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                                                                   EXHIBIT 10.15
                              EMPLOYMENT AGREEMENT

                  AGREEMENT by and between Beazer Homes USA, Inc., a Delaware
corporation (the "Company") and C. Lowell Ball (the "Executive"), dated as of
the 7th day of November, 2000.

                  The Board of Directors of the Company (the "Board"), has
determined that it is in the best interests of the Company and its shareholders
to assure that the Company will have the continued dedication of the Executive,
notwithstanding the possibility, threat or occurrence of a Change of Control (as
defined below) of the Company. The Board believes it is imperative to diminish
the inevitable distraction of the Executive by virtue of the personal
uncertainties and risks created by a pending or threatened Change of Control and
to encourage the Executive's full attention and dedication to the Company
currently and in the event of any threatened or pending Change of Control, and
to provide the Executive with compensation and benefits arrangements upon a
Change of Control which ensure that the compensation and benefits expectations
of the Executive will be satisfied and which are competitive with those of other
corporations. Therefore, in order to accomplish these objectives, the Board has
caused the Company to enter into this Agreement.

                  NOW, THEREFORE, IT IS HEREBY AGREED AS FOLLOWS:

          1. CERTAIN DEFINITIONS. (a) The "Effective Date" shall mean the
first date during the Change of Control Period (as defined in Section 1(b))
on which a Change of Control (as defined in Section 2) occurs. Anything in
this Agreement to the contrary notwithstanding, if a Change of Control occurs
and if the Executive's employment with the Company is terminated prior to the
date on which the Change of Control occurs, and if it is reasonably
demonstrated by the Executive that such termination of employment (i) was at
the request of a third party who has taken steps reasonably calculated to
effect a Change of Control or (ii) otherwise arose in connection with or
anticipation of a Change of Control, then for all purposes of this Agreement
the "Effective Date" shall mean the date immediately prior to the date of
such termination of employment.

                  (b) The "Change of Control Period" shall mean the period
commencing on the date hereof and ending on September 30, 2002; provided,
however, that commencing on September 30, 2001, and on each annual anniversary
of such date (such date and each annual anniversary thereof shall be hereinafter
referred to as the "Renewal Date"), unless previously terminated, the Change of
Control Period shall be automatically extended so as to terminate two years from
such Renewal Date, unless at least 60 days prior to the Renewal Date the Company
shall give notice to the Executive that the Change of Control Period shall not
be so extended.

          2. CHANGE OF CONTROL. For the purpose hereof, a "Change of Control"
shall mean:

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                  (a) The acquisition by any individual, entity or group (within
the meaning of Section 13(d)(3) or 14(d)(2) of the Securities Exchange Act of
1934, as amended (the "Exchange Act")) (a "Person") of beneficial ownership
(within the meaning of Rule 13d-3 promulgated under the Exchange Act) of 20% or
more of either (x) the then outstanding shares of common stock of the Company
(the "Outstanding Company Common Stock") or (y) the combined voting power of the
then outstanding voting securities of the Company entitled to vote generally in
the election of directors (the "Outstanding Company Voting Securities");
provided, however, that for purposes of this subsection (a), the following
acquisitions shall not constitute a Change of Control: (A) any acquisition
directly from the Company, (B) any acquisition by the Company, (C) any
acquisition by any employee benefit plan (or related trust) sponsored or
maintained by the Company or any corporation controlled by the Company or (D)
any acquisition by any corporation pursuant to a transaction which complies with
clauses (i), (ii), and (iii) of subsection (c) of this Section 2; or

                  (b) Individuals who, as of the date hereof, constitute the
Board (the "Incumbent Board") cease for any reason to constitute at least a
majority of the Board; provided, however, that any individual becoming a
director subsequent to the date hereof whose election, or nomination for
election by the Company's shareholders, was approved by a vote of at least a
majority of the directors then comprising the Incumbent Board shall be
considered as though such individual were a member of the Incumbent Board, but
excluding, for this purpose, any such individual whose initial assumption of
office occurs as a result of an actual or threatened election contest with
respect to the election or removal of directors or other actual or threatened
solicitation of proxies or consents by or on behalf of a Person other than the
Board; or

                  (c) Consummation of a reorganization, merger or consolidation
or sale or other disposition of all or substantially all of the assets of the
Company (a "Business Combination"), in each case, unless, following such
Business Combination, (i) all or substantially all of the individuals and
entities who were the beneficial owners, respectively, of the Outstanding
Company Common Stock and Outstanding Company Voting Securities immediately prior
to such Business Combination beneficially own, directly or indirectly, more than
50% of, respectively, the then outstanding shares of common stock and the
combined voting power of the then outstanding voting securities entitled to vote
generally in the election of directors, as the case may be, of the corporation
resulting from such Business Combination (including, without limitation, a
corporation which as a result of such transaction owns the Company or all or
substantially all of the Company's assets either directly or through one or more
subsidiaries) in substantially the same proportions as their ownership,
immediately prior to such Business Combination of the Outstanding Company Common
Stock and Outstanding Company Voting Securities, as the case may be, (ii) no
Person (excluding any corporation resulting from such Business Combination or
any employee benefit plan (or related trust) of the Company or such corporation
resulting from such Business Combination) beneficially owns, directly or
indirectly, 20% or more of, respectively, the then outstanding shares of common
stock of the corporation resulting from such Business

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Combination or the combined voting power of the then outstanding voting
securities of such corporation except to the extent that such ownership
existed prior to the Business Combination and (iii) at least a majority of
the members of the board of directors of the corporation resulting from such
Business Combination were members of the Incumbent Board at the time of the
execution of the initial agreement, or of the action of the Board, providing
for such Business Combination; or

                  (d) Approval by the shareholders of the Company of a
complete liquidation or dissolution of the Company.

          3. EMPLOYMENT PERIOD. The Company hereby agrees to continue the
Executive in its employ, and the Executive hereby agrees to remain in the
employ of the Company subject to the terms and conditions of this Agreement,
for the period commencing on the Effective Date and ending on the second
anniversary of such date (the "Change of Control Employment Period").

          4. TERMS OF EMPLOYMENT.

                    (a) POSITION AND DUTIES. (i) During the Change of Control
Employment Period, (A) the Executive's position (including status, offices,
titles and reporting requirements), authority, duties and responsibilities
shall be at least commensurate in all material respects with the most
significant of those held, exercised and assigned at any time during the
120-day period immediately preceding the Effective Date; and (B) the
Executive's services shall be performed at the location where the Executive
was employed immediately preceding the Effective Date or any office or
location less than 35 miles from such location.

                    (ii) During the Change of Control Employment Period, and
excluding any periods of vacation and sick leave to which the Executive is
entitled, the Executive agrees to devote reasonable attention and time during
normal business hours to the business and affairs of the Company and, to the
extent necessary to discharge the responsibilities assigned to the Executive
hereunder, to use the Executive's reasonable best efforts to perform faithfully
and efficiently such responsibilities. During the Change of Control Employment
Period it shall not be a violation of this Agreement for the Executive to (A)
serve on corporate, civic or charitable boards or committees, (B) deliver
lectures, fulfill speaking engagements or teach at educational institutions and
(C) manage personal investments, so long as such activities do not significantly
interfere with the performance of the Executive's responsibilities as an
employee of the Company in accordance with this Agreement. It is expressly
understood and agreed that to the extent that any such activities have been
conducted by the Executive prior to the Effective Date, the continued conduct of
such activities (or the conduct of activities similar in nature and scope
thereto) subsequent to the Effective Date shall not thereafter be deemed to
interfere with the performance of the Executive's responsibilities to the
Company.

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                  (b) COMPENSATION.

                  (i) BASE SALARY. During the Change of Control Employment
Period, the Executive shall receive an annual base salary ("Change of Control
Base Salary"), which shall be paid at a monthly rate, at least equal to twelve
times the highest monthly base salary paid or payable, including any base salary
which has been earned but deferred, to the Executive by the Company and its
affiliated companies in respect of the twelve-month period immediately preceding
the month in which the Effective Date occurs. During the Change of Control
Employment Period, the Change of Control Base Salary shall be reviewed no more
than 12 months after the last salary increase awarded to the Executive prior to
the Effective Date and thereafter at least annually. Any increase in Change of
Control Base Salary shall not serve to limit or reduce any other obligation to
the Executive under this Agreement. Change of Control Base Salary shall not be
reduced after any such increase and the term Change of Control Base Salary as
utilized in this Agreement shall refer to Change of Control Base Salary as so
increased. As used in this Agreement, the term "affiliated companies" shall
include any company controlled by, controlling or under common control with the
Company.

                  (ii) ANNUAL BONUS. In addition to Change of Control Base
Salary, the Executive shall be awarded, for each fiscal year ending during the
Change of Control Employment Period, an annual bonus (the "Change of Control
Bonus") in cash at least equal to the Executive's highest annual bonus under the
Company's incentive plans (including, without limitation, the Company's Value
Created Incentive Plan (the "VCIP")), for the last three full fiscal years prior
to the Effective Date (annualized in the event that the Executive was not
employed by the Company for the whole of any such fiscal year) (the "Recent
Annual Bonus"); provided, however, that if (A) the Executive did not receive an
annual bonus during the last full fiscal year immediately preceding the
Effective Date because the Executive was not employed by the Company for the
whole of such year or (B) the Executive was not employed by the Company during
any part of the last full fiscal year immediately preceding the Effective Date,
the Change of Control Bonus shall at least equal the amount the Executive was to
receive under the VCIP based on the Company's budget (as such budget was
approved by the Board), the calculation of which was included as an attachment
to the Executive's employment letter at the time the Executive commenced
employment with the Company. Each such Change of Control Bonus shall be paid no
later than the end of the third month of the fiscal year next following the
fiscal year for which the Change of Control Bonus is awarded, unless the
Executive shall elect to defer the receipt of such Change of Control Bonus.

                  (iii) INCENTIVE, SAVINGS AND RETIREMENT PLANS. During the
Change of Control Employment Period, the Executive shall be entitled to
participate in all incentive, savings and retirement plans, practices, policies
and programs applicable generally to other key executives of the Company and its
affiliated companies, but in no event shall such plans, practices, policies and
programs provide the Executive with incentive opportunities (measured with
respect to both regular and special incentive opportunities, to the extent, if
any, that such distinction is applicable), savings opportunities and

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retirement benefit opportunities, in each case, less favorable, in the
aggregate, than the most favorable of those provided by the Company and its
affiliated companies for the Executive under such plans, practices, policies
and programs as in effect at any time during the 120-day period immediately
preceding the Effective Date or if more favorable to the Executive, those
provided generally at any time after the Effective Date to other key
executives of the Company and its affiliated companies.

                  (iv) WELFARE BENEFIT PLANS. During the Change of Control
Employment Period, the Executive and/or the Executive's family, as the case may
be, shall be eligible for participation in and shall receive all benefits under
welfare benefit plans, practices, policies and programs provided by the Company
and its affiliated companies (including, without limitation, pension, 401(k),
medical, prescription, dental, disability, employee life, group life, accidental
death and travel accident insurance plans and programs) to the extent applicable
generally to other key executives of the Company and its affiliated companies,
but in no event shall such plans, practices, policies and programs provide the
Executive with benefits which are less favorable in the aggregate, than the most
favorable of such plans, practices, policies and programs in effect for the
Executive at any time during the 120-day period immediately preceding the
Effective Date or, if more favorable to the Executive, those provided generally
at any time after the Effective Date to other key executives of the Company and
its affiliated companies.

                  (v) EXPENSES. During the Change of Control Employment Period,
the Executive shall be entitled to receive prompt reimbursement for all
reasonable expenses incurred by the Executive in accordance with the most
favorable policies, practices and procedures of the Company and its affiliated
companies in effect for the Executive at any time during the 120-day period
immediately preceding the Effective Date or, if more favorable to the Executive,
as in effect generally at any time thereafter with respect to other key
executives of the Company and its affiliated companies.

                  (vi) FRINGE BENEFITS. During the Change of Control Employment
Period, the Executive shall be entitled to fringe benefits, including, without
limitation, tax and financial planning services, payment of club dues, and, if
applicable, use of an automobile and payment of related expenses, in accordance
with the most favorable plans, practices, programs and policies of the Company
and its affiliated companies in effect for the Executive at any time during the
120-day period immediately preceding the Effective Date or, if more favorable to
the Executive, as in effect generally at any time thereafter with respect to
other key executives of the Company and its affiliated companies.

