Document:

exv10w3

Exhibit 10.3

AMENDED AND RESTATED EMPLOYMENT AGREEMENT

     THIS AMENDED AND RESTATED EMPLOYMENT AGREEMENT (this “Agreement”) is made effective as of the
6th day of August, 2009 (the “Effective Date”) by and between BEAZER HOMES USA, INC., a Delaware
corporation (the “Company”), and MICHAEL H. FURLOW, an individual resident of the State of Georgia
(“Executive”).

WITNESSETH:

     WHEREAS, the Company and Executive have heretofore entered into an Employment Agreement dated
September 1, 2004, as amended (the “Existing Agreement”); and

     WHEREAS, the Company and Executive desire to amend certain provisions of, and to restate in
its entirety the Existing Agreement as provided herein.

     NOW, THEREFORE, in consideration of the premises and of the mutual covenants and agreements
herein contained, the Company and Executive hereby agree as follows:

1. Employment and Duties.

     (a) The Company hereby agrees to employ Executive for the Term (as hereinafter defined) as its
Division President-Charleston/Myrtle Beach/Savannah. The parties agree that effective on the date
hereof Executive shall resign his position as Executive Vice President and Chief Operating Officer
of the Company and any other positions he has with the Company’s subsidiaries and affiliates. If
requested by the Board of Directors of the Company (the “Board”), Executive shall also serve on the
Board without additional compensation, if requested. Executive shall also serve, if requested by
the Board, as an executive officer and/or director of any subsidiaries and/or affiliated companies
and shall comply with the policy of the Compensation Committee of the Board (the “Compensation
Committee”) with regard to retention or forfeiture of any director’s fees. As used in this
Agreement, the term “affiliated companies” shall include any company controlled by, controlling or
under common control with the Company.

     (b) The Executive shall have such management and oversight responsibilities and authority as
are necessary to efficiently administer the affairs of the Division and as are customary of an
Division President. All powers herein granted to the Executive are subject to supervisory approval
of the President and Chief Executive Officer of the Company (the “CEO”), and the Executive may be
given such further reasonably related supervisory duties, powers and prerogatives as may be
delegated to him from time to time by said CEO. The Executive shall report exclusively to the CEO
and further shall render such advice to the CEO as said CEO may from time to time request.

     (c) During the Term, and excluding any periods of vacation and sick leave to which the
Executive is entitled, Executive shall devote substantially all of his business time and efforts to
the business and affairs of the Company and, to the extent necessary to discharge the
responsibilities assigned to the Executive hereunder, use the Executive’s reasonable best efforts
to perform faithfully such responsibilities. In performing such duties hereunder, Executive shall
comply with the policies and procedures as adopted from time to time by the Board, shall give the
Company the benefit of his special knowledge, skills, contacts and business experience, shall
perform his duties and carry out his responsibilities hereunder in a diligent manner.

     (d) During the Employment Term, it shall not be a violation of this Agreement for the
Executive to (i) with the prior approval of the CEO in each case, serve on corporate, civic or
charitable boards or committees, (ii) with the prior approval of the Board in each case, deliver
lectures, fulfill speaking engagements or teach at educational institutions, and (iii) manage
personal investments, so long as such activities do not significantly interfere or constitute a

 

 

conflict of interest with the performance of the Executive’s responsibilities as an employee of the
Company in accordance with this Agreement.

     (e) The principal location for performance of Executive’s services hereunder shall be at the
offices of Beazer Homes USA, Inc. in Charleston, South Carolina, subject to reasonable travel
requirements during the course of such performance. Executive shall not be required, without his
consent, to regularly report to any office of the Company which is located more than thirty-five
(35) miles from the Division’s current office location set forth above, provided Executive will be
expected to travel to the extent reasonably necessary to fulfill his responsibilities.

2. Employment Term. The term of Executive’s employment hereunder (the “Term”) shall
commence effective as of the date hereof and shall end on the second anniversary thereof (the
“Expiration Date”), unless sooner terminated as provided herein.

3. Compensation and Benefits

     (a) Base Salary. During the first year of the Term, the Executive shall receive an
annual base salary (“Annual Base Salary”) in the amount of $569,800.00 and in the second year of
the Term an Annual Base Salary in the amount of $800,000.00, payable in accordance with the
Company’s normal payroll practices (but not less frequently than monthly). During the Term, the
Annual Base Salary shall be reviewed by the CEO (for purposes of increase only) at least annually.
Any increase in Annual Base Salary shall not serve to limit or reduce any other obligation to the
Executive under this Agreement. Annual Base Salary shall not be reduced after any such increase and
the term Annual Base Salary as utilized in this Agreement shall refer to Annual Base Salary as so
increased. Notwithstanding anything contained herein to the contrary, in the event that the Company
shall implement a Company-wide reduction in executive base compensation, then, solely for such
purpose and only during the continuation of such Company-wide reduction, the Company shall have the
right to reduce the Annual Base Salary then payable hereunder in a manner that is consistent with
said Company-wide reduction.

     (b) Bonuses; Stock Incentive Plans. Executive will be eligible to and shall
participate in the Company’s bonus and stock incentive plans at the discretion of the Compensation
Committee of the Board. The amount and terms of, and the targets, conditions and restrictions
applicable to each bonus or other incentive award shall be subject to the provisions of any such
plan and of the applicable award letter duly executed and delivered by the Company.

     (c) Incentive, Savings and Retirement Plans. During the Term, the Executive shall be
entitled to participate in all incentive, savings and retirement plans, practices, policies and
programs applicable generally to other Division Presidents of the Company and its affiliated
companies.

