Document:

exhibit10_9.htm

    

     

    SENIOR
      SECURED PROMISSORY NOTE

     

    $  50,000.00 July
      25, 2007

    Sarasota,
      Florida

     

    FOR
      VALUE
      RECEIVED, the undersigned, INVISA, INC., a Nevada corporation
      (“Borrower”) having an address at 6935 15th
      Street, Suite 120,
      Sarasota, Florida, 34243 promises to pay to the order of [Centurian Investors,
      Inc, a Delaware corporation] (“Lender”), having an
      office at 290  Cocoanut Avenue, Sarasota, Florida, or such other place
      as the Lender may designate in writing, the principal amount up to and not
      to
      exceed

     

    FIFTY
      THOUSAND United States Dollars (U.S. $50,000.00), to the extent advanced
      hereunder and then outstanding, with interest on the unpaid principal balance
      from the date of this Senior Secured Promissory Note (this
“Promissory Note”), until paid, at the Interest Rate (as
      hereinafter defined) provided herein. 

     

    1.           Rate
      of Interest.  The outstanding principal balance of this
      Promissory Note shall bear interest at ten percent (10%) per annum (the
“Interest Rate”).

     

                            2.           Date
      and Time of Payment.  The outstanding principal balance
      of this Promissory Note, together with all accrued and unpaid
      interest,  shall be paid in full on earlier to occur of (a) the
      Maturity Date or (b) the date of termination of this Promissory Note, whether
      by
      its terms, by prepayment, or by acceleration.  All amounts outstanding
      hereunder shall constitute Borrower’s obligations hereunder, and such
      obligations include without limitation all principal, interest (including all
      interest which accrues after the commencement of any case or proceeding by
      or
      against Borrower in bankruptcy whether or not allowed in such case or
      proceeding), expenses, attorneys’ fees and any other sum chargeable to Borrower
      hereunder and owing to Lender under this Promissory Note (all such obligations
      and all other obligations of Borrower under this Promissory Note ,(the
“Obligations”).  No principal amount of this
      Note paid or prepaid may be reborrowed.

     

                              3.          Default
      Rate.  Notwithstanding Section 1, after the
      occurrence of any Event of Default and for so long as such Event of Default
      continues, and in any event from and after the Maturity Date, all principal,
      interest and other amounts payable under this Promissory Note shall bear
      interest until paid in full at a rate of interest equal to four percent (4%)
      above the per annum rate otherwise applicable hereunder (the “Default
      Rate”).

     

                              4.           Computation
      of Interest.  Interest on the principal amount hereof and
      all other Obligations shall be computed on the basis of a 360-day year, and
      shall be charged for the actual number of days elapsed during any month or
      other
      accrual period.

     

                              5.           Manner
      of Payment.  All payments by Borrower in respect of any
      Obligations shall be made without deduction, defense, set off or counterclaim,
      free and clear of all taxes delivered to Lender.

     

                              6.           Maturity.  To
      the extent not sooner due and payable in accordance with this Promissory Note
      ,
      the Obigations  shall be due and payable on August 28, 2007 (the
“Maturity Date”).

                     
      7.          Application
      of Payments.  All payments shall be applied to amounts
      then due and payable in the following order:  (a) to Lender’s costs
      and expenses reimbursable in connection herewith; (b) to interest accrued on
      the
      outstanding principal balance of this Promissory Note; (c) to the principal
      amount hereof; and (d) to all other Obligations, or in such other manner as
      Lender shall determine in its sole and exclusive discretion.

     

    
      
        
        

      

      
        1

        
          

        

      

      
        
        

      

    

     
      8.           Procedure
      for Borrowing and Use of Proceeds.The proceeds of
      this Promissory Note shall be funded in multiple advances (each, an
“Advance”) by Lender to Borrower in the amounts and on
      such dates as determined by Lender based on requests from
      Borrower.  Borrower shall give Lender notice requesting that Lender
      make an Advance in accordance herewith specifying (a) the Borrowing Date, (b)
      the amount requested and (c) a detailed, itemized list of the use of such
      Advance.  Upon receipt of such notice from Borrower, Lender shall
      determine, in its sole and exclusive discretion, whether it shall make such
      amount available to Borrower on the Borrowing Date.  Upon each
      Advance, Lender shall record each Advance on Schedule I to this Promissory
      Note.  For purposes of this Section 8, the Borrowing Date shall mean
      any business day specified in the notice pursuant to this Section 8 as a date
      on
      which Borrower requests Lender to make a loan hereunder.  An initial
      Advance of  Six Thousand Five Hundred Eighty Six Dollars ($6,586.00)
      shall be made prior to or simulateously with the execution of this Promissory
      Note.  The obligation of Lender to make each subsequent Advance
      following the initial Advance hereunder is subject to the Lenders approval
      of
      the loan request made by Borrower in accordance with this Section 8 and shall
      be
      funded in the sole and exclusive discretion of Lender. 

     

      9.           Security.  This
      Promissory Note shall be secured by (i) Six  Million Six Hundred and
      Sixty Six (6,666,666) shares of common stock of Borrower to be issued as of
      the
      date hereof and held in escrow and a continuing first priority security interest
      in all of Borrower’s right, title, and interest in and to, all property of
      Borrower (collectively, the “Collateral”), as more
      specifically set forth in the Security Agreement executed by Borrower in favor
      of Lender dated as of February 28, 2007.  (the “Security
      Agreement”).

     

    10.           Priority This
      Promissory Note shall be a senior obligation of Borrower, and for so long as
      this Promissory Note shall be outstanding, (i) Borrower shall be prohibited
      from
      incurring any and all future indebtedness without the prior written consent
      of
      Lender and (ii) any and all future indebtedness approved by Borrower in writing
      shall be deemed subordinate and inferior to, all respective right, title and
      interest of Lender, in, to and under this Promissory Note, this Security
      Agreement and any and all documents and instruments evidencing, securing or
      otherwise relating to this Promissory Note.

     

             
                            11.           Representations
      and Warranties.  Borrower makes the
      following representations and warranties to Lender, which representations and
      warranties shall be true, correct, and complete as of the date hereof and shall
      survive the execution and delivery of this Promissory Note.

     

    (a)  Due
      Organization and Qualification.  Borrower is duly
      organized and validly existing and in good standing under the laws of the
      jurisdiction of its organization and qualified to do business in any
      jurisdiction where it is required to be so qualified, and has all requisite
      power and authority to (i) own its assets and carry on its business, and (ii)
      execute, deliver and perform its Obligations.

     

    (b)  Due
      Authorization; No Conflict.  The execution, delivery, and
      performance by Borrower of this Promissory Note has been duly authorized by
      all
      necessary action on the part of Borrower.  This Promissory Note has
      been duly executed and delivered by Borrower.  The execution,
      delivery, and performance by Borrower of this Promissory Note and the
      consummation of the transactions contemplated hereby, do not and will not (i)
      violate in any material respect any provision of federal, state, provincial
      or
      local law or regulation applicable to Borrower, its organizational documents,
      or
      any order, judgment, or decree of any court or other governmental authority,
      (ii) conflict with, result in a breach or termination of, or constitute (with
      due notice or lapse of time or both) a default under any material contractual
      obligation of Borrower, (iii) result in or require the creation or imposition
      of
      any lien of any nature whatsoever upon any properties or assets of Borrower,
      other than liens or security interests in favor of Lender, or (iv) require
      any
      approval of any of Borrower’s stockholders or any approval or consent of any
      other person or entity, other than consents or approvals that have been obtained
      and that are still in force and effect.  The execution, delivery, and
      performance by Borrower of this Promissory Note do not and will not require
      any
      registration with, consent, or approval of, or notice to, or other action with
      or by, any governmental authority, other than consents or approvals that have
      been obtained and that are still in force and effect.  This Promissory
      Note when executed and delivered by Borrower will be the legally valid and
      binding obligation of Borrower, enforceable against Borrower in accordance
      with
      its term, except as enforcement may be limited by equitable principles or by
      bankruptcy, insolvency, reorganization, moratorium, or similar laws relating
      to
      or limiting creditors’ rights generally.

     

    
      
        
        

      

      
        2

        
          

        

      

      
        
        

      

    

    (c)  No
      Litigation.  No litigation, investigation or proceeding of or
      before any arbitrator or government authority is (i) pending or, to the
      knowledge of Borrower, threatened with respect to this Promissory Note or the
      Collateral or any of the transactions contemplated hereby or (ii) pending or,
      to
      the knowledge of Borrower, threatened by or against Borrower, its properties
      or
      revenues which, if adversely determined, would have a material adverse effect
      on
      its business, operations, property or financial condition, when taken as a
      whole.

     

    (d)  No
      Default.  Borrower is not in default under or with
      respect to any contractual obligation and no event of default has occurred
      or is
      continuing with respect to Borrower.

     

    (e)  Taxes.  Borrower
      has filed or caused to be filed all tax returns required to be filed by it
      and
      has paid all taxes due and payable on said returns or on any assessments made
      against Borrower or any of its property.   All other taxes, fees
      or other charges on Borrower or any of its property by any governmental
      authority have been paid and no tax liens have been filed.

     

    12.  Covenants
      of
      Borrower.  As of the date hereof and so long as the
      Obligations hereunder shall be outstanding:

     

    (a)  Borrower
      will preserve
      and keep in force and effect, its corporate existence and all licenses and
      permits necessary to the proper conduct of its business;

    

    (b)  Borrower
      will promptly
      pay and discharge, all lawful taxes, assessments, charges or levies imposed
      upon
      Borrower, or upon or in respect of all or any part of the property or business
      of Borrower, all trade accounts payable in accordance with usual and customary
      business terms and all claims for work, labor or materials, which if unpaid
      might become a lien or charge upon any property of Borrower; provided,
      Borrower shall not be required to pay such tax, assessment, charge, levy,
      account payable or claim if (i) the validity, applicability or amount thereof
      is
      being contested in good faith by appropriate action or proceeding which will
      prevent the forfeiture or sale of any property of Borrower, and (ii) Borrower
      shall set aside on its books, reserves deemed by it to be adequate with respect
      thereto;

    

    (c)  Borrower
      will promptly
      comply with all laws, ordinances or governmental rules and regulation to which
      it is subject, the violations of which would materially or adversely affect
      its
      properties, business, prospects, profits or condition or would result in any
      material lien or charge upon any property of Borrower;

    

    (d)  Borrower
      will maintain,
      preserve and keep its properties which are used or useful in the conduct of
      its
      business in good repair and working order;

    

    (e)  Borrower
      will not
      create, assume or incur or in any manner become liable with respect of any
      indebtedness except this Promissory Note and any indebtedness of Borrower
      incurred prior to the date hereof.

    

    (f)  Borrower
      will not create
      or incur any mortgage, pledge, security interest, encumbrance, lien or charge
      of
      any kind (a “Lien”) on its or its property or assets, whether now owned or
      hereinafter acquired, or upon any income or profits
      therefrom  except

    

    (i)           Liens
      for property taxes and assessments or levies and liens that are not yet due
      and
      payable;

    

    (ii)           Liens
      of or resulting from any judgment or award, the time for appeal or petition
      for
      rehearing of which shall not have expired or in respect of which the Company
      shall in good faith be prosecuting an appeal or proceeding for a review and
      in
      respect of which a stay of execution pending such appeal or proceeding for
      review shall have been secured; or

    

    (iii)           Liens
      or priority claims (A) incidental to the conduct of business, (B) created by
      any
      material agreement of Borrower entered into prior to and currently in effect
      as
      of the date hereof or (C) the ownership or lease of properties and assets and
      not in connection with the borrowing of money, provided, in each case,
      the obligation secured is not overdue, or if overdue, is being contested in
      good
      faith by appropriate actions or proceedings and provided, further
that Borrower shall have received the prior written consent
      of Lender to any
      Lien described in (A) or (C) above; or

    

    13.           Events
      of Default; Remedies; Acceleration.  (a) The occurrence
      of any one or more of the following events (regardless of the reason therefor)
      shall constitute an “Event of Default”
hereunder:

     

                              (i)
      Borrower fails to make any payment of outstanding principal balance of this
      Promissory Note , or interest thereon, or any of the other Obligation when
      due
      and payable;

     

                              (ii)
      Any representation or warranty of Borrower made in this Promissory Note, the
      Security Agreeent,  or any other document made by or on behalf of
      Borrower in connection herewith and the transactions contemplated hereby proves
      to have been false or incorrect in any material respect or Borrower shall fail
      to comply in all respects with any covenant herein or therein;

     

    
      
        
        

      

      
        3

        
          

        

      

      
        
        

      

    

     (iii)
      Borrower shall violate any
      provision of this Promissory Note, the Security Agreement or any other document
      made by or on behalf of Borrower in connection herewith and the transactions
      contemplated hereby, including, without limitiation, failure to comply with
      the
      terms and provisions of Section 8 of this Promissory Note;

     

                              (iv)
      A case or proceeding is commenced against Borrower seeking a decree or order
      (i)
      under Title 11 of the United States Bankruptcy Code (11 U.S.C. §§101 et
      seq., as amended, and any successor statute, the “Bankruptcy
      Code”), or any other applicable federal, state or foreign
      bankruptcy or other similar law, rule or regulation, (ii) appointing a
      custodian, receiver, liquidator, assignee, trustee or sequestrator (or similar
      official) for Borrower or for any substantial part of Borrower’s assets, or
      (iii) ordering the winding-up or liquidation of the affairs of s Borrower,
      and
      such case or proceeding shall remain undismissed or unstayed for sixty (60)
      days
      or more or a decree or order granting the relief sought in such case or
      proceeding shall be entered by a court of competent jurisdiction;

     

                              (v)
      Borrower, without the prior written consent of Lender (A) files a petition
      seeking relief under the Bankruptcy Code, or any other applicable federal,
      state
      or foreign bankruptcy or other similar law, rule or regulation, (B) consents
      to
      or fails to contest in a timely and appropriate manner the institution of
      proceedings thereunder or the filing of any such petition or the appointment
      of
      or taking possession by a custodian, receiver, liquidator, assignee, trustee
      or
      sequestrator (or similar official) for Borrower or for any substantial part
      of
      Borrower’s assets, (C) makes an assignment for the benefit of creditors, (D)
      takes any action in furtherance of any of the foregoing; or (E) admits in
      writing its inability to, or is generally unable to, pay its debts as such
      debts
      become due;

     

                              (vi)  If
      this Promissory Note, the Security Agreement, or any financing statement,
      document or other instrument executed, delivered or filed in connection herewith
      or with the security interest granted to Lender hereunder, shall, for any
      reason, fail or cease to create a valid and perfected lien on or security
      interest in any or all of the Collateral or the Collateral shall be compromised,
      encumbered or, in the case of the common stock, invalid, cancelled or otherwise
      rescinded;

     

     
      (vi) If Borrower shall default on any material obligations of Borrower or an
      event of default shall occur with respect to any material agreement of Borrower,
      whether such agreement shall be in effect or effective subsequent to this
      Promissory Note.

     

    (b)  Immediately
      upon the
      occurrence of any Event of Default, all of the Obligations of Borrower
      hereunder shall become immediately due and payable to Lender and the Obligations
      shall thereafter accrue interest at the Default Rate from the date of any Event
      of Default until such Obligations are paid in full (an
“Accelleration”).  Promptly upon the occurrence of an Acceleration,
      Lender shall send Borrower written notice of the date upon which the
      Acceleration is effective and the names of  two (2) representatives of
      Lender (“Lender Nominees”) to be immediately appointed to the Board of Directors
      of Borrower (the “Default Notice”).  The Lender Nominees shall be
      appointed to the Board of Directors of Borrower not less than five days
      following the date of the Default Notice.  Except with respect to an
      Event of Default  under Section 13(a)(iv) and (v), Borrower shall have
      forty five (45) days (the forty fifth day hereinafter being the “Final Payment
      Date”) from the date of the Default Notice to pay Lender the total amount of the
      Obligations due and owning under this Promissory Note.  In the event
      that Borrower shall fail to satisfy in full all of the outstanding Obligations
      under this Promissory Note on or before the Final Payment Date, then Lender
      may
      (i) proceed to protect and enforce Lender’s rights by suit in equity, action at
      law and/or other appropriate proceeding, either for specific performance of
      any
      covenant or condition contained in this Promissory Note, the Security Agreement,
      or in any instrument or document delivered to Lender pursuant to this Promissory
      Note , or in aid of the exercise of any power granted in this Promissory Note
      or
      any such instrument or document, and (ii) proceed to enforce payment of the
      Obligations in such manner as Lender may elect, including the foreclosure of
      the
      Collateral in accordance with the terms of the Security Agreement, and to
      realize upon any and all rights of Lender hereunder.  Upon the
      occurrence of any Event of Default under Section 13(a)(iv) and (v), Lender
      shall
      have a right to immediately enforce its rights hereunder and proceed against
      or
      foreclose upon the Collateral without regard to the 45 day period set forth
      in
      this Section 13(b) To the extent not prohibited by applicable law which cannot
      be waived, all of Lender’s rights hereunder shall be
      cumulative.  Lender shall have all other rights and remedies not
      inconsistent herewith as provided under applicable law or in equity, and no
      exercise by Lender of one right or remedy shall be deemed an election, and
      no
      waiver by Lender of any Event of Default shall be deemed a continuing
      waiver.   No delay by Lender shall constitute a waiver, election
      or acquiescence by it.

     

    
      
        
        

      

      
        4

        
          

        

      

      
        
        

      

    

    (c)
      In the event that the Obligations
      hereunder shall be paid in full by or on behalf of Borrower, after the
      Acceleration of this Promissory Note but prior to the Final Payment Date, then
      this Promissory Note shall be deemed paid in full, Lender shall promptly release
      any lien of Lender on the Collateral, and each Lender Nominee shall immediately
      resign from the Board of Directors of Borrower.   

     

                          14.  Certain Rights
      and Waivers.  To the extent not prohibited by the
      provisions of applicable law, Borrower hereby expressly waives: (a) all
      presentments, demands for performance, notices of nonperformance (except to
      the
      extent required by this Note), protests, notices of protest and notices of
      dishonor; (b) any requirement of diligence or promptness on the part of Lender
      in the enforcement of its rights under this Note; (c) any and all notices of
      every kind and description which may be required to be given by any statute
      or
      rule of law; and (d) any defense (other than indefeasible payment in full)
      which
      it may now or hereafter have with respect to its liability under this
      Note.

     

    15.  Assignments.  Borrower
      may not assign or transfer any of its rights or obligations hereunder without
      the express, written consent of Lender.  Any such purported assignment
      or transfer by Borrower without the express, written consent of Lender shall
      be
      null and void ab initio.

     

     

    16.  Costs
      and Expenses.  Borrower agrees to pay all costs and
      expenses of Lender, including without limitation all fees and disbursements
      of
      counsel, advisors, consultants, examiners and appraisers for Lender, in
      connection with (a) the issuance of this Promissory Note and advancement of
      principal amount hereunder (which fees and disbursements associated with the
      origination of this Promissory Note shall not exceed $3,500.00), (b) any
      enforcement (whether through negotiations, legal process or otherwise) of this
      Promissory Note, (c) any workout or restructuring of this Promissory Note during
      the pendency of one or more Events of Default, (d) any bankruptcy case or
      proceeding of Borrower or any appeal thereof, and (e) upon the occurrence and
      during the continuance of an Event of Default, any efforts to verify, protect,
      evaluate, assess, appraise, collect, sell, liquidate or otherwise dispose of
      any
      of the Collateral.

     

               17.  CHOICE
      OF LAW. THE VALIDITY OF THIS NOTE,
      THE CONSTRUCTION, INTERPRETATION, AND ENFORCEMENT HEREOF, AND THE RIGHTS OF
      THE
      BORROWER AND LENDER WITH RESPECT TO ALL MATTERS ARISING HEREUNDER OR RELATED
      HERETO SHALL BE DETERMINED UNDER, GOVERNED BY, AND CONSTRUED IN ACCORDANCE
      WITH
      THE LAWS OF THE STATE OF FLORIDA, WITHOUT REFERENCE TO
      CONFLICTS OF LAW PRINCIPLES EXCEPT TO THE EXTENT NECESSARY TO ENFORCE THIS
      CHOICE OF LAW PROVISION.

     

    18. Notices.  All
      communications hereunder shall be in writing and shall be deemed to be duly
      given and received (a) upon delivery if delivered personally or upon confirmed
      transmittal if by facsimile, (b) on the next Business Day if sent by
      overnight courier, or (c) four (4) Business Days after mailing if mailed by
      prepaid registered mail, return receipt requested, in each case to the
      appropriate notice address or facsimile number. 

     

    19.  Independent
      Arms Length Transaction.  It is understood and agreed
      that this Promissory Note, the Security Agreement and the transactions
      contemplated hereby and thereby were negotiated in an arms length transacton
      separate and distinct from any other transaction or contractual obligations
      and
      are independent of any transaction or transactions between Borrower, on the
      one
      hand, and Lender and any of its affilates or related entitles on the other
      hand.   Borrower further agrees that the contractual obligations
      of Borrower hereunder are in no way dependent or conditioned upon any other
      agreements, contracts or transactions whatsoever unless expressly stated
      herein.

     

    IN
      WITNESS WHEREOF, the undersigned has executed this Promissory Note as of the
      date first written above.

     

    
      	
               

              Dated:  July 25, 2007

            	
              INVISA,
                INC.

               

              By:  _/s/Edmund
                C.King_________

              Name:  Edmund
                C. King

              Title:  Chief
                Financial Officer

               

            
	 	 

    

    
      
        
        

      

      
        5Exhibit 10.1

    
      

    

    
      EXHIBIT
        10.1

       

    

    EXECUTION
      COPY

    

     

    CREDIT
      AGREEMENT

    _________________________________

     

    Dated
      as
      of July 25, 2007 

    

    BEAZER
      HOMES USA, INC.,

    THE
      LENDERS PARTY THERETO,

    WACHOVIA
      BANK, NATIONAL ASSOCIATION,

    as
      Agent,

     

    and

     

    CITICORP
      NORTH AMERICA, INC.,

    as
      Syndication Agent,

     

    and

     

    BNP
      PARIBAS, 

    THE
      ROYAL
      BANK OF SCOTLAND

    and

    GUARANTY
      BANK,

    as
      Documentation Agents

     

    and

     

    REGIONS
      BANK,

    as
      Senior
      Managing Agent

     

    and

     

    JPMORGAN
      CHASE BANK, N.A.,

    as
      Managing Agent

     

     

    WACHOVIA
      CAPITAL MARKETS, LLC

     

    and

     

    CITIGROUP
      GLOBAL MARKETS INC.

    Joint
      Lead Arrangers and Joint Bookrunners

    _________________________________

     

    $500,000,000
      REVOLVING CREDIT FACILITY

    _________________________________

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    

    Table
      of Contents

     

    
      	 	
              
              
Page
	
               

              ARTICLE
                I DEFINITIONS AND ACCOUNTING TERMS

            	
               

              1

            
	
              Section
                1.01 Defined Terms

            	
              1

            
	
              Section
                1.02 Accounting Terms

            	
              18

            
	
               

              ARTICLE
                II AMOUNTS AND TERMS OF THE LOANS

            	
               

              18

            
	
              Section
                2.01 The Facility.

            	
              18

            
	
              Section
                2.02 Reductions of and Increases in Aggregate Commitment.

            	
              19

            
	
              Section
                2.03 Notice and Manner of Borrowing

            	
              21

            
	
              Section
                2.04 Non-Receipt of Funds by Agent

            	
              22

            
	
              Section
                2.05 Determination of Applicable Eurodollar Margin

            	
              22

            
	
              Section
                2.06 Conversions and Renewals

            	
              24

            
	
              Section
                2.07 Interest

            	
              24

            
	
              Section
                2.08 Interest Rate Determination

            	
              25

            
	
              Section
                2.09 Fees

            	
              26

            
	
              Section
                2.10 Notes

            	
              26

            
	
              Section
                2.11 Prepayments

            	
              27

            
	
              Section
                2.12 Method of Payment

            	
              27

            
	
              Section
                2.13 Use of Proceeds

            	
              28

            
	
              Section
                2.14 Yield Protection

            	
              28

            
	
              Section
                2.15 Changes in Capital Adequacy Regulations

            	
              29

            
	
              Section
                2.16 Availability of Eurodollar Loans

            	
              29

            
	
              Section
                2.17 Funding Indemnification

            	
              29

            
	
              Section
                2.18 Lender Statements; Survival of Indemnity

            	
              29

            
	
              Section
                2.19 Extension of Termination Date

            	
              30

            
	
              Section
                2.20 Replacement of Certain Lenders

            	
              32

            
	
              Section
                2.21 Swing Line

            	
              33

            
	
              Section
                2.22 Facility Letters of Credit.

            	
              33

            
	
               

              ARTICLE
                III CONDITIONS PRECEDENT

            	
               

              41

            
	
              Section
                3.01 Conditions Precedent to Initial Loans

            	
              41

            
	
              Section
                3.02 Conditions Precedent to All Loans

            	
              43

            
	
               

              ARTICLE
                IV REPRESENTATIONS AND WARRANTIES

            	
               

              44

            
	
              Section
                4.01 Incorporation, Formation, Good Standing, and Due
                Qualification

            	
              44

            
	
              Section
                4.02 Power and Authority

            	
              44

            
	
              Section
                4.03 Legally Enforceable Agreement

            	
              44

            
	
              Section
                4.04 Financial Statements

            	
              44

            
	
              Section
                4.05 Labor Disputes and Acts of God

            	
              45

            
	
              Section
                4.06 Other Agreements

            	
              45

            
	
              Section
                4.07 Litigation

            	
              45

            
	
              Section
                4.08 No Defaults on Outstanding Judgments or Orders

            	
              45

            
	
              Section
                4.09 Ownership and Liens

            	
              46

            
	
              Section
                4.10 Subsidiaries and Ownership of Stock

            	
              46

            

    

     

    
      
        
        

      

      
        i

        
          

        

      

      
        
        

      

    

     

    
      	
              Section
                4.11 ERISA

            	
              46

            
	
              Section
                4.12 Operation of Business

            	
              46

            
	
              Section
                4.13 Taxes

            	
              47

            
	
              Section
                4.14 Laws; Environment

            	
              47

            
	
              Section
                4.15 Investment Company Act

            	
              48

            
	
              Section
                4.16 OFAC

            	
              48

            
	
              Section
                4.17 Accuracy of Information

            	
              48

            
	
               

              ARTICLE
                V AFFIRMATIVE COVENANTS

            	
               

              48

            
	
              Section
                5.01 Maintenance of Existence

            	
              48

            
	
              Section
                5.02 Maintenance of Records

            	
              49

            
	
              Section
                5.03 Maintenance of Properties

            	
              49

            
	
              Section
                5.04 Conduct of Business

            	
              49

            
	
              Section
                5.05 Maintenance of Insurance

            	
              49

            
	
              Section
                5.06 Compliance with Laws

            	
              49

            
	
              Section
                5.07 Right of Inspection

            	
              49

            
	
              Section
                5.08 Reporting Requirements

            	
              50

            
	
              Section
                5.09 Subsidiary Reporting Requirements

            	
              53

            
	
              Section
                5.10 Environment

            	
              53

            
	
              Section
                5.11 Use of Proceeds

            	
              54

            
	
              Section
                5.12 Ranking of Obligations

            	
              54

            
	
              Section
                5.13 Taxes

            	
              54

            
	
              Section
                5.14 Wholly-Owned Status

            	
              54

            
	
              Section
                5.15 New Subsidiaries

            	
              54

            
	
               

              ARTICLE
                VI NEGATIVE COVENANTS

            	
               

              54

            
	
              Section
                6.01 Liens

            	
              54

            
	
              Section
                6.02 Secured Debt

            	
              55

            
	
              Section
                6.03 Mergers, Etc

            	
              55

            
	
              Section
                6.04 Leases

            	
              55

            
	
              Section
                6.05 Sale and Leaseback

            	
              56

            
	
              Section
                6.06 Sale of Assets

            	
              56

            
	
              Section
                6.07 Investments

            	
              56

            
	
              Section
                6.08 Guaranties, Etc

            	
              57

            
	
              Section
                6.09 Transactions With Affiliates

            	
              57

            
	
              Section
                6.10 Housing Inventory

            	
              57

            
	
              Section
                6.11 Amendment or Modification of Senior Indentures

            	
              58

            
	
              Section
                6.12 Non-Guarantors

            	
              58

            
	
              Section
                6.13 Negative Pledges

            	
              58

            
	
               

              ARTICLE
                VII FINANCIAL COVENANTS

            	
               

              58

            
	
              Section
                7.01 Minimum Consolidated Tangible Net Worth

            	
              58

            
	
              Section
                7.02 Leverage Ratio

            	
              59

            
	
              Section
                7.03 Borrowing Base Debt

            	
              59

            
	
              Section
                7.04 Interest Coverage Ratio

            	
              59

            
	
              Section
                7.05 Land Inventory

            	
              59

            
	
              Section
                7.06 Minimum Liquidity

            	
              59

            

    

     

    
      
        
        

      

      
        ii

        
          

        

      

      
        
        

      

    

     

    
      	
               

              ARTICLE
                VIII EVENTS OF DEFAULT

            	
               

              59

            
	
              Section
                8.01 Events of Default

            	
              59

            
	
              Section
                8.02 Set Off

            	
              62

            
	
               

              ARTICLE
                IX AGENCY PROVISIONS

            	
               

              63

            
	
              Section
                9.01 Authorization and Action

            	
              63

            
	
              Section
                9.02 Liability of Agent

            	
              63

            
	
              Section
                9.03 Rights of Agent as a Lender

            	
              64

            
	
              Section
                9.04 Independent Credit Decisions

            	
              64

            
	
              Section
                9.05 Indemnification

            	
              64

            
	
              Section
                9.06 Successor Agent

            	
              65

            
	
              Section
                9.07 Sharing of Payments, Etc

            	
              65

            
	
              Section
                9.08 Withholding Tax Matters

            	
              65

            
	
              Section
                9.09 Syndication Agents, Documentation Agents, Managing Agents or
                Co-Agents

            	
              66

            
	
               

              ARTICLE
                X MISCELLANEOUS

            	
               

              66

            
	
              Section
                10.01 Amendments, Etc

            	
              66

            
	
              Section
                10.02 Notices, Etc

            	
              67

            
	
              Section
                10.03 No Waiver

            	
              67

            
	
              Section
                10.04 Costs, Expenses, and Taxes

            	
              67

            
	
              Section
                10.05 Integration

            	
              68

            
	
              Section
                10.06 Indemnity

            	
              68

            
	
              Section
                10.07 CHOICE OF LAW

            	
              68

            
	
              Section
                10.08 Severability of Provisions

            	
              68

            
	
              Section
                10.09 Counterparts

            	
              69

            
	
              Section
                10.10 Headings

            	
              69

            
	
              Section
                10.11 CONSENT TO JURISDICTION

            	
              69

            
	
              Section
                10.12 WAIVER OF JURY TRIAL

            	
              69

            
	
              Section
                10.13 Governmental Regulation

            	
              69

            
	
              Section
                10.14 No Fiduciary Duty

            	
              69

            
	
              Section
                10.15 Confidentiality

            	
              70

            
	
              Section
                10.16 USA Patriot Act Notification

            	
              70

            
	
              Section
                10.17 Register

            	
              70

            
	
               

              ARTICLE
                XI BENEFIT OF AGREEMENT; ASSIGNMENTS; PARTICIPATIONS

            	
               

              70

            
	
              Section
                11.01 Successors and Assigns

            	
              70

            
	
              Section
                11.02 Assignments.

