Document:

<PAGE>   1

                                                                    EXHIBIT 4.16

                                CREDIT AGREEMENT

                                      among

                                PULTE CORPORATION

                                  as Borrower,

                 THE MATERIAL SUBSIDIARIES OF PULTE CORPORATION

                                 as Guarantors,

                         THE LENDERS IDENTIFIED HEREIN,

                             BANK OF AMERICA, N.A.,

                            as Administrative Agent,

                                  BANK ONE, NA,

                              as Syndication Agent,

                                       and

                                 COMERICA BANK,

                                   as Co-Agent

                           DATED AS OF AUGUST 31, 2000

                         BANC OF AMERICA SECURITIES LLC,

                  as Sole Lead Arranger and Sole Book Manager,

<PAGE>   2

                                TABLE OF CONTENTS

<TABLE>
<S>      <C>                                                                                                     <C>
SECTION 1  DEFINITIONS AND ACCOUNTING TERMS.......................................................................1
           --------------------------------

   1.1   DEFINITIONS..............................................................................................1
         -----------
   1.2   COMPUTATION OF TIME PERIODS AND OTHER DEFINITIONAL PROVISIONS...........................................20
         -------------------------------------------------------------
   1.3   ACCOUNTING TERMS........................................................................................20
         ----------------
   1.4   TIME....................................................................................................21
         ----

SECTION 2  CREDIT FACILITIES.....................................................................................21
           -----------------

   2.1   REVOLVING LOANS.........................................................................................21
         ---------------
   2.2   SWINGLINE LOANS SUBFACILITY.............................................................................24
         ---------------------------
   2.3   CONTINUATIONS AND CONVERSIONS...........................................................................26
         -----------------------------
   2.4   MINIMUM AMOUNTS.........................................................................................26
         ---------------
   2.5   EXTENSION OF MATURITY DATE..............................................................................26
         --------------------------

SECTION 3  GENERAL PROVISIONS APPLICABLE TO LOANS................................................................28
           --------------------------------------

   3.1   INTEREST................................................................................................28
         --------
   3.2   PLACE AND MANNER OF PAYMENTS............................................................................29
         ----------------------------
   3.3   PREPAYMENTS.............................................................................................29
         -----------
   3.4   FEES....................................................................................................30
         ----
   3.5   PAYMENT IN FULL AT MATURITY.............................................................................31
         ---------------------------
   3.6   COMPUTATIONS OF INTEREST AND FEES.......................................................................31
         ---------------------------------
   3.7   PRO RATA TREATMENT......................................................................................32
         ------------------
   3.8   SHARING OF PAYMENTS.....................................................................................33
         -------------------
   3.9   CAPITAL ADEQUACY........................................................................................33
         ----------------
   3.10     INABILITY TO DETERMINE INTEREST RATE.................................................................34
            ------------------------------------
   3.11     ILLEGALITY...........................................................................................34
            ----------
   3.12     REQUIREMENTS OF LAW..................................................................................35
            -------------------
   3.13     TAXES................................................................................................36
            -----
   3.14     COMPENSATION.........................................................................................38
            ------------
   3.15     SUBSTITUTION OF LENDER...............................................................................39
            ----------------------
   3.16     EVIDENCE OF DEBT.....................................................................................39
            ----------------

SECTION 4  GUARANTY..............................................................................................40
           --------

   4.1   GUARANTY OF PAYMENT.....................................................................................40
         -------------------
   4.2   OBLIGATIONS UNCONDITIONAL...............................................................................40
         -------------------------
   4.3   MODIFICATIONS...........................................................................................41
         -------------
   4.4   WAIVER OF RIGHTS........................................................................................41
         ----------------
   4.5   REINSTATEMENT...........................................................................................41
         -------------
   4.6   REMEDIES................................................................................................42
         --------
   4.7   LIMITATION OF GUARANTY..................................................................................42
         ----------------------
   4.8   RIGHTS OF CONTRIBUTION..................................................................................42
         ----------------------

SECTION 5  CONDITIONS PRECEDENT..................................................................................43
           --------------------

   5.1   CLOSING CONDITIONS......................................................................................43
         ------------------
   5.2   CONDITIONS TO ALL EXTENSIONS OF CREDIT..................................................................47
         --------------------------------------

SECTION 6  REPRESENTATIONS AND WARRANTIES........................................................................47
           ------------------------------

   6.1   FINANCIAL CONDITION.....................................................................................47
         -------------------
   6.2   NO MATERIAL CHANGE......................................................................................48
         ------------------
   6.3   ORGANIZATION AND GOOD STANDING..........................................................................48
         ------------------------------
   6.4   DUE AUTHORIZATION.......................................................................................48
         -----------------
   6.5   NO CONFLICTS............................................................................................48
         ------------
</TABLE>

<PAGE>   3

<TABLE>
<S>      <C>                                                                                                     <C>
   6.6   CONSENTS................................................................................................49
         --------
   6.7   ENFORCEABLE OBLIGATIONS.................................................................................49
         -----------------------
   6.8   NO DEFAULT..............................................................................................49
         ----------
   6.9   LIENS...................................................................................................49
         -----
   6.10     INDEBTEDNESS.........................................................................................49
            ------------
   6.11     LITIGATION...........................................................................................50
            ----------
   6.12     TAXES................................................................................................50
            -----
   6.13     COMPLIANCE WITH LAW..................................................................................50
            -------------------
   6.14     ERISA................................................................................................50
            -----
   6.15     SUBSIDIARIES.........................................................................................51
            ------------
   6.16     USE OF PROCEEDS......................................................................................51
            ---------------
   6.17     GOVERNMENT REGULATION................................................................................52
            ---------------------
   6.18     ENVIRONMENTAL MATTERS................................................................................52
            ---------------------
   6.19     INTELLECTUAL PROPERTY................................................................................53
            ---------------------
   6.20     SOLVENCY.............................................................................................54
            --------
   6.21     INVESTMENTS..........................................................................................54
            -----------
   6.22     DISCLOSURE...........................................................................................54
            ----------
   6.23     LICENSES, ETC........................................................................................54
            --------------
   6.24     BURDENSOME RESTRICTIONS..............................................................................54
            -----------------------
   6.25     LABOR CONTRACTS AND DISPUTES.........................................................................54
            ----------------------------
   6.26     BROKER'S FEES........................................................................................55
            -------------

SECTION 7  AFFIRMATIVE COVENANTS.................................................................................55
           ---------------------

   7.1   INFORMATION COVENANTS...................................................................................55
         ---------------------
   7.2   FINANCIAL COVENANTS.....................................................................................58
         -------------------
   7.3   PRESERVATION OF EXISTENCE AND FRANCHISES................................................................59
         ----------------------------------------
   7.4   BOOKS AND RECORDS.......................................................................................59
         -----------------
   7.5   COMPLIANCE WITH LAW.....................................................................................59
         -------------------
   7.6   PAYMENT OF TAXES AND OTHER INDEBTEDNESS.................................................................59
         ---------------------------------------
   7.7   INSURANCE...............................................................................................59
         ---------
   7.8   MAINTENANCE OF PROPERTY.................................................................................60
         -----------------------
   7.9   PERFORMANCE OF OBLIGATIONS..............................................................................60
         --------------------------
   7.10     USE OF PROCEEDS......................................................................................60
            ---------------
   7.11     AUDITS/INSPECTIONS...................................................................................60
            ------------------
   7.12     ADDITIONAL CREDIT PARTIES............................................................................60
            -------------------------

SECTION 8  NEGATIVE COVENANTS....................................................................................61
           ------------------

   8.1   INDEBTEDNESS............................................................................................61
         ------------
   8.2   LIENS...................................................................................................62
         -----
   8.3   NATURE OF BUSINESS......................................................................................62
         ------------------
   8.4   CONSOLIDATION AND MERGER................................................................................62
         ------------------------
   8.5   SALE OR LEASE OF ASSETS.................................................................................62
         -----------------------
   8.6   SALE AND LEASEBACK......................................................................................63
         ------------------
   8.7   ADVANCES, INVESTMENTS AND LOANS.........................................................................64
         -------------------------------
   8.8   RESTRICTED PAYMENTS.....................................................................................64
         -------------------
   8.9   TRANSACTIONS WITH AFFILIATES............................................................................64
         ----------------------------
   8.10     FISCAL YEAR; ORGANIZATIONAL DOCUMENTS................................................................64
            -------------------------------------
   8.11     NO LIMITATIONS.......................................................................................64
            --------------
   8.12     NO OTHER NEGATIVE PLEDGES............................................................................64
            -------------------------
   8.13     OTHER INDEBTEDNESS...................................................................................65
            ------------------

SECTION 9  EVENTS OF DEFAULT.....................................................................................65
           -----------------

   9.1   EVENTS OF DEFAULT.......................................................................................65
         -----------------
   9.2   ACCELERATION; REMEDIES..................................................................................68
         ----------------------
   9.3   ALLOCATION OF PAYMENTS AFTER EVENT OF DEFAULT...........................................................69
         ---------------------------------------------
</TABLE>

                                       ii
<PAGE>   4

<TABLE>
<S>         <C>                                                                                                  <C>
SECTION 10  AGENCY PROVISIONS....................................................................................69
            -----------------

   10.1     APPOINTMENT..........................................................................................69
            -----------
   10.2     DELEGATION OF DUTIES.................................................................................70
            --------------------
   10.3     EXCULPATORY PROVISIONS...............................................................................70
            ----------------------
   10.4     RELIANCE ON COMMUNICATIONS...........................................................................71
            --------------------------
   10.5     NOTICE OF DEFAULT....................................................................................71
            -----------------
   10.6     NON-RELIANCE ON ADMINISTRATIVE AGENT AND OTHER LENDERS...............................................71
            ------------------------------------------------------
   10.7     INDEMNIFICATION......................................................................................72
            ---------------
   10.8     ADMINISTRATIVE AGENT IN ITS INDIVIDUAL CAPACITY......................................................72
            -----------------------------------------------
   10.9     SUCCESSOR ADMINISTRATIVE AGENT.......................................................................73
            ------------------------------

SECTION 11  MISCELLANEOUS........................................................................................73
            -------------

   11.1     NOTICES..............................................................................................73
            -------
   11.2     RIGHT OF SET-OFF.....................................................................................73
            ----------------
   11.3     BENEFIT OF AGREEMENT.................................................................................74
            --------------------
   11.4     NO WAIVER; REMEDIES CUMULATIVE.......................................................................77
            ------------------------------
   11.5     PAYMENT OF EXPENSES; INDEMNIFICATION.................................................................77
            ------------------------------------
   11.6     AMENDMENTS, WAIVERS AND CONSENTS.....................................................................78
            --------------------------------
   11.7     COUNTERPARTS/TELECOPY................................................................................79
            ---------------------
   11.8     HEADINGS.............................................................................................79
            --------
   11.9     DEFAULTING LENDER....................................................................................79
            -----------------
   11.10    SURVIVAL OF INDEMNIFICATION AND REPRESENTATIONS AND WARRANTIES.......................................79
            --------------------------------------------------------------
   11.11    GOVERNING LAW; JURISDICTION..........................................................................79
            ---------------------------
   11.12    WAIVER OF JURY TRIAL.................................................................................80
            --------------------
   11.13    SEVERABILITY.........................................................................................80
            ------------
   11.14    FURTHER ASSURANCES...................................................................................80
            ------------------
   11.15    ENTIRETY.............................................................................................80
            --------
   11.16    BINDING EFFECT; CONTINUING AGREEMENT.................................................................81
            ------------------------------------
</TABLE>

                                      iii
<PAGE>   5

   SCHEDULES

Schedule 1.1(a)            Revolving Loan Commitment Percentages
Schedule 1.1(b)            Permitted Liens
Schedule 6.10              Indebtedness
Schedule 6.11              Litigation
Schedule 6.15              Subsidiaries
Schedule 6.21(a)           Investment Policy
Schedule 6.21(b)           Investments
Schedule 6.25              Labor Contract and Disputes
Schedule 11.1              Notices

EXHIBITS

Exhibit 2.1(b)             Form of Notice of Borrowing
Exhibit 2.1(f)             Form of Revolving Note
Exhibit 2.2(b)             Form of Swingline Loan Request
Exhibit 2.2(e)             Form of Swingline Note
Exhibit 2.3                Form of Notice of Continuation/Conversion
Exhibit 7.1(c)             Form of Officer's Certificate
Exhibit 7.12               Form of Joinder Agreement
Exhibit 11.3(b)            Form of Assignment Agreement

                                       iv
<PAGE>   6

                                CREDIT AGREEMENT

         THIS CREDIT AGREEMENT (this "Credit Agreement") is entered into as of
August 31, 2000 among PULTE CORPORATION, a Michigan corporation (the
"Borrower"), each of the Material Subsidiaries of the Borrower (individually a
"Guarantor" and collectively the "Guarantors"), the Lenders (as defined herein),
BANK OF AMERICA, N.A., as Administrative Agent for the Lenders, BANK ONE, NA, as
Syndication Agent for the Lenders and COMERICA BANK, as Co-Agent for the
Lenders.

                                    RECITALS

         WHEREAS, the Borrower and the Guarantors have requested the Lenders to
provide a senior revolving credit facility in an aggregate principal amount of
up to $375 million, which may be increased in accordance with the terms hereof
to up to $600 million; and

         WHEREAS, the Lenders party hereto have agreed to make the requested
senior revolving credit facility available to the Borrower on the terms and
conditions hereinafter set forth.

         NOW, THEREFORE, IN CONSIDERATION of the premises and other good and
valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, the parties hereto agree as follows:

                                    SECTION 1

                        DEFINITIONS AND ACCOUNTING TERMS

         1.1      DEFINITIONS.

         As used herein, the following terms shall have the meanings herein
specified unless the context otherwise requires. Defined terms herein shall
include in the singular number the plural and in the plural the singular:

                  "Acquisition", by any Person, means the acquisition by such
         Person of the Capital Stock or all or substantially all of the assets
         of another Person, whether or not involving a merger or consolidation
         with such Person.

                  "Additional Credit Party" means each Person that becomes a
         Guarantor after the Closing Date, as provided in Section 7.12 or
         otherwise.

                  "Adjusted Eurodollar Rate" means the Eurodollar Rate plus the
         Applicable Percentage.

<PAGE>   7

                  "Adjusted LIBOR Market Index Rate" means the LIBOR Market
         Index Rate plus the Applicable Percentage.

                  "Administrative Agent" means Bank of America, N.A. (or any
         successor thereto) or any successor administrative agent appointed
         pursuant to Section 10.9.

                  "Administrative Fees" has the meaning set forth in Section
         3.4(c).

                  "Affiliate" means, with respect to any Person, any other
         Person directly or indirectly controlling (including but not limited to
         all directors and officers (or the equivalent) of such Person),
         controlled by or under direct or indirect common control with such
         Person. A Person shall be deemed to control an entity if such Person
         possesses, directly or indirectly, the power (a) to vote 10% or more of
         the ordinary voting power for the election of directors (or the
         equivalent) of such entity or (b) to direct or cause direction of the
         management and policies of such entity, whether through the ownership
         of voting securities, by contract or otherwise.

                  "Agency Services Address" means Bank of America, N.A., 231
         South LaSalle Street, Chicago, IL 60697, or such other address as may
         be identified by written notice from the Administrative Agent to the
         Borrower.

                  "Applicable Percentage" means, for Eurodollar Loans, Index
         Rate Swingline Loans and Facility Fees, the appropriate applicable
         percentages corresponding to the Debt to Capitalization Ratio and the
         long term unsecured debt rating of the Borrower as described below:

<TABLE>
<CAPTION>
     ----------------------------------------------------------------------------------------------------------------
                                                        Long Term             Applicable
                                                        Unsecured           Percentage for          Applicable
                                   Debt to             Debt Rating       Eurodollar Loans and       Percentage
            Pricing             Capitalization             of            Index Rate Swingline           for
             Level                  Ratio               Borrower                 Loans             Facility Fees
             -----                  -----               --------                 -----             -------------

     ----------------------------------------------------------------------------------------------------------------
<S>                            <C>                 <C>                   <C>                       <C>
               I                   <= 20%             =>BBB+/Baa1                .475%                 .150%
     ----------------------------------------------------------------------------------------------------------------
               II              > 20% but <= 35%          BBB/Baa2                .700%                 .175%
     ----------------------------------------------------------------------------------------------------------------
              III              > 35% but <= 45%         BBB-/Baa3                .825%                 .225%
     ----------------------------------------------------------------------------------------------------------------
               IV                   > 45%               <BBB-/Baa3              1.100%                 .275%
                                                   or not rated by S&P
                                                       and Moody's
     ----------------------------------------------------------------------------------------------------------------
</TABLE>

         In the event the Debt to Capitalization Ratio and the long term
         unsecured debt rating of the Borrower are not at the same level, the
         applicable Pricing Level shall be the lowest applicable level (i.e. the
         lowest pricing for the Borrower); provided, however, that if the Debt
         to Capitalization Ratio corresponds to a level more than one level
         lower than the long term debt rating of the Borrower, then the
         applicable Pricing Level shall be one level lower than the Pricing
         Level determined by the long term unsecured debt rating of the
         Borrower. In the event of a split in ratings between Moody's and S&P,
         the long term unsecured debt rating of the Borrower shall be the
         highest rating; provided, however, that if there is a split

                                       2
<PAGE>   8

         in ratings between Moody's and S&P of more than one level, the long
         term unsecured debt rating of the Borrower shall be one level lower
         than the highest rating. The Applicable Percentage shall be determined
         and adjusted, as necessary, on the date of any change in the long term
         unsecured debt rating of the Borrower or upon receipt of the officer's
         certificate required by Section 7.1(c) calculating the then Debt to
         Capitalization Ratio.

                  "Assignment Agreement" has the meaning set forth in Section
         11.3(b).

                  "Authorized Officer" means, with respect to any certificate
         required to be delivered pursuant to this Credit Agreement, the chief
         financial officer, treasurer or corporate controller of the Borrower or
         any other person designated in writing by such chief financial officer,
         treasurer or corporate controller.

                  "BAS" means Banc of America Securities LLC, in its capacity as
         Sole Lead Arranger and Sole Book Manager, and its successors and
         assigns.

                  "Bank of America" means Bank of America, N.A. and its
         successors and assigns.

                  "Bankruptcy Code" means the Bankruptcy Code in Title 11 of the
         United States Code, as amended, modified, succeeded or replaced from
         time to time.

                  "Base Rate" means, for any day, the rate per annum (rounded
         upwards, if necessary, to the nearest whole multiple of 1/100 of 1%)
         equal to the greater of (a) the Federal Funds Rate in effect on such
         day plus 1/2 of 1% or (b) the Prime Rate in effect on such day. If for
         any reason the Administrative Agent shall have determined (which
         determination shall be conclusive absent manifest error) that it is
         unable after due inquiry to ascertain the Federal Funds Rate for any
         reason, including the inability or failure of the Administrative Agent
         to obtain sufficient quotations in accordance with the terms hereof,
         the Base Rate shall be determined without regard to clause (a) of the
         first sentence of this definition until the circumstances giving rise
         to such inability no longer exist. Any change in the Base Rate due to a
         change in the Prime Rate or the Federal Funds Rate shall be effective
         on the effective date of such change in the Prime Rate or the Federal
         Funds Rate, respectively.

                  "Base Rate Loan" means any Loan bearing interest at a rate
         determined by reference to the Base Rate.

                  "Borrower" means Pulte Corporation, a Michigan corporation,
         together with any successors and permitted assigns.

                  "Business Day" means any day other than a Saturday, a Sunday,
         a legal holiday or a day on which banking institutions are authorized
         or required by law or other governmental action to close in Chicago,
         Illinois; provided that in the case of Eurodollar Loans, such day is
         also a day on which dealings between banks are carried on in Dollar
         deposits in the London interbank market.

                                       3
<PAGE>   9

                  "Capital Expenditures" means all expenditures of the Credit
         Parties and their Subsidiaries which, in accordance with GAAP, would be
         classified as capital expenditures, including, without limitation,
         Capital Leases.

                  "Capital Lease" means, as applied to any Person, any lease of
         any property (whether real, personal or mixed) by that Person as lessee
         which, in accordance with GAAP, is or should be accounted for as a
         capital lease on the balance sheet of that Person and the amount of
         such obligation shall be the capitalized amount thereof determined in
         accordance with GAAP.

                  "Capital Stock" means (a) in the case of a corporation, all
         classes of capital stock of such corporation, (b) in the case of a
         partnership, partnership interests (whether general or limited), (c) in
         the case of a limited liability company, membership interests and (d)
         any other interest or participation that confers on a Person the right
         to receive a share of the profits and losses of, or distributions of
         assets of, the issuing Person.

                  "Capitalization" means (a) Funded Debt plus (b) the
         consolidated net shareholders equity of the Borrower as determined in
         accordance with GAAP.

                  "Cash Equivalents" means (a) securities issued or directly and
         fully guaranteed or insured by the United States of America or any
         agency or instrumentality thereof (provided that the full faith and
         credit of the United States of America is pledged in support thereof)
         having maturities of not more than 180 days from the date of
         acquisition, (b) Dollar denominated time and demand deposits and
         certificates of deposit of (i) any Lender, (ii) any domestic commercial
         bank having capital and surplus in excess of $500,000,000 or (iii) any
         bank whose short-term commercial paper rating from S&P is at least A-2
         or the equivalent thereof or from Moody's is at least P-2 or the
         equivalent thereof (any such bank being an "Approved Bank"), in each
         case with maturities of not more than 180 days from the date of
         acquisition, (c) commercial paper and variable or fixed rate notes
         issued by any Approved Bank (or by the parent company thereof) or any
         variable rate notes issued by, or guaranteed by, any domestic
         corporation rated A-2 (or the equivalent thereof) or better by S&P or
         P-2 (or the equivalent thereof) or better by Moody's and maturing
         within 180 days of the date of acquisition, (d) repurchase agreements
         with a bank or trust company (including any of the Lenders) or
         recognized securities dealer having capital and surplus in excess of
         $500,000,000 for direct obligations issued by or fully guaranteed by
         the United States of America in which the Borrower shall have a
         perfected first priority security interest (subject to no other Liens)
         and having, on the date of purchase thereof, a fair market value of at
         least 100% of the amount of the repurchase obligations, (e)
         Investments, classified in accordance with GAAP as current assets, in
         money market investment programs registered under the Investment
         Company Act of 1940, as amended, which are administered by reputable
         financial institutions having capital of at least $500,000,000 and the
         portfolios of which are limited to Investments of the character
         described in the foregoing subdivisions (a) through (d), and (f)
         Investments consistent with the Pulte Corporation Investment Policy as
         set forth on Schedule 6.21(a).

                                       4
<PAGE>   10

                  "Change of Control" means the occurrence of any of the
         following events: (a) there shall be consummated any consolidation,
         share exchange or merger of the Borrower in which the Borrower is not
         the continuing or surviving corporation or pursuant to which the
         Borrower's Voting Stock would be converted into cash, securities or
         other property, other than, in any case, a merger of the Borrower in
         which the holders of Voting Stock immediately prior to the merger have
         the same or greater proportionate ownership, directly or indirectly, of
         the Voting Stock of the surviving corporation immediately after the
         merger as they had of the Voting Stock of the Borrower immediately
         before the merger; (b) there is a report filed by any Person, including
         Affiliates of the Borrower (other than the Borrower, its Material
         Subsidiaries, employee stock ownership plans or employee benefit plans
         of the Borrower or its subsidiaries, or a Permitted Holder) on Schedule
         13D or 14D-1 (or any successor schedule, form or report under the
         Exchange Act) disclosing that such Person (for the purpose of this
         definition of "Change in Control" only, the term "Person" shall include
         a "person" within the meaning of Section 13(d)(3) and Section 14(d)(2)
         of the Exchange Act or any successor provision to either of the
         foregoing) has become the beneficial owner (as the term "beneficial
         owner" is defined under Rule 13d-3, Rule 13d-5 or any successor rule or
         regulation promulgated under the Exchange Act) of 30% or more of the
         Borrower's Voting Stock; provided, however, that a Person shall not be
         deemed the beneficial owner of, or to own beneficially (i) any
         securities tendered pursuant to a tender or exchange offer made on
         behalf of such Person or any of such Person's Affiliates until such
         tendered securities are accepted for purchase or exchange thereunder or
         (ii) any securities if such beneficial ownership (A) arises solely as a
         result of a revocable proxy delivered in response to a proxy or consent
         solicitation made pursuant to, and in accordance with, the applicable
         rules and regulations under the Exchange Act, and (B) is not also then
         reportable on Schedule 13D (or any successor schedule, form or report)
         under the Exchange Act; or (c) during any period of two consecutive
         calendar years, individuals who, at the beginning of such period
         constituted the board of directors of the Borrower cease for any reason
         to constitute a majority of the directors of the Borrower then in
         office unless such new directors were elected by the directors of the
         Borrower who constituted the board of directors of the Borrower at the
         beginning of such period.

                  "Closing Date" means the date hereof.

                  "Co-Agent" means Comerica Bank (or any successor thereto).

                  "Code" means the Internal Revenue Code of 1986 and the rules
         and regulations promulgated thereunder, as amended, modified, succeeded
         or replaced from time to time. References to sections of the Code
         should be construed also to refer to any successor sections.

                  "Commitments" means (a) with respect to each Lender, the
         Revolving Loan Commitment of such Lender and (b) with respect to Bank
         of America, the Swingline Loan Commitment.

                                       5
<PAGE>   11

                  "Consolidated Net Tangible Assets" means, as of any date of
         determination, the sum of (a) Tangible Net Worth and (b) Funded Debt.

                  "Credit Documents" means this Credit Agreement, the Notes, any
         Joinder Agreement and all other related agreements and documents issued
         or delivered hereunder or thereunder or pursuant hereto or thereto.

                  "Credit Parties" means the Borrower and the Guarantors and
         "Credit Party" means any one of them.

                  "Credit Party Obligations" means, without duplication, all of
         the obligations of the Credit Parties to the Lenders and the
         Administrative Agent, whenever arising, under this Credit Agreement,
         the Notes or any other Credit Document to which any Credit Party is a
         party.

                  "Debt to Capitalization Ratio" means, as of any date, the
         ratio of (a) Funded Debt less (i) Subordinated Debt issued by the
         Credit Parties which matures on or after the Maturity Date in an
         aggregate amount not to exceed $100 million and (ii) all cash and Cash
         Equivalents held by the Credit Parties in excess of $25,000,000 to (b)
         Capitalization.

                  "Default" means any event, act or condition which with notice
         or lapse of time, or both, would constitute an Event of Default.

                  "Defaulting Lender" means, at any time, any Lender that (a)
         has failed to make a Loan or purchase a Participation Interest required
         pursuant to the terms of this Credit Agreement (but only for so long as
         such Loan is not made or such Participation Interest is not purchased),
         (b) has failed to pay to the Administrative Agent or any other Lender
         an amount owed by such Lender pursuant to the terms of this Credit
         Agreement (but only for so long as such amount has not been paid) or
         (c) has been deemed insolvent or has become subject to a bankruptcy or
         insolvency proceeding or with respect to which (or with respect to any
         assets of which) a receiver, trustee or similar official has been
         appointed.

                  "Dollars" and "$" mean dollars in lawful currency of the
         United States of America.

                  "Domestic Subsidiaries" means all direct and indirect
         Subsidiaries of a Credit Party that are domiciled, incorporated or
         organized under the laws of any state of the United States or the
         District of Columbia (or has any material assets located in the United
         States).

                  "EBITDA" means, for any period, with respect to the Borrower,
         the sum of (a) Net Income for such period (excluding the effect of any
         extraordinary or other non-recurring gains or losses outside of the
         ordinary course of business) plus (b) an amount which, in the
         determination of Net Income for such period has been deducted for (i)
         interest expense (including previously capitalized interest included in
         the cost of goods sold) of the Credit Parties and their Subsidiaries
         for such period, (ii) total Federal, state, foreign or other

                                       6
<PAGE>   12

         income taxes of the Borrower for such period and (iii) depreciation and
         amortization of the Credit Parties and their Subsidiaries for such
         period, all as determined in accordance with GAAP.

                  "Effective Date" means the date on which the conditions set
         forth in Section 5.1 shall have been fulfilled (or waived in the sole
         discretion of the Lenders).

                  "Eligible Assignee" means (a) any Lender; (b) an Affiliate of
         a Lender; and (c) any other Person approved by the Administrative Agent
         and the Borrower (such approval not to be unreasonably withheld or
         delayed); provided that (i) the Borrower's consent is not required
         during the existence and continuation of an Event of Default, (ii)
         approval by the Borrower shall be deemed given if no objection is
         received by the assigning Lender and the Administrative Agent from the
         Borrower within two Business Days after notice of such proposed
         assignment has been received by the Borrower; and (iii) neither the
         Borrower nor an Affiliate of the Borrower shall qualify as an Eligible
         Assignee.

                  "Environmental Claim" means any investigation, written notice,
         violation, written demand, written allegation, action, suit,
         injunction, judgment, order, consent decree, penalty, fine, lien,
         proceeding, or written claim whether administrative, judicial, or
         private in nature arising (a) pursuant to, or in connection with, an
         actual or alleged violation of, any Environmental Law, (b) in
         connection with any Hazardous Material, (c) from any assessment,
         abatement, removal, remedial, corrective, or other response action in
         connection with an Environmental Law or other order of a Governmental
         Authority or (d) from any actual or alleged damage, injury, threat, or
         harm to health, safety, natural resources, or the environment.

                  "Environmental Laws" means any current or future legal
         requirement of any Governmental Authority pertaining to (a) the
         protection of health, safety, and the indoor or outdoor environment,
         (b) the conservation, management, or use of natural resources and
         wildlife, (c) the protection or use of surface water and groundwater or
         (d) the management, manufacture, possession, presence, use, generation,
         transportation, treatment, storage, disposal, release, threatened
         release, abatement, removal, remediation or handling of, or exposure
         to, any hazardous or toxic substance or material or (e) pollution
         (including any release to land, surface water and groundwater) and
         includes, without limitation, the Comprehensive Environmental Response,
         Compensation, and Liability Act of 1980, as amended by the Superfund
         Amendments and Reauthorization Act of 1986, 42 USC 9601 et seq., Solid
         Waste Disposal Act, as amended by the Resource Conservation and
         Recovery Act of 1976 and Hazardous and Solid Waste Amendments of 1984,
         42 USC 6901 et seq., Federal Water Pollution Control Act, as amended by
         the Clean Water Act of 1977, 33 USC 1251 et seq., Clean Air Act of
         1966, as amended, 42 USC 7401 et seq., Toxic Substances Control Act of
         1976, 15 USC 2601 et seq., Hazardous Materials Transportation Act, 49
         USC App. 1801 et seq., Occupational Safety and Health Act of 1970, as
         amended, 29 USC 651 et seq., Oil Pollution Act of 1990, 33 USC 2701 et
         seq., Emergency Planning and Community Right-to-Know Act of 1986, 42
         USC 11001 et seq., National Environmental Policy Act of 1969, 42 USC
         4321 et seq., Safe Drinking Water Act of 1974, as amended, 42

                                       7
<PAGE>   13

         USC 300(f) et seq., any analogous implementing or successor law, and
         any amendment, rule, regulation, order, or directive issued thereunder.

                  "Equity Issuance" means any issuance by a Credit Party to any
         Person of (a) shares of its Capital Stock, (b) any shares of its
         Capital Stock pursuant to the exercise of options or warrants or (c)
         any shares of its Capital Stock pursuant to the conversion of any debt
         securities to equity.

                  "ERISA" means the Employee Retirement Income Security Act of
         1974, as amended, and any successor statute thereto, as interpreted by
         the rules and regulations thereunder, all as the same may be in effect
         from time to time. References to sections of ERISA shall be construed
         also to refer to any successor sections.

                  "ERISA Affiliate" means an entity, whether or not
         incorporated, which is under common control with any Credit Party or
         any of its Subsidiaries within the meaning of Section 4001(a)(14) of
         ERISA, or is a member of a group which includes any Credit Party or any
         of its Subsidiaries and which is treated as a single employer under
         Sections 414(b), (c), (m), or (o) of the Code.

                  "Eurodollar Loan" means a Loan bearing interest based on a
         rate determined by reference to the Eurodollar Rate.

                  "Eurodollar Rate" means, for the Interest Period for each
         Eurodollar Loan comprising part of the same borrowing (including
         conversions, extensions and renewals), a per annum interest rate
         determined pursuant to the following formula:

                  Eurodollar Rate =      London Interbank Offered Rate
                                     ---------------------------------
                                      1 - Eurodollar Reserve Percentage

                  "Eurodollar Reserve Percentage" means for any day, that
         percentage (expressed as a decimal) which is in effect from time to
         time under Regulation D of the Board of Governors of the Federal
         Reserve System (or any successor), as such regulation may be amended
         from time to time or any successor regulation, as the maximum reserve
         requirement (including, without limitation, any basic, supplemental,
         emergency, special, or marginal reserves) applicable with respect to
         Eurocurrency liabilities as that term is defined in Regulation D (or
         against any other category of liabilities that includes deposits by
         reference to which the interest rate of Eurodollar Loans is
         determined), whether or not a Lender has any Eurocurrency liabilities
         subject to such reserve requirement at that time. Eurodollar Loans
         shall be deemed to constitute Eurocurrency liabilities and as such
         shall be deemed subject to reserve requirements without benefits of
         credits for proration, exceptions or offsets that may be available from
         time to time to a Lender. The Eurodollar Rate shall be adjusted
         automatically on and as of the effective date of any change in the
         Eurodollar Reserve Percentage.

                                       8
<PAGE>   14

                  "Event of Default" means any of the events or circumstances
         specified in Section 9.1.

                  "Exchange Act" means the Securities Exchange Act of 1934, as
         amended, and the rules and regulations promulgated thereunder, as
         amended, modified, succeeded or replaced from time to time.

                  "Existing Credit Agreements" means (a) that certain Credit
         Agreement, dated as of January 5, 1995, by and among the Borrower,
         certain guarantors (as defined therein), Bank of America, N.A.,
         formerly NationsBank, N.A., as agent, Comerica Bank and Bank One, NA,
         formerly The First National Bank of Chicago, as co-agents and the
         lenders party thereto, as the same has been and may be amended,
         restated or otherwise modified from time to time and (b) that certain
         Credit Agreement, dated as of September 15, 1999, by and among the
         Borrower, certain guarantors (as defined therein), Bank of America,
         N.A., as administrative agent, Bank One, NA, as syndication agent,
         Guaranty Federal Bank, F.S.B., as co-agent and the lenders party
         thereto, as the same has been and may be amended, restated or otherwise
         modified from time to time.

                  "Extending Lender" has the meaning set forth in Section
         2.5(a).

                  "Extension of Credit" means, as to any Lender, the making of a
         Loan by such Lender (or a participation therein by a Lender).

                  "Extension Required Lenders" has the meaning set forth in
         Section 2.5(a).

                  "Facility Fees" means the fees payable to the Lenders pursuant
         to Section 3.4(a).

                  "Federal Funds Rate" means for any day the rate of interest
         per annum (rounded upward, if necessary, to the nearest 1/100th of 1%)
         equal to the weighted average of the rates on overnight Federal funds
         transactions with members of the Federal Reserve System arranged by
         Federal funds brokers on such day, as published by the Federal Reserve
         Bank of New York on the Business Day next succeeding such day; provided
         that (a) if such day is not a Business Day, the Federal Funds Rate for
         such day shall be such rate on such transactions on the next preceding
         Business Day and (b) if no such rate is so published on such next
         preceding Business Day, the Federal Funds Rate for such day shall be
         the average rate quoted to the Administrative Agent on such day on such
         transactions as determined by the Administrative Agent.

                  "Fee Letter" means that certain letter agreement dated as of
         July 17, 2000 among the Borrower, BAS and the Administrative Agent.

                  "Funded Debt" means, without duplication, the sum of all
         Indebtedness of the Credit Parties for borrowed money, including,
         without limitation, (a) all purchase money Indebtedness of the Credit
         Parties, (b) the principal portion of all obligations of the Credit
         Parties under Capital Leases, (c) all Guaranty Obligations of the
         Credit Parties with respect

                                       9
<PAGE>   15

         to Indebtedness of another Person, (d) all Indebtedness of another
         entity secured by a Lien on any property of the Credit Parties whether
         or not such Indebtedness has been assumed by a Credit Party, and (e)
         all Indebtedness of any partnership or unincorporated joint venture to
         the extent a Credit Party is legally obligated or has a reasonable
         expectation of being liable with respect thereto, net of any assets of
         such partnership or joint venture.

                  "GAAP" means generally accepted accounting principles in the
         United States applied on a consistent basis and subject to Section 1.3.

                  "Governmental Authority" means any Federal, state, local,
         provincial or foreign court or governmental agency, authority,
         instrumentality or regulatory body.

                  "Guarantor" means each of the Material Subsidiaries of the
         Borrower and each Additional Credit Party which has executed a Joinder
         Agreement or otherwise become a Guarantor hereunder, together with
         their successors and assigns.

                  "Guaranty Obligations" means, with respect to any Person,
         without duplication, any obligations (other than endorsements in the
         ordinary course of business of negotiable instruments for deposit or
         collection) guaranteeing or intending to guarantee any Indebtedness of
         any other Person in any manner, whether direct or indirect, and
         including without limitation any obligation, whether or not contingent,
         (a) to purchase any such Indebtedness or other obligation or any
         property constituting security therefor, (b) to advance or provide
         funds or other support for the payment or purchase of such Indebtedness
         or obligation or to maintain working capital, solvency or other balance
         sheet condition of such other Person (including, without limitation,
         maintenance agreements, comfort letters, take or pay arrangements, put
         agreements or similar agreements or arrangements) for the benefit of
         the holder of Indebtedness of such other Person, (c) to lease or
         purchase property, securities or services primarily for the purpose of
         assuring the owner of such Indebtedness against loss in respect thereof
         or (d) to otherwise assure or hold harmless the owner of such
         Indebtedness or obligation against loss in respect thereof; provided,
         that a guaranty of Non-Recourse Land Financing shall not be deemed to
         be a Guaranty Obligation until, and only to the extent that, such
         Non-Recourse Land Financing ceases to be Non-Recourse Land Financing.
         The amount of any Guaranty Obligation hereunder shall (subject to any
         limitations set forth therein) be deemed to be an amount equal to the
         outstanding principal amount (or maximum principal amount, if larger)
         of the Indebtedness in respect of which such Guaranty Obligation is
         made.

                  "Hazardous Materials" means any substance, material or waste
         defined in or regulated under any Environmental Laws.

                  "Hedging Agreements" means any interest rate protection
         agreements, foreign currency exchange agreements, commodity futures
         agreements or other interest or exchange rate hedging agreements.