     (d) Welfare Benefit Plans. During the Term, 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, medical, prescription, dental, disability,
employee life, group life, accidental death and travel accident insurance plans and programs) to
the extent applicable generally to other Division Presidents of the Company and its affiliated
companies.

     (e) Expenses. The Company will pay or reimburse Executive for all reasonable and
necessary out-of-pocket expenses incurred by him in the performance of his duties under this
Agreement. Executive shall keep detailed and accurate records of expenses incurred in connection
with the performance of his duties hereunder and reimbursement therefore shall be in accordance
with policies and procedures to be established from time to time by the Board.

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     (f) Office and Support Staff. During the Term, the Executive shall be entitled to an
office or offices of a size and with furnishings and other appointments, and to secretarial and
other assistance, consistent with the Executive’s position and title.

     (g) Vacation. During the Term, Executive shall be entitled to twenty (20) working
days of compensated vacation in each fiscal year, to be taken at times which do not unreasonably
interfere with the performance of Executive’s duties hereunder. Any unused vacation time from any
fiscal year shall be subject to accumulation or forfeiture in accordance with Company policy as in
effect from time to time.

     (h) Company Automobile. Executive currently has use of a Company leased automobile.
He may continue use of such car until the Expiration Date, provided however, if during the Term he
so elects, he shall be provided with a Company leased automobile generally of the same type and
cost as other Division Presidents.

4. Termination of Employment.

     (a) Death or Disability. The Executive’s employment shall terminate automatically upon
the Executive’s death during the Term. If the Disability of the Executive occurs during the Term
(pursuant to the definition of Disability set forth below), the Company may give to the Executive
written notice in accordance with Section 9(c) 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 this Agreement, “Disability”
shall mean the absence of the Executive from the Executive’s duties with the Company on a full-time
basis for 120 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 for Cause. For
purposes of this Agreement, “Cause” shall mean:

	 	(i)	 	any act or failure to act by Executive done with the intent
to harm in any material respect the financial interests or reputation of the
Company or any affiliated companies;
	 
	 	(ii)	 	Executive being convicted of (or entering a plea of guilty or
nolo contendere to) a felony (other than a felony involving a motor vehicle);
	 
	 	(iii)	 	Executive’s dishonesty, misappropriation or fraud with
regard to the Company or any affiliated companies (other than good faith
expense account disputes);
	 
	 	(iv)	 	a grossly negligent act or failure to act by Executive which
has a material adverse affect on the Company or any affiliated companies;
	 
	 	(v)	 	the material breach by Executive of his agreements or
obligations under this Agreement which has a material adverse effect on the
Company, which breach, if curable, is not cured by Executive within fifteen
(15) days after written notice from the Company which specifically identifies
the material breach which the Company believes that Executive has committed;
or

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	 	(vi)	 	the continued refusal to follow the directives of the CEO or
the Board or their designees which are consistent with Executive’s duties and
responsibilities identified in Section 1 hereof; provided that the foregoing
refusal shall not be “cause” if Executive in good faith believes that such
direction is illegal, unethical or immoral and promptly so notifies the CEO or
Board, as the case may be, in writing.

     (c) Notice of Termination. Any termination by the Company for Cause shall be
communicated by Notice of Termination to the Executive given in accordance with Section 9(c) of
this 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 Company to set forth in the Notice of Termination any fact or
circumstance which contributes to a showing of Cause shall not waive any right of the Company
hereunder or preclude the Company from asserting such fact or circumstance in enforcing the
Company’s rights hereunder.

     (d) Date of Termination. “Date of Termination” means (i) if the Executive’s employment
is terminated by the Company for Cause, the date of receipt of the Notice of Termination or,
subject to applicable cure periods, 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.

5. Obligations of the Company upon Termination.

     (a) Other Than for Cause. If, during the Term, the Company shall terminate the
Executive’s employment other than for Cause:

	 	(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: (1) the Executive’s Annual Base Salary through the Date of
Termination to the extent not theretofore paid, (2) any accrued but unpaid
annual bonus (“Annual Bonus”) respecting any completed fiscal year ending
prior to the Date of Termination, (3) the product of (x) the Average Annual
Bonus (hereinafter defined) 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 (4) 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), (3) and (4) shall be
hereinafter referred to as the “Accrued Obligations”).
	 
	 	 	 	The term “Average Annual Bonus” shall mean the arithmetic average of the
Executive’s bonuses (whether paid or deferred) under the Company’s annual
incentive plans during the last three full fiscal years prior to the Date
of Termination or for such lesser period as the Executive has been
employed by the Company (annualized in the event that the Executive was
not employed by the Company for the whole of any such fiscal year).
Without limiting the generality of the foregoing definition, the

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	 	 	 	“Average
Annual Bonus” shall include the following components, if any, pursuant to
the Company’s Amended and Restated VCIP Rules (or any successor incentive
plan, for so long as any of same shall exist):

	 	(a)	 	Cash payouts from VC and
IVC awards and the “Bank” payout, subject to the Payout Cap,
all at full face value;
	 
	 	(b)	 	Any excess in the Bank
discounted at 75% of face value (which shall, for purposes
hereof, be deemed to be fully vested);
	 
	 	(c)	 	10% of the Bank contributed
to the Deferred Compensation Plan, at full face value (which
shall, for purposes hereof, be deemed to be fully vested);
and
	 
	 	(d)	 	Any deferred bonus under
the VCIP which is invested in stock under the Company’s
Corporate Management Stock Purchase Program, at full face
value of said bonus (which shall, for purposes hereof, be
deemed to be fully vested);