            	
              71

            
	
              Section
                11.03 Participations

            	
              71

            
	
              Section
                11.04 Pledge to Federal Reserve Bank

            	
              72

            
	 	 

    

     

    
      
        
        

      

      
        iii

        
          

        

      

      
        
        

      

    

     

    

    LIST
      OF
      SCHEDULES AND EXHIBITS

     

    
      	
              Schedule

               

            	 	
              Description

               

            	 	
              Reference

               

            
	
              Schedule
                I

               

            	 	
              Commitments

               

            	 	
              2.01

               

            
	
              Schedule
                II

               

            	 	
              Existing
                Letters of Credit

               

            	 	
              Definition

               

            
	
              Schedule
                III

               

            	 	
              Guarantors

               

            	 	
              Definition

               

            
	
              Schedule
                4.0

               

            	 	
              Claims

               

            	 	
              4.07

               

            
	
              Schedule
                4.10

               

            	 	
              Subsidiaries
                of Borrower

               

            	 	
              4.10

               

            
	
              Schedule
                4.14

               

            	 	
              Environmental
                Matters

               

            	 	
              4.10,
                5.06, 5.10, 8.01(10)

               

            

    

    

     

    
      	
              Exhibit

               

            	 	
              Description

               

            	 	
              Reference

               

            
	
              Exhibit
                A

               

            	 	
              Form
                of Guaranty

               

            	 	
              Definition

               

            
	
              Exhibit
                B

               

            	 	
              Form
                of Note

               

            	 	
              Definition

               

            
	
              Exhibit
                C

               

            	 	
              Commitment
                and Acceptance

               

            	 	
              2.02.2(a)

               

            
	
              Exhibit
                D

               

            	 	
              Form
                of Certificate for Borrowings

              and
                Facility Letters of Credit

            	 	
              2.22.3(iii),
                3.02

               

            
	
              Exhibit
                E

            	 	
              Opinion
                of Borrower’s 

              Counsel

            	 	
              3.01(5)

            
	
              Exhibit
                F

               

            	 	
              Assignment
                Agreement

               

            	 	
              11.02(b)(ii)

               

            

    

     

    
      
        
        

      

      
        iv

        
          

        

      

      
        
        

      

       

    

    CREDIT
      AGREEMENT dated as of July 25, 2007 among BEAZER HOMES USA, INC., a Delaware
      corporation (the “Borrower”), the Lenders that are signatories hereto and
      WACHOVIA BANK, NATIONAL ASSOCIATION, as Agent (the “Agent”) for the Lenders and
      an Issuer (as hereinafter defined).

     

    AGREEMENT

     

    In
      consideration of the mutual covenants and agreements hereinafter set forth,
      the
      parties hereto hereby agree as follows:

     

    ARTICLE
      I

    DEFINITIONS
      AND ACCOUNTING TERMS

     

    Section
      1.01   Defined
      Terms.
      As used
      in this Agreement, the following terms have the following meanings (terms
      defined in the singular shall have the same meaning when used in the plural
      and
      vice versa):

     

    “ABR
      Loan” means a Loan which bears interest at the Alternate Base Rate.

     

    “Acquisition”
      means any transaction, or any series of related transactions, consummated on
      or
      after the date of this Agreement by which the Borrower or any of its
      Subsidiaries (i) acquires any going concern or all or substantially all of
      the
      assets of any Person or division thereof, whether through purchase of assets,
      merger or otherwise or (ii) directly or indirectly acquires (in one transaction
      or as the most recent transaction in a series of transactions) at least a
      majority (in number of votes or by percentage of voting power) of the Common
      Equity of another Person.

     

    “Adjusted
      Land Value” means, as of any date, (i) the book value of all Land, less (ii) the
      sum of (a) the book value of Finished Lots that are subject to bona
      fide
      contracts of sale with Persons that are not Affiliates and (b) the lesser of
      (1)
      the product of (x) the number of Housing Units with respect to which the
      Borrower and its Subsidiaries (including any company or other entity acquired
      in
      an Acquisition by the Borrower or a Subsidiary as of such date) entered into
      bona
      fide
      contracts of sale with Persons that are not Affiliates during the six-month
      period ending on such date and (y) the average book value of all Finished Lots
      as of such date and (2) forty percent (40%) of Consolidated Tangible Net Worth
      as of such date.

     

    “Adjusted
      LIBO Rate”
means,
      with respect to any Eurodollar Loan for any Interest Period, an interest rate
      per annum (rounded upwards, if necessary, to the next 1/100 of 1%) equal to
      (a)
      the LIBO Rate for such Interest Period multiplied by (b) the Statutory Reserve
      Rate.

     

    “Administrative
      Questionnaire” means an Administrative Questionnaire in a form supplied by the
      Agent.

     

    “Affected
      Lender” is defined in Section 2.20(a).

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

       

    

    “Affiliate”
      means, with respect to any Person, any other Person (1) which directly or
      indirectly controls, or is controlled by, or is under common control with,
      such
      Person or a Subsidiary of such Person; (2) which directly or indirectly
      beneficially owns or holds five percent (5%) or more of any class of voting
      equity interests of such Person or any Subsidiary of such Person; or (3) five
      percent (5%) or more of the voting equity interests of which is directly or
      indirectly beneficially owned or held by such Person or a Subsidiary of such
      Person. The term “control” means the possession, directly or indirectly, of the
      power to direct or cause the direction of the management and policies of a
      Person, whether through the ownership of voting securities, by contract or
      otherwise.

     

    “Agent”
      means Wachovia Bank, National Association, a national banking
      association.

     

    “Agent’s
      Fee Letter” means that certain fee letter dated June 11, 2007 from the Agent and
      Arrangers to the Borrower and accepted by the Borrower on June 12,
      2007.

     

    “Aggregate
      Commitment” means, at any time, the aggregate Commitments of all the Lenders
      initially in the amount of $500,000,000 as the same may be reduced or increased
      from time to time pursuant to the terms of this Agreement.

     

    “Agreement”
      means this Credit Agreement, as amended, supplemented, or modified from time
      to
      time.

     

    “Alternate
      Base Rate”
means,
      for any day, a rate per annum equal to the greatest of (a) the Prime Rate in
      effect on such day and (b) the Federal Funds Effective Rate in effect on such
      day plus 1⁄2 of 1%. Any change in the Alternate Base Rate due to a change in the
      Prime Rate or the Federal Funds Effective Rate shall be effective from and
      including the effective date of such change in the Prime Rate or the Federal
      Funds Effective Rate, respectively.

     

    “Applicable
      Commitment Rate” means, as at any date of determination, a rate per annum equal
      to (a) 0.25% if the average daily unused portion of the Aggregate Commitment
      during the fiscal quarter ending on or immediately prior to such date of
      determination equals or exceeds 50% of the Aggregate Commitment, and (b) 0.20%
      if the average daily unused portion of the Aggregate Commitment during the
      fiscal quarter ending on or immediately prior to such date of determination
      is
      less than 50% of the Aggregate Commitment.

     

    “Applicable
      Eurodollar Margin” means, as at any date of determination, the margin indicated
      in Section 2.05 as then applicable to Eurodollar Loans (under Section
      2.07(a)(ii)).

     

    “Applicable
      Letter of Credit Rate” means, as at any date of determination, a rate per annum
      equal to the Applicable Eurodollar Margin.

     

    “Approved
      Fund” means any Person (other than a natural person) that is engaged in making,
      purchasing, holding or investing in bank loans and similar extensions of credit
      in the ordinary course of its business and that is administered or managed
      by
      (a) a Lender, (b) an Affiliate of a Lender or (c) an entity or an Affiliate
      of
      an entity that administers or manages a Lender.

     

    
      
        
        

      

      
        2

        
          

        

      

      
        
        

      

       

    

    “Arrangers”
      means Wachovia Capital Markets, LLC and Citigroup Global Markets
      Inc.

     

    “Assignment
      and Assumption” is defined in Section 11.02(b)(ii).

     

    “Base
      Indenture 2001” has the meaning set forth in the definition of the term “Senior
      Notes”.

     

    “Base
      Indenture 2002” has the meaning set forth in the definition of the term “Senior
      Notes”.

     

    “Base
      Indenture 2004” has the meaning set forth in the definition of the term “Senior
      Notes”.

     

    “Board”
means
      the Board of Governors of the Federal Reserve System of the United States of
      America.

     

    “BMC”
      means Beazer Mortgage Corporation, a Delaware corporation and Wholly-Owned
      Subsidiary of the Borrower.

     

    “Borrowing”
      means a borrowing consisting of Loans of the same type made, renewed or
      converted on the same day.

     

    “Borrowing
      Base” means, with respect to an Inventory Valuation Date for which it is to be
      determined, an amount equal to the sum of the following unencumbered assets
      of
      the Borrower and the Guarantors: (i) an amount equal to (a) one hundred percent
      (100%) of the Unrestricted Cash minus (b) $20,000,000.00, (ii) one-hundred
      percent (100%) of the book value of Receivables, (iii) ninety percent (90%)
      of
      the book value of Housing Units Under Contract, (iv) seventy-five percent (75%)
      of the book value of Speculative Housing Units, (v) seventy percent (70%) of
      the
      book value of Finished Lots, and (vi) fifty percent (50%) of the book value
      of
      Lots under Development (subject to the limitation set forth below).
      Notwithstanding the foregoing, the Borrowing Base shall not include any amounts
      under clause (vi) above to the extent that the sum of such amounts exceeds
      thirty-five percent (35%) of the total Borrowing Base. The term “unencumbered”
means that such asset is not subject to any Lien (except for Liens permitted
      under Sections 6.01(1), (2) or (6) and except for Liens permitted under Section
      6.01(5) in excess of the amount of such Judgment or similar Lien permitted
      under
      Section 6.01(5)).

     

    “Borrowing
      Base Availability” means, on any date, the excess (if any) of the Borrowing Base
      as most recently determined in accordance with this Agreement over the amount
      of
      Borrowing Base Debt on such date.

     

    “Borrowing
      Base Certificate” means a written certificate in a form acceptable to the
      Required Lenders setting forth the amount of the Borrowing Base with respect
      to
      the calendar month most recently completed, certified as true and correct by
      the
      Chief Financial Officer of the Borrower.

     

    
      
        
        

      

      
        3

        
          

        

      

      
        
        

      

       

    

    “Borrowing
      Base Debt” means the sum of all Consolidated Debt, excluding (i) Secured Debt,
      (ii) Debt that is subordinated to the Obligations to the satisfaction of the
      Required Lenders, (iii) Performance Letters of Credit (to the extent not drawn
      upon), (iv) performance bonds (to the extent not drawn upon) and (v) Debt of
      any
      Joint Venture.

     

    “Business
      Day” means (i) with respect to any Borrowing, payment or rate selection of
      Eurodollar Loans, a day (other than a Saturday or Sunday) on which banks
      generally are open in Charlotte, North Carolina and New York City for the
      conduct of substantially all of their commercial lending activities and on
      which
      dealings in United States dollars are carried on in the London interbank market
      and (ii) for all other purposes, a day (other than a Saturday or Sunday) on
      which banks generally are open in Charlotte, North Carolina and New York City
      for the conduct of substantially all of their commercial lending
      activities.

     

    “Capital
      Lease” means all leases which have been or should be capitalized on the books of
      the lessee in accordance with GAAP.

     

    “Cash
      Equivalents” means:

     

    (a) marketable
      obligations with a maturity of 360 days or less issued or directly and fully
      guaranteed or insured by the United States of America or any agency or
      instrumentality thereof (provided that the full faith and credit of the United
      States of America is pledged in support thereof);

     

    (b) demand
      and time deposits and certificates of deposit or acceptances with a maturity
      of
      180 days or less of any financial institution that is a member of the Federal
      Reserve System having combined capital and surplus and undivided profits not
      less that $500 million and is assigned at least a “B” rating by Thomson
      Financial BankWatch;

     

    (c) commercial
      paper maturing no more than 180 days from the date of creation thereof issued
      by
      a corporation that is not the Borrower or an Affiliate of the Borrower, and
      is
      organized under the laws of any state of the United States of America or the
      District of Columbia and rated at least A-1 by S&P or at least P-1 by
      Moody's;

     

    (d) repurchase
      obligations with a term of not more than ten days for underlying securities
      of
      the types described in clause (a) above entered into with any commercial bank
      meeting the specifications of clause (b) above; and

     

    (e) investments
      in money market or other mutual funds substantially all of whose assets comprise
      securities of the types described in clauses (a) through (d) above.

     

    “Change
      of Control” means any of the following: (i) the sale, lease, conveyance or other
      disposition of all or substantially all of the assets of the Borrower or (except
      for an Internal Reorganization) of a Significant Guarantor or Significant
      Subsidiary, as an entirety or substantially as an entirety to any Person or
      “group” (within the meaning of Section 13(d)(3) of the Exchange Act) in one or a
      series of transactions; (ii) the acquisition by any Person or group of fifty
      percent (50%) or more of the aggregate voting power of all classes of Common
      Equity of the Borrower or (except for an Internal Reorganization) of a
      Significant Guarantor or Significant Subsidiary in one transaction or a series
      of related transactions; (iii) 

     

    
      
        
        

      

      
        4

        
          

        

      

      
        
        

      

    

     

    the
      liquidation or dissolution of the Borrower or (except for an Internal
      Reorganization) of a Significant Guarantor or Significant Subsidiary; (iv)
      any
      transaction or a series of related transactions (as a result of a tender offer,
      merger, consolidation or otherwise but excluding an Internal Reorganization)
      that results in, or that is in connection with, (a) any Person or group
      acquiring “beneficial ownership” (as defined in Rule 13d-3 under the Exchange
      Act), directly or indirectly, of fifty percent (50%) or more of the aggregate
      voting power of all classes of Common Equity of the Borrower, a Significant
      Guarantor or a Significant Subsidiary, or of any Person or group that possesses
      “beneficial ownership” (as defined in Rule 13d-3 under the Exchange Act),
      directly or indirectly, of fifty percent (50%) or more of the aggregate voting
      power of all classes of Common Equity of the Borrower, a Significant Guarantor
      or a Significant Subsidiary, or (b) less than fifty percent (50%) (measured
      by
      the aggregate voting power of all classes) of the Common Equity of the Borrower
      being registered under Section 12(b) or 12(g) of the Exchange Act; (v) a
      majority of the Board of Directors of the Borrower, a Significant Guarantor
      or a
      Significant Subsidiary, not being comprised of persons who (a) were members
      of
      the Board of Directors of such Borrower, Significant Guarantor or Significant
      Subsidiary, as of the date of this Agreement (“Original Directors”), or (b) were
      nominated for election or elected to the Board of Directors of such Borrower,
      Significant Guarantor, or Significant Subsidiary, with the affirmative vote
      of
      at least a majority of the directors who themselves were Original Directors
      or
      who were similarly nominated for election or elected; or (vi) with respect
      to
      any Significant Guarantor or Significant Subsidiary which is not a corporation,
      any loss by the Borrower of the right or power directly, or indirectly through
      one or more intermediaries, to control the activities of any such Significant
      Guarantor or Significant Subsidiary. Nothing herein contained shall modify
      or
      otherwise affect the provisions of Section 6.06.

     

    “Closing
      Date” means the date on which the conditions to the first advance of the Loans
      set forth in Article III are satisfied.

     

    “Code”
      means the Internal Revenue Code of 1986, as amended from time to time, and
      the
      regulations and published interpretations thereof.

     

    “Collateral
      Shortfall Amount” has the meaning assigned to that term in Section
      8.01.

     

    “Commitment”
      means, for each of the Lenders, the obligation of such Lender to make Loans
      and
      to purchase participations in Facility Letters of Credit in the aggregate not
      exceeding the amount set forth in Schedule I hereto as its “Commitment,” as such
      amount may be decreased from time to time pursuant to the terms or increased
      pursuant to Section 2.02.2; provided,
      however,
      that
      the Commitment of a Lender may not be increased without its prior written
      approval.

     

    “Commitment
      and Acceptance” is defined in Section 2.02.2(a).

     

    “Common
      Equity” of any Person means any and all shares, rights to purchase, warrants or
      options (whether or not currently exercisable), participations, or other
      equivalents of or interests in (however designated) the equity (which includes,
      but is not limited to, common stock, preferred stock and partnership and joint
      venture interests) of such Person (excluding any debt securities convertible
      into, or exchangeable for, such equity) to the extent that the foregoing is
      entitled to (i) vote in the election of directors of such Person or (ii) if
      such
      Person is not a corporation, vote or otherwise participate in the selection
      of
      the governing body, partners, managers or other persons that will control the
      management and policies of such Person.

     

    
      
        
        

      

      
        5

        
          

        

      

      
        
        

      

       

    

    “Commonly
      Controlled Entity” means an entity, whether or not incorporated, which is under
      common control with the Borrower within the meaning of Section 414(b) or 414(c)
      of the Code.

     

    “Consolidated
      Debt” means the Debt of the Borrower and its Subsidiaries determined on a
      consolidated basis (but shall not include Debt of any Subsidiary which is not
      a
      Guarantor, except to the extent that such Debt is guaranteed by the Borrower
      or
      a Guarantor).

     

    “Consolidated
      Subordinated Debt” means, as of any date, all Consolidated Debt, the payment of
      which is, either expressly by its terms or otherwise, subordinated to payment
      of
      the Obligations to the satisfaction of the Required Lenders.

     

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

     

    “Consolidated
      Tangible Net Worth” of the Borrower means, at any date, the consolidated
      stockholders’ equity of the Borrower determined in accordance with GAAP, less
      Intangible Assets, all determined as of such date.

     

    “Debt”
      means, without duplication, with respect to any Person (1) indebtedness or
      liability for borrowed money, including, without limitation, subordinated
      indebtedness (other than trade accounts payable and accruals incurred in the
      ordinary course of business); (2) obligations evidenced by bonds, debentures,
      notes, or other similar instruments; (3) obligations for the deferred purchase
      price of property (including, without limitation, seller financing of any
      Inventory) or services, provided,
      however,
      that
      Debt shall not include obligations with respect to options to purchase real
      property that have not been exercised; (4) obligations as lessee under Capital
      Leases to the extent that the same would, in accordance with GAAP, appear as
      liabilities in the Borrower’s consolidated balance sheet; (5) current
      liabilities in respect of unfunded vested benefits under Plans and incurred
      withdrawal liability under any Multiemployer Plan; (6) reimbursement obligations
      under letters of credit (including contingent obligations with respect to
      letters of credit not yet drawn upon); (7) obligations under acceptance
      facilities; (8) all guaranties, endorsements (other than for collection or
      deposit in the ordinary course of business), and other contingent obligations
      to
      purchase, to provide funds for payment, to supply funds to invest in any other
      Person or entity, or otherwise to assure a creditor against loss, provided,
      however, that “Debt” shall not include guaranties of performance obligations;
      (9) obligations secured by any Liens on any property of such Person, whether
      or
      not the obligations have been assumed; (10) net liabilities under interest
      rate
      swap, exchange or cap agreements (valued as the termination value thereof,
      computed in accordance with a method approved by the International Swaps and
      Derivatives Association and agreed to by such Person in the applicable
      agreement); and (11) such Person’s pro rata share of the obligations and
      liabilities (described in (1) through (10) above) of any Joint Venture in which
      such Person holds an interest.

     

    
      
        
        

      

      
        6

        
          

        

      

      
        
        

      

       

    

    “Default”
      means any of the events specified in Section 8.01, whether or not any
      requirement for the giving of notice, the lapse of time, or both, or any other
      condition, has been satisfied.

     

    “Dollars”
      and the sign “$” mean lawful money of the United States of America.

     

    “EBITDA”
      means, for any period, on a consolidated basis for the Borrower and its
      Subsidiaries (other than those Subsidiaries that are not Guarantors), the sum
      of
      the amounts for such period of (i) Net Income (but excluding from such Net
      Income for the applicable period any income derived from any Investment in
      a
      Joint Venture referred to in Section 6.07(10) to the extent that such income
      exceeds the cash distributions thereof received by the Borrower or its
      Subsidiaries (other than those Subsidiaries that are not Guarantors) in such
      period), plus
      (ii)
      charges against income for foreign, federal, state and local taxes, plus
      (iii)
      Interest Expense, plus
      (iv)
      depreciation, plus
      (v)
      amortization expense, including, without limitation, amortization of goodwill
      and other intangible assets and amortization of deferred compensation expense,
      plus
      (vi)
      extraordinary losses (and all other non-cash items reducing Net Income,
      including but not limited to impairment charges for land and other long-lived
      assets and option deposit forfeitures), minus
      (vii)
      interest income, minus
      (viii)
      extraordinary gains (and any unusual gains and non-cash credits arising in
      or
      outside of the ordinary course of business not included in extraordinary gains
      that have been included in the determination of such Net Income), all determined
      in accordance with GAAP.

     

    “Entitled
      Land” means all Lots that are neither Lots under Development nor Finished
      Lots.

     

    “ERISA”
      means the Employee Retirement Income Security Act of 1974, as amended from
      time
      to time, and the regulations and published interpretations thereof.

     

    “Eurodollar
      Loan” means any Loan when and to the extent that the interest rate therefor is
      determined by reference to the Eurodollar Rate.

     

    “Eurodollar
      Rate”
means,
      with respect to a Eurodollar Loan for the relevant Interest Period, the sum
      of
      (a) the Adjusted LIBO Rate applicable to such Interest Period plus (b) the
      Applicable Eurodollar Margin.

     

    “Event
      of
      Default” means any of the events specified in Section 8.01, provided that any
      requirement for the giving of notice, the lapse of time, or both, or any other
      condition, has been satisfied.

     

    “Exchange
      Act” means the Securities Exchange Act of 1934, as amended from time to
      time.

     

    
      
        
        

      

      
        7

        
          

        

      

      
        
        

      

       

    

    “Existing
      Letters of Credit” means those Letters of Credit issued for the account of the
      Borrower prior to the date hereof and listed on Schedule II hereto.

     

    “Extension
      Request” is defined in Section 2.19(a).

     

    “Facility”
      means the revolving credit and letter of credit facilities described in Section
      2.01, together with the Swing Line facility described in Section
      2.21.

     

    “Facility
      Increase” is defined in Section 2.02.2(a).

     

    “Facility
      Letter of Credit” means (a) each Existing Letter of Credit and (b) any Letter of
      Credit issued by an Issuer for the account of the Borrower in accordance with
      Section 2.22.

     

    “Facility
      Letter of Credit Collateral Account” is defined in Section 2.22.13.

     

    “Facility
      Letter of Credit Fee” means a fee, payable with respect to each Facility Letter
      of Credit issued by an Issuer, in an amount per annum equal to the product
      of
      (i) the Applicable Letter of Credit Rate (determined as of the date on which
      the
      quarterly installment of such fee is due) and (ii) the undrawn outstanding
      amount of such Facility Letter of Credit, which fee shall be calculated in
      the
      manner provided in Section 2.22.7.

     

    “Facility
      Letter of Credit Obligations” means, at any date, the sum of (i) the aggregate
      undrawn face amount of all outstanding Facility Letters of Credit, and (ii)
      the
      aggregate amount paid by an Issuer on any Facility Letters of Credit to the
      extent (if any) not reimbursed by the Borrower or by the Lenders under Section
      2.22.4.

     

    “Facility
      Letter of Credit Sublimit” means $350,000,000.

     

    “Federal
      Funds Effective Rate” means, for each day, a fluctuating interest rate per annum
      equal to the weighted average of the rates on overnight Federal Funds
      transactions with members of the Federal Reserve System arranged by Federal
      Funds brokers, as published for such day (or, if such day is not a Business
      Day,
      for the immediately preceding Business Day) by the Federal Reserve Bank of
      New
      York, or, if such rate is not so published for any day which is a Business
      Day,
      the average of the quotations at approximately 11:00 A.M. Charlotte, North
      Carolina time on such day on such transactions received by the Agent from three
      Federal Funds brokers of recognized standing selected by the Agent in its sole
      discretion.

     

    “Financial
      Letter of Credit” means any Letter of Credit of the Borrower or a Guarantor that
      is not a Performance Letter of Credit.

     

    “Finished
      Lots” means Lots in respect of which a building permit, from the applicable
      local governmental authority, has been or could be obtained; provided,
      however,
      that
      the term “Finished Lots” shall not include any Land upon which the construction
      of a Housing Unit has commenced.

     

    “Fitch”
      means Fitch, Inc.

     

    
      
        
        

      

      
        8

        
          

        

      

      
        
        

      

       

    

    “GAAP”
      means generally accepted accounting principles in the United States in effect
      from time to time (subject to the provisions of Section 1.02).

     

    “Guarantor”
      means (a) the Subsidiaries of Borrower identified on Schedule
      III
      hereto
      and (b) any Person that, pursuant to a Supplemental Guaranty, guarantees the
      Obligations.

     

    “Guaranty”
      means (a) the guaranty of the Obligations in the form attached hereto as
Exhibit
      A
      or (b) a
      Supplemental Guaranty.

     

    “Housing
      Unit” means a dwelling, including the Land on which such dwelling is located,
      whether such dwelling is a Single Family Housing Unit or a Multifamily Housing
      Unit (including condominiums but excluding mobile homes), which dwelling is
      either under construction or completed and is (or, upon completion of
      construction thereof, will be) available for sale; the term “Housing Unit”
includes a Speculative Housing Unit.