                  (vii) OFFICE AND SUPPORT STAFF. During the Change of Control
Employment Period, the Executive shall be entitled to an office or offices of a
size and with furnishings and other appointments, and to exclusive personal
secretarial and other assistance, at least equal to the most favorable of the
foregoing provided to the Executive by the Company and its affiliated companies
at any time during the 120-day period immediately preceding the Effective Date
or, if more favorable to the Executive, as

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provided generally at any time thereafter with respect to other key executives
of the Company and its affiliated companies.

                  (viii) VACATION. During the Change of Control Employment
Period, the Executive shall be entitled to paid vacation in accordance with the
most favorable plans, policies, programs and practices provided to the Executive
by the Company and its affiliated companies at any time during the 120-day
period immediately preceding the Effective Date or, if more favorable to the
Executive, as provided generally at any time thereafter with respect to other
key executives of the Company and its affiliated companies, but in no event
shall Executive receive less than twenty working days of compensated vacation
time in each fiscal year.

          5. TERMINATION OF EMPLOYMENT.

                  (a) DEATH OR DISABILITY. The Executive's employment shall
terminate automatically upon the Executive's death during the Change of
Control Employment Period. If the Company determines in good faith that the
Disability of the Executive has occurred during the Change of Control
Employment Period (pursuant to the definition of Disability set forth below),
it may give to the Executive written notice in accordance with Section 12(b)
of this Agreement of its intention to terminate the Executive's employment.
In such event, the Executive's employment with the Company shall terminate
effective on the 30th day after receipt of such notice by the Executive (the
"Disability Effective Date"), provided that, within the 30 days after such
receipt, the Executive shall not have returned to full-time performance of
the Executive's duties. For purposes of the Agreement, "Disability" shall
mean the absence of the Executive from the Executive's duties with the
Company on a full-time basis for 180 consecutive business days as a result of
incapacity due to mental or physical illness which is determined to be total
and permanent by a physician selected by the Company or its insurers and
acceptable to the Executive or the Executive's legal representative.

                  (b) CAUSE. The Company may terminate the Executive's
employment during the Change of Control Employment Period for Cause. For
purposes of this Agreement, "Cause" shall mean

                  (i) the willful and continued failure of the Executive to
perform substantially the Executive's duties with the Company or one of its
affiliates (other than any such failure resulting from incapacity due to
physical or mental illness), after a written demand for substantial performance
is delivered to the Executive by the Board or the Chief Executive Officer of the
Company which specifically identifies the manner in which the Board or Chief
Executive Officer believes that the Executive has not substantially performed
the Executive's duties, or

                  (ii) the willful engaging by the Executive in illegal conduct
or gross misconduct which is materially and demonstrably injurious to the
Company.

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                  For purposes of this provision, no act or failure to act, on
the part of the Executive, shall be considered "willful" unless it is done, or
omitted to be done, by the Executive in bad faith or without reasonable belief
that the Executive's action or omission was in the best interest of the Company.
Any act, or failure to act, based upon authority given pursuant to a resolution
duly adopted by the Board or upon the instructions of the Chief Executive
Officer or a senior officer of the Company or based upon the advice of counsel
for the Company shall be conclusively presumed to be done, or omitted to be
done, by the Executive in good faith and in the best interests of the Company.
The cessation of employment of the Executive shall not be deemed to be for Cause
unless and until there shall have been delivered to the Executive a copy of a
resolution duly adopted by the affirmative vote of not less that three-quarters
of the entire membership of the Board at a meeting of the Board called and held
for such purpose (after reasonable notice is provided to the Executive and the
Executive is given an opportunity, together with counsel, to be heard before the
Board), finding that, in the good faith opinion of the Board, the Executive is
guilty of the conduct described in subparagraph (i) or (ii) above, and specify
the particulars thereof in detail.

                  (c) GOOD REASON. The Executive's employment may be
terminated by the Executive for Good Reason. For purposes of this Agreement,
"Good Reason" shall mean:

                  (i) the assignment to the Executive of any duties inconsistent
in any respect with the Executive's position (including status, offices, titles
and reporting requirements), authority, duties or responsibilities as
contemplated by Section 4(a) of this Agreement, or any other action by the
Company which results in a diminution in such position, authority, duties or
responsibilities, excluding for this purpose an isolated, insubstantial and
inadvertent action not taken in bad faith and which is remedied by the Company
promptly after receipt of notice thereof given by the Executive;

                  (ii) any failure by the Company to comply with any of the
provisions of Section 4(b) of this Agreement, other than an isolated,
insubstantial and inadvertent failure not occurring in bad faith and which is
remedied by the Company promptly after receipt of notice thereof given by the
Executive;

                  (iii) the Company's requiring the Executive to be based at any
office or location other than as provided in Section 4(a)(i)(B) hereof or the
Company's requiring the Executive to travel on Company business to a
substantially greater extent than required immediately prior to the Effective
Date;

                  (iv) any purported termination by the Company of the
Executive's employment otherwise than as expressly permitted by this Agreement;
or

                  (v) any failure by the Company to comply with and satisfy
Section 11(c) of this Agreement.

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                  For purposes of this Section 5(c), any good faith
determination of "Good Reason" made by the Executive shall be conclusive.
Anything in this Agreement to the contrary notwithstanding, a termination by the
Executive for any reason during the 30-day period immediately following the
first anniversary of the Effective Date shall be deemed to be a termination for
Good Reason for all purposes of this Agreement.

                  (d) NOTICE OF TERMINATION. Any termination by the Company
for Cause, or by the Executive for Good Reason, shall be communicated by
Notice of Termination to the other party hereto given in accordance with
Section 12(b) of the Agreement. For purposes of this Agreement, a "Notice of
Termination" means a written notice which (i) indicates the specific
termination provision in this Agreement relied upon, (ii) to the extent
applicable, sets forth in reasonable detail the facts and circumstances
claimed to provide a basis for termination of the Executive's employment
under the provision so indicated and (iii) if the Date of Termination (as
defined below) is other than the date of receipt of such notice, specifies
the termination date (which date shall be not more than thirty days after the
giving of such notice). The failure by the Executive or the Company to set
forth in the Notice of Termination any fact or circumstance which contributes
to a showing of Good Reason or Cause shall not waive any right of the
Executive or the Company, respectively, hereunder or preclude the Executive
or the Company, respectively, from asserting such fact or circumstance in
enforcing the Executive's or the Company's rights hereunder.

                  (e) DATE OF TERMINATION. "Date of Termination" means (i) if
the Executive's employment is terminated by the Company for Cause, or by the
Executive for Good Reason, the date of receipt of the Notice of Termination
or any later date specified therein, as the case may be, (ii) if the
Executive's employment is terminated by the Company other than for Cause or
Disability, the Date of Termination shall be the date on which the Company
notifies the executive of such termination and (iii) if the Executive's
employment is terminated by reason of death or Disability, the date of
Termination shall be the date of death of the Executive or the Disability
Effective Date, as the case may be.

          6. OBLIGATIONS OF THE COMPANY UPON TERMINATION.

                  (a) GOOD REASON; OTHER THAN FOR CAUSE, DEATH OR DISABILITY.
If, during the Change of Control Employment Period, the Company shall
terminate the Executive's employment other than for Cause, death or
Disability or the Executive shall terminate employment for Good Reason:

                  (i) the Company shall pay to the Executive in a lump sum in
cash within 30 days after the Date of Termination the aggregate of the following
amounts:

                  (A) the sum of (1) the Executive's Change of Control Base
          Salary through the Date of Termination to the extent not theretofore
          paid, (2) the product of (x) the higher of (I) the Recent Annual Bonus
          and (II) the Change of Control Bonus paid or payable, including any
          bonus or portion thereof which has been

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          earned but deferred (and annualized for any fiscal year consisting of
          less than twelve full months or during which the Executive was
          employed for less than twelve full months), for the most recently
          completed fiscal year during the Change of Control Employment Period,
          if any (such higher amount being referred to as the "Highest Annual
          Bonus") and (y) a fraction, the numerator of which is the number of
          days in the current fiscal year through the Date of Termination, and
          the denominator of which is 365 and (3) any compensation previously
          deferred by the Executive (together with any accrued interest or
          earnings thereon) and any accrued vacation pay, in each case to the
          extent not theretofore paid (the sum of the amounts described in
          clauses (1), (2), and (3) shall be hereinafter referred to as the
          "Accrued Obligations"); and

                  (B) an amount equal to the product of (1) 1.5, and (2) the sum
          of (x) the Executive's Change of Control Base Salary and (y) the
          Highest Annual Bonus; and

                  (C) an amount equal to the excess of (a) the actuarial
          equivalent of the benefit under the Company's qualified defined
          benefit retirement plan (the "Retirement Plan") (utilizing actuarial
          assumptions no less favorable to the Executive than those in effect
          under the Company's Retirement Plan immediately prior to the Effective
          Date), and any excess or supplemental retirement plan in which the
          Executive participates (together, the "SERP") which the Executive
          would receive if the Executive's employment continued for 1.5 years
          after the Date of Termination assuming for this purpose that all
          accrued benefits are fully vested, and, assuming that the Executive's
          compensation in each of the three years is that required by Section
          4(b)(i) and Section 4(b)(ii), over (b) the actuarial equivalent of the
          Executive's actual benefit (paid or payable), if any, under the
          Retirement Plan and the SERP as of the Date of Termination;

                  (ii) for 1.5 years after the Executive's Date of Termination,
or such longer period as may be provided by the terms of the appropriate plan,
program, practice or policy, the Company shall continue benefits to the
Executive and/or the Executive's family at least equal to those which would have
been provided to them in accordance with the plans, programs, practices and
policies described in Section 4(b)(iv) of this Agreement if the Executive's
employment had not been terminated or, if more favorable to the Executive, as in
effect generally at any time thereafter with respect to other key executives of
the Company and its affiliated companies and their families, provided, however,
that if the Executive becomes reemployed with another employer and is eligible
to receive medical or other welfare benefits under another employer-provided
plan, the medical and other welfare benefits described herein shall be secondary
to those provided under such other plan during such applicable period of
eligibility. For purposes of determining eligibility (but not the time of
commencement of benefits) of the Executive for retiree benefits pursuant to such
plans, practices, programs and policies, the Executive shall be considered to
have remained employed until 1.5 years after the Date of Termination and to have
retired on the last day of such period;

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                  (iii) the Company shall, at its sole expense as incurred,
provide the Executive with outplacement services the scope and provider of which
shall be selected by the Executive in his sole discretion; and

                  (iv) to the extent not theretofore paid or provided, the
Company shall timely pay or provide to the Executive any other amounts or
benefits required to be paid or provided or which the Executive is eligible to
receive under any plan, program, policy or practice or contract or agreement of
the Company and its affiliated companies and any reimbursement amounts required
to be paid to Executive by the Company and its affiliated companies (such other
amounts and benefits shall be hereinafter referred to as the "Other Benefits").

                  (b) DEATH. If the Executive's employment is terminated by
reason of the Executive's death during the Change of Control Employment
Period, this Agreement shall terminate without further obligations to the
Executive's legal representatives under this Agreement, other than for
payment of Accrued Obligations and the timely payment or provision of Other
Benefits. Accrued Obligations shall be paid to the Executive's estate or
beneficiary, as applicable, in a lump sum in cash within 30 days of the Date
of Termination. With respect to the provision of Other Benefits, the term
Other Benefits as utilized in this Section 6(b) shall include, without
limitation, and the Executive's estate and/or beneficiaries shall be entitled
to receive, benefits at least equal to the most favorable benefits provided
by the Company and affiliated companies to the estates and beneficiaries of
key executives of the Company and affiliated companies under such plans,
programs, practices and policies relating to death benefits, if any, as in
effect with respect to other key executives and their beneficiaries at any
time during the 120-day period immediately preceding the Effective Date or,
if more favorable to the Executive's estate and/or the Executive's
beneficiaries, as in effect on the date of the Executive's death with respect
to other key executives of the Company and its affiliated companies and their
beneficiaries.