	 	(ii)	 	so long as the Executive is and remains in compliance in all
material respects with his obligations under Section 6 below, the Company
shall pay to the Executive an amount equal to the sum of (1) Executive’s
Annual Base Salary (at the rate in effect on the Date of Termination), and (2)
the Average Annual Bonus for a period of two years from the Date of
Termination, (the “Severance Period”), at the same time that payments of
Annual Base Salary and Annual Bonus would otherwise have become due and
payable during said period in the absence of such termination;
	 
	 	(iii)	 	so long as the Executive is and remains in compliance in all
material respects with his obligations under Section 6 below, during the
Severance Period, 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 3(d) of this Agreement
if the Executive’s employment had not been terminated, provided, however, that
if the Executive becomes reemployed with another employer and receives medical
or other welfare benefits under another employer provided plan, the medical
and other welfare benefits described herein shall cease; 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 (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, 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.

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     (c) Disability. If the Executive’s employment is terminated by reason of the
Executive’s Disability, 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 or the Executive’s legal
representative in a lump sum in cash within 30 days of the Date of Termination.

     (d) Cause. If the Executive’s employment shall be terminated for Cause, this Agreement
shall terminate without further obligations to the Executive other than the obligation to pay to
the Executive (x) his Annual 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 Term, 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.

     (e) Payment of Deferred Compensation. Notwithstanding anything to the contrary
contained in this Section 5 and subject to Section 10 hereof, the timing of payments by the Company
of any deferred compensation which is part of the Accrued Obligations shall remain subject to the
terms and conditions of the applicable deferred compensation plan, and any payment election
previously made by the Executive.

6. Employment Covenants.

     (a) Covenant Not to Compete. Executive recognizes and acknowledges that the Company is
placing its confidence and trust in Executive. Executive, therefore, covenants and agrees that
during the Applicable Non-Compete Period (as defined below) Executive shall not, either directly or
indirectly, without the prior written consent of the Board (which may be withheld in the sole and
absolute discretion of the Board):

(i) Engage in or carry on any business or in any way become associated with any
business in the Restricted Area (as hereinafter defined) which is similar to or is
in competition with the Business of the Company (as hereinafter defined). As used
in this Section 6(a), the term (1) “Business of the Company” shall mean and include
all business activities in which the Company and/or any affiliated companies have
engaged (or have prepared written plans to engage) at any time during the Term,
including but not limited to, the purchase of land (or options therefor) for
development and the construction of residential homes for resale to consumers, and
(2) “Restricted Area” shall mean and include anywhere in the United States of
America or in any foreign country in which the Company or any affiliated companies
then engage (or have within the preceding three years engaged) in business.

(ii) in connection with any business which is similar to or is in competition with
the Business of the Company in the Restricted Area, solicit the business of any
person or entity, on behalf of himself or any other person or entity, which is or
has been at any time during the Term a customer or supplier of the Company
including, but not limited to, former or present customers or suppliers with whom
Executive has had personal contact during, or by reason of, his relationship with
the Company;

(iii) Be or become an employee, agent, consultant, representative, director or
officer of, or be otherwise in any manner associated with, any person, firm,
corporation, association or other entity which is engaged in or is carrying on any
business which is similar to or in competition with the Business of the Company in
the Restricted Area;

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(iv) Solicit for employment or employ any person employed by the Company at any
time during the twelve (12) month period immediately preceding such solicitation or
employment; or

“(v) Be or become a shareholder, joint venturer, owner (in whole or in part), or
partner, or be or become associated with or have any proprietary or financial
interest in or of any firm, corporation, association or other entity which is
engaged in or is carrying on any business which is similar to or in competition
with the Business of the Company in the Restricted Area (a “Competing Entity”).
Notwithstanding the preceding sentence, (A) passive equity investments by Executive
of $100,000 or less in any Competing Entity, or (B) investments, in any amount, in
any publicly traded mutual fund, index fund or similar investment vehicle which
fund or investment vehicle owns any proprietary or financial interest in any
Competing Entity, shall not be deemed to violate this Section 6(a)(v).”

     Executive further warrants and represents that, because of his varied skill and abilities, he
does not need to compete with the Business of the Company and that this Agreement will not prevent
him from earning a livelihood and acknowledges that the restrictions contained in this Section 6
constitute reasonable protections for the Company.

     As used in this Section 6, “Applicable Non-Compete Period” shall mean the following:

	 	(A)	 	at all times that the Executive is employed by the Company;
and
	 
	 	(B)	 	for a period of time after the Executive’s employment under
this Agreement is terminated for any reason equal to the greater of

	 	(i)	 	180 days; or
	 
	 	(ii)	 	such longer period of time that the Executive is entitled to
receive payments under Sections 5(a)(ii) or (iii) above.