                                       10
<PAGE>   16

                  "Indebtedness" of any Person means, without duplication, (a)
         all obligations of such Person for borrowed money, (b) all obligations
         of such Person evidenced by bonds, debentures, notes or similar
         instruments, or upon which interest payments are customarily made, (c)
         all obligations of such Person under conditional sale or other title
         retention agreements relating to property purchased by such Person to
         the extent of the value of such property (other than customary
         reservations or retentions of title under agreements with suppliers
         entered into in the ordinary course of business), (d) all obligations,
         other than intercompany items, of such Person issued or assumed as the
         deferred purchase price of property or services purchased by such
         Person which would appear as liabilities on a balance sheet of such
         Person, (e) all Indebtedness of others secured by (or for which the
         holder of such Indebtedness has an existing right, contingent or
         otherwise, to be secured by) any Lien on, or payable out of the
         proceeds of production from, property owned or acquired by such Person,
         whether or not the obligations secured thereby have been assumed, (f)
         all Guaranty Obligations of such Person, (g) the principal portion of
         all obligations of such Person under (i) Capital Leases and (ii) any
         synthetic lease, tax retention operating lease, off-balance sheet loan
         or similar off-balance sheet financing product of such Person where
         such transaction is considered borrowed money indebtedness for tax
         purposes but is classified as an operating lease in accordance with
         GAAP, (h) all net obligations of such Person in respect of Hedging
         Agreements, (i) all preferred stock issued by such Person and required
         by the terms thereof to be redeemed, or for which mandatory sinking
         fund payments are due by a fixed date, (j) the aggregate amount of
         uncollected accounts receivable of such Person subject at such time to
         a sale of receivables (or similar transaction) regardless of whether
         such transaction is effected without recourse to such Person or in a
         manner that would not be reflected on the balance sheet of such Person
         in accordance with GAAP, and (k) all obligations of such Person to
         repurchase any securities which repurchase obligation is related to the
         issuance thereof, including, without limitation, obligations commonly
         known as residual equity appreciation potential shares. The
         Indebtedness of any Person shall include the Indebtedness of any
         partnership or unincorporated joint venture in which such Person is
         legally obligated.

                  "Index Rate Swingline Loan" means a Swingline Loan bearing
         interest at the Adjusted LIBOR Market Index Rate.

                  "Intellectual Property" has the meaning set forth in Section
         6.19.

                  "Interest Coverage Ratio" means, as of the end of each fiscal
         quarter of the Borrower for the twelve month period ending on such
         date, with respect to the Borrower, the ratio of (a) EBITDA for the
         applicable period to (b) interest incurred by the Credit Parties,
         whether such interest was expensed, capitalized, paid, accrued or
         scheduled to be paid or accrued.

                  "Interest Payment Date" means (a) as to Base Rate Loans, the
         last day of each calendar month and the Maturity Date and (b) as to
         Eurodollar Loans, the last day of each applicable Interest Period and
         the Maturity Date and in addition, where the applicable

                                       11
<PAGE>   17

         Interest Period for a Eurodollar Loan is greater than three months,
         then also the date three months from the beginning of the Interest
         Period and each three months thereafter.

                  "Interest Period" means, (a) with respect to Eurodollar Loans,
         a period of one, two, three or six months' duration, as the Borrower
         may elect, commencing, in each case, on the date of the borrowing
         (including continuations and conversions thereof) and (b) with respect
         to Index Rate Swingline Loans, a period beginning on the date of
         advance and ending on the date specified in the applicable Swingline
         Loan Request, which shall be between one and seven Business Days in
         duration; provided, however, that (i) if any Interest Period would end
         on a day which is not a Business Day, such Interest Period shall be
         extended to the next succeeding Business Day (except that where the
         next succeeding Business Day falls in the next succeeding calendar
         month, such Interest Period shall end on the next preceding Business
         Day), (ii) no Interest Period shall extend beyond the Maturity Date,
         and (iii) with respect to Eurodollar Loans, where an Interest Period
         begins on a day for which there is no numerically corresponding day in
         the calendar month in which the Interest Period is to end, such
         Interest Period shall end on the last Business Day of such calendar
         month.

                  "Investment" in any Person means (a) the acquisition (whether
         for cash, property, services, assumption of Indebtedness, securities or
         otherwise) of assets (other than assets acquired in the ordinary course
         of business), shares of Capital Stock, bonds, notes, debentures, joint
         venture, partnership or other ownership interests or other securities
         of such other Person or (b) any deposit with, or advance, loan or other
         extension of credit to, such Person (other than deposits made in
         connection with the purchase of equipment or other assets in the
         ordinary course of business) or (c) any other capital contribution to
         or investment in such Person, including, without limitation, any
         Guaranty Obligation incurred for the benefit of such Person and any
         support provided for a Letter of Credit issued on behalf of such
         Person.

                  "Joinder Agreement" means a joinder agreement substantially in
         the form of Exhibit 7.12.

                  "Lender" means any of the Persons identified as a "Lender" on
         the signature pages hereto, and any Eligible Assignee which may become
         a Lender by way of assignment in accordance with the terms hereof,
         together with their successors and permitted assigns.

                  "LIBOR Market Index Rate" shall mean, for any day, the one
         week London Interbank Offered Rate for U.S. Dollar deposits (rounded
         upwards, if necessary, to the nearest 1/100 of 1%) appearing on
         Telerate Page 3750 (or any successor page) as of 11:00 A.M. (London
         time) on such day, or if such day is not a Business Day, then the
         immediately preceding Business Day, or if not so reported, then as
         determined by the Administrative Agent from another recognized source
         of interbank quotation; provided, however, if more than one rate is
         specified on Telerate Page 3750, the applicable rate shall be the
         arithmetic mean of all such rates.

                                       12
<PAGE>   18

                  "Lien" means any mortgage, pledge, hypothecation, assignment,
         deposit arrangement, security interest, encumbrance, lien (statutory or
         otherwise), preference, priority or charge of any kind, including,
         without limitation, any agreement to give any of the foregoing, any
         conditional sale or other title retention agreement, and any lease in
         the nature thereof.

                  "Loan" or "Loans" means the Revolving Loans and the Swingline
         Loans (or a portion of any Revolving Loan or Swingline Loan),
         individually or collectively, as appropriate.

                  "London Interbank Offered Rate" means, with respect to any
         Eurodollar Loan for the Interest Period applicable thereto, the rate of
         interest per annum (rounded upwards, if necessary, to the nearest 1/100
         of 1%) appearing on Telerate Page 3750 (or any successor page) as the
         London Interbank Offered Rate for deposits in Dollars at approximately
         11:00 A.M. (London time) two Business Days prior to the first day of
         such Interest Period and having an advance date and a maturity date
         comparable to such Interest Period; provided, however, if more than one
         rate is specified on Telerate Page 3750, the applicable rate shall be
         the arithmetic mean of all such rates.

                  "Material Adverse Effect" means a material adverse effect on
         (a) the business, assets, liabilities (actual or contingent),
         operations, condition (financial or otherwise) or prospects of the
         Credit Parties taken as a whole, (b) the ability of the Credit Parties
         taken as a whole to perform their obligations under this Credit
         Agreement or any of the other Credit Documents, or (c) the validity or
         enforceability of this Credit Agreement, any of the other Credit
         Documents, or the rights and remedies of the Lenders hereunder or
         thereunder taken as a whole.

                  "Material Subsidiary" means any Domestic Subsidiary of the
         Borrower, now owned or hereafter acquired, that has assets with a fair
         market value of $10,000,000 or greater other than as set forth in
         clauses (a), (b), (c) and (d) below; provided that in no event may
         there exist Domestic Subsidiaries of the Borrower (other than the
         Excluded Subsidiaries) that have assets, in the aggregate, with a fair
         market value in excess of $50,000,000 that are not Guarantors
         hereunder. For purposes of this definition, the following Subsidiaries
         (collectively, the "Excluded Subsidiaries") shall not be considered
         Material Subsidiaries: (a) Pulte Mortgage Corporation; (b) First
         Heights Bank; (c) North American Builders Indemnity Company; (d)
         Subsidiaries the investment in which was made as permitted by clause
         (f) of the definition of Permitted Investments; (e) any Subsidiary
         formed for the specific purpose of (i) acquiring mortgages or other
         assets from a Credit Party, for cash or Cash Equivalents and at a value
         which is comparable to that which would be obtained for such assets on
         an arm's length transaction and (ii) entering into a securitization
         program (or similar transaction or series of transactions) with respect
         to the acquired assets; provided that the sole recourse of such
         Subsidiary's creditors is the assets of such Subsidiary or another
         Person that is not a Credit Party; and (f) a Domestic Subsidiary whose
         sole asset is the ownership of a foreign entity or assets of a foreign
         entity; provided that the investment in any such Subsidiary subsequent
         to the Closing Date must be a Permitted Investment.

                                       13
<PAGE>   19

                  "Maturity Date" means August 31, 2005, as such date may be
         extended in accordance with the terms of Section 2.5 (other than with
         respect to the Commitments and Loans of any Refusing Lender, in which
         case the applicable Maturity Date for such Commitments and Loans shall
         be the RL Maturity Date).

                  "Moody's" means Moody's Investors Service, Inc., or any
         successor or assignee of the business of such company in the business
         of rating securities.

                  "Multiemployer Plan" means a Plan covered by Title IV of ERISA
         which is a multiemployer plan as defined in Section 3(37) or 4001(a)(3)
         of ERISA.

                  "Multiple Employer Plan" means a Plan covered by Title IV of
         ERISA, other than a Multiemployer Plan, with respect to which any
         Credit Party or any of its Subsidiaries or any ERISA Affiliate and at
         least one employer other than a Credit Party or any of its Subsidiaries
         or any ERISA Affiliate are contributing sponsors.

                  "Net Income" means, for any period, the net income after taxes
         for such period of the Borrower, as determined in accordance with GAAP.

                  "Non-Excluded Taxes" has the meaning set forth in Section
         3.13.

                  "Non-Recourse Land Financing" means any Indebtedness of any
         Credit Party for which the owner of such Indebtedness has no recourse,
         directly or indirectly, to a Credit Party for the principal of,
         premium, if any, and interest on such Indebtedness, and for which a
         Credit Party is not, directly or indirectly, obligated or otherwise
         liable for the principal of, premium, if any, and interest on such
         Indebtedness, except pursuant to mortgages, deeds of trust or other
         security interests or other recourse obligations or liabilities in
         respect of specific land or other real property interests of a Credit
         Party; provided that recourse obligations or liabilities of a Credit
         Party solely for indemnities, covenants or breach of warranty,
         representation or covenant in respect of any Indebtedness will not
         prevent Indebtedness from being classified as Non-Recourse Land
         Financing.

                  "Note" or "Notes" means the Revolving Notes and the Swingline
         Note, individually or collectively, as appropriate.

                  "Notice of Borrowing" means a request by the Borrower for a
         Revolving Loan, in the form of Exhibit 2.1(b).

                  "Notice of Continuation/Conversion" means a request by the
         Borrower to continue an existing Eurodollar Loan for a new Interest
         Period or to convert a Eurodollar Loan to a Base Rate Loan (other than
         a Swingline Loan) or a Base Rate Loan (other than a Swingline Loan) to
         a Eurodollar Loan, in the form of Exhibit 2.3.

                                       14
<PAGE>   20

                  "Participation Interest" means the Extension of Credit by a
         Lender by way of a purchase of a participation in any Loans as provided
         in Section 2.2 or Section 3.8.

                  "PBGC" means the Pension Benefit Guaranty Corporation
         established pursuant to Subtitle A of Title IV of ERISA and any
         successor thereto.

                  "Permitted Holder" means (i) William J. Pulte, (ii) any of his
         Affiliates, parents, spouse, descendants and spouses of descendants or
         (iii) any trusts or other entities controlled by Mr. Pulte and his
         respective estates, heirs, administrators or personal representatives.

                  "Permitted Investments" means Investments which are (a) cash
         or Cash Equivalents, (b) accounts receivable created, acquired or made
         in the ordinary course of business and payable or dischargeable in
         accordance with customary trade terms, (c) inventory, raw materials and
         general intangibles acquired in the ordinary course of business, (d)
         Investments by a Credit Party in another Credit Party, (e) loans to
         directors, officers, employees, agents, customers or suppliers in the
         ordinary course of business, including the financing to purchasers of
         homes and other residential properties from a Credit Party, not to
         exceed, in the aggregate, $10,000,000 at any one time, (f) Investments
         in international home building and related ventures not to exceed $150
         million during the term of this Credit Agreement, (g) Investments in
         Pulte Mortgage Corporation in an amount not to exceed at any one time
         the sum of (i) $100 million plus (ii) amounts (net of applicable taxes)
         received by the Credit Parties from Pulte Mortgage Corporation, as a
         dividend, subsequent to the Closing Date, (h) acquisitions of mortgages
         from Pulte Mortgage Corporation or another Affiliate of the Borrower at
         market or better than market terms for similar types of loans, (i)
         Investments in Capital Expenditures, or (j) other Investments (in
         addition to those set forth above) not to exceed, in the aggregate,
         $200 million at any one time.

                  "Permitted Liens" means (a) Liens securing Credit Party
         Obligations; (b) Liens for taxes not yet due or Liens for taxes being
         contested in good faith by appropriate proceedings for which adequate
         reserves determined in accordance with GAAP have been established (and
         as to which the property subject to any such Lien is not yet subject to
         foreclosure, sale or loss on account thereof); (c) Liens in respect of
         property imposed by law arising in the ordinary course of business such
         as materialmen's, mechanics', warehousemen's, carrier's, landlords' and
         other nonconsensual statutory Liens which are not yet due and payable
         or which are being contested in good faith by appropriate proceedings
         for which adequate reserves determined in accordance with GAAP have
         been established (and as to which the property subject to any such Lien
         is not yet subject to foreclosure, sale or loss on account thereof);
         (d) pledges or deposits made in the ordinary course of business to
         secure payment of worker's compensation insurance, unemployment
         insurance, pensions or social security programs; (e) Liens arising from
         good faith deposits in connection with or to secure performance of
         tenders, bids, leases, government contracts, performance and
         return-of-money bonds and other similar obligations incurred in the
         ordinary course of business (other than obligations in respect of the
         payment of borrowed money); (f) Liens arising from good faith deposits
         in connection with or to secure performance of statutory obligations
         and

                                       15
<PAGE>   21

         surety and appeal bonds; (g) easements, rights-of-way, restrictions
         (including zoning restrictions), matters of plat, minor defects or
         irregularities in title and other similar charges or encumbrances not,
         in any material respect, impairing the use of the encumbered property
         for its intended purposes; (h) judgment Liens that would not constitute
         an Event of Default; (i) Liens in connection with Capital Leases and
         Liens securing Indebtedness permitted by Section 8.1(g) and (h); (j)
         Liens arising by virtue of any statutory or common law provision
         relating to banker's liens, rights of setoff or similar rights as to
         deposit accounts or other funds maintained with a creditor depository
         institution; (k) Liens existing on the Closing Date and identified on
         Schedule 1.1(b); and (l) Liens granted to secure any Indebtedness
         permitted by Section 8.1(b); provided that (i) no such Lien shall
         extend to any property other than the property subject thereto on the
         Closing Date and (ii) the principal amount of the Indebtedness secured
         by such Liens shall not be increased from that existing as of the
         Closing Date (as such Indebtedness has been amortized subsequent to the
         Closing Date).

                  "Person" means any individual, partnership, joint venture,
         firm, corporation, limited liability company, association, trust or
         other enterprise (whether or not incorporated), or any Governmental
         Authority.

                  "Plan" means any employee benefit plan (as defined in Section
         3(3) of ERISA) which is covered by ERISA and with respect to which any
         Credit Party or any of its Subsidiaries or any ERISA Affiliate is (or,
         if such plan were terminated at such time, would under Section 4069 of
         ERISA be deemed to be) an "employer" within the meaning of Section 3(5)
         of ERISA.

                  "Prime Rate" means the per annum rate of interest established
         from time to time by the Administrative Agent as its prime rate in
         effect at its principal office in Charlotte, North Carolina (or such
         other principal office of the Administrative Agent as communicated in
         writing to the Borrower and the Lenders). Any change in the interest
         rate resulting from a change in the Prime Rate shall become effective
         as of 12:01 a.m. of the Business Day on which each change in the Prime
         Rate is announced by the Administrative Agent. The Prime Rate is a
         reference rate used by the Administrative Agent in determining interest
         rates on certain loans and is not intended to be the lowest rate of
         interest charged on any extension of credit to any debtor.

                  "Real Properties" means such real properties as the Credit
         Parties may own or lease (as lessee or sublessee) from third parties
         from time to time.

                  "Refusing Lender" has the meaning set forth in Section 2.5(a).

                  "Register" has the meaning set forth in Section 11.3(c).

                  "Regulation A, D, O, T, U, or X" means Regulation A, D, O, T,
         U or X, respectively, of the Board of Governors of the Federal Reserve
         System as from time to time in effect and any successor to all or a
         portion thereof.

                                       16
<PAGE>   22
                  "Reportable Event" means a "reportable event" as defined in
         Section 4043 of ERISA with respect to which the notice requirements to
         the PBGC have not been waived.

                  "Required Lenders" means Lenders whose aggregate Credit
         Exposure (as hereinafter defined) constitutes at least 51% of the
         Credit Exposure of all Lenders at such time; provided, however, that if
         any Lender shall be a Defaulting Lender at such time then there shall
         be excluded from the determination of Required Lenders the aggregate
         principal amount of Credit Exposure of such Lender at such time. For
         purposes of the preceding sentence, the term "Credit Exposure" as
         applied to each Lender shall mean (a) at any time prior to the
         termination of the Commitments, the Revolving Loan Commitment
         Percentage of such Lender multiplied by the Revolving Committed Amount
         and (b) at any time after the termination of the Commitments, the sum
         of (i) the principal balance of the outstanding Loans of such Lender
         plus (ii) such Lender's Participation Interests in the face amount of
         the outstanding Swingline Loans.

                  "Requirement of Law" means, as to any Person, the articles or
         certificate of incorporation and by-laws or other organizational or
         governing documents of such Person, and any law, treaty, rule or
         regulation or final, non-appealable determination of an arbitrator or a
         court or other Governmental Authority, in each case applicable to or
         binding upon such Person or to which any of its material property is
         subject.

                  "Revolving Committed Amount" means the aggregate of the
         Revolving Loan Commitments of all Lenders, as such amount may be
         increased, reduced or modified at any time or from time to time
         pursuant to the terms hereof. The Revolving Committed Amount on the
         Closing Date shall be THREE HUNDRED SEVENTY-FIVE MILLION DOLLARS
         ($375,000,000).

                  "Revolving Loan Commitment" means, as to any Lender, the
         obligation of such Lender to make Revolving Loans hereunder for the
         account of the Borrower in an aggregate principal amount at any one
         time outstanding not to exceed the amount set forth opposite such
         Lender's name on Schedule 1.1(a) hereto, as such amount may be
         increased, reduced or modified at any time or from time to time
         pursuant to the terms hereof.

                  "Revolving Loan Commitment Percentage" means, as to any Lender
         at any time, the ratio of (a) such Lender's Revolving Loan Commitment
         to (b) the Revolving Committed Amount, as such percentage may be
         increased, reduced or modified at any time or from time to time
         pursuant to the terms hereof. The Revolving Loan Commitment Percentage
         for each Lender on the Closing Date shall be as set forth on Schedule
         1.1(a).

                  "Revolving Loans" means the Revolving Loans made to the
         Borrower by the Lenders pursuant to Section 2.1.

                  "Revolving Note" or "Revolving Notes" means the promissory
         notes of the Borrower in favor of each of the Lenders evidencing the
         Revolving Loans provided pursuant to Section 2.1, individually or
         collectively, as appropriate, as such promissory

                                     17

<PAGE>   23

         notes may be amended, modified, supplemented, extended, renewed or
         replaced from time to time and as evidenced in the form of Exhibit
         2.1(f).

                  "RL Maturity Date" has the meaning set forth in Section
         2.5(a).

                  "S&P" means Standard & Poor's Ratings Services, a division of
         The McGraw-Hill Companies, or any successor or assignee of the business
         of such division in the business of rating securities.

                  "Sale and Leaseback Transaction" means a sale or transfer made
         by a Credit Party (except a sale or transfer made from one Credit Party
         to another Credit Party) of any property which is either (a) a
         manufacturing plant, warehouse, office building or model home whose
         book value constitutes 1% or more of Consolidated Net Tangible Assets
         as of the date of determination or (b) any property which is not a
         manufacturing plant, warehouse, office building or model home whose
         book value constitutes 5% or more of Consolidated Net Tangible Assets
         as of the date of determination, if such sale or transfer is made with
         the intention of leasing, or as part of an arrangement involving the
         lease of, such property to the Borrower or a Material Subsidiary.

                  "Securities Act" means the Securities Act of 1933, as amended,
         and the rules and regulations promulgated thereunder.

                  "Single Employer Plan" means any Plan which is covered by
         Title IV of ERISA, but which is not a Multiemployer Plan.

                  "Solvent" means, with respect to each Credit Party as of a
         particular date, that on such date (a) such Credit Party is able to pay
         its debts and other liabilities, contingent obligations and other
         commitments as they mature in the normal course of business, (b) such
         Credit Party does not intend to, and does not believe that it will,
         incur debts or liabilities beyond such Credit Party's ability to pay as
         such debts and liabilities mature in their ordinary course, (c) such
         Credit Party is not engaged in a business or a transaction, and is not
         about to engage in a business or a transaction, for which such Credit
         Party's assets would constitute unreasonably small capital after giving
         due consideration to the prevailing practice in the industry in which
         such Credit Party is engaged or is to engage, (d) the fair value of the
         assets of such Credit Party is greater than the total amount of
         liabilities (excluding (i) letters of credit and surety bonds issued in
         the normal course of business in connection with such Credit Party's
         development activities and (ii) intercompany indebtedness owed to other
         Credit Parties), including, without limitation, contingent liabilities
         of such Credit Party and (e) the present fair saleable value of the
         assets of such Credit Party is not less than the amount that will be
         required to pay the probable liability of such Credit Party on its
         debts as they become absolute and matured. In computing the amount of
         contingent liabilities at any time, it is intended that such
         liabilities will be computed at the amount which, in light of all the
         facts and circumstances existing at such time, represents the amount
         that can reasonably be expected to become an actual or matured
         liability.

                                       18

<PAGE>   24

                  "Subordinated Debt" means any Indebtedness incurred by a
         Credit Party that is subordinated in full to the Loans on subordination
         terms acceptable to the Administrative Agent.

                  "Subsidiary" means, as to any Person, (a) any corporation more
         than 50% of whose stock of any class or classes having by the terms
         thereof ordinary voting power to elect a majority of the directors of
         such corporation (irrespective of whether or not at the time, any class
         or classes of such corporation shall have or might have voting power by
         reason of the happening of any contingency) is at the time owned by
         such Person directly or indirectly through Subsidiaries, and (b) any
         partnership, association, joint venture, limited liability company or
         other entity in which such person directly or indirectly through
         Subsidiaries has more than a 50% equity interest at any time.

                  "Swingline Committed Amount" means FIFTY MILLION DOLLARS
         ($50,000,000).

                  "Swingline Loan Commitment" means, with respect to Bank of
         America, the commitment of Bank of America to make Swingline Loans
         available to the Borrower in the principal amount of up to the
         Swingline Committed Amount.

                  "Swingline Loan Request" means a request by the Borrower for a
         Swingline Loan in substantially the form of Exhibit 2.2(b).

                  "Swingline Loans" means the loans made by Bank of America
         pursuant to Section 2.2.

                  "Swingline Note" means the promissory note of the Borrower in
         favor of Bank of America evidencing the Swingline Loans provided
         pursuant to Section 2.2, as such promissory note may be amended,
         modified, supplemented, extended, renewed or replaced from time to time
         in and as evidenced by the form of Exhibit 2.2(e).

                  "Syndication Agent" means Bank One, NA (or any successor
         thereto).

                  "Tangible Net Worth" means, as of any date, shareholders'
         equity or net worth of the Borrower, as determined in accordance with
         GAAP minus (i) intangibles (as determined in accordance with GAAP) and
         (ii) Investments described in clause (f) of the definition of Permitted
         Investments.

                  "Termination Event" means (a) with respect to any Plan, the
         occurrence of a Reportable Event or the substantial cessation of
         operations (within the meaning of Section 4062(e) of ERISA); (b) the
         withdrawal of any Credit Party or any of its Subsidiaries or any ERISA
         Affiliate from a Multiple Employer Plan during a plan year in which it
         was a substantial employer (as such term is defined in Section
         4001(a)(2) of ERISA), or the termination of a Multiple Employer Plan;
         (c) the distribution of a notice of intent to

                                       19

<PAGE>   25

         terminate or the actual termination of a Plan pursuant to Section
         4041(a)(2) or 4041A of ERISA; (d) the institution of proceedings to
         terminate or the actual termination of a Plan by the PBGC under Section
         4042 of ERISA; (e) any event or condition which might reasonably
         constitute grounds under Section 4042 of ERISA for the termination of,
         or the appointment of a trustee to administer, any Plan; (f) the
         complete or partial withdrawal of any Credit Party or any of its
         Subsidiaries or any ERISA Affiliate from a Multiemployer Plan; or (g)
         the adoption of an amendment to any Plan requiring the provision of
         security to such Plan pursuant to Section 307 of ERISA.

                  "Upfront Fees" means the fees payable to the Lenders pursuant
         to Section 3.4(e).

                  "Utilization Fees" means the fees payable to the Lenders
         pursuant to Section 3.4(b).

                  "Utilized Revolving Committed Amount" means, for any period
         from the Closing Date to the Maturity Date, the amount equal to the
         daily average sum for such period of the aggregate principal amount of
         all Revolving Loans outstanding plus the aggregate amount of all
         Swingline Loans outstanding.

                  "Voting Stock" of a corporation means all classes of the
         Capital Stock of such corporation then outstanding and normally
         entitled to vote in the election of directors.

         1.2      COMPUTATION OF TIME PERIODS AND OTHER DEFINITIONAL PROVISIONS.

         For purposes of computation of periods of time hereunder, the word
"from" means "from and including" and the words "to" and "until" each mean "to
but excluding." References in this Agreement to "Articles", "Sections",
"Schedules" or "Exhibits" shall be to Articles, Sections, Schedules or Exhibits
of or to this Agreement unless otherwise specifically provided.

         1.3      ACCOUNTING TERMS.

         Except as otherwise expressly provided herein, all accounting terms
used herein shall be interpreted, and all financial statements and certificates
and reports as to financial matters required to be delivered to the Lenders
hereunder shall be prepared, in accordance with GAAP applied on a consistent
basis. All calculations made for the purposes of determining compliance with
this Credit Agreement shall (except as otherwise expressly provided herein) be
made by application of GAAP applied on a basis consistent with the most recent
annual or quarterly financial statements delivered pursuant to Section 7.1 (or,
prior to the delivery of the first financial statements pursuant to Section 7.1,
consistent with the financial statements described in Section 5.1(d)); provided,
however, if (a) the Borrower shall object to determining such compliance on such
basis at the time of delivery of such financial statements due to any change in
GAAP or the rules promulgated with respect thereto or (b) the Administrative
Agent or the Required Lenders shall so object in writing within 30 days after
delivery of such financial statements, then such calculations shall be made on a
basis consistent with GAAP as in effect as of the date of the most recent
financial statements delivered by the Borrower to the Lenders to which no such
objection shall have been made.

                                       20

<PAGE>   26

         1.4      TIME.

         All references to time herein shall be references to Eastern Standard
Time or Eastern Daylight Time, as the case may be, unless specified otherwise.

                                    SECTION 2

                                CREDIT FACILITIES

         2.1      REVOLVING LOANS.

                  (a) Revolving Loan Commitment. Subject to the terms and
         conditions set forth herein, each Lender severally agrees to make
         revolving loans (each a "Revolving Loan" and collectively the
         "Revolving Loans") to the Borrower, in Dollars, at any time and from
         time to time, during the period from and including the Effective Date
         to but not including the Maturity Date (or such earlier date if the
         Revolving Committed Amount has been terminated as provided herein);
         provided, however, that (i) the sum of the aggregate amount of
         Revolving Loans outstanding plus the aggregate amount of Swingline
         Loans outstanding plus the aggregate amount of secured Indebtedness
         incurred by the Credit Parties pursuant to Section 8.1(h) in excess of
         $100,000,000 shall not exceed the Revolving Committed Amount and (ii)
         with respect to each individual Lender, the Lender's pro rata share of
         outstanding Revolving Loans plus such Lender's (other than Bank of
         America) pro rata share of outstanding Swingline Loans shall not exceed
         such Lender's Revolving Loan Commitment Percentage of the Revolving
         Committed Amount. Subject to the terms of this Credit Agreement
         (including Section 3.3), the Borrower may borrow, repay and reborrow
         Revolving Loans.

                  (b) Method of Borrowing for Revolving Loans. By no later than
         12:00 noon (i) on the date of the requested borrowing of Revolving
         Loans that will be Base Rate Loans or (ii) three Business Days prior to
         the date of the requested borrowing of Revolving Loans that will be
         Eurodollar Loans, the Borrower shall telephone the Administrative Agent
         with the information described below as well as submit a written Notice
         of Borrowing in the form of Exhibit 2.1(b) (which may be submitted via
         telecopy) to the Administrative Agent setting forth (A) the amount
         requested, (B) whether such Revolving Loans shall accrue interest at
         the Base Rate or the Adjusted Eurodollar Rate, (C) with respect to
         Revolving Loans that will be Eurodollar Loans, the Interest Period
         applicable thereto and (D) certification that the Borrower has complied
         in all respects with Section 5.2. Revolving Loans made on the Effective
         Date may be Base Rate Loans or, subject to compliance by the Borrower
         with the terms of this Section 2.1(b) and delivery by the Borrower to
         the Administrative Agent of a funding indemnity letter in form and
         substance satisfactory to the Administrative Agent, Eurodollar Loans or
         a combination thereof.

                                       21

<PAGE>   27

                  (c) Funding of Revolving Loans. Upon receipt of a Notice of
         Borrowing, the Administrative Agent shall promptly inform the Lenders
         as to the terms thereof. Each Lender shall make its Revolving Loan
         Commitment Percentage of the requested Revolving Loans available to the
         Administrative Agent by 3:00 p.m. on the date specified in the Notice
         of Borrowing by deposit, in Dollars, of immediately available funds at
         the Agency Services Address.

                  No Lender shall be responsible for the failure or delay by any
         other Lender in its obligation to make Revolving Loans hereunder;
         provided, however, that the failure of any Lender to fulfill its
         obligations hereunder shall not relieve any other Lender of its
         obligations hereunder. Unless the Administrative Agent shall have been
         notified by any Lender prior to the date of any such Revolving Loan
         that such Lender does not intend to make available to the
         Administrative Agent its portion of the Revolving Loans to be made on
         such date, the Administrative Agent may assume that such Lender has
         made such amount available to the Administrative Agent on the date of
         such Revolving Loans, and the Administrative Agent in reliance upon
         such assumption, may (in its sole discretion but without any obligation
         to do so) make available to the Borrower a corresponding amount. If
         such corresponding amount is not in fact made available to the
         Administrative Agent, the Administrative Agent shall be able to recover
         such corresponding amount from such Lender. If such Lender does not pay
         such corresponding amount forthwith upon the Administrative Agent's
         demand therefor, the Administrative Agent will promptly notify the
         Borrower, and the Borrower shall immediately pay such corresponding
         amount to the Administrative Agent. The Administrative Agent shall also
         be entitled to recover from the Lender or the Borrower, as the case may
         be, interest on such corresponding amount in respect of each day from
         the date such corresponding amount was made available by the
         Administrative Agent to the Borrower to the date such corresponding
         amount is recovered by the Administrative Agent at a per annum rate
         equal to (i) from the Borrower at the applicable rate for such
         Revolving Loan pursuant to the Notice of Borrowing and (ii) from a
         Lender at the Federal Funds Rate.

                  (d)      Reductions of Revolving Committed Amount.

                           (i) Upon at least three Business Days' notice, the
                  Borrower shall have the right to permanently reduce, without
                  premium or penalty, all or part of the aggregate unused amount
                  of the Revolving Committed Amount at any time or from time to
                  time; provided that (A) each partial reduction shall be in an
                  aggregate amount at least equal to $5,000,000 and in integral
                  multiples of $1,000,000 above such amount and (B) no reduction
                  shall be made which would reduce the Revolving Committed
                  Amount to an amount less than the aggregate amount of
                  Revolving Loans outstanding plus the aggregate amount of
                  Swingline Loans outstanding plus the aggregate amount of
                  secured Indebtedness incurred by the Credit Parties pursuant
                  to Section 8.1(h) in excess of $100,000,000.

                           (ii) On the first anniversary of the Closing Date, if
                  Bank of America has not assigned at least $30,000,000 of its
                  Revolving Loan Commitment to an Eligible

                                       22

<PAGE>   28

                  Assignee, then the Revolving Loan Commitment of Bank of
                  America and the Revolving Committed Amount shall be reduced by
                  an amount equal to the sum of $30,000,000 minus the amount of
                  Bank of America's Revolving Loan Commitment assigned to an
                  Eligible Assignee prior to such date. Notwithstanding anything
                  to the contrary in Section 3.3(c), any such reduction of the
                  Revolving Loan Commitment of Bank of America and the Revolving
                  Committed Amount shall be accompanied by a prepayment (if
                  necessary) of the outstanding Loans of Bank of America in an
                  amount such that, after giving effect to such prepayment, the
                  outstanding Loans of Bank of America shall not exceed its
                  Revolving Loan Commitment, as reduced hereby. Each of the
                  Lenders consents to the foregoing reduction of the Revolving
                  Loan Commitment of Bank of America (and the corresponding
                  prepayment of Bank of America's Loans and reduction of the
                  Revolving Committed Amount) without a pro rata reduction of
                  such Lender's Revolving Loan Commitment (or corresponding
                  prepayment of such Lender's Loans).

                           (iii) Any reduction in (or termination of) the
                  Revolving Committed Amount may not be reinstated without the
                  consent of all the Lenders; provided, however, the Borrower
                  shall still be entitled to increase the Revolving Committed
                  Amount in accordance with the terms of Section 2.1(e). The
                  Administrative Agent shall immediately notify the Lenders of
                  any reduction in the Revolving Committed Amount.

                  (e) Increase of Revolving Committed Amount. Prior to the
         Maturity Date and upon at least 15 days' prior written notice to the
         Administrative Agent (which notice shall be promptly transmitted by the
         Administrative Agent to each Lender), the Borrower shall have the
         right, subject to the terms and conditions set forth below, to increase
         the Revolving Committed Amount; provided that (a) such increase must be
         in a minimum amount of $10,000,000 and in integral multiples of
         $1,000,000 above such amount, (b) the Revolving Committed Amount cannot
         be increased to an aggregate amount greater than the sum of (i) Six
         Hundred Million Dollars ($600,000,000) minus (ii) the aggregate amount
         of all reductions of the Revolving Committed Amount pursuant to Section
         2.1(d), without the prior written consent of the Required Lenders, (c)
         the Borrower shall execute and deliver such Note(s) as are necessary to
         reflect the increase in the Revolving Committed Amount, (d) Schedule
         1.1(a) hereto shall be amended to reflect the revised Revolving
         Committed Amount and aggregate Commitments of the Lenders, (e) if any
         Loans are outstanding at the time of an increase in the Revolving
         Committed Amount, the Borrower will prepay (provided that any such
         prepayment shall be subject to Section 3.14 hereof) one or more
         existing Loans in an amount necessary such that after giving effect to
         the increase in the Revolving Committed Amount each Lender will hold
         its pro rata share (based on its share of the revised aggregate
         Commitments) of outstanding Loans and (f) during the first year
         following the Closing Date, the Revolving Committed Amount cannot be
         increased until Bank of America has assigned at least $30,000,000 of
         its Revolving Loan Commitment to one or more Eligible Assignees.

                                       23

<PAGE>   29

                  Any such increase in the Revolving Committed Amount shall
         apply, at the option of the Borrower, to (i) the Commitment of one or
         more existing Lenders; provided that any Lender whose Commitment is
         being increased must consent in writing thereto and/or (ii) the
         creation of a new Commitment to one or more institutions that is not an
         existing Lender; provided that any such institution must qualify as an
         Eligible Assignee and must become a Lender under this Credit Agreement
         by execution and delivery of an appropriate joinder agreement or of
         counterparts to this Credit Agreement in a manner acceptable to the
         Borrower and the Administrative Agent.

                  (f) Revolving Notes. The Revolving Loans made by each Lender
         shall be evidenced by a duly executed promissory note of the Borrower
         to such Lender in an original principal amount equal to such Lender's
         Revolving Commitment Percentage of the Revolving Committed Amount and
         in substantially the form of Exhibit 2.1(f).

         2.2      SWINGLINE LOANS SUBFACILITY.

                  (a) Swingline Loans. Bank of America hereby agrees, on the
         terms and subject to the conditions set forth herein and in the other
         Credit Documents, to make revolving loans to the Borrower, in Dollars,
         at any time and from time to time during the period from and including
         the Effective Date to but not including the Maturity Date (each such
         loan, a "Swingline Loan" and collectively, the "Swingline Loans");
         provided that (i) the aggregate principal amount of the Swingline Loans
         outstanding at any one time shall not exceed the Swingline Committed
         Amount, and (ii) the aggregate amount of Swingline Loans outstanding
         plus the aggregate amount of Revolving Loans outstanding plus the
         aggregate amount of secured Indebtedness incurred by the Credit
         Parties, pursuant to Section 8.1(h), in excess of $100,000,000 shall
         not exceed the Revolving Committed Amount. Prior to the Maturity Date,
         Swingline Loans may be repaid and reborrowed by the Borrower in
         accordance with the provisions hereof.

                  (b) Method of Borrowing and Funding Swingline Loans. By no
         later than 2:00 p.m. on the date of the requested borrowing of
         Swingline Loans, the Borrower shall provide telephonic notice to Bank
         of America, followed promptly by a written Swingline Loan Request in
         the form of Exhibit 2.2(b) (which may be submitted via telecopy), each
         of such telephonic notice and such written Swingline Loan Request
         setting forth (i) the amount of the requested Swingline Loan (which
         shall not be less than $100,000 and in integral multiples of $50,000 in
         excess thereof), (ii) the date of the requested Swingline Loan, (iii)
         certification that the Borrower has complied in all respects with
         Section 5.2 and (iv) whether such Swingline Loan is to be a Base Rate
         Loan or an Index Rate Swingline Loan and, if such Swingline Loan is to
         be an Index Rate Swingline Loan, the applicable Interest Period. If the
         Borrower has requested an Index Rate Swingline Loan, Bank of America
         shall provide to the Borrower no later than 2:30 p.m. on the date of
         such request the Adjusted LIBOR Market Index Rate. The Borrower shall
         notify Bank of America by 3:00 p.m. on such date whether it wishes to
         accept the Adjusted LIBOR Market Index Rate. Failure of the Borrower to
         timely accept the Adjusted LIBOR Market Index Rate shall make the
         Adjusted LIBOR Market Index Rate and the corresponding Index Rate
         Swingline Loan
                                       24

<PAGE>   30

         void. Bank of America shall initiate the transfer of funds
         representing the Swingline Loan advance to the Borrower by 4:00 p.m. on
         the Business Day of the requested borrowing.