     

    “Housing
      Unit Closing” means a closing of the sale of a Housing Unit by the Borrower or a
      Subsidiary (including any company or other entity acquired in an Acquisition
      by
      the Borrower or a Subsidiary) to a bona fide
      purchaser for value that is not an Affiliate.

     

    “Housing
      Unit Under Contract” means a Housing Unit owned by the Borrower or a Subsidiary
      as to which the Borrower or such Subsidiary has a bona fide
      contract
      of sale, in a form customarily employed by the Borrower or such Subsidiary
      and
      reasonably satisfactory to the Agent, entered into not more than (a) 15 months
      prior to the date of determination (in the case of Single Family Housing Units)
      or (b) 24 months prior to the date of determination (in the case of Multifamily
      Housing Units), in either case with a Person who is not an Affiliate, under
      which contract no defaults then exist and not less than $1,000.00 toward the
      purchase price has been paid; provided,
      however,
      that in
      the case of any Housing Unit the purchase of which is to be financed in whole
      or
      in part by a loan insured by the Federal Housing Administration or guaranteed
      by
      the Veterans Administration, the required minimum down payment shall be the
      amount (if any) required under the rules of the relevant agency.

     

    “Incur”
      means to, directly or indirectly, create, incur, assume, guarantee, extend
      the
      maturity of or otherwise become liable with respect to any Debt; provided,
      however, that neither the accrual of interest (whether such interest is payable
      in cash or kind) nor the accretion of original issue discount shall be
      considered an Incurrence of Debt.

     

    “Intangible
      Assets” means, at any time, the amount (to the extent reflected in determining
      consolidated stockholders equity of the Borrower and its Subsidiaries) of (i)
      Investments in any Subsidiaries that are not Guarantors and (ii) all unamortized
      debt discount and expense, unamortized deferred charges, good will, patents,
      trademarks, service marks, trade names, copyrights and all other items which
      would be treated as intangibles on a consolidated balance sheet of the Borrower
      and its Subsidiaries prepared in accordance with GAAP.

     

    “Interest
      Coverage Ratio” means, for any period, the ratio of (a) EBITDA to (b) the sum
      (on a consolidated basis for the Borrower and its Subsidiaries (other than
      those
      Subsidiaries that are not Guarantors)) of all interest incurred (whether
      expensed or capitalized), less the amount of interest income for such
      period.

     

    
      
        
        

      

      
        9

        
          

        

      

      
        
        

      

       

    

    “Interest
      Deficit” is defined in Section 2.08(b).

     

    “Interest
      Expense” means, for any period, the total interest expense of the Borrower and
      its Subsidiaries (other than those Subsidiaries that are not Guarantors),
      whether paid directly or amortized through cost of sales (including the interest
      component of Capital Leases). Notwithstanding that GAAP may otherwise provide,
      the Borrower shall not be required to include in Interest Expense the amount
      of
      any premium paid to prepay Debt.

     

    “Interest
      Period”
means,
      with respect to any Eurodollar Loan, the period commencing on the date of such
      Eurodollar Loan and ending on the numerically corresponding day in the calendar
      month that is one, two, three or six months thereafter, as the Borrower may
      elect; provided,
      that
      (i) if any Interest Period would end on a day other than a Business Day, such
      Interest Period shall be extended to the next succeeding Business Day unless,
      in
      the case of a Eurodollar Loan only, such next succeeding Business Day would
      fall
      in the next calendar month, in which case such Interest Period shall end on
      the
      next preceding Business Day and (ii) any Interest Period pertaining to a
      Eurodollar Loan that commences on the last Business Day of a calendar month
      (or
      on a day for which there is no numerically corresponding day in the last
      calendar month of such Interest Period) shall end on the last Business Day
      of
      the last calendar month of such Interest Period. For purposes, the date of
      a
      Eurodollar Loan initially shall be the date on which such Eurodollar Loan is
      made and thereafter shall be the effective date of the most recent conversion
      or
      continuation of such Eurodollar Loan.

     

    “Internal
      Reorganization” means any reorganization between or among the Borrower and any
      Subsidiary or Subsidiaries or between or among any Subsidiary and one or more
      other Subsidiaries or any combination thereof by way of liquidations, mergers,
      consolidations, conveyances, assignments, sales, transfers and other
      dispositions of all or substantially all of the assets of a Subsidiary (whether
      in one transaction or in a series of transactions); provided that
      (a) the
      Borrower shall preserve and maintain its status as a validly existing
      corporation and (b) all assets, liabilities, obligations and guarantees of
      any
      Subsidiary party to such reorganization will continue to be held by such
      Subsidiary or be assumed by the Borrower or a Wholly-Owned Subsidiary of the
      Borrower.

     

    “Inventory”
      means all Housing Units, Lots, goods, merchandise and other personal property
      wherever located to be used for or incorporated into any Housing
      Unit.

     

    “Inventory
      Valuation Date” means the last day of the most recent calendar month of the
      Borrower with respect to which the Borrower is required to have delivered a
      Borrowing Base Certificate pursuant to Section 5.08(6).

     

    “Investment”
      has the meaning provided therefor in Section 6.07. The amount of any Investment
      shall include (a) in the case of any loan or advance, the outstanding amount
      of
      such loan or advance and (b) in the case of any equity Investment, the amount
      of
      the “net equity investment” as determined in accordance with GAAP.

     

    “Issuance
      Date” means the date on which a Facility Letter of Credit is issued, amended or
      extended.

     

    
      
        
        

      

      
        10

        
          

        

      

      
        
        

      

       

    

    “Issuer”
      means, with respect to each Existing Letter of Credit, the Issuer thereof
      identified in Schedule
      II,
      and
      with respect to each Facility Letter of Credit issued on or after the Closing
      Date, JPMorgan Chase Bank, N.A., PNC Bank, National Association, Wachovia Bank,
      or such other Lender selected by the Borrower with the approval of the Agent,
      to
      issue such Facility Letter of Credit, provided
      such
      other Lender consents to act in such capacity.

     

    “Joint
      Venture” means any Person (other than a Subsidiary) in which the Borrower or a
      Subsidiary holds any stock, partnership interest, joint venture interest,
      limited liability company interest or other equity interest.

     

    “Land”
      means land owned by the Borrower or a Subsidiary, which land is being developed
      or is held for future development or sale.

     

    “Lenders”
      means each of the Persons listed on Schedule
      I
      and any
      other Person that shall have become a party hereto pursuant to a Commitment
      and
      Acceptance or pursuant to an Assignment and Assumption, other than any such
      Person that ceases to be a party hereto pursuant to an Assignment and
      Assumption.

     

    “Lending
      Office” means, with respect to any Lender, the Lending Office of such Lender (or
      of an affiliate of such Bank) heretofore designated in writing by such Lender
      to
      the Agent or such other office or branch of such Lender (or of an affiliate
      of
      such Lender) as that Lender may from time to time specify to the Borrower and
      the Agent as the office or branch at which its Loans (or Loans of a type
      designated in such notice) are to be made and maintained.

     

    “Letter
      of Credit” of a Person means a letter of credit or similar instrument which is
      issued by a financial institution upon the application of such Person or upon
      which such Person is an account party or for which such Person is in any way
      liable.

     

    “Leverage
      Ratio” means, as of any date, the ratio of (a) an amount equal to (i)
      Consolidated Debt minus (ii) the excess (if any) of (A) the average of the
      month-end balances of Unrestricted Cash for the fiscal quarter then, or most
      recently, ended, over (B) $20,000,000 to (b) Consolidated Tangible Net
      Worth.

     

    “LIBO
      Rate”
means,
      with respect to any Eurodollar Loan for any Interest Period, the rate appearing
      on Reuters Screen LIBOR01 Page, or on any successor or substitute page of such
      service, or any successor to or substitute for such service, providing rate
      quotations comparable to those currently provided on such page of such service,
      as determined by the Agent from time to time for purposes of providing
      quotations of interest rates applicable to dollar deposits in the London
      interbank market, at approximately 11:00 a.m., London time, two Business Days
      prior to the commencement of such Interest Period, as the rate for dollar
      deposits with a maturity comparable to such Interest Period. In the event that
      such rate is not available at such time for any reason, then the “LIBO
      Rate”
with
      respect to such Eurodollar Loan for such Interest Period shall be the rate
      at
      which dollar deposits of $5,000,000 and for a maturity comparable to such
      Interest Period are offered by the principal London office of the Agent in
      immediately available funds in the London interbank market at approximately
      11:00 a.m., London time, two Business Days prior to the commencement of such
      Interest Period.

     

    
      
        
        

      

      
        11

        
          

        

      

      
        
        

      

       

    

    “Lien”
      means any mortgage, deed of trust, pledge, security interest, hypothecation,
      assignment, deposit arrangement, encumbrance, lien (statutory or other), or
      preference, priority, or other security agreement or preferential arrangement,
      charge, or encumbrance of any kind or nature whatsoever (including, without
      limitation, any conditional sale or other title retention agreement, any
      financing lease having substantially the same economic effect as any of the
      foregoing, and the filing of any financing statement under the Uniform
      Commercial Code or comparable law of any jurisdiction to evidence any of the
      foregoing).

     

    “Loan”
      means, with respect to a Lender, a Loan made by such Lender pursuant to Section
      2.01.1 and any conversion or continuation thereof and, unless the context
      otherwise indicates, shall include Swing Loans made pursuant to Section
      2.21.

     

    “Loan
      Document(s)” means this Agreement, the Notes, the Guaranties, the Reimbursement
      Agreements, and any and all documents delivered hereunder or pursuant
      hereto.

     

    “Lots”
      means all Land owned by the Borrower and/or a Subsidiary which is zoned by
      the
      municipality in which such real property is located for residential building
      and
      use, and with respect to which the Borrower or such Subsidiary has obtained
      all
      necessary approvals for its subdivision for Housing Units; provided,
      however,
      that
      the term “Lots” shall not include any Land upon which the construction of a
      Housing Unit has commenced.

     

    “Lots
      under Development” means Lots with respect to which construction of streets or
      other subdivision improvements has commenced but which are not Finished
      Lots.

     

    “Minimum
      Consolidated Tangible Net Worth” has the meaning assigned to that term in
      Section 7.01.

     

    “Moody’s”
      means Moody’s Investors Service, Inc.

     

    “Multiemployer
      Plan” means a plan described in Section 4001(a)(3) of ERISA in respect of which
      the Borrower, a Subsidiary or a Commonly Controlled Entity is an “employer” as
      defined in Section 3(5) of ERISA.

     

    “Multifamily
      Housing Unit” means any
      residential dwelling that has twenty (20) or more units or four (4) or more
      stories.

     

    “Net
      Income” means, for any period, the net earnings (or loss) after taxes of the
      Borrower and its Subsidiaries on a consolidated basis for such
      period.

     

    “New
      Lender” means a Lender or other entity (in each case approved by the Agent,
      which approval shall not be unreasonably withheld) that elects, upon request
      by
      Borrower, to issue a Commitment or, in the case of an existing Lender, to
      increase its existing Commitment, pursuant to Section 2.02.2.

     

    “Note”
      means a promissory note in substantially the form of Exhibit
      B
      hereto,
      executed and delivered by the Borrower payable to the order of a Lender in
      the
      amount of its Commitment, including any amendment, modification, restatement,
      renewal or replacement of such promissory note.

     

    
      
        
        

      

      
        12

        
          

        

      

      
        
        

      

       

    

    “Obligations”
      means (a) the due and punctual payment of principal of and interest on the
      Loans
      and the Notes, (b) the due and punctual payment of the Facility Letter of Credit
      Obligations, and (c) the due and punctual payment of fees, expenses,
      reimbursements, indemnifications and other present and future monetary
      obligations of the Borrower and each Guarantor to the Lenders or to any Lender,
      the Agent, any Issuer or any indemnified party, in each case arising under
      the
      Loan Documents.

     

    “Original
      Credit Agreement” means that certain Credit Agreement dated as of August 22,
      2005, among Borrower, JPMorgan Chase Bank, N.A. and the lenders party thereto,
      as amended from time to time.

     

    “Participant”
      is defined in Section 11.03.

     

    “PBGC”
      means the Pension Benefit Guaranty Corporation or any entity succeeding to
      any
      or all of its functions under ERISA.

     

    “Performance
      Letter of Credit” means any Letter of Credit of the Borrower or a Guarantor that
      is issued for the benefit of a municipality, other governmental authority,
      utility, water or sewer authority, or other similar entity for the purpose
      of
      assuring such beneficiary of the Letter of Credit of the proper and timely
      completion of construction work.

     

    “Permitted
      Acquisition” means any Acquisition (other than by means of a hostile takeover,
      hostile tender offer or other similar hostile transaction) of a business or
      entity engaged primarily in the business of home building; provided that,
      immediately before and after giving effect to such Acquisition, no Default
      or
      Event of Default has occurred and is continuing.

     

    “Person”
      means an individual, partnership, corporation, business trust, joint stock
      company, trust, limited liability company, unincorporated association, joint
      venture, governmental authority, or other entity of whatever
      nature.

     

    “Plan”
      means any pension plan which is covered by Title IV of ERISA and in respect
      of
      which (a) the Borrower or a Subsidiary or a Commonly Controlled Entity is an
      “employer” as defined in Section 3(5) of ERISA and (b) the Borrower or a
      Subsidiary has any material liability; provided,
      however,
      that
      the term “Plan” shall not include any Multiemployer Plan.

     

    “Prime
      Rate” means that interest rate so denominated and set by Wachovia Bank from time
      to time as an interest rate basis for borrowings. The Prime Rate is but one
      of
      several interest rate bases used by Wachovia Bank. Wachovia Bank lends at
      interest rates above and below the Prime Rate.

     

    “Prohibited
      Transaction” means any transaction set forth in Section 406 of ERISA or Section
      4975 of the Code that could subject the Borrower or any Subsidiary to any
      material liability.

     

    
      
        
        

      

      
        13

        
          

        

      

      
        
        

      

       

    

    “Pro
      Rata
      Share” means, at any time for any Lender, the ratio that such Lender’s
      Commitment bears to the Aggregate Commitment; provided,
      however,
      that if
      the Aggregate Commitment has terminated or been terminated in full, the Pro
      Rata
      Share shall be the ratio that (x) the sum of such Lender’s outstanding Loans and
      Facility Letter of Credit Obligations bears to (y) the sum of all outstanding
      Loans and Facility Letter of Credit Obligations; and provided,
      further,
      that
      this definition is subject to the provisions of Section 2.02.2(c) (if and when
      applicable).

     

    “Quarterly
      Payment Date” means October 1, 2007 and the first day of each January, April,
      July and October thereafter.

     

    “Ratings”
      is defined in Section 2.05(a).

     

    “Receivables”
      means the net proceeds payable to, but not yet received by, the Borrower or
      a
      Subsidiary following a Housing Unit Closing.

     

    “Refinancing
      Debt” means Debt that refunds, refinances or extends any applicable Debt
      (“Refinanced Debt”) but only to the extent that (i) the Refinancing Debt is
      subordinated to or pari
      passu
      with the
      Obligations to the same extent as such Refinanced Debt, if at all, (ii) such
      Refinancing Debt is in an aggregate amount that is equal to or less than the
      sum
      of (A) the aggregate amount then outstanding under the Refinanced Debt,
plus
      (B)
      accrued and unpaid interest on such Refinanced Debt, plus
      (C)
      reasonable fees and expenses incurred in obtaining such Refinancing Debt, it
      being understood that this clause (ii) shall not preclude the Refinancing Debt
      from being a part of a Debt financing that includes other or additional Debt
      otherwise permitted herein, (iii) such Refinancing Debt is Incurred by the
      same
      Person that initially Incurred such Refinanced Debt or by another Person of
      which the Person that initially Incurred such Refinanced Debt is a Subsidiary,
      and (iv) such Refinancing Debt is Incurred within 60 days after such Refinanced
      Debt is so refunded, refinanced or extended.

     

    “Register”
      is defined in Section 10.17.

     

    “Regulation
      D” means Regulation D of the Board of Governors of the Federal Reserve System
      as
      from time to time in effect and any successor thereto or other regulation or
      official interpretation of said Board of Governors relating to reserve
      requirements applicable to member banks of the Federal Reserve
      System.

     

    “Regulation
      U” means Regulation U of the Board of Governors of the Federal Reserve System
      as
      from time to time in effect and any successor or other regulation or official
      interpretation of said Board of Governors relating to the extension of credit
      by
      banks for the purpose of purchasing or carrying margin stocks applicable to
      member banks of the Federal Reserve System.

     

    “Regulation
      X” means Regulation X of the Board of Governors of the Federal Reserve System
      as
      from time to time in effect and any successor or other regulation or official
      interpretation of said Board of Governors relating to the extension of credit
      by
      foreign lenders for the purpose of purchasing or carrying margin stock (as
      defined therein).

     

    
      
        
        

      

      
        14

        
          

        

      

      
        
        

      

       

    

    “Reimbursement
      Agreement” means, with respect to a Facility Letter of Credit, such form of
      application therefor and form of reimbursement agreement therefor (whether
      in a
      single or several documents, taken together) as the applicable Issuer may employ
      in the ordinary course of business for its own account, with the modifications
      thereto as may be agreed upon by such Issuer and the Borrower and as are not
      materially adverse (in the reasonable judgment of such Issuer and the Agent)
      to
      the interests of the Lenders; provided,
      however,
      in the
      event of any conflict between the terms of any Reimbursement Agreement and
      this
      Agreement, the terms of this Agreement shall control.

     

    “Rejecting
      Lender” is defined in Section 2.19(a).

     

    “Rejecting
      Lender’s Termination Date” is defined in Section 2.19(a).

     

    “Replacement
      Lender” is defined in Section 2.20.

     

    “Reportable
      Event” means any of the events set forth in Section 4043 of ERISA with respect
      to a Plan (excluding any such event with respect to which the PBGC has waived
      the 30-day notice requirement).

     

    “Required
      Lenders” means Lenders whose Pro Rata Shares are equal to or greater than
      66-2/3%.

     

    “S&P”
      means Standard & Poor’s Rating Services.

     

    “Secured
      Debt” means all Debt of the Borrower or any of its Subsidiaries (excluding Debt
      owing to the Borrower or any of its Subsidiaries) that is secured by a Lien
      on
      assets of the Borrower or any of its Subsidiaries.

     

    “Senior
      Debt” means the Senior Notes or, if the Senior Notes are refinanced, the
      Refinancing Debt with respect thereto.

     

    “Senior
      Indentures” means the Base Indenture 2001, the Base Indenture 2002, the Base
      Indenture 2004, the Supplemental Indentures and any other Indenture hereafter
      entered into by the Borrower pursuant to which the Borrower Incurs any
      Refinancing Debt with respect to any of the Senior Notes.

     

    “Senior
      Notes” means (i) the 8-3/8% Senior Notes due 2012 of the Borrower issued in the
      original principal amount of $350,000,000, pursuant to the Indenture dated
      April
      17, 2002 (the
      “Base Indenture 2002”)
      and
      First Supplemental Indenture dated April 17, 2002, (ii) the 8-5/8% Senior Notes
      due 2011 of the Borrower issued in the original principal amount of $200,000,000
      pursuant to the Indenture dated May 21, 2001 (the
      “Base Indenture 2001”)
      and
      First Supplemental Indenture dated May 21, 2001, (iii) the 61⁄2% Senior Notes due
      2013 of the Borrower issued in the original principal amount of $200,000,000
      pursuant to the Base Indenture 2002 and Second Supplemental Indenture dated
      November 13, 2003, (iv) the 4-5/8% Convertible Senior Notes due 2024 of the
      Borrower issued in the original principal amount of $180,000,000 pursuant to
      the
      Indenture dated June 8, 2004 (the “Base
      Indenture 2004”),
      (v)
      the 6-7/8% Senior Notes due 2015 of the Borrower issued in the original
      principal amount of $350,000,000 pursuant to the Base Indenture 2002 and Fifth
      Supplemental Indenture dated June 8, 2005, and (vi) the 8.125% Senior Notes
      due
      2016 of the Borrower issued in the original principal amount of $275,000,000
      pursuant to the Base Indenture 2002 and the Eighth Supplemental Indenture dated
      June 6, 2006.

     

    
      
        
        

      

      
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    “Significant
      Guarantor” means, at any date of determination thereof, any Guarantor that
      (together with its Subsidiaries) accounts for ten percent (10%) or more of
      the
      Consolidated Tangible Assets as of the last day of the most recent fiscal
      quarter then ended and ten percent (10%) or more of the consolidated net
      revenues for the twelve-month period ending on the last day of the most recent
      fiscal quarter then ended, in each case of the Borrower and its Subsidiaries
      taken as a whole. Such percentage shall be determined on the basis of financial
      reports that shall be available not later than 25 days (or, in the case of
      the
      last fiscal quarter of the fiscal year, 35 days) following the end of such
      fiscal quarter.

     

    “Significant
      Subsidiary” means, at any date of determination thereof, any Subsidiary that
      (together with its Subsidiaries) accounts for five percent (5%) or more of
      the
      Consolidated Tangible Assets as of the last day of the most recent fiscal
      quarter then ended and five percent (5%) or more of the consolidated net
      revenues for the twelve-month period ending on the last day of the most recent
      fiscal quarter then ended, in each case of the Borrower and its Subsidiaries
      taken as a whole. Such percentage shall be determined on the basis of financial
      reports that shall be available not later than 25 days (or, in the case of
      the
      last fiscal quarter of the fiscal year, 35 days) following the end of such
      fiscal quarter.

     

    “Single
      Family Housing Unit” means any residential dwelling that is not a Multifamily
      Housing Unit.

     

    “Speculative
      Housing Unit” means any Housing Unit owned by the Borrower or a Subsidiary that
      is not a Housing Unit Under Contract.

     

    “Statutory
      Reserve Rate”
means
      a
      fraction (expressed as a decimal), the numerator of which is the number one
      and
      the denominator of which is the number one minus the aggregate of the maximum
      reserve percentages (including any marginal, special, emergency or supplemental
      reserves) expressed as a decimal established by the Board to which the Agent
      is
      subject for eurocurrency funding (currently referred to as “Eurocurrency
      Liabilities” in Regulation D of the Board). Such reserve percentages shall
      include those imposed pursuant to such Regulation D. Eurodollar Loans shall
      be
      deemed to constitute eurocurrency funding and to be subject to such reserve
      requirements without benefit of or credit for proration, exemptions or offsets
      that may be available from time to time to any Lender under such Regulation
      D or
      any comparable regulation. The Statutory Reserve Rate shall be adjusted
      automatically on and as of the effective date of any change in any reserve
      percentage.

     

    “Subsidiary”
      means, as to the Borrower or a Guarantor, in the case of a corporation, a
      corporation of which shares of stock having ordinary voting power (other than
      stock having such power only by reason of the happening of a contingency) to
      elect a majority of the board of directors or other managers of such corporation
      are at the time owned, or the management of which is otherwise controlled,
      directly, or indirectly through one or more intermediaries, or both, by the
      Borrower or such Guarantor, as the case may be, or in the case of an entity
      which is not a corporation, the activities of which are controlled directly,
      or
      indirectly through one or more intermediaries, or both, by the Borrower or
      such
      Guarantor, as the case may be.

     

    
      
        
        

      

      
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    “Supplemental
      Guaranty” means a Supplemental Guaranty in the form provided for in, and
      attached to, the form of Guaranty attached hereto as Exhibit
      A.

     

    “Supplemental
      Indentures” means the Supplemental Indentures identified in the definition of
      the term “Senior Notes”.

     

    “Swing
      Line Commitment” means the commitment of the Swing Line Lender to make Swing
      Line Loans pursuant to Section 2.21(a). The Swing Line Commitment is in the
      amount of $25,000,000.

     

    “Swing
      Line Lender” means Wachovia Bank or any assignee to which Wachovia Bank assigns
      the Swing Line Commitment in accordance with Section 11.02.

     

    “Swing
      Line Loan” is defined in Section 2.21(a).

     

    “Taxes”
      means any and all present or future taxes, duties, levies, imposts, deductions,
      charges or withholdings, and any and all liabilities with respect to the
      foregoing, imposed by the United States. but excluding, in the case of each
      Lender or applicable Lending Office, the Issuer and the Agent, (a) taxes imposed
      on or measured by its overall net income, and franchise taxes imposed on it,
      by
      (i) the jurisdiction under the laws of which such Lender, the Issuer or the
      Agent is incorporated or organized or (ii) the jurisdiction in which the
      Agent’s, Issuer’s or such Lender’s principal executive office or such Lender’s
      applicable Lending Office is located and (b) taxes that are in effect and would
      apply at the time such Person becomes a Lender, Issuer or Agent
      hereunder.

     

    “Termination
      Date” means July 24, 2011, subject, however, to earlier termination in whole of
      the Aggregate Commitment pursuant to the terms of this Agreement and to
      extension of such date as provided in Section 2.19.

     

    “Title
      Companies” means Security Title Insurance Company, a Vermont corporation, Beazer
      Title Agency of Arizona, LLC, an Arizona limited liability company, and Beazer
      Title Agency, LLC, a Nevada limited liability company, each of which is a
      Wholly-Owned Subsidiary of Borrower.

     

    “UHIC”
      means United Homes Insurance Corporation, a Vermont corporation and Wholly-Owned
      Subsidiary of the Borrower.

     

    “Unrestricted
      Cash” of a Person means the cash and Cash Equivalents of such Person that would
      not be identified as “restricted” on a balance sheet of such Person prepared in
      accordance with GAAP.

     

    “Wachovia
      Bank” means Wachovia Bank, National Association, a national banking
      association.

     

    
      
        
        

      

      
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    “Wholly-Owned
      Subsidiary” of any Person means (i) a Subsidiary, of which one hundred percent
      (100%) of the outstanding Common Equity (except for directors’ qualifying shares
      or certain minority interests owned by other Persons solely due to local law
      requirements that there be more than one stockholder, but which interest is
      not
      in excess of what is required for such purpose) is owned directly by such Person
      or through one or more other Wholly-Owned Subsidiaries of such Person, or (ii)
      any entity other than a corporation in which such Person, directly or
      indirectly, owns all of the outstanding Common Equity of such
      entity.

     

    Section
      1.02   Accounting
      Terms.
      (a) All
      accounting terms not specifically defined herein shall be construed in
      accordance with GAAP consistent with those applied in the preparation of the
      financial statements referred to in Section 4.04, and all financial data
      submitted pursuant to this Agreement shall be prepared in accordance with such
      principles.

     

    (b) Notwithstanding
      anything to the contrary contained in this Agreement, in determining the
      Borrower’s compliance with the provisions of Article VII hereof, GAAP shall not
      include modifications of generally accepted accounting principles that become
      effective after the date hereof.

     

    ARTICLE
      II  

    AMOUNTS
      AND TERMS OF THE LOANS

     

    Section
      2.01   The
      Facility.

     

    Section
      2.01.1   Revolving
      Credit Facility.
      (a) On
      and after the Closing Date and prior to the Termination Date, upon the terms
      and
      conditions set forth in this Agreement and in reliance upon the representations
      and warranties of the Borrower herein set forth, each Lender severally agrees
      to
      make Loans to the Borrower, provided
      that (i)
      in no event may the aggregate principal amount of all outstanding Loans
      (including, in the case of the Swing Line Lender, outstanding Swing Line Loans)
      and the Facility Letter of Credit Obligations of any Lender exceed its
      Commitment, and (ii) in no event may the sum of the aggregate principal amount
      of all outstanding Loans, (including all outstanding Swing Line Loans) and
      the
      Facility Letter of Credit Obligations exceed the Aggregate
      Commitment.

     

    (b) On
      and
      after the Closing Date and prior to the Termination Date, each Lender severally
      agrees, on the terms and conditions set forth in this Agreement and in reliance
      upon the representations and warranties of Borrower herein set forth, to
      participate in Facility Letters of Credit issued pursuant to Section 2.22 for
      the account of the Borrower, provided that
      (i)
      in no event may the aggregate principal amount of all outstanding Loans and
      Facility Letter of Credit Obligations of any Lender exceed its Commitment and
      (ii) in no event may the aggregate amount of all Facility Letter of Credit
      Obligations exceed the lesser of (A) the Facility Letter of Credit Sublimit
      and
      (B) an amount equal to the Aggregate Commitment minus the sum of all outstanding
      Loans (including all outstanding Swing Line Loans).