     (b) Confidential Information. Executive agrees that all Confidential Information shall
be the sole property of the Company, and Executive agrees that he shall not during the Term nor
thereafter, use for his benefit or the benefit of others or disclose at any time Confidential
Information or take with him upon termination of this Agreement any records, papers, reports,
lists, computer tapes or disks or any other materials of any nature that contain any Confidential
Information. “Confidential Information” shall mean all information other than General Knowledge
(defined below) relating to the Company’s: (i) business or existing projects including all those in
various stages of research and development including all unpublished plans for new products or
services; (ii) financial information, internal business procedures and other information which
relate to the way the Company conducts its business and which are not publicly available; (iii)
data written by the Company’s employees or others, including source codes, object codes, marketing
and development plans, budgets, forecasts, forecast assumptions and future plans and potential
strategies of the Company which have been or are being discussed; (iv) unpublished pricing data;
(v) identity, buying habits and practices of the Company, its suppliers and customers to the extent
not publicly available; (vi) information regarding the skills or compensation of employees of the
Company; (vii) the Intellectual Property of the Company and any information pertaining thereto;
(viii) materials and information supplied by customers or clients to the Company that contain data
regarding any research, products, procedures or the like; and (ix) any other information deemed
confidential by the Company by marking such information with the word “Confidential” or similar
word; by orally advising the Executive that the information is confidential or by treating the
information in such a manner that the Executive should reasonably believe it to be deemed
confidential by the Company. “General Knowledge” shall mean (i) general skills or experience

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gained during Executive’s employment with, consultation for or work for the Company; and (ii)
information and data publicly available.

     (c) Records. All files, records, memoranda and other documents regarding former,
existing or prospective customers of the Company or relating in any manner whatsoever to
Confidential Information or the Business of the Company (collectively, “Records”), whether prepared
by Executive or otherwise coming into his possession, shall be the exclusive property of the
Company. All Records shall be immediately placed in the physical possession of the Company upon the
termination of Executive’s employment with the Company, or at any other time specified by the
Board. The retention and use by Executive of duplicates in any form of Records is prohibited after
the termination of Executive’s employment with the Company.

     (d) Breach. Executive hereby recognizes and acknowledges that irreparable injury or
damage shall result to the Company in the event of a breach or threatened breach by Executive of
any of the terms or provisions of this Section 6, and Executive therefore agrees that the Company
shall be entitled to an injunction restraining Executive from engaging in any activity constituting
such breach or threatened breach. Nothing contained herein shall be construed as prohibiting the
Company from pursuing any other remedies available to the Company at law or in equity for such
breach or threatened breach, including but not limited to, the recovery of damages from Executive
and, if Executive is an employee of the Company, the termination of his employment with the Company
in accordance with the terms and provisions of this Agreement.

     (e) Survival. Notwithstanding the termination of the employment of Executive or the
termination of this Agreement, the provisions of this Section 6 shall survive and be binding upon
Executive unless a written agreement which specifically refers to the termination of the
obligations and covenants of this Section 6 is executed by the Company. Notwithstanding the
foregoing, this Section 6 shall not survive the termination of this Agreement as the result of the
Change Of Control Agreement (hereinafter defined) becoming effective.

     (f) Blue-Penciling. Should any court or other legally constituted authority determine
that for any such agreement or covenant to be effective it must be modified to limit its duration
or scope, the parties hereto shall consider such agreement or covenant to be amended or modified
with respect to duration and/or scope so as to comply with the orders of any such court or other
legally constituted authority, and as to all other portions of such agreement or covenants they
shall remain in full force and effect as originally written.

7. No Mitigation. 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 (i) the Company, provided that the Executive prevails in at least one material issue,
(ii) the Executive or (iii) others, of the validity or enforceability of, or liability under, any
provision of this Agreement or any guarantee of performance thereof (including, without limitation,
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”).

8. Successors.

     (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.

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     (b) This Agreement shall inure to the benefit of and be binding upon the Company and its
successors and assigns.

9. Miscellaneous.

     (a) This Agreement shall be governed by and construed in accordance with the laws of the State
of Delaware, without reference to principles of conflict of laws. Any legal action, suit or
proceeding arising out of or relating to this Agreement shall be instituted in the state or federal
courts in the State of Delaware and the parties agree not to assert, in any action, suit or
proceeding by way of motion, as a defense or otherwise, any claim that either party is not
personally subject to the jurisdiction of such court, or that such action, suit or proceeding is
brought in an inconvenient forum, or that the venue is improper or that the subject matter hereof
cannot be enforced in such court. The parties hereby irrevocably submit to the jurisdiction of any
such court in any such action, suit or proceeding and agree that service of all process in any such
action, suit or proceeding in any such court may be made by registered or certified mail, return
receipt requested, to its address set forth in this Agreement, such service being hereby
acknowledged by such party to be sufficient for personal jurisdiction in any action against such
party in any such court and to be otherwise effective and binding service in every respect.

     (b) The captions of this Agreement are not part of the provisions hereof and shall have no
force or effect. This Agreement may not be amended or modified otherwise than by a written
agreement executed by the parties hereto or their respective successors and legal representatives.

     (c) All notices and other communications hereunder shall be in writing and shall be given by
hand delivery to the other party, by FedEx or other commercial overnight courier or by registered
or certified mail, return receipt requested, postage prepaid, addressed as follows:

If to the Executive:

P.O. Box 422175, Atlanta, GA 30342

If to the Company:

1000 Abernathy Road

Suite 1200

Atlanta, Georgia 30328

Attention: Company Secretary

or to such other address as either party shall have furnished to the other in writing in accordance
herewith. Notice and communications shall be effective when actually received by the addressee.

     (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 Company’s failure to insist upon strict compliance with any provision of this
Agreement or the failure to assert any right the Company may have hereunder shall not be deemed to
be a waiver of such provision or right or any other provision or right of this Agreement.

     (g) This Agreement supersedes any and all other prior or contemporaneous agreements, either
oral or in writing, between the parties hereto with respect to the subject matter hereof including,
without limitation, the Existing Agreement, and this Agreement contains all of the

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covenants and
agreements between the parties with respect to employment of Executive by the Company,
provided, however, that nothing contained herein shall impair Executive’s right to
(i) any salary, bonus or other payments accrued through the effective date hereof and owing to
Executive pursuant to the Existing Agreement or (ii) any award of restricted stock and grants of
options to acquire shares of the Company’s common stock referred to in the Existing Agreement and
the award letters delivered by the Company to Executive in connection therewith.

