affiliates, and may otherwise deal with the Company or its affiliates, as if it were not Trustee. 
  

	15.	Abbreviations. 

 Customary
abbreviations may be used in the name of a Holder or an assignee, such as: TEN COM (= tenants in common), TEN ENT (= tenants by the entireties), JT TEN (= joint tenants with right of survivorship and not as tenants in common), CUST (= custodian),
and U/G/M/A (= Uniform Gifts to Minors Act). 
 The Company will furnish to any Holder upon written request and without charge a
copy of the Indenture. Requests may be made to the Company at the following address: 
 c/o Beazer Homes USA, Inc. 

1000 Abernathy Road, Suite 1200 

Atlanta, Georgia 30328 

Fax No.: (770) 481-2808 

Attention: Kenneth F. Khoury 
  

 A-8 

 ASSIGNMENT FORM 

To assign this Note, fill in the form below: 
  

					
	(I) or (we) assign and transfer this Note to:	 	  
	  	
		 	(Insert assignee’s legal name)	  	

  

			
	  

	(Insert assignee’s soc. sec. or tax I.D. no.)

	  

	  

	  

	  

	(Print or type assignee’s name, address and zip code)

					
	and irrevocably appoint	 	  

to transfer this Note on the books of the Company. The agent may substitute another to act for him. 

 

			
	Date:	 	 

  

			
	Your Signature:	 	  

		 	(Sign exactly as your name appears on the face of this Note)

 

							
		 	Signature Guarantee*:	 	  
	 	

  

	*	Participant in a recognized Signature Guarantee Medallion Program (or other signature guarantor acceptable to the Trustee). 

 

 A-9 

 OPTION OF HOLDER TO ELECT PURCHASE 

If you want to elect to have this Note purchased by the Company pursuant to Section 3.03 of the Supplemental Indenture, check the
box below: 
 [    ] Section 3.03 

If you want to elect to have only part of this Note purchased by the Company pursuant to Section 3.03 of the Supplemental Indenture,
state the amount you elect to have purchased: 

$                      
           
  

			
	Date:	 	 

  

			
	Your Signature:	 	  

		 	(Sign exactly as your name appears on the face of this
Note)

			
	Tax Identification No.:	 	  

 

							
		 	Signature Guarantee*:	 	  
	 	

 * Participant in a recognized Signature Guarantee Medallion Program (or other signature guarantor acceptable to the
Trustee). 
  

 A-10 

 SCHEDULE OF EXCHANGES OF INTERESTS IN THE GLOBAL NOTE* 

The initial outstanding principal amount of this Global Note is
$                    . The following exchanges of a part of this Global Note for an interest in another Global Note or for a Definitive Note, or
exchanges of a part of another Global or Definitive Note for an interest in this Global Note, have been made: 
  

									
	 Date of

Exchange
	  	Amount of decrease
in Principal Amount of this
Global Note	  	Amount of
increase
in Principal
Amount
of this
Global Note	  	Principal
Amount of
this
Global
Note
following such
decrease or
increase	  	Signature of
authorized
officer
of
Trustee or 
Custodian
		  		  		  		  	

  

	*	This schedule should be included only if the Note is issued in global form. 

  

 A-11 

 [FORM OF NOTATION ON NOTE RELATING TO GUARANTEE] 

GUARANTEE 

April Corporation, Arden Park Ventures, LLC, Beazer Allied Companies Holdings, Inc., Beazer Clarksburg, LLC, Beazer Commercial Holdings,
LLC, Beazer General Services, Inc., Beazer Homes Corp., Beazer Homes Holdings Corp., Beazer Homes Indiana Holdings Corp., Beazer Homes Indiana LLP, Beazer Homes Investments, LLC, Beazer Homes Michigan, LLC, Beazer Homes Sales, Inc., Beazer Homes
Texas Holdings, Inc., Beazer Homes Texas, L.P., Beazer Mortgage Corporation, Beazer Realty Corp., Beazer Realty, Inc., Beazer Realty Los Angeles, Inc., Beazer Realty Sacramento, Inc., Beazer Realty Services, LLC, Beazer SPE, LLC, Beazer/Squires
Realty, Inc., BH Building Products, LP, BH Procurement Services, LLC, Clarksburg Arora LLC, Clarksburg Skylark, LLC, Dove Barrington Development LLC, Elysian Heights Potomia, LLC, Homebuilders Title Services of Virginia, Inc., Homebuilders Title
Services, Inc., Paragon Title, LLC and Trinity Homes, LLC (the “Subsidiary Guarantors”) have unconditionally guaranteed, jointly and severally (such guarantee by each Subsidiary Guarantor being referred to herein as the
“Subsidiary Guarantee”), that (i) the principal of, premium, if any, and interest on the Notes will be duly and punctually paid in full when due, whether at maturity, by acceleration or otherwise, and interest on the overdue
principal and (to the extent permitted by law) interest, if any, on the Notes and all other obligations of the Company to the Holders or the Trustee all in accordance with the terms set forth under Article Four of the Supplemental Indenture, and
(ii) in case of any extension of time of payment or renewal of any Notes, that the same will be promptly paid in full when due or performed in accordance with the terms of the extension or renewal, whether at maturity, by acceleration or
otherwise. 
 No recourse for the payment of the principal of, premium, if any, or interest on any of the Notes, or for any
claim based thereon or otherwise in respect thereof, and no recourse under or upon any obligation, covenant or agreement of the Company or any Subsidiary Guarantor in this Subsidiary Guarantee, the Indenture or any of the Notes or because of the
creation of any Indebtedness represented thereby, shall be had against any incorporator, shareholder, officer, director, employee or controlling person of any Subsidiary Guarantor or any successor Person thereof. Each Holder, by accepting such Notes
waives and releases all such liability. 
 Each Holder of a Note by accepting a Note agrees that any Subsidiary Guarantor named
below shall have no further liability with respect to its Subsidiary Guarantee if such Subsidiary Guarantor otherwise ceases to be liable in respect of its Subsidiary Guarantee in accordance with the terms of the Indenture. The Obligations of each
Guarantor under its Subsidiary Guarantee shall be limited to the extent necessary to insure that it does not constitute a fraudulent conveyance under applicable law. 

 

 A-12 

 The Subsidiary Guarantee shall not be valid or obligatory for any purpose until the
certificate of authentication on the Notes upon which the Subsidiary Guarantee is noted shall have been executed by the Trustee under the Indenture by the manual or facsimile signature of one of its authorized officers. 

 

			
	 APRIL CORPORATION

	 BEAZER ALLIED COMPANIES HOLDINGS, INC.