                  (c) Repayment and Participations of Swingline Loans. The
         Borrower agrees to repay all Swingline Loans that are Base Rate Loans
         within one Business Day of demand therefor by Bank of America and all
         Swingline Loans that are Index Rate Swingline Loans at the end of the
         applicable Interest Period; provided that each Swingline Loan shall be
         repaid within seven Business Days from the date of advance. Each
         repayment of a Swingline Loan may be accomplished by requesting
         Revolving Loans, which request is not subject to the conditions set
         forth in Section 5.2. In the event that the Borrower shall fail to
         timely repay any Swingline Loan, and in any event upon (i) the request
         of Bank of America, (ii) the occurrence of an Event of Default
         described in Section 9.1(f) or (iii) the acceleration of any Loan or
         termination of any Commitment pursuant to Section 9.2, each other
         Lender shall irrevocably and unconditionally purchase from Bank of
         America, without recourse or warranty, an undivided interest and
         participation in such Swingline Loan in an amount equal to such other
         Lender's Revolving Loan Commitment Percentage thereof, by directly
         purchasing a participation in such Swingline Loan in such amount
         (regardless of whether the conditions precedent thereto set forth in
         Section 5.2 hereof are then satisfied, whether or not the Borrower has
         submitted a Notice of Borrowing and whether or not the Commitments are
         then in effect, any Event of Default exists or all the Loans have been
         accelerated) and paying the proceeds thereof to Bank of America at the
         Agency Services Address, in Dollars and in immediately available funds.
         If such amount is not in fact made available to Bank of America by any
         Lender, Bank of America shall be entitled to recover such amount on
         demand from such Lender, together with accrued interest thereon (to the
         extent the Borrower fails to pay accrued interest with respect to such
         amount) for each day from the date of demand thereof, at the Federal
         Funds Rate. If such Lender does not pay such amount forthwith upon Bank
         of America's demand therefor, and until such time as such Lender makes
         the required payment, Bank of America shall be deemed to continue to
         have outstanding Swingline Loans in the amount of such unpaid
         participation obligation for all purposes of the Credit Documents other
         than those provisions requiring the other Lenders to purchase a
         participation therein. Further, such Lender shall be deemed to have
         assigned any and all payments made of principal and interest on its
         Loans, and any other amounts due to it hereunder to Bank of America to
         fund Swingline Loans in the amount of the participation in Swingline
         Loans that such Lender failed to purchase pursuant to this Section
         2.2(c) until such amount has been purchased (as a result of such
         assignment or otherwise). On the date the Lenders are required to
         purchase participations in outstanding Swingline Loans pursuant to this
         Section 2.2(c), the outstanding principal amount, including Bank of
         America's pro rata share, of such Swingline Loans shall be deemed to be
         a Revolving Loan accruing interest at the Base Rate.

                  (d) Interest on Swingline Loans. Subject to the provisions of
         Section 3.1, each Swingline Loan shall bear interest at a per annum
         rate equal to the Base Rate or the Adjusted LIBOR Market Index Rate, as
         applicable.

                                       25

<PAGE>   31

                  (e) Swingline  Note.  The Swingline  Loans shall be evidenced
         by a duly executed promissory note of the Borrower to Bank of America
         in the original principal amount of the Swingline Committed Amount and
         in substantially the form of Exhibit 2.2(e).

         2.3      CONTINUATIONS AND CONVERSIONS.

         The Borrower shall have the option, on any Business Day, to continue
existing Eurodollar Loans for a subsequent Interest Period, to convert Base Rate
Loans (other than Swingline Loans) into Eurodollar Loans or to convert
Eurodollar Loans into Base Rate Loans (other than Swingline Loans); provided,
however, that (a) each such continuation or conversion must be requested by the
Borrower pursuant to a written Notice of Continuation/Conversion, in the form of
Exhibit 2.3, in compliance with the terms set forth below, (b) except as
provided in Section 3.11, Eurodollar Loans may only be continued or converted
into Base Rate Loans on the last day of the Interest Period applicable thereto,
(c) Eurodollar Loans may not be continued nor may Base Rate Loans be converted
into Eurodollar Loans during the existence and continuation of a Default or an
Event of Default and (d) any request to continue a Eurodollar Loan that fails to
comply with the terms hereof or any failure to request a continuation of a
Eurodollar Loan at the end of an Interest Period shall constitute a conversion
to a Base Rate Loan on the last day of the applicable Interest Period. Each
continuation or conversion must be requested by the Borrower no later than 12:00
noon (i) on the date for a requested conversion of a Eurodollar Loan to a Base
Rate Loan or (ii) three Business Days prior to the date for a requested
continuation of a Eurodollar Loan or conversion of a Base Rate Loan to a
Eurodollar Loan, in each case pursuant to a written Notice of
Continuation/Conversion submitted to the Administrative Agent which shall set
forth (A) whether the Borrower wishes to continue or convert such Loans and (B)
if the request is to continue a Eurodollar Loan or convert a Base Rate Loan to a
Eurodollar Loan, the Interest Period applicable thereto.

         2.4      MINIMUM AMOUNTS.

         Each request for a borrowing, conversion or continuation shall be
subject to the requirements that (a) each Eurodollar Loan shall be in a minimum
amount of $5,000,000 (and in integral multiples of $1,000,000 in excess
thereof), (b) each Base Rate Loan shall be in a minimum amount of the lesser of
$1,000,000 (and integral multiples of $100,000 in excess thereof) or the
remaining amount available under the Revolving Committed Amount and (c) each
Swingline Loan shall be in a minimum amount of $100,000 (and in integral
multiples of $50,000 in excess thereof) or the remaining amount of the Swingline
Committed Amount. For the purposes of this Section, all Eurodollar Loans with
the same Interest Periods that begin and end on the same date shall be
considered as one Eurodollar Loan, but Eurodollar Loans with different Interest
Periods, even if they begin on the same date, shall be considered as separate
Eurodollar Loans.

         2.5      EXTENSION OF MATURITY DATE.

                  (a) At least 60 days but not more than 75 days prior to each
         annual anniversary of the Closing Date, the Borrower may, by delivering
         a written notice to the

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<PAGE>   32

         Administrative Agent, request that the Maturity Date be extended for
         one additional year. The Administrative Agent shall notify each Lender
         of such request promptly upon its receipt of such notice and shall
         request that each Lender respond to such request by the Borrower within
         ten Business Days of notice thereof. If any Lender does not consent or
         respond to the Borrower's request then such Lender (a "Refusing
         Lender") shall be deemed to have rejected such request. If Lenders
         whose combined Revolving Loan Commitment Percentages equal at least 80%
         (the "Extension Required Lenders"; each Lender agreeing to extend its
         Revolving Loan Commitment is referred to herein as an "Extending
         Lender") timely agree in writing to extend their Revolving Loan
         Commitments, then (i) the Revolving Loan Commitments of the Extending
         Lenders shall without further action be extended for an additional one
         year period, (ii) the term "Maturity Date" shall thenceforth mean, (A)
         as to the Commitments and Loans of the Extending Lenders, the last day
         of such additional one year period and (B) as to the Commitments and
         Loans of the Refusing Lenders, the Maturity Date in effect prior to
         such extension (each a "RL Maturity Date"), (iii) subject to the terms
         of subsection (b) below, the Revolving Loan Commitments of the Refusing
         Lenders shall terminate on the applicable RL Maturity Date and the
         Loans and other amounts owed to such Lenders shall be due and payable
         on such date and (iv) subject to the terms of subsection (b) below, on
         a RL Maturity Date (A) the Revolving Committed Amount shall be reduced
         by an amount equal to the sum of the Revolving Loan Commitments of the
         applicable Refusing Lenders and (B) the Revolving Loan Commitment
         Percentage of the Extending Lenders shall be reallocated, on a pro rata
         basis, so that the sum of such Revolving Loan Commitment Percentages
         equals one hundred percent (100%). If such extension is not approved by
         the Extension Required Lenders, the Maturity Date then in effect will
         be retained.

                  (b) So long as the Extension Required Lenders consent to the
         extension of the Maturity Date in accordance with the terms of Section
         2.5(a):

                           (i) with respect to any Refusing Lender, the Borrower
                  may request, in its own discretion and at its own expense,
                  such Refusing Lender to transfer and assign (and such Refusing
                  Lender shall be required to transfer and assign upon such
                  request) in whole (but not in part), without recourse and in
                  accordance with and subject to the terms of Section 11.3(b),
                  all of its interests, rights and obligations under this Credit
                  Agreement to one or more Eligible Assignees (which may be one
                  or more existing Lenders if any existing Lender accepts such
                  assignment); provided that (A) such assignment or assignments
                  shall not conflict with any law, rule, regulation or order of
                  any court or other Governmental Authority, (B) the Borrower or
                  such Eligible Assignee or Eligible Assignees shall pay to such
                  Refusing Lender in immediately available funds the principal
                  of and interest accrued to the date of such payment on the
                  portion of the Loans hereunder held by such Refusing Lender
                  and all other amounts owed to such Refusing Lender hereunder,
                  as well as any processing fee owing to the Administrative
                  Agent under Section 11.3(b), (C) the maturity date of the
                  Loans transferred to such Eligible Assignee shall be the
                  Maturity Date as extended in accordance with

                                       27

<PAGE>   33

                  Section 2.5(a) above and (D) such transfer and assignment must
                  occur on or prior to the applicable RL Maturity Date; or

                           (ii) the Borrower may (A) notify the Administrative
                  Agent and the Extending Lenders in writing that it wishes to
                  (and each such Extending Lender shall agree to) reduce the
                  Revolving Loan Committed Amount by an amount equal to the sum
                  of the Revolving Loan Commitments of the Refusing Lenders, (B)
                  pay all outstanding Loans of the Refusing Lenders and any
                  other amounts owing to the Refusing Lenders, and terminate the
                  Revolving Loan Commitments of the Refusing Lenders and (C)
                  reallocate the Revolving Loan Commitment Percentage of the
                  Extending Lenders, on a pro rata basis, so that the sum of
                  such Revolving Loan Commitment Percentages equals one hundred
                  percent (100%).

                  (c) The Borrower shall indemnify each Lender (whether an
         Extending Lender or Refusing Lender) for any eurodollar breakage costs
         or expenses incurred by such Lender as a result of any extension of the
         Maturity Date pursuant to this Section 2.5 and any assignment of such
         Lender's Commitments and Loans or any reallocation of such Lender's
         Revolving Loan Commitment Percentage in connection with such extension.

                  (d) Each of the Lenders hereby authorizes the Administrative
         Agent, on their behalf, to enter into an amendment to this Credit
         Agreement (and the Credit Parties hereby agree to enter into any such
         amendment on terms reasonably acceptable to the Credit Parties and the
         Administrative Agent) to effectuate any extension of the Maturity Date,
         reduction of the Revolving Committed Amount, repayment of Loans or
         reallocation of the Revolving Loan Commitment Percentages, in each case
         as expressly contemplated by the terms of this Section 2.5.

                                    SECTION 3

                     GENERAL PROVISIONS APPLICABLE TO LOANS

         3.1      INTEREST.

                  (a) Interest.  Subject to the provisions of Section 3.1(b):

                           (i) Base Rate Loans. During such periods as Loans
                  shall be comprised in whole or in part of Base Rate Loans,
                  such Base Rate Loans shall bear interest at a per annum rate
                  equal to the Base Rate.

                           (ii) Eurodollar Loans. During such periods as Loans
                  shall be comprised in whole or in part of Eurodollar Loans,
                  such Eurodollar Loans shall bear interest at a per annum rate
                  equal to the Adjusted Eurodollar Rate.

                                       28

<PAGE>   34

                           (iii) Swingline Loans.  Swingline Loans shall bear
                  interest in accordance  with the terms of Section 2.2(d).

                  (b) Default Rate of Interest. Upon the occurrence, and during
         the continuance, of an Event of Default, the principal of and, to the
         extent permitted by law, interest on the Loans and any other amounts
         owing hereunder or under the other Credit Documents (including without
         limitation fees and expenses) shall bear interest, payable on demand,
         at a per annum rate equal to 2% plus the rate which would otherwise be
         applicable (or if no rate is applicable, then the rate for Revolving
         Loans that are Base Rate Loans plus two percent (2%) per annum).

                  (c) Interest Payments. Interest on Loans shall be due and
         payable in arrears on each Interest Payment Date. If an Interest
         Payment Date falls on a date which is not a Business Day, such Interest
         Payment Date shall be deemed to be the next succeeding Business Day,
         except that in the case of Eurodollar Loans where the next succeeding
         Business Day falls in the next succeeding calendar month, then such
         Interest Payment Date shall be deemed to be the next preceding Business
         Day.

         3.2      PLACE AND MANNER OF PAYMENTS.

         All payments of principal, interest, fees, expenses and other amounts
to be made by a Credit Party under this Credit Agreement shall be made without
setoff, deduction or counterclaim and received not later than 2:00 p.m. on the
date when due, in Dollars and in immediately available funds, by the
Administrative Agent at the Agency Services Address. Payments received after
such time shall be deemed to have been received on the next Business Day. The
Borrower shall, at the time it makes any payment under this Credit Agreement,
specify to the Administrative Agent the Loans, fees or other amounts payable by
the Borrower hereunder to which such payment is to be applied (and in the event
that it fails to specify, or if such application would be inconsistent with the
terms hereof, the Administrative Agent shall, subject to Section 3.7, distribute
such payment to the Lenders in such manner as the Administrative Agent may deem
appropriate). The Administrative Agent will distribute such payments to the
applicable Lenders on the same Business Day if any such payment is received
prior to 2:00 p.m.; otherwise the Administrative Agent will distribute such
payment to the applicable Lenders on the next succeeding Business Day. Whenever
any payment hereunder shall be stated to be due on a day which is not a Business
Day, the due date thereof shall be extended to the next succeeding Business Day
(subject to accrual of interest and fees for the period of such extension),
except that in the case of Eurodollar Loans, if the extension would cause the
payment to be made in the next following calendar month, then such payment shall
instead be made on the next preceding Business Day.

         3.3      PREPAYMENTS.

                  (a) Voluntary Prepayments. The Borrower shall have the right
         to prepay Loans in whole or in part from time to time without premium
         or penalty; provided, however, that (i) Eurodollar Loans may only be
         prepaid on three Business Days' prior written notice to the
         Administrative Agent and (ii) each such partial prepayment of Loans
         shall be in the

                                       29

<PAGE>   35

         minimum principal amount of (A) $5,000,000 and integral multiples of
         $1,000,000 in excess thereof for Revolving Loans and (B) $100,000 and
         integral multiples of $50,000 in excess thereof for Swingline Loans.
         All prepayments under this Section shall be subject to Section 3.14 and
         be accompanied by interest on the principal amount prepaid through the
         date of prepayment.

                  (b) Mandatory Prepayments. If, at any time, the sum of the
         aggregate amount of Revolving Loans outstanding plus Swingline Loans
         outstanding plus the aggregate amount of secured Indebtedness incurred
         by the Credit Parties, pursuant to Section 8.1(h), in excess of
         $100,000,000 exceeds the Revolving Committed Amount, the Borrower shall
         immediately make a principal payment to the Administrative Agent in the
         manner and in an amount such that the sum of the aggregate amount of
         Revolving Loans outstanding plus Swingline Loans outstanding plus the
         aggregate amount of secured Indebtedness incurred by the Credit
         Parties, pursuant to Section 8.1(h), in excess of $100,000,000 is less
         than or equal to the Revolving Committed Amount (to be applied as set
         forth in Section 3.3(c) below).

                  (c) Application of Prepayments. All amounts required to be
         paid pursuant to Section 3.3(b) shall be applied first to Swingline
         Loans and second to Revolving Loans. Within the parameters of the
         applications set forth above, prepayments shall be applied first to
         Base Rate Loans and then to Eurodollar Loans (or Index Rate Swingline
         Loans, as applicable) in direct order of Interest Period maturities.
         All prepayments hereunder shall be subject to Section 3.14 and shall be
         accompanied by interest on the principal amount prepaid through the
         date of prepayment.

         3.4      FEES.

                  (a) Facility Fees. In consideration of the Revolving Committed
         Amount being made available by the Lenders hereunder, the Borrower
         agrees to pay to the Administrative Agent, for the pro rata benefit of
         each Lender (based on each Lender's Revolving Loan Commitment
         Percentage of the Revolving Committed Amount), a per annum fee equal to
         the Applicable Percentage for Facility Fees multiplied by the Revolving
         Committed Amount (the "Facility Fees"). The Facility Fees shall
         commence to accrue on the Effective Date and shall be due and payable
         in arrears on the first Business Day after the end of each fiscal
         quarter of the Borrower (as well as on the Maturity Date and on any
         date that the Revolving Committed Amount is reduced) for the
         immediately preceding fiscal quarter (or portion thereof), beginning
         with the first of such dates to occur after the Closing Date.

                  (b) Utilization Fees.

                           (i) If, as calculated on the last day of each fiscal
                  quarter of the Borrower (as well as on the Maturity Date and
                  on any date that the Revolving Loan Commitment is reduced),
                  the Utilized Revolving Committed Amount for such fiscal
                  quarter exceeds fifty percent (50%) of the Revolving Committed
                  Amount, then for the pro rata benefit of each Lender, the
                  Borrower agrees to pay to the Administrative

                                       30

<PAGE>   36

                  Agent a per annum fee equal to one-tenth of one percent (.10%)
                  of the Utilized Revolving Committed Amount (the "Utilization
                  Fees").

                           (ii) The Utilization Fees, if any, shall be due and
                  payable in arrears on the first Business Day after the end of
                  each fiscal quarter of the Borrower (as well as on the
                  Maturity Date and on any date that the Revolving Loan
                  Commitment is reduced) for the immediately preceding fiscal
                  quarter (or portion thereof), beginning with the first of such
                  dates to occur after the Closing Date.

                  (c) Administrative Fees. The Borrower agrees to pay to the
         Administrative Agent, for its own account, an annual fee (the
         "Administrative Fees") in accordance with the terms of the Fee Letter.

                  (d) Extension Fee. The Borrower agrees to pay to the
         Administrative Agent for the pro rata benefit of each Extending Lender,
         at the time of any extension of the Maturity Date pursuant to Section
         2.5, such extension fees as are agreed upon among the Borrower, the
         Administrative Agent and such Extending Lenders.

                  (e) Upfront Fees. In consideration of the Revolving Committed
         Amount being made available by the Lenders hereunder, the Borrower
         agrees to pay to each Lender an upfront fee in accordance with the
         terms of the fee letter among such Lender, the Borrower and the
         Administrative Agent (the "Upfront Fees"). The Upfront Fees shall be
         due and payable on or prior to the Effective Date.

         3.5      PAYMENT IN FULL AT MATURITY.

         On the Maturity Date, the entire outstanding principal balance of all
Revolving Loans and Swingline Loans, together with accrued but unpaid interest
and all other sums owing with respect thereto, shall be due and payable in full,
unless accelerated sooner pursuant to Section 9.2.

         3.6      COMPUTATIONS OF INTEREST AND FEES.

                  (a) Except for Base Rate Loans and Swingline Loans, in which
         case interest shall be computed on the basis of a 365 or 366 day year
         as the case may be, all computations of interest and fees hereunder
         shall be made on the basis of the actual number of days elapsed over a
         year of 360 days. Interest shall accrue from and include the date of
         borrowing (or continuation or conversion) but exclude the date of
         payment.

                  (b) It is the intent of the Lenders and the Credit Parties to
         conform to and contract in strict compliance with applicable usury law
         from time to time in effect. All agreements between the Lenders and the
         Borrower are hereby limited by the provisions of this paragraph which
         shall override and control all such agreements, whether now existing or
         hereafter arising and whether written or oral. In no way, nor in any
         event or contingency (including but not limited to prepayment or
         acceleration of the maturity of any obligation), shall the interest
         taken, reserved, contracted for, charged, or received under this Credit

                                       31

<PAGE>   37

         Agreement, under the Notes or otherwise, exceed the maximum nonusurious
         amount permissible under applicable law. If, from any possible
         construction of any of the Credit Documents or any other document,
         interest would otherwise be payable in excess of the maximum
         nonusurious amount, any such construction shall be subject to the
         provisions of this paragraph and such documents shall be automatically
         reduced to the maximum nonusurious amount permitted under applicable
         law, without the necessity of execution of any amendment or new
         document. If any Lender shall ever receive anything of value which is
         characterized as interest on the Loans under applicable law and which
         would, apart from this provision, be in excess of the maximum lawful
         amount, an amount equal to the amount which would have been excessive
         interest shall, without penalty, be applied to the reduction of the
         principal amount owing on the Loans and not to the payment of interest,
         or refunded to the Borrower or the other payor thereof if and to the
         extent such amount which would have been excessive exceeds such unpaid
         principal amount of the Loans. The right to demand payment of the Loans
         or any other Indebtedness evidenced by any of the Credit Documents does
         not include the right to accelerate the payment of any interest which
         has not otherwise accrued on the date of such demand, and the Lenders
         do not intend to charge or receive any unearned interest in the event
         of such demand. All interest paid or agreed to be paid to the Lenders
         with respect to the Loans shall, to the extent permitted by applicable
         law, be amortized, prorated, allocated, and spread throughout the full
         stated term (including any renewal or extension) of the Loans so that
         the amount of interest on account of such Indebtedness does not exceed
         the maximum nonusurious amount permitted by applicable law.

         3.7      PRO RATA TREATMENT.

         Except to the extent otherwise provided herein, each Revolving Loan
borrowing, each payment or prepayment of principal of any Revolving Loan, each
payment of fees (other than the Administrative Fees retained by the
Administrative Agent for its own account), each reduction of the Revolving
Committed Amount, and each conversion or continuation of any Revolving Loan,
shall (except as otherwise provided in Section 3.11) be allocated pro rata among
the relevant Lenders in accordance with the respective Revolving Loan Commitment
Percentages of such Lenders (or, if the Commitments of such Lenders have expired
or been terminated, in accordance with the respective principal amounts of the
outstanding Loans and Participation Interests of such Lenders); provided that,
if any Lender shall have failed to pay its applicable pro rata share of any
Revolving Loan, then any amount to which such Lender would otherwise be entitled
pursuant to this Section 3.7 shall instead be payable to the Administrative
Agent until the share of such Revolving Loan not funded by such Lender has been
repaid; provided further, that in the event any amount paid to any Lender
pursuant to this Section 3.7 is rescinded or must otherwise be returned by the
Administrative Agent, each Lender shall, upon the request of the Administrative
Agent, repay to the Administrative Agent the amount so paid to such Lender, with
interest for the period commencing on the date such payment is returned by the
Administrative Agent until the date the Administrative Agent receives such
repayment at a rate per annum equal to, during the period to but excluding the
date two Business Days after such request, the Federal Funds Rate, and
thereafter, the Base Rate plus two percent (2%) per annum.

                                       32

<PAGE>   38

         3.8      SHARING OF PAYMENTS.

         The Lenders agree among themselves that, except to the extent otherwise
provided herein, in the event that any Lender shall obtain payment in respect of
any Loan or any other obligation owing to such Lender under this Credit
Agreement through the exercise of a right of setoff, banker's lien or
counterclaim, or pursuant to a secured claim under Section 506 of the Bankruptcy
Code or other security or interest arising from, or in lieu of, such secured
claim, received by such Lender under any applicable bankruptcy, insolvency or
other similar law or otherwise, or by any other means, in excess of its pro rata
share of such payment as provided for in this Credit Agreement, such Lender
shall promptly pay in cash or purchase from the other Lenders a participation in
such Loans and other obligations in such amounts, and make such other
adjustments from time to time, as shall be equitable to the end that all Lenders
share such payment in accordance with their respective ratable shares as
provided for in this Credit Agreement. The Lenders further agree among
themselves that if payment to a Lender obtained by such Lender through the
exercise of a right of setoff, banker's lien, counterclaim or other event as
aforesaid shall be rescinded or must otherwise be restored, each Lender which
shall have shared the benefit of such payment shall, by payment in cash or a
repurchase of a participation theretofore sold, return its share of that benefit
(together with its share of any accrued interest payable with respect thereto)
to each Lender whose payment shall have been rescinded or otherwise restored.
The Borrower agrees that any Lender so purchasing such a participation may, to
the fullest extent permitted by law, exercise all rights of payment, including
setoff, banker's lien or counterclaim, with respect to such participation as
fully as if such Lender were a holder of such Loan or other obligation in the
amount of such participation. Except as otherwise expressly provided in this
Credit Agreement, if any Lender or the Administrative Agent shall fail to remit
to the Administrative Agent or any other Lender an amount payable by such Lender
or such Administrative Agent to such Administrative Agent or such other Lender
pursuant to this Credit Agreement on the date when such amount is due, such
payments shall be made together with interest thereon for each date from the
date such amount is due until the date such amount is paid to such
Administrative Agent or such other Lender at a rate per annum equal to the
Federal Funds Rate. If under any applicable bankruptcy, insolvency or other
similar law, any Lender receives a secured claim in lieu of a setoff to which
this Section 3.8 applies, such Lender shall, to the extent practicable, exercise
its rights in respect of such secured claim in a manner consistent with the
rights of the Lenders under this Section 3.8 to share in the benefits of any
recovery on such secured claim.

         3.9      CAPITAL ADEQUACY.

         If, after the date hereof, any Lender has determined that the adoption
or the becoming effective of, or any change in, or any change by any
Governmental Authority, central bank or comparable agency charged with the
interpretation or administration thereof in the interpretation or administration
of, any applicable law, rule or regulation regarding capital adequacy, or
compliance by such Lender, or its parent corporation, with any request or
directive regarding capital adequacy (whether or not having the force of law) of
any such authority, central bank or comparable agency, has or would have the
effect of reducing the rate of return on such Lender's (or parent corporation's)
capital or assets as a consequence of its commitments or obligations hereunder
to a level below that which such Lender, or its parent corporation, could have
achieved but for such adoption,

                                       33

<PAGE>   39

effectiveness, change or compliance (taking into consideration such Lender's (or
parent corporation's) policies with respect to capital adequacy), then, upon
written notice from such Lender to the Borrower, the Borrower shall be obligated
to pay to such Lender such additional amount or amounts as will compensate such
Lender on an after-tax basis (after taking into account applicable deductions
and credits in respect of the amount indemnified) for such reduction. Each such
written notice of a determination by any such Lender of amounts owing under this
Section 3.9 shall set forth and certify in reasonable detail the basis for such
determination and the calculation of amounts so owing, which certification
shall, absent manifest error, be conclusive and binding on the parties hereto.
Notwithstanding anything to the contrary contained herein, the Borrower shall
not be required to make any payments to any Lender or the Administrative Agent
pursuant to this Section 3.9 relating to any period of time which is greater
than 90 days prior to such Person's request for additional payment except for
retroactive application of such law, rule or regulation, in which case the
Borrower is required to make such payments so long as such Person makes a
request therefor within 90 days after the public announcement of such
retroactive application. This covenant shall survive the termination of this
Credit Agreement and the payment of the Loans and all other amounts payable
hereunder.

         3.10     INABILITY TO DETERMINE INTEREST RATE.

         If prior to the first day of any Interest Period, the Administrative
Agent shall have determined in good faith (which determination shall be
conclusive and binding upon the Borrower) that, by reason of circumstances
affecting the relevant market, adequate and reasonable means do not exist for
ascertaining the Eurodollar Rate for such Interest Period, the Administrative
Agent shall give telecopy or telephonic notice thereof to the Borrower and the
Lenders as soon as practicable thereafter, and will also give prompt written
notice to the Borrower when such conditions no longer exist. If such notice is
given (a) any Eurodollar Loans requested to be made on the first day of such
Interest Period shall be made as Base Rate Loans and (b) any Loans that were to
have been converted on the first day of such Interest Period to or continued as
Eurodollar Loans shall be converted to or continued as Base Rate Loans. Until
such notice is withdrawn by the Administrative Agent, no further Eurodollar
Loans shall be made or continued as such, nor shall the Borrower have the right
to convert Base Rate Loans to Eurodollar Loans.

         3.11     ILLEGALITY.

         Notwithstanding any other provision herein, if the adoption of or any
change in any Requirement of Law or in the interpretation or application thereof
occurring after the Closing Date shall make it unlawful for any Lender to make
or maintain Eurodollar Loans as contemplated by this Credit Agreement, (a) such
Lender shall promptly give written notice of such circumstances to the Borrower
and the Administrative Agent (which notice shall be withdrawn whenever such
circumstances no longer exist), (b) the commitment of such Lender hereunder to
make Eurodollar Loans, continue Eurodollar Loans as such and convert a Base Rate
Loan to Eurodollar Loans shall forthwith be canceled and, until such time as it
shall no longer be unlawful for such Lender to make or maintain Eurodollar
Loans, such Lender shall then have a commitment only to make a Base Rate Loan
when a Eurodollar Loan is requested and (c) such Lender's Loans then outstanding
as Eurodollar Loans, if any, shall be converted automatically to Base Rate Loans
on the respective last

                                       34

<PAGE>   40

days of the then current Interest Periods with respect to such Loans or within
such earlier period as required by law. If any such conversion of a Eurodollar
Loan occurs on a day which is not the last day of the then current Interest
Period with respect thereto, the Borrower shall pay to such Lender such amounts,
if any, as may be required pursuant to Section 3.14.

         3.12     REQUIREMENTS OF LAW.

         If the adoption of or any change in any Requirement of Law or in the
interpretation or application thereof applicable to any Lender, or compliance by
any Lender with any request or directive (whether or not having the force of
law) from any central bank or other Governmental Authority, in each case made
subsequent to the Closing Date (or, if later, the date on which such Lender
becomes a Lender):

                  (a) shall subject such Lender to any tax of any kind
         whatsoever with respect to any Eurodollar Loans made by it or its
         obligation to make Eurodollar Loans, or change the basis of taxation of
         payments to such Lender in respect thereof (except for Non-Excluded
         Taxes covered by Section 3.13 (including Non-Excluded Taxes imposed
         solely by reason of any failure of such Lender to comply with its
         obligations under Section 3.13(b)) and changes in taxes measured by or
         imposed upon the overall net income, or franchise tax (imposed in lieu
         of such net income tax), of such Lender or its applicable lending
         office, branch, or any affiliate thereof);

                  (b) shall impose, modify or hold applicable any reserve,
         special deposit, compulsory loan or similar requirement against assets
         held by, deposits or other liabilities in or for the account of,
         advances, loans or other extensions of credit by, or any other
         acquisition of funds by, any office of such Lender which is not
         otherwise included in the determination of the Eurodollar Rate
         hereunder; or

                  (c) shall impose on such Lender any other condition (excluding
         any  tax of any  kind whatsoever);

and the result of any of the foregoing is to increase the cost to such Lender,
by an amount which such Lender deems to be material, of making, converting into,
continuing or maintaining Eurodollar Loans or to reduce any amount receivable
hereunder in respect thereof, then, in any such case, upon notice to the
Borrower from such Lender, through the Administrative Agent, in accordance
herewith, the Borrower shall be obligated to promptly pay such Lender, upon its
demand, any additional amounts necessary to compensate such Lender on an
after-tax basis (after taking into account applicable deductions and credits in
respect of the amount indemnified) for such increased cost or reduced amount
receivable, provided that, in any such case, the Borrower may elect to convert
the Eurodollar Loans made by such Lender hereunder to Base Rate Loans by giving
the Administrative Agent at least one Business Day's notice of such election, in
which case the Borrower shall promptly pay to such Lender, upon demand, without
duplication, such amounts, if any, as may be required pursuant to Section 3.14.
If any Lender becomes entitled to claim any additional amounts pursuant to this
Section 3.12, it shall provide prompt written notice thereof to the Borrower,
through the Administrative Agent, certifying (x) that one of the events
described in

                                       35

<PAGE>   41

this Section 3.12 has occurred and describing in reasonable detail the nature of
such event, (y) as to the increased cost or reduced amount resulting from such
event and (z) as to the additional amount demanded by such Lender and a
reasonably detailed explanation of the calculation thereof. Such a certificate
as to any additional amounts payable pursuant to this Section 3.12 submitted by
such Lender, through the Administrative Agent, to the Borrower shall be
conclusive and binding on the parties hereto in the absence of manifest error.
This covenant shall survive the termination of this Credit Agreement and the
payment of the Loans and all other amounts payable hereunder. Notwithstanding
anything to the contrary contained herein, the Borrower shall not be required to
make any payments to any Lender or the Administrative Agent pursuant to this
Section relating to any period of time which is greater than 90 days prior to
such Person's request for additional payment except for retroactive application
of such law, rule or regulation, in which case the Borrower is required to make
such payments so long as such Person makes a request therefor within 90 days
after the public announcement of such retroactive application.

         3.13     TAXES.

                  (a) Except as provided below in this Section 3.13, all
payments made by the Borrower under this Credit Agreement and any Notes shall be
made free and clear of, and without deduction or withholding for or on account
of, any present or future income, stamp or other taxes, levies, imposts, duties,
charges, fees, deductions or withholdings, now or hereafter imposed, levied,
collected, withheld or assessed by any court, or governmental body, agency or
other official, excluding taxes measured by or imposed upon the net income of
any Lender or its applicable lending office, or any branch or affiliate thereof,
and all franchise taxes, branch taxes, taxes on doing business or taxes on the
capital or net worth of any Lender or its applicable lending office, or any
branch or affiliate thereof, in each case imposed in lieu of net income taxes:
(i) by the jurisdiction under the laws of which such Lender, applicable lending
office, branch or affiliate is organized or is located, or in which its
principal executive office is located, or any nation within which such
jurisdiction is located or any political subdivision thereof; or (ii) by reason
of any connection between the jurisdiction imposing such tax and such Lender,
applicable lending office, branch or affiliate other than a connection arising
solely from such Lender having executed, delivered or performed its obligations,
or received payment under or enforced, this Credit Agreement or any Notes. If
any such non-excluded taxes, levies, imposts, duties, charges, fees, deductions
or withholdings ("Non-Excluded Taxes") are required to be withheld from any
amounts payable to the Administrative Agent or any Lender hereunder or under any
Notes, (A) the amounts so payable to the Administrative Agent or such Lender
shall be increased to the extent necessary to yield to the Administrative Agent
or such Lender (after payment of all Non-Excluded Taxes) interest or any such
other amounts payable hereunder at the rates or in the amounts specified in this
Credit Agreement and any Notes, provided, however, that the Borrower shall be
entitled to deduct and withhold any Non-Excluded Taxes and shall not be required
to increase any such amounts payable to any Lender that is not organized under
the laws of the United States of America or a state thereof if such Lender fails
to comply with the requirements of paragraph (b) of this Section 3.13 whenever
any Non-Excluded Taxes are payable by the Borrower, and (B) as promptly as
possible after requested the Borrower shall send to such Administrative Agent
for its own account or for

                                       36
<PAGE>   42
         the account of such Lender, as the case may be, a certified copy of an
         original official receipt received by the Borrower showing payment
         thereof. If the Borrower fails to pay any Non-Excluded Taxes when due
         to the appropriate taxing authority or fails to remit to the
         Administrative Agent the required receipts or other required
         documentary evidence, the Borrower shall indemnify the Administrative
         Agent and any Lender for any incremental Non-Excluded Taxes, interest
         or penalties that may become payable by the Administrative Agent or any
         Lender as a result of any such failure. The agreements in this
         subsection shall survive the termination of this Credit Agreement and
         the payment of the Loans and all other amounts payable hereunder.

                  (b) Each Lender that is not incorporated under the laws of the
         United States of America or a state thereof shall:

                           (i) (A) on or before the date of any payment by the
                  Borrower under this Credit Agreement or Notes to such Lender,
                  deliver to the Borrower and the Administrative Agent (x) two
                  duly completed copies of United States Internal Revenue
                  Service Form 1001 or 4224, or successor applicable form, as
                  the case may be, certifying that it is entitled to receive
                  payments under this Credit Agreement and any Notes without
                  deduction or withholding of any United States federal income
                  taxes and (y) an Internal Revenue Service Form W-8 or W-9, or
                  successor applicable form, as the case may be, certifying that
                  it is entitled to an exemption from United States backup
                  withholding tax;

                               (B) deliver to the Borrower and the
                  Administrative Agent two further copies of any such form or
                  certification on or before the date that any such form or
                  certification expires or becomes obsolete and after the
                  occurrence of any event requiring a change in the most recent
                  form previously delivered by it to the Borrower; and

                               (C) obtain such extensions of time for filing and
                  complete such forms or certifications as may reasonably be
                  requested by the Borrower or the Administrative Agent; or

                           (ii) in the case of any such Lender that is not a
                  "bank" within the meaning of Section 881(c)(3)(A) of the
                  Internal Revenue Code, (A) represent to the Borrower (for the
                  benefit of the Borrower and the Administrative Agent) that it
                  is not a bank within the meaning of Section 881(c)(3)(A) of
                  the Internal Revenue Code, (B) agree to furnish to the
                  Borrower, on or before the date of any payment by the
                  Borrower, with a copy to the Administrative Agent, two
                  accurate and complete original signed copies of Internal
                  Revenue Service Form W-8, or successor applicable form
                  certifying to such Lender's legal entitlement at the date of
                  such certificate to an exemption from U.S. withholding tax
                  under the provisions of Section 881(c) of the Internal Revenue
                  Code with respect to payments to be made under this Credit
                  Agreement and any Notes (and to deliver to the Borrower and
                  the Administrative Agent two further copies of such form on or
                  before the date it

                                       37
<PAGE>   43

                  expires or becomes obsolete and after the occurrence of any
                  event requiring a change in the most recently provided form
                  and, if necessary, obtain any extensions of time reasonably
                  requested by the Borrower or the Administrative Agent for
                  filing and completing such forms), and (C) agree, to the
                  extent legally entitled to do so, upon reasonable request by
                  the Borrower, to provide to the Borrower (for the benefit of
                  the Borrower and the Administrative Agent) such other forms as
                  may be reasonably required in order to establish the legal
                  entitlement of such Lender to an exemption from withholding
                  with respect to payments under this Credit Agreement and any
                  Notes.

         Notwithstanding the above, if any change in treaty, law or regulation
         has occurred after the date such Person becomes a Lender hereunder
         which renders all such forms inapplicable or which would prevent such
         Lender from duly completing and delivering any such form with respect
         to it and such Lender so advises the Borrower and the Administrative
         Agent, then such Lender shall be exempt from such requirements. Each
         Person that shall become a Lender or a participant of a Lender pursuant
         to Section 11.3 shall, upon the effectiveness of the related transfer,
         be required to provide all of the forms, certifications and statements
         required pursuant to this subsection (b); provided that in the case of
         a participant of a Lender, the obligations of such participant of a
         Lender pursuant to this subsection (b) shall be determined as if the
         participant of a Lender were a Lender except that such participant of a
         Lender shall furnish all such required forms, certifications and
         statements to the Lender from which the related participation shall
         have been purchased.