                  (c) DISABILITY. If the Executive's employment is terminated
by reason of the Executive's Disability during the Change of Control
Employment Period, this Agreement shall terminate without further obligations
to the Executive, other than for payment of Accrued Obligations and the
timely payment or provision of Other Benefits. Accrued Obligations shall be
paid to the Executive in a lump sum in cash within 30 days of the Date of
Termination. With respect to the provision of Other Benefits, the term Other
Benefits as utilized in this Section 6(c) shall include, without limitation,
and the Executive shall be entitled after the Disability Effective Date to
receive, disability and other benefits at least equal to the most favorable
of those generally provided by the Company and its affiliated companies to
disabled executives and/or their families in accordance with such plans,
programs, practices and policies relating to disability, if any, as in effect
generally with respect to other key executives and their families at any time
during the 120-day period immediately preceding the Effective Date or, if
more favorable to the Executive and/or the Executive's family, as in effect
at any time thereafter

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generally with respect to other key executives of the Company and its
affiliated companies and their families.

                  (d) CAUSE; OTHER THAN FOR GOOD REASON. If the Executive's
employment shall be terminated for Cause during the Change of Control
Employment Period, this Agreement shall terminate without further obligations
to the Executive other than the obligation to pay to the Executive (x) his
Change of Control Base Salary through the Date of Termination, (y) the amount
of any compensation previously deferred by the Executive, and (z) Other
Benefits, in each case to the extent theretofore unpaid. If the Executive
voluntarily terminates employment during the Change of Control Employment
Period, excluding a termination for Good Reason, this Agreement shall
terminate without further obligations to the Executive, other than for
Accrued Obligations and the timely payment or provision of Other Benefits. In
such case, all Accrued Obligations shall be paid to the Executive in a lump
sum in cash within 30 days of the Date of Termination.

          7. NON-EXCLUSIVITY OF RIGHTS. Nothing in this Agreement shall
prevent or limit the Executive's continuing or future participation in any
plan, program, policy or practice provided by the Company or any of its
affiliated companies and for which the Executive may qualify, nor, subject to
Section 12(f) shall anything herein limit or otherwise affect such rights as
the Executive may have under any contract or agreement with the Company or
any of its affiliated companies. Amounts which are vested benefits or which
the Executive is otherwise entitled to receive under any plan, policy,
practice or program of or any contract or agreement with the Company or any
of its affiliated companies at or subsequent to the Date of Termination shall
be payable in accordance with any such plan, policy, practice or program or
contract or agreement except as explicitly modified by this Agreement.

          8. FULL SETTLEMENT. The Company's obligation to make the payments
provided for in this Agreement and otherwise to perform its obligations
hereunder shall not be affected by any set-off, counterclaim, recoupment,
defense or other claim, right or action which the Company may have against
the Executive or others. In no event shall the Executive be obligated to seek
other employment or take any other action by way of mitigation of the amounts
payable to the Executive under any of the provisions of this Agreement and
such amounts shall not be reduced whether or not the Executive obtains other
employment. The Company agrees to pay as incurred, to the full extent
permitted by law, all legal fees and expenses which the Executive may
reasonably incur as a result of any contest by the Company, provided that the
Executive prevails in at least one material issue, the Executive or others of
the validity or enforceability of, or liability under, any provision of this
Agreement or any guarantee of performance thereof (including as a result of
any contest by the Executive about the amount of any payment pursuant to this
Agreement), plus in each case interest on any delayed payment at the
applicable Federal rate provided for in Section 7872(f)(2)(A) of the Internal
Revenue Code of 1986, as amended (the "Code").

                                       11
<PAGE>

          9. CERTAIN ADDITIONAL PAYMENTS BY THE COMPANY.

                  (a) Anything in this Agreement to the contrary
notwithstanding and except as set forth below, in the event it shall be
determined that any payment or distribution by the Company to or for the
benefit of the Executive (whether paid or payable or distributed or
distributable pursuant to the terms of this Agreement or otherwise, but
determined without regard to any additional payments required under this
Section 9) (a "Payment") would be subject to the excise tax imposed by
Section 4999 of the Code or any interest or penalties are incurred by the
Executive with respect to such excise tax (such excise tax, together with any
such interest and penalties, are hereinafter collectively referred to as the
"Excise Tax"), then the Executive shall be entitled to receive an additional
payment (a "Gross-Up Payment") in an amount such that after payment by the
Executive of all taxes (including any interest or penalties imposed with
respect to such taxes), including, without limitation, any income taxes (and
any interest or penalties imposed with respect thereto) and Excise Tax
imposed upon the Gross-Up Payment, the Executive retains an amount of the
Gross-Up Payment equal to the Excise Tax imposed upon the Payments.
Notwithstanding the foregoing provisions of this Section 9(a), if it shall be
determined that the Executive is entitled to a Gross-Up Payment, but that the
Payments do not exceed 110% of the greatest amount (the "Reduced Amount")
that could be paid to the Executive such that the receipt of Payments would
not give rise to any Excise Tax, then no Gross-Up Payment shall be made to
the Executive and the Payments, in the aggregate, shall be reduced to the
Reduced Amount.

                  (b) Subject to the provisions of Section 9(c), all
determinations required to be made under this Section 9, including whether
and when a Gross-Up Payment is required and the amount of such Gross-Up
Payment and the assumptions to be utilized in arriving at such determination,
shall be made by Deloitte & Touche LLP or such other certified public
accounting firm as may be designated by the Executive (the "Accounting Firm")
which shall provide detailed supporting calculations both to the Company and
the Executive within 15 business days of the receipt of notice from the
Executive that there has been a Payment, or such earlier time as is requested
by the Company. In the event that the Accounting Firm is serving as
accountant or auditor for the individual, entity or group effecting the
Change of Control, the Executive shall appoint another nationally-recognized
accounting firm to make the determinations required hereunder (which
accounting firm shall then be referred to as the Accounting Firm hereunder).
All fees and expenses of the Accounting Firm shall be borne solely by the
Company. Any Gross-Up Payment, as determined pursuant to this Section 9,
shall be paid by the Company to the Executive within five days of the receipt
of the Accounting Firm's determination. Any determination by the Accounting
Firm shall be binding upon the Company and the Executive. As a result of the
uncertainty in the application of Section 4999 of the Code at the time of the
initial determination by the Accounting Firm hereunder, it is possible that
Gross-Up Payments which will not have been made by the Company should have
been made ("Underpayment"), consistent with the calculations required to be
made hereunder. In the event that the Company exhausts its remedies pursuant
to Section 9(c) and the Executive thereafter is required to make a payment of

                                       12
<PAGE>

any Excise Tax, the Accounting Firm shall determine the amount of the
Underpayment that has occurred and any such Underpayment shall be promptly
paid by the Company to or for the benefit of the Executive.

                  (c) The Executive shall notify the Company in writing of
any claim by the Internal Revenue Service that, if successful, would require
the payment by the Company of the Gross-Up Payment. Such notification shall
be given as soon as practicable but no later than ten business days after the
Executive is informed in writing of such claim and shall apprise the Company
of the nature of such claim and the date on which such claim is requested to
be paid. The Executive shall not pay such claim prior to the expiration of
the 30-day period following the date on which it gives such notice to the
Company (or such shorter period ending on the date that any payment of taxes
with respect to such claim is due). If the Company notifies the Executive in
writing prior to the expiration of such period that it desires to contest
such claim, the Executive shall:

                  (i) give the Company any information reasonably requested by
          the Company relating to such claim,

                  (ii) take such action in connection with contesting such claim
          as the Company shall reasonably request in writing from time to time,
          including, without limitation, accepting legal representation with
          respect to such claim by an attorney reasonably selected by the
          Company,

                  (iii) cooperate with the Company in good faith in order
          effectively to contest such claim, and

                  (iv) permit the Company to participate in any proceedings
          relating to such claim;

                  provided, however, that the Company shall bear and pay
directly all costs and expenses (including additional interest and penalties)
incurred in connection with such contest and shall indemnify and hold the
Executive harmless, on an after-tax basis, for any Excise Tax or income tax
(including interest and penalties with respect thereto) imposed as a result of
such representation and payment of costs and expenses. Without limitation on the
foregoing provisions of this Section 9(c), the Company shall control all
proceedings taken in connection with such contest and, at its sole option, may
pursue or forgo any and all administrative appeals, proceedings, hearings and
conferences with the taxing authority in respect of such claim and may, at its
sole option, either direct the Executive to pay the tax claimed and sue for a
refund or contest the claim in any permissible manner, and the Executive agrees
to prosecute such contest to a determination before any administrative tribunal,
in a court of initial jurisdiction and in one or more appellate courts, as the
Company shall determine; provided, however, that if the Company directs the
Executive to pay such claim and sue for a refund, the Company shall advance the
amount of such payment to the Executive, on an interest-free basis and shall
indemnify and hold the Executive harmless, on an after-tax basis, from any
Excise Tax or income tax (including interest or penalties with respect thereto)
imposed with

                                       13
<PAGE>

respect to such advance or with respect to any imputed income with
respect to such advance; and further provided that any extension of the statute
of limitations relating to payment of taxes for the taxable year of the
Executive with respect to which such contested amount is claimed to be due is
limited solely to such contested amount. Furthermore, the Company's control of
the contest shall be limited to issues with respect to which a Gross-Up Payment
would be payable hereunder and the Executive shall be entitled to settle or
contest, as the case may be, any other issue raised by the Internal Revenue
Service or any other taxing authority.

                  (d) If, after the receipt by the Executive of an amount
advanced by the Company pursuant to Section 9(c), the Executive becomes
entitled to receive any refund with respect to such claim, the Executive
shall (subject to the Company's complying with the requirements of Section
9(c)) promptly pay to the Company the amount of such refund (together with
any interest paid or credited thereon after taxes applicable thereto). If,
after the receipt by the Executive of an amount advanced by the Company
pursuant to Section 9(c), a determination is made that the Executive shall
not be entitled to any refund with respect to such claim and the Company does
not notify the Executive in writing of its intent to contest such denial of
refund prior to the expiration of 30 days after such determination, then such
advance shall be forgiven and shall not be required to be repaid and the
amount of such advance shall offset, to the extent thereof, the amount of
Gross-Up Payment required to be paid.

          10. CONFIDENTIAL INFORMATION. The Executive shall hold in a
fiduciary capacity for the benefit of the Company all secret or confidential
information, knowledge or data relating to the Company or any of its
affiliated companies, and their respective businesses, which shall have been
obtained by the Executive during the Executive's employment by the Company or
any of its affiliated companies and which shall not be or become public
knowledge (other than by acts by the Executive or representatives of the
Executive in violation of this Agreement). After termination of the
Executive's employment with the Company, the Executive shall not, without the
prior written consent of the Company or as may otherwise be required by law
or legal process, communicate or divulge any such information, knowledge or
data to anyone other than the Company and those designated by it. In no event
shall an asserted violation of the provisions of this Section 10 constitute a
basis for deferring or withholding any amounts otherwise payable to the
Executive under this Agreement.

          11. SUCCESSORS; ASSIGNS.

                  (a) This Agreement is personal to the Executive and without
the prior written consent of the Company shall not be assignable by the
Executive otherwise than by will or the laws of descent and distribution.
This Agreement shall inure to the benefit of and be enforceable by the
Executive's legal representatives.

                  (b) The Company shall have the right to assign this
Agreement and to delegate all of its rights, duties and obligations hereunder
to any entity which controls the

                                       14
<PAGE>

Company, which the Company controls or which may be the result of the merger,
consolidation, acquisition or reorganization of the Company and another
entity. This Agreement shall inure to the benefit of and be binding upon the
Company and its successors and assigns.

                  (c) The Company will require any successor (whether direct
or indirect, by purchase, merger, consolidation or otherwise) to all or
substantially all of the business and/or assets of the Company to assume
expressly and agree to perform this Agreement in the same manner and to the
same extent that the Company would be required to perform it if no such
succession had taken place. As used in this Agreement, "Company" shall mean
the Company as hereinbefore defined and any successor to its business and/or
assets as aforesaid which assumes and agrees to perform this Agreement by
operation of law, or otherwise.

          12. MISCELLANEOUS.

                  (a) THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF DELAWARE, WITHOUT REGARD TO THE
CONFLICTS OF LAWS PRINCIPLES THEREOF. The captions of this Agreement are not
part of the provisions hereof and shall have no force on effect. This
Agreement may not be amended or modified otherwise than by a written
agreement executed by the parties hereto or their respective successors or
legal representatives.