	 BEAZER GENERAL SERVICES, INC.

	 BEAZER HOMES CORP.

	 BEAZER HOMES HOLDINGS CORP.

	 BEAZER HOMES INDIANA HOLDINGS CORP.

	 BEAZER HOMES SALES, INC.

	 BEAZER HOMES TEXAS HOLDINGS, INC.

	 BEAZER REALTY CORP.

	 BEAZER REALTY, INC.

	 BEAZER REALTY LOS ANGELES, INC.

	 BEAZER REALTY SACRAMENTO, INC.

	 BEAZER/SQUIRES REALTY, INC.

	 HOMEBUILDERS TITLE SERVICES OF VIRGINIA, INC.

	 HOMEBUILDERS TITLE SERVICES, INC.

		
	By:	 	  

		 	Name:
		 	Title:

  

 A-13 

			
	 BEAZER MORTGAGE CORPORATION

		
	By:	 	  

		 	Name:
		 	Title:
	
	 BEAZER HOMES INDIANA LLP

		
	By:	 	BEAZER HOMES INVESTMENTS, LLC,
		 	its Managing Partner
		
	By:	 	BEAZER HOMES CORP.,
		 	its Sole Member
		
	By:	 	  

		 	Name:
		 	Title:
	
	 ARDEN PARK VENTURES, LLC

	BEAZER CLARKSBURG, LLC 
	BEAZER COMMERCIAL HOLDINGS, LLC
	DOVE BARRINGTON DEVELOPMENT LLC
	BEAZER HOMES INVESTMENTS, LLC
	BEAZER HOMES MICHIGAN, LLC
	ELYSIAN HEIGHTS POTOMIA, LLC
		
	 By:
	 	 BEAZER HOMES CORP.,
 its
Sole Member

		
	 By:
	 	  

		 	Name:
		 	Title:

  

 A-14 

			
	BEAZER HOMES TEXAS, L.P.
	
	 By: BEAZER HOMES TEXAS HOLDINGS, INC.,

		 	its General Partner
		
	By:	 	  

		 	 Name:

Title:

	
	BEAZER REALTY SERVICES, LLC
		
	By:	 	 BEAZER HOMES INVESTMENTS, LLC,

its Sole Member

		
	By:	 	 BEAZER HOMES CORP.,
 its
Sole Member

		
	By:	 	  

		 	 Name :

Title:

	
	BEAZER SPE, LLC
		
	By:	 	 BEAZER HOMES HOLDINGS CORP.,

its Sole Member

		
	By:	 	  

		 	 Name:

Title:

  

 A-15 

			
	BH BUILDING PRODUCTS, LP
		
	By:	 	 BH PROCUREMENT SERVICES, LLC,

its General Partner

		
	By:	 	 BEAZER HOMES TEXAS, L.P.,

its Sole Member

		
	By:	 	 BEAZER HOMES TEXAS HOLDINGS, INC.,

its General Partner

		
	By:	 	  

		 	 Name:

Title:

	
	BH PROCUREMENT SERVICES, LLC
		
	By:	 	 BEAZER HOMES TEXAS, L.P.,

its Sole Member

		
	By:	 	 BEAZER HOMES TEXAS HOLDINGS, INC.,

its General Partner

		
	By:	 	  

		 	 Name:

Title:

  

 A-16 

			
	PARAGON TITLE, LLC
		
	By:	 	 BEAZER HOMES INVESTMENTS, LLC,

its Sole Member and Manager

		
	By:	 	 BEAZER HOMES CORP.,
 its
Sole Member

		
	By:	 	  

		 	 Name:

Title:

	
	TRINITY HOMES, LLC
		
	By:	 	 BEAZER HOMES INVESTMENTS, LLC,

its Member

		
	By:	 	 BEAZER HOMES CORP.,
 its
Sole Member

		
	By:	 	  

		 	 Name:

Title:

  

 A-17 

			
	CLARKSBURG ARORA LLC
		
	By:	 	 BEAZER CLARKSBURG, LLC,
 its
Sole Member

		
	By:	 	 BEAZER HOMES CORP.,
 its
Sole Member

		
	By:	 	  

		 	 Name:

Title:

	
	CLARKSBURG SKYLARK, LLC
		
	By:	 	 CLARKSBURG ARORA LLC,
 its
Sole Member

		
	By:	 	 BEAZER CLARKSBURG, LLC,
 its
Sole Member

		
	By:	 	 BEAZER HOMES CORP.,
 its
Sole Member

		
	By:	 	  

		 	 Name:

Title:

  

 A-18Class A(2010-B) Terms Document

 Exhibit 4.1 

Execution Version 
  

 
 DISCOVER CARD EXECUTION NOTE TRUST

 Issuer 

and 
 U.S. BANK
NATIONAL ASSOCIATION 
 Indenture Trustee 

CLASS A(2010-B) TERMS DOCUMENT 

Dated as of May 20, 2010 

to 
 INDENTURE
SUPPLEMENT 
 Dated as of July 26, 2007 

for the DiscoverSeries Notes 

to 
 INDENTURE

 Dated as of July 26, 2007 
  

 

 TABLE OF CONTENTS 

 

					
	 	  	 	  	Page
		
	ARTICLE I Definitions and Other Provisions of General Application	  	1
			
	Section 1.01.	  	Definitions	  	1
	Section 1.02.	  	Representations and Warranties of Issuer	  	7
	Section 1.03.	  	Representations and Warranties of Indenture Trustee	  	8
	Section 1.04.	  	Limitations on Liability	  	8
	Section 1.05.	  	Governing Law	  	9
	Section 1.06.	  	Counterparts	  	9
	Section 1.07.	  	Ratification of Indenture and Indenture Supplement	  	9
		
	ARTICLE II The Class A(2010-B) Notes	  	9
			
	Section 2.01.	  	Creation and Designation	  	9
	Section 2.02.	  	Adjustments to Required Subordinated Percentages and Amount	  	9
	Section 2.03.	  	Interest Payment	  	10
	Section 2.04.	  	Payments of Interest and Principal; Payments of Increased Costs Amount	  	10
	Section 2.05.	  	[Reserved]	  	11
	Section 2.06.	  	Form of Class A(2010-B) Notes; Legend; Transfer Restriction	  	11
	Section 2.07.	  	Delivery and Payment for the Class A(2010-B) Notes	  	12
	Section 2.08.	  	Additional Early Redemption Events	  	12
	Section 2.09.	  	Increases in the Outstanding Dollar Principal Amount	  	13
	Section 2.10.	  	Designation of Additional Amounts to be included in the Excess Spread Amount for the DiscoverSeries Notes	  	14

 Exhibit 

 

			
	Exhibit A	  	Form of Class A
Note                            

 

 i 

 THIS CLASS A(2010-B) TERMS DOCUMENT (this “Terms Document”), by and between
DISCOVER CARD EXECUTION NOTE TRUST, a statutory trust created under the laws of the State of Delaware (the “Issuer”), and U.S. BANK NATIONAL ASSOCIATION, a national banking association organized and existing under the laws of the
United States of America, as Indenture Trustee (the “Indenture Trustee”), is made and entered into as of May 20, 2010. 