         3.14     COMPENSATION.

         The Borrower promises to indemnify each Lender and to hold each Lender
harmless from any loss or expense which such Lender may sustain or incur as a
consequence of (a) default by the Borrower in making a borrowing of, conversion
into or continuation of Eurodollar Loans after the Borrower has given a notice
requesting the same in accordance with the provisions of this Credit Agreement,
(b) default by the Borrower in making any prepayment of a Eurodollar Loan after
the Borrower has given a notice thereof in accordance with the provisions of
this Credit Agreement and (c) the making of a prepayment of Eurodollar Loans on
a day which is not the last day of an Interest Period with respect thereto. Such
indemnification may include an amount equal to (i) the amount of interest which
would have accrued on the amount so prepaid, or not so borrowed, converted or
continued, for the period from the date of such prepayment or of such failure to
borrow, convert or continue to the last day of the applicable Interest Period
(or, in the case of a failure to borrow, convert or continue, the Interest
Period that would have commenced on the date of such failure) in each case at
the applicable rate of interest for such Eurodollar Loans provided for herein
(excluding, however, the Applicable Percentage included therein, if any) minus
(ii) the amount of interest (as reasonably determined by such Lender) which
would have accrued to such Lender on such amount by placing such amount on
deposit for a comparable period with leading banks in the interbank Eurodollar
market. The agreements in this Section shall survive the termination of this
Credit Agreement and the payment of the Loans and all other amounts payable
hereunder.

                                       38
<PAGE>   44

         3.15     SUBSTITUTION OF LENDER.

         If (a) the obligation of any Lender to make Eurodollar Loans has been
suspended pursuant to Section 3.11 or (b) any Lender has demanded compensation
under Section 3.9, 3.11, 3.12, 3.13 or 3.14, the Borrower shall have the right,
with the assistance of the Administrative Agent, to seek a mutually satisfactory
substitute lender or lenders. Any substitution under this Section 3.15 may be
accomplished, at the Borrower's option, either (i) by the replaced Lender
assigning its rights and obligations hereunder to a replacement lender or
lenders pursuant to Section 11.3(b) at a mutually agreeable price or (ii) by the
Borrower's prepaying all outstanding Loans from the replaced Lender and
terminating such Lender's Commitment on a date specified in a notice delivered
to the Administrative Agent and the replaced Lender at least three Business Days
before the date so specified (and compensating such Lender for any resulting
funding losses as provided in Section 3.14 but otherwise without premium or
penalty) and concurrently a replacement Lender or Lenders assuming a Commitment
in an amount equal to the Commitment being terminated and making Loans in the
same aggregate amount and having the same maturity date or dates, respectively,
as the Loans being prepaid, all pursuant to documents reasonably satisfactory to
the Administrative Agent (and in the case of any document to be signed by the
replaced Lender, reasonably satisfactory to such Lender). No such substitution
shall relieve the Borrower of its obligations to compensate and/or indemnify the
replaced Lender as required by Section 3.9, 3.11, 3.12, 3.13 or 3.14 with
respect to the period before it is replaced and to pay all accrued interest,
accrued fees and other amounts owing to the replaced Lender hereunder.

         3.16     EVIDENCE OF DEBT.

         (a) Each Lender shall maintain an account or accounts evidencing each
Loan made by such Lender to the Borrower from time to time, including the
amounts of principal and interest payable and paid to such Lender from time to
time under this Credit Agreement. Each Lender will make reasonable efforts to
maintain the accuracy of its account or accounts and to promptly update its
account or accounts from time to time, as necessary.

         (b) The Administrative Agent shall maintain the Register pursuant to
Section 11.3(c), and a subaccount for each Lender, in which Register and
subaccounts (taken together) shall be recorded (i) the amount, type and Interest
Period of each such Loan hereunder, (ii) the amount of any principal or interest
due and payable or to become due and payable to each Lender hereunder, and (iii)
the amount of any sum received by the Administrative Agent hereunder from or for
the account of the Borrower and each Lender's share thereof, if any. The
Administrative Agent will make reasonable efforts to maintain the accuracy of
the subaccounts referred to in the preceding sentence and to promptly update
such subaccounts from time to time, as necessary.

         (c) The entries made in the accounts, Register and subaccounts
maintained pursuant to subsection (b) of this Section 3.16 (and, if consistent
with the entries of the Administrative Agent, subsection (a)) shall be prima
facie evidence of the existence and amounts of the obligations of the Borrower
therein recorded; provided, however, that the failure of any Lender or the
Administrative Agent to maintain such account, such Register, or such
subaccount, as

                                       39
<PAGE>   45

applicable, or any error therein, shall not in any manner affect the obligation
of the Borrower to repay the Loans made by such Lender in accordance with the
terms hereof.

                                    SECTION 4

                                    GUARANTY

         4.1      GUARANTY OF PAYMENT.

         Subject to Section 4.7 below, each of the Guarantors hereby, jointly
and severally, unconditionally guarantees to each Lender and the Administrative
Agent the prompt payment of the Credit Party Obligations in full when due
(whether at stated or extended maturity, as a mandatory prepayment, by
acceleration or otherwise). This Guaranty is a guaranty of payment and not of
collection and is a continuing guaranty and shall apply to all Credit Party
Obligations whenever arising.

         4.2      OBLIGATIONS UNCONDITIONAL.

         The obligations of the Guarantors hereunder are absolute and
unconditional, irrespective of the value, genuineness, validity, regularity or
enforceability of any of the Credit Documents or the Hedging Agreements, or any
other agreement or instrument referred to therein, to the fullest extent
permitted by applicable law, irrespective of any other circumstance whatsoever
which might otherwise constitute a legal or equitable discharge or defense of a
surety or guarantor. Each Guarantor agrees that this Guaranty may be enforced by
the Lenders without the necessity at any time of resorting to or exhausting any
other security or collateral and without the necessity at any time of having
recourse to the Notes or any other of the Credit Documents or any collateral, if
any, hereafter securing the Credit Party Obligations or otherwise and each
Guarantor hereby waives the right to require the Lenders to proceed against the
Borrower or any other Person (including a co-guarantor) or to require the
Lenders to pursue any other remedy or enforce any other right. Each Guarantor
further agrees that it shall have no right of subrogation, indemnity,
reimbursement or contribution against the Borrower or any other Guarantor of the
Credit Party Obligations for amounts paid under this Guaranty until such time as
the Lenders (and any Affiliates of Lenders entering into Hedging Agreements)
have been paid in full, all Commitments under the Credit Agreement have been
terminated and no Person or Governmental Authority shall have any right to
request any return or reimbursement of funds from the Lenders in connection with
monies received under the Credit Documents. Each Guarantor further agrees that
nothing contained herein shall prevent the Lenders from suing on the Notes or
any of the other Credit Documents or any of the Hedging Agreements or
foreclosing its security interest in or Lien on any collateral, if any, securing
the Credit Party Obligations or from exercising any other rights available to it
under this Credit Agreement, the Notes, any other of the Credit Documents, or
any other instrument of security, if any, and the exercise of any of the
aforesaid rights and the completion of any foreclosure proceedings shall not
constitute a discharge of any Guarantor's obligations hereunder; it being the
purpose and intent of each Guarantor that its obligations hereunder shall be
absolute, independent and unconditional under any and all circumstances. Neither
any Guarantor's obligations under this

                                       40
<PAGE>   46

Guaranty nor any remedy for the enforcement thereof shall be impaired, modified,
changed or released in any manner whatsoever by an impairment, modification,
change, release or limitation of the liability of the Borrower or by reason of
the bankruptcy or insolvency of the Borrower. Each Guarantor waives any and all
notice of the creation, renewal, extension or accrual of any of the Credit Party
Obligations and notice of or proof of reliance of by the Administrative Agent or
any Lender upon this Guaranty or acceptance of this Guaranty. The Credit Party
Obligations, and any of them, shall conclusively be deemed to have been created,
contracted or incurred, or renewed, extended, amended or waived, in reliance
upon this Guaranty. All dealings between the Borrower and any of the Guarantors,
on the one hand, and the Administrative Agent and the Lenders, on the other
hand, likewise shall be conclusively presumed to have been had or consummated in
reliance upon this Guaranty. The Guarantors further agree to all rights of
set-off as set forth in Section 11.2.

         4.3      MODIFICATIONS.

         Each Guarantor agrees that (a) the time or place of payment of the
Credit Party Obligations may be changed or extended, in whole or in part, to a
time certain or otherwise, and may be renewed or accelerated, in whole or in
part; (b) the Borrower and any other party liable for payment under the Credit
Documents may be granted indulgences generally; (c) any of the provisions of the
Notes or any of the other Credit Documents may be modified, amended or waived;
(d) any party (including any co-guarantor) liable for the payment thereof may be
granted indulgences or be released; (e) the Maturity Date may be extended; and
(f) any deposit balance for the credit of the Borrower or any other party liable
for the payment of the Credit Party Obligations or liable upon any security
therefor may be released, in whole or in part, at, before or after the stated,
extended or accelerated maturity of the Credit Party Obligations, all without
notice to or further assent by such Guarantor, which shall remain bound thereon,
notwithstanding any such exchange, compromise, surrender, extension, renewal,
acceleration, modification, indulgence or release.

         4.4      WAIVER OF RIGHTS.

         Each Guarantor expressly waives to the fullest extent permitted by
applicable law: (a) notice of acceptance of this Guaranty by the Lenders and of
all extensions of credit to the Borrower by the Lenders; (b) presentment and
demand for payment or performance of any of the Credit Party Obligations; (c)
protest and notice of dishonor or of default (except as specifically required in
the Credit Agreement) with respect to the Credit Party Obligations or with
respect to any security therefor; (d) notice of the Lenders obtaining, amending,
substituting for, releasing, waiving or modifying any security interest, lien or
encumbrance, if any, hereafter securing the Credit Party Obligations, or the
Lenders' subordinating, compromising, discharging or releasing such security
interests, liens or encumbrances, if any; (e) all other notices to which such
Guarantor might otherwise be entitled; and (f) demand for payment under this
Guaranty.

         4.5      REINSTATEMENT.

         The obligations of the Guarantors under this Section 4 shall be
automatically reinstated if and to the extent that for any reason any payment by
or on behalf of any Person in respect of the Credit Party Obligations is
rescinded or must be otherwise restored by any holder of any of the

                                       41
<PAGE>   47

Credit Party Obligations, whether as a result of any proceedings in bankruptcy
or reorganization or otherwise, and each Guarantor agrees that it will indemnify
the Administrative Agent and each Lender on demand for all reasonable costs and
expenses (including, without limitation, reasonable fees of counsel) incurred by
the Administrative Agent or such Lender in connection with such rescission or
restoration, including any such costs and expenses incurred in defending against
any claim alleging that such payment constituted a preference, fraudulent
transfer or similar payment under any bankruptcy, insolvency or similar law.

         4.6      REMEDIES.

         The Guarantors agree that, as between the Guarantors, on the one hand,
and the Administrative Agent and the Lenders, on the other hand, the Credit
Party Obligations may be declared to be forthwith due and payable as provided in
Section 9 (and shall be deemed to have become automatically due and payable in
the circumstances provided in Section 9) notwithstanding any stay, injunction or
other prohibition preventing such declaration (or preventing such Credit Party
Obligations from becoming automatically due and payable) as against any other
Person and that, in the event of such declaration (or such Credit Party
Obligations being deemed to have become automatically due and payable), such
Credit Party Obligations (whether or not due and payable by any other Person)
shall forthwith become due and payable by the Guarantors.

         4.7      LIMITATION OF GUARANTY.

         Notwithstanding any provision to the contrary contained herein or in
any of the other Credit Documents, to the extent the obligations of any
Guarantor shall be adjudicated to be invalid or unenforceable for any reason
(including, without limitation, because of any applicable state or federal law
relating to fraudulent conveyances or transfers) then the obligations of such
Guarantor hereunder shall be limited to the maximum amount that is permissible
under applicable law (whether federal or state and including, without
limitation, the Bankruptcy Code).

         4.8      RIGHTS OF CONTRIBUTION.

         The Credit Parties agree among themselves that, in connection with
payments made hereunder, each Credit Party shall have contribution rights
against the other Credit Parties as permitted under applicable law. Such
contribution rights shall be subordinate and subject in right of payment to the
obligations of the Credit Parties under the Credit Documents and no Credit Party
shall exercise such rights of contribution until all Credit Party Obligations
have been paid in full and the Commitments terminated.

                                       42
<PAGE>   48

                                    SECTION 5

                              CONDITIONS PRECEDENT

         5.1      CLOSING CONDITIONS.

         The obligation of the Lenders to enter into this Credit Agreement and
make the initial Extension of Credit is subject to satisfaction (or waiver by
each of the Lenders) of the following conditions:

                  (a) Executed Credit Documents. Receipt by the Administrative
         Agent of duly executed copies of: (i) this Credit Agreement; (ii) the
         Notes and (iii) all other Credit Documents, each in form and substance
         reasonably acceptable to the Administrative Agent and the Lenders;
         provided that receipt by the Administrative Agent of an executed
         signature page to this Credit Agreement from a Lender shall be deemed
         approval by such Lender of the form and substance of the Credit
         Documents.

                  (b) Authority Documents.

                           (i) Partnership Documents. With respect to each
                  Credit Party that is a partnership or limited liability
                  partnership (for the purposes hereof, each a "Partnership"),
                  receipt by the Administrative Agent of the following:

                                    (A) Authorization. Authorization of the
                           general partner(s) of such Partnership, as of the
                           Closing Date, approving and adopting the Credit
                           Documents to be executed by such Partnership and
                           authorizing the execution and delivery thereof.

                                    (B) Partnership Agreements. Certified copies
                           of the partnership agreement of such Partnership,
                           together with all amendments thereto.

                                    (C) Certificates of Good Standing or
                           Existence. Certificate of good standing or existence
                           for such Partnership, issued as of a recent date by
                           its state of organization and each other state where
                           the failure to qualify or be in good standing would
                           have or could be reasonably expected to have a
                           Material Adverse Effect.

                                    (D) Incumbency. An incumbency certificate of
                           the general partner(s) of such Partnership certified
                           by a secretary or assistant secretary of such general
                           partner to be true and correct as of the Closing
                           Date.

                           (ii) Corporate Documents. With respect to each Credit
                  Party that is a corporation, (for the purposes hereof, each a
                  "Corporation"), and with respect to each corporate entity
                  acting, directly or indirectly, on behalf of a Credit Party
                  that is a partnership, limited liability partnership or
                  limited liability company (for the

                                       43
<PAGE>   49

                  purposes of this clause (ii), each a "Managing Person"),
                  receipt by the Administrative Agent of the following:

                                    (A) Charter Documents. Copies of the
                           articles or certificates of incorporation or other
                           charter documents of each such Corporation or
                           Managing Person, as applicable, certified to be true
                           and complete as of a recent date by the appropriate
                           Governmental Authority of the state or other
                           jurisdiction of its incorporation and certified by a
                           secretary or assistant secretary of such Corporation
                           or Managing Person, as applicable, to be true and
                           correct as of the Closing Date.

                                    (B) Bylaws. A copy of the bylaws of each
                           such Corporation or Managing Person, as applicable,
                           certified by a secretary or assistant secretary of
                           such Corporation or Managing Person, as applicable,
                           to be true and correct as of the Closing Date.

                                    (C) Resolutions. Copies of resolutions of
                           such Corporation's board of directors approving and
                           adopting the Credit Documents to which it or the
                           Person for whom it is acting is a party and the
                           transactions contemplated therein and authorizing
                           execution and delivery thereof, certified by a
                           secretary or assistant secretary of such Corporation
                           or Managing Person, as applicable, to be true and
                           correct and in full force and effect as of the
                           Closing Date.

                                    (D) Good Standing. Copies of (A)
                           certificates of good standing, existence or their
                           equivalent with respect to such Corporation or
                           Managing Person, as applicable, certified as of a
                           recent date by the appropriate Governmental
                           Authorities of the state or other jurisdiction of
                           incorporation and each other jurisdiction in which
                           the failure to so qualify and be in good standing
                           would have or could be reasonably expected to have a
                           Material Adverse Effect and (B) to the extent
                           available, a certificate indicating payment of all
                           corporate franchise taxes certified as of a recent
                           date by the appropriate governmental taxing
                           authorities.

                                    (E) Incumbency. An incumbency certificate of
                           such Corporation or Managing Person, as applicable,
                           certified by an officer of such Corporation or
                           Managing Person, as applicable, to be true and
                           correct as of the Closing Date.

                           (iii) Limited Liability Company Documents. With
                  respect to each Credit Party that is a limited liability
                  company (for the purposes hereof, each an "LLC") and with
                  respect to any limited liability company acting, directly or
                  indirectly, on behalf of a Credit Party (for the purposes of
                  this clause (iii), each a "Managing Person"), receipt by the
                  Administrative Agent of the following:

                                       44
<PAGE>   50

                                    (A) Certificate of Formation. A copy of the
                           certificate of formation of such LLC or Managing
                           Person, as applicable, certified to be true and
                           complete by the appropriate Governmental Authority of
                           the state or jurisdiction of its formation and
                           certified by the sole or managing member of such LLC
                           or Managing Person, as applicable, to be true and
                           correct as of the Closing Date.

                                    (B) LLC Agreement. A copy of the LLC
                           Agreement of such LLC or Managing Person, as
                           applicable, certified by the sole or managing member
                           of such LLC or Managing Person, as applicable, to be
                           true and correct as of the Closing Date.

                                    (C) Resolutions. Copies of resolutions of
                           the sole or managing member of such LLC or Managing
                           Person approving and adopting the Credit Documents to
                           which it or the Person for whom it is acting is a
                           party and the transactions contemplated therein and
                           authorizing execution and delivery thereof.

                                    (D) Good Standing. Copies of certificates of
                           good standing, existence or their equivalent with
                           respect to such LLC or Managing Person, as
                           applicable, certified as of a recent date by the
                           appropriate Governmental Authorities of the state or
                           other jurisdiction of formation and each other
                           jurisdiction in which the failure to so qualify and
                           be in good standing would have or could be reasonably
                           expected to have a Material Adverse Effect.

                                    (E) Incumbency. An incumbency certificate of
                           such LLC or Managing Person certified by an officer
                           of such LLC or Managing Person to be true and correct
                           as of the Closing Date.

                  (c) Opinion of Counsel. Receipt by the Administrative Agent of
         an opinion or opinions from legal counsel to the Credit Parties (which
         shall cover, among other things, authority, legality, validity, binding
         effect, and enforceability of the Credit Documents), reasonably
         satisfactory to the Administrative Agent, addressed to the
         Administrative Agent and the Lenders and dated as of the Closing Date.

                  (d) Financial Statements. Receipt by the Lenders of such
         financial information regarding the Credit Parties required to be
         delivered pursuant to Section 7.1 of each Existing Credit Agreement
         prior to the Closing Date.

                  (e) Litigation. There shall not exist (i) any order, decree,
         judgment, ruling or injunction which prohibits or restrains the
         consummation of the transactions contemplated hereby or (ii) any
         pending (except as set forth on Schedule 6.11) or, to the knowledge of
         any Credit Party, threatened action, suit, investigation or proceeding
         against a Credit Party that would have or could be reasonably expected
         to have a Material Adverse Effect.

                                       45
<PAGE>   51

                  (f) Officer's Certificates. The Administrative Agent shall
         have received a certificate or certificates executed by an Authorized
         Officer of the Borrower as of the Closing Date stating that (i) the
         Borrower and each of its Subsidiaries are in compliance with all
         existing material financial obligations after giving effect to this
         Credit Agreement, (ii) no action, suit, investigation or proceeding is
         pending or, to the knowledge of any Credit Party, threatened in any
         court or before any arbitrator or governmental instrumentality that
         purports to affect the Borrower, any of its Subsidiaries or any
         transaction contemplated by the Credit Documents, if such action, suit,
         investigation or proceeding would have or could be reasonably expected
         to have a Material Adverse Effect, (iii) the financial statements and
         information delivered to the Administrative Agent on or before the
         Closing Date were prepared in good faith and in accordance with GAAP
         and (iv) immediately after giving effect to this Credit Agreement, the
         other Credit Documents and all the transactions contemplated herein and
         therein, including the initial Extensions of Credit hereunder (if any),
         to occur on such date, (A) no Default or Event of Default exists, (B)
         all representations and warranties contained herein and in the other
         Credit Documents are true and correct in all material respects, (C) the
         Credit Parties are in compliance with each of the financial covenants
         set forth in Section 7.2 (with calculations demonstrating same) and (D)
         each Credit Party is Solvent.

                  (g) Material Adverse Effect. There shall not have occurred a
         Material Adverse Effect since March 31, 2000; it being understood and
         agreed that, for purposes of this Section 5.1(g), matters disclosed in
         the Borrower's Form 10-Q report for the fiscal quarter ending March 31,
         2000, as filed with the U.S. Securities and Exchange Commission, shall
         not constitute a Material Adverse Effect.

                  (h) Fees and Expenses. Payment by the Credit Parties of the
         fees and expenses owed by them to the Administrative Agent, the Lenders
         and BAS pursuant to the terms of Section 3.4 and of the Fee Letter.

                  (i) Existing Credit Agreements. The Administrative Agent shall
         have received evidence that all documents executed or delivered in
         connection with the Existing Credit Agreements shall have been
         terminated and that all amounts owing in connection with the Existing
         Credit Agreements shall have been paid in full on or before the
         Effective Date.

                  (j) Market Disruption. There shall not have occurred any
         material disruption of or a material adverse change in conditions in
         the financial, banking or capital markets which the Administrative
         Agent and BAS, in their reasonable discretion, deem material in
         connection with the syndication of this Credit Agreement.

                  (k) Other. Receipt and satisfactory review by the
         Administrative Agent and its counsel of such other documents,
         instruments, agreements or information as reasonably and timely
         requested by the Administrative Agent, its counsel or any Lender,
         including, but not limited to, shareholder agreements, management
         agreements and information regarding litigation, tax, accounting,
         labor, insurance, pension liabilities (actual or contingent), real

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<PAGE>   52

         estate leases, material contracts, debt agreements, property ownership,
         contingent liabilities and management of the Borrower and its
         Subsidiaries.

         5.2      CONDITIONS TO ALL EXTENSIONS OF CREDIT.

         In addition to the conditions precedent stated elsewhere herein, the
Lenders shall not be obligated to make new Loans unless:

                  (a) Notice. The Borrower shall have delivered (i) in the case
         of any new Revolving Loan, a Notice of Borrowing, duly executed and
         completed, by the time specified in Section 2.1 and (ii) in the case of
         any new Swingline Loan, a Swingline Loan Request, duly executed and
         completed, by the time specified in Section 2.2.

                  (b) Representations and Warranties. The representations and
         warranties made by the Credit Parties in any Credit Document are true
         and correct in all material respects at and as if made as of such date
         except to the extent they expressly relate to an earlier date.

                  (c) No Default. No Default or Event of Default shall exist or
         be continuing either prior to or after giving effect thereto.

                  (d) Availability. Immediately after giving effect to the
         making of a Loan (and the application of the proceeds thereof), the sum
         of the Revolving Loans outstanding plus Swingline Loans outstanding
         plus the aggregate amount of secured Indebtedness incurred by the
         Credit Parties pursuant to Section 8.1(h) in excess of $100,000,000
         shall not exceed the Revolving Committed Amount.

The delivery of each Notice of Borrowing and each Swingline Loan Request shall
constitute a representation and warranty by the Borrower of the correctness of
the matters specified in subsections (b), (c) and (d) above.

                                    SECTION 6

                         REPRESENTATIONS AND WARRANTIES

         The Credit Parties hereby represent and warrant to the Administrative
Agent and each Lender that:

         6.1      FINANCIAL CONDITION.

                  (a) The financial statements delivered to the Lenders prior to
         the Effective Date and pursuant to Section 7.1(a) and (b): (i) have
         been prepared in accordance with GAAP and (ii) present fairly the
         consolidated and consolidating (as applicable) financial condition,
         results of operations and cash flows of the Borrower and its
         Subsidiaries as of such date and for such periods.

                                       47
<PAGE>   53

                  (b) Since December 31, 1999, there has been no sale, transfer
         or other disposition by any Credit Party of any material part of the
         business or property of the Credit Parties taken as a whole, and no
         purchase or other acquisition by any of them of any business or
         property (including any Capital Stock of any other Person) material in
         relation to the consolidated financial condition of the Credit Parties
         taken as a whole, in each case which is not (i) reflected in the most
         recent financial statements delivered to the Lenders pursuant to
         Section 7.1 or in the notes thereto or (ii) otherwise permitted by the
         terms of this Credit Agreement and communicated to the Administrative
         Agent.

         6.2      NO MATERIAL CHANGE.

         Since March 31, 2000, there has been no development or event relating
to or affecting a Credit Party which has had or could be reasonably expected to
have a Material Adverse Effect, other than the developments in the First
Heights-related litigation described in Note 4 to the Borrower's condensed
consolidated financial statements contained in its Form 10-Q report for the
fiscal quarter ended March 31, 2000, as filed with the U.S. Securities and
Exchange Commission.

         6.3      ORGANIZATION AND GOOD STANDING.

         Each Credit Party (a) is a corporation, partnership or limited
liability company duly organized, validly existing and in good standing under
the laws of the state (or other jurisdiction) of its organization, (b) is duly
qualified and in good standing as a foreign entity and authorized to do business
in every jurisdiction unless the failure to be so qualified, in good standing or
authorized would have or could be reasonably expected to have a Material Adverse
Effect and (c) has the requisite power and authority to own its properties and
to carry on its business as now conducted and as proposed to be conducted.

         6.4      DUE AUTHORIZATION.

         Each Credit Party (a) has the requisite power and authority to execute,
deliver and perform this Credit Agreement and the other Credit Documents to
which it is a party and to incur the obligations herein and therein provided for
and (b) is duly authorized to, and has been authorized by all necessary action,
to execute, deliver and perform this Credit Agreement and the other Credit
Documents to which it is a party.

         6.5      NO CONFLICTS.

         Neither the execution and delivery of the Credit Documents, nor the
consummation of the transactions contemplated therein, nor performance of and
compliance with the terms and provisions thereof by such Credit Party will (a)
violate or conflict with any provision of its articles or certificate of
incorporation or bylaws, (b) violate, contravene or materially conflict with any
Requirement of Law or any other law, regulation (including, without limitation,
Regulation D, O, T, U or X), order, writ, judgment, injunction, decree or permit
applicable to it, (c) violate, contravene or conflict with contractual
provisions of, or cause an event of default under, any

                                       48
<PAGE>   54

indenture, loan agreement, mortgage, deed of trust, contract or other agreement
or instrument to which it is a party or by which it may be bound, the violation
of which would have or could be reasonably expected to have a Material Adverse
Effect, or (d) result in or require the creation of any Lien (other than those
contemplated in or created in connection with the Credit Documents) upon or with
respect to its properties.

         6.6      CONSENTS.

         Except for consents, approvals and authorizations which have been
obtained, no consent, approval, authorization or order of, or filing,
registration or qualification with, any court or Governmental Authority or third
party in respect of any Credit Party is required in connection with the
execution, delivery or performance of this Credit Agreement or any of the other
Credit Documents by such Credit Party.

         6.7      ENFORCEABLE OBLIGATIONS.

         This Credit Agreement and the other Credit Documents have been duly
executed and delivered and constitute legal, valid and binding obligations of
each Credit Party enforceable against such Credit Party in accordance with their
respective terms, except as may be limited by bankruptcy, insolvency,
reorganization or moratorium laws or similar laws relating to or affecting
creditors' rights generally or by general equitable principles.

         6.8      NO DEFAULT.

         No Credit Party is in default in any respect under any contract, lease,
loan agreement, indenture, mortgage, security agreement or other agreement or
obligation to which it is a party or by which any of its properties is bound
which default would have or could be reasonably expected to have a Material
Adverse Effect. No Default or Event of Default has occurred or exists except as
previously disclosed in writing to the Lenders.

         6.9      LIENS.

         The assets of the Credit Parties are not subject to any Liens other
than Permitted Liens, which, individually or in the aggregate, would have or
could be reasonably expected to have a Material Adverse Effect.

         6.10     INDEBTEDNESS.

         The Credit Parties have no Indebtedness except (a) as disclosed in the
financial statements referenced in Section 6.1, (b) as set forth on Schedule
6.10, and (c) as otherwise permitted by this Credit Agreement.

                                       49
<PAGE>   55

         6.11     LITIGATION.

         Except as set forth on Schedule 6.11, there are no actions, suits or
legal, equitable, arbitration or administrative proceedings, pending or, to the
knowledge of any Credit Party, threatened against any Credit Party which, if
adversely determined, would have or could be reasonably expected to have a
Material Adverse Effect.

         6.12     TAXES.

         Each Credit Party has filed, or caused to be filed, all material tax
returns (federal, state, local and foreign) required to be filed and paid (a)
all amounts of taxes shown thereon to be due and payable (including interest and
penalties) and (b) all other taxes, fees, assessments and other governmental
charges (including mortgage recording taxes, documentary stamp taxes and
intangibles taxes) that are due and payable by it, except for such taxes (i)
which are not yet delinquent or (ii) that are being contested in good faith and
by proper proceedings, and against which adequate reserves are being maintained
in accordance with GAAP. To the knowledge of the Credit Parties, there are no
material tax assessments (including interest and penalties) claimed to be due
against any of them by any Governmental Authority.

         6.13     COMPLIANCE WITH LAW.

         Each Credit Party is in material compliance with all material
Requirements of Law and all other material laws, rules, regulations, orders and
decrees (including without limitation Environmental Laws) applicable to it, or
to its properties. No Requirement of Law would cause or could be reasonably
expected to cause a Material Adverse Effect.

         6.14     ERISA.

         Except as would not have or be reasonably expected to have a Material
Adverse Effect:

                  (a) During the five-year period prior to the date on which
         this representation is made or deemed made: (i) no Termination Event
         has occurred, and, to the knowledge of the Credit Parties, no event or
         condition has occurred or exists as a result of which any Termination
         Event could reasonably be expected to occur, with respect to any Plan;
         (ii) no "accumulated funding deficiency," as such term is defined in
         Section 302 of ERISA and Section 412 of the Code, whether or not
         waived, has occurred with respect to any Plan; (iii) each Plan has been
         maintained, operated, and funded in compliance with its own terms and
         in material compliance with the provisions of ERISA, the Code, and any
         other applicable federal or state laws; and (iv) no lien in favor of
         the PBGC or a Plan has arisen or is reasonably likely to arise on
         account of any Plan.

                  (b) The actuarial present value of all "benefit liabilities"
         (within the meaning of Section 4001 of ERISA) under each Single
         Employer Plan (determined utilizing the actuarial assumptions used to
         fund such Plans), whether or not vested, did not, as of the last annual
         valuation date prior to the date on which this representation is made
         or deemed

                                       50
<PAGE>   56

         made, exceed the fair market current value as of such date of
         the assets of such Plan allocable to such accrued liabilities.

                  (c) Neither the Borrower, nor any of its Subsidiaries, nor any
         ERISA Affiliate has incurred, or, to the knowledge of such parties, are
         reasonably expected to incur, any withdrawal liability under ERISA to
         any Multiemployer Plan or Multiple Employer Plan. Neither the Borrower,
         nor any of its Subsidiaries, nor any ERISA Affiliate has received any
         notification pursuant to ERISA that any Multiemployer Plan is in
         reorganization (within the meaning of Section 4241 of ERISA), is
         insolvent (within the meaning of Section 4245 of ERISA), or has been
         terminated (within the meaning of Title IV of ERISA), and, to the best
         knowledge of such parties, no Multiemployer Plan is reasonably expected
         to be in reorganization, insolvent, or terminated.

                  (d) No nonexempt prohibited transaction (within the meaning of
         Section 406 of ERISA or Section 4975 of the Code) or breach of
         fiduciary responsibility has occurred with respect to a Plan which has
         subjected or is reasonably expected to subject the Borrower or any of
         its Subsidiaries or any ERISA Affiliate to any liability under Sections
         406, 409, 502(i), or 502(l) of ERISA or Section 4975 of the Code, or
         under any agreement or other instrument pursuant to which the Borrower
         or any of its Subsidiaries or any ERISA Affiliate has agreed or is
         required to indemnify any person against any such liability.

                  (e) The present value of the liability of the Borrower and its
         Subsidiaries and each ERISA Affiliate for post-retirement welfare
         benefits to be provided to their current and former employees under
         Plans which are welfare benefit plans (as defined in Section 3(1) of
         ERISA), net of all assets under all such Plans allocable to such
         benefits, are reflected on the Financial Statements in accordance with
         FASB 106.

                  (f) Each Plan which is a welfare plan (as defined in Section
         3(1) of ERISA) to which Sections 601-609 of ERISA and Section 4980B of
         the Code apply has been administered in material compliance with such
         sections.

         6.15     SUBSIDIARIES.

         Set forth on Schedule 6.15 is a complete and accurate list of all
Subsidiaries of each Credit Party and whether each such Person is a Material
Subsidiary. Schedule 6.15 shall be updated by the Borrower within 120 days after
the end of each calendar year and may be, but need not be, updated at any other
time and from time to time by the Borrower by giving written notice thereof to
the Administrative Agent.

         6.16     USE OF PROCEEDS.

         The proceeds of the Loans hereunder will be used solely for the
purposes specified in Section 7.10. No proceeds of the Loans hereunder have been
or will be used for the Acquisition of another Person unless the board of
directors (or other comparable governing body) or stockholders, as appropriate,
of such Person has approved such Acquisition.

                                       51
<PAGE>   57

         6.17     GOVERNMENT REGULATION.

                  (a) No proceeds of the Loans will be used, directly or
         indirectly, for the purpose of purchasing or carrying any "margin
         stock" within the meaning of Regulation U, or for the purpose of
         purchasing or carrying or trading in any securities. If requested by
         any Lender or the Administrative Agent, the Borrower will furnish to
         the Administrative Agent and each Lender a statement to the foregoing
         effect in conformity with the requirements of FR Form U-1 referred to
         in Regulation U. No Indebtedness being reduced or retired out of the
         proceeds of the Loans was or will be incurred for the purpose of
         purchasing or carrying any margin stock within the meaning of
         Regulation U or any "margin security" within the meaning of Regulation
         T. "Margin stock" within the meaning of Regulation U does not
         constitute more than 25% of the value of the consolidated assets of the
         Credit Parties and their Subsidiaries. None of the transactions
         contemplated by the Credit Documents (including, without limitation,
         the direct or indirect use of the proceeds of the Loans) will violate
         or result in a violation of (i) the Securities Act or (ii) the Exchange
         Act.

                  (b) No Credit Party is subject to regulation under the Public
         Utility Holding Company Act of 1935, the Federal Power Act or the
         Investment Company Act of 1940, each as amended. In addition, no Credit
         Party is (i) an "investment company" registered or required to be
         registered under the Investment Company Act of 1940, as amended, and is
         not controlled by an "investment company", or (ii) a "holding company",
         or a "subsidiary company" of a "holding company", or an "affiliate" of
         a "holding company" or of a "subsidiary" of a "holding company", within
         the meaning of the Public Utility Holding Company Act of 1935, as
         amended.

                  (c) No director, executive officer or principal shareholder of
         any Credit Party is a director, executive officer or principal
         shareholder of any Lender. For the purposes hereof the terms
         "director", "executive officer" and "principal shareholder" (when used
         with reference to any Lender) have the respective meanings assigned
         thereto in Regulation O.

         6.18     ENVIRONMENTAL MATTERS.

         Except as would not have or could not be reasonably expected to have a
Material Adverse Effect:

                  (a) Each of the Real Properties and all operations at the Real
         Properties are in compliance with all applicable Environmental Laws,
         and there is no violation of any Environmental Law with respect to the
         Real Properties or the businesses operated by the Credit Parties (the
         "Businesses"), and there are no conditions relating to the Businesses
         or Real Properties that would reasonably be expected to give rise to
         liability under any applicable Environmental Laws.

                                       52
<PAGE>   58

                  (b) No Credit Party has received any written notice of, or
         inquiry from any Governmental Authority regarding, any violation,
         alleged violation, non-compliance, liability or potential liability
         regarding Hazardous Materials or compliance with Environmental Laws
         with regard to any of the Real Properties or the Businesses, nor, to
         the knowledge of a Credit Party, is any such notice being threatened.

                  (c) Hazardous Materials have not been transported or disposed
         of from the Real Properties, or generated, treated, stored or disposed
         of at, on or under any of the Real Properties or any other location, in
         each case by, or on behalf or with the permission of, a Credit Party in
         a manner that would give rise to liability under any applicable
         Environmental Laws.

                  (d) No judicial proceeding or governmental or administrative
         action is pending or, to the knowledge of a Credit Party, threatened
         under any Environmental Law to which a Credit Party is or will be named
         as a party, nor are there any consent decrees or other decrees, consent
         orders, administrative orders or other orders, or other administrative
         or judicial requirements outstanding under any Environmental Law with
         respect to a Credit Party, the Real Properties or the Businesses.

                  (e) There has been no release (including, without limitation,
         disposal) or threat of release of Hazardous Materials at or from the
         Real Properties, or arising from or related to the operations of a
         Credit Party in connection with the Real Properties or otherwise in
         connection with the Businesses where such release constituted a
         violation of, or would give rise to liability under, any applicable
         Environmental Laws.

                  (f) None of the Real Properties contains, or has previously
         contained, any Hazardous Materials at, on or under the Real Properties
         in amounts or concentrations that, if released, constitute or
         constituted a violation of, or could give rise to liability under,
         Environmental Laws.

                  (g) No Credit Party has assumed any liability of any Person
         (other than another Credit Party or Subsidiary thereof) under any
         Environmental Law.

         6.19     INTELLECTUAL PROPERTY.

         Each Credit Party owns, or has the legal right to use, all patents,
trademarks, service marks, tradenames, copyrights, licenses, technology,
know-how, processes and other rights (the "Intellectual Property"), free from
burdensome restrictions, that are necessary for the operation of their
respective businesses as presently conducted and as proposed to be conducted
other than those the absence of which would not cause or could not reasonably be
expected to cause a Material Adverse Effect. Except as would not have or could
not be reasonably expected to have a Material Adverse Effect, (a) no holding,
decision or judgment has been rendered by any Governmental Authority which would
limit, cancel or question the validity of any Intellectual Property and (b) no
action or proceeding is pending that seeks to limit, cancel or question the

                                       53
<PAGE>   59

validity of any Intellectual Property or which, if adversely determined, would
have a material adverse effect on the value of any Intellectual Property.

         6.20     SOLVENCY.

         Each Credit Party is, and after consummation of the transactions
contemplated by this Credit Agreement will be, Solvent.

         6.21     INVESTMENTS.

         All Investments of each Credit Party are (a) as set forth on
Schedule 6.21(b) or (b) Permitted Investments.

         6.22     DISCLOSURE.

         Neither this Credit Agreement nor any other Credit Document or
financial statement delivered to the Administrative Agent or the Lenders by or
on behalf of any Credit Party in connection with the transactions contemplated
hereby contains any untrue statement of a material fact or omits to state a
material fact necessary in order to make the statements contained therein or
herein, taken as a whole, not misleading.

         6.23     LICENSES, ETC.

         Except as would not have or could not be reasonably expected to have a
Material Adverse Effect, the Credit Parties have obtained and hold in full force
and effect, all material franchises, licenses, permits, certificates,
authorizations, qualifications, accreditations, easements, rights of way and
other rights, consents and approvals which are necessary for the operation of
their respective businesses as presently conducted.

         6.24     BURDENSOME RESTRICTIONS.

         No Credit Party is a party to any agreement or instrument or subject to
any other obligation or any charter or corporate restriction or any provision of
any Requirement of Law which, individually or in the aggregate, would have or
could be reasonably expected to have a Material Adverse Effect.