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

                   If to the Company:        Beazer Homes USA, Inc.
                                             5775 Peachtree Dunwoody Road
                                             Suite B-200
                                             Atlanta, Georgia 30342
                                             Attn:  President
                                             Facsimile:  404-250-3428

                   If to the Executive:      C. Lowell Ball
                                             878 Birds Mill
                                             Marietta, Georgia  30067

                  Any party may change his or its address by written notice in
accordance with this Section 12(b). Notices delivered personally shall be deemed
communicated as of actual receipt; notices sent via facsimile transmission shall
be deemed communicated as of receipt by the sender of written confirmation of
transmission thereof; mailed notices shall be deemed communicated as of three
(3) days after proper mailing.

                                       15
<PAGE>

                  (c) The failure of the Executive or the Company to insist
upon strict compliance with any provision of this Agreement or the failure to
assert any right the Executive or the Company may have hereunder, including,
without limitation, the right of the Executive to terminate employment for
Good Reason pursuant to Section 5(c)(i)-(v) of this Agreement, shall not be
deemed to be a waiver of such provision or right or any other provision or
right of this Agreement.

                  (d) The invalidity or unenforceability of any provision of
this Agreement shall not affect the validity or enforceability of any other
provision of this Agreement.

                  (e) The Company may withhold from any amounts payable under
this Agreement such federal, state, local or foreign taxes as shall be
required to be withheld pursuant to any applicable law or regulation.

                  (f) The Executive and the Company acknowledge that, except
as may otherwise be provided under any other written agreement between the
Executive and the Company, the employment of the Executive by the Company is
"at will" and, subject to Section 1 hereof, prior to the Effective Date, the
Executive's employment and/or this Agreement may be terminated by either the
Executive or the Company at any time prior to the Effective Date, in which
case the Executive shall have no further rights under this Agreement. From
and after the Effective Date this Agreement shall supersede any other
agreement between the parties with respect tot he subject matter hereof.

                            [signature page follows]

                                       16
<PAGE>

                  IN WITNESS WHEREOF, THE PARTIES HERETO HAVE EXECUTED THIS
EMPLOYMENT AGREEMENT AS OF THE 7TH DAY OF NOVEMBER, 2000.

                                            ------------------------------------
                                            C. Lowell Ball

                                            BEAZER HOMES USA, INC.

                                            By:
                                               ---------------------------------
                                            Name:
                                            Title:<PAGE>

                                WARRANT AGREEMENT

                                     between

                               GMX RESOURCES INC.

                                       and

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

                          Dated as of ___________, 2001

<PAGE>

             This Agreement, dated as of ___________, 2001, is between GMX
Resources Inc., an Oklahoma corporation (the "Company") and UMB Bank, n.a., a
national banking association, (the "Warrant Agent").

             The Company, at or about the time that it is entering into this
Agreement, proposes to issue and sell to public investors up to 1,437,500
Units ("Units"). Each Unit consists of one share of Common Stock of the
Company ("Common Stock") one Class A Warrant (collectively, the "Class A
Warrants"), each Class A Warrant exercisable to purchase one share of Common
Stock and one Class B Warrant (collectively, the "Class B Warrants") each
Class B Warrant exercisable to purchase one share of Common Stock for the
Exercise Prices (hereinafter defined) upon the terms and conditions and
subject to adjustment in certain circumstances, all as set forth in this
Agreement. The Class A Warrants and the Class B Warrants are hereinafter
referred to, collectively, as the "Warrants".

             The Company proposes to issue to the Representative of the
Underwriters in the public offering of Units referred to above warrants to
purchase up to 125,000 additional Units.

             The Company wishes to retain the Warrant Agent to act on behalf of
the Company, and the Warrant Agent is willing so to act, in connection with the
issuance, transfer, exchange and replacement of the certificates evidencing the
Warrants to be issued under this Agreement (the "Warrant Certificates") and the
exercise of the Warrants;

             The Company and the Warrant Agent wish to enter into this Agreement
to set forth the terms and conditions of the Warrants and the rights of the
holders thereof ("Warrantholders") and to set forth the respective rights and
obligations of the Company and the Warrant Agent. Each Warrantholder is an
intended beneficiary of this Agreement with respect to the rights of
Warrantholders herein.

             NOW, THEREFORE, in consideration of the premises and the mutual
agreements herein set forth, the parties hereto agree as follows:

Section 1.  APPOINTMENT OF WARRANT AGENT

             The Company appoints the Warrant Agent to act as agent for the
Company in accordance with the instructions in this Agreement and the Warrant
Agent accepts such appointment.

Section 2.  DATE, DENOMINATION AND EXECUTION OF WARRANT CERTIFICATES

             The Warrant Certificates (and the Form of Election to Purchase
and the Form of Assignment to be printed on the reverse thereof) shall be in
registered form only and shall be substantially of the tenor and purport
recited in Exhibits A (with respect to Class A Warrants) and B (with respect
to Class B Warrants) hereto, and may have such letters, numbers or other
marks of identification or designation and such legends, summaries or
endorsements printed, lithographed or engraved thereon as the Company may
deem appropriate and as are not inconsistent with the provisions of this
Agreement, or as may be required to comply with any law, or with any rule or
regulation made pursuant thereto, or with any rule or regulation of any stock
exchange on which the Common Stock or the Warrants may be listed or any
automated quotation system, or to conform to usage. Each Class A Warrant
Certificate shall entitle the registered holder thereof, subject to the
provisions of this Agreement and of the Warrant Certificate, to purchase, on
or before the close of business on ____________ , 2002, one fully paid and
non-assessable share of Common Stock for each Warrant evidenced by such
Warrant Certificate for $________,

                                      2
<PAGE>

At any time after the close of business on __________, 2002 and on or before
the close of business on ____________, 2006 (the "Class A Expiration Date")
each Class A Warrant Certificate shall entitle the registered holder thereof,
subject to the provisions of this Agreement and of the Warrant Certificate,
to purchase one fully paid and non-assessable share of Common Stock for each
Warrant evidenced by such Warrant Certificate for $________ . The exercise
price of the Class A Warrants (the "Exercise Price") is subject to
adjustments as provided in Sections 6 hereof. Each Class B Warrant
Certificate shall entitle the registered holder thereof, subject to the
provisions of this Agreement and of the Warrant Certificate, to purchase, on
or before the close of business on ___________, 2003 (the "Class B Expiration
Date"), one fully paid and non-assessable share of Common Stock for each
Warrant evidenced by such Warrant Certificate for $_____, subject to
adjustments as provided in Sections 6 hereof, (the "Class B Exercise Price").
Each Class A Warrant Certificate and each Class B Warrant Certificate issued
as a part of a Unit offered to the public as described in the recitals,
above, shall be dated __________ __, 2001; each other Class A Warrant
Certificate and each Class B Warrant Certificate shall be dated the date on
which the Warrant Agent receives valid issuance instructions from the Company
or a transferring holder of a Warrant Certificate or, if such instructions
specify another date, such other date. The Class A Expiration Date and the
Class B Expiration Date are referred to as the "Expiration Date."

             For purposes of this Agreement, the term "close of business" on any
given date shall mean 5:00 p.m., Eastern time, on such date; provided, however,
that if such date is not a business day, it shall mean 5:00 p.m., Eastern time,
on the next succeeding business day. For purposes of this Agreement, the term
"business day" shall mean any day other than a Saturday, Sunday, or a day on
which banking institutions in New York, New York are authorized or obligated by
law to be closed.

             Each Warrant Certificate shall be executed on behalf of the Company
by the Chairman of the Board or its President or a Vice President, either
manually or by facsimile signature printed thereon, and have affixed thereto the
Company's seal or a facsimile thereof which shall be attested by the Secretary
or an Assistant Secretary of the Company, either manually or by facsimile
signature. Each Warrant Certificate shall be manually countersigned by the
Warrant Agent and shall not be valid for any purpose unless so countersigned. In
case any officer of the Company who shall have signed any Warrant Certificate
shall cease to be such officer of the Company before countersignature by the
Warrant Agent and issue and delivery thereof by the Company, such Warrant
Certificate, nevertheless, may be countersigned by the Warrant Agent, issued and
delivered with the same force and effect as though the person who signed such
Warrant Certificate had not ceased to be such officer of the Company.

Section 3.  SUBSEQUENT ISSUE OF WARRANT CERTIFICATES

             Subsequent to their original issuance, no Warrant Certificates
shall be reissued except (i) Warrant Certificates issued upon transfer thereof
in accordance with Section 4 hereof, (ii) Warrant Certificates issued upon any
combination, split-up or exchange of Warrant Certificates pursuant to Section 4
hereof, (iii) Warrant Certificates issued in replacement of mutilated,
destroyed, lost or stolen Warrant Certificates pursuant to Section 5 hereof,
(iv) Warrant Certificates issued upon the partial exercise of Warrant
Certificates pursuant to Section 7 hereof, and (v) Warrant Certificates issued
to reflect any adjustment or change in the Exercise Price or the number or kind
of shares purchasable thereunder pursuant to Section 22 hereof. The Warrant
Agent is hereby irrevocably authorized to countersign and deliver, in accordance
with the provisions of said Sections 4, 5, 7 and 22, the new Warrant
Certificates required for purposes thereof, and the Company, whenever required
by the Warrant Agent, will supply the Warrant Agent with Warrant Certificates
duly executed on behalf of the Company for such purposes.

Section 4.  TRANSFERS AND EXCHANGES OF WARRANT CERTIFICATES

             The Warrant Agent will keep or cause to be kept books for
registration of ownership and transfer of the Warrant Certificates issued
hereunder. Such registers shall show the names and addresses of the respective
holders of the Warrant Certificates and the kind and number of Warrants
evidenced by each such Warrant Certificate.

                                      3
<PAGE>

             The Warrant Agent shall, from time to time, register the transfer
of any outstanding Warrants upon the books to be maintained by the Warrant Agent
for that purpose, upon surrender of the Warrant Certificate evidencing such
Warrants, with the Form of Assignment duly filled in and executed with such
signature guaranteed by a banking institution or NASD member and such supporting
documentation as the Warrant Agent or the Company may reasonably require, to the
Warrant Agent at its stock transfer office in Kansas City, Missouri at any time
on or before the Expiration Date, and upon payment to the Warrant Agent for the
account of the Company of an amount equal to any applicable transfer tax.
Payment of the amount of such tax may be made in cash, or by certified or
official bank check, payable in lawful money of the United States of America to
the order of the Company.

             Upon receipt of a Warrant Certificate, with the Form of Assignment
duly filled in and executed, accompanied by payment of an amount equal to any
applicable transfer tax, the Warrant Agent shall promptly cancel the surrendered
Warrant Certificate and countersign and deliver to the transferee a new Warrant
Certificate for the number of full Class A Warrants or Class Be Warrants, as the
case may be, transferred to such transferee; PROVIDED, HOWEVER, that in case the
registered holder of any Warrant Certificate shall elect to transfer fewer than
all of the Warrants evidenced by such Warrant Certificate, the Warrant Agent in
addition shall promptly countersign and deliver to such registered holder a new
Warrant Certificate or Certificates for the number of full Class A Warrants or
Class B Warrants, as the case may be, not so transferred.

             Any Warrant Certificate or Certificates may be exchanged at the
option of the holder thereof for another Warrant Certificate or Certificates of
different denominations, of like tenor and representing in the aggregate the
same kind and number of Warrants, upon surrender of such Warrant Certificate or
Certificates, with the Form of Assignment duly filled in and executed, to the
Warrant Agent, at any time or from time to time after the close of business on
the date hereof and prior to the close of business on the Expiration Date. The
Warrant Agent shall promptly cancel the surrendered Warrant Certificate and
deliver the new Warrant Certificate pursuant to the provisions of this Section.

Section 5.  MUTILATED, DESTROYED, LOST OR STOLEN WARRANT CERTIFICATES

             Upon receipt by the Company and the Warrant Agent of evidence
reasonably satisfactory to them of the loss, theft, destruction or mutilation of
any Warrant Certificate, and in the case of loss, theft or destruction, of
indemnity or security reasonably satisfactory to them, and reimbursement to them
of all reasonable expenses incidental thereto, and, in the case of mutilation,
upon surrender and cancellation of the Warrant Certificate, the Warrant Agent
shall countersign and deliver a new Warrant Certificate of like tenor for the
same kind and number of Warrants.