Pursuant to this Terms Document, the Issuer shall create a new Tranche of Class A Notes of the DiscoverSeries and shall specify the
principal terms thereof. 
 ARTICLE I 

Definitions and Other Provisions of General Application 

Section 1.01. Definitions. For all purposes of this Terms Document, except as otherwise expressly provided or unless the context otherwise
requires: 
 (1) the terms defined in this Article have the meanings assigned to them in this Article, and include the plural as
well as the singular; 
 (2) all other terms used herein which are defined in the Note Purchase Agreement dated as of
May 20, 2010, by and among Discover Card Execution Note Trust, Discover Bank, the Purchaser (as defined therein), the Committed Purchaser (as defined therein) and the Agent (as defined therein) (as may be amended, supplemented, restated,
amended and restated or otherwise modified from time to time, the “Note Purchase Agreement”), the Indenture Supplement or the Indenture, either directly or by reference therein, have the meanings assigned to them therein;

 (3) all accounting terms not otherwise defined herein have the meanings assigned to them in accordance with generally
accepted accounting principles and, except as otherwise herein expressly provided, the term “generally accepted accounting principles” with respect to any computation required or permitted hereunder means such accounting principles as are
generally accepted in the United States of America at the date of such computation; 
 (4) all references in this Terms Document
to designated “Articles,” “Sections” and other subdivisions are to the designated Articles, Sections and other subdivisions of this Terms Document; the words “herein,” “hereof” and “hereunder” and
other words of similar import refer to this Terms Document as a whole and not to any particular Article, Section or other subdivision; 

(5) in the event that any term or provision contained herein shall conflict with or be inconsistent with any term or provision contained
in the Indenture Supplement or the Indenture, the terms and provisions of this Terms Document shall be controlling, but solely with respect to the Class A(2010-B) Notes; 

(6) each capitalized term defined herein shall relate only to the Class A(2010-B) Notes and no other Tranche of Notes issued by the
Issuer; 

 (7) “including” and words of similar import will be deemed to be followed by
“without limitation”; and 
 (8) for purposes of determining any amount or making any calculation hereunder, such
amount or calculation, (x) if specified to be as of the first day of any Due Period, shall (a) include any Notes issued during such Due Period as if such Notes had been outstanding on the first day of such Due Period and (b) give
effect to any payments, deposits or other allocations made on the Distribution Date related to the prior Due Period, and (y) if specified to be as of the close of business on the last day of any Due Period shall give effect to any payments,
deposits or other allocations made on the related Distribution Date. 
 “Agent” has the meaning set forth in
the Note Purchase Agreement. 
 “Class A(2010-B) Adverse Event” means the occurrence of any of the following:
(a) an Early Redemption Event with respect to the Class A(2010-B) Notes or (b) an Event of Default and acceleration of the Class A(2010-B) Notes; provided, however, that if the only such event to have occurred is an Excess
Spread Early Redemption Event for which an Excess Spread Early Redemption Cure has occurred, a Class A(2010-B) Adverse Event shall not be treated as continuing from and after the date of such cure. 

“Class A(2010-B) Note” means any Note, in the form set forth in Exhibit A hereto, designated therein as a Class
A(2010-B) Note and duly executed and authenticated in accordance with the Indenture. 
 “Class A(2010-B)
Noteholder” means a Person in whose name a Class A(2010-B) Note is registered in the Note Register. 
 “Class
A(2010-B) Termination Date” means the earliest to occur of (a) the Principal Payment Date on which the Outstanding Dollar Principal Amount of the Class A(2010-B) Notes is paid in full and the Note Purchase Commitment has been
permanently reduced to zero, (b) the Legal Maturity Date and (c) the date on which the Indenture is discharged and satisfied pursuant to Article VI thereof. 

“Class A(2010-B) Tranche Interest Allocation” for the Class A(2010-B) Notes for any Distribution Date means the Note
Interest for the Class A(2010-B) Notes. 
 “Class Expected Final Payment Date” with respect to Series 2009-SD
of the Master Trust has the meaning set forth in the Series 2009-SD Supplement. 
 “Existing Expected Maturity
Date” has the meaning set forth in the Note Purchase Agreement. 
 “Existing Legal Maturity Date” has
the meaning set forth in the Note Purchase Agreement. 
 “Existing Liquidation Commencement Date” has the
meaning set forth in the Note Purchase Agreement. 
  

 2 

 “Expected Maturity Date” means October 15, 2012 or, if such date is
extended pursuant to the Note Purchase Agreement, the Existing Expected Maturity Date. 
 “Expected Principal Payment
Date” means each Distribution Date for which the Targeted Principal Payment Amount is greater than zero, including (i) the Expected Maturity Date and (ii) any Interim Expected Maturity Date. 

“Increase Amount” means the amount of any increase in the Outstanding Dollar Principal Amount as specified in any Notice
of Increase delivered under Section 2.09. 
 “Increased Costs Amount” has the meaning set forth in the
Note Purchase Agreement. 
 “Indenture” means the Indenture dated as of July 26, 2007 between the Issuer
and the Indenture Trustee, as the same may be amended, supplemented, restated, amended and restated, replaced or otherwise modified from time to time. 

“Indenture Supplement” means the Indenture Supplement dated as of July 26, 2007, as amended by the Omnibus
Amendment dated as of July 2, 2009, for the DiscoverSeries Notes, by and between the Issuer and the Indenture Trustee, as the same may be amended, supplemented, restated, amended and restated, replaced or otherwise modified from time to time.

 “Initial Dollar Principal Amount” means (a) $0 plus (b) the sum of all Increase Amounts specified
in all Notices of Increase delivered under Section 2.09. 
 “Interest Accrual Period” means, with respect
to any Interest Payment Date, the period from and including the previous Interest Payment Date (or, in the case of the first Interest Payment Date for any Class A(2010-B) Note, from and including the applicable Issuance Date) to but excluding such
Interest Payment Date. 
 “Interest Payment Date” means the fifteenth day of each month commencing in June
2010, or if such fifteenth day is not a Business Day, the next succeeding Business Day. 
 “Interim Expected Maturity
Date” for any Increase Amount has the meaning specified in the applicable Notice of Increase delivered under Section 2.09; provided, that, in no event shall any Interim Expected Maturity Date be later than the Expected Maturity Date.