     Reference is hereby made to that certain Employment Agreement dated as of February 3, 2006, as
amended (the “Change Of Control Agreement”) by and between the Company and the Executive.
Notwithstanding anything contained herein to the contrary, (i) this Agreement shall not supersede
the Change of Control Agreement, and (ii) upon the “Effective Date” occurring under the Change of
Control Agreement, this Agreement shall be superseded by the Change of Control Agreement.

     (h) This Agreement may be executed via facsimile transmission signature and in counterparts,
each of which shall be deemed to be an original but all of which together will constitute one and
the same instrument.

10. Special Provision Regarding Section 409A of the Internal Revenue Code.

     This Agreement is intended to comply with Section 409A of the Internal Revenue Code of 1986,
as amended (the “Code”) and will be interpreted in a manner intended to comply with Section 409A of
the Code. Notwithstanding anything herein to the contrary, in the event any payments or benefits
required to be provided hereunder are deemed to constitute payments of “nonqualified deferred
compensation” that is subject to the requirements of Section 409A of the Code, then the time and
manner in which such payment or benefit is provided shall be adjusted, to the extent reasonably
possible, so that payment or distribution is made at a time and in a manner that is consistent with
the requirements of such Section 409A (and applicable proposed or final Treasury regulations or
other guidance issued or to be issued by the Internal Revenue Service). This Section 10 may, for
example, require that certain payments to Executive following his termination of employment be
delayed until the date that is six (6) months after the date of his separation from service with
the Company (the “Delay Period”) if, at the time of Executive’s termination of employment with the
Company, Executive is a “specified employee” (as that term is used for purposes of Section
409A(2)(B)(i)). Upon the expiration of the Delay Period, all payments and benefits delayed
pursuant to this Section 10 (whether they would have otherwise been payable in a single sum or in
installments in the absence of such delay) shall be paid or reimbursed to the Executive in a lump
sum, and any remaining payments and benefits due under this Agreement shall be paid or provided in
accordance with the normal payment dates specified for them herein.

     To the extent any reimbursements or in-kind benefits due to Executive under this Agreement
constitutes “deferred compensation” under Section 409A of the Code, any such reimbursements or
in-kind benefits shall be paid to Executive in a manner consistent with Treas. Reg. Section
1.409A-3(i)(1)(iv). Each payment made under this Agreement shall be designated as a “separate
payment” within the meaning of Section 409A of the Code. The Executive shall be deemed to have a
“termination of employment” under this Agreement for purposes of entitling him to any “nonqualified
deferred compensation” that is subject to the requirements of Section 409A only to the extent the
Executive has a “separation from service,” as that term is defined in Section 409A and the
applicable Treasury regulations applying all of the default rules thereunder. The Company shall
consult with Executive in good faith regarding the implementation of the provisions of this Section
10.

10

 

     IN WITNESS WHEREOF, the parties hereto have executed this AMENDED AND RESTATED EMPLOYMENT
AGREEMENT effective as of the date first written above.

	 	 	 	 	 
	 	BEAZER HOMES USA, INC.

 	 
	 	By:  	/s/ Ian J. McCarthy
 	 
	 	Name:  	Ian J. McCarthy 	 
	 	Title:  	President and Chief Executive Officer 	 
	 
	 	EXECUTIVE

 	 
	 	/s/ Michael H. Furlow
 	 
	 	MICHAEL H. FURLOW 	 
	 	 	 
	 

11exv10w4

Exhibit 10.4

SUPPLEMENTAL EMPLOYMENT AGREEMENT

     AGREEMENT by and between Beazer Homes USA, Inc., a Delaware corporation (the “Company”) and
MICHAEL H. FURLOW (the “Executive”), dated as of the 6th day of August, 2009.

     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 in 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 the second anniversary of the date hereof.

     2. Change of Control. For the purpose of this Agreement, a “Change of Control” shall
mean:

     (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
25% or more of either (i) the then outstanding shares of common stock of the Company (the
“Outstanding Company Common Stock”) or (ii) 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: (i) any acquisition
directly from the Company, (ii) any acquisition by the Company, (iii) any acquisition by any
employee benefit plan (or related trust) sponsored or maintained by the Company or any corporation
controlled by the Company or (iv) 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 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.
	 
	 	(e)	 	Notwithstanding the foregoing, a Change of Control shall not be
deemed to have occurred unless it is also a “change in control event” as
described in Treasury Reg. Section 1.409A-3(i)(5) of the Internal Revenue
Code of 1986, as amended (the “Code”).

     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 the date hereof (the “Employment Period”).

     4. Terms of Employment.

     (a) Position and Duties.

(i) During the 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 from the date hereof to the Effective Date
and (B) the Executive’s services shall be performed at Charleston, South Carolina
or any office or location less than 35 miles from such location.

(ii) During the Employment Period, and excluding any periods of vacation and sick
leave to which the Executive is entitled, the Executive agrees to devote

2

 

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 such responsibilities. During the
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.

     (b) Compensation.