     

    (c) Loans
      hereunder (other than Swing Line Loans) shall be made ratably by the several
      Lenders in accordance with their respective Pro Rata Shares. Participations
      in
      Facility Letters of Credit hereunder shall be ratable among the several Lenders
      in accordance with their respective Pro Rata Shares.

     

    
      
        
        

      

      
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    (d) All
      Obligations shall be due and payable by the Borrower on the Termination Date
      unless such Obligations shall sooner become due and payable pursuant to Section
      8.01 or as otherwise provided in this Agreement.

     

    (e) Each
      Borrowing which shall not utilize the Aggregate Commitment in full shall be
      in
      an amount not less than One Million Dollars ($1,000,000) in the case of a
      Borrowing consisting of Eurodollar Loans and Five Hundred Thousand Dollars
      ($500,000) in the case of a Borrowing consisting of ABR Loans and, in either
      case, if in excess of the specified amount, in integral multiples of One Hundred
      Thousand Dollars ($100,000). Each Borrowing shall consist of a Loan made by
      each
      Lender in the proportion of its Pro Rata Share. Within the limits of the
      Aggregate Commitment, the Borrower may borrow, repay pursuant to Section 2.11,
      and reborrow Loans under this Section 2.01. On such terms and conditions, the
      Loans may be outstanding as ABR Loans or Eurodollar Loans. Each type of Loan
      shall be made and maintained at the applicable Lender’s Lending Office for such
      type of Loan. The failure of any Lender to make any requested Loan to be made
      by
      it on the date specified for such Loan shall not relieve any other Lender of
      its
      obligation (if any) to make such Loan on such date, but no Lender shall be
      responsible for the failure of any other Lender to make such Loan to be made
      by
      such other Lender. The provisions of this Section 2.01.1(e) shall not apply
      to
      Swing Line Loans.

     

    Section
      2.01.2   Borrowing
      Base.
      At any
      time at which the Borrower’s senior unsecured long-term debt does not have a
      rating of BBB- or higher from S&P or Baa3 or higher from Moody’s, (a) the
      aggregate amount of Borrowing Base Debt at any one time outstanding may not
      exceed the Borrowing Base as of the most recent Inventory Valuation Date, and
      (b) no Loan shall be made, and no Facility Letter of Credit shall be issued
      or
      amended, that would have the effect of increasing the then outstanding amount
      of
      the Borrowing Base Debt to an amount exceeding such Borrowing Base, provided
      that a Loan shall not be deemed to have increased the amount of the Borrowing
      Base Debt to the extent that the proceeds of such Loan are immediately used
      to
      repay a Swing Line Loan theretofore included in the Borrowing Base
      Debt.

     

    Section
      2.01.3   Swing
      Line Loans.
      No Loan
      shall be made at any time that any Swing Line Loan is outstanding, except for
      Loans that are used, on the day on which made, to repay in full the outstanding
      principal balance of the Swing Line Loans.

     

    Section
      2.02   Reductions
      of and Increases in Aggregate Commitment.

     

    Section
      2.02.1   Reduction
      of Aggregate Commitment.
      The
      Borrower shall have the right, upon at least three (3) Business Days’ prior
      notice to the Agent, to terminate in whole or reduce in part the unused portion
      of the Aggregate Commitment, provided
      that
      each partial reduction shall be in the amount of at least Five Million Dollars
      ($5,000,000), and provided further
      that no
      reduction shall be permitted if, after giving effect thereto, and to any
      prepayment made therewith, the sum of (i) the outstanding and unpaid principal
      amount of the Loans and (ii) the Facility Letter of Credit Obligations shall
      exceed the Aggregate Commitment. Each reduction in part of the unused portion
      of
      each Lender’s Commitment shall be made in the proportion that such Commitment
      bears to the total amount of the Aggregate Commitment. Any Commitment, once
      reduced or terminated, may not be reinstated (except as otherwise provided
      in
      Section 8.01(v)) and may not be increased (except in accordance with Section
      2.02.2).

     

    
      
        
        

      

      
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    Section
      2.02.2   Increase
      in Aggregate Commitment.

     

    (a)  Request
      for Facility Increase.
      The
      Borrower may, at any time and from time to time, request, by notice to the
      Agent, the Agent’s approval of an increase of the Aggregate Commitment (a
“Facility Increase”) within the limitations hereafter described, which request
      shall set forth the amount of each such requested Facility Increase. Within
      twenty (20) days of such request, the Agent shall advise the Borrower of its
      approval or disapproval of such request; failure to so advise the Borrower
      shall
      constitute disapproval. If the Agent approves any such Facility Increase, then
      the Aggregate Commitment may be increased (up to the amount of such approved
      Facility Increase, in the aggregate) by having one or more New Lenders increase
      the amount of their then existing Commitments or become Lenders, subject to
      and
      in accordance with this provisions of this Section 2.02.2. Any Facility Increase
      shall be subject to the following limitations and conditions: (i) any increase
      (in the aggregate) in the Aggregate Commitment, any increase in any Commitment
      and any new Commitment shall (unless otherwise agreed to by the Borrower and
      the
      Agent) not be less than $5,000,000 (and (unless otherwise agreed to by the
      Borrower and the Agent) shall be in integral multiples of $1,000,000 if in
      excess thereof); (ii) no Facility Increase pursuant to this Section 2.02.2
      shall
      increase the Aggregate Commitment to an amount in excess of $1,000,000,000;
      (iii) the Borrower and each New Lender shall have executed and delivered a
      commitment and acceptance (the “Commitment and Acceptance”) substantially in the
      form of Exhibit
      C
      hereto,
      and the Agent shall have accepted and executed the same; (iv) the Borrower
      shall
      have executed and delivered to the Agent such Note or Notes as the Agent shall
      require to reflect such Facility Increase; (v) the Borrower shall have delivered
      to the Agent opinions of counsel (substantially similar to the forms of opinions
      provided for in Section 3.01(6), modified to apply to the Facility Increase
      and
      each Note and Commitment and Acceptance executed and delivered in connection
      therewith); (vi) the Guarantors shall have consented in writing to the Facility
      Increase and shall have agreed that their Guaranties continue in full force
      and
      effect; and (vii) the Borrower and each New Lender shall otherwise have executed
      and delivered such other instruments and documents as the Agent shall have
      reasonably requested in connection with such Facility Increase. The form and
      substance of the documents required under clauses (iii) through (vii) above
      shall be fully acceptable to the Agent. The Agent shall provide written notice
      to all of the Lenders hereunder of any Facility Increase.

     

    (b)  New
      Lenders’ Loans and Participation in Facility Letters of
      Credit.
      Upon
      the effective date of any increase in the Aggregate Commitment pursuant to
      the
      provisions hereof (the “Increase Date”), which Increase Date shall be mutually
      agreed upon by the Borrower, each New Lender and the Agent, (i) such New Lender
      shall be deemed to have irrevocably and unconditionally purchased and received,
      without recourse or warranty from the Lenders, an undivided interest and
      participation in any Facility Letter of Credit then outstanding, ratably, such
      that each Lender (including each New Lender) holds a participation interest
      in
      each such Facility Letter of Credit in the amount of its then Pro Rata Share
      thereof; (ii) on such Increase Date, the Borrower shall repay all outstanding
      ABR Loans and reborrow an ABR Loan in a like amount from the Lenders (including
      the New Lender); (iii) such New Lender shall not participate in any then
      outstanding Loan that is a Eurodollar Loan; (iv) if the Borrower shall at any
      time on or after such Increase Date convert or 

     

    
      
        
        

      

      
        20

        
          

        

      

      
        
        

      

    

     

    continue
      any Loan that is a Eurodollar Loan that was outstanding on such Increase Date,
      the Borrower shall be deemed to repay such Loan on the date of the conversion
      or
      continuation thereof and then to re-borrow as a Loan a like amount on such
      date
      so that the New Lender shall make a Loan on such date in the amount of its
      Pro
      Rata Share of such Borrowing; and (v) such New Lender shall make its Pro Rata
      Share of all Loans made on or after such Increase Date (including those referred
      to in clauses (ii) and (iv) above) and shall otherwise have all of the rights
      and obligations of a Lender hereunder on and after such Increase Date.
      Notwithstanding the foregoing, upon the occurrence of a Default prior to the
      date on which such New Lender is holding its Pro Rata Share of all Loans
      hereunder, such New Lender shall, upon notice from the Agent given on or after
      the date on which the Obligations are accelerated or become due following such
      Default, pay to the Agent (for the account of the other Lenders, to which the
      Agent shall pay their ratable shares thereof upon receipt) a sum equal to such
      New Lender’s Pro Rata Share of each Loan that is a Eurodollar Loan then
      outstanding with respect to which such New Lender does not then hold an
      interest; such payment by such New Lender shall constitute an ABR Loan
      hereunder.

     

    (c)      
      Required
      Lenders.
      Solely
      for purposes of the calculation of Pro Rata Shares as used in the definition
      of
“Required Lenders,” until such time as a New Lender holds its Pro Rata Share of
      all outstanding Loans (if any), the amount of such New Lender’s new Commitment
      or the increased amount of its Commitment shall be excluded from the amount
      of
      the Commitments and Aggregate Commitment and there shall be included in lieu
      thereof at any time an amount equal to the sum of the outstanding Loans and
      the
      participation interests in Facility Letters of Credit held by such New Lender
      with respect to its new Commitment or the increased amount of its
      Commitment.

     

    (d)      
      No
      Obligation to Increase Commitment.
      Nothing
      contained herein shall constitute, or otherwise be deemed to be, a commitment
      or
      agreement on the part of the Borrower or the Agent to give or grant any Lender
      the right to increase its Commitment hereunder at any time or a commitment
      or
      agreement on the part of any Lender to increase its Commitment hereunder at
      any
      time, and no Commitment of a Lender shall be increased without its prior written
      approval.

     

    Section
      2.03   Notice
      and Manner of Borrowing.
      The
      Borrower shall give the Agent notice of any Loans under this Agreement, on
      the
      Business Day of each ABR Loan, and at least three (3) Business Days before
      each
Eurodollar
      Loan,
      specifying: (1) the date of such Loan; (2) the amount of such Loan; (3) the
      type
      of Loan (whether an ABR Loan or a Eurodollar Loan); and (4) in the case of
      a
      Eurodollar Loan, the duration of the Interest Period applicable thereto,
provided,
      however,
      that
      (a) no Interest Period may extend beyond the Termination Date and (b) not more
      than eight (8) Interest Periods for Eurodollar Loans may be outstanding at any
      one time. All notices given by the Borrower under this Section 2.03 shall be
      irrevocable and shall be given not later than 11:00 A.M. Charlotte, North
      Carolina time on the day specified above for such notice. The Agent shall notify
      each Lender of each such notice not later than noon Charlotte, North Carolina
      time on the date it receives such notice from the Borrower if such notice is
      received by the Agent at or before 11:00 A.M. Charlotte, North Carolina time.
      In
      the event such notice from the Borrower is received after 11:00 A.M. Charlotte,
      North Carolina time, it shall be treated as if received on the next succeeding
      Business Day, and the Agent shall notify each Lender of such notice as soon
      as
      practicable but not later than noon Charlotte, North Carolina time on the next
      succeeding Business Day. Not later than 2:00 P.M. Charlotte, North Carolina
      time
      on the date of such Loans, each Lender will make available to the Agent in
      immediately available funds, such Lender’s Pro Rata Share of such Loans. After
      the Agent’s receipt of such funds, on the date of such Loans and upon
      fulfillment of the applicable conditions set forth in Article III, the Agent
      will make such Loans available to the Borrower in immediately available funds
      by
      crediting the amount thereof to the Borrower’s account with the Agent. The
      provisions of this Section 2.03 shall not apply to Swing Line
      Loans.

     

    
      
        
        

      

      
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    Section
      2.04   Non-Receipt
      of Funds by Agent.
      (a)
      Unless the Agent shall have received notice from a Lender prior to the date
      (in
      the case of a Eurodollar Loan), or by 1:00 P.M. Charlotte, North Carolina time
      on the date (in the case of an ABR Loan), on which such Lender is to provide
      funds to the Agent for a Loan to be made by such Lender that such Lender will
      not make available to the Agent such funds, the Agent may assume that such
      Lender has made such funds available to the Agent on the date of such Loan
      in
      accordance with Section 2.03 and the Agent in its sole discretion may, but
      shall
      not be obligated to, in reliance upon such assumption, make available to the
      Borrower on such date a corresponding amount. If and to the extent such Lender
      shall not have given the notice provided for above and shall not have made
      such
      funds available to the Agent, such Lender agrees to repay to the Agent forthwith
      on demand such corresponding amount together with interest thereon, for each
      day
      from the date such amount is made available to the Borrower until the date
      such
      amount is repaid to the Agent, at the Federal Funds Effective Rate for three
      Business Days and thereafter at the Alternate Base Rate. If such Lender shall
      repay to the Agent such corresponding amount, such amount so repaid shall
      constitute such Lender’s applicable Loan for purposes of this Agreement. If such
      Lender does not pay such corresponding amount forthwith upon Agent’s demand
      therefor, the Agent shall promptly notify the Borrower, and the Borrower shall
      immediately pay such corresponding amount to the Agent with interest thereon,
      for each day from the date such amount is made available to the Borrower until
      the date such amount is repaid to the Agent, at the rate of interest applicable
      at the time to such proposed Loan. Nothing set forth in this Section shall
      affect the rights of the Borrower with respect to any Lender that defaults
      in
      the performance of its obligation to make a Loan hereunder.

     

    (b) Unless
      the Agent shall have received notice from the Borrower prior to the date on
      which any payment is due to the Lenders hereunder that the Borrower will not
      make such payment in full, the Agent may assume that the Borrower has made
      such
      payment in full to the Agent on such date and the Agent in its sole discretion
      may, but shall not be obligated to, in reliance upon such assumption, cause
      to
      be distributed to each Lender on such due date an amount equal to the amount
      then due such Lender. If and to the extent the Borrower shall not have so made
      such payment in full to the Agent, each Lender shall repay to the Agent
      forthwith on demand such amount distributed to such Lender together with
      interest thereon, for each day from the date such amount is distributed to
      such
      Lender until the date such Lender repays such amount to the Agent, at the
      Federal Funds Effective Rate for three Business Days and thereafter at the
      Alternate Base Rate.

     

    (c) The
      provisions of this Section 2.04 shall not apply to Swing Line
      Loans.

     

    Section
      2.05   Determination
      of Applicable Eurodollar Margin.
      (a) The
      Applicable Eurodollar Margin shall be determined by reference to the Leverage
      Ratio and the Ratings in accordance with the following pricing grid and the
      provisions of this Section 2.05:

     

    
      
        
        

      

      
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              LEVEL
                I

            	
              LEVEL
                II

            	
              LEVEL
                III

            	
              LEVEL
                IV

            	
              LEVEL
                V

            
	
              Ratings

            	
              BBB/Baa2
                

              or
                higher

            	
              BBB-/Baa3

            	
              BB+/Ba1

            	
              BB/Ba2

            	
              BB-/Ba3
                or lower or 

              one
                or less Ratings

            
	
              Leverage
                Ratio

            	
              Less
                than 1.00x

            	
              Greater
                than or equal to 1.00x and less than 1.25x

            	
              Greater
                than or equal to 1.25x and less than 1.75x

            	
               

              Greater
                than or equal to 1.75x

            	
              Greater
                than or equal to 1.75x

            
	
              Applicable
                Eurodollar Margin

            	
              0.75%

            	
              0.875%

            	
              1.125%

               

            	
              1.375%

            	
              1.625%

            

    

    

    “Ratings”
      means (i) at any time at which Moody's, S&P and Fitch all publicly announce
      ratings of the Borrower's senior unsecured long-term debt, the second highest
      of
      such three ratings and (ii) at any time at which Moody’s and S&P publicly
      announce ratings of the Borrower’s senior unsecured long-term debt but Fitch
      does not, the higher of such two ratings (i.e., lower pricing); provided,
      however, that (in the case of either clause (i) or clause (ii)) the Ratings
      shall not be at Level I or II unless the Borrower has ratings from both S&P
      and Moody’s of BBB- and Baa3 or better.

     

    In
      the
      event of a difference of one level between the Ratings and Leverage Ratio
      pricing levels, the lower pricing shall apply; if the difference is more than
      one level, the level one level lower than the higher pricing shall
      apply.

     

    The
      Applicable Eurodollar Margin shall be increased by (i) 0.125% during any fiscal
      quarter of the Borrower immediately following any fiscal quarter of the Borrower
      at the end of which the Interest Coverage Ratio, as determined in Section 7.04,
      is less than 1.75 to 1.00 but greater than or equal to 1.50 to 1.00 and (ii)
      0.35% during any fiscal quarter of the Borrower immediately following any fiscal
      quarter of the Borrower at the end of which the Interest Coverage Ratio, as
      determined in Section 7.04, is less than 1.50 to 1.00.

     

    (b) The
      Applicable Eurodollar Margin under the foregoing pricing grid shall be
      determined (i) with reference to the Leverage Ratio as of the last day of each
      fiscal quarter and (ii) with reference to the Ratings at the time of each change
      in such Ratings. In the case of the Leverage Ratio such determination shall
      be
      made from the then most recent annual or quarterly financial statements of
      the
      Borrower delivered by the Borrower pursuant to Sections 5.08(1) and 5.08(2),
      and
      the adjustment, if any, to the Applicable Eurodollar Margin shall take place
      on,
      and be effective from and after, the fifth Business Day after the date on which
      the Agent has received such financial statements. In the case of the Ratings,
      any change in such Ratings shall result in a change in the Applicable Eurodollar
      Margin as of the beginning of the next succeeding applicable Interest Period
      for
      Eurodollar Loans.

     

    (c) If,
      as a
      result of any restatement of or other adjustment to the financial statements
      of
      the Borrower or a calculation error, the Borrower or the Agent determines that
      (i) the  Leverage Ratio as calculated by the Borrower as of any applicable
      date was inaccurate and (ii) a proper calculation of the Leverage Ratio would
      have resulted in higher pricing for such period, the Borrower shall immediately
      and retroactively be obligated to pay to the Agent, for the account of the
      applicable Lenders, promptly on demand by the Agent (or, after the 

     

    
      
        
        

      

      
        23

        
          

        

      

      
        
        

      

    

     

    occurrence
      of an actual or deemed entry of an order for relief with respect to Borrower
      under the Bankruptcy Code of the United States of America, automatically and
      without further action by the Agent, any Lender, or any Issuer), an amount
      equal
      to the excess of the amount of interest and fees that should have been paid
      for
      such period over the amount of interest and fees actually paid for such
      period.  This paragraph shall not limit the rights of the Agent, any
      Lender, or any Issuer, as the case may be  under Article VIII.  The
      Borrower's obligations under this paragraph shall survive the termination of
      the
      Commitments and the repayment of all other Obligations hereunder.

     

    Section
      2.06   Conversions
      and Renewals.
      The
      Borrower may elect from time to time to convert all or a part of one type of
      Loan into another type of Loan or to renew all or part of a Loan by giving
      the
      Agent notice at least one (1) Business Day before conversion into an ABR Loan,
      and at least three (3) Business Days before the conversion into or renewal
      of a
      Eurodollar Loan, specifying: (1) the renewal or conversion date; (2) the amount
      of the Loan to be converted or renewed; (3) in the case of conversions, the
      type
      of Loan to be converted into; and (4) in the case of renewals of or a conversion
      into a Eurodollar Loan, the duration of the Interest Period applicable thereto;
      provided
      that (a)
      the minimum principal amount of each Eurodollar Loan outstanding after a renewal
      or conversion shall be One Million Dollars ($1,000,000) and the minimum amount
      of each ABR Loan outstanding after a renewal or conversion shall be Two Hundred
      Fifty Thousand Dollars ($250,000) and in each case in integral multiples of
      $100,000 if in excess of such minimum amounts; (b) Eurodollar Loans may be
      converted on a Business Day that is not the last day of the Interest Period
      for
      such Loan only if the Borrower pays on the date of conversion all amounts due
      pursuant to Section 2.17; (c) the Borrower may not renew a Eurodollar Loan
      or
      convert an ABR Loan into a Eurodollar Loan at any time that a Default has
      occurred that is continuing; (d) no Interest Period may extend beyond the
      Termination Date; and (e) not more than eight (8) Interest Periods for
      Eurodollar Loans may be outstanding at any one time. Each such notice shall
      be
      accompanied by a Borrowing Base Certificate dated as at the date of such notice.
      All conversions and renewals shall be made in the proportion of the Lenders’
respective Pro Rata Shares. All notices given by the Borrower under this Section
      2.06 shall be irrevocable and shall be given not later than 11:00 A.M.
      Charlotte, North Carolina time on the day which is not less than the number
      of
      Business Days specified above for such notice. The Agent shall notify each
      Lender of each such notice not later than noon Charlotte, North Carolina time
      on
      the date it receives such notice from the Borrower if such notice is received
      by
      the Agent at or before 11:00 A.M. Charlotte, North Carolina time. In the event
      such notice from the Borrower is received after 11:00 A.M. Charlotte, North
      Carolina time, it shall be treated as if received on the next succeeding
      Business Day, and the Agent shall notify each Lender of such notice as soon
      as
      practicable but not later than noon Charlotte, North Carolina time on the next
      succeeding Business Day. Notwithstanding the foregoing, if the Borrower shall
      fail to give the Agent the notice as specified above for the renewal or
      conversion of a Eurodollar Loan prior to the end of the Interest Period with
      respect thereto, such Eurodollar Loan shall automatically be converted into
      an
      ABR Loan on the last day of the Interest Period for such Loan. The provisions
      of
      this Section 2.06 shall not apply to Swing Line Loans.

     

    Section
      2.07   Interest.
      (a) The
      Borrower shall pay interest to the Agent, for the account of the applicable
      Lender or Lenders on the outstanding and unpaid principal amount of the Loans
      at
      the following rates:

     

    
      
        
        

      

      
        24

        
          

        

      

      
        
        

      

       

    

    (i) If
      an ABR
      Loan or Swing Line Loan, then at a rate per annum equal to the Alternate Base
      Rate in effect from time to time as interest accrues; and

     

    (ii) If
      a
      Eurodollar Loan, then at a rate per annum for the Interest Period applicable
      to
      such Eurodollar Loan equal to the Eurodollar Rate for such Interest
      Period.

     

    (b) Any
      change in the interest rate based on the Alternate Base Rate resulting from
      a
      change in the Alternate Base Rate shall be effective (without notice) as of
      the
      opening of business on the day on which such change in the Alternate Base Rate
      becomes effective. Interest on each Eurodollar Loan shall be calculated on
      the
      basis of a year of 360 days for the actual number of days elapsed. Interest
      on
      each ABR Loan and Swing Line Loan calculated on the basis of the Prime Rate
      shall be calculated on the basis of a year of 365 or 366 days (as appropriate)
      for the actual number of days elapsed and interest on each ABR Loan and Swing
      Line Loan calculated based on the Federal Funds Effective Rate shall be
      calculated on the basis of a year of 360 days for the actual number of days
      elapsed.

     

    (c) Interest
      on the Loans shall be paid (in an amount set forth in a statement delivered
      by
      the Agent to the Borrower, provided,
      however,
      that
      the failure of the Agent to deliver such statement shall not limit or otherwise
      affect the obligations of the Borrower hereunder) in immediately available
      funds
      to the Agent at the office of Agent from time to time designated by it in
      writing for the account of the applicable Lending Office of each applicable
      Lender as follows:

     

    
      	 	
              (1)

            	
              For
                each ABR Loan and Swing Line Loan on the first day of each calendar
                month
                commencing on the first such date after such
                Loan;

            

    

     

    
      	 	
              (2)

            	
              For
                each Eurodollar Loan, on the last day of the Interest Period with
                respect
                thereto, except that, if such Interest Period is longer than three
                months,
                interest shall also be paid on the last day of the third month of
                such
                Interest Period; and

            

    

     

    
      	 	
              (3)

            	
              If
                not sooner paid, then on the Termination Date or such earlier date
                as the
                Loans may be due or declared due
                hereunder.

            

    

     

    (d) Any
      principal amount of any Loan not paid when due (at maturity, by acceleration,
      or
      otherwise) shall bear interest thereafter until paid in full, payable on demand,
      at a rate per annum equal to the Alternate Base Rate or the applicable
      Eurodollar Rate, as the case may be, for such Loan in effect from time to time
      as interest accrues, plus two percent (2%) per annum.

     

    Section
      2.08   Interest
      Rate Determination.
      (a) The
      Agent shall determine each Adjusted LIBO Rate. The Agent shall give prompt
      notice to the Borrower and the Lenders of the applicable interest rate
      determined by the Agent pursuant to the terms of this Agreement.

     

    (b) If
      the
      provisions of this Agreement or any Note would at any time require payment
      by
      the Borrower to a Lender of any amount of interest in excess of the maximum
      amount then permitted by the law applicable to any Loan, the interest payments
      to such Lender shall be reduced to the extent necessary so that such Lender
      shall not receive interest in excess of such maximum amount. If, as a result
      of
      the foregoing a Lender shall receive interest payments hereunder or under a
      Note
      in an amount less than the amount 

     

    
      
        
        

      

      
        25

        
          

        

      

      
        
        

      

       

    

    otherwise
      provided hereunder, such deficit (hereinafter called “Interest Deficit”) will
      cumulate and will be carried forward (without interest) until the termination
      of
      this Agreement. Interest otherwise payable to a Lender hereunder and under
      a
      Note for any subsequent period shall be increased by the maximum amount of
      the
      Interest Deficit that may be so added without causing such Lender to receive
      interest in excess of the maximum amount then permitted by the law on the
      applicable Loans. The amount of the Interest Deficit relating to the Loans
      shall
      be treated as a prepayment premium (to the extent permitted by law) and paid
      in
      full at the time of any optional prepayment by the Borrower to the applicable
      Lenders of all the applicable Loans at that time outstanding pursuant to Section
      2.11. The amount of the Interest Deficit relating to the applicable Loans at
      the
      time of any complete payment of the Loans at that time outstanding (other than
      an optional prepayment thereof pursuant to Section 2.11) shall be canceled
      and
      not paid.

     

    Section
      2.09   Fees.
      (a) The
      Borrower shall pay to the Arrangers on the Closing Date a one time,
      nonrefundable fee in the amount provided for in the Agent’s Fee Letter. The
      Agent shall deliver to each Lender its applicable fee (as set forth in the
      invitation letter dated as of June 9, 2007 from the Arrangers to such Lenders)
      promptly upon the Agent’s receipt thereof.

     

    (b) The
      Borrower agrees to pay to the Agent for the account of each Lender (subject
      to
      adjustment in the case of the Swing Line Lender as hereinafter provided) a
      commitment fee on the average daily unused portion of such Lender’s Commitment
      (in an amount set forth in a statement delivered by the Agent to the Borrower,
      provided,
      however,
      that
      the failure of the Agent to deliver such statement shall not limit or otherwise
      affect the obligations of the Borrower hereunder) from the date of this
      Agreement until the Termination Date at the Applicable Commitment Rate, payable
      in arrears on each Quarterly Payment Date during the term of such Commitment,
      commencing October 1, 2007, and ending on the Termination Date or, in the case
      of a Rejecting Lender, on such Rejecting Lender’s Termination Date. The
      commitment fees shall be calculated on the basis of a year of 360 days for
      the
      actual number of days elapsed. Upon receipt of any commitment fees, the Agent
      will promptly thereafter cause to be distributed such payments to the Lenders
      in
      the proportion of their Pro Rata Shares (subject to adjustment in the case
      of
      the Swing Line Lender as hereinafter provided). For purposes of determining
      the
      commitment fee payable to (i) the Swing Line Lender, the unused portion of
      the
      Swing Ling Lender’s Commitment shall be reduced dollar-for-dollar by the amount
      of any Swing Line Loans then outstanding, and (ii) any Lender, the unused
      portion of such Lender’s Commitment shall be reduced dollar-for-dollar by its
      Pro Rata Share of Facility Letter of Credit Obligations.

     

    (c) The
      Borrower shall pay to the Agent and the Arrangers such additional fees as are
      specified in the Agent’s Fee Letter.