 “Interim Liquidation Commencement Date” means, for any Increase Amount, the Interim Liquidation Commencement
Date specified as such in the applicable Notice of Increase delivered under Section 2.09. 
 “Interim Liquidation
Period” for any Increase Amount and the related Interim Expected Maturity Date means, unless an Early Redemption Event or an Event of Default for the Class A(2010-B) Notes shall have occurred prior thereto, the period commencing on the
related Interim Liquidation Commencement Date and ending on the earlier to occur of (x) the payment in full of such Increase Amount or (y) the occurrence of an Early Redemption Event or an Event of Default for the Class A(2010-B) Notes;
provided, however, that (i) if an Excess Spread Early Redemption Cure has occurred with respect to any Excess Spread Early Redemption Event for the Class A(2010-B) Notes prior to the commencement of the Interim Liquidation Period
for 
  

 3 

 
such Increase Amount (and no other Early Redemption Event or Event of Default for the Class A(2010-B) Notes has occurred), the Interim Liquidation Period for such Increase Amount shall be
determined as if such Excess Spread Early Redemption Event had not occurred, and (ii) if the Interim Liquidation Period has terminated in accordance with clause (y) above, due solely to the occurrence of an Excess Spread Early Redemption
Event for which there has been a subsequent Excess Spread Early Redemption Cure (and no other Early Redemption Event or Event of Default has occurred), the Interim Liquidation Period for such Increase Amount shall resume and shall continue until the
earlier to occur of (x) the payment in full of such Increase Amount or (y) the occurrence of a subsequent Early Redemption Event or Event of Default. 

“Issuance Date” means May 20, 2010, with respect to all Class A(2010-B) Notes issued on the date hereof and, with
respect to any increase in the Outstanding Dollar Principal Amount pursuant to Section 2.09, any Issuance Date specified in the Notice of Increase delivered thereunder. 

“Legal Maturity Date” means April 15, 2015 or, if such date is extended pursuant to the Note Purchase Agreement,
the Existing Legal Maturity Date. 
 “Liquidation Commencement Date” means the Existing Liquidation
Commencement Date. 
 “Liquidation Period” for the Class A(2010-B) Notes that are scheduled to mature on the
Expected Maturity Date means, unless an Early Redemption Event or an Event of Default for the Class A(2010-B) Notes shall have occurred prior thereto, the period commencing on the Liquidation Commencement Date and ending on the earlier to occur of
(x) the payment in full of the Outstanding Dollar Principal Amount of the Class A(2010-B) Notes or (y) the occurrence of an Early Redemption Event or an Event of Default for the Class A(2010-B) Notes; provided, however, that
(i) if an Excess Spread Early Redemption Cure has occurred with respect to any Excess Spread Early Redemption Event for the Class A(2010-B) Notes prior to the commencement of the Liquidation Period (and no other Early Redemption Event or Event
of Default for these Class A(2010-B) Notes has occurred), the Liquidation Period shall be determined as if such Excess Spread Early Redemption Event had not occurred, and (ii) if the Liquidation Period has terminated in accordance with clause
(y) above, due solely to the occurrence of an Excess Spread Early Redemption Event for which there has been a subsequent Excess Spread Early Redemption Cure (and no other Early Redemption Event or Event of Default has occurred), the Liquidation
Period shall resume and shall continue until the earlier to occur of (x) the payment in full of the Outstanding Dollar Principal Amount of the Class A(2010-B) Notes or (y) the occurrence of a subsequent Early Redemption Event or Event of
Default. 
 “Note Interest” for these Class A(2010-B) Notes has the meaning set forth in the Note Purchase
Agreement. 
 “Note Interest Rate” for these Class A(2010-B) Notes has the meaning set forth in the Note
Purchase Agreement; for the avoidance of doubt the Note Interest Rate shall be calculated in accordance with the calculation basis set forth in the Note Purchase Agreement. 

 

 4 

 “Notice of Increase” has the meaning set forth in Section 2.09.

 “Principal Payment Date” means, for the Class A(2010-B) Notes, each Expected Principal Payment Date, or upon
the acceleration of such Notes following an Event of Default or upon the occurrence and during the continuance of an Early Redemption Event (unless all such events have been cured), each Distribution Date and the Legal Maturity Date, or in the event
of a cleanup call, the date of redemption in accordance with Section 1202 of the Indenture. 
 “Required Daily
Deposit Target Finance Charge Amount” means, for any day in a Due Period, an amount equal to the Class A(2010-B) Tranche Interest Allocation for the related Distribution Date; provided, however, that for purposes of determining the
Required Daily Deposit Target Finance Charge Amount on any day on which the Class A(2010-B) Tranche Interest Allocation cannot be determined because the Note Interest Rate for the applicable Interest Accrual Period has not yet been notified to the
Calculation Agent and the Indenture Trustee in accordance with the Note Purchase Agreement, the Required Daily Deposit Target Finance Charge Amount shall be the Class A(2010-B) Tranche Interest Allocation determined based on a pro forma calculation
made on the assumption that the Note Interest Rate will be equal to the sum of (i) the Note Interest Rate, excluding any applicable margin, for the prior Interest Accrual Period and applicable to the Interest Payment Date occurring in such Due
Period, multiplied by 1.25 and (ii) any applicable margin; provided, further, that for purposes of determining the Required Daily Deposit Target Finance Charge Amount for any day in the Due Period preceding the first
Interest Payment Date on which the Outstanding Dollar Principal Amount of the Class A(2010-B) Notes is greater than zero, if the Class A(2010-B) Tranche Interest Allocation cannot be determined because the Note Interest Rate for such first Interest
Accrual Period has not yet been notified to the Calculation Agent and the Indenture Trustee in accordance with the Note Purchase Agreement, a rate equal to the rate provided by the Agent, based on the Agent’s good faith estimate of the
anticipated Note Interest Rate for such first Interest Accrual Period, to the Indenture Trustee and Calculation Agent on the date of effectiveness of such first increase in the Outstanding Dollar Principal Amount of the Class A(2010-B) Notes shall
be used in lieu of the Note Interest Rate. 
 “Required Daily Deposit Target Principal Amount” means, for any
day in a Due Period, (i) if such Due Period is in the Liquidation Period or any Interim Liquidation Period, the Targeted Principal Payment Amount for the related Distribution Date, (ii) if such day is on or after the occurrence and during
the continuance of a Class A(2010-B) Adverse Event, the Nominal Liquidation Amount of the Class A(2010-B) Notes, and (iii) in all other circumstances, zero. 