         6.25     LABOR CONTRACTS AND DISPUTES.

         Except as disclosed on Schedule 6.25, (a) there is no collective
bargaining agreement or other labor contract covering employees of any Credit
Party; (b) no union or other labor organization is seeking to organize, or be
recognized as, a collective bargaining unit of employees of any Credit Party;
and (c) there is no pending or, to any Credit Party's knowledge, threatened
strike, work stoppage, material unfair labor practice claim or other material
labor dispute against or affecting any Credit Party or its employees which,
individually or in the aggregate, would have or could be reasonably expected to
have a Material Adverse Effect.

                                       54
<PAGE>   60

         6.26     BROKER'S FEES.

         No Credit Party will pay or agree to pay, or reimburse any other Person
with respect to, any finder's, broker's, investment banking or other similar fee
in connection with any of the transactions contemplated under the Credit
Documents.

                                    SECTION 7

                              AFFIRMATIVE COVENANTS

         Each Credit Party hereby covenants and agrees that so long as this
Credit Agreement is in effect and until the Loans, together with interest and
fees and other obligations then due and payable hereunder, have been paid in
full (other than any such obligations which by the terms thereof are stated to
survive termination of the Credit Documents) and the Commitments hereunder shall
have terminated:

         7.1      INFORMATION COVENANTS.

         The Credit Parties will furnish, or cause to be furnished, to the
Administrative Agent and each of the Lenders:

                  (a) Annual Financial Statements. As soon as available, and in
         any event within 120 days after the close of each fiscal year of the
         Borrower, a consolidated and consolidating balance sheet and income
         statement of the Borrower and its Subsidiaries, as of the end of such
         fiscal year, together with related consolidated and consolidating
         statements of operations, retained earnings, shareholders equity and
         cash flows for such fiscal year, setting forth in comparative form
         consolidated and consolidating figures for the preceding fiscal year,
         all such financial information described above to be in reasonable form
         and detail and audited by independent certified public accountants of
         recognized national standing reasonably acceptable to the
         Administrative Agent and whose opinion shall be to the effect that such
         financial statements have been prepared in accordance with GAAP (except
         for changes with which such accountants concur) and shall not be
         limited as to the scope of the audit or qualified in any manner, except
         for qualifications resulting from changes in GAAP and required or
         approved by the Borrower's independent certified public accountants. It
         is specifically understood and agreed that failure of the annual
         financial statements to be accompanied by an opinion of such
         accountants in form and substance as provided herein shall constitute
         an Event of Default hereunder.

                  (b) Quarterly Statements.

                  As soon as available, and in any event within 60 days after
         the close of each fiscal quarter (other than the fourth fiscal quarter,
         in which case 120 days after the end thereof) of

                                       55
<PAGE>   61

         each fiscal year of the Borrower, a consolidated and consolidating
         balance sheet and income statement of the Borrower and its
         Subsidiaries, as of the end of such quarter, together with related
         consolidated and consolidating statements of operations, retained
         earnings, shareholders' equity and cash flow for such quarter, in each
         case setting forth in comparative form consolidated and consolidating
         figures for the corresponding period of the preceding fiscal year, all
         such financial information described above to be in reasonable form and
         detail and reasonably acceptable to the Administrative Agent and
         accompanied by a certificate of the chief financial officer of the
         Borrower to the effect that such consolidated and consolidating
         statements are true and correct and have been prepared in accordance
         with GAAP, subject to changes resulting from audit and normal year-end
         audit adjustments.

                  (c) Officer's Certificate. At the time of delivery of the
         financial statements provided for in Sections 7.1(a) and 7.1(b) above,
         a certificate of an Authorized Officer of the Borrower substantially in
         the form of Exhibit 7.1(c), (i) demonstrating compliance with the
         financial covenants contained in Section 7.2 by calculation thereof as
         of the end of each such period, (ii) calculating the Interest Coverage
         Ratio of the Borrower and its Subsidiaries for the twelve month period
         ending on the date of such financial statements, (iii) demonstrating
         compliance with any other terms of this Credit Agreement as requested
         by the Administrative Agent and (iv) stating that no Default or Event
         of Default exists, or if any Default or Event of Default does exist,
         specifying the nature and extent thereof and what action the Borrower
         proposes to take with respect thereto. If necessary, the Borrower shall
         deliver financial statements prepared in accordance with GAAP as of the
         Closing Date, to the extent GAAP has changed since the Closing Date, in
         order to show compliance with the terms of this Credit Agreement,
         including Section 7.2. In addition, at the time of any Investment
         pursuant to clause (j) of the definition of Permitted Investments in
         excess of $10,000,000, a certificate of an Authorized Officer of the
         Borrower stating that after giving effect to such Investment on a pro
         forma basis no Default or Event of Default will exist or be continuing
         as a result of such Investment.

                  (d) Reports. Promptly upon transmission or receipt thereof,
         (a) copies of any public filings and registrations with, and reports to
         or from, the Securities and Exchange Commission, or any successor
         agency, and copies of all financial statements, proxy statements,
         notices and reports as the Borrower or any of its Subsidiaries shall
         send to its shareholders generally and (b) upon the written request of
         the Administrative Agent, all reports and written information to and
         from the United States Environmental Protection Agency, or any state or
         local agency responsible for environmental matters, the United States
         Occupational Health and Safety Administration, or any state or local
         agency responsible for health and safety matters, or any successor
         agencies or authorities concerning environmental, health or safety
         matters.

                  (e) Notices. Upon an executive officer of a Credit Party
         obtaining knowledge thereof, the Borrower will give written notice to
         the Administrative Agent (a) immediately of the occurrence of an event
         or condition consisting of a Default or Event of Default, specifying
         the nature and existence thereof and what action the Credit Parties
         propose to take with respect thereto, and (b) promptly, but in any
         event within five Business Days, after

                                       56
<PAGE>   62
         the occurrence of any of the following with respect to any Credit
         Party: (i) the pendency or commencement of any litigation, arbitral or
         governmental proceeding against a Credit Party which if adversely
         determined would have or could be reasonably expected to have a
         Material Adverse Effect, (ii) the institution of any proceedings
         against a Credit Party with respect to, or the receipt of written
         notice by such Person of potential liability or responsibility for
         violation, or alleged violation, of any federal, state or local law,
         rule or regulation (including but not limited to, Environmental Laws),
         the violation of which would have or could be reasonably expected to
         have a Material Adverse Effect, (iii) the occurrence of an event or
         condition which shall constitute a default or event of default under
         any Indebtedness of a Credit Party in excess of $10,000,000, other than
         Non-Recourse Land Financing, or (iv) any loss of or damage to any
         property of a Credit Party or the commencement of any proceeding for
         the condemnation or other taking of any property of a Credit Party
         having a value of $10,000,000 or more.

                  (f) ERISA. Upon any of the Credit Parties or any ERISA
         Affiliate obtaining knowledge thereof, the Borrower will give written
         notice to the Administrative Agent promptly (and in any event within
         two Business Days) of: (i) any event or condition, including, but not
         limited to, any Reportable Event, that constitutes, or might reasonably
         lead to, a Termination Event; (ii) with respect to any Multiemployer
         Plan, the receipt of notice as prescribed in ERISA or otherwise of any
         withdrawal liability assessed against the Credit Parties or any of
         their ERISA Affiliates, or of a determination that any Multiemployer
         Plan is in reorganization or insolvent (both within the meaning of
         Title IV of ERISA); (iii) the failure to make full payment on or before
         the due date (including extensions) thereof of all amounts which a
         Credit Party or any ERISA Affiliates is required to contribute to each
         Plan pursuant to its terms and as required to meet the minimum funding
         standard set forth in ERISA and the Code with respect thereto; or (iv)
         any change in the funding status of any Plan that would have or could
         be reasonably expected to have a Material Adverse Effect; together with
         a description of any such event or condition or a copy of any such
         notice and a statement by the principal financial officer of the
         Borrower briefly setting forth the details regarding such event,
         condition, or notice, and the action, if any, which has been or is
         being taken or is proposed to be taken by the Credit Parties with
         respect thereto. Promptly upon request, a Credit Party shall furnish
         the Administrative Agent and each of the Lenders with such additional
         information concerning any Plan as may be reasonably requested,
         including, but not limited to, copies of each annual report/return
         (Form 5500 series), as well as all schedules and attachments thereto
         required to be filed with the Department of Labor and/or the Internal
         Revenue Service pursuant to ERISA and the Code, respectively, for each
         "plan year" (within the meaning of Section 3(39) of ERISA).

                  (g) Environmental.

                           (i) Subsequent to a notice from any Governmental
                  Authority where the subject matter of such notice would
                  reasonably cause concern or during the existence of an Event
                  of Default, and upon the written request of the Administrative
                  Agent, the Credit Parties will furnish or cause to be
                  furnished to the Administrative

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                  Agent, at the Credit Parties' expense, a report of an
                  environmental assessment of reasonable scope, form and depth,
                  including, where appropriate, invasive soil or groundwater
                  sampling, by a consultant reasonably acceptable to the
                  Administrative Agent addressing the subject of such notice or,
                  if during the existence of an Event of Default, regarding any
                  release or threat of release of Hazardous Materials on any
                  Real Property and the compliance by the Credit Parties with
                  Environmental Laws. If the Credit Parties fail to deliver such
                  an environmental assessment within sixty (60) days after
                  receipt of such written request, then the Administrative Agent
                  may arrange for same, and the Credit Parties hereby grant to
                  the Administrative Agent and its representatives access to the
                  Real Properties and a license of a scope reasonably necessary
                  to undertake such an assessment (including, where appropriate,
                  invasive soil or groundwater sampling). The reasonable cost of
                  any assessment arranged for by the Administrative Agent
                  pursuant to this provision will be payable by the Credit
                  Parties on demand.

                           (ii) Each Credit Party will conduct and complete all
                  investigations, studies, sampling and testing and all
                  remedial, removal and other actions necessary to address all
                  Hazardous Materials on, from, or affecting any Real Property
                  to the extent necessary to be in compliance with all
                  Environmental Laws and all other applicable federal, state,
                  and local laws, regulations, rules and policies and with the
                  orders and directives of all Governmental Authorities
                  exercising jurisdiction over such Real Property to the extent
                  any failure would have or could be reasonably expected to have
                  a Material Adverse Effect.

                  (h) Other Information. As soon as available and in any event
         within 60 days of each fiscal quarter (or within 120 days of the fourth
         fiscal quarter), a "Land Report" and a "Consolidated Sales and
         Construction Activity Report" and with reasonable promptness upon any
         request, such other information regarding the business, properties or
         financial condition of the Credit Parties as the Administrative Agent
         or the Lenders may reasonably request; provided that the Borrower may
         require that prior to distribution of such information to a Lender,
         such Lender shall have executed and delivered to the Borrower a
         confidentiality agreement in form and substance reasonably satisfactory
         to the Borrower and such Lender.

         7.2      FINANCIAL COVENANTS.

                  (a) Debt to Capitalization Ratio. As of the last day of each
         fiscal quarter of the Borrower (beginning with the fiscal quarter
         ending September 30, 2000), the Debt to Capitalization Ratio shall be
         less than or equal to 0.50 to 1.0.

                  (b) Tangible Net Worth. As of the last day of each fiscal
         quarter of the Borrower (beginning with the fiscal quarter ending
         September 30, 2000), Tangible Net Worth shall be greater than or equal
         to the sum of (i) $800 million, plus (ii) 50% of the cumulative Net
         Income (without deduction for losses) earned for each completed fiscal
         quarter subsequent to March 31, 2000 to the date of determination.

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         7.3      PRESERVATION OF EXISTENCE AND FRANCHISES.

         Except as permitted by Section 8.4, each of the Credit Parties will do
all things necessary to preserve and keep in full force and effect its (a)
existence, rights and franchises and (b) authority, unless failure to preserve
and keep in full force and effect its authority would not have or could not be
reasonably expected to have a Material Adverse Effect.

         7.4      BOOKS AND RECORDS.

         Each of the Credit Parties will keep complete and accurate books and
records of its transactions in accordance with GAAP (including the establishment
and maintenance of appropriate reserves).

         7.5      COMPLIANCE WITH LAW.

         Each of the Credit Parties will materially comply with all material
laws, rules, regulations and orders, and all applicable material restrictions
imposed by all Governmental Authorities, applicable to it and its property
(including, without limitation, Environmental Laws).

         7.6      PAYMENT OF TAXES AND OTHER INDEBTEDNESS.

         Each of the Credit Parties will pay, settle or discharge (a) all taxes,
assessments and governmental charges or levies imposed upon it, or upon its
income or profits, or upon any of its properties, before they shall become
delinquent, (b) all lawful claims (including claims for labor, materials and
supplies) which, if unpaid, might give rise to a Lien upon any of its
properties, and (c) all of its other Indebtedness as it shall become due (to the
extent such repayment is not otherwise prohibited by this Credit Agreement);
provided, however, that a Credit Party shall not be required to pay any such
tax, assessment, charge, levy, claim or Indebtedness which is being contested in
good faith by appropriate proceedings and as to which adequate reserves therefor
have been established in accordance with GAAP, unless the failure to make any
such payment (i) would give rise to an immediate right to foreclose or collect
on a Lien securing such amounts or (ii) would have or could be reasonably
expected to have a Material Adverse Effect.

         7.7      INSURANCE.

         Each of the Credit Parties will at all times maintain in full force and
effect insurance (including worker's compensation insurance, liability
insurance, casualty insurance and business interruption insurance) from
insurance companies of recognized national standing, in such amounts, covering
such risks and liabilities and with such deductibles or self-insurance
retentions as are in accordance with normal industry practice.

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         7.8      MAINTENANCE OF PROPERTY.

         Each of the Credit Parties will maintain and preserve its properties,
equipment and other assets in good repair, working order and condition, normal
wear and tear excepted, and will make, or cause to be made, in such properties
and equipment from time to time all repairs, renewals, replacements, extensions,
additions, betterments and improvements thereto as may be needed or proper, to
the extent and in the manner customary for companies in similar businesses,
unless the failure to do so would not have or could not be reasonably expected
to have a Material Adverse Effect.

         7.9      PERFORMANCE OF OBLIGATIONS.

         Each of the Credit Parties will perform in all material respects all of
its obligations under the terms of all material agreements, indentures,
mortgages, security agreements or other debt instruments to which it is a party
or by which it or its property is bound, unless the failure to do so would not
have or could not be reasonably expected to have a Material Adverse Effect.

         7.10     USE OF PROCEEDS.

         The Credit Parties will use the proceeds/availability of the Loans
solely (a) to repay Indebtedness owing under the Existing Credit Agreements, (b)
to provide working capital for the Credit Parties and (c) for general corporate
purposes of the Credit Parties, including money market borrowings and commercial
paper backup.

         7.11     AUDITS/INSPECTIONS.

         Upon reasonable notice and during normal business hours, each Credit
Party will permit representatives appointed by the Administrative Agent,
including, without limitation, independent accountants, agents, attorneys and
appraisers, to visit and inspect such Credit Party's property, including its
books and records, its accounts receivable and inventory, its facilities and its
other business assets, and to make photocopies or photographs thereof and to
write down and record any information such representative obtains and shall
permit the Administrative Agent or its representatives to investigate and verify
the accuracy of information provided to the Lenders.

         7.12     ADDITIONAL CREDIT PARTIES.

         At the time any Person becomes a Material Subsidiary of a Credit Party,
the Borrower shall so notify the Administrative Agent and promptly thereafter
(but in any event within 30 days after the date thereof or within such longer
period of time as agreed to by the Administrative Agent) shall cause such Person
to (a) execute a Joinder Agreement in substantially the same form as Exhibit
7.12 and (b) deliver to the Administrative Agent such other documentation as the
Administrative Agent may reasonably request, including, without limitation,
certified copies of resolutions and other corporate, limited liability company
or partnership documents and favorable opinions of counsel to such Person (which
shall cover, among other things, the legality, validity, binding effect and
enforceability of the Joinder Agreement executed by such Person), all in form,

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content and scope reasonably satisfactory to the Administrative Agent. The
Administrative Agent and the Lenders agree that upon any Subsidiary ceasing to
be a Material Subsidiary, upon receipt by the Administrative Agent of evidence
thereof, the Administrative Agent shall execute, at the Borrower's expense, such
release documentation as is necessary to release such Subsidiary from its
Guaranty Obligations hereunder and such Subsidiary shall no longer be a
Guarantor.

                                    SECTION 8

                               NEGATIVE COVENANTS

         Each Credit Party hereby covenants and agrees that so long as this
Credit Agreement is in effect and until the Loans, together with interest, fees
and other obligations then due and payable hereunder, have been paid in full
(other than any such obligations which by the terms thereof are stated to
survive termination of the Credit Documents) and the Commitments hereunder shall
have terminated:

         8.1      INDEBTEDNESS.

         No Credit Party will contract, create, incur, assume or permit to exist
any Indebtedness, except:

                  (a) Indebtedness arising under this Credit Agreement and the
         other Credit Documents;

                  (b) Indebtedness existing as of the Closing Date as referenced
         in Section 6.10 (and renewals, refinancings, replacements or extensions
         thereof on terms and conditions no more favorable, in the aggregate, to
         the applicable creditor than such existing Indebtedness and in a
         principal amount not in excess of that outstanding as of the date of
         such renewal, refinancing, replacement or extension);

                  (c) Indebtedness in respect of current accounts payable and
         accrued expenses incurred in the ordinary course of business and to the
         extent not current, accounts payable and accrued expenses that are
         subject to bona fide dispute;

                  (d) Indebtedness owing by a Credit Party to another Credit
         Party;

                  (e) Indebtedness arising from Hedging Agreements entered into
         in the ordinary  course of business and not for speculative purposes;

                  (f) Indebtedness arising from judgments that do not cause an
         Event of Default;

                  (g) secured Indebtedness in connection with Non-Recourse Land
         Financing existing on the Closing Date and Non-Recourse Land Financing
         with respect to real property acquired after the Closing Date.

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                  (h) other secured Indebtedness up to $200,000,000, in the
         aggregate, at any one time outstanding; provided that for each dollar
         of secured Indebtedness incurred in excess of $100,000,000, as
         permitted under this Section 8.1(h), availability under the Revolving
         Committed Amount shall be reduced by one dollar; and

                  (i) other unsecured Indebtedness so long as, after giving
         effect thereto, the Borrower is in compliance with the financial
         covenants set forth in Section 7.2.

         8.2      LIENS.

         No Credit Party will contract, create, incur, assume or permit to exist
any Lien with respect to any of its property or assets of any kind (whether real
or personal, tangible or intangible), whether now owned or after acquired,
except for Permitted Liens.

         8.3      NATURE OF BUSINESS.

         No Credit Party will materially alter the character of its business
from that conducted as of the Closing Date or engage in any business other than
the business conducted as of the Closing Date and activities which are
substantially similar or related thereto or logical extensions thereof.

         8.4      CONSOLIDATION AND MERGER.

         No Credit Party will enter into any transaction of merger or
consolidation or liquidate, wind up or dissolve itself; provided that a Credit
Party may merge or consolidate with or into another Person if the following
conditions are satisfied:

                  (a) the Administrative Agent is given prior written notice of
         such action;

                  (b) the Person formed by such consolidation or into which such
         Credit Party is merged shall either (i) be a Credit Party or (ii)
         expressly assume in writing all of the obligations of a Credit Party
         under the Credit Documents; provided that if the transaction is between
         the Borrower and another Person, the Borrower must be the surviving
         entity;

                  (c) immediately after giving effect to such transaction, no
         Default or Event of Default shall have occurred and be continuing; and

                  (d) the Borrower delivers to the Administrative Agent an
         opinion of counsel stating that such consolidation or merger and any
         written agreement entered into in connection therewith, comply with
         this Section 8.4.

         8.5      SALE OR LEASE OF ASSETS.

         No Credit Party will convey, sell, lease, transfer or otherwise dispose
of, in one transaction or a series of transactions, all or any part of its
business or assets whether now owned or hereafter

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acquired, including, without limitation, inventory, receivables, equipment, real
property interests (whether owned or leasehold), and securities, other than (a)
any inventory sold or otherwise disposed of in the ordinary course of business;
(b) the sale, lease, transfer or other disposal by a Credit Party of any or all
of its assets to another Credit Party; (c) obsolete, slow-moving, idle or
worn-out assets no longer used or useful in its business; (d) the transfer of
assets which constitute a Permitted Investment; (e) any Equity Issuance by the
Borrower; (f) the sale, lease or sublease of real property interests in the
ordinary course of business; (g) the sale, transfer or other disposal for fair
market value of all or substantially all of the Capital Stock or assets of a
Guarantor to a Person that is not a Credit Party; provided that (i) after giving
effect to any such sale, transfer or other disposal, the Credit Parties shall be
in compliance with all of the terms and conditions of this Credit Agreement and
the other Credit Documents, including, without limitation, the terms of Section
7.12 and the definition of Material Subsidiary, (ii) the net cash proceeds from
any such sale, transfer or other disposal shall be (A) first, applied to all
outstanding Revolving Loans (first to Base Rate Loans and then to Eurodollar
Loans and Index Rate Swingline Loans in direct order of Interest Period
maturities) and (B) second, reinvested in the business of the Credit Parties or
used by the Credit Parties in the ordinary course of business within 90 days
after the closing of such transfer, sale or other disposal and (iii) promptly
after the net cash proceeds from any such sale, transfer or other disposal have
been so utilized, the Borrower shall deliver to the Administrative Agent a
certificate executed by an Authorized Officer certifying on behalf of the
Borrower (A) as to the amount of such net cash proceeds and (B) that such net
cash proceeds have been reinvested in accordance with the terms of the foregoing
clause (ii), and (h) other sales of assets in the ordinary course of business so
long as, after giving effect thereto, the Borrower is in compliance with the
financial covenants set forth in Section 7.2.

         8.6      SALE AND LEASEBACK.

         No Credit Party will enter into any Sale and Leaseback Transaction,
unless each of the following conditions is satisfied: (a) such Credit Party
shall promptly give notice of such sale or transfer to the Administrative Agent;
(b) the net proceeds of such sale or transfer are at least equal to the fair
value (as determined in good faith by a resolution of such Credit Party's board
of directors, a copy of which has been delivered by the Credit Party to the
Administrative Agent) of the property which is the subject of such sale or
transfer; and (c) such Credit Party shall apply, within 365 days after the
effective date of such sale or transfer, or shall have committed within one year
after such effective date to apply, an amount at least equal to the net proceeds
of the sale or transfer of the property which is the subject of such sale or
transfer to (A) the repayment of the Loans or (B) the repayment of other
Indebtedness owing by any Credit Party or (C) the purchase of property by such
Credit Party substantially similar to the property that was the subject of such
sale or transfer or (D) in part to such repayment and in part to such purchase
or property; provided, however, that if such Credit Party commits to apply an
amount at least equal to the net proceeds of a sale or transfer to the repayment
of the Loans, the repayment of other Indebtedness or the purchase of property,
such commitment shall be made in a written instrument delivered by such Credit
Party to the Administrative Agent and shall require such Credit Party to so
apply said amount within 18 months after the effective date of such sale or
transfer, and it shall constitute a breach of the provisions of this Section 8.6
if such Credit Party shall fail so to apply said amount in satisfaction of such
commitment.

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         8.7      ADVANCES, INVESTMENTS AND LOANS.

         No Credit Party will make any Investments except for Permitted
Investments.

         8.8      RESTRICTED PAYMENTS.

         No Credit Party will, directly or indirectly, use proceeds of Loans to
pay dividends or make any other distribution (excluding repurchases of shares of
Capital Stock) upon any shares of its Capital Stock of any class.

         8.9      TRANSACTIONS WITH AFFILIATES.

         No Credit Party will enter into any material transaction or series of
transactions, whether or not in the ordinary course of business, with any
officer, director, shareholder, Subsidiary or Affiliate other than on terms and
conditions substantially as favorable as would be obtainable in a comparable
arm's-length transaction with a Person other than an officer, director,
shareholder, Subsidiary or Affiliate.

         8.10     FISCAL YEAR; ORGANIZATIONAL DOCUMENTS.

         No Credit Party will (a) change its fiscal year or (b) in any manner
that would reasonably be likely to adversely affect the rights of the Lenders,
change its articles or certificate of incorporation or its bylaws, except as
permitted by Section 8.4.

         8.11     NO LIMITATIONS.

         No Credit Party will directly or indirectly, create or otherwise cause,
incur, assume, suffer or permit to exist or become effective any consensual
encumbrance or restriction of any kind on the ability of any such Person to (a)
pay dividends or make any other distribution on any of such Person's Capital
Stock, (b) pay any Indebtedness owed to any other Credit Party, (c) make loans
or advances to any other Credit Party or (d) transfer any of its property to any
other Credit Party, except for encumbrances or restrictions existing under or by
reason of (i) customary non-assignment or net worth provisions in any lease
governing a leasehold interest, (ii) any agreement or other instrument of a
Person existing at the time it becomes a Subsidiary of a Credit Party; provided
that such encumbrance or restriction is not applicable to any other Person, or
any property of any other Person, other than such Person becoming a Subsidiary
of a Credit Party and was not entered into in contemplation of such Person
becoming a Subsidiary of a Credit Party, and (iii) this Credit Agreement and the
other Credit Documents.

         8.12     NO OTHER NEGATIVE PLEDGES.

         No Credit Party will enter into, assume or become subject to any
agreement prohibiting or otherwise restricting the creation or assumption of any
Lien upon its properties or assets, whether

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now owned or hereafter acquired, or requiring the grant of any security for such
obligation if security is given for some other obligation except as set forth in
the Credit Documents.

         8.13     OTHER INDEBTEDNESS.

         No Credit Party will, if any Event of Default has occurred and is
continuing or would be directly or indirectly caused as a result thereof, (a)
with respect to any Indebtedness (other than the Indebtedness under the Credit
Documents) of such Credit Party, shorten the final maturity or average life to
maturity or require any payment to be made sooner than originally scheduled or
increase the interest rate applicable thereto or change any subordination
provision thereof or (b) make (or give any notice with respect thereto) any
voluntary or optional payment or prepayment, redemption, acquisition for value
or defeasance of (including without limitation, by way of depositing money or
securities with the trustee with respect thereto before due for the purpose of
paying when due), refund, refinance or exchange of any Indebtedness (other than
the Indebtedness under the Credit Documents) of such Credit Party.

                                    SECTION 9

                                EVENTS OF DEFAULT

         9.1      EVENTS OF DEFAULT.

         An Event of Default shall exist upon the occurrence, and during the
continuation, of any of the following specified events (each an "Event of
Default"):

                  (a) Payment. Any Credit Party shall default in the payment (i)
         when due of any principal of any of the Loans or (ii) within five
         Business Days of when due of any interest on the Loans or any fees or
         other amounts owing hereunder, under any of the other Credit Documents
         or in connection herewith.

                  (b) Representations. Any representation, warranty or statement
         made or deemed to be made by any Credit Party herein, in any of the
         other Credit Documents, or in any statement or certificate delivered or
         required to be delivered pursuant hereto or thereto shall prove untrue
         in any material respect on the date as of which it was made or deemed
         to have been made.

                  (c) Covenants.  Any Credit Party shall:

                           (i) default in the due performance or observance of
                  any term, covenant or agreement contained in Sections 7.2,
                  7.10 or 8.1 through 8.13 inclusive;

                           (ii) default in the due performance or observance of
                  any term, covenant or agreement contained in Sections 7.1,
                  7.3, 7.5 or 7.11 and such default shall continue unremedied
                  for a period of five Business Days after the earlier of a
                  Credit

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                  Party becoming aware of such default or notice thereof given
                  by the Administrative Agent; or

                           (iii) default in the due performance or observance by
                  it of any term, covenant or agreement (other than those
                  referred to in subsections (a), (b) or (c)(i) of this Section
                  9.1) contained in this Credit Agreement and such default shall
                  continue unremedied for a period of at least 30 days after the
                  earlier of a Credit Party becoming aware of such default or
                  written notice thereof given by the Administrative Agent.

                  (d) Other Credit Documents. (i) Any Credit Party shall default
         in the due performance or observance of any term, covenant or agreement
         in any of the other Credit Documents and such default shall continue
         unremedied for a period of at least 30 days after the earlier of a
         Credit Party becoming aware of such default or written notice thereof
         given by the Administrative Agent, or (ii) any Credit Document shall
         fail to be in full force and effect or any Credit Party shall so assert
         or any Credit Document shall fail to give the Administrative Agent and
         the Lenders the security interests, liens, rights, powers and
         privileges purported to be created thereby.

                  (e) Guaranties. The guaranty given by any Credit Party
         hereunder or by any Additional Credit Party hereafter or any provision
         thereof shall cease to be in full force and effect, or any Guarantor
         thereunder or any Person acting by or on behalf of such Guarantor shall
         deny or disaffirm such Guarantor's obligations under such guaranty.

                  (f) Bankruptcy, etc. The occurrence of any of the following:
         (i) a court or governmental agency having jurisdiction in the premises
         shall enter a decree or order for relief in respect of any Credit Party
         or any of its Subsidiaries in an involuntary case under any applicable
         bankruptcy, insolvency or other similar law now or hereafter in effect,
         or appoint a receiver, liquidator, assignee, custodian, trustee,
         sequestrator or similar official of any Credit Party or any of its
         Subsidiaries or for any substantial part of its property or ordering
         the winding up or liquidation of its affairs; or (ii) an involuntary
         case under any applicable bankruptcy, insolvency or other similar law
         now or hereafter in effect is commenced against any Credit Party or any
         of its Subsidiaries and such petition remains unstayed and in effect
         for a period of 60 consecutive days; or (iii) any Credit Party or any
         of its Subsidiaries shall commence a voluntary case under any
         applicable bankruptcy, insolvency or other similar law now or hereafter
         in effect, or consent to the entry of an order for relief in an
         involuntary case under any such law, or consent to the appointment or
         taking possession by a receiver, liquidator, assignee, custodian,
         trustee, sequestrator or similar official of such Person or any
         substantial part of its property or make any general assignment for the
         benefit of creditors; or (iv) any Credit Party or any of its
         Subsidiaries shall admit in writing its inability to pay its debts
         generally as they become due or any action shall be taken by such
         Person in furtherance of any of the aforesaid purposes.

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                  (g) Defaults under Other Agreements.

                           (i) A Credit Party shall default in the due
                  performance or observance (beyond the applicable grace period
                  with respect thereto) of any material obligation or condition
                  of any contract or lease material to the Credit Parties taken
                  as a whole to which it is a party or by which it or its
                  property is bound; or

                           (ii) With respect to any Indebtedness of a Credit
                  Party the principal amount of which is in excess of $10
                  million (other than Indebtedness outstanding under this Credit
                  Agreement and Non-Recourse Land Financing), (A) any such
                  Credit Party shall (x) default in any payment (beyond the
                  applicable grace period with respect thereto, if any) with
                  respect to any such Indebtedness, or (y) default (after giving
                  effect to any applicable grace period) in the observance or
                  performance relating to such Indebtedness or contained in any
                  instrument or agreement evidencing, securing or relating
                  thereto, or any other event or condition shall occur or
                  condition exist, the effect of which default or other event or
                  condition is to cause the holder or holders of such
                  Indebtedness (or trustee or agent on behalf of such holders)
                  to cause (determined without regard to whether any notice or
                  lapse of time is required) any such Indebtedness to become due
                  prior to its stated maturity; (B) any such Indebtedness shall
                  be declared due and payable, or required to be prepaid other
                  than by a regularly scheduled required prepayment prior to the
                  stated maturity thereof; or (C) any such Indebtedness shall
                  mature and remain unpaid.

                  (h) Judgments. Any judgment, order, or decree (including,
         without limitation, any judgment, order, or decree with respect to any
         litigation disclosed pursuant to the Credit Documents) shall be entered
         against any one or more of the Credit Parties involving a liability of
         $25 million or more (to the extent not paid or covered by insurance
         provided by a carrier who has acknowledged coverage and in any event
         not including any Non-Recourse Land Financing), and such judgment,
         order or decree (i) is the subject of any enforcement proceeding
         commenced by any creditor or (ii) shall continue unsatisfied,
         undischarged and unstayed for a period ending on the first to occur of
         (A) the last day on which such judgment, order or decree becomes final
         and unappealable or (B) 30 days.

                  (i) ERISA. The occurrence of any of the following events or
         conditions: (A) any "accumulated funding deficiency," as such term is
         defined in Section 302 of ERISA and Section 412 of the Code, whether or
         not waived, shall exist with respect to any Plan, or any Lien shall
         arise on the assets of any Credit Party, any of its Subsidiaries or any
         ERISA Affiliate in favor of the PBGC or a Plan; (B) a Termination Event
         shall occur with respect to a Single Employer Plan, which is, in the
         reasonable opinion of the Administrative Agent, likely to result in the
         termination of such Plan for purposes of Title IV of ERISA; (C) a
         Termination Event shall occur with respect to a Multiemployer Plan or
         Multiple Employer Plan, which is, in the reasonable opinion of the
         Administrative Agent, likely to result in (i) the termination of such
         Plan for purposes of Title IV of ERISA, or (ii) any Credit Party, any
         of its Subsidiaries or any ERISA Affiliate incurring any liability in
         connection with a withdrawal from, reorganization of (within the
         meaning of Section 4241 of ERISA), or

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         insolvency (within the meaning of Section 4245 of ERISA) of such Plan;
         or (D) any prohibited transaction (within the meaning of Section 406 of
         ERISA or Section 4975 of the Code) or breach of fiduciary
         responsibility shall occur which may subject any Credit Party, any of
         its Subsidiaries or any ERISA Affiliate to any liability under Sections
         406, 409, 502(i), or 502(l) of ERISA or Section 4975 of the Code, or
         under any agreement or other instrument pursuant to which any Credit
         Party, any of its Subsidiaries or any ERISA Affiliate has agreed or is
         required to indemnify any person against any such liability.

                  (j) Ownership.  There shall occur a Change of Control.

         9.2      ACCELERATION; REMEDIES.

         Upon the occurrence and during the continuance of an Event of Default,
and at any time thereafter unless and until such Event of Default has been
waived in writing by the Required Lenders (or the Lenders as may be required
hereunder), the Administrative Agent shall, upon the request and direction of
the Required Lenders, by written notice to the Borrower, take the following
actions without prejudice to the rights of the Administrative Agent or any
Lender to enforce its claims against the Credit Parties, except as otherwise
specifically provided for herein:

                  (a) Termination of Commitments.  Declare the Commitments
         terminated whereupon the Commitments shall be immediately terminated.

                  (b) Acceleration of Loans. Declare the unpaid principal of and
         any accrued interest in respect of all Loans and any and all other
         indebtedness or obligations of any and every kind owing by a Credit
         Party to any of the Lenders hereunder to be due whereupon the same
         shall be immediately due and payable without presentment, demand,
         protest or other notice of any kind, all of which are hereby waived by
         the Credit Parties.

                  (c) Enforcement of Rights. Enforce any and all rights and
         interests created and existing under the Credit Documents, including,
         without limitation, all rights and remedies against a Guarantor and all
         rights of set-off.

Notwithstanding the foregoing, if an Event of Default specified in Section
9.1(f) shall occur, then the Commitments shall automatically terminate and all
Loans, all accrued interest in respect thereof, all accrued and unpaid fees and
other indebtedness or obligations owing to the Lenders hereunder shall
immediately become due and payable without the giving of any notice or other
action by the Administrative Agent or the Lenders, which notice or other action
is expressly waived by the Credit Parties.

Notwithstanding the fact that enforcement powers reside primarily with the
Administrative Agent, each Lender has, to the extent permitted by law, a
separate right of payment and shall be considered a separate "creditor" holding
a separate "claim" within the meaning of Section 101(5) of the Bankruptcy Code
or any other insolvency statute.

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         9.3      ALLOCATION OF PAYMENTS AFTER EVENT OF DEFAULT.

         Notwithstanding any other provisions of this Credit Agreement, after
the occurrence and during the continuance of an Event of Default, all amounts
collected or received by the Administrative Agent or any Lender on account of
amounts outstanding under any of the Credit Documents shall be paid over or
delivered as follows:

                  FIRST, to the payment of all reasonable out-of-pocket costs
         and expenses (including without limitation reasonable attorneys' fees)
         of the Administrative Agent or any of the Lenders in connection with
         enforcing the rights of the Lenders under the Credit Documents;

                  SECOND, to payment of any fees owed to the Administrative
         Agent or any Lender;

                  THIRD, to the payment of all accrued interest payable to the
         Lenders hereunder and all other obligations (other than those
         obligations to be paid pursuant to clause "FOURTH" below) which shall
         have become due and payable under the Credit Documents and not repaid
         pursuant to clauses "FIRST" and "SECOND" above;

                  FOURTH, to the payment of the outstanding principal amount of
         the Loans, pro rata as set forth below; and

                  FIFTH, to the payment of the surplus, if any, to whomever may
         be lawfully entitled to receive such surplus.

In carrying out the foregoing, (a) amounts received shall be applied in the
numerical order provided until exhausted prior to application to the next
succeeding category and (b) each of the Lenders shall receive an amount equal to
its pro rata share (based on the proportion that the then outstanding Loans held
by such Lender bears to the aggregate then outstanding Loans) of amounts
available to be applied.

                                   SECTION 10

                                AGENCY PROVISIONS

         10.1     APPOINTMENT.

         Each Lender hereby designates and appoints Bank of America as
Administrative Agent of such Lender to act as specified herein and in the other
Credit Documents, and each such Lender hereby authorizes the Administrative
Agent, as the agent for such Lender, to take such action on its behalf under the
provisions of this Credit Agreement and the other Credit Documents and to
exercise such powers and perform such duties as are expressly delegated by the
terms hereof and of the other Credit Documents, together with such other powers
as are reasonably incidental thereto. Notwithstanding any provision to the
contrary elsewhere herein and in the other Credit Documents, the Administrative
Agent shall not have any duties or responsibilities except those expressly set

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forth herein and therein or any fiduciary relationship with any Lender, and no
implied covenants, functions, responsibilities, duties, obligations or
liabilities shall be read into this Credit Agreement or any of the other Credit
Documents, or shall otherwise exist against the Administrative Agent. The
provisions of this Section are solely for the benefit of the Administrative
Agent and the Lenders and none of the Credit Parties shall have any rights as a
third party beneficiary of the provisions hereof. In performing its functions
and duties under this Credit Agreement and the other Credit Documents, the
Administrative Agent shall act solely as an agent of the Lenders and does not
assume and shall not be deemed to have assumed any obligation or relationship of
agency or trust with or for any Credit Party or any of its Subsidiaries.

         10.2     DELEGATION OF DUTIES.

         The Administrative Agent may execute any of its duties hereunder or
under the other Credit Documents by or through agents or attorneys-in-fact and
shall be entitled to advice of counsel concerning all matters pertaining to such
duties. The Administrative Agent shall not be responsible for the negligence or
misconduct of any agents or attorneys-in-fact selected by it with reasonable
care.