(i) Base Salary. During the Employment Period, the Executive shall receive
an annual base salary (“Annual 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.
Annual Base Salary shall be payable in accordance with the Company’s normal payroll
practices (but not less frequently than monthly). During the Employment Period, the
Annual Base Salary shall be reviewed (for purposes of increase only) 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 Annual Base Salary
shall not serve to limit or reduce any other obligation to the Executive under this
Agreement. Annual Base Salary shall not be reduced after any such increase and the
term Annual Base Salary as utilized in this Agreement shall refer to Annual 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 Annual Base Salary, the Executive shall
be awarded, for each fiscal year ending during the Employment Period, an annual
bonus (the “Annual Bonus”) in cash at least equal to the arithmetic average of the
Executive’s bonuses (whether paid or deferred) under the Company’s or its
predecessor’s annual incentive plans during the last three full fiscal years prior
to the Effective Date or for such lesser period as the Executive has been employed
by the Company or its predecessor (annualized in the event that the Executive was
not employed by the Company for the whole of any such fiscal year), (the “Average
Annual Bonus”). Each such Annual 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 Annual
Bonus is awarded, unless the Executive shall elect to defer the receipt of such
Annual Bonus. Without limiting the generality of the foregoing definition, the
“Average Annual Bonus” shall include the following components, if any, pursuant to
the Company’s Amended and Restated EVCIP Rules (or any successor incentive plan,
for so long as any of same shall exist):

	 	(a)	 	Cash payouts from VC and IVC awards and the
“Bank” payout, subject to the Payout Cap, all at full face value;

3

 

	 	(b)	 	Any excess in the Bank discounted at 75% of
face value (which shall, for purposes hereof, be deemed to be fully
vested);
	 
	 	(c)	 	10% of the Bank contributed to the Deferred
Compensation Plan, at full face value (which shall, for purposes
hereof, be deemed to be fully vested); and

(d) Any deferred bonus under the EVCIP which is invested in stock under
the Company’s Corporate Management Stock Purchase Program, at full face
value of said bonus (which shall, for purposes hereof, be deemed to be
fully vested);

(iii) Incentive, Savings and Retirement Plans. During the Employment
Period, the Executive shall be entitled to participate in all incentive, savings
and retirement plans, practices, policies and programs applicable generally to
other most senior 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 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 from the date hereof
until the Effective Date or if more favorable to the Executive, those provided
generally at any time after the Effective Date to other peer executives of the
Company and its affiliated companies.

(iv) Welfare Benefit Plans. During the 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, medical, prescription, dental,
disability, employee life, group life, accidental death and travel accident
insurance plans and programs) to the extent applicable generally to other most
senior 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 from the date hereof until the Effective Date or, if more favorable to the
Executive, those provided generally at any time after the Effective Date to other
peer executives of the Company and its affiliated companies.

(v) Expenses. During the 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
from the date hereof until the Effective Date or, if more favorable to the
Executive, as in effect generally at any time thereafter with respect to other peer
executives of the Company and its affiliated companies.

(vi) Fringe Benefits. During the 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 from the date hereof until the Effective Date

4

 

or, if more favorable to the Executive, as in effect generally at any time
thereafter with respect to other peer executives of the Company and its affiliated
companies.

(vii) Office and Support Staff. During the 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 from the date hereof until the
Effective Date or, if more favorable to the Executive, as provided generally at any
time thereafter with respect to other peer executives of the Company and its
affiliated companies.

(viii) Vacation. During the Employment Period, the Executive shall be
entitled to paid vacation in accordance with the most favorable plans, policies,
programs and practices of the Company and its affiliated companies as in effect for
the Executive at any time from the date hereof until the Effective Date or, if more
favorable to the Executive, as in effect generally at any time thereafter with
respect to other peer executives of the Company and its affiliated companies.

     5. Termination of Employment.

     (a) Death or Disability. The Executive’s employment shall terminate automatically upon
the Executive’s death during the Employment Period. If the Disability of the Executive occurs
during the Employment Period (pursuant to the definition of Disability set forth below), the
Company may give to the Executive written notice in accordance with Section 13(c) 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 this 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 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), for more than
15 days 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.

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 interests 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 President and Chief Executive Officer of the

5

 

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 than 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 specifying 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 within 15 days 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 within 15
days 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, which is not remedied by the
Company within 15 days after receipt of notice thereof given by the Executive;

(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, which is not remedied by the Company within 15 days after receipt of
notice thereof given by the Executive.

Anything in this Agreement to the contrary notwithstanding, a termination by the Executive for any
reason during the 30 day period immediately following the six (6) month anniversary of the
Effective Date shall be deemed to be a termination for Good Reason for all purposes of this
Agreement. A termination pursuant to the immediately preceding sentence is sometimes hereinafter
referred to as a “Permitted Executive Termination”.

     (d) Notice of Termination. Any termination of the Executive’s employment by the
Company or by the Executive shall be communicated by Notice of Termination to the other party
hereto given in accordance with Section 13(c) of this 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

6

 

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, subject to applicable cure periods, 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. If, during the Employment Period, the Company
shall terminate the Executive’s employment other than for Cause or the Executive shall terminate
employment for Good Reason (including, without limitation, a Permitted Executive Termination):

(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 Annual Base Salary through the Date of
Termination to the extent not theretofore paid, (2) any accrued but unpaid Annual
Bonus respecting any completed fiscal year ending prior to the Date of Termination,
(3) the product of (x) the Average 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 (4) 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), (3) and (4)
shall be hereinafter referred to as the “Accrued Obligations”). Anything contained
herein to the contrary notwithstanding, the timing of payment by the Company of any
deferred compensation shall remain subject to the terms and conditions of the
applicable deferred compensation plan and any payment election previously made by
the Executive; provided, however, that, if at the time of
Termination, Executive is a “specified employee” within the meaning of Section 409A
of the Internal Revenue Code, as amended, then payments shall not be made before
the date which is six (6) months after the date of separation from service with the
Company (or, if earlier, the date of the Executive’s death); and

     B. the amount equal to the product of (1) two (2), and (2) the sum of (x) the
Executive’s Annual Base Salary and (y) the Highest Annual Bonus (as hereinafter
defined); and

(ii) for two (2) 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

7

 

terminated or, if more favorable to the Executive, as in effect generally at any
time thereafter with respect to other peer 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 two (2)
years after the Date of Termination and to have retired on the last day of such
period;

(iii) the Company shall, at its sole expense as incurred, provide the Executive
with outplacement services in accordance with the Company’s policies with regard to
outplacement then in effect; 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 (such other amounts and benefits shall be hereinafter referred to as the
“Other Benefits”).