“Required Subordinated Amount of Class B Notes” means, for the Class A(2010-B) Notes for any date of determination, an
amount equal to the product of 
 (a) the Required Subordinated Percentage of Class B Notes for such Class A(2010-B) Notes on
such date of determination and 
 (b) the Nominal Liquidation Amount of such Class A(2010-B) Notes on such date of
determination; 
  

 5 

 provided however, that for any date of determination on or after the occurrence and during the
continuation of a Class A(2010-B) Adverse Event, the Required Subordinated Amount of Class B Notes for Class A(2010-B) Notes will be the greater of 

(x) the amount determined above for such date of determination and 

(y) the amount determined above for the date immediately prior to the date on which such Class A(2010-B) Adverse Event shall have
occurred. 
 “Required Subordinated Amount of Class C Notes” means, for the Class A(2010-B) Notes for any date
of determination, an amount equal to the product of 
 (a) the Required Subordinated Percentage of Class C Notes for such Class
A(2010-B) Notes on such date of determination and 
 (b) the Nominal Liquidation Amount of such Class A(2010-B) Notes on such
date of determination; 
 provided, however, that for any date of determination on or after the occurrence and during the
continuation of a Class A(2010-B) Adverse Event, the Required Subordinated Amount of Class C Notes for the Class A(2010-B) Notes will be the greater of 

(x) the amount determined above for such date of determination and 

(y) the amount determined above for the date immediately prior to the date on which such Class A(2010-B) Adverse Event shall have
occurred. 
 “Required Subordinated Amount of Class D Notes” means, for the Class A(2010-B) Notes for any date
of determination, an amount equal to the product of 
 (a) the Required Subordinated Percentage of Class D Notes for such Class
A(2010-B) Notes on such date of determination and 
 (b) the Nominal Liquidation Amount of such Class A(2010-B) Notes on such
date of determination; 
 provided, however, that for any date of determination on or after the occurrence and during the continuation of
a Class A(2010-B) Adverse Event, the Required Subordinated Amount of Class D Notes for the Class A(2010-B) Notes will be the greater of 

(x) the amount determined above for such date of determination and 

(y) the amount determined above for the date immediately prior to the date on which the Class A(2010-B) Adverse Event shall have
occurred. 
 “Required Subordinated Percentage of Class B Notes” means, for the Class A(2010-B) Notes,
7.284768%, subject to adjustment in accordance with Section 2.02; provided, however, that prior to the Class Expected Final Payment Date for Series 2009-SD, the Required 

 

 6 

 
Subordinated Percentage of Class B Notes for the Class A(2010-B) Notes will be 7.142857%, subject to adjustment in accordance with Section 2.02. 

“Required Subordinated Percentage of Class C Notes” means, for the Class A(2010-B) Notes, 9.271523%, subject to
adjustment in accordance with Section 2.02; provided, however, that prior to the Class Expected Final Payment Date for Series 2009-SD, the Required Subordinated Percentage of Class C Notes for the Class A(2010-B) Notes will be 9.090909%,
subject to adjustment in accordance with Section 2.02. 
 “Required Subordinated Percentage of Class D
Notes” means, for the Class A(2010-B) Notes, 15.894040%, subject to adjustment in accordance with Section 2.02; provided, however, that prior to the Class Expected Final Payment Date for Series 2009-SD, the Required Subordinated
Percentage of Class D Notes for the Class A(2010-B) Notes will be 13.636364%, subject to adjustment in accordance with Section 2.02. 

“Series 2009-SD Supplement” means the Series 2009-SD Series Supplement to the Pooling and Servicing Agreement dated as
of September 23, 2009, by and between Discover Bank as Master Servicer, Servicer and Seller and U.S. Bank National Association as Trustee, as the same may be amended, supplemented, restated, amended and restated, replaced or otherwise modified
from time to time. 
 “Stated Principal Amount” means (a) $0, plus (b) the sum of all Increase
Amounts specified in all Notices of Increase delivered under Section 2.09, minus (c) the aggregate amount of principal paid to the Class A(2010-B) Noteholders pursuant to Section 2.04. 

“Targeted Principal Payment Amount” means, for any Distribution Date, the sum of: 

(i) if such Distribution Date is in the Liquidation Period, any Increase Amount that is scheduled to mature on the Expected Maturity
Date; and 
 (ii) if such Distribution Date is in any Interim Liquidation Period, the applicable Increase Amount maturing on
such Distribution Date. 
 Section 1.02. Representations and Warranties of Issuer. The Issuer represents and warrants that:

 (a) the Issuer has been duly formed and is validly existing as a statutory trust in good standing under the laws of the State
of Delaware, and has full power and authority to execute and deliver this Terms Document and to perform the terms and provisions hereof; 

(b) the execution, delivery and performance of this Terms Document by the Issuer have been duly authorized by all necessary corporate and
statutory trust proceedings of any Beneficiary and the Owner Trustee, do not require any approval or consent of any governmental agency or authority, and do not and will not conflict with any material provision of the Certificate of Trust or the
Trust Agreement of the Issuer; 
 (c) this Terms Document is the valid, binding and enforceable obligation of the Issuer, except
as the same may be limited by receivership, insolvency, reorganization, 
  

 7 

 
moratorium or other laws relating to the enforcement of creditors’ rights generally or by general equity principles; 

(d) to the best of the Issuer’s knowledge, this Terms Document will not conflict with any law or governmental regulation or court
decree applicable to it; 
 (e) the Issuer is not required to be registered under the Investment Company Act; 

(f) all information heretofore furnished by the Issuer in writing to the Indenture Trustee for purposes of or in connection with this
Terms Document or any transaction contemplated hereby is, and all such information hereafter furnished by the Issuer in writing to the Indenture Trustee will be, true and accurate in every material respect or based on reasonable estimates on the
date as of which such information is stated or certified; and 
 (g) to the best knowledge of the Issuer, there are no
proceedings or investigations pending against the Issuer before any court, regulatory body, administrative agency, or other tribunal or governmental instrumentality having jurisdiction over the Issuer (A) asserting the invalidity of this Terms
Document, (B) seeking to prevent the consummation of any of the transactions contemplated by this Terms Document or (C) seeking any determination or ruling which in the Issuer’s judgment would materially and adversely affect the
performance by the Issuer of its obligations under this Terms Document or the validity or enforceability of this Terms Document. 