         10.3     EXCULPATORY PROVISIONS.

         Neither the Administrative Agent nor any of its officers, directors,
employees, agents, attorneys-in-fact or affiliates shall be liable for any
action lawfully taken or omitted to be taken by it or such Person under or in
connection herewith or in connection with any of the other Credit Documents
(except for its or such Person's own gross negligence or willful misconduct) or
responsible in any manner to any of the Lenders for any recitals, statements,
representations or warranties made by any of the Credit Parties contained herein
or in any of the other Credit Documents or in any certificate, report, document,
financial statement or other written or oral statement referred to or provided
for in, or received by the Administrative Agent under or in connection herewith
or in connection with the other Credit Documents, or enforceability or
sufficiency therefor of any of the other Credit Documents, or for any failure of
the Borrower to perform its obligations hereunder or thereunder. The
Administrative Agent shall not be responsible to any Lender for the
effectiveness, genuineness, validity, enforceability, collectibility or
sufficiency of this Credit Agreement, or any of the other Credit Documents or
for any representations, warranties, recitals or statements made herein or
therein or made by the Borrower or any of its Subsidiaries in any written or
oral statement or in any financial or other statements, instruments, reports,
certificates or any other documents in connection herewith or therewith
furnished or made by the Administrative Agent to the Lenders or by or on behalf
of the Credit Parties to the Administrative Agent or any Lender or be required
to ascertain or inquire as to the performance or observance of any of the terms,
conditions, provisions, covenants or agreements contained herein or therein or
as to the use of the proceeds of the Loans or of the existence or possible
existence of any Default or Event of Default or to inspect the properties, books
or records of the Credit Parties. The Administrative Agent is not a trustee for
the Lenders and owes no fiduciary duty to the Lenders.

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         10.4     RELIANCE ON COMMUNICATIONS.

         The Administrative Agent shall be entitled to rely, and shall be fully
protected in relying, upon any note, writing, resolution, notice, consent,
certificate, affidavit, letter, cablegram, telegram, telecopy, telex or teletype
message, statement, order or other document or conversation reasonably believed
by it to be genuine and correct and to have been signed, sent or made by the
proper Person or Persons and upon advice and statements of legal counsel
(including, without limitation, counsel to any of the Credit Parties,
independent accountants and other experts selected by the Administrative Agent
with reasonable care). The Administrative Agent may deem and treat each Lender
as the owner of its interests hereunder for all purposes unless a written notice
of assignment, negotiation or transfer thereof shall have been filed with the
Administrative Agent in accordance with Section 11.3(b). The Administrative
Agent shall be fully justified in failing or refusing to take any action under
this Credit Agreement or under any of the other Credit Documents unless it shall
first receive such advice or concurrence of the Required Lenders as it deems
appropriate or it shall first be indemnified to its satisfaction by the Lenders
against any and all liability and expense which may be incurred by it by reason
of taking or continuing to take any such action. The Administrative Agent shall
in all cases be fully protected in acting, or in refraining from acting,
hereunder or under any of the other Credit Documents in accordance with a
request of the Required Lenders (or, to the extent specifically provided in
Section 11.6, all the Lenders) and such request and any action taken or failure
to act pursuant thereto shall be binding upon all the Lenders (including their
successors and assigns).

         10.5     NOTICE OF DEFAULT.

         The Administrative Agent shall not be deemed to have knowledge or
notice of the occurrence of any Default or Event of Default hereunder unless the
Administrative Agent has received notice from a Lender or a Credit Party
referring to the Credit Document, describing such Default or Event of Default
and stating that such notice is a "notice of default." In the event that the
Administrative Agent receives such a notice, the Administrative Agent shall give
prompt notice thereof to the Lenders. The Administrative Agent shall take such
action with respect to such Default or Event of Default as shall be reasonably
directed by the Required Lenders and as is permitted by the Credit Documents.

         10.6     NON-RELIANCE ON ADMINISTRATIVE AGENT AND OTHER LENDERS.

         Each Lender expressly acknowledges that neither the Administrative
Agent, BAS nor any of their officers, directors, employees, agents,
attorneys-in-fact or affiliates has made any representations or warranties to it
and that no act by the Administrative Agent or any affiliate thereof hereinafter
taken, including any review of the affairs of any Credit Party or any of its
Subsidiaries, shall be deemed to constitute any representation or warranty by
the Administrative Agent to any Lender. Each Lender represents to the
Administrative Agent and BAS that it has, independently and without reliance
upon the Administrative Agent or BAS or any other Lender, and based on such
documents and information as it has deemed appropriate, made its own appraisal
of and investigation into the business, assets, operations, property, financial
and other conditions, prospects and creditworthiness of the Credit Parties and
made its own decision to make its Loans

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<PAGE>   77

hereunder and enter into this Credit Agreement. Each Lender also represents that
it will, independently and without reliance upon the Administrative Agent or BAS
or any other Lender, and based on such documents and information as it shall
deem appropriate at the time, continue to make its own credit analysis,
appraisals and decisions in taking or not taking action under this Credit
Agreement, and to make such investigation as it deems necessary to inform itself
as to the business, assets, operations, property, financial and other
conditions, prospects and creditworthiness of the Credit Parties. Except for
notices, reports and other documents expressly required to be furnished to the
Lenders by the Administrative Agent hereunder, the Administrative Agent and BAS
shall not have any duty or responsibility to provide any Lender with any credit
or other information concerning the business, operations, assets, property,
financial or other conditions, prospects or creditworthiness of the Credit
Parties which may come into the possession of the Administrative Agent, BAS or
any of their officers, directors, employees, agents, attorneys-in-fact or
affiliates.

         10.7     INDEMNIFICATION.

         The Lenders agree to indemnify the Administrative Agent in its capacity
as such (to the extent not reimbursed by the Borrower and without limiting the
obligation of the Borrower to do so), ratably according to their respective
Commitments (or if the Commitments have expired or been terminated, in
accordance with the respective principal amounts of outstanding Loans and
Participation Interests of the Lenders), from and against any and all
liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
costs, expenses or disbursements of any kind whatsoever which may at any time
(including without limitation at any time following payment in full of the
Credit Party Obligations) be imposed on, incurred by or asserted against the
Administrative Agent in its capacity as such in any way relating to or arising
out of this Credit Agreement or the other Credit Documents or any documents
contemplated by or referred to herein or therein or the transactions
contemplated hereby or thereby or any action taken or omitted by the
Administrative Agent under or in connection with any of the foregoing; provided
that no Lender shall be liable for the payment of any portion of such
liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
costs, expenses or disbursements resulting from the gross negligence or willful
misconduct of the Administrative Agent. If any indemnity furnished to the
Administrative Agent for any purpose shall, in the opinion of the Administrative
Agent, be insufficient or become impaired, the Administrative Agent may call for
additional indemnity and cease, or not commence, to do the acts indemnified
against until such additional indemnity is furnished. The agreements in this
Section shall survive the payment of the Credit Party Obligations and all other
amounts payable hereunder and under the other Credit Documents.

         10.8     ADMINISTRATIVE AGENT IN ITS INDIVIDUAL CAPACITY.

         The Administrative Agent and its Affiliates may make loans to, accept
deposits from and generally engage in any kind of business with the Borrower or
any of its Subsidiaries as though the Administrative Agent were not the
Administrative Agent hereunder. With respect to the Loans made and all
obligations owing to it, the Administrative Agent shall have the same rights and
powers under this Credit Agreement as any Lender and may exercise the same as
though they were

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not the Administrative Agent, and the terms "Lender" and "Lenders" shall include
the Administrative Agent in its individual capacity.

         10.9     SUCCESSOR ADMINISTRATIVE AGENT.

         The Administrative Agent may, at any time, resign upon 20 days written
notice to the Lenders. Upon any such resignation, the Required Lenders shall
have the right to appoint a successor Administrative Agent. If no successor
Administrative Agent shall have been so appointed by the Required Lenders, and
shall have accepted such appointment, within 60 days after the notice of
resignation, then the retiring Administrative Agent shall select a successor
Administrative Agent, provided such successor is an Eligible Assignee. Upon the
acceptance of any appointment as the Administrative Agent hereunder by a
successor, such successor Administrative Agent shall thereupon succeed to and
become vested with all the rights, powers, privileges and duties of the retiring
Administrative Agent, and the retiring Administrative Agent shall be discharged
from its duties and obligations as the Administrative Agent, as appropriate,
under this Credit Agreement and the other Credit Documents and the provisions of
this Section 10.9 shall inure to its benefit as to any actions taken or omitted
to be taken by it while it was the Administrative Agent under this Credit
Agreement. If no successor Administrative Agent has accepted appointment as
Administrative Agent within 75 days after the retiring Administrative Agent's
giving notice of resignation, the retiring Administrative Agent's resignation
shall nevertheless become effective and the Lenders shall perform all duties of
the Administrative Agent hereunder until such time, if any, as the Required
Lenders appoint a successor Administrative Agent as provided for above. Subject
to the foregoing terms of this Section 10.9, there shall at all times be a
Person or Persons serving as Administrative Agent hereunder.

                                   SECTION 11

                                  MISCELLANEOUS

         11.1     NOTICES.

         Except as otherwise expressly provided herein, all notices and other
communications shall have been duly given and shall be effective (a) when
delivered in writing, (b) when transmitted via telecopy (or other facsimile
device) to the number set out below, (c) the Business Day following the day on
which the same has been delivered prepaid (or on an invoice basis) to a
reputable national overnight air courier service, or (d) the third Business Day
following the day on which the same is sent by certified or registered mail,
postage prepaid, in each case to the respective parties at the address or
telecopy numbers set forth on Schedule 11.1, or at such other address as such
party may specify by written notice to the other parties hereto.

         11.2     RIGHT OF SET-OFF.

         In addition to any rights now or hereafter granted under applicable law
or otherwise, and not by way of limitation of any such rights, upon the
occurrence of an Event of Default and the

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commencement of remedies described in Section 9.2, each Lender is authorized at
any time and from time to time, without presentment, demand, protest or other
notice of any kind (all of which rights being hereby expressly waived), to
set-off and to appropriate and apply any and all deposits (general or special)
and any other indebtedness at any time held or owing by such Lender (including,
without limitation, branches, agencies or Affiliates of such Lender wherever
located) to or for the credit or the account of any Credit Party or any of its
Subsidiaries against the Credit Party Obligations of such Credit Party,
irrespective of whether the Administrative Agent or the Lenders shall have made
any demand hereunder and although such Credit Party Obligations may be
contingent or unmatured, and any such set-off shall be deemed to have been made
immediately upon the occurrence of an Event of Default even though such charge
is made or entered on the books of such Lender subsequent thereto. The Credit
Parties hereby agree that any Person purchasing a participation in the Loans and
Commitments hereunder pursuant to Section 11.3(e) or 3.8 may exercise all rights
of set-off with respect to its participation interest as fully as if such Person
were a Lender hereunder.

         11.3     BENEFIT OF AGREEMENT.

                  (a) Generally. This Credit Agreement shall be binding upon and
         inure to the benefit of and be enforceable by the respective successors
         and assigns of the parties hereto; provided that none of the Credit
         Parties may assign and transfer any of its interests (except as
         permitted by Section 8.4 or 8.5) without the prior written consent of
         the Lenders; and provided further that the rights of each Lender to
         transfer, assign or grant participations in its rights and/or
         obligations hereunder shall be limited as set forth below in this
         Section 11.3.

                  (b) Assignments. Each Lender may assign to one or more
         Eligible Assignees all or a portion of its rights and obligations under
         this Credit Agreement (including, without limitation, all or a portion
         of its Loans, its Notes, and its Commitments); provided, however, that:

                           (i)   except in the case of an assignment to another
                  Lender, any such partial assignment shall be in an amount at
                  least equal to $10,000,000 or an integral multiple of
                  $1,000,000 in excess thereof;

                           (ii)  unless the assigning Lender is assigning all of
                  its rights and obligations under this Credit Agreement, the
                  assigning Lender shall retain a Commitment of not less than
                  $10,000,000;

                           (iii) each such assignment by a Lender shall be of a
                  constant, and not varying, percentage of all of its rights and
                  obligations under this Credit Agreement and the Notes; and

                           (iv)  the parties to such assignment shall execute
                  and deliver to the Administrative Agent for its acceptance an
                  assignment agreement in substantially

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                  the form of Exhibit 11.3(b) (each an "Assignment Agreement"),
                  together with a processing fee from the assignor or assignee
                  of $3,500.

         Upon execution, delivery, and acceptance of such Assignment Agreement,
         the assignee thereunder shall be a party hereto and, to the extent of
         such assignment, have the obligations, rights, and benefits of a Lender
         hereunder and the assigning Lender shall, to the extent of such
         assignment, relinquish its rights and be released from its obligations
         under this Credit Agreement. Upon the consummation of any assignment
         pursuant to this Section 11.3(b), the assignor, the Administrative
         Agent and the Borrower shall make appropriate arrangements so that, if
         required, new Notes are issued to the assignor and the assignee. If the
         assignee is not incorporated under the laws of the United States of
         America or a state thereof, it shall deliver to the Borrower and the
         Administrative Agent certification as to exemption from deduction or
         withholding of taxes in accordance with Section 3.13.

         By executing and delivering an Assignment Agreement in accordance with
         this Section 11.3(b), the assigning Lender thereunder and the assignee
         thereunder shall be deemed to confirm to and agree with each other and
         the other parties hereto as follows: (A) such assigning Lender warrants
         that it is the legal and beneficial owner of the interest being
         assigned thereby free and clear of any adverse claim and the assignee
         warrants that it is an Eligible Assignee; (B) except as set forth in
         clause (A) above, such assigning Lender makes no representation or
         warranty and assumes no responsibility with respect to any statements,
         warranties or representations made in or in connection with this Credit
         Agreement, any of the other Credit Documents or any other instrument or
         document furnished pursuant hereto or thereto, or the execution,
         legality, validity, enforceability, genuineness, sufficiency or value
         of this Credit Agreement, any of the other Credit Documents or any
         other instrument or document furnished pursuant hereto or thereto or
         the financial condition of any Credit Party or any of its Subsidiaries
         or the performance or observance by any Credit Party of any of its
         obligations under this Credit Agreement, any of the other Credit
         Documents or any other instrument or document furnished pursuant hereto
         or thereto; (C) such assignee represents and warrants that it is
         legally authorized to enter into such Assignment Agreement; (D) such
         assignee confirms that it has received a copy of this Credit Agreement,
         the other Credit Documents and such other documents and information as
         it has deemed appropriate to make its own credit analysis and decision
         to enter into such Assignment Agreement; (E) such assignee will
         independently and without reliance upon the Administrative Agent, such
         assigning Lender or any other Lender, and based on such documents and
         information as it shall deem appropriate at the time, continue to make
         its own credit decisions in taking or not taking action under this
         Credit Agreement and the other Credit Documents; (F) such assignee
         appoints and authorizes the Administrative Agent to take such action on
         its behalf and to exercise such powers under this Credit Agreement or
         any other Credit Document as are delegated to the Administrative Agent
         by the terms hereof or thereof, together with such powers as are
         reasonably incidental thereto; and (G) such assignee agrees that it
         will perform in accordance with their terms all the obligations which
         by the terms of this Credit Agreement and the other Credit Documents
         are required to be performed by it as a Lender.

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                  (c) Register. The Administrative Agent shall maintain a copy
         of each Assignment Agreement delivered to and accepted by it and a
         register for the recordation of the names and addresses of the Lenders
         and the Commitment of, and principal amount of the Loans owing to, each
         Lender from time to time (the "Register"). The entries in the Register
         shall be conclusive and binding for all purposes, absent manifest
         error, and the Borrower, the Administrative Agent and the Lenders may
         treat each Person whose name is recorded in the Register as a Lender
         hereunder for all purposes of this Credit Agreement. The Register shall
         be available for inspection by the Borrower or any Lender at any
         reasonable time and from time to time upon reasonable prior notice.

                  (d) Acceptance. Upon its receipt of an Assignment Agreement
         executed by the parties thereto, together with any Note subject to such
         assignment and payment of the processing fee, the Administrative Agent
         shall, if such Assignment Agreement has been completed and is in
         substantially the form of Exhibit 11.3(b) hereto, (i) accept such
         Assignment Agreement, (ii) record the information contained therein in
         the Register and (iii) give prompt notice thereof to the parties
         thereto.

                  (e) Participations. Each Lender may sell participations to one
         or more Persons in all or a portion of its rights, obligations or
         rights and obligations under this Credit Agreement (including all or a
         portion of its Commitments and its Loans); provided, however, that (i)
         such Lender's obligations under this Credit Agreement shall remain
         unchanged, (ii) such Lender shall remain solely responsible to the
         other parties hereto for the performance of such obligations, (iii) the
         participant shall be entitled to the benefit of the yield protection
         provisions contained in Sections 3.9 through 3.14, inclusive, and the
         right of set-off contained in Section 11.2, (iv) the Borrower shall
         continue to deal solely and directly with such Lender in connection
         with such Lender's rights and obligations under this Credit Agreement,
         and such Lender shall retain the sole right to enforce the obligations
         of the Borrower relating to its Loans and its Notes and to approve any
         amendment, modification, or waiver of any provision of this Credit
         Agreement (other than amendments, modifications, or waivers decreasing
         the amount of principal of or the rate at which interest is payable on
         such Loans or Notes, extending any scheduled principal payment date or
         date fixed for the payment of interest on such Loans or Notes (other
         than as a result of the extension of the Maturity Date in accordance
         with the terms of Section 2.5), extending its Commitments or releasing
         all or substantially all of the Guarantors) and (v) such Lender shall
         provide written notice of any participation to the Borrower and the
         Administrative Agent.

                  (f) Nonrestricted Assignments. Notwithstanding any other
         provision set forth in this Credit Agreement, any Lender may at any
         time assign and pledge all or any portion of its Loans and its Notes to
         any Federal Reserve Bank as collateral security pursuant to Regulation
         A and any Operating Circular issued by such Federal Reserve Bank. No
         such assignment shall release the assigning Lender from its obligations
         hereunder.

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                  (g) Information. Any Lender may furnish any information
         concerning the Borrower or any of its Subsidiaries in the possession of
         such Lender from time to time to assignees and participants (including
         prospective assignees and participants), subject, however, to the
         provisions of Section 11.16.

         11.4     NO WAIVER; REMEDIES CUMULATIVE.

         No failure or delay on the part of the Administrative Agent or any
Lender in exercising any right, power or privilege hereunder or under any other
Credit Document and no course of dealing between the Borrower or any of its
Subsidiaries and the Administrative Agent or any Lender shall operate as a
waiver thereof; nor shall any single or partial exercise of any right, power or
privilege hereunder or under any other Credit Document preclude any other or
further exercise thereof or the exercise of any other right, power or privilege
hereunder or thereunder. The rights and remedies provided herein are cumulative
and not exclusive of any rights or remedies which the Administrative Agent or
any Lender would otherwise have. No notice to or demand on any Credit Party in
any case shall entitle any Credit Party to any other or further notice or demand
in similar or other circumstances or constitute a waiver of the rights of the
Administrative Agent or the Lenders to any other or further action in any
circumstances without notice or demand.

         11.5     PAYMENT OF EXPENSES; INDEMNIFICATION.

         The Credit Parties agree to: (a) pay all reasonable out-of-pocket costs
and expenses of (i) the Administrative Agent and BAS in connection with (A) the
negotiation, preparation, execution and delivery and administration of this
Credit Agreement and the other Credit Documents and the documents and
instruments referred to therein (including, without limitation, the reasonable
fees and expenses of Moore & Van Allen, PLLC, special counsel to the
Administrative Agent), and (B) any amendment, waiver or consent relating hereto
and thereto including, but not limited to, any such amendments, waivers or
consents resulting from or related to any work-out, renegotiation or restructure
relating to the performance by the Credit Parties under this Credit Agreement
and (ii) the Administrative Agent and the Lenders in connection with (A)
enforcement of the Credit Documents and the documents and instruments referred
to therein, including, without limitation, in connection with any such
enforcement, the reasonable fees and disbursements of counsel for the
Administrative Agent and each of the Lenders, and (B) any bankruptcy or
insolvency proceeding of a Credit Party or any of its Subsidiaries and (b)
indemnify the Administrative Agent, BAS, each Lender and each of their officers,
directors, employees, representatives, Affiliates and agents from and hold each
of them harmless against any and all losses, liabilities, claims, damages or
expenses (including, without limitation, the reasonable fees and expenses of
legal counsel (including the allocated cost of internal counsel) and settlement
costs incurred by any of them as a result of, or arising out of, or in any way
related to, or by reason of, any investigation, litigation or other proceeding
(whether or not the Administrative Agent, BAS or any Lender is a party thereto)
related to (i) the entering into and/or performance of any Credit Document or
the use of proceeds of any Loans (including other Extensions of Credit)
hereunder or the consummation of any other transactions contemplated in any
Credit Document, including, without limitation, the reasonable fees and
disbursements of counsel incurred in connection with any such investigation,
litigation or other proceeding, (ii) any Environmental Claim, (iii) any claims
for Non-Excluded Taxes (but

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excluding in the case of (i), (ii) and (iii) above, any such losses,
liabilities, claims, damages or expenses to the extent incurred by reason of
gross negligence or willful misconduct on the part of the Person to be
indemnified).

         11.6     AMENDMENTS, WAIVERS AND CONSENTS.

         Subject to Section 11.16(b), neither this Credit Agreement nor any
other Credit Document nor any of the terms hereof or thereof may be amended,
changed, waived, discharged or terminated unless such amendment, change, waiver,
discharge or termination is in writing and signed by the Required Lenders and
the then Credit Parties; provided that no such amendment, change, waiver,
discharge or termination shall without the consent of each Lender affected
thereby:

                  (a) extend the Maturity Date (other than with the consent of
         the Extension Required Lenders pursuant to Section 2.5);

                  (b) reduce the rate or extend the time of payment of interest
         thereon or fees hereunder (it being understood and agreed that a waiver
         of the applicability of any post-default increase in interest rates
         shall not constitute a reduction in the rate of interest for purposes
         of this clause (b));

                  (c) reduce or waive the principal amount of any Loan;

                  (d) increase or extend any Commitment of a Lender (it being
         understood and agreed that a waiver of any Default or Event of Default
         or a waiver of any mandatory reduction in the Commitments or any
         increase in the Revolving Committed Amount pursuant to Section 2.1(e)
         shall not constitute a change in the terms of any Commitment of any
         Lender);

                  (e) except as the result of or in connection with a merger or
         other disposition of a Credit Party permitted under Section 8.4, (i)
         release the Borrower from its obligations under the Credit Documents or
         (ii) release any Credit Party that individually or, together with any
         other Credit Party previously released or to be released simultaneously
         therewith, cumulatively accounts for more than 5% of Tangible Net Worth
         from its obligations under the Credit Documents;

                  (f) amend, modify or waive any provision of this Section 11.6
         or Section 3.4(a), 3.4(b), 3.7, 3.8, 5.2, 9.1(a), 11.2, 11.3 or 11.5;

                  (g) reduce any percentage specified in, or otherwise modify,
         the definition of Required Lenders set forth in Section 1.1; or

                  (h) consent to the assignment or transfer by a Borrower or all
         or substantially all of the other Credit Parties of any of its or their
         rights and obligations under (or in respect of) the Credit Documents
         except as permitted thereby.

                                       78

<PAGE>   84

Notwithstanding the above, no provisions of Section 10 may be amended or
modified without the consent of the Administrative Agent. No provision of
Section 2.2 affecting the Swingline Loans may be amended without the consent of
Bank of America.

Notwithstanding the fact that the consent of all the Lenders is required in
certain circumstances as set forth above, (x) each Lender is entitled to vote as
such Lender sees fit on any reorganization plan that affects the Loans, and each
Lender acknowledges that the provisions of Section 1126(c) of the Bankruptcy
Code supersedes the unanimous consent provisions set forth herein and (y) the
Required Lenders may consent to allow a Credit Party to use cash collateral in
the context of a bankruptcy or insolvency proceeding.

         11.7    COUNTERPARTS/TELECOPY.

         This Credit Agreement may be executed in any number of counterparts,
each of which where so executed and delivered shall be an original, but all of
which shall constitute one and the same instrument. Delivery of executed
counterparts by telecopy shall be as effective as an original and shall
constitute a representation that an original will be delivered.

         11.8    HEADINGS.

         The headings of the sections and subsections hereof are provided for
convenience only and shall not in any way affect the meaning or construction of
any provision of this Credit Agreement.

         11.9    DEFAULTING LENDER.

         Each Lender understands and agrees that if such Lender is a Defaulting
Lender then notwithstanding the provisions of Section 11.6 it shall not be
entitled to vote on any matter requiring the consent of the Required Lenders or
to object to any matter requiring the consent of all the Lenders; provided,
however, that all other benefits and obligations under the Credit Documents
shall apply to such Defaulting Lender.

         11.10   SURVIVAL OF INDEMNIFICATION AND REPRESENTATIONS AND WARRANTIES.

         All indemnities set forth herein and all representations and warranties
made herein shall survive the execution and delivery of this Credit Agreement,
the making of the Loans, and the repayment of the Loans and other obligations
and the termination of the Commitments hereunder.

         11.11   GOVERNING LAW; JURISDICTION.

                  (a) THIS CREDIT AGREEMENT AND THE OTHER CREDIT DOCUMENTS AND
         THE RIGHTS AND OBLIGATIONS OF THE PARTIES HEREUNDER AND THEREUNDER
         SHALL BE GOVERNED BY AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH
         THE LAWS OF THE STATE OF NORTH CAROLINA. Any legal action or proceeding
         with respect to this Credit Agreement or any other Credit Document may
         be brought in the courts of the State of North

                                       79

<PAGE>   85

         Carolina or of the United States for the Western District of North
         Carolina, and, by execution and delivery of this Credit Agreement, each
         Credit Party hereby irrevocably accepts for itself and in respect of
         its property, generally and unconditionally, the jurisdiction of such
         courts. Each Credit Party further irrevocably consents to the service
         of process out of any of the aforementioned courts in any such action
         or proceeding by the mailing of copies thereof by registered or
         certified mail, postage prepaid, to it at the address for notices
         pursuant to Section 11.1, such service to become effective 20 days
         after such mailing. Nothing herein shall affect the right of a Lender
         to serve process in any other manner permitted by law or to commence
         legal proceedings or to otherwise proceed against a Credit Party in any
         other jurisdiction.

                  (b) Each Credit Party hereby irrevocably waives any objection
         which it may now or hereafter have to the laying of venue of any of the
         aforesaid actions or proceedings arising out of or in connection with
         this Credit Agreement or any other Credit Document brought in the
         courts referred to in subsection (a) hereof and hereby further
         irrevocably waives and agrees not to plead or claim in any such court
         that any such action or proceeding brought in any such court has been
         brought in an inconvenient forum.

         11.12    WAIVER OF JURY TRIAL.

         EACH OF THE PARTIES TO THIS CREDIT AGREEMENT HEREBY IRREVOCABLY WAIVES
ALL RIGHT TO TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM ARISING OUT
OF OR RELATING TO THIS CREDIT AGREEMENT, ANY OF THE OTHER CREDIT DOCUMENTS OR
THE TRANSACTIONS CONTEMPLATED HEREBY.

         11.13    SEVERABILITY.

         If any provision of any of the Credit Documents is determined to be
illegal, invalid or unenforceable, such provision shall be fully severable and
the remaining provisions shall remain in full force and effect and shall be
construed without giving effect to the illegal, invalid or unenforceable
provisions.

         11.14    FURTHER ASSURANCES.

         The Credit Parties agree, upon the request of the Administrative Agent,
to promptly take such actions, as reasonably requested, as is necessary to carry
out the intent of this Credit Agreement and the other Credit Documents.

         11.15    ENTIRETY.

         This Credit Agreement together with the other Credit Documents, the Fee
Letter and the Mandate Letter dated June 19, 2000 from Bank of America and BAS
to the Borrower represent the entire agreement of the parties hereto and
thereto, and supersede all prior agreements and

                                       80

<PAGE>   86

understandings, oral or written, if any, including any commitment letters or
correspondence relating to the Credit Documents or the transactions contemplated
herein and therein.

         11.16    BINDING EFFECT; CONTINUING AGREEMENT.

                  (a) This Credit Agreement shall become effective at such time
         when all of the conditions set forth in Section 5.1 have been satisfied
         or waived by the Lenders and it shall have been executed by the
         Borrower, the Guarantors and the Administrative Agent, and the
         Administrative Agent shall have received copies hereof (telefaxed or
         otherwise) which, when taken together, bear the signatures of each
         Lender, and thereafter this Credit Agreement shall be binding upon and
         inure to the benefit of the Borrower, the Guarantors, the
         Administrative Agent and each Lender and their respective successors
         and assigns. Upon this Credit Agreement becoming effective the Existing
         Credit Agreements shall be deemed terminated and the Credit Parties and
         the lenders party to the Existing Credit Agreements shall no longer
         have any obligations thereunder (other than those obligations of the
         Credit Parties in the Existing Credit Agreements that expressly survive
         the termination of the Existing Credit Agreements).

                  (b) This Credit Agreement shall be a continuing agreement and
         shall remain in full force and effect until all Loans, interest, fees
         and other Credit Party Obligations have been paid in full and all
         Commitments have been terminated. Upon termination, the Credit Parties
         shall have no further obligations (other than the indemnification
         provisions that survive) under the Credit Documents; provided that
         should any payment, in whole or in part, of the Credit Party
         Obligations be rescinded or otherwise required to be restored or
         returned by the Administrative Agent or any Lender, whether as a result
         of any proceedings in bankruptcy or reorganization or otherwise, then
         the Credit Documents shall automatically be reinstated and all amounts
         required to be restored or returned and all costs and expenses incurred
         by the Administrative Agent or Lender in connection therewith shall be
         deemed included as part of the Credit Party Obligations.

                                       81

<PAGE>   87

       Each of the parties hereto has caused a counterpart of this Credit
Agreement to be duly executed and delivered as of the date first above written.

BORROWER:
                                   PULTE CORPORATION,
                                   a Michigan corporation

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

<PAGE>   88

GUARANTORS:

                                    ABACOA HOMES, INC.,
                                    a Florida corporation

                                    DIVOSTA AND COMPANY, INC.,
                                    a Florida corporation

                                    DIVOSTA BUILDING CORPORATION,
                                    a Florida corporation

                                    DIVOSTA HOMES, INC.,
                                    a Florida corporation

                                    FLORIDA BUILDING PRODUCTS, INC.,
                                    a Florida corporation

                                    FLORIDA CLUB HOMES, INC.,
                                    a Florida corporation

                                    HAMMOCK RESERVE DEVELOPMENT
                                    COMPANY, a Florida corporation

                                    HOMESITE SOLUTIONS CORPORATION,
                                    a Michigan corporation

                                    ISLAND WALK DEVELOPMENT COMPANY,
                                    a Florida corporation

                                    PB VENTURE L.L.C.,
                                    a Michigan limited liability company

                                    PN II, INC.,
                                    a Nevada corporation

                                    PULTE DEVELOPMENT CORPORATION,
                                    a Michigan corporation

                                    PULTE DIVERSIFIED COMPANIES, INC.,
                                    a Michigan corporation

                                    PULTE FINANCIAL COMPANIES, INC.,
                                    a Michigan corporation

                                    PULTE HOME CORPORATION,
                                    a Michigan corporation

<PAGE>   89

                               PULTE HOME CORPORATION OF NEW
                               ENGLAND, a Michigan corporation

                               PULTE HOME CORPORATION OF THE
                               DELAWARE VALLEY, a Michigan corporation

                               PULTE HOMES OF GREATER KANSAS CITY,
                               INC., a Michigan corporation

                               PULTE HOMES OF MICHIGAN
                               CORPORATION, a Michigan corporation

                               PULTE HOMES OF MINNESOTA
                               CORPORATION, a Minnesota corporation

                               PULTE HOMES OF OHIO CORPORATION,
                               an Ohio corporation

                               PULTE HOMES OF SOUTH CAROLINA, INC.,
                               a Michigan corporation

                               PULTE HOMES OF TEXAS, L.P.,
                               a Texas limited partnership

                                        By:   PN I, INC., a Nevada corporation,
                                              its general partner

                               PULTE LAND DEVELOPMENT
                               CORPORATION, a Michigan corporation

                               PULTE LIFESTYLE COMMUNITIES, INC.,
                               a Michigan corporation

                               PULTE - IN CORPORATION,
                               a Michigan corporation

                               RADNOR HOMES, INC.,
                               a Michigan corporation

                               RIVERWALK OF THE PALM BEACHES
                               DEVELOPMENT COMPANY, INC.,
                               a Florida corporation

                               RN ACQUISITION 2 CORP.,
                               a Nevada corporation

<PAGE>   90

                                SEAN/CHRISTOPHER HOMES, INC.,
                                a Michigan corporation

                                VILLAGE WALK DEVELOPMENT COMPANY,
                                INC., a Florida corporation

                                WIL CORPORATION, a Michigan corporation

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

<PAGE>   91

LENDERS:

                                 BANK OF AMERICA, N.A.,
                                 individually in its capacity as a Lender and
                                 in its capacity as the Administrative Agent

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

<PAGE>   92

                                 BANK ONE, NA,
                                 individually in its capacity as a Lender and
                                 in its capacity as the Syndication Agent

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

<PAGE>   93

                                 COMERICA BANK,
                                 individually in its capacity as a Lender and
                                 in its capacity as the Co-Agent

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

<PAGE>   94

                                 SUNTRUST BANK

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

<PAGE>   95

                                  MICHIGAN NATIONAL BANK

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

<PAGE>   96

                                  PNC BANK, NATIONAL ASSOCIATION

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

<PAGE>   97

                                  THE FUJI BANK, LIMITED

                                  By:
                                     ------------------------------------------
                                  Name:
                                       ----------------------------------------
                                  Title:
                                        ---------------------------------------<PAGE>   1
                                                                    EXHIBIT 10.1

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

                                   $25,000,000

                         EQUITY LINE FINANCING AGREEMENT

                                 by and between

                                  CORZON, INC.

                                       and

                        PIMA CAPITAL MANAGEMENT, LIMITED

                                January 25, 2001

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

<PAGE>   2

                                TABLE OF CONTENTS

<TABLE>
<CAPTION>
                                                                                                              PAGE
<S>                                                                                                           <C>
                                                  ARTICLE I
                                             CERTAIN DEFINITIONS

1.1      Defined Terms...........................................................................................1

                                                  ARTICLE II
                                      PURCHASE AND SALE OF COMMON STOCK

2.1      Put Option..............................................................................................5

2.2      Limitation on Investment Amounts........................................................................5

2.3      Mechanics of Notification...............................................................................6

2.4      Closings................................................................................................6

2.5      Termination, Suspension and Modification of Investment Obligation.......................................6

2.6      Other Adjustments to Purchase Price.....................................................................7

                                                 ARTICLE III
                                             CONDITIONS PRECEDENT

3.1      Conditions Precedent to the Obligation of the Company...................................................7

3.2      Conditions Precedent to the Obligation of the Investor..................................................8

3.3      Due Diligence Review...................................................................................10

                                                  ARTICLE IV
                                  REPRESENTATIONS AND WARRANTIES OF INVESTOR

4.1      Authority..............................................................................................13

4.2      No Brokers.............................................................................................13

4.3      Not an Affiliate.......................................................................................13

4.4      Organization and Standing..............................................................................13

4.5      Absence of Conflicts...................................................................................14

4.6      Disclosure: Access to Information......................................................................14

4.7      Compliance with Securities Laws........................................................................14

4.8      Reliance on Own Advisors...............................................................................14

4.9      Capability to Evaluate.................................................................................14

4.10     Investment Experience..................................................................................14

4.11     Accredited Investor....................................................................................15

                                                  ARTICLE V
                                REPRESENTATIONS AND WARRANTIES OF THE COMPANY

5.1      Corporate Organization.................................................................................15
</TABLE>

                                       -i-
<PAGE>   3

                                TABLE OF CONTENTS
                                   (continued)

<TABLE>
<CAPTION>
                                                                                                              PAGE
<S>                                                                                                           <C>
5.2      Capitalization.........................................................................................15

5.3      Subsidiaries...........................................................................................16

5.4      Authorization..........................................................................................16

5.5      No Violation; Consents.................................................................................16

5.6      Compliance With Applicable Law.........................................................................17

5.7      Litigation.............................................................................................17

5.8      SEC Documents, Financial Statements....................................................................18

5.9      No Undisclosed or Contingent Liabilities...............................................................18

5.10     Taxes..................................................................................................19

5.11     Employee Benefit Plans.................................................................................19

5.12     Absence of Certain Changes.............................................................................19

5.13     Environmental Matters..................................................................................20

5.14     Material Contracts.....................................................................................21

5.15     Properties; Encumbrances...............................................................................21

5.16     Insurance..............................................................................................22

5.17     Employee Claims; Labor Matters.........................................................................22

5.18     Material Disclosure....................................................................................22

5.19     Intellectual Property..................................................................................22

5.20     No Undisclosed Events or Circumstances.................................................................23

5.21     Brokers................................................................................................23

5.22     No Violation of Covenants..............................................................................23

5.23     No Integrated Offering.................................................................................23

                                                  ARTICLE VI
                                           COVENANTS OF THE COMPANY

6.1      Compliance.............................................................................................23

6.2      Reservation of Common Stock............................................................................23

6.3      Listing of Common Stock................................................................................24

6.4      Exchange Act Reporting.................................................................................24

6.5      Legends................................................................................................24

6.6      Corporate Existence....................................................................................24

6.7      Additional SEC Documents...............................................................................24
</TABLE>

                                      -ii-
<PAGE>   4

                                TABLE OF CONTENTS
                                   (continued)

<TABLE>
<CAPTION>
                                                                                                              PAGE
<S>                                                                                                           <C>
                                                  ARTICLE VII
                                                  TERMINATION

7.1      Termination............................................................................................24

                                                 ARTICLE VIII
                                               INDEMNIFICATION

8.1      Indemnification........................................................................................25

8.2      Contribution...........................................................................................27

                                                  ARTICLE IX
                                                MISCELLANEOUS

9.1      Costs and Expenses.....................................................................................28

9.2      Notices................................................................................................28

9.3      Governing Law, Jurisdiction and Venue..................................................................29

9.4      Entire Agreement; Amendments and Waivers...............................................................29

9.5      Binding Effect and Assignment..........................................................................30

9.6      Waiver of Immunity.....................................................................................30

9.7      Headings...............................................................................................30

9.8      Execution..............................................................................................30

9.9      Survival; Severability.................................................................................30
</TABLE>

                                      -iii-
<PAGE>   5

                         EQUITY LINE FINANCING AGREEMENT

         This EQUITY LINE FINANCING AGREEMENT, dated as of January 25, 2001 (the
"Agreement"), is by and between CORZON, INC., a Texas corporation (the
"Company"), and PIMA CAPITAL MANAGEMENT, LIMITED, a company governed by the laws
of the Commonwealth of the Bahamas (the "Investor").

                                    RECITALS

         WHEREAS, the parties desire that the Company may issue to the Investor,
and, upon the terms and subject to the conditions contained herein, the Investor
shall purchase from the Company, from time to time as provided herein, shares of
the Company's common stock, $0.001 par value per share (the "Common Stock"), for
a maximum aggregate Purchase Price of Twenty-Five Million Dollars ($25,000,000)
(the "Maximum Offering Amount");

         WHEREAS, the shares of Common Stock to be issued and sold pursuant to
the terms of this Agreement are being offered and sold pursuant to a private
placement under Section 4(2) of the Securities Act of 1933, as amended.