     For purposes hereof, the term “Highest Annual Bonus” shall mean the highest of the Executive’s
bonuses (whether paid or deferred) under the Company’s or its predecessor’s annual incentive plans
during the last three full fiscal years prior to the Effective Date or for such lesser period as
the Executive has been employed by the Company or its predecessor (annualized in the event that the
Executive was not employed by the Company for the whole of any such fiscal year).

     (b) Death. If the Executive’s employment is terminated by reason of the Executive’s
death during the 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 the most senior executives of the Company and such affiliated companies under such
plans, programs, practices and policies relating to death benefits, if any, as in effect with
respect to other most senior executives and their beneficiaries at any time from the date hereof
until 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 most senior
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 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 or the
Executive’s legal representative 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, 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

8

 

accordance with such plans, programs, practices and policies relating to disability, if any, as in
effect generally with respect to other peer executives and their families at any time from the date
hereof until the Effective Date or, if more favorable to the Executive and/or the Executive’s
family, as in effect at any time thereafter generally with respect to other peer 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 Employment Period, this Agreement shall terminate without further
obligations to the Executive other than the obligation to pay to the Executive (x) his Annual 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 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 13(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 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. Each and every payment made hereunder by the Company shall be
final, and the Company shall not seek to recover all or any part of such payment from the Executive
or from whomsoever may be entitled thereto, for any reasons whatsoever. 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 (i) the Company, provided that the
Executive prevails in at least one material issue, (ii) the Executive or (iii) others, of the
validity or enforceability of, or liability under, any provision of this Agreement or any guarantee
of performance thereof (including, without limitation, 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”).

     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

9

 

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 and 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 such certified public accounting firm as may be designated by the Company (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 Company 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 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

10

 

(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 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.

     (e) Any Gross-Up Payment required under this Section 9 will be made by the end of the
Executive’s taxable year next following the Executive’s taxable year in which the Executive remits
the related taxes. In addition, any right to the reimbursement of expenses incurred due to a tax
audit or litigation addressing the existence or amount of a tax liability will be made by the end
of the Executive’s taxable year following the Executive’s taxable year in which the taxes that are
the subject of the audit or litigation are remitted to the taxing authority, or where as a result
of such audit or litigation no taxes are remitted, the end of the Executive’s taxable year
following the Executive’s taxable year in which the audit is completed or there is a final and
nonappealable settlement or other resolution of the litigation.

     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

11

 

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.

     (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) 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. Covenant Not to Compete. In the event of a Permitted Executive Termination,
Executive covenants and agrees that during the Non-Compete Period (as defined below) Executive
shall not, either directly or indirectly, without the prior written consent of the Board (which may
be withheld in the sole and absolute discretion of the Board):

(i) Engage in or carry on any business or in any way become associated with any
business in the Restricted Area (as hereinafter defined) which is similar to or is
in competition with the Business of the Company (as hereinafter defined). As used
in this Section 12, the term (1) “Business of the Company” shall mean and include
all business activities in which the Company and/or any affiliated companies have
engaged (or have prepared written plans to engage) at any time during the Term,
including but not limited to, the purchase of land (or options therefor) for
development and the construction of residential homes for resale to consumers, and
(2) “Restricted Area” shall mean and include anywhere in the United States of
America or in any foreign country in which the Company or any affiliated companies
then engage (or have within the preceding three years engaged) in business;

(ii) in connection with any business which is similar to or is in competition with
the Business of the Company in the Restricted Area, solicit the business of any
person or entity, on behalf of himself or any other person or entity, which is or
has been at any time during the Term a customer or supplier of the Company
including, but not limited to, former or present customers or suppliers with whom
Executive has had personal contact during, or by reason of, his relationship with
the Company;

(iii) Be or become an employee, agent, consultant, representative, director or
officer of, or be otherwise in any manner associated with, any person, firm,
corporation, association or other entity which is engaged in or is carrying on any
business which is similar to or in competition with the Business of the Company in
the Restricted Area;

12

 

(iv) Solicit for employment or employ any person employed by the Company at any
time during the twelve (12) month period immediately preceding such solicitation or
employment; or

(v) Be or become a shareholder, joint venturer, owner (in whole or in part), or
partner, or be or become associated with or have any proprietary or financial
interest in or of any firm, corporation, association or other entity which is
engaged in or is carrying on any business which is similar to or in competition
with the Business of the Company in the Restricted Area (a “Competing Entity”).
Notwithstanding the preceding sentence, (A) passive equity investments by Executive
of $100,000 or less in any Competing Entity, or (B) investments, in any amount, in
any publicly traded mutual fund, index fund or similar investment vehicle which
fund or investment vehicle owns any proprietary or financial interest in any
Competing Entity, shall not be deemed to violate this Section 12(v).