Section 1.03. Representations and Warranties of Indenture Trustee. The Indenture Trustee represents and warrants and any successor trustee
shall represent and warrant that: 
 (a) The Indenture Trustee is organized, existing and in good standing under the laws of the
United States of America; 
 (b) The Indenture Trustee has full power, authority and right to execute, deliver and perform this
Indenture, and has taken all necessary action to authorize the execution, delivery and performance by it of this Terms Document; and 

(c) This Terms Document has been duly executed and delivered by the Indenture Trustee. 

Section 1.04. Limitations on Liability. 

(a) It is expressly understood and agreed by the parties hereto that (i) this Terms Document is executed and delivered by the Owner
Trustee not individually or personally but solely as Owner Trustee under the Trust Agreement, in the exercise of the powers and authority conferred and vested in it, (ii) each of the representations, undertakings and agreements herein made on
the part of the Issuer is made and intended not as a personal representation, undertaking or agreement by the Owner Trustee but is made and intended for the purpose of binding only the Issuer, (iii) nothing herein contained will be construed as
creating any liability on the Owner Trustee individually or personally, to perform any covenant of the Issuer either expressed or implied herein, all such liability, if any, being expressly waived by the parties to this Terms Document and by any
Person claiming by, through or under them and (iv) under no 
  

 8 

 
circumstances will the Owner Trustee be personally liable for the payment of any indebtedness or expenses of the Issuer or be liable for the breach or failure of any obligation, representation,
warranty or covenant made or undertaken by the Issuer under this Terms Document or any related documents. 
 (b) None of the
Indenture Trustee, the Owner Trustee, the Calculation Agent, any Beneficiary, the Depositor, any Master Servicer or any Servicer or any of their respective officers, directors, employees, incorporators or agents will have any liability with respect
to this Terms Document, and recourse may be had solely to the Collateral pledged to secure these Class A(2010-B) Notes under the Indenture, the Indenture Supplement and this Terms Document (except as expressly provided in Sections 9.01 and 9.02 of
the Note Purchase Agreement). 
 Section 1.05. Governing Law. THIS TERMS DOCUMENT WILL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED
BY THE LAWS OF THE STATE OF NEW YORK, INCLUDING SECTION 5-1401 OF THE GENERAL OBLIGATION LAW, WITHOUT REFERENCE TO ANY CONFLICT OF LAW PROVISIONS THAT WOULD RESULT IN THE APPLICATION OF THE LAWS OF ANY OTHER STATE. 

Section 1.06. Counterparts. This Terms Document may be executed in any number of counterparts, each of which when so executed will be deemed
to be an original, but all such counterparts will together constitute but one and the same instrument. 
 Section 1.07. Ratification of
Indenture and Indenture Supplement. As supplemented by this Terms Document, each of the Indenture and the Indenture Supplement is in all respects ratified and confirmed and the Indenture as supplemented by the Indenture Supplement and this Terms
Document shall be read, taken and construed as one and the same instrument. 
 ARTICLE II 

The Class A(2010-B) Notes 

Section 2.01. Creation and Designation. There is hereby created a Tranche of Class A Notes to be issued pursuant to the Indenture, the
Indenture Supplement and the Note Purchase Agreement to be known as the “DiscoverSeries Class A(2010-B) Notes.” 

Section 2.02. Adjustments to Required Subordinated Percentages and Amount. 

(a) On any date, the Issuer may, at the direction of the Beneficiary, change the Required Subordinated Percentage of Class B Notes, the
Required Subordinated Percentage of Class C Notes or the Required Subordinated Percentage of Class D Notes; provided that the Issuer has received written confirmation from each applicable Note Rating Agency that the change in such percentage
will not result in a Ratings Effect for any Tranche of Outstanding DiscoverSeries Notes; and provided further, that (i) if any Note Rating Agency has downgraded any Tranche of Class A Notes it rated “AAA” or the equivalent
at initial issuance and has not restored such “AAA” rating, none of the Required Subordinated Percentage of Class B Notes, the Required Subordinated Percentage of Class C Notes and the Required Subordinated Percentage of Class D Notes, in
each case for the Class A(2010-B) Notes, shall be reduced without the written consent of the Agent and (ii) if there is an increase in the Required 

 

 9 

 
Subordinated Percentage of Class B Notes, the Required Subordinated Percentage of Class C Notes or the Required Subordinated Percentage of Class D Notes, in each case for any Tranche of
Class A Notes that is rated “AAA” or the equivalent by a Note Rating Agency, then there shall be a commensurate increase in the Required Subordinated Percentage of Class B Notes, the Required Subordinated Percentage of Class C
Notes and the Required Subordinated Percentage of Class D Notes, as applicable, in each case for the Class A(2010-B) Notes. 

(b) On any date, the Issuer may, at the direction of the Beneficiary, replace all or a portion of the Required Subordinated Amount of
Class B Notes, the Required Subordinated Amount of Class C Notes or the Required Subordinated Amount of Class D Notes, in each case for the Class A(2010-B) Notes with a different form of credit enhancement (including, without limitation, a cash
collateral account, a letter of credit, a reserve account, a surety bond, an insurance policy or a collateral interest, or any combination thereof) and may add such definitions and other terms and make such additional amendments to this Terms
Document as shall be necessary for such replacement; provided that the Issuer has received written confirmation from each applicable Note Rating Agency that such replacement, such addition and such other amendments will not result in a
Ratings Effect for any Tranche of Outstanding DiscoverSeries Notes; and provided further, that (i) if any Note Rating Agency has downgraded any Tranche of Class A Notes it rated “AAA” or the equivalent at initial issuance
and has not restored such “AAA” rating, none of the Required Subordinated Amount of Class B Notes, the Required Subordinated Amount of Class C Notes or the Required Subordinated Amount of Class D Notes, in each case for the Class A(2010-B)
Notes, shall be replaced with a different form of credit enhancement without the written consent of the Agent and (ii) if any Tranche of Class A Notes that is rated “AAA” or the equivalent by a Note Rating Agency is outstanding
and there is a replacement of all or a portion of the Required Subordinated Amount of Class B Notes, the Required Subordinated Amount of Class C Notes or the Required Subordinated Amount of Class D Notes with a different form of credit enhancement,
in each case for any such Tranche of Class A Notes, then there shall be a commensurate replacement of all or a portion of the Required Subordinated Amount of Class B Notes, the Required Subordinated Amount of Class C Notes or the Required
Subordinated Amount of Class D Notes, in each case for the Class A(2010-B) Notes. 
 Section 2.03. Interest Payment. For each
Interest Payment Date, the amount of interest due with respect to the Class A(2010-B) Notes shall be the Note Interest for the Class A(2010-B) Notes, or such other amount based on any alternative rate then in effect under the Note Purchase
Agreement, in each case as determined pursuant to the Note Purchase Agreement; plus, without duplication, any Class A Tranche Interest Allocation Shortfall for such Class A(2010-B) Notes for the immediately preceding Distribution Date,
together with interest thereon at the Note Interest Rate in effect with respect to such related Interest Accrual Period, calculated on the basis of the actual number of days in the related Interest Accrual Period and a 360-day year. 