     

    Section
      2.10   Notes.
      All
      Loans made by each Lender under this Agreement shall be evidenced by, and repaid
      with interest in accordance with, a single Note of the Borrower in substantially
      the form of Exhibit
      B
      hereto,
      in each case duly completed, dated the date of this Agreement and payable to
      such Lender for the account of its applicable Lending Office, such Note to
      represent the obligation of the Borrower to repay the Loans made by such Lender.
      Each Lender is hereby authorized by the Borrower, but no Lender shall be
      required, to endorse on the schedule attached to the Note or Notes held by
      it
      the amount and type of such applicable Loan and each renewal, conversion, and
      payment of principal amount received by such applicable Lender for the account
      of its applicable Lending Office on account of its applicable Loans, which
      endorsement shall, in the absence of manifest error, be conclusive as to the
      outstanding balance of such Loans made by such Lender; provided,
      however,
      that
      the failure to make such notation with respect to any Loan or renewal,
      conversion, or payment shall not limit or otherwise affect the obligations
      of
      the Borrower under this Agreement or the Note or Notes held by such Lender.
      All
      Loans shall be repaid on the Termination Date.

     

    
      
        
        

      

      
        26

        
          

        

      

      
        
        

      

       

    

    Section
      2.11   Prepayments.
      (a) The
      Borrower may, upon notice to the Agent not later than noon (Charlotte, North
      Carolina time) on the date of prepayment in the case of ABR Loans and at least
      three (3) Business Days’ prior notice to the Agent in the case of Eurodollar
      Loans, prepay (including, without limitation, all amounts payable pursuant
      to
      the terms of Section 2.17) the Loans in whole or in part with accrued interest
      to the date of such prepayment on the amount prepaid, provided
      that (1)
      each partial payment shall be in a principal amount of not less than One Million
      Dollars ($1,000,000) in the case of a Eurodollar Loan and Two Hundred Fifty
      Thousand Dollars ($250,000) in the case of an ABR Loan; and (2) Eurodollar
      Loans
      may be prepaid only on the last day of the Interest Period for such Loans;
      provided,
      however,
      that
      such prepayment of Eurodollar Loans may be made on any other Business Day if
      the
      Borrower pays at the time of such prepayment all amounts due pursuant to Section
      2.17. Upon receipt of any such prepayments, the Agent will promptly thereafter
      cause to be distributed the Pro Rata Share of such prepayment to each Lender
      for
      the account of its applicable Lending Office, except that prepayments of Swing
      Line Loans shall be made solely to the Swing Line Lender.

     

    (b) The
      Borrower shall immediately upon a Change in Control prepay the Notes in full
      and
      all accrued interest to the date of such prepayment, and in the case of
      Eurodollar Loans all amounts due pursuant to Section 2.17.

     

    Section
      2.12   Method
      of Payment.
      The
      Borrower shall make each payment under this Agreement and under any of the
      Notes
      not later than noon Charlotte, North Carolina time on the date when due in
      lawful money of the United States to the Agent for the account of the applicable
      Lending Office of each Lender (or, in the case of Swing Line Loans, for the
      account of the Swing Line Lender) in immediately available funds. The Agent
      will
      promptly thereafter cause to be distributed (1) the Pro Rata Share of such
      payments of principal and interest with respect to Loans (other than Swing
      Line
      Loans) in like funds to each Lender for the account of its applicable Lending
      Office, (2) such payments of principal and interest with respect to Swing Line
      Loans solely to the Swing Line Lender and (3) other fees payable to any Lender
      to be applied in accordance with the terms of this Agreement. If any such
      payment is not received by a Lender on the Business Day on which the Agent
      received such payment (or the following Business Day if the Agent’s receipt
      thereof occurs after 3:00 P.M. (Charlotte, North Carolina time)), such Lender
      shall be entitled to receive from the Agent interest on such payment at the
      Federal Funds Effective Rate for three Business Days and thereafter at the
      Alternate Base Rate (which interest payment shall not be an obligation for
      the
      Borrower’s account, including under Section 10.04 or Section 10.06). The
      Borrower hereby authorizes each Lender, if and to the extent payment is not
      made
      when due under this Agreement or under any of the Notes, to charge from time
      to
      time against any account of the Borrower with such Lender any amount as due.
      Whenever any payment to be made under this Agreement or under any of the Notes
      shall be stated to be due on a day other than a Business Day, such payment
      shall
      be made on the next succeeding Business Day, and such extension of time shall
      be
      included in the computation of the payment of interest and the commitment fee,
      as the case may be, except, in the case of a Eurodollar Loan, if the result
      of
      such extension would be to extend such payment into another calendar month,
      such
      payment shall be made on the immediately preceding Business Day.

     

    
      
        
        

      

      
        27

        
          

        

      

      
        
        

      

       

    

    Section
      2.13   Use
      of Proceeds.
      The
      proceeds of the Loans hereunder shall be used by the Borrower (a) to repay
      in
      full all amounts owing under the Original Credit Agreement (except for Existing
      Letters of Credit), (b) for working capital and general corporate purposes
      of
      the Borrower and the Guarantors to the extent permitted in this Agreement and
      (c) to repay Swing Line Loans. The Borrower will not, directly or indirectly,
      use any part of such proceeds for the purpose of repaying the Senior Notes
      or
      for purchasing or carrying any margin stock within the meaning of Regulation
      U
      or to extend credit to any Person for the purpose of purchasing or carrying
      any
      such margin stock, or for any purpose which violates, or is inconsistent with,
      Regulation X.

     

    Section
      2.14   Yield
      Protection.
      If any
      law or any governmental or quasi-governmental rule, regulation, policy,
      guideline or directive (whether or not having the force of law), or any
      interpretation thereof, or the compliance of any Lender or Issuer
      therewith,

     

    
      	 	
              (i)

            	
              subjects
                any Lender or Issuer or any applicable Lending Office to any tax,
                duty,
                charge or withholding on or from payments due from the Borrower (excluding
                federal taxation of the overall net income of any Lender or Issuer
                or
                applicable Lending Office), or changes the basis of taxation of payments
                to any Lender or Issuer in respect of its Loans or Facility Letters
                of
                Credit or other amounts due it hereunder,
                or

            

    

     

    
      	 	
              (ii)

            	
              imposes
                or increases or deems applicable any reserve, assessment, insurance
                charge, special deposit or similar requirement against assets of,
                deposits
                with or for the account of, or credit extended by, any Lender or
                Issuer or
                any applicable Lending Office (other than reserves and assessments
                taken
                into account in determining the interest rate applicable to Loans),
                or

            

    

     

    
      	 	
              (iii)

            	
              imposes
                any other condition the result of which is to increase the cost to
                any
                Lender or Issuer or any applicable Lending Office of making, funding
                or
                maintaining loans or issuing or participating in letters of credit
                or
                reduces any amount receivable by any Lender or Issuer or any applicable
                Lending Office in connection with loans, or requires any Lender or
                Issuer
                or any applicable Lending Office to make any payment calculated by
                reference to the amount of loans held, letters of credit issued or
                interest received by it, by an amount deemed material by such Lender
                or
                Issuer,

            

    

     

    then,
      within fifteen (15) days of demand by such Lender or Issuer, the Borrower shall
      pay such Lender or Issuer that portion of such increased expense incurred or
      reduction in an amount received which such Lender or Issuer reasonably
      determines is attributable to making, funding and maintaining its Loans and
      its
      Commitment and issuing or participating in Letters of Credit.

     

    
      
        
        

      

      
        28

        
          

        

      

      
        
        

      

       

    

    Section
      2.15   Changes
      in Capital Adequacy Regulations.
      If a
      Lender or Issuer determines the amount of capital required or expected to be
      maintained by such Lender or Issuer, any Lending Office of such Lender or Issuer
      or any corporation controlling such Lender or Issuer is increased as a result
      of
      a Change, then, within 10 days of demand by such Lender or Issuer, the Borrower
      shall pay such Lender or Issuer the amount necessary to compensate for any
      shortfall in the rate of return on the portion of such increased capital which
      such Lender or Issuer determines is attributable to this Agreement, its Loans
      or
      its obligation to make Loans hereunder (after taking into account such Lender’s
      or Issuer’s policies as to capital adequacy); provided,
      however,
      that a
      Lender or Issuer shall impose such cost upon the Borrower only if such Lender
      or
      Issuer is generally imposing such cost on its other borrowers having similar
      credit arrangements. “Change” means (i) any change after the date of this
      Agreement in the Risk-Based Capital Guidelines or (ii) any adoption of or change
      in any other law, governmental or quasi-governmental rule, regulation, policy,
      guideline, interpretation, or directive (whether or not having the force of
      law)
      after the date of this Agreement which affects the amount of capital required
      or
      expected to be maintained by any Lender or Issuer or any Lending Office or
      any
      corporation controlling any Lender or Issuer. “Risk-Based Capital Guidelines”
means (i) the risk-based capital guidelines in effect in the United States
      on
      the date of this Agreement, including transition rules, and (ii) the
      corresponding capital regulations promulgated by regulatory authorities outside
      the United States implementing the July 1988 report of the Basle Committee
      on
      Banking Regulation and Supervisory Practices Entitled “International Convergence
      of Capital Measurements and Capital Standards,” including transition rules, and
      any amendments to such regulations adopted prior to the date of this
      Agreement.

     

    Section
      2.16   Availability
      of Eurodollar Loans.
      If any
      Lender determines that maintenance of its Eurodollar Loans at the Lending Office
      selected by the Lender would violate any applicable law, rule, regulation,
      or
      directive, whether or not having the force of law (and it is not reasonably
      possible for the Lender to designate an alternate Lending Office without being
      adversely affected thereby), or if the Required Lenders determine that (i)
      deposits of a type and maturity appropriate to match fund Eurodollar Loans
      are
      not available or (ii) the interest rate applicable to Eurodollar Loans does
      not
      accurately reflect the cost of making or maintaining such Eurodollar Loans,
      then
      the Agent shall suspend the availability of Eurodollar Loans and require any
      Eurodollar Loans to be repaid.

     

    Section
      2.17   Funding
      Indemnification.
      If any
      payment of a Eurodollar Loan occurs on a date which is not the last day of
      the
      applicable Interest Period, whether because of acceleration, prepayment or
      otherwise, or a Eurodollar Loan is not made on the date specified by the
      Borrower for any reason other than default by the Lenders, the Borrower will
      indemnify each Lender for any loss or cost incurred by it resulting therefrom,
      including, without limitation, any loss or cost in liquidating or employing
      deposits required to fund or maintain the Eurodollar Loan.

     

    Section
      2.18   Lender
      Statements; Survival of Indemnity.
      To the
      extent reasonably possible, each Lender shall designate an alternate Lending
      Office with respect to its Eurodollar Loans to reduce any liability of the
      Borrower to such Lender under Sections 2.14 and 2.15 or to avoid the
      unavailability of Eurodollar Loans. Each Lender shall deliver a written
      statement of such Lender as to the amount due, if any, under Sections 2.14,
      2.15
      or 2.17. Such written statement shall set forth in reasonable detail the
      calculations upon which 

     

    
      
        
        

      

      
        29

        
          

        

      

      
        
        

      

       

    

    such
      Lender determined such amount and shall be final, conclusive and binding on
      the
      Borrower in the absence of manifest error. Determination of amounts payable
      under such Sections in connection with a Eurodollar Loan shall be calculated
      as
      though each Lender funded its Eurodollar Loan through the purchase of a deposit
      of the type and maturity corresponding to the deposit used as a reference in
      determining the Eurodollar Rate applicable to such Loan, whether in fact that
      is
      the case or not. Unless otherwise provided herein, the amount specified in
      the
      written statement shall be payable on demand after receipt by the Borrower
      of
      the written statement. The obligations of the Borrower under Sections 2.14,
      2.15
      and 2.17 shall survive payment of the Obligations and termination of this
      Agreement.

     

    Section
      2.19   Extension
      of Termination Date.
      (a) Not
      more than once in any fiscal year of the Borrower, the Borrower may request
      an
      extension of the Termination Date to the first or second anniversary of the
      then
      scheduled Termination Date (but in no event later than the fourth anniversary
      of
      the effective date of such requested extension) by submitting a request for
      an
      extension to the Agent not less than 180 days prior to the then scheduled
      Termination Date. At the time of or prior to the delivery of such request,
      the
      Borrower shall propose to the Agent the amount of the fees that the Borrower
      would agree to pay with respect to such extension if approved by the Lenders.
      Promptly upon (but not later than five Business Days after) the Agent’s receipt
      and approval of the extension request and fee proposal (as so approved, the
      “Extension Request”), the Agent shall deliver to each Lender a copy of, and
      shall request each Lender to approve, the Extension Request. Each Lender
      approving the Extension Request shall deliver its written approval no later
      than
      60 days after such Lender’s receipt of the Extension Request. If the written
      approval of the Extension Request by the Lenders whose Pro Rata Shares equal
      or
      exceed 66-2/3% in the aggregate is received by the Agent within such 60-day
      period, the Termination Date shall be extended to the first or second
      anniversary of the then scheduled Termination Date (as specified in the
      Extension Request) but only with respect to the Lenders that have given such
      written approval. Except to the extent that a Lender that did not give its
      written approval to such Extension Request (“Rejecting Lender”) is replaced as
      provided in Section 2.20, prior to the Termination Date (as determined prior
      to
      such Extension Request), then on such date (the “Rejecting Lender’s Termination
      Date”) (i) the Commitment of each such Rejecting Lender shall terminate, (ii)
      the Aggregate Commitment shall be reduced by the aggregate amount of such
      terminated Commitments and (iii) all Loans and other Obligations to each such
      Rejecting Lender shall be paid in full by the Borrower. If the sum of the
      principal balance of all Loans outstanding and all Facility Letter of Credit
      Obligations following the payment provided for in clause (iii) above exceeds
      the
      Aggregate Commitment (as reduced as provided in clause (ii) above), the Borrower
      shall, on the Rejecting Lender’s Termination Date, repay outstanding Loans or
      cause to be canceled, released and returned to the applicable Issuer outstanding
      Facility Letters of Credit in the amounts necessary to cause the sum of the
      principal balance of all Loans outstanding and all Facility Letter of Credit
      Obligations to equal but not exceed the Aggregate Commitment (as
      reduced).

     

    (b) Within
      ten days of the Agent’s notice to the Borrower that the Lenders whose Pro Rata
      Shares equal or exceed 66-2/3% in the aggregate have approved an Extension
      Request, the Borrower shall pay to the Agent for the account of each Lender
      that
      has approved the Extension Request the applicable extension fees specified
      in
      the Extension Request.

     

    
      
        
        

      

      
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    (c) If
      Lenders whose Pro Rata Shares equal or exceed 66-2/3% in the aggregate approve
      the Extension Request, the Borrower, upon notice to the Agent and any Rejecting
      Lender, may, subject to the provisions of the last sentence of Section 2.19(d),
      terminate the Commitment of such Rejecting Lender (or such portion of such
      Commitment as is not assigned to a Replacement Lender in accordance with Section
      2.20), which termination shall occur as of a date set forth in such Borrower’s
      notice but in no event more than thirty (30) days following such notice (subject
      to the provisions of Section 2.20(b)). The termination of a Rejecting Lender’s
      Commitment shall be effected in accordance with Section 2.19(d).

     

    (d) If
      the
      Borrower elects to terminate the Commitment of a Rejecting Lender pursuant
      to
      Section 2.19(c), the Borrower shall pay to the Rejecting Lender all Obligations
      due and owing to it hereunder or under any other Loan Document, including,
      without limitation, the aggregate outstanding principal amount of the Loans
      owed
      to such Rejecting Lender, together with accrued interest thereon through the
      date of such termination, amounts payable under Sections 2.14 and 2.15 and
      the
      fees payable to such Rejecting Lender under Section 2.09(b). Upon request by
      the
      Borrower or the Agent, the Rejecting Lender will deliver to the Borrower and
      the
      Agent a letter setting forth the amounts payable to the Rejecting Lender as
      set
      forth above. Upon the termination of such Rejecting Lender’s Commitment and
      payment of the amounts provided for in the immediately preceding sentence,
      the
      Borrower shall have no further obligations to such Rejecting Lender under this
      Agreement and such Rejecting Lender shall cease to be a Lender, provided,
      however,
      that
      such Rejecting Lender shall continue to be entitled to the benefits of Sections
      2.14, 2.15, 2.17, 10.04 and 10.06, as well as to any fees accrued for its
      account hereunder not yet paid, and shall continue to be obligated under Section
      9.05 with respect to obligations and liabilities accruing prior to the
      termination of such Rejecting Lender’s Commitment. If, as a result of the
      termination of the Rejecting Lender’s Commitment, any payment of a Eurodollar
      Loan occurs on a day which is not the last day of the applicable Interest
      Period, the Borrower shall pay to the Agent for the benefit of the Lenders
      (including any Rejecting Lender) any loss or cost incurred by the Lenders
      (including any Rejecting Lender) resulting therefrom in accordance with Section
      2.17. Upon the effective date of the termination of the Rejecting Lender’s
      Commitment, the Aggregate Commitment shall be reduced by the amount of the
      terminated Commitment of the Rejecting Lender, and each other Lender shall
      be
      deemed to have irrevocably and unconditionally purchased and received (subject
      to the provisions of the last sentence of this Section 2.19(d)), without
      recourse or warranty, from the Rejecting Lender, an undivided interest and
      participation in any Facility Letter of Credit then outstanding, ratably, such
      that each Lender (excluding the Rejecting Lender but including any Replacement
      Lender that acquires an interest in the Facility hereunder from such Rejecting
      Lender) holds a participation interest in each Facility Letter of Credit in
      proportion to the ratio that such Rejecting Lender’s Commitment (upon the
      effective date of such termination of the Rejecting Lender’s Commitment) bears
      to the Aggregate Commitment (as reduced by the termination of such Rejecting
      Lender’s Commitment or a part thereof). Notwithstanding the foregoing, if, upon
      the termination of the Commitment of such Rejecting Lender under this Section
      2.19(d), the sum of the outstanding principal balance of the Loans and the
      Facility Letter of Credit Obligations would exceed the Aggregate Commitment
      (as
      reduced), the Borrower may not terminate such Rejecting Lender’s Commitment
      unless the Borrower, on or prior to the effective date of such termination,
      prepays, in accordance with the provisions of this Agreement, outstanding Loans
      or causes to be canceled, released and returned to the applicable Issuer
      outstanding Facility Letters of Credit in sufficient amounts such that, on
      the
      effective date of such termination, the sum of the outstanding principal balance
      of the Loans and the Facility Letter of Credit Obligations does not exceed
      the
      Aggregate Commitment (as reduced).

     

    
      
        
        

      

      
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    Section
      2.20   Replacement
      of Certain Lenders.
      (a) In
      the event a Lender (“Affected Lender”): (i) shall have requested compensation
      from the Borrower under Sections 2.14 or 2.15 to recover additional costs
      incurred by such Lender that are not being incurred generally by the other
      Lenders, (ii) shall have delivered a notice pursuant to Section 2.16 claiming
      that such Lender is unable to extend Eurodollar Loans to the Borrower for
      reasons not generally applicable to the other Lenders, (iii) shall have invoked
      Section 10.13 or (iv) is a Rejecting Lender pursuant to Section 2.19, then,
      in
      any such case, the Borrower or the Agent may effect the replacement of such
      Affected Lender in accordance with the provisions of this Section 2.20,
provided,
      however,
      that if
      the replacement of such Affected Lender is by reason of clause (iv) above,
      the
      replacement of such Affected Lender shall be subject to the provisions of
      Section 2.20(b). The Borrower or the Agent may elect to replace an Affected
      Lender and make written demand on such Affected Lender (with a copy to the
      Agent
      in the case of a demand by the Borrower and a copy to the Borrower in the case
      of a demand by the Agent) for the Affected Lender to assign, and, if a
      Replacement Lender (as hereinafter defined) notifies the Affected Lender of
      its
      willingness to purchase the Affected Lender’s interests in the Facility and the
      Agent and the Borrower consent thereto in writing, then such Affected Lender
      shall assign pursuant to one or more duly executed Assignment and Assumption
      in
      substantially and in all material respects in the form and substance of
Exhibit
      F
      five (5)
      Business Days after the date of such demand, to one or more financial
      institutions that comply with the provisions of Section 11.02 that the Borrower
      or the Agent, as the case may be, shall have engaged for such purpose (each
      a
“Replacement Lender”), all (or, to the extent required or permitted under
      Section 2.20(b), a part) of such Affected Lender’s rights and obligations (from
      and after the date of such assignment) under this Agreement and the other Loan
      Documents in accordance with Section 11.02. The Agent agrees, upon the
      occurrence of such events with respect to an Affected Lender and upon the
      written request of the Borrower, to use its reasonable efforts to obtain
      commitments from one or more financial institutions to act as a Replacement
      Lender. As a condition to any such assignment, the Affected Lender shall have
      concurrently received, in cash, all amounts (except as otherwise provided in
      Section 2.20(b)) due and owing to the Affected Lender hereunder or under any
      other Loan Document, including, without limitation, the aggregate outstanding
      principal amount of the Loans owed to such Lender, together with accrued
      interest thereon through the date of such assignment, amounts payable under
      Sections 2.14 and 2.15 with respect to such Affected Lender and the fees payable
      to such Affected Lender under Section 2.09(b); provided
      that
      upon such Affected Lender’s replacement, such Affected Lender shall (except as
      otherwise provided in Section 2.20(b)) cease to be a party hereto but shall
      continue to be entitled to the benefits of Sections 2.14, 2.15, 2.17, 10.04
      and
      10.06, as well as to any fees accrued for its account hereunder and not yet
      paid, and shall continue to be obligated under Section 9.05 with respect to
      obligations and liabilities accruing prior to the replacement of such Affected
      Lender.

     

    (b) In
      the
      event that the Affected Lender is a Rejecting Lender, the Borrower may elect
      to
      have a part of the Rejecting Lender’s rights and obligations under this
      Agreement and the other Loan Documents assigned pursuant to this Section 2.20,
      provided
      that the
      Borrower also elects, pursuant to Section 2.19(c), to terminate the entire
      amount of such Rejecting Lender’s Commitment not so assigned, which termination
      shall be effective on the date on which such assignment of the Rejecting
      Lender’s rights and obligations is consummated under this Section
      2.20.

     

    
      
        
        

      

      
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    Section
      2.21   Swing
      Line.
      (a) The
      Swing Line Lender agrees, on the terms and conditions hereinafter set forth,
      to
      make loans (“Swing Line Loans”) to the Borrower from time to time during the
      period from the date of this Agreement, up to but not including the Termination
      Date, in an aggregate principal amount not to exceed at any time outstanding
      the
      lesser of (i) the Swing Line Commitment or (ii) the amount by which the Swing
      Line Lender’s Commitment exceeds the sum of (A) the outstanding principal amount
      of the Loans made by the Swing Line Lender pursuant to Section 2.01.1 and (B)
      the Swing Line Lender’s Pro Rata Share of the outstanding Facility Letter of
      Credit Obligations, subject in each case to the limitations set forth in Section
      2.01.3.

     

    (b) Each
      Swing Line Loan which shall not utilize the Swing Line Commitment in full shall
      be in an amount not less than One Million Dollars ($1,000,000) and, if in excess
      thereof, in integral multiples of One Million Dollars ($1,000,000). Within
      the
      limits of the Swing Line Commitment, the Borrower may borrow, repay and reborrow
      under this Section 2.21.

     

    (c) The
      Borrower shall give the Swing Line Lender notice of any request for a Swing
      Line
      Loan not later than 3:00 p.m. Charlotte, North Carolina time on the Business
      Day
      of such Swing Line Loan, specifying the amount of such requested Swing Line
      Loan. Each such notice shall be accompanied by a Borrowing Base Certificate
      dated as of the date of such notice (and by the notice provided for in Section
      2.21(d)). All notices given by the Borrower under this Section 2.21(c) shall
      be
      irrevocable. Upon fulfillment of the applicable conditions set forth in Article
      III, the Swing Line Lender will make the Swing Line Loan available to the
      Borrower in immediately available funds by crediting the amount thereof to
      the
      Borrower’s account with the Swing Line Lender.

     

    (d) On
      the
      fifth Business Day following the making of a Swing Line Loan, such Swing Line
      Loan shall be paid in full from the proceeds of a Loan made pursuant to Section
      2.01.1. Each notice given by the Borrower under Section 2.21(c) shall include,
      or, if it does not include, shall be deemed to include, an irrevocable notice
      under Section 2.03 requesting the Lenders to make an ABR Loan on the fifth
      succeeding Business Day in the full amount of such Swing Line Loan.

     

    Section
      2.22   Facility
      Letters of Credit.

     

    Section
      2.22.1   Issuance
      of Facility Letters of Credit.
      (a)
      Each Issuer agrees, on the terms and conditions set forth in this Agreement,
      to
      issue from time to time for the account of the Borrower, through such offices
      or
      branches as it and the Borrower may jointly agree, one or more Facility Letters
      of Credit in accordance with this Section 2.22, during the period commencing
      on
      the date hereof and ending on the thirtieth (30th) day prior to the Termination
      Date.

     

    (b) The
      Borrower shall not request, and no Issuer shall issue, a Facility Letter of
      Credit for any purpose other than for purposes for which Loan proceeds may
      by
      used.

     

    
      
        
        

      

      
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    Section
      2.22.2   Limitations.
      An
      Issuer shall not issue, amend or extend, at any time, any Facility Letter of
      Credit:

     

    (i) if
      the
      aggregate maximum amount then available for drawing under Letters of Credit
      issued by such Issuer, after giving effect to the Facility Letter of Credit
      or
      amendment or extension thereof requested hereunder, shall exceed any limit
      imposed by law or regulation upon such Issuer;

     

    (ii) if,
      after
      giving effect to the issuance, amendment or extension of the Facility Letter
      of
      Credit requested hereunder, the aggregate principal amount of the Facility
      Letter of Credit Obligations would exceed the Facility Letter of Credit
      Sublimit;

     

    (iii) if,
      after
      giving effect to the issuance, amendment or extension of the Facility Letter
      of
      Credit requested hereunder, Borrowing Base Debt would exceed the Borrowing
      Base
      as of the most recent Inventory Valuation Date;

     

    (iv) if,
      after
      giving effect to the issuance, amendment or extension of the Facility Letter
      of
      Credit requested hereunder, the sum of (A) the outstanding and unpaid principal
      amount of the Loans and (B) the Facility Letter of Credit Obligations would
      exceed the Aggregate Commitment;

     

    (v) unless
      such Issuer receives written notice from the Agent on or before the proposed
      Issuance Date of such Facility Letter of Credit that the issuance, amendment
      or
      extension of such Facility Letter of Credit is within the limitations specified
      in clauses (ii), (iii) and (iv) of this Section 2.22.2;

     

    (vi) that
      has
      an expiration date (taking into account any automatic renewal provisions
      thereof) later than thirty (30) days prior to the scheduled Termination Date;
      or

     

    (vii) that
      is
      in a currency other than U.S. Dollars or that provides for drawings other than
      by sight draft.

     

    Section
      2.22.3   Conditions.
      The
      issuance, amendment or extension of any Facility Letter of Credit is subject
      to
      the satisfaction in full of the following conditions on the Issuance
      Date:

     

    (i) the
      Borrower shall have delivered to the Issuer at such times and in such manner
      as
      the Issuer may reasonably prescribe a Reimbursement Agreement and such other
      documents and materials as may be reasonably required pursuant to the terms
      thereof, and the proposed Facility Letter of Credit shall be reasonably
      satisfactory to such Issuer in form and content, provided, however, in the
      event
      of any conflict between the terms of this Agreement and the terms of the
      Reimbursement Agreement, the terms of this Agreement shall control;

     

    (ii) as
      of the
      Issuance Date no order, judgment or decree of any court, arbitrator or
      governmental authority shall enjoin or restrain such Issuer from issuing the
      Facility Letter of Credit and no law, rule or regulation applicable to the
      Issuer and no directive from any governmental authority with jurisdiction over
      the Issuer shall prohibit such Issuer from issuing Letters of Credit generally
      or from issuing that Facility Letter of Credit;

     

    
      
        
        

      

      
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    (iii) The
      following statements shall be true, and the Agent and such Issuer shall have
      received a certificate, substantially in the form of the certificate attached
      hereto as Exhibit
      D,
      signed
      by a duly authorized officer of the Borrower dated the Issuance Date stating
      that:

     

    
      	 	
              (a)

            	
              The
                representations and warranties contained in Article IV of this Agreement
                are correct in all material respects on and as of such Issuance Date
                as
                though made on and as of such Issuance Date except to the extent
                that any
                such representation or warranty is stated to relate solely to an
                earlier
                date, in which case such representation or warranty is correct in
                all
                material respects as of such earlier
                date;

            

    

     

    
      	 	
              (b)

            	
              No
                Default or Event of Default has occurred and is continuing or would
                result
                from the issuance, amendment or extension of such Facility Letter
                of
                Credit; and

            

    

     

    
      	 	
              (c)

            	
              If
                applicable under Section 7.03, upon the issuance, amendment or extension
                of the requested Facility Letter of Credit on such Issuance Date,
                the
                aggregate outstanding amount of Borrowing Base Debt shall not exceed
                the
                Borrowing Base as of the most recent Inventory Valuation Date;
                and

            

    

     

    (iv) The
      Issuer and the Agent shall have received such other approvals, opinions, or
      documents as either may reasonably request.