     For purposes of identifying the Restricted Area, Executive hereby recognizes and acknowledges
that the existing Business of the Company currently extends throughout the States of Georgia,
Tennessee, South Carolina, North Carolina, California, Arizona, Nevada, Florida, New Jersey,
Delaware, Maryland, Virginia, West Virginia, Texas, New York, Colorado, Mississippi, Indiana,
Kentucky, Ohio, Pennsylvania, Washington, D.C. and New Mexico. Executive further warrants and
represents that, because of his varied skill and abilities, he does not need to compete with the
Business of the Company and that this Agreement will not prevent him from earning a livelihood and
acknowledges that the restrictions contained in this Section 12 constitute reasonable protections
for the Company.

     As used in this Section 12, the “Non-Compete Period” shall mean for a period of one (1) year
after the date of the termination of Executive’s employment in connection with such Permitted
Executive Termination.

     13. Miscellaneous.

     (a) This Agreement shall be governed by and construed in accordance with the laws of the State
of Delaware, without reference to principles of conflict of laws. Any legal action, suit or
proceeding arising out of or relating to this Agreement shall be instituted in the state or federal
courts in the State of Delaware and the parties agree not to assert, in any action, suit or
proceeding by way of motion, as a defense or otherwise, any claim that either party is not
personally subject to the jurisdiction of such court, or that such action, suit or proceeding is
brought in an inconvenient forum, or that the venue is improper or that the subject matter hereof
cannot be enforced in such court. The parties hereby irrevocably submit to the jurisdiction of any
such court in any such action, suit or proceeding.

     (b) The captions of this Agreement are not part of the provisions hereof and shall have no
force or effect. This Agreement may not be amended or modified otherwise than by a written
agreement executed by the parties hereto or their respective successors and legal representatives.

     (c) All notices and other communications hereunder shall be in writing and shall be given by
hand delivery to the other party, by FedEx or other commercial overnight courier or by registered
or certified mail, return receipt requested, postage prepaid, addressed as follows:

If to the Executive:

P.O. Box 422175, Atlanta, GA 30342

13

 

If to the Company:

1000 Abernathy Road

Suite 1200

Atlanta, Georgia 30328

Attention: Company Secretary

or to such other address as either party shall have furnished to the other in writing in accordance
herewith. Notice and communications shall be effective when actually received by the addressee.

     (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’s or the Company’s failure 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) through (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.

     (g) Except as may otherwise be provided under any other written agreement between the
Executive and the Company, the Executive and the Company acknowledge that 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 to the subject matter hereof and,
upon the Effective Date, any such other agreement shall be null, void and of no further force or
effect. Furthermore, from and after the date of this Agreement, this Agreement shall amend,
restate and supersede that certain Employment Agreement dated as of September 1, 2004 between the
Company and the Executive, which Employment Agreement shall be null, void and of no further force
or effect.

     14. Compliance with Section 409A of the Code. This Agreement is intended to comply
with Section 409A of the Internal Revenue Code of 1986, as amended (the “Code”) and will be
interpreted in a manner intended to comply with Section 409A of the Code. Notwithstanding
anything herein to the contrary, in the event any payments or benefits required to be provided
hereunder are deemed to constitute payments of “nonqualified deferred compensation” that is subject
to the requirements of Section 409A of the Code, then the time and manner in which such payment or
benefit is provided shall be adjusted, to the extent reasonably possible, so that payment or
distribution is made at a time and in a manner that is consistent with the requirements of such
Section 409A (and applicable proposed or final Treasury regulations or other guidance issued or to
be issued by the Internal Revenue Service). This Section 14 may, for example, require that certain
payments to Executive following his termination of employment be delayed until the date that is six
(6) months after the date of his separation from service with the Company (the “Delay Period”) if,
at the time of Executive’s termination of employment with the Company, Executive is a “specified
employee” (as that term is used for purposes of Section 409A(2)(B)(i)). Upon the expiration of the
Delay Period, all payments and benefits delayed pursuant to this Section 14 (whether they would
have otherwise been payable in a single sum or in installments in the absence of such delay) shall
be paid or reimbursed to the Executive in a lump sum, and any remaining payments and benefits due
under this Agreement shall be paid or provided in accordance with the normal payment dates
specified for them herein.

14

 

     To the extent any reimbursements or in-kind benefits due to Executive under this Agreement
constitutes “deferred compensation” under Section 409A of the Code, any such reimbursements or
in-kind benefits shall be paid to Executive in a manner consistent with Treas. Reg. Section
1.409A-3(i)(1)(iv). Each payment made under this Agreement shall be designated as a “separate
payment” within the meaning of Section 409A of the Code. The Executive shall be deemed to have a
“termination of employment” under this Agreement for purposes of entitling him to any “nonqualified
deferred compensation” that is subject to the requirements of Section 409A only to the extent the
Executive has a “separation from service,” as that term is defined in Section 409A and the
applicable Treasury regulations applying all of the default rules thereunder. The Company shall
consult with Executive in good faith regarding the implementation of the provisions of this Section
14.

     IN WITNESS WHEREOF, the Executive has hereunto set the Executive’s hand and, pursuant to the
authorization from its Board of Directors, the Company has caused these presents to be executed in
its name on its behalf, all as of the day and year first above written.

	 	 	 	 	 
	 	 	 
	 	                         /s/ Michael H. Furlow
 	 
	 	MICHAEL H. FURLOW 	 
	 	 	 
	 	BEAZER HOMES USA, INC. 	 
	 
	 	By  	                         /s/ Ian J. McCarthy
 	 
	 	 	Ian J. McCarthy 	 
	 	 	President and Chief Executive Officer 	 
	 

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