Section 2.04. Payments of Interest and Principal; Payments of Increased Costs Amount. 

(a) The Issuer will cause interest to be paid on each Interest Payment Date and principal to be paid on each Principal Payment Date on
which the Targeted Principal Payment Amount is greater than zero, with the last such principal payment to be made on or prior to the Expected Maturity Date; provided, however, that it shall not be an Event of Default if scheduled

  

 10 

 
principal is not paid in full on or prior to any Interim Expected Maturity Date or the Expected Maturity Date unless funds for such payment have been allocated in accordance with
Section 3.01 of the Indenture Supplement; and provided, further, that if a Class A(2010-B) Adverse Event has occurred and is continuing, principal will instead be payable in monthly installments on each Principal Payment Date for
the Class A(2010-B) Notes in an amount equal to the lesser of the Nominal Liquidation Amount of the Class A(2010-B) Notes and the amount allocated for such payment in accordance with Section 3.01 of the Indenture Supplement, with such payment
to be made in accordance with Section 3.05 of the Indenture Supplement. All payments of interest and principal on the Class A(2010-B) Notes shall be made as set forth in Section 1102 of the Indenture. 

(b) The right of the Class A(2010-B) Noteholders to receive payments from the Issuer will terminate on the Class A(2010-B) Termination
Date. 
 (c) All payments of principal, interest or other amounts to the Class A(2010-B) Noteholders will be made pro
rata based on the Outstanding Dollar Principal Amount of their Class A(2010-B) Notes. 
 (d) For the avoidance of doubt, the
“Targeted Principal Payment Amount” shall be the amount scheduled to be paid on each Principal Payment Date as specified in this Terms Document for the Class A(2010-B) Notes for purposes of clause (a)(x)(i) of the definition of
“Targeted Principal Deposit” in the Indenture Supplement. 
 (e) The Increased Costs Amount, if applicable, shall be
paid in accordance with the Note Purchase Agreement from the Series Finance Charge Amounts remaining after step (54) (Targeted Deposit to Class D Reserve Subaccounts from Series Finance Charge Amounts) of Section 3.01 of the Indenture
Supplement, in accordance with step (55) (Other Deposits and Payments from Series Finance Charge Amounts) of Section 3.01 of the Indenture Supplement. 

(e) For the avoidance of doubt, the phrase “the three preceding Distribution Dates” in Section 4.01(a)(i)(x) of the
Indenture Supplement is intended to mean, and shall be interpreted as meaning, the three consecutive Distribution Dates ending on and including the Distribution Date as to which the applicable determination is made. 

(f) The date referenced in clause (iv) of the definition of “Principal Allocation Amount” in the Indenture shall be the
Liquidation Commencement Date. 
 Section 2.05. [Reserved] 

Section 2.06. Form of Class A(2010-B) Notes; Legend; Transfer Restriction. 

(a) The Class A(2010-B) Notes shall be Registered Notes delivered in definitive form and shall be initially registered in the name of the
Agent on behalf of the Owners. The Class A(2010-B) Notes will be issued in minimum denominations of $250,000 and integral multiples of $1,000 in excess of that amount. 

(b) Each Class A(2010-B) Note issued pursuant to this Terms Document and the Note Purchase Agreement shall, until such time as the laws
of any jurisdiction in which they are 
  

 11 

 
offered or sold no longer restrict the transfer or sale thereof, bear a legend in substantially the following form: 

THIS NOTE (OR ITS PREDECESSOR) WAS ORIGINALLY ISSUED IN A TRANSACTION EXEMPT FROM REGISTRATION UNDER SECTION 5 OF THE SECURITIES ACT OF
1933, AS AMENDED (THE “SECURITIES ACT”), AND THIS NOTE MAY NOT BE OFFERED, SOLD OR OTHERWISE TRANSFERRED IN THE ABSENCE OF SUCH REGISTRATION OR AN APPLICABLE EXEMPTION THEREFROM. EACH PURCHASER OF THIS NOTE IS HEREBY NOTIFIED THAT THE
SELLER OF THIS NOTE MAY BE RELYING ON THE EXEMPTION FROM THE PROVISIONS OF SECTION 5 OF THE SECURITIES ACT PROVIDED BY RULE 144A. THE HOLDER OF THIS NOTE AGREES FOR THE BENEFIT OF DISCOVER CARD EXECUTION NOTE TRUST AND DISCOVER BANK THAT
(A) THIS NOTE MAY BE RESOLD, PLEDGED OR OTHERWISE TRANSFERRED ONLY (1) TO A PERSON WHO THE SELLER REASONABLY BELIEVES IS A “QUALIFIED INSTITUTIONAL BUYER” (AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT) IN COMPLIANCE WITH RULE
144A UNDER THE SECURITIES ACT, OR (2) TO DISCOVER BANK OR ITS AFFILIATES, IN EACH CASE, IN ACCORDANCE WITH ANY APPLICABLE SECURITIES LAW OF ANY STATE OF THE UNITED STATES OR ANY OTHER APPLICABLE JURISDICTION AND (B) THE HOLDER WILL, AND
EACH SUBSEQUENT HOLDER IS REQUIRED TO, NOTIFY ANY SUBSEQUENT PURCHASER FROM IT OF THE RESALE RESTRICTIONS SET FORTH IN (A) ABOVE. 

(c) No Note issued under this Terms Document or beneficial interest therein shall be transferred except in accordance with the transfer
restrictions described in the legend set forth in clause (b) above. 
 Section 2.07. Delivery and Payment for the Class A(2010-B)
Notes. The Issuer shall execute and deliver the Class A(2010-B) Notes to the Indenture Trustee for authentication, and the Indenture Trustee shall deliver the Class A(2010-B) Notes when authenticated, each in accordance with Sections 203 and 303
of the Indenture and the Note Purchase Agreement. 
 Section 2.08. Additional Early Redemption Events. To the extent set forth in
Section 4.01(b) of the Indenture Supplement and pursuant thereto, the following shall be additional Early Redemption Events relating to the Class A(2010-B) Notes: (a) failure on the part of the Issuer to make any interest payment with
respect to the Class A(2010-B) Notes required by the terms of the Note Purchase Agreement, the Indenture, the Indenture Supplement or this Terms Document on or before the date occurring thirty five (35) days after the date such payment is
required to be made herein or therein; and (b) a default in the performance, or breach, of any covenant or warranty of the Issuer in the Note Purchase Agreement, and continuance of such default or breach for a period of sixty (60) days
after there has been given, by written notice, to the Issuer by the Indenture Trustee or to the Issuer and the Indenture Trustee by the Agent, a written notice specifying such default or breach and requesting it to be remedied, and if as a result of
such 
  

 12 

 
default, the interests of the Class A(2010-B) Noteholders are materially and adversely affected and continue to be materially and adversely affected during the sixty (60) day period.