     

    Section
      2.22.4   Procedure
      for Issuance of Facility Letters of Credit.
      (a) The
      Borrower shall give the applicable Issuer and the Agent not less than two (2)
      Business Days’ prior written notice of any requested issuance of a Facility
      Letter of Credit under this Agreement (except that, in lieu of such written
      notice, the Borrower may give the Issuer and the Agent telephonic notice of
      such
      request if confirmed in writing by delivery to such Issuer and the Agent (i)
      immediately (A) of a telecopy of the written notice required hereunder which
      has
      been signed by an authorized officer of the Borrower or (B) of an e-mail
      containing all information required to be contained in such written notice
      and
      (ii) promptly (but in no event later than the requested Issuance Date) of the
      written notice required hereunder containing the original signature of an
      authorized officer of the Borrower). Such notice shall specify (i) the stated
      amount of the Facility Letter of Credit requested, which amount shall be in
      compliance with the requirements of Section 2.22.2, (ii) the requested Issuance
      Date, which shall be a Business Day, (iii) the date on which such requested
      Facility Letter of Credit is to expire, which date shall be in compliance with
      the requirements of Section 2.22.2(vi), (iv) the purpose for which such Facility
      Letter of Credit is to be issued, which purpose shall be in compliance with
      the
      requirements of Section 2.22.1(b), and (v) the Person for whose benefit the
      requested Facility Letter of Credit is to be issued. At the time such request
      is
      made, the Borrower shall also provide the Agent with a copy of the form of
      the
      Facility Letter of Credit it is requesting be issued. Such notice, to be
      effective, must be received by the Issuer and the Agent not later than 3:00
      p.m.
      (Charlotte, North Carolina time) on the last Business Day on which notice can
      be
      given under this Section 2.22.4. Promptly after receipt of such notice, the
      Issuer shall confirm with the Agent (by telephone or in writing) that the Agent
      has received a copy of such notice from the Borrower and, if not, the Issuer
      shall promptly provide the Agent with a copy thereof.

     

    
      
        
        

      

      
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    (b) Promptly
      following receipt of a request for issuance of a Facility Letter of Credit
      in
      accordance with Section 2.22.4(a), such Issuer shall approve or disapprove,
      in
      its reasonable discretion, the issuance of such requested Facility Letter of
      Credit, but the issuance of such approved Facility Letter of Credit shall
      continue to be subject to the provisions of this Section 2.22.

     

    (c) Subject
      to the terms and conditions of this Section 2.22 (including, without limitation,
      Sections 2.22.2 and 2.22.3), the applicable Issuer shall, on the Issuance Date,
      issue the requested Facility Letter of Credit in accordance with such Issuer’s
      usual and customary business practices unless such Issuer has actually received
      written or telephonic notice from the Borrower specifically revoking the request
      to issue such Facility Letter of Credit. The Issuer shall promptly give the
      Agent written notice, or telephonic notice confirmed promptly thereafter in
      writing, of the issuance, amendment, extension or cancellation of a Facility
      Letter of Credit, and the Agent shall promptly thereafter so notify all
      Lenders.

     

    (d) No
      Issuer
      shall extend or amend any Facility Letter of Credit unless the requirements
      of
      this Section 2.22.4 are met as though a new Facility Letter of Credit were
      being
      requested and issued.

     

    (e) Any
      Lender may, but shall not be obligated to, issue to the Borrower or any of
      its
      Subsidiaries Letters of Credit (that are not Facility Letters of Credit) for
      its
      own account, and at its own risk. None of the provisions of this Section 2.22
      shall apply to any Letter of Credit that is not a Facility Letter of
      Credit.

     

    Section
      2.22.5   Duties
      of Issuer.
      Any
      action taken or omitted to be taken by an Issuer under or in connection with
      any
      Facility Letter of Credit, if taken or omitted in the absence of willful
      misconduct or gross negligence, shall not put such Issuer under any resulting
      liability to any Lender or, assuming that such Issuer has complied in all
      material respects with the procedures specified in Section 2.22.4, relieve
      any
      Lender of its obligations hereunder to such Issuer. In determining whether
      to
      pay under any Facility Letter of Credit, such Issuer shall have no obligation
      to
      the Lenders other than to confirm that any documents required to be delivered
      under such Facility Letter of Credit appear to have been delivered in compliance
      and that they appear to comply on their face with the requirements of such
      Facility Letter of Credit.

     

    Section
      2.22.6   Participation.
      (a)
      Immediately upon the Closing Date (in the case of the Existing Letters of
      Credit), and immediately upon issuance after the Closing Date by an Issuer
      of
      any Facility Letter of Credit in accordance with Section 2.22.4, each Lender
      shall be deemed to have irrevocably and unconditionally purchased and received
      from such Issuer, without recourse or warranty, an undivided interest and
      participation ratably (in the proportion of such Lender’s Pro Rata Share) in
      such Facility Letter of Credit (including, without limitation, all obligations
      of the Borrower with respect thereto other than amounts owing to such Issuer
      under Section 2.15).

     

    
      
        
        

      

      
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    (b) In
      the
      event that an Issuer makes any payment under any Facility Letter of Credit
      and
      the Borrower shall not have repaid such amount to such Issuer on or before
      the
      date of such payment by such Issuer, such Issuer shall promptly so notify the
      Agent, which shall promptly so notify each Lender. Upon receipt of such notice,
      each Lender shall promptly and unconditionally pay to the Agent for the account
      of such Issuer the amount of such Lender’s Pro Rata Share of such payment in
      same day funds, and the Agent shall promptly pay such amount, and any other
      amounts received by the Agent for such Issuer’s account pursuant to this Section
      2.22.6, to such Issuer. If the Agent so notifies such Lender prior to noon
      (Charlotte, North Carolina time) on any Business Day, such Lender shall make
      available to the Agent for the account of such Issuer such Lender’s ratable
      share of the amount of such payment on such Business Day in same day funds.
      If
      and to the extent such Lender shall not have so made its ratable share of the
      amount of such payment available to the Agent for the account of the Issuer,
      such Lender agrees to pay to the Agent for the account of the Issuer forthwith
      on demand such amount, together with interest thereon, for each day from the
      date such payment was first due until the date such amount is paid to the Agent
      for the account of the Issuer, at the Federal Funds Effective Rate. The failure
      of any Lender to make available to the Agent for the account of an Issuer such
      Lender’s ratable share of any such payment shall not relieve any other Lender of
      its obligation hereunder to make available to the Agent for the account of
      such
      Issuer its ratable share of any payment on the date such payment is to be
      made.

     

    (c) The
      payments made by the Lenders to an Issuer in reimbursement of amounts paid
      by it
      under a Facility Letter of Credit (as well as the Issuer’s ratable share, as
      Lender, of any amount that is drawn under a Facility Letter of Credit and not
      reimbursed by the Borrower) shall constitute, and the Borrower hereby expressly
      acknowledges and agrees that such payments shall constitute, Loans hereunder
      (notwithstanding that the amounts thereof may not comply with the provisions
      of
      Section 2.01.1(e)). Such Loans shall be ABR Loans, subject to the Borrower’s
      rights under this Article II.

     

    (d) Upon
      the
      request of the Agent or any Lender, each Issuer shall furnish to the requesting
      Agent or Lender copies of any Facility Letter of Credit or Reimbursement
      Agreement to which such Issuer is party.

     

    (e) The
      obligations of the Lenders to make payments to the Agent for the account of
      an
      Issuer with respect to a Facility Letter of Credit shall be irrevocable, not
      subject to any qualification or exception whatsoever and shall be made in
      accordance with the terms and conditions of this Agreement under all
      circumstances, including, without limitation, the following:

     

    (i) any
      lack
      of validity or enforceability of this Agreement or any of the other Loan
      Documents;

     

    (ii) the
      existence of any claim, setoff, defense or other right which the Borrower may
      have at any time against a beneficiary named in a Facility Letter of Credit
      or
      any transferee of any Facility Letter of Credit (or any Person for whom any
      such
      transferee may be acting), the Issuer, the Agent, any Lender, or any other
      Person, whether in connection with this Agreement, any Facility Letter of
      Credit, the transactions contemplated herein or any unrelated transactions
      (including any underlying transactions between the Borrower or any Subsidiary
      and the beneficiary named in any Facility Letter of Credit);

     

    
      
        
        

      

      
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    (iii) any
      draft, certificate or any other document presented under the Facility Letter
      of
      Credit proving to be forged, fraudulent, invalid or insufficient in any respect
      or any statement therein being untrue or inaccurate in any respect;

     

    (iv) the
      surrender or impairment of any security for the performance or observance of
      any
      of the terms of any of the Loan Documents;

     

    (v) any
      failure by the Agent or an Issuer to make any reports required pursuant to
      Section 2.22.8; or

     

    (vi) the
      occurrence of any Default or Event of Default.

     

    (f) For
      purposes of determining the unused portion of the Aggregate Commitment and
      the
      unused portion of a Lender’s Commitment under Sections 2.02.1 and 2.09(b), the
      Aggregate Commitment shall be deemed used to the extent of the aggregate undrawn
      face amount of the outstanding Facility Letters of Credit and the Lender’s
      Commitment shall be deemed used to the extent of such Lender’s Pro Rata Share of
      the aggregate undrawn face amount of the outstanding Facility Letters of
      Credit.

     

    Section
      2.22.7   Compensation
      for Facility Letters of Credit.
      (a) The
      Borrower agrees to pay to the Agent, in the case of each Facility Letter of
      Credit, the Facility Letter of Credit Fee therefor, payable quarterly in arrears
      not later than five (5) Business Days following Agent’s delivery to Borrower of
      the quarterly statement specifying the amount of the Facility Letter of Credit
      Fees properly due and payable hereunder with respect to the preceding calendar
      quarter (which payment shall be a pro rata portion of the annual Facility Letter
      of Credit Fee for such preceding calendar quarter) and on the Termination Date
      (which payment shall be in the amount of all accrued and unpaid Facility Letter
      of Credit Fees). Facility Letter of Credit Fees shall be calculated, on a pro
      rata basis for the period to which such payment applies, for actual days on
      which such Facility Letter of Credit was outstanding during such period, on
      the
      basis of a 360-day year. The Agent shall, with reasonable promptness following
      receipt from all Issuers of the reports provided for in Section 2.22.8 for
      the
      months of March, June, September and December, respectively, deliver to the
      Borrower a quarterly statement of the Facility Letter of Credit Fees then due
      and payable. The Agent shall promptly remit such Facility Letter of Credit
      Fees,
      when received by the Agent, as follows: (i) to each Issuer, solely for its
      own
      account, with respect to each Facility Letter of Credit issued by such Issuer,
      an amount per annum equal to the product of (A) 0.125% per annum and (B) the
      undrawn outstanding amount of such Facility Letter of Credit and (ii) to all
      Lenders, ratably, the balance of such Facility Letter of Credit Fees. Facility
      Letters of Credit Fees shall be payable hereunder with respect to the Existing
      Letters of Credit from and after the Closing Date.

     

    (b) An
      Issuer
      shall also have the right to receive, solely for its own account, its
      out-of-pocket costs of issuing and servicing Facility Letters of Credit, as
      the
      Borrower may agree in writing.

     

    
      
        
        

      

      
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    Section
      2.22.8   Issuer
      Reporting Requirements.
      Each
      Issuer shall, no later than the third (3rd)
      Business Day following the last day of each month, provide to the Agent a
      schedule of the Facility Letters of Credit issued by it showing the Issuance
      Date, account party, original face amount, amount (if any) paid thereunder,
      expiration date and the reference number of each Facility Letter of Credit
      outstanding at any time during such month (and indicating, with respect to
      each
      Facility Letter of Credit, whether it is a Financial Letter of Credit or
      Performance Letter of Credit) and the aggregate amount (if any) payable by
      the
      Borrower to such Issuer during the month pursuant to Section 2.15. Copies of
      such reports shall be provided promptly to each Lender by the Agent. The
      reporting requirements hereunder are in addition to those set forth in Section
      2.22.4.

     

    Section
      2.22.9   Indemnification;
      Nature of Issuer’s Duties.
      (a) In
      addition to amounts payable as elsewhere provided in this Section 2.22, the
      Borrower hereby agrees to protect, indemnify, pay and save the Agent, each
      Issuer and each Lender harmless from and against any and all claims, demands,
      liabilities, damages, losses, costs, charges and expenses (including reasonable
      attorneys’ fees) arising from the claims of third parties against the Agent, any
      Issuer or any Lender as a consequence, direct or indirect, of (i) the issuance
      of any Facility Letter of Credit other than, in the case of an Issuer, as a
      result of its willful misconduct or gross negligence, or (ii) the failure of
      an
      Issuer to honor a drawing under a Facility Letter of Credit as a result of
      any
      act or omission, whether rightful or wrongful, of any government, court or
      other
      governmental agency or authority.

     

    (b) As
      among
      the Borrower, the Lenders, the Agent and each Issuer, the Borrower assumes
      all
      risks of the acts and omissions of, or misuse of Facility Letters of Credit
      by,
      the respective beneficiaries of such Facility Letters of Credit. In furtherance
      and not in limitation of the foregoing, neither an Issuer nor the Agent nor
      any
      Lender shall be responsible: (i) for the form, validity, sufficiency, accuracy,
      genuineness or legal effect of any document submitted by any party in connection
      with the application for and issuance of the Facility Letters of Credit, even
      if
      it should in fact prove to be in any or all respects invalid, insufficient,
      inaccurate, fraudulent or forged; (ii) for the validity or sufficiency of any
      instrument transferring or assigning or purporting to transfer or assign a
      Facility Letter of Credit or the rights or benefits thereunder or proceeds
      thereof, in whole or in part, which may prove to be invalid or ineffective
      for
      any reason; (iii) for failure of the beneficiary of a Facility Letter of Credit
      to comply fully with conditions required in order to draw upon such Facility
      Letter of Credit; (iv) for errors, omissions, interruptions or delays in
      transmission or delivery of any messages, by mail, cable, telegraph, telex,
      facsimile transmission or otherwise; (v) for errors in interpretation of
      technical terms; (vi) for any loss or delay in the transmission or otherwise
      of
      any document required in order to make a drawing under any Facility Letter
      of
      Credit or of the proceeds thereof; (vii) for the misapplication by the
      beneficiary of a Facility Letter of Credit of the proceeds of any drawing under
      such Facility Letter of Credit; or (viii) for any consequences arising from
      causes beyond the control of the Agent, such Issuer and the Lenders including,
      without limitation, any act or omission, whether rightful or wrongful, of any
      government, court or other governmental agency or authority. None of the above
      shall affect, impair, or prevent the vesting of any of such Issuer’s rights or
      powers under this Section 2.22.9.

     

    
      
        
        

      

      
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    (c) In
      furtherance and extension and not in limitation of the specific provisions
      hereinabove set forth, any action taken or omitted by an Issuer under or in
      connection with the Facility Letters of Credit or any related certificates,
      if
      taken or omitted in good faith, shall not put such Issuer, the Agent or any
      Lender under any resulting liability to the Borrower or relieve the Borrower
      of
      any of its obligations hereunder to any such Person, but the foregoing shall
      not
      relieve such Issuer of its obligation to confirm that any documents required
      to
      be delivered under a Facility Letter of Credit appear to have been delivered
      in
      compliance and that they appear to comply on their face with the requirements
      of
      such Facility Letter of Credit.

     

    (d) Notwithstanding
      anything to the contrary contained in this Section 2.22.9, the Borrower shall
      have no obligation to indemnify an Issuer under this Section 2.22.9 in respect
      of any liability incurred by an Issuer arising primarily out of the willful
      misconduct or gross negligence of such Issuer, as determined by a court of
      competent jurisdiction, or out of the wrongful dishonor by such Issuer of a
      proper demand for payment made under the Facility Letters of Credit issued
      by
      such Issuer, unless such dishonor was made at the request of the
      Borrower.

     

    Section
      2.22.10   Designation
      or Resignation of Issuer.
      (a)
      Upon request by the Borrower and approval by the Agent, a Lender may at any
      time
      agree to be designated as an Issuer hereunder, which designation shall be set
      forth in a written instrument or instruments delivered by the Borrower, the
      Agent and such Lender. The Agent shall promptly deliver to the other Lenders
      a
      copy of such instrument or instruments. From and after such designation and
      unless and until such Lender resigns as an Issuer in accordance with Section
      2.22.10(b), such Lender shall have all of the rights and obligations of an
      Issuer hereunder.

     

    (b) An
      Issuer
      shall continue to be the Issuer unless and until (i) it shall have given the
      Borrower and the Agent notice that it has elected to resign as Issuer and (ii)
      unless there is, at the time of such notice, at least one other Issuer, another
      Lender shall have agreed to be the replacement Issuer and shall have been
      approved in writing by the Agent and the Borrower. A resigning Issuer shall
      continue to have the rights and obligations of the Issuer hereunder solely
      with
      respect to Facility Letters of Credit theretofore issued by it notwithstanding
      the designation of a replacement Issuer hereunder, but upon its notice of
      resignation (or, if at the time of such notice, there is not at least one other
      Issuer, then upon such designation of a replacement Issuer), the resigning
      Issuer shall not thereafter issue any Facility Letters of Credit (unless it
      shall again thereafter be designated as an Issuer in accordance with the
      provisions of this Section 2.22.10). The assignment of, or grant of a
      participation interest in, all or any part of its Commitment or Loans by a
      Lender that is also the Issuer shall not constitute an assignment or transfer
      of
      any of its rights or obligations as an Issuer.

     

    Section
      2.22.11   Termination
      of Issuer’s Obligation.
      In the
      event that the Lenders’ obligations to make Loans terminate or are terminated as
      provided in Section 8.01, each Issuer’s obligation to issue Facility Letters of
      Credit shall also terminate.

     

    Section
      2.22.12   Obligations
      of Issuer and Other Lenders.
      Except
      to the extent that a Lender shall have agreed to be designated as an Issuer,
      no
      Lender shall have any obligation to accept or approve any request for, or to
      issue, amend or extend, any Letter of Credit, and the obligations of an Issuer
      to issue, amend or extend any Facility Letter of Credit are expressly limited
      by
      and subject to the provisions of this Section 2.22.

     

    
      
        
        

      

      
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    Section
      2.22.13   Facility
      Letter of Credit Collateral Account.
      The
      Borrower agrees that it will, upon the request of the Agent or the Required
      Lenders and until the final expiration date of any Facility Letter of Credit
      and
      thereafter as long as any amount is payable to the Issuer or the Lenders in
      respect of any Facility Letter of Credit, maintain a special collateral account
      pursuant to arrangements satisfactory to the Agent (the “Facility Letter of
      Credit Collateral Account”) at the Agent’s office at the address specified
      pursuant to Section 10.02, in the name of the Borrower but under the sole
      dominion and control of the Agent, for the benefit of the Lenders and in which
      such Borrower shall have no interest other than as set forth in Section 8.01.
      The Borrower hereby pledges, assigns and grants to the Agent, on behalf of
      and
      for the ratable benefit of the Lenders and the Issuer, a security interest
      in
      all of the Borrower’s right, title and interest in and to all funds which may
      from time to time be on deposit in the Facility Letter of Credit Collateral
      Account to secure the prompt and complete payment and performance of (a) the
      obligations of the Borrower to reimburse the Issuer and (if applicable) the
      Lenders for amounts (if any) from time to time drawn on Facility Letters of
      Credit and interest thereon and other sums from time to time payable under
      Reimbursement Agreements, and (b) if and when all such obligations of the
      Borrower have been paid in full and no Facility Letters of Credit remain
      outstanding, all other Obligations. The Agent will invest any funds on deposit
      from time to time in the Facility Letter of Credit Collateral Account in
      certificates of deposit of Wachovia Bank having a maturity not exceeding 30
      days. Nothing in this Section 2.22.13 shall either obligate the Agent to require
      the Borrower to deposit any funds in the Facility Letter of Credit Collateral
      Account or limit the right of the Agent to release any funds held in the
      Facility Letter of Credit Collateral Account in each case other than as required
      by Section 8.01.

     

    Section
      2.22.14   Issuer’s
      Rights.
      All of
      the representations, warranties, covenants and agreements of the Borrower to
      the
      Lenders under this Agreement and of the Borrower under any other Loan Document
      shall inure to the benefit of each Issuer (unless the context otherwise
      indicates).

     

    ARTICLE
      III

    CONDITIONS
      PRECEDENT

     

    Section
      3.01   Conditions
      Precedent to Initial Loans.
      The
      Lenders shall not be required to make the initial Loans hereunder or to issue
      or
      participate in any Facility Letters of Credit hereunder unless and until (a)
      the
      Borrower has paid to the Agent the applicable fees referred to in Sections
      2.09(a) and (c), (b) all principal, interest, fees and other amounts payable
      under the Original Credit Agreement have been paid in full (which payment may
      be
      made in whole or in part from the proceeds of the initial Loans hereunder),
      except for the Existing Letters of Credit, and (c) the Agent shall have received
      each of the following, in form and substance satisfactory to the
      Agent:

     

    (1) Notes.
      A Note
      payable to each Lender duly executed by the Borrower;

     

    (2) Guaranty.
      The
      Guaranty duly executed by the Guarantors;

     

    (3) Evidence
      of all corporate action by the Borrower.
      Certified copies of all corporate action taken by the Borrower, including
      resolutions of its Board of Directors, authorizing the execution, delivery
      and
      performance of the Loan Documents to which it is a party and each other document
      to be delivered pursuant to this Agreement;

     

    
      
        
        

      

      
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    (4) Incumbency
      and signature certificate of Borrower.
      A
      certificate of the Secretary or Assistant Secretary of the Borrower certifying
      the names and true signatures of the officers of the Borrower authorized to
      sign
      the Loan Documents to which it is a party and the other documents to be
      delivered by the Borrower under this Agreement;

     

    (5) Certificate
      of Incorporation of Borrower.
      Copies
      of the certificate of incorporation of the Borrower, together with all
      amendments, and a certificate of good standing, all certified by the appropriate
      governmental officer in its jurisdiction of incorporation;

     

    (6) Opinions
      of counsel for Borrower.
      A
      favorable opinion of Paul, Hastings, Janofsky & Walker LLP, counsel for the
      Borrower and for the Guarantors, in substantially the form of Exhibit
      E;

     

    (7) Evidence
      of all corporate, partnership or limited liability company action by
      Guarantors.
      With
      respect to each corporate Guarantor, certified (as of the date of this
      Agreement) copies of all corporate action taken by such Guarantor, including
      resolutions of its Board of Directors, authorizing the execution, delivery,
      and
      performance of the applicable Guaranty, and with respect to each limited
      partnership Guarantor and limited liability company Guarantor, partnership
      action or limited liability company action (as applicable) taken by such
      Guarantor, including any and all necessary partnership consents or limited
      liability company consents (as applicable) authorizing the execution, delivery,
      and performance of the applicable Guaranty;

     

    (8) Articles
      or Certificate of Incorporation of Guarantors.
      Copies
      of the articles or certificate of incorporation of each corporate Guarantor,
      together with all amendments, all certified by the appropriate governmental
      officer in its jurisdiction of incorporation;

     

    (9) Incumbency
      and signature certificate of Guarantors.
      A
      certificate (dated as of the date of this Agreement) of the Secretary or
      Assistant Secretary of each corporate Guarantor or the general partner of each
      partnership Guarantor or managing member of each limited liability company
      certifying the names and true signatures of the officers of each such corporate
      Guarantor and the representative or officer of each partnership Guarantor or
      limited liability company Guarantor authorized to sign the
      Guaranty;

     

    (10) Opinion
      of counsel for Certain Guarantors.
      With
      respect to such Guarantors (other than those formed or organized to do business
      under the laws of Delaware or Georgia) as the Agent may require, a favorable
      opinion of counsel to each such Guarantor in the state in which it is formed
      or
      organized to do business (as approved by the Agent), in form similar to that
      furnished with respect to the Guarantors formed or organized to do business
      under the laws of Delaware or Georgia and reasonably satisfactory to the
      Agent;

     

    (11) Partnership
      agreement.
      A true
      and complete copy of the limited partnership agreement of each limited
      partnership Guarantor, including without limitation any and all amendments
      and
      modifications thereto, and any and all filed partnership
      certificates;

     

    
      
        
        

      

      
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    (12) Limited
      Liability Company Documents.
      A true
      and complete copy of the limited liability company agreement or operating
      agreement of each limited liability company Guarantor, including without
      limitation any and all amendments and modifications thereto, and a certified
      copy of such Guarantor’s certificate of formation;

     

    (13) Good
      Standing Certificates.
      For
      each Guarantor a certificate of good standing from the appropriate governmental
      officer in its jurisdiction of incorporation or formation; and

     

    (14) Other
      Documents.
      Such
      other and further documents as any Lender or its counsel may have reasonably
      requested.

     

    Notwithstanding
      the foregoing, the parties hereto acknowledge and agree that the Agent, at
      its
      election, may waive, with respect to the Guarantors, the requirement for
      delivery of the documents identified in items (8), (11) and (12)
      above.

     

    Section
      3.02   Conditions
      Precedent to All Loans.
      The
      obligation of each Lender to make each Loan (including, in the case of the
      Swing
      Line Lender, any Swing Line Loan) shall be subject to the further conditions
      precedent that (except as hereinafter provided) on the date of such
      Loan:

     

    
      	 	
              (1)

            	
              The
                following statements shall be true and the Agent shall have received
                a
                certificate, substantially in the form of the certificate attached
                hereto
                as Exhibit
                D,
                signed by a duly authorized officer of the Borrower dated the date
                of such
                Loan, stating that:

            

    

     

    
      	 	
              (a)

            	
              The
                representations and warranties contained in Article IV of this Agreement
                are correct in all material respects on and as of the date of such
                Loan as
                though made on and as of such date except to the extent that any
                such
                representation or warranty is stated to relate solely to an earlier
                date,
                in which case such representation or warranty is correct in all material
                respects as of such earlier date;

            

    

     

    
      	 	
              (b)

            	
              No
                Default or Event of Default has occurred and is continuing, or would
                result from such Loan; and

            

    

     

    
      	 	
              (c)

            	
              If
                applicable under Section 7.03, upon the making of the requested Loans,
                the
                aggregate outstanding amount of Borrowing Base Debt shall not exceed
                the
                Borrowing Base as of the most recent Inventory Valuation Date;
                and

            

    

     

    
      	 	
              (2)

            	
              The
                Agent shall have received such other approvals, opinions, or documents
                as
                any Lender through the Agent may reasonably
                request.

            

    

     

    Notwithstanding
      the foregoing, in the case of a Loan (provided for in Section 2.20(d)) made
      to
      repay a Swing Line Loan, the satisfaction of the foregoing conditions with
      respect to such Swing Line Loan shall constitute satisfaction of such conditions
      with respect to the Loan made on the next succeeding Business Day to repay
      such
      Swing Line Loan.

     

    
      
        
        

      

      
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    ARTICLE
      IV

    REPRESENTATIONS
      AND WARRANTIES

     

    The
      Borrower represents and warrants that:

     

    Section
      4.01   Incorporation,
      Formation, Good Standing, and Due Qualification.
      The
      Borrower, each Subsidiary, and each of the Guarantors is (in the case of a
      corporation) a corporation duly incorporated or (in the case of a limited
      partnership) a limited partnership duly formed or (in the case of a limited
      liability company) a limited liability company duly formed, validly existing,
      and in good standing under the laws of the jurisdiction of its incorporation
      or
      formation; has the power and authority to own its assets and to transact the
      business in which it is now engaged or proposed to be engaged in; and is duly
      qualified and in good standing under the laws of each other jurisdiction in
      which such qualification is required.