Section 6.  ADJUSTMENTS OF NUMBER AND KIND OF SHARES PURCHASABLE AND EXERCISE
            PRICE

             The number and kind of securities or other property purchasable
upon exercise of a Warrant shall be subject to adjustment from time to time upon
the occurrence, after the date hereof, of any of the following events:

    A. In case the Company shall (1) pay a dividend in, or make a distribution
of, shares of capital stock on its outstanding Common Stock, (2) subdivide its
outstanding shares of Common Stock into a greater number of such shares or (3)
combine its outstanding shares of Common Stock into a smaller number of such
shares, the total number of shares of Common Stock purchasable upon the exercise
of each Class A Warrant outstanding immediately prior thereto and each Class B
Warrant, whether outstanding prior thereto or subsequently issued on exercise of
Class A Warrants shall be adjusted so that the holder of any Warrant Certificate
thereafter surrendered for exercise shall be entitled to receive at the same
aggregate Exercise Price the number of shares of capital stock (of one or more
classes) which such holder would have owned or have been entitled to receive
immediately following the happening of any of the events described above had
such Warrant been exercised in full immediately prior to the record date with
respect to such event. The above adjustment shall not affect the number of Class
B Warrants issuable on exercise of any Class A Warrant. Any adjustment made
pursuant to this Subsection shall, in the case of a stock dividend or
distribution, become effective as of the record date therefor and, in the case
of a subdivision or combination, be made as of the effective date thereof. If,
as a result of an adjustment made pursuant

                                      4
<PAGE>

to this Subsection, the holder of any Warrant Certificate thereafter
surrendered for exercise shall become entitled to receive shares of two or
more classes of capital stock of the Company, the Board of Directors of the
Company (whose determination shall be conclusive and shall be evidenced by a
Board resolution filed with the Warrant Agent) shall determine the allocation
of the adjusted Exercise Price between or among shares of such classes of
capital stock.

    B. In the event of a capital reorganization or a reclassification of the
Common Stock (except as provided in Subsection A. above or Subsection E. below),
any Warrantholder, upon exercise of Warrants, shall be entitled to receive, in
substitution for the Common Stock to which he would have become entitled upon
exercise immediately prior to such reorganization or reclassification, the
shares (of any class or classes) or other securities or property of the Company
(or cash) that he would have been entitled to receive at the same aggregate
Exercise Price upon such reorganization or reclassification if such Warrants had
been exercised immediately prior to the record date with respect to such event;
and in any such case, appropriate provision (as determined by the Board of
Directors of the Company, whose determination shall be conclusive and shall be
evidenced by a certified Board resolution filed with the Warrant Agent) shall be
made for the application of this Section 6 with respect to the rights and
interests thereafter of the Warrantholders (including but not limited to the
allocation of the Exercise Price between or among shares of classes of capital
stock), to the end that this Section 6 (including the adjustments of the number
of shares of Common Stock or other securities purchasable and the Exercise Price
thereof) shall thereafter be reflected, as nearly as reasonably practicable, in
all subsequent exercises of the Warrants for any shares or securities or other
property (or cash) thereafter deliverable upon the exercise of the Warrants. The
above adjustment shall not affect the number of Class B Warrants issuable on
exercise of any Class A Warrant.

    C. Whenever the number of shares of Common Stock or other securities
purchasable upon exercise of a Warrant is adjusted as provided in this Section
6, the Company will promptly file with the Warrant Agent a certificate signed by
a Chairman or co-Chairman of the Board or the President or a Vice President of
the Company and by the Treasurer or an Assistant Treasurer or the Secretary or
an Assistant Secretary of the Company setting forth the number and kind of
securities or other property purchasable upon exercise of a Class A Warrant and
a Class B Warrant, as so adjusted, stating that such adjustments in the number
or kind of shares or other securities or property conform to the requirements of
this Section 6, and setting forth a brief statement of the facts accounting for
such adjustments. Promptly after receipt of such certificate, the Company, or
the Warrant Agent at the Company's request, will deliver, by first-class,
postage prepaid mail, a brief summary thereof (to be supplied by the Company) to
the registered holders of the outstanding Warrant Certificates; PROVIDED,
HOWEVER, that failure to file or to give any notice required under this
Subsection, or any defect therein, shall not affect the legality or validity of
any such adjustments under this Section 6; and PROVIDED, FURTHER, that, where
appropriate, such notice may be given in advance and included as part of the
notice required to be given pursuant to Section 12 hereof.

    D. In case of any consolidation of the Company with, or merger of the
Company into, another corporation (other than a consolidation or merger which
does not result in any reclassification or change of the outstanding Common
Stock), or in case of any sale or conveyance to another corporation of the
property of the Company as an entirety or substantially as an entirety, the
corporation formed by such consolidation or merger or the corporation which
shall have acquired such assets, as the case may be, shall execute and deliver
to the Warrant Agent a supplemental warrant agreement providing that the holder
of each Warrant then outstanding shall have the right thereafter (until the
expiration of such Warrant) to receive, upon exercise of such Warrant, solely
the kind and amount of shares of stock and other securities and property (or
cash) receivable upon such consolidation, merger, sale or transfer by a holder
of the number of shares of Common Stock of the Company for which such Warrant,
and, in the case of the exercise of a Class A Warrant, the Class B Warrant for
which such Class A Warrant would otherwise have been exercisable, might have
been exercised immediately prior to such consolidation, merger, sale or
transfer. Such supplemental warrant agreement shall provide for adjustments
which shall be as nearly equivalent as may be practicable to the adjustments
provided in this Section. The above provision of this Subsection shall similarly
apply to successive consolidations, mergers, sales or transfers.

                                      5
<PAGE>

             The Warrant Agent shall not be under any responsibility to
determine the correctness of any provision contained in any such supplemental
warrant agreement relating to either the kind or amount of shares of stock or
securities or property (or cash) purchasable by holders of Warrant
Certificates upon the exercise of their Warrants after any such consolidation,
merger, sale or transfer or of any adjustment to be made with respect thereto,
but subject to the provisions of Section 20 hereof, may accept as conclusive
evidence of the correctness of any such provisions, and shall be protected in
relying upon, a certificate of a firm of independent certified public
accountants (who may be the accountants regularly employed by the Company)
with respect thereto.

    E. Irrespective of any adjustments in the number or kind of shares
issuable upon exercise of Warrants, Warrant Certificates theretofore or
thereafter issued may continue to express the same price and number and kind
of shares as are stated in the similar Warrant Certificates initially issuable
pursuant to this Warrant Agreement.

    F. The Company may retain a firm of independent public accountants of
recognized standing, which may be the firm regularly retained by the Company,
selected by the Board of Directors of the Company or the Executive Committee
of said Board, and not disapproved by the Warrant Agent, to make any
computation required under this Section, and a certificate signed by such firm
shall, in the absence of fraud or gross negligence, be conclusive evidence of
the correctness of any computation made under this Section.

    G. For the purpose of this Section, the term "Common Stock" shall mean (i)
the Common Stock or (ii) any other class of stock resulting from successive
changes or reclassifications of such Common Stock consisting solely of changes
in par value, or from par value to no par value, or from no par value to par
value. In the event that at any time as a result of an adjustment made
pursuant to this Section, the holder of any Warrant thereafter surrendered for
exercise shall become entitled to receive any shares of capital stock of the
Company other than shares of Common Stock, thereafter the number of such other
shares so receivable upon exercise of any Warrant shall be subject to
adjustment from time to time in a manner and on terms as nearly equivalent as
practicable to the provisions with respect to the Common Stock contained in
this Section, and all other provisions of this Agreement, with respect to the
Common Stock, shall apply on like terms to any such other shares.

    H. The Company may, from time to time and to the extent permitted by law,
reduce the exercise price of the Class A Warrants or Class B Warrants by any
amount for a period of not less than 20 days. If the Company so reduces the
exercise price of such Warrants, it will give not less than 15 days' notice of
such decrease, which notice may be in the form of a press release, and shall
take such other steps as may be required under applicable law in connection
with any offers or sales of securities at the reduced price.

Section 7. EXERCISE OF WARRANTS

             The registered holder of any Warrant Certificate may exercise the
Warrants evidenced thereby, in whole at any time or in part from time to time
at or prior to the close of business, on the Expiration Date, subject to the
provisions of Section 9, at which time the Warrant Certificates shall be and
become wholly void and of no value. Warrants may be exercised by their holders
or redeemed by the Company as follows:

    A. Exercise of Warrants shall be accomplished upon surrender of the
Warrant Certificate evidencing such Warrants, with the Form of Election to
Purchase on the reverse side thereof duly filled in and executed, to the
Warrant Agent at its stock transfer office in Kansas City, Missouri, together
with payment to the Company of the Exercise Price (as of the date of such
surrender) of the Warrants then being exercised and an amount equal to any
applicable transfer tax and, if requested by the Company, any other taxes or
governmental charges which the Company may be required by law to collect in
respect of such exercise. Payment of the Exercise Price and other amounts may
be made by wire transfer of good funds, or by certified or bank cashier's
check, payable in lawful money of the United States of America to the order of
the Company. No adjustment shall be made for any cash dividends, whether paid
or declared, on any securities issuable upon exercise of a Warrant.

    B. Upon receipt of a Warrant Certificate, with the Form of Election to
Purchase duly filled in and executed, accompanied by payment of the Exercise
Price of the Warrants being exercised (and of an amount equal to any

                                       6

<PAGE>

applicable taxes or government charges as aforesaid), the Warrant Agent shall
promptly request from the Transfer Agent with respect to the securities to be
issued and deliver to or upon the order of the registered holder of such
Warrant Certificate, in such name or names as such registered holder may
designate, a certificate or certificates for the number of full shares of the
securities to be purchased, together with cash made available by the Company
pursuant to Section 8 hereof in respect of any fraction of a share of such
securities otherwise issuable upon such exercise. If the Warrant is then
exercisable to purchase property other than securities, the Warrant Agent
shall take appropriate steps to cause such property to be delivered to or upon
the order of the registered holder of such Warrant Certificate. In addition,
if it is required by law and upon instruction by the Company, the Warrant
Agent will deliver to each Warrantholder a prospectus which complies with the
provisions of Section 9 of the Securities Act of 1933 and the Company agrees
to supply Warrant Agent with sufficient number of prospectuses to effectuate
that purpose.

    C. In case the registered holder of any Warrant Certificate shall exercise
fewer than all of the Warrants evidenced by such Warrant Certificate, the
Warrant Agent shall promptly countersign and deliver to the registered holder
of such Warrant Certificate, or to his duly authorized assigns, a new Warrant
Certificate or Certificates evidencing the number of Warrants that were not so
exercised.

    D. Each person in whose name any certificate for securities is issued upon
the exercise of Warrants shall for all purposes be deemed to have become the
holder of record of the securities represented thereby as of, and such
certificate shall be dated, the date upon which the Warrant Certificate was
duly surrendered in proper form and payment of the Exercise Price (and of any
applicable taxes or other governmental charges) was made; PROVIDED, HOWEVER,
that if the date of such surrender and payment is a date on which the stock
transfer books of the Company are closed, such person shall be deemed to have
become the record holder of such shares as of, and the certificate for such
shares shall be dated, the next succeeding business day on which the stock
transfer books of the Company are open (whether before, on or after the
Expiration Date) and the Warrant Agent shall be under no duty to deliver the
certificate for such shares until such date. The Company covenants and agrees
that it shall not cause its stock transfer books to be closed for a period of
more than 20 consecutive business days except upon consolidation, merger, sale
of all or substantially all of its assets, dissolution or liquidation or as
otherwise provided by law.

Section 8.  FRACTIONAL INTERESTS

             The Company shall not be required to issue any Warrant
Certificate evidencing a fraction of a Warrant or to issue fractions of shares
of securities on the exercise of the Warrants. If any fraction (calculated to
the nearest one-hundredth) of a Warrant or a share of securities would, except
for the provisions of this Section, be issuable on the exercise of any
Warrant, the Company shall, at its option, either purchase such fraction for
an amount in cash equal to the current value of such fraction computed on the
basis of the closing market price (as quoted on NASDAQ) on the trading day
immediately preceding the day upon which such Warrant Certificate was
surrendered for exercise in accordance with Section 7 hereof or issue the
required fractional Warrant or share. By accepting a Warrant Certificate, the
holder thereof expressly waives any right to receive a Warrant Certificate
evidencing any fraction of a Warrant or to receive any fractional share of
securities upon exercise of a Warrant, except as expressly provided in this
Section 8.