 Section 2.09. Increases in the Outstanding Dollar Principal Amount. Subject to clauses (ii), (iii), (iv) and (v) of
Sections 2.02 and Section 2.03 of the Indenture Supplement, the Issuer may increase the Outstanding Dollar Principal Amount of the Class A(2010-B) Notes, so long as the following conditions precedent are satisfied: 

(a) the Issuer shall have given the Agent and the Indenture Trustee written notice of such increase in the Outstanding Dollar Principal
Amount of the Class A(2010-B) Notes (the “Notice of Increase”) at least two (2) Business Days in advance of the Issuance Date thereof, which notice shall include: 

 

	 	(i)	the Issuance Date of such increase in the Outstanding Dollar Principal Amount of the Class A(2010-B) Notes; 

 

	 	(ii)	the amount of such increase in the Outstanding Dollar Principal Amount of the Class A(2010-B) Notes and the resulting Stated Principal Amount of the Class A(2010-B)
Notes; 

  

	 	(iii)	the first Interest Payment Date on which interest will be paid on such increase in the Outstanding Dollar Principal Amount of the Class A(2010-B) Notes;

  

	 	(iv)	the Interim Expected Maturity Date (which date shall be a Distribution Date) and the Interim Liquidation Commencement Date (or otherwise confirm that such Increase
Amount is scheduled to mature on the Expected Maturity Date) with respect to the Increase Amount of the Outstanding Dollar Principal Amount of the Class A(2010-B) Notes; and 

 

	 	(v)	any other terms that the Issuer may set forth in such notice of increase to clarify the rights of Holders of the Class A(2010-B) Notes or the effect of such increase on
any calculations to be made with respect to the Class A(2010-B) Notes, Class A, or the Issuer; and 

 (b) no
Class A(2010-B) Adverse Event has occurred and is continuing; 
 (c) such increase will not cause the Outstanding Dollar
Principal Amount of the Class A(2010-B) Notes to exceed the Note Purchase Commitment; 
 (d) (i) no Note Interest or other
amount due and payable to any Class A(2010-B) Noteholder prior to the Issuance Date for such increase remains outstanding and (ii) as of the most recent Distribution Date preceding such Issuance Date, there is no un-reimbursed Nominal
Liquidation Amount Deficit with respect to the Class A(2010-B) Notes; 
  

 13 

 (e) all of the representations and warranties of the Issuer, the Seller, the Master Servicer
and the Servicer, as applicable, set forth in the Indenture, Indenture Supplement, the Pooling and Servicing Agreement, the Series 2007-CC Supplement and the Note Purchase Agreement that do not expressly speak to an earlier date shall be true and
correct in all material respects as though made on and as of such Issuance Date after giving effect thereto; and 
 (f) if the
FDIC adopts any material change to the securitization safe harbor set forth at 12 CFR 360.6 after the date hereof (other than an extension of the interim safe harbor set forth therein beyond September 30, 2010), the Issuer shall have provided
the Agent with a legal opinion, in form and substance reasonably satisfactory to the Agent, relating to the legal isolation of the Receivables after giving effect to such change. 

All such terms set forth in the Notice of Increase shall be incorporated into and form a part of this Terms Document on and after the effective date of
such increase in the Outstanding Dollar Principal Amount of the Class A(2010-B) Notes. The Expected Maturity Date, Expected Principal Payment Date, Liquidation Commencement Date, Liquidation Period and Legal Maturity Date, in each case as in effect
as of the Issuance Date of such increase in the Outstanding Dollar Principal Amount of the Class A(2010-B) Notes, shall be applicable to such increased amounts unless otherwise provided in the applicable Notice of Increase. The Issuer shall not have
to satisfy the conditions set forth in Section 310 of the Indenture in connection with an increase in the Outstanding Dollar Principal Amount of the Class A(2010-B) Notes so long as such conditions were satisfied or waived in connection with
the initial issuance of Class A(2010-B) Notes. Any such increase shall be deemed to have occurred under Section 310 of the Indenture and this Section 2.09 for purposes of the Indenture, the Indenture Supplement and this Terms Document.

 Section 2.10. Designation of Additional Amounts to be included in the Excess Spread Amount for the DiscoverSeries
Notes. At any time that any outstanding Series of certificates issued by the Master Trust provides that the Series Principal Collections allocated to such Series will be deposited into the Group Finance Charge Collections Reallocation Account
for the Master Trust to the extent necessary for application to cover shortfalls for other Series issued by the Master Trust, an amount equal to (x) all Series Principal Collections allocated to such Series, multiplied by (y) a
fraction, the numerator of which is the sum of the Nominal Liquidation Amounts for each outstanding Tranche of the DiscoverSeries Notes (including the Class A(2010-B) Notes) and the denominator of which is the Aggregate Investor Interest for the
Master Trust minus the sum of the Series Investor Interests for all such Series that provide that the Series Principal Collections allocated to such Series will be so deposited, is hereby designated to be included in the Excess Spread Amount
and shall be treated as Series Finance Charge Amounts for the DiscoverSeries. 
 [Remainder of page intentionally blank;
signature page follows] 
  

 14 

 IN WITNESS WHEREOF, the parties hereto have caused this Terms Document to be duly executed, all as of the
day and year first above written. 
  

					
	 DISCOVER CARD EXECUTION NOTE TRUST, as Issuer

		
	By:	 	 Wilmington Trust Company, not in its individual capacity but solely as Owner Trustee

		
	By:	 	 /s/ Jennifer A. Luce

		 	Name:	 	Jennifer A. Luce
		 	Title:	 	Assistant Vice President
	
	 U.S. BANK NATIONAL ASSOCIATION, as Indenture Trustee

		
	By:	 	 /s/ Patricia M. Child

		 	Name:	 	Patricia M. Child
		 	Title:	 	Vice President

  

 [Signature page to the Terms Document Class A(2010-B)]

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