         NOW, THEREFORE, in consideration of the premises and the mutual
covenants contained herein and other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the Company and the
Investor hereby agree as follows:

                                    ARTICLE I

                               CERTAIN DEFINITIONS

         1.1 Defined Terms. As used in this Agreement (including the recitals
above), the following terms shall have the following meanings specified or
indicated (such meanings to be equally applicable to both the singular and
plural forms of the terms defined):

         "Affiliate" shall mean, with respect to a specified Person, a Person
that directly, or indirectly through one or more intermediaries, controls, or is
controlled by, or is under common control with, such specified Person.

         "Applicable Quantity" shall mean, with respect to each purchase of
Common Stock on a Closing Date pursuant to this Agreement, the number of shares
of Common Stock that is purchased by the Investor, rounded up or down to the
nearest whole number of shares.

         "Balance Sheet" shall mean the unaudited consolidated balance sheet of
the Company as of November 30, 2000.

         "Benefit Plan" shall have the meaning set forth in Section 5.11 hereof.

         "Blocking Event" shall have the meaning set forth in Section 2.5(a)
hereof.

         "Bloomberg" shall mean Bloomberg Financial Press.

                                       1
<PAGE>   6

         "Blue Sky Laws" shall mean the United States state securities and
takeover laws.

         "Calculation Date" shall mean the date that is ten (10) Trading Days
following a Notice Date.

         "Capital Stock" shall mean any and all shares, interests,
participations or other equivalents (however designated) of corporate stock or
any and all equivalent ownership interests in a Person (other than a
corporation).

         "Closing" shall mean the consummation of each purchase and sale of
Common Stock pursuant to Section 2.4 hereof.

         "Closing Date" shall mean the date that is ten (10) Trading Days
following a Notice Date.

         "Code" shall mean the Internal Revenue Code of 1986, as amended.

         "Commitment Period" shall mean the period commencing on the date hereof
and expiring on the earliest to occur of (a) the election by the Company or the
Investor to terminate this Agreement pursuant to Section 7.1 herein, (b) the
date on which the Investor shall have made purchases of Common Stock pursuant to
this Agreement with an aggregate Purchase Price of Twenty-Five Million Dollars
($25,000,000) or such lesser maximum purchase amount as determined pursuant to
Section 2.2, (c) the date this Agreement is terminated pursuant to Section 2.5
or (d) the date occurring thirty six (36) months (subject to extension as
expressly provided herein) after the date of this Agreement.

         "Common Stock" shall have the meaning set forth in the first recital of
this Agreement.

         "Company Assets" shall have the meaning set forth in Section 5.15
hereof.

         "Compensation Plans" shall mean any stock or option or similar
equity-based compensation plans.

         "Condition Satisfaction Date" shall have the meaning set forth in
Section 3.2 hereof.

         "Disclosure Schedule" shall mean a disclosure schedule, delivered by
the Company to the Investor on the date of this Agreement and attached hereto as
Exhibit A, concerning the representations and warranties of the Company set
forth in Article 5 of this Agreement.

         "Dollars," "$" or "U.S.$" shall mean United States dollars.

         "Effective Date" shall mean such date as all of the three following
conditions shall have occurred: (i) the Company shall have delivered the fully
executed Transaction Documents, (ii) the Company shall have indicated to the
Investor in writing that the Exhibits to this Agreement are in final form and
delivered originally executed copies of such Exhibits to the Investor, and (iii)
the Registration Statement shall have become effective.

         "Environmental Laws" shall mean all federal, state, local and foreign
laws and regulations primarily relating to pollution or the environment
(including, without limitation,

                                       2
<PAGE>   7

ambient air, surface water, ground water, land surface or subsurface strata),
including, without limitation, laws and regulations primarily relating to
emissions, discharges, releases or threatened releases of Materials of
Environmental Concern, or otherwise primarily relating to the manufacture,
processing, distribution, use, treatment, storage, disposal, transport or
handling of Materials of Environmental Concern.

         "Exchange Act" shall mean the Securities Exchange Act of 1934, as
amended, together with the rules and regulations promulgated thereunder.

         "GAAP" shall have the meaning set forth in Section 5.8.

         "Governmental Entity" shall mean any federal, state, local or foreign
legislative body, court, government, department or instrumentality, or
governmental, administrative or regulatory authority or agency.

         "Investment Amount" shall mean, with respect to any purchase of shares
of Common Stock on a Closing Date under this Agreement, the product of the
Purchase Price and the Applicable Quantity.

         "Investor" shall have the meaning set forth in the introduction to this
Agreement.

         "Knowledge of the Company" shall mean the actual knowledge, without
independent inquiry, of any of the executive officers of the Company.

         "Knowledge of the Investor" shall mean the actual knowledge, without
independent inquiry, of any person executing this agreement on behalf of the
Investor.

         "Liens" shall have the meaning set forth in Section 5.15 hereof.

         "Material Adverse Effect" shall mean any effect on the business,
operations, properties, financial condition or prospects of the Company which is
material and adverse to the Company or to the Company and any other entities
controlled by the Company, taken as a whole, or any condition or situation which
could prohibit, impair or otherwise interfere with the ability of the Company to
enter into and perform its obligations under the Transaction Documents;
provided, however, that Material Adverse Effect shall exclude any effect
resulting from or related to changes or developments involving (1) a prospective
change arising out of any proposed or adopted legislation, or any other proposal
or enactment by any governmental, regulatory or administrative authority, (2)
general conditions applicable to the global economy, including changes in
interest rates, (3) conditions or effects resulting from the announcement of the
existence or terms of this Agreement or (4) conditions affecting the global
telecommunications industry, in each case taken as a whole.

         "Materials of Environmental Concern" shall mean hazardous substances as
defined under the Comprehensive Environmental Response, Compensation and
Liability Act, 42 U.S.C. Section 9601 et seq. and hazardous wastes as defined
under the Resource Conservation and Recovery Act, 42 U.S.C. Section 6901,
et seq. and petroleum and petroleum products and such other chemicals,

                                       3
<PAGE>   8

materials or substances as are listed as "hazardous wastes", "hazardous
materials", "toxic substances", or words of similar import under any similar
federal, state, local or foreign laws.

         "Maximum Offering Amount" shall have the meaning set forth in the first
recital of this Agreement.

         "NASD" shall mean the National Association of Securities Dealers, Inc.

         "Notice Date" shall mean, with respect to each purchase and sale of
Common Stock pursuant to this Agreement, a Trading Day (which shall be no less
than ten (10) Trading Days following the previous Notice Date, if any) on which
the Company delivers to the Investor a Put Notice.

         "Payment Date" shall mean the first Business Day following a Closing
Date.

         "Person" shall mean an individual, partnership, corporation, limited
liability company, trust or unincorporated organization, or a government or
agency or subdivision thereof.

         "Principal Market" shall mean the New York Stock Exchange, the American
Stock Exchange, the Nasdaq National Market, the Nasdaq Small Cap Market, the
National Association of Securities Dealers Over the Counter Bulletin Board
Quotation System or any similar organization or agency succeeding such market or
exchange's functions of reporting prices, whichever is at the time the principal
United States trading exchange or market for the Common Stock.

         "Prospectus" shall mean the prospectus included in any Registration
Statement, as amended or supplemented by any Prospectus supplement, including
post-effective amendments, and all material incorporated by reference in such
Prospectus.

         "Purchase Price" shall have the meaning set forth in Section 2.4(b)
hereof.

         "Put Notice" shall have the meaning set forth in Section 2.3 hereof.

         "Registration Statement" shall have the meaning set forth in Section
3.2(a) hereof.

         "Representatives" shall have the meaning set forth in Section 3.3(a)
hereof.

         "SEC" shall mean the Securities and Exchange Commission.

         "SEC Documents" shall have the meaning set forth in Section 5.8 hereof.

         "Securities Act" shall mean the Securities Act of 1933, as amended.

         "Subsidiary" shall mean, with respect to any Person, any corporation,
limited or general partnership, trust, association or other business entity of
which 50% or more of the outstanding Capital Stock or other interests entitled
to vote (irrespective of whether, at the time, Capital Stock of any other class
or classes of such corporation shall have or might have voting power by reason
of the happening of any contingency) in the election of the board of directors,
managers,

                                       4
<PAGE>   9

trustees or other controlling persons, or an equivalent controlling interest
therein, of such Person is, at the time, directly or indirectly, owned by such
Person and/or one or more Subsidiaries of such Person.

         "Tax Return" shall mean any report, return, information statement or
other information required to be supplied to any federal, state, local or
foreign taxing authority, or any election permitted to be made, in connection
with Taxes.

         "Taxes" shall mean all taxes, charges, fees, levies, duties or other
assessments, including without limitation all net income, gross income, gross
receipts, franchise, value added, sales, use, property, ad valorem, transfer,
withholding, profits, license, employee, payroll, social security, unemployment,
excise, estimated, severance and any other taxes, duties, withholdings, fees,
assessments or charges of any kind whatsoever, including any interest, penalties
or additional amounts attributable thereto, imposed by any federal, state, local
or foreign taxing authority.

         "Trading Day" shall mean any day during which the Principal Market
shall be open for business and on which trading of the Common Stock on the
Principal Market shall not have been suspended or limited.

         "Transaction Documents" shall mean this Agreement and any other
documents required to be delivered in connection with this transaction.

         "Weighted Volume" shall mean, on any given Trading Day, the product of
(a) the closing bid price for the Common Stock on the Principal Market during
such Trading Day, as reported by Bloomberg multiplied by (b) the volume of the
Common Stock on the Principal Market.

                                   ARTICLE II

                        PURCHASE AND SALE OF COMMON STOCK

         2.1 Put Option. Subject to the terms and conditions set forth in this
Agreement (including, without limitation, the provisions of Article 3 hereof),
if the Company elects to deliver a Put Notice to the Investor during the
Commitment Period in accordance with Section 2.3 hereof, then upon the delivery
of such Put Notice, the Investor shall be obligated to purchase from the Company
shares of Common Stock on the Closing Date specified therein for an Investment
Amount specified therein, which Investment Amount (i) shall not exceed the
lesser of (A) One Million Dollars ($1,000,000) or (B) 150% of the average of the
Weighted Volume for the ten (10) Trading Days preceding the Notice Date, as
reported on Bloomberg and (ii) shall not be less than Fifty Thousand Dollars
($50,000).

         2.2 Limitation on Investment Amounts. The Investor shall not be
obligated under Section 2.1 hereof to purchase an aggregate dollar amount of
Common Stock that exceeds the Maximum Offering Amount.

                                       5
<PAGE>   10

         2.3 Mechanics of Notification.

                  (a) Put Notice. On any Notice Date, unless otherwise agreed by
the parties to this Agreement, the Chief Executive Officer or the Chief
Financial Officer of the Company (or such other person as designated by either
in writing) may, at the Company's sole discretion, deliver a written notice to
the Investor (each such notice being a "Put Notice") which specifies the
Investment Amount and the Calculation Date for determining the Applicable
Quantity to be purchased by the Investor on the Closing Date specified therein.

                  (b) Date of Delivery of Notices. A Put Notice sent by the
Company to the Investor shall be deemed to be delivered on the Trading Day it is
(A) transmitted by facsimile with confirmation of facsimile acceptance or (B)
otherwise received in writing via courier, hand delivery or first-class mail
(return receipt requested) by the Investor, or, if received (i) on any day which
is not a Trading Day or (ii) after 12:00 p.m., Eastern time, shall be deemed to
be delivered on the immediately succeeding Trading Day.

         2.4 Closings.

                  (a) Deliveries at Closings. On or prior to each Closing Date,
each of the Company and the Investor shall deliver all documents, certificates,
instruments and writings required to be delivered or reasonably requested by
either of them pursuant to this Agreement in order to implement and effect the
transactions contemplated herein.

                  (b) Purchase Price Per Share. The purchase price per share of
the Company's Common Stock (the "Purchase Price") shall be determined on the
Calculation Date as an amount equal to Ninety-two Percent (92%) of the simple
average of the closing bid prices of the Common Stock over the ten (10) Trading
Days beginning on the Notice Date, as reported on Bloomberg.

         2.5 Termination, Suspension and Modification of Investment Obligation.

                  (a) Blocking Events. The Investor shall not be required to
(but may elect to, in its sole and absolute discretion), purchase any shares of
Common Stock from the Company on any Closing Date pursuant to a Put Notice
delivered at any time during the Commitment Period when there shall exist any
one or more of the following: (A) the withdrawal of the effectiveness of the
Registration Statement, (B) the Company's failure to satisfy the requirements of
Section 3.2 or 3.3, or (C) any failure or interruption in the compliance by the
Company with the covenants provided in Article 6 (each of (A), (B), and (C), a
"Blocking Event").

                  (b) Additional Events of Termination of Investor Obligation.
The obligation of the Investor to purchase shares of Common Stock under this
Agreement may, if the Investor in its sole and absolute discretion so elects, be
terminated in the event that (i) there shall occur any stop order or suspension
of the effectiveness of the Registration Statement, or any withdrawal of the
effectiveness of the Registration Statement for a period greater than twenty
(20) Trading Days for any reason other than as a result of subsequent corporate
developments which would require such Registration Statement to be amended to
reflect such event in order to maintain its compliance with the disclosure
requirements of the Securities Act; or (ii) the

                                       6
<PAGE>   11

Company shall, at any time, fail to comply with the requirements of Sections
6.2, 6.3, 6.4, 6.5 or 6.6 and the Company shall fail to cure such noncompliance
within: (A) (1) if the noncompliance relates to a failure to comply with the
provisions of Sections 6.3, 6.4, 6.5 or 6.6, thirty (30) calendar days after
receipt of notice from the Investor of its election to terminate this Agreement
or (2) if the noncompliance relates to a failure to comply with the provisions
of Section 6.2, ninety (90) calendar days after receipt of notice from the
Investor of its election to terminate this Agreement; provided in either case
that the Investor has been notified by the Company of such noncompliance within
five (5) Trading Days of the Chief Executive Officer, Chief Financial Officer or
Treasurer of the Company having become aware of the occurrence of such
noncompliance or, if the noncompliance relates to a failure of the Company to
comply with the provisions of Section 6.6, the Investor otherwise becomes aware
of such noncompliance or (B) otherwise within five (5) Trading Days of the Chief
Executive Officer, Chief Financial Officer or Treasurer of the Company having
become aware of the occurrence of such noncompliance; provided, however, that
notwithstanding the foregoing, the Investor may, in its sole and absolute
discretion, terminate this Agreement if the Company shall fail to maintain the
listing of the Common Stock on a Principal Market, or if trading of the Common
Stock on a Principal Market shall have been suspended for a period of ten (10)
consecutive Trading Days.

                  (c) Put Limitation. Notwithstanding the provisions hereof or
any prior agreement between the Investor and the Company, in no event shall the
Company deliver a Put Notice to the Investor for an Investment Amount that would
obligate the Investor to purchase, at any one Closing, a number of shares of
Common Stock equal to more than 4.99% of the outstanding shares of Common Stock.

         2.6 Other Adjustments to Purchase Price. The Purchase Price shall be
adjusted proportionally to reflect any stock splits, stock dividends,
reclassifications, redenominations, combinations and similar transactions
involving the Company's Common Stock.

                                   ARTICLE III

                              CONDITIONS PRECEDENT

         3.1 Conditions Precedent to the Obligation of the Company. The
obligation hereunder of the Company to issue and sell Common Stock to the
Investor incident to each Closing is subject to the satisfaction, at or before
each such Closing, of each of the conditions set forth below, which conditions
cannot be waived without the prior written consent of the Company:

                  (a) Accuracy of the Investor's Representations and Warranties.
The representations and warranties of the Investor set forth in this Agreement
shall be true and correct in all material respects as of the date of each such
Closing as though made at each such time.

                  (b) Performance by the Investor. The Investor shall have
performed, satisfied and complied in all material respects with all covenants,
agreements and conditions required by this Agreement to be performed, satisfied
or complied with by the Investor at or prior to such Closing.

                                       7
<PAGE>   12

                  (c) No Injunction. No statute, rule, regulation, executive
order, decree, ruling or injunction shall have been enacted, entered,
promulgated or endorsed by any court or governmental authority of competent
jurisdiction which prohibits or adversely affects any of the transactions
contemplated by this Agreement, and no proceeding shall have been commenced
which would be reasonably likely to have the effect of prohibiting or adversely
affecting any of the transactions contemplated by this Agreement.

         3.2 Conditions Precedent to the Obligation of the Investor. The right
of the Company to deliver a Put Notice and the obligation of the Investor
hereunder to acquire and pay for Common Stock incident to a Closing is subject
to the satisfaction, on the date of delivery of a Put Notice, and on the
applicable Closing Date (each a "Condition Satisfaction Date") of each of the
following conditions, which conditions may be waived with the prior written
consent of the Investor:

                  (a) Registration of the Common Stock with the SEC. The Company
shall have filed with the SEC a registration statement on Form S-1, Form S-3,
Form SB-2, any successor form thereto or other appropriate form (the
"Registration Statement") for the registration of the resale of the Common Stock
to be acquired pursuant to this Agreement under the Securities Act. Furthermore,
the Company shall have filed (i) with Standard & Poor's, Ltd. a "blanket filing"
to comply with the blue sky laws of those states that are customarily covered by
such a filing and (ii) any filings required to be made by the Company with the
NASD and/or Principal Market.

                  (b) Effective Registration Statement. The Registration
Statement shall be in effect and shall remain effective on each Condition
Satisfaction Date and (i) neither the Company nor the Investor shall have
received notice that the SEC has issued (and not subsequently withdrawn) or
intends to issue a stop order with respect to the Registration Statement or that
the SEC otherwise has suspended or withdrawn the effectiveness (and not
reinstated the effectiveness) of the Registration Statement, either temporarily
or permanently, or intends or has threatened to do so, and (ii) no other
suspension of the use of the Registration Statement or related Prospectus shall
exist.

                  (c) Accuracy of the Company's Representations and Warranties.
The representations and warranties of the Company as set forth in the
Transaction Documents shall be true and correct in all material respects as of
each Condition Satisfaction Date as though made at each such time (except for
representations and warranties made as of a specific date).

                  (d) Performance by the Company. The Company shall have
performed, satisfied and complied with in all material respects all covenants,
agreements and conditions required by the Transaction Documents to be performed,
satisfied or complied with by the Company at or prior to each Condition
Satisfaction Date.

                  (e) No Injunction. No statute, rule, regulation, executive
order, decree, ruling or injunction shall have been enacted, entered,
promulgated or endorsed by any court or governmental authority of competent
jurisdiction which prohibits or adversely affects any of the transactions
contemplated by this Agreement, and no proceeding shall have been commenced
which may have the effect of prohibiting or adversely affecting any of the
transactions contemplated by this Agreement.

                                       8
<PAGE>   13

                  (f) Adverse Changes. Since the Most Recent SEC Report (as
hereinafter defined), no event which had or is reasonably likely to have a
Material Adverse Effect has occurred, except as disclosed in the SEC Documents
or Company press releases subsequent to such date or as otherwise publicly
disclosed.

                  (g) No Suspension of Trading In or Delisting of Common Stock.
The trading of the Common Stock shall not have been suspended by the SEC, the
Principal Market or the NASD, and the Common Stock shall have been approved for
listing or quotation on and shall not have been delisted from the Principal
Market, without becoming listed on another Principal Market.

                  (h) Shareholder Vote. The issuance of shares of Common Stock
with respect to the applicable Closing, if any, shall not violate the
shareholder approval requirements of the Principal Market.

                  (i) Legal Opinions. The Company shall have caused to be
delivered to the Investor, within five (5) Trading Days following (i) the
effective date of the Registration Statement and (ii) the delivery by the
Company of a Put Notice, a letter of the Company's counsel (whether in-house or
independent), which Counsel shall be reasonably satisfactory to the Investor,
addressed to the Investor and stating, inter alia, that, without independently
checking the accuracy of or completeness of, or otherwise verifying any
statements of fact contained in the Registration Statement, no facts have come
to such counsel's attention that has caused it to believe that the Registration
Statement (as amended, if applicable), contains an untrue statement of material
fact required to be stated therein, or omits a material fact, required to make
the statements contained therein not misleading or that the underlying
Prospectus (if applicable, as so amended or supplemented) contains an untrue
statement of material fact or omits a material fact required to make the
statements contained therein, in light of the circumstances in which they were
made, not misleading (except that no confirmation need to be provided with
respect to the financial statements, notes thereto and related schedules and
other financial information contained in the Registration Statement or omitted
therefrom); provided, however, that in the event that such a letter cannot be
delivered by the Company's counsel to the Investor, the Company shall promptly
notify the Investor and promptly revise the Registration Statement, and the
Company shall not deliver a Put Notice or, if a Put Notice shall have been
delivered in good faith without knowledge by the Company that a letter of
counsel cannot be delivered as required, shall postpone, if necessary, any
pending Closing Date for a period of up to five (5) Trading Days until such a
letter is delivered to the Investor (or such Closing shall otherwise be
canceled). In the event of such a postponement, the Purchase Price of the Common
Stock to be issued at such Closing as determined pursuant to Section 2.4 shall
be the lower of such Purchase Price as calculated as of the originally scheduled
Closing Date or calculated as of the actual Closing Date.

                  (j) Accountant's Letter.

                           (i) The Company shall have caused its independent
                  auditors to furnish with respect to the Company's Forms 10-Q
                  and Forms 10-K a comfort letter in customary form, including a
                  statement to the effect that they have performed the
                  procedures in accordance with the provisions of Statement on
                  Auditing Standards

                                       9
<PAGE>   14

                  No. 71, as amended, as agreed to by the parties hereto, and
                  reports thereon as shall have been reasonably requested by the
                  Investor with respect to certain financial information
                  contained in the Registration Statement.

                           (ii) In the event that the Investor shall have
                  requested delivery of an "agreed upon procedures" report
                  pursuant to Section 3.3, the Company shall engage its
                  independent auditors to perform certain agreed upon procedures
                  and report thereon as shall have been reasonably requested by
                  the Investor with respect to certain financial information of
                  the Company and the Company shall deliver to the Investor a
                  copy of such report addressed to the Investor.

                           (iii) In the event that a report required by this
                  Section 3.2 cannot be delivered by the Company's independent
                  auditors, the Company shall, if necessary, promptly revise the
                  Registration Statement and the Company shall not deliver a Put
                  Notice or, if a Put Notice shall have been delivered in good
                  faith without knowledge by the Company that a report of its
                  independent auditors cannot be delivered as required, postpone
                  such Closing Date for a period of up to five (5) Trading Days
                  until such a report is delivered (or such Closing shall
                  otherwise be canceled). In the event of such a postponement,
                  the Purchase Price of the Common Stock to be issued at such
                  Closing as determined pursuant to Section 2.4 shall be the
                  lower of such Purchase Price as calculated as of the
                  originally scheduled Closing Date and as of the actual Closing
                  Date.

                  (k) Officer's Certificate. The Company shall have delivered to
the Investor, on each Closing Date, a certificate in form and substance
reasonably acceptable to the Investor, executed by an executive officer of the
Company, to the effect that all the conditions to such Closing to be met by the
Company shall have been satisfied as at the date of each such certificate.

                  (l) Due Diligence. No dispute between the Company and the
Investor shall exist pursuant to Section 3.3 as to the adequacy of the
disclosure contained in the Registration Statement.

                  (m) Average Weighted Volume. The average of the Weighted
Volume for the ten (10) Trading Days preceding the Notice Date, with respect to
each Closing, shall be at least Thirty Three Thousand Three Hundred and Thirty
Three Dollars ($33,333).

                  (n) Effective Merger. The merger of LecStar Acquisition
Corporation, a Delaware corporation and a wholly-owned subsidiary of the
Company, with and into LecStar Communication Corporation, a Delaware
corporation, shall have been filed with the Secretary of State of Delaware and
such merger shall have been effectuated.

         3.3 Due Diligence Review.

                  (a) Availability of Information. Subject to applicable laws
and regulations and Section 3.3(b), the Company shall make available, during
normal business hours, for inspection and review by the Investor and its
Affiliates, external legal advisors and independent

                                       10
<PAGE>   15

accountants (which counsel and accountants shall be reasonably acceptable to the
Company and, together with the Affiliates of the Investor, are referred to
herein as "Representatives"), all financial and other records, all SEC Documents
and other filings with the SEC, and all other corporate documents and properties
of the Company as may be reasonably necessary for the purpose of such review,
and cause the Company's officers, directors and employees, within a reasonable
time period, to supply all such information reasonably requested by the Investor
or any of its Representatives in connection with such Registration Statement
(including, without limitation, in response to all questions and other inquiries
reasonably made or submitted by any of them), prior to and from time to time
after the filing and effectiveness of the Registration Statement for the sole
purpose of enabling the Investor and such Representatives to conduct initial and
ongoing due diligence with respect to the Company and the accuracy of the
Registration Statement. Notwithstanding the foregoing, the Investor and its
Representatives shall be allowed to disclose the information described above to
any securities regulator in connection with an examination by such regulator of
the Investor.

                  (b) Nonpublic Information.

                           (i) The Company shall not disclose nonpublic
                  information to the Investor, advisors to or representatives of
                  the Investor unless, prior to disclosure of such information,
                  the Company identifies such information as being nonpublic
                  information and provides the Investor, such advisors and
                  representatives with the opportunity to accept or refuse to
                  accept such nonpublic information for review. The Company may,
                  as a condition to disclosing any nonpublic information
                  hereunder, require the Investor, the Investor's advisors and
                  representatives to enter into a confidentiality agreement
                  (including an agreement with such advisors and representatives
                  prohibiting them from trading in Common Stock during such
                  period of time as they are in possession of nonpublic
                  information) in form reasonably satisfactory to the Company
                  and the Investor.

                           (ii) Nothing herein shall require the Company to
                  disclose nonpublic information to the Investor or its advisors
                  or representatives, and the Company represents that it does
                  not disseminate nonpublic information to any investors who
                  purchase stock in the Company in a public offering, to money
                  managers or to securities analysts; provided, however, that
                  notwithstanding anything herein to the contrary, the Company
                  will, as hereinabove provided, immediately notify the advisors
                  and representatives of the Investor and, if any, underwriters,
                  of any event or the existence of any circumstance (without any
                  obligation to disclose the specific event or circumstance) of
                  which it becomes aware, constituting nonpublic information
                  (whether or not requested of the Company specifically or
                  generally during the course of due diligence by any such
                  persons or entities), which, if not disclosed in the
                  Prospectus included in the Registration Statement, would cause
                  such Prospectus to include a material misstatement or to omit
                  a material fact required to be stated therein in order to make
                  the statements therein, in light of the circumstances in which
                  they were made, not misleading. Nothing contained in this
                  Section 3.3 shall be construed to mean that such persons or
                  entities other than the Investor (without the written consent
                  of the Investor prior to disclosure of

                                       11
<PAGE>   16

                  such information) may not obtain nonpublic information in the
                  course of conducting due diligence in accordance with the
                  terms of this Agreement; provided, however, that in no event
                  shall the Investor's advisors or representatives disclose to
                  the Investor the nature of the specific event or circumstances
                  constituting any nonpublic information discovered by such
                  advisors or representatives in the course of their due
                  diligence without the written consent of the Investor prior to
                  disclosure of such information. The Investor's advisors or
                  representatives shall make complete disclosure to the
                  Investor's independent counsel of all events or circumstances
                  constituting nonpublic information discovered by such advisors
                  or representatives in the course of their due diligence upon
                  which such advisors or representatives form the opinion that
                  the Registration Statement contains an untrue statement of a
                  material fact or omits a material fact required to be stated
                  in the Registration Statement or necessary to make the
                  statements contained therein, in the light of the
                  circumstances in which they were made, not misleading. Upon
                  receipt of such disclosure, the Investor's independent counsel
                  shall consult with the Company's independent counsel in order
                  to address the concern raised as to the existence of a
                  material misstatement or omission and to discuss appropriate
                  disclosure with respect thereto; provided, however, that such
                  consultation shall not constitute the advice of the Company's
                  independent counsel to the Investor as to the accuracy of the
                  Registration Statement and related Prospectus. In the event
                  after such consultation the Investor's independent counsel
                  reasonably believes that the Registration Statement contains
                  an untrue statement of a material fact or omits a material
                  fact required to be stated in the Registration Statement or
                  necessary to make the statements contained therein, in light
                  of the circumstances in which they were made, not misleading,
                  (A) the Company shall file with the SEC an amendment to the
                  Registration Statement responsive to such alleged untrue
                  statement or omission and provide the Investor, as promptly as
                  practicable, with copies of the Registration Statement and
                  related Prospectus, as so amended, (B) if the Company disputes
                  the existence of any such material misstatement or omission,
                  and (1) the dispute relates to information other than
                  financial statements, schedules and other financial or
                  statistical information included or incorporated by reference
                  therein, the Company's independent counsel shall provide the
                  Investor's independent counsel with a letter (customary in
                  form and scope as provided to an underwriter in an
                  underwritten public offering) stating that, without
                  independently checking the accuracy or completeness of, or
                  otherwise verifying, any statements of fact contained in the
                  Registration Statement, nothing has come to their attention
                  that would lead them to believe that the Registration
                  Statement or the related Prospectus, as of the date of such
                  letter, contains an untrue statement of a material fact or
                  omits a material fact required to be stated in the
                  Registration Statement or the related Prospectus or necessary
                  to make the statements contained therein, in light of the
                  circumstances in which they were made, not misleading or (2)
                  in the event the dispute relates to the adequacy of financial
                  disclosure and the Investor shall reasonably request, the
                  Company's independent auditors shall provide to the Company a
                  letter outlining the performance of such "agreed upon
                  procedures" as shall be reasonably requested

                                       12
<PAGE>   17

                  by the Investor and the Company shall provide the Investor
                  with a copy of such letter, or (C) if the Company disputes the
                  existence of any such material misstatement or omission, and
                  the dispute relates to the timing of disclosure of a material
                  event and the Company's independent counsel is unable to
                  provide the letter referenced in clause (B)(1) above to the
                  Investor, then this Agreement shall be suspended for a period
                  of up to forty-five (45) calendar days and, at the end of
                  which, if the dispute still exists between the Company's
                  independent counsel and the Investor's independent counsel,
                  either (x) the Company shall amend the Registration Statement
                  as provided above or provide to the Investor the Company's
                  independent counsel letter or a copy of the letter of the
                  Company's independent auditors referenced above, as
                  applicable, or (y) the obligation of the Investor to purchase
                  shares of Common Stock pursuant to this Agreement shall
                  terminate.

                                   ARTICLE IV

                   REPRESENTATIONS AND WARRANTIES OF INVESTOR

         The Investor represents and warrants to the Company as follows:

         4.1 Authority. The Investor has full power and authority to execute and
deliver the Transaction Documents and to consummate the transactions
contemplated hereby and thereby in accordance with the terms hereof and thereof.
The execution and delivery of this Agreement and the consummation of the
transactions contemplated hereby have been duly authorized by the Investor. No
other proceedings on the part of Investor are necessary to approve and authorize
the execution and delivery of this Agreement and the consummation of the
transactions contemplated hereby in accordance with the terms hereof. This
Agreement has been validly executed and delivered by the Investor and is a valid
and binding agreement of the Investor enforceable against it in accordance with
its terms, subject to applicable bankruptcy, insolvency or similar laws relating
to, or affecting generally the enforcement of, creditors' rights and remedies or
by other equitable principles of general application.

         4.2 No Brokers. The Investor has taken no action that would give rise
to any claim by any person for brokerage commission, finder's fees or similar
payments by the Company relating to this Agreement or the transactions
contemplated hereby.

         4.3 Not an Affiliate. The Investor is not an officer, director or
Affiliate of the Company.

         4.4 Organization and Standing. The Investor is a limited liability
company duly organized and validly existing under, and is governed by, the laws
of the Cayman Islands and has all requisite power and authority as a limited
liability company to carry on its business as now being conducted, and is duly
qualified to do business and in good standing in each jurisdiction in which the
nature of the business conducted by it makes such qualifications necessary,
except where the failure to be so qualified or in good standing would not
reasonably be expected to have a material adverse effect.

                                       13
<PAGE>   18

         4.5 Absence of Conflicts. The execution and delivery of this Agreement
and any other document or instrument executed in connection herewith, and the
consummation of the transactions contemplated hereby and thereby, and compliance
with the requirements hereof and thereof, will not violate any law, rule,
regulation, order, writ, judgment, injunction, decree or award binding on the
Investor, or the provision of any indenture, instrument or agreement to which
the Investor is a party or is subject, or by which the Investor or any of its
assets is bound, or conflict with or constitute a material default thereunder,
or result in the creation or imposition of any lien pursuant to the terms of any
such indenture, instrument or agreement, or constitute a breach of any fiduciary
duty owed by the Investor to any third party, or require the approval of any
third party (which has not been obtained) pursuant to any material contract,
agreement, instrument, relationship or legal obligation to which the Investor is
subject or to which any of its assets, operations or management may be subject.

         4.6 Disclosure: Access to Information. The Investor has received all
documents, records, books and other information pertaining to the Investor's
investment in the Company that have been requested by the Investor. The Investor
further acknowledges that it understands that the Company is subject to the
periodic reporting requirements of the Exchange Act, and the Investor has
reviewed or received copies of any such reports that have been requested by it
and that it considers necessary or appropriate for deciding whether to enter
into this Agreement and perform its obligations hereunder. The Investor further
represents that it had an opportunity to ask questions and receive answers from
the Company regarding the terms and conditions of the purchase of the Common
Stock and the business, properties, prospects and financial condition of the
Company.

         4.7 Compliance with Securities Laws. The Investor acknowledges and
agrees that any transactions in the Common Stock effected by the Investor shall
comply with all applicable securities laws.

         4.8 Reliance on Own Advisors. Investor has relied completely on the
advice of, or has consulted with, Investor's own personal tax, investment, legal
or other advisors and has not relied on the Company or any of its Affiliates,
officers, directors, attorneys, accountants or any Affiliates of any thereof and
each other person, if any, who controls any of the foregoing, within the meaning
of Section 15 of the Act, for any tax or legal advice (other than reliance on
information in the Company's filings with the SEC and on the opinion of counsel
delivered in connection herewith by counsel to the Company). The foregoing,
however, does not limit or modify Investor's right to rely upon covenants,
representations and warranties of the Company in this Agreement.

         4.9 Capability to Evaluate. Investor has such knowledge and experience
in financial and business matters so as to enable Investor to utilize the
information made available to it to evaluate the merits and risks of the
prospective investment.

         4.10 Investment Experience. Investor has substantial experience in
investing in securities and it has made investments in securities other than
those of the Company. Investor acknowledges that it has the ability to bear the
economic risk of its investment pursuant to this Agreement.

                                       14
<PAGE>   19

         4.11 Accredited Investor. Investor is an accredited investor, as
defined in Rule 501 of Regulation D promulgated under the Securities Act.

                                    ARTICLE V

                  REPRESENTATIONS AND WARRANTIES OF THE COMPANY

         Except as disclosed in the Disclosure Schedule delivered by the Company
to the Investor on the date hereof or as set forth in reports filed with the
SEC, the Company represents and warrants to the Investor as follows:

         5.1 Corporate Organization. The Company and each of its Subsidiaries is
a corporation duly organized, validly existing and in good standing under the
laws of its jurisdiction of incorporation, and has all requisite corporate power
and authority to own or lease and operate its properties and to carry on its
business as now being conducted, and is duly qualified to do business and in
good standing in each jurisdiction in which the property owned, leased or
operated by it or the nature of the business conducted by it makes such
qualification necessary, except where the failure to be so qualified or in good
standing would not reasonably be expected to have a Material Adverse Effect. The
Company has made available to the Investor or its agents complete and correct
copies of the Articles of Incorporation, as amended, and by-laws of the Company
and each of its Subsidiaries as in effect on the date hereof.

         5.2 Capitalization.

                  (a) As of the date of this Agreement (and immediately prior to
effectiveness of the issuance of common and preferred stock of the Company to
the holders of stock in LecStar Communications Corporation in accordance with
the Company's acquisition of LecStar Communications Corporation that shall be
effective as of the date hereof), the authorized Capital Stock of the Company
consists of (i) 500,000,000 shares of Common Stock and (ii) 5,000,000 shares of
preferred stock, $1.00 par value per share (the "Preferred Stock"). As of the
date of this Agreement, there were (i) 87,524,410 shares of Common Stock issued
and outstanding, all of which are duly authorized and validly issued, fully paid
and nonassessable and (ii) no shares of Common Stock owned by the Company in its
treasury. As of the same date, there were 1,201,478 shares of Preferred Stock
issued and outstanding, all of which are duly authorized and validly issued,
fully paid and nonassessable. No shares of Capital Stock of the Company are
entitled to preemptive rights.

                  (b) Except as set forth in (i) Section 5.2(a) above and (ii)
Schedule 5.2(b), the Company does not have outstanding any Capital Stock or
securities convertible into or exchangeable for any shares of Capital Stock or
any options, warrants or other rights, agreements, arrangements or commitments
of any character to which the Company is a party or otherwise obligating the
Company to issue or sell or entitling any Person to acquire from the Company,
and the Company is not a party to any agreement, arrangement or commitment
obligating it to repurchase, redeem or otherwise acquire, any shares of its
Capital Stock or securities convertible into or exchangeable for any of its
Capital Stock.

                                       15
<PAGE>   20

                  (c) Upon issuance of the Common Stock, and payment of the
Purchase Price therefor, pursuant to a purchase and sale in accordance with the
terms of this Agreement, the Company will transfer to the Investor good and
valid title to the Common Stock, free and clear of any material Lien, other than
Liens, if any, created by the Investor and such Common Stock will be duly
authorized, fully paid and nonassessable.

         5.3 Subsidiaries.

                  (a) The Company does not have any Subsidiaries other than
those listed on Schedule 5.3(a) of the Disclosure Schedule. Except as set forth
in Schedule 5.3(a), each Subsidiary is, directly or indirectly, wholly-owned by
the Company.

                  (b) Except as set forth in Schedule 5.3(b), (i) all the
outstanding stock or other equity or ownership interests of each Subsidiary is
owned free and clear of all material Liens and is validly issued and (ii) there
are no options, warrants or other rights, agreements, arrangements or
commitments of any character to which any Subsidiary is a party or otherwise
obligating any Subsidiary to issue or sell, or entitling any Person to acquire
from any Subsidiary, and no Subsidiary is a party to any agreement, arrangement
or commitment obligating it to repurchase, redeem or otherwise acquire, any
shares of the Capital Stock or any securities convertible into or exchangeable
for the Capital Stock of any such Subsidiary.

         5.4 Authorization. The Company has full corporate power and authority
to execute and deliver the Transaction Documents, to issue the Common Stock
pursuant to this Agreement, and to consummate the transactions contemplated
hereby and thereby in accordance with the terms hereof and thereof. The
execution and delivery of the Transaction Documents, and the issuance of the
Common Stock issuable upon a Closing, and the consummation of the transactions
contemplated hereby and thereby have been duly authorized by the Board of
Directors of the Company. To the Knowledge of the Company, no other corporate
proceedings on the part of the Company are necessary to approve and authorize
the execution and delivery of the Transaction Documents, and the issuance of the
Common Stock issuable upon a Closing, and the consummation of the transactions
contemplated hereby and thereby in accordance with the terms hereof and thereof.
The Transaction Documents have been duly executed and delivered by the Company,
and the Common Stock issuable in accordance with the terms of this Agreement,
upon the payment of the purchase price therefor in accordance with the terms
hereof and thereof, will be duly and validly issued, fully paid and
nonassessable. Each of the Transaction Documents constitutes valid and binding
obligations of the Company enforceable against the Company in accordance with
their terms, subject to applicable bankruptcy, insolvency or similar laws
relating to, or affecting generally the enforcement of, creditors' rights and
remedies or by other equitable principles of general application.