Section 9.  RESERVATION OF EQUITY SECURITIES

             The Company covenants that it will at all times reserve and keep
available, free from any pre-emptive rights, out of its authorized and
unissued equity securities, solely for the purpose of issue upon exercise of
the Warrants, such number of shares of equity securities of the Company as
shall then be issuable upon the exercise of all outstanding Warrants ("Equity
Securities"). The Company covenants that all Equity Securities which shall be
so issuable shall, upon such issue, be duly authorized, validly issued, fully
paid and non-assessable.

             The Company covenants that if any equity securities, required to
be reserved for the purpose of issue upon exercise of the Warrants hereunder,
require registration with or approval of any governmental authority under any
federal or state law before such shares may be issued upon exercise of
Warrants, the Company will use all

                                       7

<PAGE>

commercially reasonable efforts to cause such securities to be duly
registered, or approved, as the case may be, and, to the extent practicable,
take all such action in anticipation of and prior to the exercise of the
Warrants, including, without limitation, filing any and all post-effective
amendments to the Company's Registration Statement on Form SB-2 (Registration
No. 333-49328) necessary to permit a public offering of the securities
underlying the Warrants at any and all times during the term of this
Agreement, PROVIDED, HOWEVER, that in no event shall such securities be
issued, and the Company is authorized to refuse to honor the exercise of any
Warrant, if such exercise would result in the opinion of the Company's Board
of Directors, upon advice of counsel, in the violation of any law; and
PROVIDED FURTHER that, in the case of a Warrant exercisable solely for
securities listed on a securities exchange or for which there are at least two
independent market makers, in lieu of obtaining such registration or approval,
the Company may elect to redeem Warrants submitted to the Warrant Agent for
exercise for a price equal to the difference between the aggregate low asked
price, or closing price, as the case may be, of the securities for which such
Warrant is exercisable on the date of such submission and the Exercise Price
of such Warrants; in the event of such redemption, the Company will pay to the
holder of such Warrants the above-described redemption price in cash within 10
business days after receipt of notice from the Warrant Agent that such
Warrants have been submitted for exercise.

Section 10.  REDUCTION OF CONVERSION PRICE BELOW PAR VALUE

             Before taking any action that would cause an adjustment pursuant
to Section 6 hereof reducing the portion of the Exercise Price required to
purchase one share of capital stock below the then par value (if any) of a
share of such capital stock, the Company will use its best efforts to take any
corporate action which, in the opinion of its counsel, may be necessary in
order that the Company may validly and legally issue fully paid and
non-assessable shares of such capital stock.

Section 11.  PAYMENT OF TAXES

             The Company covenants and agrees that it will pay when due and
payable any and all federal and state documentary stamp and other original
issue taxes which may be payable in respect of the original issuance of the
Warrant Certificates, or any shares of Common Stock or other securities upon
the exercise of Warrants. The Company shall not, however, be required (i) to
pay any tax which may be payable in respect of any transfer involved in the
transfer and delivery of Warrant Certificates or the issuance or delivery of
certificates for Common Stock or other securities in a name other than that of
the registered holder of the Warrant Certificate surrendered for purchase or
(ii) to issue or deliver any certificate for shares of Common Stock or other
securities upon the exercise of any Warrant Certificate until any such tax
shall have been paid, all such tax being payable by the holder of such Warrant
Certificate at the time of surrender.

Section 12.  NOTICE OF CERTAIN CORPORATE ACTION

             In case the Company after the date hereof shall propose (i) to
offer to the holders of Common Stock, generally, rights to subscribe to or
purchase any additional shares of any class of its capital stock, any
evidences of its indebtedness or assets, or any other rights or options or
(ii) to effect any reclassification of Common Stock (other than a
reclassification involving merely the subdivision or combination of
outstanding shares of Common Stock) or any capital reorganization, or any
consolidation or merger to which the Company is a party and for which approval
of any stockholders of the Company is required, or any sale, transfer or other
disposition of its property and assets substantially as an entirety, or the
liquidation, voluntary or involuntary dissolution or winding-up of the
Company, then, in each such case, the Company shall file with the Warrant
Agent and the Company, or the Warrant Agent on its behalf, shall mail (by
first-class, postage prepaid mail) to all registered holders of the Warrant
Certificates notice of such proposed action, which notice shall specify the
date on which the books of the Company shall close or a record be taken for
such offer of rights or options, or the date on which such reclassification,
reorganization, consolidation, merger, sale, transfer, other disposition,
liquidation, voluntary or involuntary dissolution or winding-up shall take
place or commence, as the case may be, and which shall also specify any record
date for determination of holders of Common Stock entitled to vote thereon or
participate therein and shall set forth such facts with respect thereto as
shall be reasonably necessary to indicate any adjustments in the Exercise
Price and the

                                       8

<PAGE>

number or kind of shares or other securities purchasable upon exercise of
Warrants which will be required as a result of such action. Such notice shall
be filed and mailed in the case of any action covered by clause (i) above, at
least ten days prior to the record date for determining holders of the Common
Stock for purposes of such action or, if a record is not to be taken, the date
as of which the holders of shares of Common Stock of record are to be entitled
to such offering; and, in the case of any action covered by clause (ii) above,
at least 20 days prior to the earlier of the date on which such
reclassification, reorganization, consolidation, merger, sale, transfer, other
disposition, liquidation, voluntary or involuntary dissolution or winding-up
is expected to become effective and the date on which it is expected that
holders of shares of Common Stock of record on such date shall be entitled to
exchange their shares for securities or other property deliverable upon such
reclassification, reorganization, consolidation, merger, sale, transfer, other
disposition, liquidation, voluntary or involuntary dissolution or winding-up.

             Failure to give any such notice or any defect therein shall not
affect the legality or validity of any transaction listed in this Section 12.

Section 13.  DISPOSITION OF PROCEEDS ON EXERCISE OF WARRANT CERTIFICATES, ETC.

             The Warrant Agent shall account promptly to the Company with
respect to Warrants exercised and concurrently pay to the Company all moneys
received by the Warrant Agent for the purchase of securities or other property
through the exercise of such Warrants.

             The Warrant Agent shall keep copies of this Agreement available
for inspection by Warrantholders during normal business hours at its stock
transfer office. Copies of this Agreement may be obtained upon written request
addressed to the Warrant Agent at its stock transfer office in Kansas City,
Missouri.

Section 14.  WARRANTHOLDER NOT DEEMED A STOCKHOLDER

             No Warrantholder, as such, shall be entitled to vote, receive
dividends or be deemed the holder of Common Stock or any other securities of
the Company which may at any time be issuable on the exercise of the Warrants
represented thereby for any purpose whatever, nor shall anything contained
herein or in any Warrant Certificate be construed to confer upon any
Warrantholder, as such, any of the rights of a stockholder of the Company or
any right to vote for the election of directors or upon any matter submitted
to stockholders at any meeting thereof, or to give or withhold consent to any
corporate action (whether upon any recapitalization, issuance of stock,
reclassification of stock, change of par value or change of stock to no par
value, consolidation, merger, conveyance or otherwise), or to receive notice
of meetings or other actions affecting stockholders (except as provided in
Section 12 hereof), or to receive dividend or subscription rights, or
otherwise, until such Warrant Certificate shall have been exercised in
accordance with the provisions hereof and the receipt of the Exercise Price
and any other amounts payable upon such exercise by the Warrant Agent.

Section 15.  RIGHT OF ACTION

             All rights of action in respect to this Agreement are vested in
the respective registered holders of the Warrant Certificates; and any
registered holder of any Warrant Certificate, without the consent of the
Warrant Agent or of any other holder of a Warrant Certificate, may, in his own
behalf for his own benefit, enforce, and may institute and maintain any suit,
action or proceeding against the Company suitable to enforce, or otherwise in
respect of, his right to exercise the Warrants evidenced by such Warrant
Certificate, for the purchase of shares of the Common Stock in the manner
provided in the Warrant Certificate and in this Agreement.

Section 16.  AGREEMENT OF HOLDERS OF WARRANT CERTIFICATES

             Every holder of a Warrant Certificate by accepting the same
consents and agrees with the Company, the Warrant Agent and with every other
holder of a Warrant Certificate that:

                                       9

<PAGE>

    A. the Warrant Certificates are transferable on the registry books of the
Warrant Agent only upon the terms and conditions set forth in this Agreement;
and

    B. the Company and the Warrant Agent may deem and treat the person in whose
name the Warrant Certificate is registered as the absolute owner of the Warrant
(notwithstanding any notation of ownership or other writing thereon made by
anyone other than the Company or the Warrant Agent) for all purposes whatever
and neither the Company nor the Warrant Agent shall be affected by any notice to
the contrary.

Section 17.  CANCELLATION OF WARRANT CERTIFICATES

             In the event that the Company shall purchase or otherwise acquire
any Warrant Certificate or Certificates after the issuance thereof, such Warrant
Certificate or Certificates shall thereupon be delivered to the Warrant Agent
and be canceled by it and retired. The Warrant Agent shall also cancel any
Warrant Certificate delivered to it for exercise, in whole or in part, or
delivered to it for transfer, split-up, combination or exchange. Warrant
Certificates so canceled shall be delivered by the Warrant Agent to the Company
from time to time, or disposed of in accordance with the instructions of the
Company.

Section 18.  CONCERNING THE WARRANT AGENT

             The Company agrees to pay to the Warrant Agent from time to time,
on demand of the Warrant Agent, reasonable compensation for all services
rendered by it hereunder and also its reasonable expenses, including counsel
fees, and other disbursements incurred in the administration and execution of
this Agreement and the exercise and performance of its duties hereunder. The
Company also agrees to indemnify the Warrant Agent for, and to hold it harmless
against, any loss, liability or expense, incurred without gross negligence, bad
faith or willful misconduct on the part of the Warrant Agent, arising out of or
in connection with the acceptance and administration of this Agreement.

Section 19.  MERGER OR CONSOLIDATION OR CHANGE OF NAME OF WARRANT AGENT

             Any corporation into which the Warrant Agent may be merged or with
which it may be consolidated, or any corporation resulting from any merger or
consolidation to which the Warrant Agent shall be a party, or any corporation
succeeding to the corporate trust business of the Warrant Agent, shall be the
successor to the Warrant Agent hereunder without the execution or filing of any
paper or any further act on the part of any of the parties hereto, provided that
such corporation would be eligible for appointment as a successor warrant agent
under the provisions of Section 21 hereof. In case at the time such successor to
the Warrant Agent shall succeed to the agency created by this Agreement, any of
the Warrant Certificates shall have been countersigned but not delivered, any
such successor to the Warrant Agent may adopt the countersignature of the
original Warrant Agent and deliver such Warrant Certificates so countersigned;
and in case at that time any of the Warrant Certificates shall not have been
countersigned, any successor to the Warrant Agent may countersign such Warrant
Certificates either in the name of the predecessor Warrant Agent or in the name
of the successor Warrant Agent; and in all such cases such Warrant Certificates
shall have the full force provided in the Warrant Certificates and in this
Agreement.

             In case at any time the name of the Warrant Agent shall be changed
and at such time any of the Warrant Certificates shall have been countersigned
but not delivered, the Warrant Agent may adopt the countersignature under its
prior name and deliver Warrant Certificates so countersigned; and in case at
that time any of the Warrant Certificates shall not have been countersigned, the
Warrant Agent may countersign such Warrant Certificates either in its prior name
or in its changed name; and in all such cases such Warrant Certificates shall
have the full force provided in the Warrant Certificates and in this Agreement.

Section 20.  DUTIES OF WARRANT AGENT

                                      10
<PAGE>

             The Warrant Agent undertakes the duties and obligations imposed by
this Agreement upon the following terms and conditions, by all of which the
Company and the holders of Warrant Certificates, by their acceptance thereof,
shall be bound:

    A. The Warrant Agent may consult with counsel satisfactory to it (who may be
counsel for the Company or the Warrant Agent's in-house counsel), and the
opinion of such counsel shall be full and complete authorization and protection
to the Warrant Agent as to any action taken, suffered or omitted by it in good
faith and in accordance with such opinion; PROVIDED, HOWEVER, that the Warrant
Agent shall have exercised reasonable care in the selection of such counsel.
Fees and expenses of such counsel, to the extent reasonable, shall be paid by
the Company.