     

    Section
      4.02   Power
      and Authority.
      The
      execution, delivery and performance by the Borrower and the Guarantors of the
      Loan Documents to which each is a party have been duly authorized by all
      necessary corporate, partnership or limited liability company action, as the
      case may be, and do not and will not (1) require any consent or approval of
      the
      stockholders of such corporation, partners of such partnership or members of
      such limited liability company (except such consents as have been obtained
      as of
      the date hereof); (2) contravene such corporation’s charter or bylaws, such
      partnership’s partnership agreement or such limited liability company’s articles
      or certificate of formation or operating agreement; (3) violate, in any material
      respect, any provision of any law, rule, regulation (including, without
      limitation, Regulations U and X of the Board of Governors of the Federal Reserve
      System), order, writ, judgment, injunction, decree, determination, or award
      presently in effect having applicability to such corporation, partnership or
      limited liability company; (4) result in a breach of or constitute a default
      under any indenture or loan or credit agreement or any other material agreement,
      lease, or instrument to which such corporation, partnership or limited liability
      company is a party or by which it or its properties may be bound or affected;
      (5) result in, or require, the creation or imposition of any Lien, upon or
      with
      respect to any of the properties now owned or hereafter acquired by such
      corporation, partnership or limited liability company; and (6) cause such
      corporation, partnership or limited liability company to be in default, in
      any
      material respect, under any such law, rule, regulation, order, writ, judgment,
      injunction, decree, determination, or award or any such indenture, agreement,
      lease or instrument.

     

    Section
      4.03   Legally
      Enforceable Agreement.
      This
      Agreement is, and each of the other Loan Documents when delivered under this
      Agreement will be legal, valid, and binding obligations of the Borrower or
      each
      Guarantor, as the case may be, enforceable against the Borrower or each
      Guarantor, as the case may be, in accordance with their respective terms, except
      to the extent that such enforcement may be limited by applicable bankruptcy,
      insolvency, and other similar laws affecting creditors’ rights
      generally.

     

    Section
      4.04   Financial
      Statements.
      The
      consolidated balance sheet of the Borrower and its Subsidiaries as at March
      31,
      2007, and the consolidated statements of operations, cash flow and changes
      to
      stockholders’ equity of the Borrower and its Subsidiaries for the period of two
      fiscal quarters ended March 31, 2007, are complete and correct and fairly
      present as at such date the financial condition of the Borrower and its
      Subsidiaries and the results of their operations for the periods covered by
      such
      statements, all in 

     

    
      
        
        

      

      
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    accordance
      with GAAP consistently applied (subject to year-end adjustments), and since
      March 31, 2007, there has been no material adverse change in the condition
      (financial or otherwise), business, or operations of the Borrower and its
      Subsidiaries. There are no liabilities of the Borrower or any Subsidiary, fixed
      or contingent, which are material but are not reflected in the financial
      statements or in the notes thereto, other than liabilities arising in the
      ordinary course of business since March 31, 2007. No information, exhibit,
      or
      report furnished by the Borrower to any Lender in connection with the
      negotiation of this Agreement, taken together, contained any material
      misstatement of fact or omitted to state a material fact or any fact necessary
      to make the statements contained therein not materially misleading.

     

    Section
      4.05   Labor
      Disputes and Acts of God.
      Neither
      the business nor the properties of the Borrower or any Subsidiary or any
      Guarantor are affected by any fire, explosion, accident, strike, lockout, or
      other labor dispute, drought, storm, hail, earthquake, embargo, act of God
      or of
      the public enemy, or other casualty (whether or not covered by insurance),
      materially and adversely affecting such business or properties or the operation
      of the Borrower or such Subsidiary or such Guarantor.

     

    Section
      4.06   Other
      Agreements.
      Neither
      the Borrower nor any Significant Subsidiary nor any Significant Guarantor is
      a
      party to any indenture, loan, or credit agreement, or to any lease or other
      agreement or instrument or subject to any charter, corporate or other
      restriction which could have a material adverse effect on the business,
      properties, assets, operations, or conditions, financial or otherwise, of the
      Borrower or any Significant Subsidiary or any Significant Guarantor, or the
      ability of the Borrower or any Significant Guarantor to carry out its
      obligations under the Loan Documents to which it is a party. Neither the
      Borrower nor any Significant Subsidiary nor any Significant Guarantor is in
      default in any material respect in the performance, observance, or fulfillment
      of any of the obligations, covenants, or conditions contained in any agreement
      or instrument material to its business to which it is a party.

     

    Section
      4.07   Litigation.
      Except
      as disclosed in Schedules
      4.07
      or
4.14
      hereto
      or reflected in or reserved for in the financial statements referred to in
      Section 4.04, there is no pending or, to the knowledge of the Borrower or any
      Guarantor, threatened action or proceeding against or affecting the Borrower
      or
      any Significant Subsidiary or any Significant Guarantor before any court,
      governmental agency, or arbitrator, which may, in any one case or in the
      aggregate, materially adversely affect the financial condition, operations,
      properties, or business of the Borrower or any Significant Subsidiary or any
      Significant Guarantor or the ability of the Borrower or any Significant
      Guarantor to perform its obligations under the Loan Documents to which it is
      a
      party.

     

    Section
      4.08   No
      Defaults on Outstanding Judgments or Orders.
      Except
      for judgments with respect to which the liability of the Borrower, each
      Significant Subsidiary and each Significant Guarantor does not exceed
      $10,000,000 in the aggregate for all such judgments, (a) the Borrower, each
      Significant Subsidiary and each Significant Guarantor have satisfied all
      judgments, and (b) neither the Borrower nor any Significant Subsidiary nor
      any
      Significant Guarantor is in default with respect to any judgment, writ,
      injunction, decree, ruling or order of any court, arbitrator, or federal, state,
      municipal, or other governmental authority, commission, board, bureau, agency,
      or instrumentality, domestic or foreign.

     

    
      
        
        

      

      
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    Section
      4.09   Ownership
      and Liens.
      The
      Borrower and each Subsidiary and each Guarantor have title to, or valid
      leasehold interests in, all of their respective properties and assets, real
      and
      personal, including the properties and assets and leasehold interests reflected
      in the financial statements referred to in Section 4.04 (other than any
      properties or assets disposed of in the ordinary course of business), and none
      of the properties and assets owned by the Borrower or any Subsidiary or any
      Guarantor and none of their leasehold interests is subject to any Lien, except
      such as may be permitted pursuant to Section 6.01.

     

    Section
      4.10   Subsidiaries
      and Ownership of Stock.
      Set
      forth in Schedule
      4.10
      hereto
      is a complete and accurate list of the Subsidiaries of the Borrower, showing
      the
      jurisdiction of incorporation or formation of each and showing the percentage
      of
      the Borrower’s ownership of the outstanding stock or partnership interest or
      membership interest of each Subsidiary. All of the outstanding capital stock
      of
      each such corporate Subsidiary has been validly issued, is fully paid and
      nonassessable, and is owned by the Borrower free and clear of all Liens. The
      limited partnership agreement of each such limited partnership Subsidiary is
      in
      full force and effect and has not been amended or modified, except for such
      amendments or modifications as are delivered to the Agent under Section
      3.01(11). Each of the Guarantors is a Wholly-Owned Subsidiary of the
      Borrower.

     

    Section
      4.11   ERISA.
      The
      Borrower and each Subsidiary and each Guarantor are in compliance in all
      material respects with all applicable provisions of ERISA. Neither a Reportable
      Event nor a Prohibited Transaction has occurred and is continuing with respect
      to any Plan; no notice of intent to terminate a Plan has been filed, nor has
      any
      Plan been terminated; no circumstances exist which constitute grounds entitling
      the PBGC to institute proceedings to terminate, or appoint a trustee to
      administer, a Plan, nor has the PBGC instituted any such proceedings; neither
      the Borrower nor any Commonly Controlled Entity has completely or partially
      withdrawn from a Multiemployer Plan under circumstances that could subject
      the
      Borrower or any Subsidiary to material withdrawal liability; the Borrower and
      each Commonly Controlled Entity have met their minimum funding requirements
      under ERISA with respect to all of their Plans and the present value of all
      vested benefits under each Plan does not materially exceed the fair market
      value
      of all Plan assets allocable to such benefits, as determined on the most recent
      valuation date of the Plan and in accordance with the provisions of ERISA;
      and
      neither the Borrower nor any Commonly Controlled Entity has incurred any
      material liability to the PBGC under ERISA.

     

    Section
      4.12   Operation
      of Business.
      The
      Borrower, each Subsidiary and each Guarantor possess all licenses, permits,
      franchises, patents, copyrights, trademarks, and trade names, or rights thereto,
      to conduct their respective businesses substantially as now conducted and as
      presently proposed to be conducted and the Borrower and each of its Subsidiaries
      and each Guarantor are not in violation of any valid rights of others with
      respect to any of the foregoing where the failure to possess such licenses,
      permits, franchises, patents, copyrights, trademarks, trade names or rights
      thereto or the violation of the valid rights of others with respect thereto
      may,
      in any one case or in the aggregate, adversely affect in any material respect
      the financial condition, operations, properties, or business of the Borrower
      or
      any Significant Subsidiary or any Significant Guarantor or the ability of the
      Borrower or any Significant Guarantor to perform its obligation under the Loan
      Documents to which it is a party.

     

    
      
        
        

      

      
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    Section
      4.13   Taxes.
      All
      federal and state income tax liabilities or income tax obligations, and all
      other material income tax liabilities or material income tax obligations, of
      the
      Borrower, each Subsidiary and each Guarantor have been paid or have been accrued
      by or reserved for by the Borrower. The Borrower constitutes the parent of
      an
      affiliated group of corporations for purposes of filing a consolidated United
      States federal income tax return.

     

    Section
      4.14   Laws;
      Environment.
      Except
      as disclosed in Schedule
      4.14
      hereto,
      (a) the Borrower, each Subsidiary and each Guarantor have duly complied, and
      their businesses, operations, assets, equipment, property, leaseholds, or other
      facilities are in compliance, in all material respects, with the provisions
      of
      all federal, state, and local statutes, laws, codes, and ordinances and all
      rules and regulations promulgated thereunder (including without limitation
      those
      relating to the environment, health and safety), except where the failure to
      so
      comply could not reasonably be expected to, in any one case or in the aggregate,
      adversely affect in any material respect the financial condition, operations,
      properties or business of the Borrower or any Subsidiary or the ability of
      the
      Borrower or any Guarantor to perform its obligations under the Loan Documents
      to
      which it is a party; (b) the Borrower, each Subsidiary and each Guarantor have
      been issued and will maintain all required federal, state, and local permits,
      licenses, certificates, and approvals relating to (1) air emissions; (2)
      discharges to surface water or groundwater; (3) noise emissions; (4) solid
      or
      liquid waste disposal; (5) the use, generation, storage, transportation, or
      disposal of toxic or hazardous substances or hazardous wastes (intended hereby
      and hereafter to include any and all such materials listed in any federal,
      state, or local law, code, or ordinance and all rules and regulations
      promulgated thereunder as hazardous); or (6) other environmental, health or
      safety matters, to the extent for any of the foregoing that failure to maintain
      the same may, in any one case or in the aggregate, adversely affect in any
      material respect the financial condition, operations, properties, or business
      of
      the Borrower or any Significant Subsidiary or any Significant Guarantor or
      the
      ability of the Borrower or any Significant Guarantor to perform its obligations
      under the Loan Documents to which it is a party; (c) neither the Borrower nor
      any Subsidiary nor any Guarantor has received notice of, or has actual knowledge
      of any violations of any federal, state, or local environmental, health, or
      safety laws, codes or ordinances or any rules or regulations promulgated
      thereunder with respect to its businesses, operations, assets, equipment,
      property, leaseholds, or other facilities, which violation may, in any one
      case
      or in the aggregate, adversely affect in any material respect the financial
      condition, operations, properties, or business of the Borrower or any
      Significant Subsidiary or any Significant Guarantor or the ability of the
      Borrower or any Significant Guarantor to perform its obligations under the
      Loan
      Documents to which it is a party; (d) except in accordance with a valid
      governmental permit, license, certificate or approval, there has been no
      material emission, spill, release, or discharge into or upon (1) the air; (2)
      soils, or any 

     

    
      
        
        

      

      
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    improvements
      located thereon; (3) surface water or groundwater; or (4) the sewer, septic
      system or waste treatment, storage or disposal system servicing the premises,
      of
      any toxic or hazardous substances or hazardous wastes at or from the premises,
      in each case related to the premises of the Borrower, each Subsidiary and each
      Guarantor; and accordingly the premises of the Borrower, each Subsidiary and
      each Guarantor have not been adversely affected, in any material respect, by
      any
      toxic or hazardous substances or wastes; (e) there has been no complaint, order,
      directive, claim, citation, or notice by any governmental authority or any
      person or entity with respect to violations of law or damages by reason of
      Borrower’s or any Subsidiary’s (1) air emissions; (2) spills, releases, or
      discharges to soils or improvements located thereon, surface water, groundwater
      or the sewer, septic system or waste treatment, storage or disposal systems
      servicing the premises; (3) noise emissions; (4) solid or liquid waste disposal;
      (5) use, generation, storage, transportation, or disposal of toxic or hazardous
      substances or hazardous waste; or (6) other environmental, health or safety
      matters affecting the Borrower, any Subsidiary or any Guarantor or its business,
      operations, assets, equipment, property, leaseholds, or other facilities; and
      (f) neither the Borrower nor any Subsidiary nor any Guarantor has any material
      indebtedness, obligation, or liability, absolute or contingent, matured or
      not
      matured, with respect to the storage, treatment, cleanup, or disposal of any
      solid wastes, hazardous wastes, or other toxic or hazardous substances
      (including without limitation any such indebtedness, obligation, or liability
      with respect to any current regulation, law, or statute regarding such storage,
      treatment, cleanup, or disposal).

     

    Section
      4.15   Investment
      Company Act.
      Neither
      the Borrower nor any Subsidiary thereof is an “investment company” or a company
“controlled” by an “investment company,” within the meaning of the Investment
      Company Act of 1940, as amended.

     

    Section
      4.16   OFAC.
      Neither
      Borrower nor any Guarantor is (or will be) a person with whom any Lender is
      restricted from doing business under regulations of the Office of Foreign Asset
      Control (“OFAC”) of the Department of the Treasury of the United States of
      America (including, those Persons named on OFAC’s Specially Designated and
      Blocked Persons list) or under any statute, executive order (including, the
      September 24, 2001 Executive Order Blocking Property and Prohibiting
      Transactions With Persons Who Commit, Threaten to Commit, or Support Terrorism),
      or other governmental action and is not and shall not engage in any dealings
      or
      transactions or otherwise be associated with such persons. In addition, Borrower
      hereby agrees to provide to any Lender with any additional information that
      such
      Lender deems necessary from time to time in order to ensure compliance with
      all
      applicable Laws concerning money laundering and similar activities.

     

    Section
      4.17   Accuracy
      of Information.
      The
      representations and warranties by the Borrower or any Guarantor contained herein
      or in any other Loan Document or made hereunder or in any other Loan Document
      and the certificates, schedules, exhibits, reports or other documents provided
      or to be provided by the Borrower or any Guarantor in connection with the
      transactions contemplated hereby or thereby (including, without limitation,
      the
      negotiation of and compliance with the Loan Documents), when taken together
      as a
      whole, do not contain and will not contain a misstatement of a material fact
      or
      omit to state a material fact required to be stated therein in order to make
      the
      statements contained therein, in the light of the circumstances under which
      made, not misleading at the time such statements were made or are deemed
      made.

     

    ARTICLE
      V

    AFFIRMATIVE
      COVENANTS

     

    So
      long
      as any Note shall remain unpaid or any Facility Letter of Credit Obligations
      shall remain outstanding or any Lender shall have any Commitment under this
      Agreement, the Borrower will (unless otherwise agreed to by the Required Lenders
      in writing):

     

    Section
      5.01   Maintenance
      of Existence.
      Preserve and maintain, and cause each Subsidiary to preserve and maintain
      (except for a Subsidiary that ceases to maintain its existence solely as a
      result of an Internal Reorganization), its corporate, limited partnership or
      limited liability company existence and good standing in the jurisdiction of
      its
      incorporation or formation and qualify and remain qualified to transact business
      in each jurisdiction in which such qualification is required except where the
      failure to so qualify to transact business could not reasonably be expected
      to
      affect in any material respect the financial condition, operations, properties
      or business of the Borrower or any Subsidiary.

     

    
      
        
        

      

      
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    Section
      5.02   Maintenance
      of Records.
      Keep
      and cause each Subsidiary to keep, adequate records and books of account, in
      which complete entries will be made in accordance with GAAP consistently
      applied, reflecting all financial transactions of the Borrower and its
      Subsidiaries.

     

    Section
      5.03   Maintenance
      of Properties.
      Maintain, keep, and preserve, and cause each Subsidiary to maintain, keep,
      and
      preserve, all of its properties (tangible and intangible) necessary or useful
      in
      the proper conduct of its business in good working order and condition, ordinary
      wear and tear excepted.

     

    Section
      5.04   Conduct
      of Business.
      Continue, and cause each Subsidiary to continue (except in the case of a
      Subsidiary that ceases to engage in business solely as a result of an Internal
      Reorganization), to engage in a business of the same general type and in the
      same manner as conducted by it on the date of this Agreement.

     

    Section
      5.05   Maintenance
      of Insurance.
      Maintain, and cause each Subsidiary to maintain, insurance with financially
      sound reputable insurance companies or associations (or, in the case of
      insurance for construction warranties and builder default protection for buyers
      of Housing Units from the Borrower or any of its Subsidiaries or UHIC) in such
      amounts and covering such risks as are usually carried by companies engaged
      in
      the same or a similar business and similarly situated, which insurance may
      provide for reasonable deductibility from coverage thereof.

     

    Section
      5.06   Compliance
      with Laws.
      Comply,
      and cause each Subsidiary to comply, in all material respects with all
      applicable laws, rules, regulations, and orders, the noncompliance with which
      could not reasonably be expected to, in any one case or in the aggregate,
      adversely affect in any material respect the financial condition, operations,
      properties or business of the Borrower or any Subsidiary or the ability of
      the
      Borrower or any Guarantor to perform its obligations under the Loan Documents
      to
      which it is a party, and such compliance to include, without limitation, paying
      before the same become delinquent all taxes, assessments and governmental
      charges imposed upon it or upon its property, other than any such taxes,
      assessments and charges being contested by the Borrower in good faith which
      will
      not have a material adverse effect on the financial condition of the Borrower;
      and with respect to the matters disclosed in Schedule
      4.14,
      implement prudent measures to achieve compliance with all relevant laws and
      regulations within a reasonable time and in accordance with requirements
      negotiated with applicable regulatory agencies.

     

    Section
      5.07   Right
      of Inspection.
      At any
      reasonable time and from time to time, permit any Lender or any agent or
      representative thereof to examine and make copies of and abstracts from the
      records and books of account of, and visit the properties of, the Borrower
      and
      any Subsidiary, and to discuss the affairs, finances, and accounts of the
      Borrower and any Subsidiary with any of their respective officers and directors
      and the Borrower’s independent accountants.

     

    
      
        
        

      

      
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    Section
      5.08   Reporting
      Requirements.
      Furnish
      to the Agent for delivery to each of the Lenders:

     

    (1) Quarterly
      financial statements.
      As soon
      as available and in any event within fifty (50) days after the end of each
      of
      the first three quarters of each fiscal year of the Borrower, an unaudited
      condensed consolidated balance sheet of the Borrower and its Subsidiaries as
      of
      the end of such quarter, unaudited condensed consolidated statements of
      operations and cash flow of the Borrower and its Subsidiaries for the period
      commencing at the end of the previous fiscal year and ending with the end of
      such quarter, and unaudited condensed consolidated statements of changes in
      stockholders’ equity of the Borrower and its Subsidiaries for the portion of the
      fiscal year ended with the last day of such quarter, all in reasonable detail
      and stating in comparative form the respective figures for the corresponding
      date and period in the previous fiscal year and all prepared in accordance
      with
      GAAP consistently applied and certified by the chief financial officer of the
      Borrower (subject to year-end adjustments); the timely filing by the Borrower
      of
      the Borrower’s quarterly 10-Q report with the Securities and Exchange Commission
      shall satisfy the foregoing requirements.

     

    (2) Annual
      financial statements.
      As soon
      as available and in any event within ninety-five (95) days after the end of
      each
      fiscal year of the Borrower, a consolidated balance sheet of the Borrower and
      its Subsidiaries as of the end of such fiscal year, consolidated statements
      of
      operations and cash flow of the Borrower and its Subsidiaries for such fiscal
      year, and consolidated statements of changes in stockholders’ equity of the
      Borrower and its Subsidiaries for such fiscal year, all in reasonable detail
      and
      stating in comparative form the respective figures for the corresponding date
      and period in the prior fiscal year and all prepared in accordance with GAAP
      consistently applied and accompanied by an opinion thereon acceptable to the
      Agent by Deloitte & Touche or other independent accountants selected by the
      Borrower and acceptable to the Agent; the timely filing by the Borrower of
      the
      Borrower’s annual 10-K report with the Securities and Exchange Commission shall
      satisfy the foregoing requirements.

     

    (3) Financial
      projections.
      On
      August 15, 2007 and each anniversary thereof, two-year financial projections
      (including a consolidated income statement, balance sheet and statement of
      cash
      flows for the Borrower and its Subsidiaries) broken down by quarters, and as
      soon as available (but not later than June 15 of each year), a mid-year update
      of the financial projections for the current year.

     

    (4) Variance
      analysis.
      (a)
      Within fifty (50) days of the end of each of the first three fiscal quarters
      of
      each fiscal year of the Borrower, a quarterly variance analysis comparing actual
      quarterly results versus the most recently projected quarterly results for
      the
      fiscal quarter most recently ended (including consolidated income statements
      of
      the Borrower and its Subsidiaries, an analysis of revenues, closings and
      operating profits of the Borrower and each Subsidiary on a state by state basis,
      and such other items as are requested by any of the Lenders), together with
      a
      written explanation of material variances.

     

    
      
        
        

      

      
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    (b) Within
      ninety-five (95) days after the end of each fiscal year of the Borrower, a
      quarterly variance analysis comparing actual quarterly results versus the most
      recently projected quarterly results for the fiscal year most recently ended
      (including consolidated income statements of the Borrower and its Subsidiaries
      accompanied by an opinion thereon acceptable to the Agent by Deloitte &
Touche or other independent accountants selected by the Borrower and acceptable
      to the Agent, an analysis of revenues, closings and operating profits of the
      Borrower and each Subsidiary on a state by state basis, and such other items
      as
      are requested by any of the Lenders), together with a written explanation of
      material variances.

     

    (5) Management
      letters.
      Promptly upon receipt thereof, copies of any reports submitted to the Borrower
      or any Subsidiary by independent certified public accountants in connection
      with
      examination of the financial statements of the Borrower or any Subsidiary made
      by such accountants.

     

    (6) Borrowing
      Base Certificate.
      Within
      thirty-five (35) days after the end of each calendar month (without regard
      to
      whether the provisions of Sections 2.01.3 and 7.03 are then applicable), a
      Borrowing Base Certificate, with respect to the Inventory Valuation Date
      occurring on the last day of such calendar month.

     

    (7) Compliance
      certificate.
      Within
      fifty (50) days after the end of each of the first three quarters, and within
      ninety-five (95) days after the end of each fourth quarter, of each fiscal
      year
      of the Borrower, a certificate of the President or chief financial officer
      of
      the Borrower certifying (a) the Borrower’s compliance with all financial
      covenants including, without limitation, those set forth in Section 6.10 and
      Article VII hereof, which certificate shall set forth in reasonable detail
      the
      computation thereof and (b) certifying that to the best of his knowledge no
      Default or Event of Default has occurred and is continuing, or if a Default
      or
      Event of Default has occurred and is continuing, a statement as to the nature
      thereof and the action which is proposed to be taken with respect
      thereto.

     

    (8) Land
      Bank Inventory.
      Within
      fifty (50) days after the end of each of the first three quarters, and within
      ninety-five (95) days after the end of each fourth quarter, of each fiscal
      year
      of the Borrower, a certificate of the President or Chief Operating Officer
      of
      the Borrower certifying the Land as at such date, which lists by state of
      location all Land, delineating Finished Lots, Lots under Development, Entitled
      Land and estimated undeveloped Lots.

     

    (9) Accountant’s
      report.
      Simultaneously with the delivery of the annual financial statements referred
      to
      in Section 5.08(2), a certificate of the independent public accountants who
      audited such statements to the effect that, in making the examination necessary
      for the audit of such statements, they have obtained no knowledge of any
      condition or event which constitutes a Default or Event of Default, or if such
      accountants shall have obtained knowledge of any such condition or event,
      specifying in such certificate each such condition or event of which they have
      knowledge and the nature and status thereof.

     

    (10) Notice
      of litigation.
      Promptly after the commencement thereof, notice of all actions, suits, and
      proceedings before any court or governmental department, commission, board,
      bureau, agency, or instrumentality, domestic or foreign, affecting the Borrower
      or any Subsidiary which, if determined adversely to the Borrower or such
      Subsidiary, would reasonably be expected to result in a judgment against the
      Borrower or such Subsidiary in excess of $10,000,000 (to the extent not covered
      by insurance) or would reasonably be expected to have a material adverse effect
      on the financial condition, properties, or operations of the Borrower or such
      Subsidiary.

     

    
      
        
        

      

      
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    (11) Notice
      of Defaults and Events of Default.
      As soon
      as possible and in any event within ten (10) days after the occurrence of each
      Default or Event of Default, a written notice setting forth the details of
      such
      Default or Event of Default and the action which is proposed to be taken by
      the
      Borrower with respect thereto.

     

    (12) ERISA
      reports.
      As soon
      as possible, and in any event within thirty (30) days after the Borrower knows
      or has reason to know that any circumstances exist that constitute grounds
      entitling the PBGC to institute proceedings to terminate a Plan subject to
      ERISA
      with respect to the Borrower or any Commonly Controlled Entity, and promptly
      but
      in any event within two (2) Business Days of receipt by the Borrower or any
      Commonly Controlled Entity of notice that the PBGC intends to terminate a Plan
      or appoint a trustee to administer the same, and promptly but in any event
      within five (5) Business Days of the receipt of notice concerning the imposition
      of withdrawal liability in excess of $50,000 with respect to the Borrower or
      any
      Commonly Controlled Entity, the Borrower will deliver to each Lender a
      certificate of the chief financial officer of the Borrower setting forth all
      relevant details and the action which the Borrower proposes to take with respect
      thereto.

     

    (13) Reports
      to other creditors.
      Promptly after the furnishing thereof, copies of any statement, report,
      document, notice, certificate, and correspondence furnished to any other party
      pursuant to the terms of any indenture, loan, credit, or similar agreement
      and
      not otherwise required to be furnished to the Lenders pursuant to any other
      clause of this Section 5.08.

     

    (14) Proxy
      statements, etc.
      Promptly
      after the sending or filing thereof, copies of all proxy statements, financial
      statements, and reports which the Borrower or any Subsidiary sends to its
      stockholders, and copies of all regular, periodic, and special reports, and
      all
      registration statements which the Borrower or any Subsidiary files with the
      Securities and Exchange Commission or any governmental authority which may
      be
      substituted therefor, or with any national securities exchange.

     

    (15) Borrowing
      Base Certificate Prior to Acquisition.
      Not
      less than ten (10) days prior to the consummation of any Permitted Acquisition
      (without regard to whether the provisions of Sections 2.01.3 and 7.03 are then
      applicable), a Borrowing Base Certificate that includes all assets that would
      have been included in the Borrowing Base had the Permitted Acquisition been
      consummated as of the last day of the most recent calendar month, provided,
      however, that such Borrowing Base Certificate shall expressly state that it
      is
      delivered in anticipation of, and shall only be effective hereunder (if then
      applicable) for purposes of Borrowings made at the time of or after, the
      consummation of such Permitted Acquisition (it being understood that, until
      the
      consummation of such Permitted Acquisition, the previously delivered Borrowing
      Base Certificate shall remain in effect) and shall further expressly state
      that,
      before and after giving effect to such Acquisition, no Default or Event of
      Default has occurred and is continuing.

     

    
      
        
        

      

      
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    (16) General
      information.
      Such
      other information respecting the condition or operations, financial or
      otherwise, of the Borrower or any Subsidiary as any Lender may from time to
      time
      reasonably request.