         5.5 No Violation; Consents.

                  (a) Assuming the making or receipt of all filings, notices,
registrations, consents, approvals, permits and authorizations described in this
Section 5.5, the execution and delivery of the Transaction Documents, and the
consummation of the transactions contemplated hereby and thereby, the compliance
by the Company with any of the provisions hereof and thereof will not (i)
conflict with, violate or result in any breach of the Articles of Incorporation,

                                       16
<PAGE>   21

as amended, or by-laws of the Company or its Subsidiaries, (ii) result in a
violation or breach of, or constitute (with or without due notice or lapse of
time or both) a default or give rise to any right of termination, cancellation
or acceleration under, or result in the creation of any Lien on or against any
of the properties of the Company or any of its Subsidiaries pursuant to any of
the terms or conditions of any note, bond, mortgage, indenture, license,
agreement or other instrument or obligation to which the Company or any of its
Subsidiaries is a party or by which any of them or any of their properties or
assets may be bound, or (iii) violate any statute, law, rule, regulation, writ,
injunction, judgment, order or decree of any Governmental Entity, binding on the
Company or any of its Subsidiaries or any of their properties or assets,
excluding from the foregoing clauses (i), (ii) and (iii) conflicts, violations,
breaches, defaults, rights of termination, cancellation or acceleration, and
liens which, individually or in the aggregate, would not have a Material Adverse
Effect, would not prevent or materially delay consummation of the transactions
contemplated hereby and would not affect the validity of the issuance of the
Common Stock.

                  (b) Except for (i) applicable requirements, if any, under Blue
Sky Laws, (ii) the filing of additional listing applications with the Principal
Market, and (iii) the filing of the Registration Statement, to the Knowledge of
the Company, no filing, consent, approval, permit, authorization, notice,
registration or other action of or with any Governmental Entity is required to
be made or obtained by or with respect to the Company or any of its Subsidiaries
in connection with the execution and delivery of the Transaction Documents, the
issuance of the Common Stock or the consummation by the Company of the
transactions contemplated hereby and thereby.

         5.6 Compliance With Applicable Law. The businesses of the Company are
not being conducted in violation of any law, ordinance, rule, regulation,
judgment, decree or order of any Governmental Entity, except for possible
violations which, individually or in the aggregate, would not have a Material
Adverse Effect. The Company and each of its Subsidiaries possess all domestic
and foreign governmental licenses, permits, authorizations and approvals and
have made all registrations and given all notifications required under federal,
state, local or foreign law to carry on in all respects their businesses as
currently conducted, except as otherwise disclosed in writing by the Company to
the Investor on or prior to the date hereof, and except where the failure to
have any such licenses, permits, authorizations or approvals, individually or in
the aggregate, would not have a Material Adverse Effect. No investigation or
review by any Governmental Entity with respect to the Company or any of its
Subsidiaries is pending or, to the knowledge of the Company, threatened, other
than those the outcome of which, individually or in the aggregate, would not
reasonably be expected to have a Material Adverse Effect.

         5.7 Litigation. Except as set forth in Schedule 5.7, there is no claim,
action or proceeding (including any condemnation proceeding) pending or, to the
Knowledge of the Company, threatened against or relating to the Company or any
of its Subsidiaries by or before any Governmental Entity or arbitrator that if
adversely determined, individually or in the aggregate, would have a Material
Adverse Effect, nor is there any judgment, decree, injunction, rule or order of
any Governmental Entity or arbitrator outstanding against the Company or any of
its Subsidiaries that has had, or would reasonably be expected in the future to
have, a Material Adverse Effect or which reasonably could be expected to
materially adversely affect the transactions contemplated by this Agreement.

                                       17
<PAGE>   22

         5.8 SEC Documents, Financial Statements.

                  (a) The Common Stock will be registered pursuant to Section
12(g) of the Exchange Act and the Company has filed all reports, schedules,
forms, statements and other documents, together with all exhibits, financial
statements and schedules thereto required to be filed by it with the SEC
pursuant to the reporting requirements of the Exchange Act, including material
filed pursuant to Section 13(a) or 15(d) thereof (all of the foregoing, and all
other documents and registration statements, whether heretofore or hereafter
filed by the Company with the SEC since December 31, 1997, and the Registration
Statement, when declared effective, being hereinafter referred to as the "SEC
Documents"). The Common Stock is currently listed or quoted on the Principal
Market, which is, as of the date hereof, the National Association of Securities
Dealers Over the Counter Bulletin Board Quotation System. The Company has
delivered or made available to the Investor true and complete copies of the SEC
Documents through the date of this Agreement. To the Knowledge of the Company,
as of their respective dates, the SEC Documents complied in all material
respects with the requirements of the Exchange Act or the Securities Act, as the
case may be, and the rules and regulations of the SEC promulgated thereunder and
other federal, state and local laws, rules and regulations applicable to such
SEC Documents, and none of the SEC Documents contained any untrue statement of a
material fact or omitted to state a material fact required to be stated herein
or necessary in order to make the statements therein, in light of the
circumstances under which they were made, not misleading. As of the date of
delivery by the Investor of the Prospectus contained in the Registration
Statement in connection with sales of Common Stock by the Investor, such
Prospectus will comply in all material respects with the requirements of the
Securities Act and the rules and regulations of the SEC promulgated thereunder,
and other federal, state and local laws, rules and regulations applicable to
such Prospectus. The financial statements of the Company included (or
incorporated by reference) in the SEC Documents comply as to form in all
material respects with applicable accounting requirements and the published
rules and regulations of the SEC or other applicable rules and regulations with
respect thereto. Such financial statements have been prepared in accordance with
generally accepted accounting principles in the United States of America
("GAAP") applied on a consistent basis during the periods involved (except (i)
as may be otherwise indicated in such financial statements or the notes thereto
or (ii) in the case of unaudited interim statements, to the extent they may not
include footnotes or may be condensed or summary statements) and fairly present
in all material respects the consolidated financial position of the Company and
its Subsidiaries as of the dates thereof and the results of operations and cash
flows for the periods then ended (subject, in the case of unaudited statements,
to normal year-end audit adjustments).

                  (b) To the Knowledge of the Company, during the three (3)
years preceding the date hereof, the SEC has not issued an order preventing or
suspending the use of any prospectus relating to the offering of any shares of
Common Stock or instituted proceedings for that purpose.

         5.9 No Undisclosed or Contingent Liabilities. Neither the Company nor
any of its Subsidiaries has any claims, liabilities or obligations of any nature
whatsoever (whether absolute, accrued, contingent or otherwise and whether due
or to become due) that would be required to be reflected or reserved against on
a consolidated balance sheet of the Company and its

                                       18
<PAGE>   23

consolidated Subsidiaries under GAAP, except for claims, liabilities or
obligations (i) reflected or reserved against on the Balance Sheet, (ii)
disclosed in the Company's most recent Form 10-K or any SEC Document filed
subsequent to such Form 10-K (the "Most Recent SEC Report"), (iii) disclosed on
the schedules attached hereto or (iv) incurred by the Company or any of its
Subsidiaries since the Most Recent SEC Report in the ordinary course of business
and consistent with past practice and that, individually or in the aggregate,
would not have a Material Adverse Effect.

         5.10 Taxes. To the Knowledge of the Company, the Company and its
Subsidiaries have timely filed all necessary Tax Returns and notices and have
paid all federal, state, county, local and foreign taxes of any nature
whatsoever for all the tax years through December 31, 1999 indicated on such Tax
Returns as being due and payable, to the extent such taxes have become due
(other than taxes which are being challenged in good faith by the Company and
have been adequately reserved for by the Company), except where any failure to
file or pay would not have a Material Adverse Effect. To the Knowledge of the
Company, there are no tax deficiencies which would reasonably be expected to
have a Material Adverse Effect; the Company and its Subsidiaries have paid all
Taxes which have become due and payable by the Company (other than Taxes that
are being challenged in good faith or have been adequately reserved for by the
Company), whether pursuant to any assessments, or otherwise, except where any
failure to pay would not have a Material Adverse Effect, and there is no further
liability (whether or not disclosed on such returns) or assessments for any such
Taxes, and no interest or penalties accrues or accruing with respect thereto;
the amounts currently set up as provisions for Taxes or otherwise by the Company
and its Subsidiaries on their books and records are sufficient in all material
respects for the payment of all their unpaid federal, foreign, state, county and
local taxes accrued through the dates as of which they speak, except where such
insufficiency would not have a Material Adverse Effect, and for which the
Company and its Subsidiaries may be liable in their own right, or as transferee
of the assets of, as successor to any other corporation, association,
partnership, joint venture or other entity.

         5.11 Employee Benefit Plans. To the Knowledge of the Company, all
employee benefit plans and other benefit arrangements covering the employees of
the Company and its Subsidiaries (the "Benefit Plans") have been operated and
administered in all material respects in compliance with their terms and
applicable law, and there are no claims, liabilities or obligations of any kind
whatsoever relating to the Benefit Plans which individually or in the aggregate
would have a Material Adverse Effect.

         5.12 Absence of Certain Changes. Except as set forth in Schedule 5.12,
since the Most Recent SEC Report, the business of the Company and its
Subsidiaries has been conducted in the ordinary course consistent with past
practices and there has not been:

                  (a) to the Knowledge of the Company, any event, occurrence,
development or state of circumstances or facts which, individually or in the
aggregate, has had or would reasonably be expected to have a Material Adverse
Effect;

                  (b) any declaration, setting aside or payment of any dividend
or other distribution with respect to any shares of Capital Stock of the Company
or any repurchase,

                                       19
<PAGE>   24

redemption or other acquisition by the Company or any Subsidiary of any
outstanding shares of Capital Stock or other securities of, or other ownership
interests in, the Company or any Subsidiary;

                  (c) any amendment of any material term of any outstanding
security of the Company or any Subsidiary;

                  (d) any incurrence, assumption or guarantee by the Company or
any Subsidiary of any indebtedness for borrowed money, other than (i) working
lines of credit or borrowings under existing lines of credit or floor plan
financing arrangements, (ii) any license fees and royalties and (iii) pursuant
to any lease;

                  (e) any creation or assumption by the Company or any
Subsidiary of any Lien on any material asset other than in the ordinary course
of business consistent with past practices;

                  (f) any making of any loan, advance or capital contributions
to or investment in any Person in excess of $50,000 other than loans, advances
or capital contributions to or investments in wholly-owned Subsidiaries made in
the ordinary course of business consistent with past practice;

                  (g) any damage, destruction or other casualty loss (whether or
not covered by insurance) affecting the business or assets of the Company or any
Subsidiary which, individually or in the aggregate, has had or would reasonably
be expected to have a Material Adverse Effect;

                  (h) any transaction or commitment made, or any contract or
agreement entered into, by the Company or any Subsidiary relating to its assets
or business (including the acquisition or disposition of any assets) or any
relinquishment by the Company or any Subsidiary of any contract or other right,
in any such case, material to the Company and the Subsidiaries, taken as a
whole, other than transactions and commitments in the ordinary course of
business consistent with past practice and those contemplated by this Agreement;
or

                  (i) any material change in any method of accounting or
accounting practice by the Company or any Subsidiary.

         5.13 Environmental Matters.

                  (a) To the Knowledge of the Company, the Company and its
Subsidiaries have obtained all permits, licenses and other authorizations, and
have made all registrations and given all notifications, that are required with
respect to the operation of their respective businesses under all applicable
Environmental Laws other than those permits, licenses, other authorizations,
registrations and notifications the failure of which to obtain or make,
individually or in the aggregate, would not have a Material Adverse Effect.

                  (b) To the Knowledge of the Company, the Company and its
Subsidiaries are in compliance in all material respects with all terms and
conditions of the required permits, licenses and other authorizations referred
to in subsection (a) of this Section 5.13, and also in compliance in all
material respects with any other limitations, restrictions, conditions,
standards,

                                       20
<PAGE>   25

prohibitions, requirements, obligations, schedules and timetables contained in
the Environmental Laws or contained in any regulation, code, plan, order,
decree, judgment, injunction, settlement agreement, notice or demand letter
issued, entered, promulgated or approved thereunder, other than where the
failure to be in such compliance, individually or in the aggregate, would not
have a Material Adverse Effect.

                  (c) There is no civil, criminal or administrative action,
suit, demand, claim, hearing, notice of violation, investigation, proceeding,
notice or demand letter (collectively, "Actions") pending or, to the Knowledge
of the Company, threatened against the Company or any of its Subsidiaries
relating in any way to Environmental Laws or any regulation, code, plan, order,
decree, judgment, injunction, notice or demand letter issued, entered,
promulgated or approved thereunder other than Actions that, if determined
adversely to the Company or such Subsidiaries, would not reasonably be expected
to have a Material Adverse Effect.

         5.14 Material Contracts.

                  (a) To the Knowledge of the Company, except as filed as an
exhibit to or incorporated by reference in the Company's reports filed with the
Securities and Exchange Commission and publicly available on EDGAR, as of the
date hereof, neither the Company nor any Subsidiary is a party to or is bound by
any agreement or arrangement that is required to be filed in accordance with the
terms of Item 601(b)(10) of Regulation S-K under the Securities Act ("Material
Contracts").

                  (b) To the Knowledge of the Company, each Material Contract is
in full force and effect and constitutes a legal, valid and binding obligation
of the Company or the Subsidiary party thereto and each other party thereto, and
is enforceable against the Company or its Subsidiaries and, to the Knowledge of
the Company, each other party thereto in accordance with its terms, except to
the extent that such enforceability is limited by (i) bankruptcy, insolvency,
reorganization, fraudulent transfer, moratorium or other similar laws now or
hereafter in effect relating to creditors' rights generally and (ii) general
principles of equity, and neither the Company nor any of its Subsidiaries, nor,
to the Knowledge of the Company, any other party thereto is in conflict
therewith or in violation or breach thereof or default thereunder, except for
such conflicts, violations, breaches and defaults which, individually or in the
aggregate, would not reasonably be expected to have a Material Adverse Effect.

         5.15 Properties; Encumbrances. Subject to the next succeeding sentence,
each of the Company and its Subsidiaries has good and valid title, and in the
case of real property, insurable title, to all material properties and assets
which it purports to own (real, personal and mixed, tangible and intangible,
including all forms of goodwill, rights, intellectual property and intellectual
property rights) (collectively, the "Company Assets"), including, without
limitation, all the material properties and assets reflected on the Balance
Sheet (except for (i) real and personal property sold since the date of the
Balance Sheet or which was obsolete or no longer useful in connection with the
businesses of the Company and its Subsidiaries and (ii) capital leases reflected
on the Balance Sheet), and all material properties and assets purchased by the
Company and its Subsidiaries since the date of the Balance Sheet. All Company
Assets are free and clear of all liens, mortgages, claims, interests, charges,
security interests or other

                                       21
<PAGE>   26

encumbrances or adverse interests of any nature whatsoever and other title or
interest retention arrangements ("Liens"), except (A) as reflected on the
Balance Sheet, (B) statutory Liens of carriers, warehousemen, mechanics, workmen
and materialmen for liabilities and obligations incurred in the ordinary course
of business consistent with past practice that are not yet delinquent or being
contested in good faith, (C) such defects, irregularities, encumbrances and
other imperfections of title as normally exist with respect to property similar
in character and that, individually or in the aggregate together with all other
such exceptions, do not have a Material Adverse Effect, (D) Liens for Taxes and
(E) Liens that do not interfere with the present use of the property subject to
the Lien.

         5.16 Insurance. All current primary, excess and umbrella policies of
insurance owned or held by or on behalf of or providing insurance coverage to
the Company or any of its Subsidiaries are in full force and effect. With
respect to all such insurance policies purchased by the Company or any of its
Subsidiaries, no premiums are in arrears and no notice of cancellation or
termination has been received with respect to any such policy, other than
notices of cancellation or termination routinely sent at the end of a policy
term. To the Knowledge of the Company, the insurance coverage of the Company and
its Subsidiaries is consistent with the coverage generally maintained by
corporations of similar size and engaged in similar lines of business.

         5.17 Employee Claims; Labor Matters. There are no claims or actions
pending or, to the Knowledge of the Company, threatened between the Company or
any of its Subsidiaries and any of their respective employees, unions, or former
employees that would be reasonably likely to, individually or in the aggregate,
have a Material Adverse Effect. The Company and each of its Subsidiaries have no
collective bargaining agreements covering employees of the Company or any
Subsidiary.

         5.18 Material Disclosure. To the Knowledge of the Company, there is no
fact, transaction or development which the Company has not disclosed to the
Investor in writing (including pursuant to the SEC Documents filed prior to the
date hereof) which would reasonably be expected, individually or in the
aggregate, to have a Material Adverse Effect. To the Knowledge of the Company,
this Agreement (including any Exhibit or Schedule hereto) and any written
statements, documents or certificates furnished to the Investor by the Company
or its Subsidiaries prior to the date hereof in connection with the transactions
contemplated hereby, taken as a whole, do not and will not contain any untrue
statement of a material fact or omit to state a material fact required to be
stated herein or therein or necessary to make the statements herein or therein,
in light of the circumstances under which they were made, not misleading.

         5.19 Intellectual Property. To the Knowledge of the Company, the
Company and its Subsidiaries own or possess adequate patent rights or licenses
or other rights to use patent rights, inventions, trademarks, service marks,
trade names and copyrights material to the general business now operated by them
and neither the Company nor any of its Subsidiaries has received any notice of
infringement or conflict with asserted rights of others with respect to any
patent, patent rights, inventions, trademarks, service marks, trade names or
copyrights which, individually or in the aggregate, would reasonably be expected
to have a Material Adverse Effect.

                                       22
<PAGE>   27

         5.20 No Undisclosed Events or Circumstances. To the Knowledge of the
Company, since the Most Recent SEC Report, no event or circumstance has occurred
or exists with respect to the Company or its Subsidiaries or their respective
businesses, properties, operations, prospects or financial condition, which,
under applicable law, rule or regulation, requires public disclosure or
announcement prior to the date hereof by the Company.

         5.21 Brokers. The Company has taken no action which would give rise to
any claim by any Person for brokerage commissions, finder's fees or similar
payments by the Investor relating to this Agreement for the transactions
contemplated hereby, other than the cash payment fee of three percent (3%) of
each Investment Amount, which fee shall be paid to Greenfield Capital Partners,
LLC.

         5.22 No Violation of Covenants. To the Knowledge of the Company, no
event of default has occurred and is continuing (or event which with the lapse
of time or notice or both would constitute such an event) which has not
otherwise been waived under any revolving credit facility, indenture, mortgage,
deed of trust, loan agreement or other agreement or instrument for money
borrowed or any other material agreement to which the Company or any of its
Subsidiaries is bound, or to which any of the property or assets of the Company
or any of its Subsidiaries is subject, and in any case, which the failure to
cure or obtain a waiver with respect to such default would have a Material
Adverse Effect.

         5.23 No Integrated Offering. Neither the Company, nor any of its
Affiliates, nor any person acting on its or their behalf has, directly or
indirectly, made any offers or sales of any security or solicited any offers to
buy any security, under circumstances that would require registration of any of
the Common Stock under the Securities Act or cause this offering of Common Stock
to be integrated with prior offerings by the Company for purposes of the
Securities Act or any applicable stockholder approval provisions, including,
without limitation, under the rules and regulations of the Principal Market, nor
will the Company or any of its Subsidiaries take any action or steps that would
require registration of the Common Stock under the Securities Act or cause this
offering of Common Stock to be integrated with other offerings.

                                   ARTICLE VI

                            COVENANTS OF THE COMPANY

         6.1 Compliance. The Company shall comply in all respects with the terms
of this Agreement.

         6.2 Reservation of Common Stock. The Company has reserved and will
continue to reserve and keep available at all times during the Commitment Period
a number of shares equal or greater than the result of (i) the difference
between Twenty Five Million Dollars ($25,000,000) and the sum of each Investment
Amount divided by (ii) the Purchase Price on a particular day, rounded up to the
nearest whole integer. Notwithstanding the foregoing, the number of shares so
reserved from time to time shall be adjusted proportionally to reflect stock
splits, dividends, distributions, redenominations, combinations and similar
transactions involving the Company's Common Stock.

                                       23
<PAGE>   28

         6.3 Listing of Common Stock. During the term of this Agreement, the
Company hereby agrees to maintain the listing of the Common Stock on a Principal
Market, and as soon as reasonably practicable but in any event no later than the
Effective Date, to list on a Principal Market the shares of Common Stock
issuable under this Agreement. The Company further agrees that, if the Company
applies to have the Common Stock traded on any other Principal Market, it will
include in such application the Common Stock issuable under this Agreement, and
will take such other action as is necessary or desirable to cause the Common
Stock to be listed on such other Principal Market as promptly as possible.

         6.4 Exchange Act Reporting. During the term of this Agreement, the
Company will comply in all respects with its reporting and filing obligations
under the Exchange Act, and will not take any action or file any document
(whether or not permitted by the Exchange Act or the rules thereunder) to
terminate or suspend its reporting and filing obligations under the Exchange
Act. If required, the Company will take all action to continue the listing and
trading of its Common Stock on a Principal Market and will comply in all
material respects with the Company's reporting, filing and other obligations
under the bylaws or rules of the NASD, if applicable, and/or the Principal
Market.

         6.5 Legends. The Company shall instruct the applicable transfer agent
to remove all legends or stop transfer or other restrictions from the
certificates representing shares of Common Stock to be sold by the Investor
pursuant to the Registration Statement.

         6.6 Corporate Existence. During the term of this Agreement, the Company
will take all steps necessary to preserve and continue the corporate existence
of the Company; provided, however, that nothing herein shall be construed to
limit the ability of the Company to partake in any merger, asset sale or
acquisition transaction involving the Company, subject to the Company complying
with the terms of this Agreement.

         6.7 Additional SEC Documents. During the term of this Agreement, the
Company will notify the Investor as and when all SEC Documents are submitted to
the SEC for filing.

                                   ARTICLE VII

                                   TERMINATION

         7.1 Termination.

                  (a) The Company and the Investor may, by mutual written
consent, at any time, terminate this Agreement and any obligation by the
Investor to purchase any Investment Amount for the remainder of the Commitment
Period.

                  (b) The Investor may terminate this Agreement as a result of
(i) a breach by the Company of any material representation, warranty, covenant
or other obligation in the Transaction Documents or (ii) if the Investor
determines, in its reasonable discretion at any time, that the adoption of, or
change in, or any change in the interpretation or application of, any law,
regulation, rule, guideline or treaty (including, but not limited to, changes of
capital adequacy) makes it illegal or materially impractical for the Investor to
fulfill its commitment pursuant to

                                       24
<PAGE>   29

this Agreement, but in the case of either (i) or (ii) above, the Investor may
terminate this Agreement only after a 60-day period in which the parties
negotiate in good faith, in the case of (i), a reasonable substitute for such
provision or some other reasonably acceptable cure of such breach or, in the
case of (ii), a reasonable alternative manner not illegal or impossible for the
Investor to fulfill its commitment pursuant to this Agreement.

                  (c) The Investor may terminate this Agreement at any time
after the suspension of the availability of the Registration Statement for use
by the Investor, if such suspension is not cured within forty-five (45) days.

                                  ARTICLE VIII

                                 INDEMNIFICATION

         8.1 Indemnification.

                  (a) Indemnification of Investor. The Company agrees to
indemnify and hold harmless the Investor and each person, if any, who controls
the Investor within the meaning of Section 15 of the Securities Act or Section
20 of the Exchange Act as follows:

                           (i) against any and all loss, liability, claim,
                  damage and reasonable expense whatsoever, as incurred, arising
                  out of any untrue statement of a material fact contained in
                  the Registration Statement (or any amendment thereto) or the
                  Prospectus, or the omission or alleged omission therefrom of a
                  material fact required to be stated therein or necessary to
                  make the statement therein not misleading or arising out of
                  any untrue statement or alleged untrue statement of a material
                  fact contained in the Prospectus (or any amendment or
                  supplement thereto) or the omission or alleged omission
                  therefrom of a material fact necessary in order to make the
                  statements therein, in the light of the circumstances under
                  which they were made, not misleading;

                           (ii) against any and all loss, liability, claim,
                  damage and reasonable expense whatsoever, as incurred, to the
                  extent of the aggregate amount paid in settlement of any
                  litigation, or any investigation or proceeding by any
                  governmental agency or body, based upon any such untrue
                  statement or omission, or any such alleged untrue statement or
                  omission; provided that (subject to Section 8.1(d) below) any
                  such settlement is effected with the written consent of the
                  Company; and

                           (iii) against any and all reasonable expenses
                  whatsoever, as incurred (including the fees and disbursements
                  of counsel), reasonably incurred in investigating, preparing
                  or defending against any litigation, or any investigation or
                  proceeding by any governmental agency or body, commenced or
                  threatened in writing, or any claim whatsoever based upon any
                  such untrue statement or omission, or any such alleged untrue
                  statement or omission, to the extent that any such expense is
                  not paid under (i) or (ii) above; provided, however, that no
                  indemnity obligation of the Company shall apply to any loss,
                  liability, claim,

                                       25
<PAGE>   30

                  damage or expense to the extent arising out of any untrue
                  statement or omission or alleged untrue statement or omission
                  made in reliance upon and in conformity with written
                  information furnished to the Company by or on behalf of the
                  Investor expressly for use in the Registration Statement (or
                  any amendment thereto), including the Prospectus (or any
                  amendment or supplement thereto).

                  (b) Indemnification of Company. The Investor agrees to
indemnify and hold harmless the Company, its directors, each of its officers who
signed the Registration Statement, and each person, if any, who controls the
Company within the meaning of Section 15 of the Securities Act or Section 20 of
the Exchange Act against any and all loss, liability, claim, damage and expense
described in the indemnity contained in clause (a) of this Section, as incurred,
but only with respect to untrue statements or omissions, or alleged untrue
statements or omissions, made in the Registration Statement (or any amendment
thereto), including the Prospectus (or any amendment or supplement thereto), in
reliance upon and in conformity with information furnished to the Company by or
on behalf of the Investor expressly for use in the Registration Statement (or
any amendment or supplement thereto) or the Prospectus.

                  (c) Action against Parties; Notification. Each indemnified
party shall give notice as promptly as reasonably practicable to each
indemnifying party of any action commenced against it in respect of which
indemnity may be sought hereunder, but failure to so notify an indemnifying
party shall not relieve such indemnifying party from any liability hereunder, in
any case, to the extent it is not prejudiced as a result thereof and in any
event shall not relieve it from any liability which it may have otherwise than
on account of this indemnity agreement. In case any such action is brought
against any indemnified party, and it notifies an indemnifying party of the
commencement thereof, the indemnifying party will be entitled to participate
therein, and to the extent it may elect by written notice delivered to the
indemnified party reasonably promptly after receiving the aforesaid notice from
such indemnified party, to assume the defense thereof. Notwithstanding the
foregoing, the indemnified party or parties shall have the right to employ its
own counsel in any such case but the reasonable fees and expenses of such
counsel shall be at the expense of such indemnified party or parties unless (i)
the employment of such counsel shall have been authorized in writing by the
indemnifying party in connection with the defense of such action at the expense
of the indemnifying party, (ii) the indemnifying party shall not have employed
counsel to have charge of the defense of such action within a reasonable time
after notice of commencement of the action, or (iii) such indemnified party or
parties shall have reasonably concluded that there are fundamental defenses
available to it or them which are inconsistent with those available to one or
all of the indemnifying parties (in which case the indemnifying parties shall
not have the right to direct the defense of such action on behalf of the
indemnified parties), in any of which events such reasonable fees and expenses
of one additional counsel shall be borne by the indemnifying party. In no event
shall the indemnifying party be liable for fees and expenses of more than one
counsel (in addition to one local counsel) separate from its own counsel for the
indemnified parties in connection with any one action or separate but similar or
related actions in the same jurisdiction arising out of the same general
allegations or circumstances. No indemnifying party shall, without the prior
written consent of the indemnified parties, settle or compromise or consent to
the entry or any judgment with respect to any litigation, or any investigation
or proceeding by any governmental agency or body, commenced or threatened, or
any claim whatsoever in respect of which indemnification or

                                       26
<PAGE>   31

contribution could be sought under this Section 8.1 or Section 8.2 hereof
(whether or not the indemnified parties are actual or potential parties
thereto), unless such settlement, compromise or consent (i) includes an
unconditional release of each such nonconsenting indemnified party from all
liability arising out of such litigation, investigation, proceeding or claim and
(ii) does not include a statement as to or an admission of fault, culpability or
a failure to act by or on behalf of an any such nonconsenting indemnified party.

                  (d) Settlement without Consent if Failure to Reimburse. If at
any time an indemnified party shall have requested an indemnifying party to
reimburse the indemnified party for the fees and expenses of counsel, such
indemnifying party agrees that it shall be liable for any settlement of the
nature contemplated by Section 8.1(a)(ii) effected without its written consent
if (i) such settlement is entered into more than forty-five (45) days after
receipt by such indemnifying party of the aforesaid request, (ii) such
indemnifying party shall have received notice of the terms of such settlement at
least thirty (30) days prior to such settlement being entered into and (iii)
such indemnifying party shall not have reimbursed such indemnified party in
accordance with such request prior to the date of such settlement.

         8.2 Contribution.

                  (a) If the indemnification provided for in Section 8.1 hereof
is for any reason unavailable to or insufficient to hold harmless an indemnified
party in respect of any losses, liabilities, claims, damages or expenses to the
extent provided for herein, then each indemnifying party shall contribute to the
aggregate amount of such losses, liabilities, claims, damages and expenses
incurred by such indemnified party, as incurred (i) in such proportion as is
appropriate to reflect the relative benefits received by the Company on the one
hand and the Investor on the other hand from the offering of the Common Stock
pursuant to this Agreement (which proportionate benefits are hereby deemed to be
92% for the Company and 8% for the Investor) or (ii) if the allocation provided
by clause (i) is not permitted by applicable law, in such proportion as is
appropriate to reflect not only the relative benefits referred to in clause (i)
above but also the relative fault of the Company on the one hand and of the
Investor on the other hand and in connection with the statements or omissions
which resulted in such losses, liabilities, claims, damages or expenses, as well
as any other relevant equitable considerations.

                  (b) The relative benefits received by the Company on the one
hand and the Investor on the other hand in connection with the offering of the
Common Stock pursuant to this Agreement shall be deemed to be in the same
respective portions as the total proceeds from the offering of the Common Stock
pursuant to this Agreement received by the Company from the Investor, on the one
hand, and the total profits received by the Investor upon the sale of such
Common Stock issuable hereunder, on the other hand bear to the aggregate public
offering price of the Common Stock.

                  (c) The relative fault of the Company on the one hand and the
Investor on the other hand shall be determined by reference to, among other
things, whether any such untrue or alleged untrue statement of a material fact
or omission or alleged omission to state a material fact relates to information
supplied by the Company or by the Investor and the party's relative intent,

                                       27
<PAGE>   32

knowledge, access to information and opportunity to correct or prevent such
statement or omission.

                  (d) The Company and the Investor agree that it would not be
just and equitable if contribution pursuant to this Section 8.2 were determined
on a pro-rata allocation or by any other method of allocation which does not
take account of the equitable considerations referred to above in this Section
8.2. The aggregate amount of losses, liabilities, claims, damages and expenses
incurred by an indemnified party and referred to above in this Section 8.2 shall
be deemed to include any reasonable legal or other expenses reasonably incurred
by such indemnified party in investigating, preparing or defending against any
litigation, or any investigation or proceeding by any governmental agency or
body, commenced or threatened, or any claim whatsoever based upon any such
untrue or alleged untrue statement or omission or alleged omission.

                  (e) Notwithstanding the provisions of this Section 8.2, the
Investor shall not be required to contribute any amount in excess of the amount
by which the total price at which the Common Stock purchased by it and resold to
the public exceeds the amount of any damages which the Investor has otherwise
been required to pay by reason of any such untrue or alleged untrue statement or
omission or alleged omission.

                  (f) No person guilty of fraudulent misrepresentation (within
the meaning of Section 11(f) of the Securities Act) shall be entitled to
contribution from any person who was not guilty of such fraudulent
misrepresentation.

                  (g) For purposes of this Section 8.2, each person, if any, who
controls the Investor within the meaning of Section 15 of the Securities Act or
Section 20 of the Exchange Act shall have the same rights to contribution as
such Investor, and each director of the Company, each officer of the Company who
signed the Registration Statement, and each person, if any, who controls the
Company within the meaning of Section 15 of the Securities Act or Section 20 of
the Exchange Act shall have the same rights to contribution as the Company.

                                   ARTICLE IX

                                  MISCELLANEOUS

         9.1 Costs and Expenses. The Company shall be responsible for the
Investor's reasonable out-of-pocket costs and expenses, including fees and
expenses of its legal counsel, in connection with the preparation and
negotiation of the Transaction Documents and the materials required for Closings
under this Agreement. The Company agrees to pay the Investor the amounts due
under this clause no later than the Agreement Date.

         9.2 Notices. Any notice, request, instruction, correspondence or other
document to be given hereunder by either party to the other (herein collectively
called "Notice") shall be in writing and delivered in person or by courier
service requiring acknowledgment of receipt of delivery or mailed by certified
mail, postage prepaid and return receipt requested, or by telecopier, as
follows:

                                       28
<PAGE>   33

                  If to the Company, to:

         Corzon, Inc.
         Attention: Chief Executive Officer and General Counsel
         1087 Broad Street, 4th Floor
         Bridgeport, Connecticut 06604
         Telecopy: 203-335-1455
         Telephone: 203-333-6389

                  With a copy (which shall not constitute notice) to:

         Mayer, Brown & Platt
         Attention: John M. Mann
         700 Louisiana St., Suite 3600
         Houston, Texas 77002-2730
         Telecopy: 713-224-6410
         Telephone: 713-547-9619

                  If to the Investor, to:

         Pima Capital Management, Limited
         Attention: Barry Herman
         c/o Lion Corporate Services, Limited
         Cumberland House, #27 Cumberland Street
         P.O. Box N-10818, Nassau, Island of New Providence, Bahamas
         Telecopy: 242-356-0037
         Telephone: 242-356-2486

         Notice given by personal delivery, courier service or mail shall be
effective upon actual receipt. Notice given by telecopier shall be confirmed by
appropriate answer back and shall be effective upon actual receipt if received
during the recipient's normal business hours, or at the beginning of the
recipient's next business day after receipt if not received during the
recipient's normal business hours. All Notices by telecopier shall be confirmed
promptly after transmission in writing by certified mail or personal delivery.
Any party may change any address to which Notice is to be given to it by giving
Notice as provided above of such change of address.

         9.3 Governing Law, Jurisdiction and Venue. This Agreement shall be
governed by, and construed in accordance with, the laws of the state of New
York. The courts of the state of New York shall have jurisdiction and venue for
the adjudication of any civil action between the Company and the Investor, or
their respective successors in interest, arising out of, or relating to, this
Agreement. The Company and the Investor, for itself and its respective
successors in interest, hereby irrevocably consent to such jurisdiction and
venue, and hereby irrevocably waive any claim of forum non conveniens or right
to change such venue.

         9.4 Entire Agreement; Amendments and Waivers. This Agreement
constitutes the entire agreement between the parties hereto pertaining to the
subject matter hereof and supersedes all prior agreements, understandings,
negotiations and discussions, whether oral or

                                       29
<PAGE>   34

written, of the parties, and there are no warranties, representations or other
agreements between the parties in connection with the subject matter hereof
except as set forth specifically herein or contemplated hereby. No supplement,
modification or waiver of this Agreement shall be binding unless executed in
writing by the party to be bound thereby. The failure of a party to exercise any
right or remedy shall not be deemed or constitute a waiver of such right or
remedy in the future. No waiver of any of the provisions of this Agreement shall
be deemed or shall constitute a waiver of any other provision hereof (regardless
of whether similar), nor shall any such waiver constitute a continuing waiver
unless otherwise expressly provided.

         9.5 Binding Effect and Assignment. This Agreement shall be binding upon
and inure to the benefit of the parties hereto and their respective permitted
successors and assigns; but neither this Agreement nor any of the rights,
benefits or obligations hereunder shall be assigned, by operation of law or
otherwise, by any party hereto without the prior written consent of the other
party; provided, however, that Investor may assign its rights and obligations
hereunder, in whole or in part, without the Company's consent, (i) to any of its
Affiliates or (ii) to any accredited investors (as defined in SEC Rule 501(a))
in a transaction exempt from the registration requirements of the Securities Act
(a "Permitted Transferee"); provided, however, that any such assignment shall
not release the Investor from its obligations hereunder. The rights and
obligations of the Investor under this Agreement shall inure to the benefit of,
and be enforceable by and against, any such Permitted Transferee. Nothing in
this Agreement, express or implied, is intended to confer upon any person or
entity other than the parties hereto and their respective permitted successors
and assigns, any rights, benefits or obligations hereunder.

         9.6 Waiver of Immunity. The Company irrevocably waives, to the fullest
extent permitted by law, all immunity (whether on the basis of sovereignty or
otherwise) from jurisdiction, attachment (both before and after judgment) and
execution to which it might otherwise be entitled in any action or proceeding in
any court relating in any way to this Agreement and agrees that it will not
raise or claim or cause to be pleaded any such immunity at or in respect of such
action or proceeding.

         9.7 Headings. The headings of the sections herein are inserted for
convenience of reference only and are not intended to be a part of or to affect
the meaning or interpretation of this Agreement.

         9.8 Execution. This Agreement may be executed in multiple counterparts
each of which shall be deemed an original and all of which shall constitute one
instrument.

         9.9 Survival; Severability. The representations, warranties, covenants
and agreements of the parties hereto shall survive each Closing hereunder. The
indemnity and contribution agreements contained herein shall survive and remain
operative and in full force and effect regardless of (i) any termination of this
Agreement or of the Commitment Period, (ii) any investigation made by or on
behalf of any indemnified party or by or on behalf of the Company, and (iii) the
consummation of the sale or successive resales of the Common Stock. In the event
that any provision of this Agreement becomes or is declared by a court of
competent jurisdiction to be illegal, unenforceable or void, this Agreement
shall continue in full force and effect without said provision; provided that
such severability shall be ineffective if it materially changes the economic
benefit of this Agreement to any party.

                                    * * * * *

                                       30
<PAGE>   35

         IN WITNESS WHEREOF, the parties hereto have caused this Equity Line
Financing Agreement to be duly executed by their respective authorized officers
as of the date hereof.

                                       CORZON, INC.

                                       By: /s/ Lawrence Shatsoff
                                       Name: Lawrence Shatsoff
                                       Title: President

                                       PIMA CAPITAL MANAGEMENT, LIMITED

                                       By: /s/ Barry W. Herman
                                       Name: Barry W. Herman
                                       Title: President

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