    B. Whenever in the performance of its duties under this Agreement, the
Warrant Agent shall deem it necessary or desirable that any fact or matter be
proved or established by the Company prior to taking or suffering any action
hereunder, such fact or matter (unless other evidence in respect thereof be
herein specifically prescribed) may be deemed to be conclusively proved and
established by a certificate signed by a Chairman or co-Chairman of the Board or
the President or a Vice President or the Secretary of the Company and delivered
to the Warrant Agent; and such certificate shall be full authorization to the
Warrant Agent for any action taken or suffered in good faith by it under the
provisions of this Agreement in reliance upon such certificate.

    C. The Warrant Agent shall be liable hereunder only for its own gross
negligence, bad faith or willful misconduct.

    D. The Warrant Agent shall not be liable for or by reason of any of the
statements of fact or recitals contained in this Agreement or in the Warrant
Certificates (except its countersignature on the Warrant Certificates and such
statements or recitals as describe the Warrant Agent or action taken or to be
taken by it) or be required to verify the same, but all such statements and
recitals are and shall be deemed to have been made by the Company only.

    E. The Warrant Agent shall not be under any responsibility in respect of the
validity of this Agreement or the execution and delivery hereof (except the due
execution hereof by the Warrant Agent) or in respect of the validity or
execution of any Warrant Certificate (except its countersignature thereof); nor
shall it be responsible for any breach by the Company of any covenant or
condition contained in this Agreement or in any Warrant Certificate; nor shall
it be responsible for the making of any change in the number of shares of Common
Stock for which a Warrant is exercisable required under the provisions of
Section 6 or responsible for the manner, method or amount of any such change or
the ascertaining of the existence of facts that would require any such
adjustment or change (except with respect to the exercise of Warrant
Certificates after actual notice of any adjustment of the Exercise Price); nor
shall it by any act hereunder be deemed to make any representation or warranty
as to the authorization or reservation of any shares of Common Stock to be
issued pursuant to this Agreement or any Warrant Certificate or as to whether
any shares of Common Stock will, when issued, be validly issued, fully paid and
non-assessable.

    F. The Warrant Agent shall be under no obligation to institute any action,
suit or legal proceeding or take any other action likely to involve expense
unless the Company or one or more registered holders of Warrant Certificates
shall furnish the Warrant Agent with reasonable security and indemnity for any
costs and expenses which may be incurred. All rights of action under this
Agreement or under any of the Warrants may be enforced by the Warrant Agent
without the possession of any of the Warrants or the production thereof at any
trial or other proceeding relative thereto, and any such action, suit or
proceeding instituted by the Warrant Agent shall be brought in its name as
Warrant Agent, and any recovery of judgment shall be for the ratable benefit of
the registered holders of the Warrant Certificates, as their respective rights
or interests may appear.

    G. The Warrant Agent and any stockholder, director, officer or employee of
the Warrant Agent may buy, sell or deal in any of the Warrants or other
securities of the Company or become pecuniarily interested in any transaction in
which the Company may be interested, or contract with or lend money to or
otherwise act as fully and freely as though it were not Warrant Agent under this
Agreement. Nothing herein shall preclude the Warrant Agent from acting in any
other capacity for the Company or for any other legal entity.

                                      11
<PAGE>

    H. The Warrant Agent is hereby authorized and directed to accept
instructions with respect to the performance of its duties hereunder from a
Chairman or co-Chairman of the Board or President or a Vice President or the
Secretary or the Controller of the Company, and to apply to such officers for
advice or instructions in connection with the Warrant Agent's duties, and it
shall not be liable for any action taken or suffered or omitted by it in good
faith in accordance with instructions of any such officer.

    I. The Warrant Agent will not be responsible for any failure of the Company
to comply with any of the covenants contained in this Agreement or in the
Warrant Certificates to be complied with by the Company.

    J. The Warrant Agent may execute and exercise any of the rights or powers
hereby vested in it or perform any duty hereunder either itself or by or through
its attorneys, agents or employees and the Warrant Agent shall not be answerable
or accountable for any act, default, neglect or misconduct of any such
attorneys, agents or employees or for any loss to the Company resulting from
such neglect or misconduct; PROVIDED, HOWEVER, that reasonable care shall have
been exercised in the selection and continued employment of such attorneys,
agents and employees.

    K. The Warrant Agent will not incur any liability or responsibility to the
Company or to any holder of any Warrant Certificate for any action taken, or any
failure to take action, in reliance on any notice, resolution, waiver, consent,
order, certificate, or other paper, document or instrument reasonably believed
by the Warrant Agent to be genuine and to have been signed, sent or presented by
the proper party or parties.

    L. The Warrant Agent will act hereunder solely as agent of the Company in a
ministerial capacity, and its duties will be determined solely by the provisions
hereof. The Warrant Agent will not be liable for anything which it may do or
refrain from doing in connection with this Agreement except for its own
negligence, bad faith or willful conduct.

Section 21.  CHANGE OF WARRANT AGENT

             The Warrant Agent may resign and be discharged from its duties
under this Agreement upon 30 days' prior notice in writing mailed, by registered
or certified mail, to the Company. The Company may remove the Warrant Agent or
any successor warrant agent upon 30 days' prior notice in writing, mailed to the
Warrant Agent or successor warrant agent, as the case may be, by registered or
certified mail. If the Warrant Agent shall resign or be removed or shall
otherwise become incapable of acting, the Company shall appoint a successor to
the Warrant Agent and shall, within 15 days following such appointment, give
notice thereof in writing to each registered holder of the Warrant Certificates.
If the Company shall fail to make such appointment within a period of 15 days
after giving notice of such removal or after it has been notified in writing of
such resignation or incapacity by the resigning or incapacitated Warrant Agent,
then the Company agrees to perform the duties of the Warrant Agent hereunder
until a successor Warrant Agent is appointed. After appointment and execution of
a copy of this Agreement in effect at that time, the successor Warrant Agent
shall be vested with the same powers, rights, duties and responsibilities as if
it had been originally named as Warrant Agent without further act or deed; but
the former Warrant Agent shall deliver and transfer to the successor Warrant
Agent, within a reasonable time, any property at the time held by it hereunder,
and execute and deliver any further assurance, conveyance, act or deed necessary
for the purpose. Failure to give any notice provided for in this Section,
however, or any defect therein shall not affect the legality or validity of the
resignation or removal of the Warrant Agent or the appointment of the successor
warrant agent, as the case may be.

Section 22.  ISSUANCE OF NEW WARRANT CERTIFICATES

             Notwithstanding any of the provisions of this Agreement or the
several Warrant Certificates to the contrary, the Company may, at its option,
issue new Warrant Certificates in such form as may be approved by its Board of
Directors to reflect any adjustment or change in the Exercise Price or the
number or kind of shares purchasable under the several Warrant Certificates made
in accordance with the provisions of this Agreement.

Section 23.  NOTICES

                                      12
<PAGE>

             Notice or demand pursuant to this Agreement to be given or made on
the Company by the Warrant Agent or by the registered holder of any Warrant
Certificate shall be sufficiently given or made if sent by first-class or
registered mail, postage prepaid, addressed (until another address is filed in
writing by the Company with the Warrant Agent) as follows:

             GMX Resources Inc.
             One Benham Place, Suite 600
             9400 North Broadway
             Oklahoma City, Oklahoma 73114

             Subject to the provisions of Section 21, any notice pursuant to
this Agreement to be given or made by the Company or by the holder of any
Warrant Certificate to or on the Warrant Agent shall be sufficiently given or
made if sent by first-class or registered mail, postage prepaid, addressed
(until another address is filed in writing by the Warrant Agent with the
Company) as follows:

             UMB Bank, n.a.
             -------------------------
             Kansas City, Missouri

             Any notice or demand authorized to be given or made to the
registered holder of any Warrant Certificate under this Agreement shall be
sufficiently given or made if sent by first-class or registered mail, postage
prepaid, to the last address of such holder as it shall appear on the registers
maintained by the Warrant Agent.

Section 24.  MODIFICATION OF AGREEMENT

             The Warrant Agent may, without the consent or concurrence of the
Warrantholders, by supplemental agreement or otherwise, concur with the Company
in making any changes or corrections in this Agreement that the Warrant Agent
shall have been advised by counsel (who may be counsel for the Company) are
necessary or desirable to cure any ambiguity or to correct any defective or
inconsistent provision or clerical omission or mistake or manifest error herein
contained, or to make any other provisions in regard to matters or questions
arising hereunder and which shall not be inconsistent with the provisions of the
Warrant Certificates and which shall not adversely affect the interests of the
Warrantholders. As of the date hereof, this Agreement contains the entire and
only agreement, understanding, representation, condition, warranty or covenant
between the parties hereto with respect to the matters herein, supersedes any
and all other agreements between the parties hereto relating to such matters,
and may be modified or amended only by a written agreement signed by both
parties hereto pursuant to the authority granted by the first sentence of this
Section.

Section 25.  SUCCESSORS

             All the covenants and provisions of this Agreement by or for the
benefit of the Company or the Warrant Agent shall bind and inure to the benefit
of their respective successors and assigns hereunder.

Section 26.  OKLAHOMA CONTRACT

             This Agreement and each Warrant Certificate issued hereunder shall
be deemed to be a contract made under the laws of the State of Oklahoma and for
all purposes shall be construed in accordance with the laws of said State.

Section 27.  TERMINATION

                                      13
<PAGE>

             This Agreement shall terminate as of the close of business on the
Expiration Date, or such earlier date upon which all Warrants shall have been
exercised or redeemed, except that the Warrant Agent shall account to the
Company as to all Warrants outstanding and all cash held by it as of the close
of business on the Expiration Date.

Section 28.  BENEFITS OF THIS AGREEMENT

             Nothing in this Agreement or in the Warrant Certificates shall be
construed to give to any person or corporation other than the Company, the
Warrant Agent, and their respective successors and assigns hereunder and the
registered holders of the Warrant Certificates any legal or equitable right,
remedy or claim under this Agreement; but this Agreement shall be for the sole
and exclusive benefit of the Company, the Warrant Agent, their respective
successors and assigns hereunder and the registered holders of the Warrant
Certificates.

Section 29.  DESCRIPTIVE HEADINGS

             The descriptive headings of the several Sections of this Agreement
are inserted for convenience only and shall not control or affect the meaning or
construction of any of the provisions hereof.

Section 30.  COUNTERPARTS

             This Agreement may be executed in any number of counterparts, each
of which shall be an original, but such counterparts shall together constitute
one and the same instrument.

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

GMX Resources Inc.

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

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

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

                                      14

<PAGE>

                                                                       EXHIBIT A

            VOID AFTER 5 P.M. PACIFIC TIME ON ________________, 2006

                        WARRANTS TO PURCHASE COMMON STOCK

WA_____                    _________ Class A Warrants

                               GMX RESOURCES INC.

                              CUSIP ______________

THIS CERTIFIES THAT

or registered assigns, is the registered holder of the number of Class A
Warrants ("Class A Warrants") set forth above. Each Class A Warrant entitles
the holder thereof to purchase from GMX Resources Inc., a corporation
incorporated under the laws of the State of Delaware ("Company"), subject to
the terms and conditions set forth hereinafter and in the Warrant Agreement
hereinafter more fully described (the "Warrant Agreement") referred to, (A)
at any time on or before the close of business on ________ __, 2006 (the
"Expiration Date"), one fully paid and non-assessable share of Common Stock
Stock of the Company ("Common Stock") upon presentation and surrender of this
Warrant Certificate, with the instructions for the registration and delivery
of Common Stock filled in, at the stock transfer office in Kansas City,
Missouri, of UMB Bank, n.s., Warrant Agent of the Company ("Warrant Agent")
or of its successor warrant agent or, if there be no successor warrant agent,
at the corporate offices of the Company, and upon payment of the Exercise
Price (as defined in the Warrant Agreement) and any applicable taxes paid
either in cash, or by certified or official bank check, payable in lawful
money of the United States of America to the order of the Company. The
Exercise Price shall be $____ with respect to any exercise on or before the
close of business on ___________, 2002 and shall be $_____ with respect to
any exercise after that date and time, subject to adjustment as set forth
below. The number and kind of securities or other property for which the
Class A Warrants are exercisable are subject to further adjustment in certain
events, such as mergers, splits, stock dividends, recapitalizations and the
like, to prevent dilution. All Class A Warrants not theretofore exercised
will expire on the Expiration Date.

             This Warrant Certificate is subject to all of the terms, provisions
and conditions of the Warrant Agreement, dated as of ___________, 2001 ("Warrant
Agreement"), between the Company and the Warrant Agent, to all of which terms,
provisions and conditions the registered holder of this Warrant Certificate
consents by acceptance hereof. The Warrant Agreement is incorporated herein by
reference and made a part hereof and reference is made to the Warrant Agreement
for a full description of the rights, limitations of rights, obligations, duties
and immunities of the Warrant Agent, the Company and the holders of the Warrant
Certificates. Copies of the Warrant Agreement are available for inspection at
the stock transfer office of the Warrant Agent or may be obtained upon written
request addressed to the Company at GMX Resources Inc., One Benham Place, Suite
600, 9400 North Broadway, Oklahoma City, Oklahoma 73114, Attention: Chief
Financial Officer.

                                       i
<PAGE>

             The Company shall not be required upon the exercise of the Class A
Warrants evidenced by this Warrant Certificate to issue fractions of Class A
Warrants, Common Stock or other securities, but shall make adjustment therefor
in cash on the basis of the current market value of any fractional interest as
provided in the Warrant Agreement.

             In certain cases, the sale of securities by the Company upon
exercise of Class A Warrants would violate the securities laws of the United
States, certain states thereof or other jurisdictions. The Company has agreed to
use all commercially reasonable efforts to cause a registration statement to
continue to be effective during the term of the Class A Warrants with respect to
such sales under the Securities Act of 1933, and to take such action under the
laws of various states as may be required to cause the sale of securities upon
exercise to be lawful. However, the Company will not be required to honor the
exercise of Class A Warrants if, in the opinion of the Board of Directors, upon
advice of counsel, the sale of securities upon such exercise would be unlawful.
In certain cases, the Company may, but is not required to, purchase Class A
Warrants submitted for exercise for a cash price equal to the difference between
the market price of the securities obtainable upon such exercise and the
exercise price of such Class A Warrants.

             This Warrant Certificate, with or without other Certificates, upon
surrender to the Warrant Agent, any successor warrant agent or, in the absence
of any successor warrant agent, at the corporate offices of the Company, may be
exchanged for another Warrant Certificate or Certificates evidencing in the
aggregate the same number of Class A Warrants as the Warrant Certificate or
Certificates so surrendered. If the Class A Warrants evidenced by this Warrant
Certificate shall be exercised in part, the holder hereof shall be entitled to
receive upon surrender hereof another Warrant Certificate or Certificates
evidencing the number of Class A Warrants not so exercised.

             No holder of this Warrant Certificate, as such, shall be entitled
to vote, receive dividends or be deemed the holder of Common Stock or any other
securities of the Company which may at any time be issuable on the exercise
hereof for any purpose whatever, nor shall anything contained in the Warrant
Agreement or herein be construed to confer upon the holder of this Warrant
Certificate, as such, any of the rights of a stockholder of the Company or any
right to vote for the election of directors or upon any matter submitted to
stockholders at any meeting thereof or give or withhold consent to any corporate
action (whether upon any matter submitted to stockholders at any meeting
thereof, or give or withhold consent to any merger, recapitalization, issuance
of stock, reclassification of stock, change of par value or change of stock to
no par value, consolidation, conveyance or otherwise) or to receive notice of
meetings or other actions affecting stockholders (except as provided in the
Warrant Agreement) or to receive dividends or subscription rights or otherwise
until the Class A Warrants evidenced by this Warrant Certificate shall have been
exercised and the Common Stock purchasable upon the exercise thereof shall have
become deliverable as provided in the Warrant Agreement.

             If this Warrant Certificate shall be surrendered for exercise
within any period during which the transfer books for the Company's Common Stock
or other class of stock purchasable upon the exercise of the Class A Warrants
evidenced by this Warrant Certificate are closed for any purpose, the Company
shall not be required to make delivery of certificates for shares purchasable
upon such transfer until the date of the reopening of said transfer books.

             Every holder of this Warrant Certificate by accepting the same
consents and agrees with the Company, the Warrant Agent, and with every other
holder of a Warrant Certificate that:

    (a) this Warrant Certificate is transferable on the registry books of the
Warrant Agent only upon the terms and conditions set forth in the Warrant
Agreement, and

(b) the Company and the Warrant Agent may deem and treat the person in whose
name this Warrant Certificate is registered as the absolute owner hereof
(notwithstanding any notation of ownership or other writing thereon made by
anyone other than the Company or the Warrant Agent) for all purposes whatever
and neither the Company nor the Warrant Agent shall be affected by any notice to
the contrary. The Company shall not be required to issue or deliver any
certificate for shares of Common Stock or other securities upon the exercise of
Class A Warrants

                                      ii
<PAGE>

evidenced by this Warrant Certificate until any tax which may be payable in
respect thereof by the holder of this Warrant Certificate pursuant to the
Warrant Agreement shall have been paid, such tax being payable by the holder
of this Warrant Certificate at the time of surrender.

             This Warrant Certificate shall not be valid or obligatory for any
purpose until it shall have been countersigned by the Warrant Agent.

             WITNESS the facsimile signatures of the proper officers of the
Company and its corporate seal.

Dated:
                                           GMX Resources  Inc.

                                           By:
                                              -------------------------------
                                           Chief Executive Officer

                                           Attest:
                                                  ---------------------------
                                           Secretary

Countersigned

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

By:
   -------------------------
   Authorized Officer

                                     iii

<PAGE>

                                                                       EXHIBIT B

             VOID AFTER 5 P.M. PACIFIC TIME ON ____________ __, 2003

                        WARRANTS TO PURCHASE COMMON STOCK

WA_____                    _________ Class B Warrants

                               GMX RESOURCES INC.

                              CUSIP ______________

THIS CERTIFIES THAT

or registered assigns, is the registered holder of the number of Class B
Warrants ("Class B Warrants") set forth above. Each Class B Warrant entitles
the holder thereof to purchase from GMX Resources Inc., a corporation
incorporated under the laws of the State of Delaware ("Company"), subject to
the terms and conditions set forth hereinafter and in the Warrant Agreement
hereinafter more fully described (the "Warrant Agreement") referred to, at any
time on or before the close of business on December __, 2003 (the "Expiration
Date"), one fully paid and non-assessable share of Common Stock Stock of the
Company ("Common Stock") upon presentation and surrender of this Warrant
Certificate, with the instructions for the registration and delivery of Common
Stock filled in, at the stock transfer office in Kansas City, Missouri, of UMB
Bank, n.a., Warrant Agent of the Company ("Warrant Agent") or of its successor
warrant agent or, if there be no successor warrant agent, at the corporate
offices of the Company, and upon payment of the Exercise Price (as defined in
the Warrant Agreement) and any applicable taxes paid either in cash, or by
certified or official bank check, payable in lawful money of the United States
of America to the order of the Company. Each Class B Warrant initially entitles
the holder to purchase one share of Common Stock for $____. The number and kind
of securities or other property for which the Class B Warrants are exercisable
are subject to further adjustment in certain events, such as mergers, splits,
stock dividends, recapitalizations and the like, to prevent dilution. All Class
B Warrants not theretofore exercised will expire on the Expiration Date.

             This Warrant Certificate is subject to all of the terms,
provisions and conditions of the Warrant Agreement, dated as of ___________,
2001 ("Warrant Agreement"), between the Company and the Warrant Agent, to all
of which terms, provisions and conditions the registered holder of this Warrant
Certificate consents by acceptance hereof. The Warrant Agreement is
incorporated herein by reference and made a part hereof and reference is made
to the Warrant Agreement for a full description of the rights, limitations of
rights, obligations, duties and immunities of the Warrant Agent, the Company
and the holders of the Warrant Certificates. Copies of the Warrant Agreement
are available for inspection at the stock transfer office of the Warrant Agent
or may be obtained upon written request addressed to the Company at GMX
Resources Inc., One Benham Place, Suite 600, 9400 North Broadway, Oklahoma
City, Oklahoma 73114, Attention: Chief Financial Officer.

             The Company shall not be required upon the exercise of the Class B
Warrants evidenced by this Warrant Certificate to issue fractions of Class B
Warrants, Common Stock or other securities, but shall make adjustment therefor
in cash on the basis of the current market value of any fractional interest as
provided in the Warrant Agreement.

             In certain cases, the sale of securities by the Company upon
exercise of Class B Warrants would violate the securities laws of the United
States, certain states thereof or other jurisdictions. The Company has agreed
to use

                                      iv
<PAGE>

all commercially reasonable efforts to cause a registration statement to
continue to be effective during the term of the Class B Warrants with respect
to such sales under the Securities Act of 1933, and to take such action under
the laws of various states as may be required to cause the sale of securities
upon exercise to be lawful. However, the Company will not be required to honor
the exercise of Class B Warrants if, in the opinion of the Board of Directors,
upon advice of counsel, the sale of securities upon such exercise would be
unlawful. In certain cases, the Company may, but is not required to, purchase
Class B Warrants submitted for exercise for a cash price equal to the
difference between the market price of the securities obtainable upon such
exercise and the exercise price of such Class B Warrants.

             This Warrant Certificate, with or without other Certificates, upon
surrender to the Warrant Agent, any successor warrant agent or, in the absence
of any successor warrant agent, at the corporate offices of the Company, may be
exchanged for another Warrant Certificate or Certificates evidencing in the
aggregate the same number of Class B Warrants as the Warrant Certificate or
Certificates so surrendered. If the Class B Warrants evidenced by this Warrant
Certificate shall be exercised in part, the holder hereof shall be entitled to
receive upon surrender hereof another Warrant Certificate or Certificates
evidencing the number of Class B Warrants not so exercised.

             No holder of this Warrant Certificate, as such, shall be entitled
to vote, receive dividends or be deemed the holder of Common Stock or any other
securities of the Company which may at any time be issuable on the exercise
hereof for any purpose whatever, nor shall anything contained in the Warrant
Agreement or herein be construed to confer upon the holder of this Warrant
Certificate, as such, any of the rights of a stockholder of the Company or any
right to vote for the election of directors or upon any matter submitted to
stockholders at any meeting thereof or give or withhold consent to any
corporate action (whether upon any matter submitted to stockholders at any
meeting thereof, or give or withhold consent to any merger, recapitalization,
issuance of stock, reclassification of stock, change of par value or change of
stock to no par value, consolidation, conveyance or otherwise) or to receive
notice of meetings or other actions affecting stockholders (except as provided
in the Warrant Agreement) or to receive dividends or subscription rights or
otherwise until the Class B Warrants evidenced by this Warrant Certificate
shall have been exercised and the Common Stock purchasable upon the exercise
thereof shall have become deliverable as provided in the Warrant Agreement.

             If this Warrant Certificate shall be surrendered for exercise
within any period during which the transfer books for the Company's Common
Stock or other class of stock purchasable upon the exercise of the Class B
Warrants evidenced by this Warrant Certificate are closed for any purpose, the
Company shall not be required to make delivery of certificates for shares
purchasable upon such transfer until the date of the reopening of said transfer
books.

             Every holder of this Warrant Certificate by accepting the same
consents and agrees with the Company, the Warrant Agent, and with every other
holder of a Warrant Certificate that:

    (a) this Warrant Certificate is transferable on the registry books of the
Warrant Agent only upon the terms and conditions set forth in the Warrant
Agreement, and

    (b) the Company and the Warrant Agent may deem and treat the person in
whose name this Warrant Certificate is registered as the absolute owner hereof
(notwithstanding any notation of ownership or other writing thereon made by
anyone other than the Company or the Warrant Agent) for all purposes whatever
and neither the Company nor the Warrant Agent shall be affected by any notice
to the contrary.

             The Company shall not be required to issue or deliver any
certificate for shares of Common Stock or other securities upon the exercise of
Class B Warrants evidenced by this Warrant Certificate until any tax which may
be payable in respect thereof by the holder of this Warrant Certificate
pursuant to the Warrant Agreement shall have been paid, such tax being payable
by the holder of this Warrant Certificate at the time of surrender.

             This Warrant Certificate shall not be valid or obligatory for any
purpose until it shall have been countersigned by the Warrant Agent.

                                        v
<PAGE>

             WITNESS the facsimile signatures of the proper officers of the
Company and its corporate seal.

Dated:
                                           GMX Resources  Inc.

                                           By:
                                              -----------------------------
                                           Chief Executive Officer

                                           Attest:
                                                  -----------------------------
                                           Secretary

Countersigned

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

By:
   ----------------------------
   Authorized Officer

                                      vi

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