     

    Section
      5.09   Subsidiary
      Reporting Requirements.
      In the
      event any of the following statements are prepared with respect to any
      Subsidiary, then upon written request from any Lender, furnish to the Agent
      for
      delivery to each of the Lenders the following with respect to any
      Subsidiary:

     

    (1) Quarterly
      financial statements.
      An
      unaudited balance sheet of such Subsidiary as of the end of most recently
      completed fiscal quarter, statements of operations and cash flow of such
      Subsidiary for the period commencing at the end of the previous fiscal year
      and
      ending with the end of such quarter, and statements of changes in stockholders’
equity of such Subsidiary for the portion of the fiscal year ended with the
      last
      day of such quarter, all in reasonable detail and stating in comparative form
      the respective figures for the corresponding date and period in the previous
      fiscal year and all prepared in accordance with GAAP consistently applied and
      certified by the chief financial officer of such Subsidiary (subject to year-end
      adjustments).

     

    (2) Annual
      financial statements.
      A
      balance sheet of such Subsidiary as of the end of such fiscal year, statements
      of operations and cash flow of such Subsidiary for such fiscal year, and
      statements of changes in stockholders’ equity of such Subsidiary for such fiscal
      year, all in reasonable detail and stating in comparative form the respective
      figures for the corresponding date and period in the prior fiscal year and
      all
      prepared in accordance with GAAP consistently applied and as to the consolidated
      statements accompanied by an opinion thereon reasonably acceptable to the Agent
      by Deloitte & Touche or other independent accountants selected by the
      Borrower and reasonably acceptable to the Agent.

     

    Section
      5.10   Environment.
      Be and
      remain, and cause each Subsidiary to be and remain, in compliance with the
      provisions of all federal, state, and local environmental, health, and safety
      laws, codes and ordinances, and all rules and regulations issued thereunder,
      except where the failure to so comply could not reasonably be expected to,
      in
      any one case or in the aggregate, adversely affect in any material respect
      the
      financial condition, operations, properties or business of the Borrower or
      any
      Subsidiary or the ability of the Borrower or any Guarantor to perform its
      obligations under the Loan Documents to which it is a party; with respect to
      matters disclosed in Schedule
      4.14,
      implement prudent measures to achieve compliance with all relevant laws and
      regulations within a reasonable time and in accordance with requirements
      negotiated with applicable regulatory agencies; notify the Agent promptly of
      any
      notice of a hazardous discharge or environmental complaint received from any
      governmental agency or any other party (and the Agent shall notify the Lenders
      promptly following its receipt of any such notice from the Borrower); notify
      the
      Agent promptly of any hazardous discharge from or affecting its premises if
      (i)
      the storage, treatment or cleanup of such hazardous discharge (all in accordance
      with applicable laws and regulations) or (ii) the diminution in the value of
      the
      assets affected by such hazardous discharge, is reasonably expected to exceed
      $10,000 (and the Agent shall notify the Lenders promptly following its receipt
      of any such notice from the Borrower); promptly contain and remove the

     

    
      
        
        

      

      
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    same,
      in
      compliance with all applicable laws; promptly pay any fine or penalty assessed
      in connection therewith; permit any Lender to inspect the premises, to conduct
      tests thereon, and to inspect all books, correspondence, and records pertaining
      thereto; and at such Lender’s request, and at the Borrower’s expense, provide a
      report of a qualified environmental engineer, satisfactory in scope, form,
      and
      content to the Required Lenders, and such other and further assurances
      reasonably satisfactory to the Required Lenders that the condition has been
      corrected.

     

    Section
      5.11   Use
      of Proceeds.
      Use the
      proceeds of the Loans solely as provided in Section 2.13.

     

    Section
      5.12   Ranking
      of Obligations.
      Ensure
      that at all times its Obligations under the Loan Documents shall be and
      constitute unconditional general obligations of the Borrower ranking at least
      pari passu
      with all
      its other unsecured Debt.

     

    Section
      5.13   Taxes.
      Pay and
      cause each Subsidiary to pay when due all taxes, assessments and governmental
      charges and levies upon it or its income, profits or property, except those
      which are being contested in good faith by appropriate proceedings and with
      respect to which adequate reserves have been set aside.

     

    Section
      5.14   Wholly-Owned
      Status.
      Ensure
      that at all times each of the Guarantors is a Wholly-Owned Subsidiary of the
      Borrower.

     

    Section
      5.15   New
      Subsidiaries.
      Within
      fifty (50) days after the end of any fiscal quarter of the Borrower during
      which
      any Person shall have become a Subsidiary, cause such Subsidiary to execute
      and
      deliver to the Agent, for the benefit of the Lenders, a Supplemental Guaranty
      and an opinion of counsel, certified copies of resolutions, articles of
      incorporation or other formation documents, incumbency certificates and other
      documents with respect to such Subsidiary and its Guaranty substantially similar
      to the documents delivered pursuant to Section 3.01 with respect to the
      Guarantors, all of which shall be reasonably satisfactory to the Agent in form
      and substance; provided that if and so long as any such Subsidiary has total
      assets the book value of which is not more than $5,000,000, the Borrower shall
      not be required to comply with this Section. None of the Title Companies nor
      UHIC nor BMC shall be required to deliver a Guaranty.

     

    ARTICLE
      VI

    NEGATIVE
      COVENANTS

     

    So
      long
      as any Note shall remain unpaid or any Facility Letter of Credit Obligations
      shall remain outstanding or any Lender shall have any Commitment under this
      Agreement, the Borrower and each Guarantor will not (unless otherwise agreed
      to
      by the Required Lenders in writing):

     

    Section
      6.01   Liens.
      Create,
      incur, assume, or suffer to exist, or permit any Subsidiary to create, incur,
      assume, or suffer to exist, any Lien, upon or with respect to any of its
      properties, now owned or hereafter acquired, except the following:

     

    (1) Liens
      for
      taxes or assessments or other government charges or levies if not yet due and
      payable or, if due and payable, if they are being contested in good faith by
      appropriate proceedings and for which appropriate reserves are
      maintained;

     

    
      
        
        

      

      
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    (2) Liens
      imposed by law, such as mechanics’, materialmen’s, landlords’, warehousemen’s,
      and carriers’ Liens, and other similar Liens, securing obligations incurred in
      the ordinary course of business which are not past due for more than ninety
      (90)
      days or which are being contested in good faith by appropriate proceedings
      and
      for which appropriate reserves have been established;

     

    (3) Liens
      under workers’ compensation, unemployment insurance, Social Security, or similar
      legislation (other than Liens imposed by ERISA);

     

    (4) Liens,
      deposits, or pledges to secure the performance of bids, tenders, contracts
      (other than contracts for the payment of money), Capital Leases (permitted
      under
      the terms of this Agreement), public or statutory obligations, surety, stay,
      appeal, indemnity, performance, or other similar bonds, or other similar
      obligations arising in the ordinary course of business;

     

    (5) Judgment
      and other similar Liens arising in connection with any court proceeding,
      provided the execution or other enforcement of such Liens is effectively stayed
      and the claims secured thereby are being actively contested in good faith and
      by
      appropriate proceedings;

     

    (6) Easements,
      rights-of-way, restrictions (including zoning, building and land use
      restrictions), and other similar encumbrances which, in the aggregate, do not
      materially interfere with the occupation, use, and enjoyment by the Borrower
      or
      any Subsidiary of the property or assets encumbered thereby in the normal course
      of its business or materially impair the value of the property subject
      thereto;

     

    (7) Liens
      securing Secured Debt permitted under Section 6.02.

     

    Section
      6.02   Secured
      Debt.
      Create,
      incur, assume or suffer to exist, or permit any Subsidiary to create, incur,
      assume or suffer to exist, any Secured Debt, except for Secured Debt in an
      aggregate amount outstanding at any one time not exceeding (a) $200,000,000
      plus
      (b) the amount (if any ) of any secured Debt of an entity acquired by Borrower
      after the Closing Date, provided that (i) such secured Debt was in existence
      prior to the date of such Acquisition and was not incurred in anticipation
      thereof and (ii) the Liens securing such Debt do not extend to any other assets
      other than those theretofore encumbered by such Liens.

     

    Section
      6.03   Mergers,
      Etc.
      Wind up,
      liquidate or dissolve itself, reorganize, merge or consolidate with or into,
      or
      convey, sell, assign, transfer, lease, or otherwise dispose of (whether in
      one
      transaction or in a series of transactions) all or substantially all of its
      assets (whether now owned or hereafter acquired) to any Person, or acquire
      all
      or substantially all the assets or the business of any Person, or permit any
      Subsidiary to do so, except (1) for any Permitted Acquisition, (2) that any
      Guarantor may merge into or transfer assets to the Borrower as a result of
      an
      Internal Reorganization or otherwise and (3) that any Guarantor may merge into
      or consolidate with or transfer assets to any other Guarantor as a result of
      an
      Internal Reorganization or otherwise.

     

    Section
      6.04   Leases.
      Create,
      incur, assume, or suffer to exist, or permit any Subsidiary to create, incur,
      assume, or suffer to exist, any obligation as lessee for the rental or hire
      of
      any real or personal property, except (1) Capital Leases not otherwise
      prohibited by the terms of this Agreement; (2) leases existing on the date
      of
      this Agreement and any extension or renewals thereof; (3) leases between the
      Borrower and any Subsidiary or between any Subsidiaries; (4) operating leases
      entered into in the ordinary course of business; and (5) any lease of property
      having a value of $500,000 or less.

     

    
      
        
        

      

      
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    Section
      6.05   Sale
      and Leaseback.
      Sell,
      transfer or otherwise dispose of, or permit any Subsidiary to sell, transfer,
      or
      otherwise dispose of, any real or personal property to any Person and thereafter
      directly or indirectly lease back the same or similar property, except for
      the
      sale and leaseback of model homes.

     

    Section
      6.06   Sale
      of Assets.
      Sell,
      lease, assign, transfer, or otherwise dispose of, or permit any Subsidiary
      to
      sell, lease, assign, transfer, or otherwise dispose of, any of its now owned
      or
      hereafter acquired assets (including, without limitation, shares of stock and
      indebtedness of subsidiaries, receivables, and leasehold interests), except
      (a)
      for (1) Inventory disposed of in the ordinary course of business; (2) the sale
      or other disposition of assets no longer used or useful in the conduct of its
      business; or (3) the sale and leaseback of model homes; (b) that any Guarantor
      may sell, lease, assign, or otherwise transfer its assets to the Borrower or
      any
      other Guarantor in connection with an Internal Reorganization or otherwise;
      and
      (c) that the provisions of this Section 6.06 shall not affect or limit the
      Borrower’s obligations under Section 6.03.

     

    Section
      6.07   Investments.
      Make,
      or permit any Subsidiary to make, any loan or advance to any Person, or purchase
      or otherwise acquire, or permit any Subsidiary to purchase or otherwise acquire,
      any capital stock, assets (other than assets acquired in the ordinary course
      of
      business), obligation, or other securities of, make any capital contribution
      to,
      or otherwise invest in or acquire any interest in any Person (other than the
      repurchase of Senior Notes by the Borrower) including, without limitation,
      any
      hostile takeover, hostile tender offer or similar hostile transaction
      (collectively, “Investments”), except: (1) a direct obligation of the United
      States or any agency thereof with maturities of one year or less from the date
      of acquisition; (2) commercial paper rated at least “A-1” by Standard &
Poor’s Corporation or “P-1” by Moody’s Investors Service, Inc.; (3) certificates
      of deposit with maturities of one year or less from the date of acquisition
      issued by any commercial bank or federal savings bank having capital and surplus
      in excess of $250,000,000; (4) a direct obligation of any state or municipality
      within the United States with maturities of one year or less from the date
      of
      acquisition and which, at the time of such acquisition, is accorded one of
      the
      two highest debt ratings for obligations of such type by Standard & Poor’s
      or Moody’s; (5) mutual funds investing in assets of the type described in items
      (1), (2), (3) or (4) above which in any case would be classified as a current
      asset in accordance with GAAP which are managed by a fund manager of recognized
      standing in the United States and having capital and surplus of at least
      $100,000,000 or having at least $250,000,000 under management; (6) stock,
      obligation, or securities received in settlement of debts (created in the
      ordinary course of business) owing to the Borrower or any Subsidiary provided
      such issuance is approved by the board of directors of the issuer thereof;
      (7) a
      loan or advance from the Borrower to a Subsidiary, or from a Subsidiary to
      a
      Subsidiary, or from a Subsidiary to the Borrower (subject, however, to the
      limitations set forth below in the case of Investments in 

     

    
      
        
        

      

      
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    Subsidiaries
      that are not Guarantors); (8) any Permitted Acquisition; (9) an Investment
      in a
      Wholly-Owned Subsidiary, which Investment is, or constitutes a part of, an
      Internal Reorganization (subject, however, to the limitations set forth below
      in
      the case of Investments in Subsidiaries that are not Guarantors); (10)
      Investments in Subsidiaries that are not Guarantors and any Joint Venture
      (subject, however, to the limitations set forth below); or (11) any other
      Investment not identified in clauses (1) though (10) above (subject, however,
      to
      the limitations set forth below); provided
      that the
      aggregate amount of all Investments by the Borrower and its Subsidiaries
      permitted under clauses (10) and (11) above and the contingent obligations
      under
      guaranties permitted under clause (3) of Section 6.08 below does not at any
      time
      exceed thirty-five percent (35%) of Consolidated Tangible Net
      Worth.

     

    Section
      6.08   Guaranties,
      Etc.
      Assume,
      guarantee, endorse, or otherwise be or become directly or contingently
      responsible or liable, or permit any Subsidiary to assume, guarantee, endorse,
      or otherwise be or become directly or contingently responsible or liable
      (including, but not limited to, an agreement to purchase any obligation, stock,
      assets, goods, or services, or to supply or advance any funds, assets, goods,
      or
      services, or an agreement to maintain or cause such Person to maintain a minimum
      working capital or net worth or otherwise to assure the creditors of any Person
      against loss), for obligations of any Person, except: (1) guaranties by
      endorsement of negotiable instruments for deposit or collection or similar
      transactions in the ordinary course of business; (2) guaranties of performance
      obligations in the ordinary course of business; (3) of the Debt or other
      obligations of any Joint Venture or any Subsidiary that is not a Guarantor,
      subject to the limitations set forth in clauses (10) and (11) of Section 6.07
      above and (4) that the Borrower or any Subsidiary or any Guarantor may, whether
      as a result of an Internal Reorganization or otherwise, guarantee the Debt
      of
      any other Subsidiary (other than any Subsidiary that is not a Guarantor) or
      Guarantor or the Borrower permitted under this Agreement.

     

    Section
      6.09   Transactions
      With Affiliates.
      Enter
      into any transaction, including, without limitation, the purchase, sale, or
      exchange of property or the rendering of any service, with any Affiliate, or
      permit any Subsidiary to enter into any transaction, including, without
      limitation, the purchase, sale, or exchange of property or the rendering of
      any
      service, with any Affiliate, except in the ordinary course of and pursuant
      to
      the reasonable requirements of the Borrower’s or such Guarantor’s or any
      Subsidiary’s business and upon fair and reasonable terms no less favorable to
      the Borrower or such Guarantor or any Subsidiary than would obtain in a
      comparable arm’s-length transaction with a Person not an Affiliate (which
      exception shall include the payment of insurance premiums to UHIC for the
      purchase of construction warranties and builder default protection for buyers
      of
      Housing Units from the Borrower or any of its Subsidiaries and to the Title
      Companies for title insurance); provided,
      however,
      that
      the following transactions shall not be prohibited by this Section 6.09: (i)
      transactions involving the purchase, sale or exchange of property having a
      value
      of $500,000 or less; and (ii) transactions otherwise permitted by this
      Agreement.

     

    Section
      6.10   Housing
      Inventory.
      Permit
      the number of Speculative Housing Units, as at the end of any fiscal quarter,
      to
      exceed the greater of (a) the number of Housing Unit Closings occurring during
      the period of twelve (12) months ending on the last day of such fiscal quarter,
      multiplied by thirty percent (30%) or (b) the number of Housing Unit Closings
      occurring during the period of six (6) months ending on the last day of such
      fiscal quarter, multiplied by seventy percent (70%).

     

    
      
        
        

      

      
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    Section
      6.11   Amendment
      or Modification of Senior Indentures.
      Amend
      or modify, or permit any amendment or modification of, any of the Senior
      Indentures (other than those provided for in (a) clauses (7), (8), or (9) of
      Section 9.01 of the Base Indenture 2001, (b) clauses (1), (4), (5) of Section
      9.01 of the Base Indenture 2002, (c) clauses (1), (3), or (6) of Section 13.01
      of the Base Indenture 2004 and (d) any similar provision set forth in any
      indenture entered into after the date hereof in connection with any Refinancing
      Debt with respect to the Senior Notes, in each case as such provisions exist
      on
      the date hereof or, for any indenture under clause (d) above, on the date of
      execution).

     

    Section
      6.12   Non-Guarantors.
      Permit
      UHIC to engage in any business other than the issuance of construction
      warranties and builder default protection for buyers of Housing Units from
      the
      Borrower or any of its Subsidiaries or permit any of the Title Companies to
      engage in any business other than title insurance or permit BMC to engage in
      any
      business other than mortgage banking.

     

    Section
      6.13   Negative
      Pledges.
      Directly
      or indirectly enter into any agreement (other than this Agreement, the Senior
      Indentures and any other similar loan and credit agreements and indentures
      that
      may hereafter be entered into by the Borrower and that evidence Borrowing Base
      Debt) with any Person that prohibits or restricts or limits the ability of
      the
      Borrower or any Guarantor to create, incur, pledge or suffer to exist any Lien
      upon any assets of the Borrower or any Guarantor (except that agreements
      creating or securing Secured Debt permitted under Section 6.02 may prohibit,
      restrict or limit other Liens on those assets encumbered by the Liens securing
      such Secured Debt).

     

    ARTICLE
      VII

    FINANCIAL
      COVENANTS

     

    So
      long
      as any Note shall remain unpaid or any Facility Letter of Credit shall remain
      outstanding or any Lender shall have any Commitment under this Agreement (unless
      otherwise agreed to by the Required Lenders in writing):

     

    Section
      7.01   Minimum
      Consolidated Tangible Net Worth.
      The
      Borrower will maintain at all times a Consolidated Tangible Net Worth of not
      less than the sum (the “Minimum Consolidated Tangible Net Worth”) of (i)
      $1,000,000,000, (ii) an amount equal to fifty percent (50%) of the cumulative
      Net Income of the Borrower earned after March 31, 2007 (excluding any quarter
      in
      which there is a loss), and (iii) fifty percent (50%) of the net proceeds
      received after March 31, 2007 by the Borrower or any Subsidiary from the sale
      or
      issuance of any of its Common Equity. Notwithstanding the foregoing, in the
      event that the Borrower shall at any time consummate an Acquisition for a
      purchase price or other consideration equaling or exceeding $100,000,000, the
      Minimum Consolidated Tangible Net Worth required hereby shall be adjusted to
      be
      the sum of (i) 80% of the Borrower’s Consolidated Tangible Net Worth immediately
      following the closing of such Acquisition, (ii) an amount equal to 50% of the
      cumulative Net Income of the Borrower earned after the closing of such
      Acquisition (excluding any quarter in which there is a loss) and (iii) 50%
      of
      the net proceeds received after the closing of such Acquisition by the Borrower
      or any Subsidiary for the sale or issuance of its Common Equity.

     

    
      
        
        

      

      
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    Section
      7.02   Leverage
      Ratio.
      The
      Borrower will not permit the Leverage Ratio to exceed 1.90 to 1.00 at any
      time.

     

    Section
      7.03   Borrowing
      Base Debt.
      At any
      time at which the senior unsecured long-term debt of the Borrower does not
      have
      a rating of BBB- or higher from S&P or Baa3 or higher from Moody’s, the
      Borrower will not permit the outstanding amount of the Borrowing Base Debt
      to
      exceed the Borrowing Base.

     

    Section
      7.04   Interest
      Coverage Ratio.
      The
      Borrower shall maintain an Interest Coverage Ratio of not less than 1.75 to
      1.00, which ratio shall be determined as of the last day of each fiscal quarter
      for the four-quarter period ending on such day; provided that, notwithstanding
      the foregoing, the Interest Coverage Ratio (i) may be less than 1.75 to 1.00,
      but must exceed 1.10 to 1.00, as of the last day of each fiscal quarter of
      the
      Borrower ending on or before September 30, 2009, and (ii) may be less than
      1.75
      to 1.00, but must exceed 1.50 to 1.00, as of the last day of the fiscal quarter
      of the Borrower ending December 31, 2009, in each case for the four-quarter
      period ending on such day.

     

    Section
      7.05   Land
      Inventory.
      The
      Borrower shall not permit the ratio of (i) Adjusted Land Value to (ii) the
      sum
      of (a) Consolidated Tangible Net Worth plus (b) fifty percent (50%) of
      Consolidated Subordinated Debt to exceed 1.25 to 1.00.

     

    Section
      7.06   Minimum
      Liquidity.
      As of
      the last day of any fiscal quarter for which the Interest Coverage Ratio is
      less
      than 1.75 to 1.00 (as permitted by the provision in Section 7.04), the Borrower
      shall maintain the sum of (i) Unrestricted Cash not included in the Borrowing
      Base and (ii) Borrowing Base Availability, in an amount not less than
      $120,000,000.

     

    ARTICLE
      VIII

    EVENTS
      OF DEFAULT

     

    Section
      8.01   Events
      of Default.
      If any
      of the following events shall occur:

     

    (1) The
      Borrower shall fail to pay (a) the principal of any Note, or any amount of
      a
      commitment or other fee, as and when due and payable or (b) interest on any
      Note
      or any amount of any commitment fee or other fee within five (5) Business Days
      after the same is due and payable;

     

    (2) Any
      representation or warranty made or deemed made by the Borrower or by any
      Guarantor in any Loan Document or which is contained in any certificate,
      document, opinion, or financial or other statement furnished at any time under
      or in connection with this Agreement shall prove to have been incorrect,
      incomplete, or misleading in any material respect on or as of the date made
      or
      deemed made;

     

    (3) The
      Borrower or any Guarantor shall fail to perform or observe any term, covenant,
      or agreement contained in Articles V, VI or VII hereof, and such failure shall
      continue for a period of thirty (30) consecutive days;

     

    
      
        
        

      

      
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    (4) The
      Borrower or any Significant Subsidiary or any Significant Guarantor shall (a)
      fail to pay (within the applicable cure period, if any) any amount in respect
      of
      indebtedness for borrowed money equal to or in excess of $5,000,000 in the
      aggregate (other than the Notes) of the Borrower or such Significant Subsidiary
      or such Significant Guarantor, as the case may be, or any interest or premium
      thereon, when due (whether by scheduled maturity, required prepayment,
      acceleration, demand, or otherwise); or (b) fail to perform or observe any
      term,
      covenant, or condition on its part to be performed or observed (within the
      applicable cure period, if any) under any agreement or instrument relating
      to
      any such indebtedness, when required to be performed or observed, if the effect
      of such failure to perform or observe is to accelerate, or permit the
      acceleration of after the giving of notice or passage of time, or both, the
      maturity of such indebtedness, whether or not such failure to perform or observe
      shall be waived by the holder of such indebtedness; or (c) any such indebtedness
      shall be declared to be due and payable, or required to be prepaid (other than
      by a regularly scheduled required prepayment), repurchased (or an offer to
      repurchase to be made) or redeemed prior to the stated maturity
      thereof;

     

    (5) The
      Borrower or any Significant Subsidiary or any Significant Guarantor (a) shall
      generally not pay, or shall be unable to pay, or shall admit in writing its
      inability to pay its debts as such debts become due; or (b) shall make an
      assignment for the benefit of creditors, or petition or apply to any tribunal
      for the appointment of a custodian, receiver, or trustee for it or a substantial
      part of its assets; or (c) shall commence any proceeding under any bankruptcy,
      reorganization, arrangement, readjustment of debt, dissolution, or liquidation
      law or statute of any jurisdiction, whether now or hereafter in effect; or
      (d)
      shall have had any such petition or application filed or any such proceeding
      commenced against it in which an order for relief is entered or an adjudication
      or appointment is made and which remains undismissed for a period of sixty
      (60)
      days or more; or (e) shall take any corporate action indicating its consent
      to,
      approval of, or acquiescence in any such petition, application, proceeding,
      or
      order for relief or the appointment of a custodian, receiver, or trustee for
      all
      or any substantial part of its properties; or (f) shall suffer any such
      custodianship, receivership, or trusteeship to continue undischarged for a
      period of sixty (60) days or more;

     

    (6) One
      or
      more judgments, decrees, or orders for the payment of money in excess of
      $10,000,000 in the aggregate shall be rendered against the Borrower and/or
      any
      Subsidiary and/or any Guarantor, and such judgments, decrees, or orders shall
      continue unsatisfied and in effect for a period of twenty (20) consecutive
      days
      without being vacated, discharged, satisfied, or stayed or bonded pending
      appeal;

     

    (7) Any
      Guaranty hereunder shall at any time after its execution and delivery and for
      any reason cease to be in full force and effect or shall be declared null and
      void, or the validity or enforceability thereof shall be contested by the
      Guarantor or the Guarantor shall deny it has any further liability or obligation
      under, or shall fail to perform its obligations under, the Guaranty (except
      to
      the extent that the foregoing occurs solely by reason of the liquidation or
      dissolution of a Guarantor as a result of an Internal
      Reorganization);

     

    (8) Any
      Change of Control of the Borrower or any Subsidiary or any Guarantor shall
      occur;

     

    
      
        
        

      

      
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    (9) Any
      of
      the following events shall occur or exist with respect to the Borrower, any
      Subsidiary or any Commonly Controlled Entity under ERISA: any Reportable Event
      shall occur; complete or partial withdrawal from any Multiemployer Plan shall
      take place; any Prohibited Transaction shall occur; a notice of intent to
      terminate a Plan shall be filed, or a Plan shall be terminated; or circumstances
      shall exist which constitute grounds entitling the PBGC to institute proceedings
      to terminate a Plan, or the PBGC shall institute such proceedings; and in each
      case above, such event or condition, together with all other events or
      conditions described in this Section 8.01(9), if any, could subject the Borrower
      or any Significant Guarantor or Significant Subsidiary to any tax, penalty,
      or
      other liability which in the aggregate may exceed $1,000,000;

     

    (10) If
      any
      federal, state, or local agency asserts a material claim against the Borrower
      or
      any Significant Guarantor or Significant Subsidiary and/or its assets,
      equipment, property, leaseholds, or other facilities for damages or cleanup
      costs relating to a hazardous discharge or an environmental complaint;
provided,
      however,
      that
      such claim shall not constitute a default if, within fifteen (15) days of the
      occurrence giving rise to the claim, (a) the Borrower can prove to the
      reasonable satisfaction of the Required Lenders that the Borrower has commenced
      and is diligently pursuing either: (i) a cure or correction of the event which
      constitutes the basis for the claim, and continues diligently to pursue such
      cure or correction, it being hereby acknowledged by the Lenders that (with
      respect to the matters disclosed in Schedule
      4.14)
      the
      Borrower’s compliance with the covenants contained in Sections 5.06 and 5.10
      shall satisfy the requirements of this clause (i), or (ii) proceedings for
      an
      injunction, a restraining order or other appropriate emergent relief preventing
      such agency or agencies from asserting such claim, which relief is granted
      within thirty (30) days of the occurrence giving rise to the claim and the
      injunction, order, or emergent relief is not thereafter resolved or reversed
      on
      appeal or (iii) the defense against the claim through action in a court or
      agency exercising jurisdiction over the claim; and (b) in any of the foregoing
      events (except for the matters disclosed in Schedule
      4.14,
      as to
      which no security is required), the Borrower has posted a bond, letter of
      credit, or other security satisfactory in form, substance, and amount to the
      Required Lenders and the agency or entity asserting the claim to secure the
      correction of the event which constitutes the basis for the claim in accordance
      with applicable laws;

     

    then
      the
      following provisions shall apply:

     

    (i)  if
      any
      Event of Default described in Section 8.01(5) occurs with respect to the
      Borrower, the obligations of the Lenders to make Loans hereunder and the
      obligation and power of the Issuers to issue Facility Letters of Credit shall
      automatically terminate and the Obligations shall immediately become due and
      payable without any election or action on the part of the Agent, any Issuer
      or
      any Lender and the Borrower will be and become thereby unconditionally
      obligated, without any further notice, act or demand, to pay to the Agent an
      amount in immediately available funds, which funds shall be held in the Facility
      Letter of Credit Collateral Account, equal to the difference of (x) the amount
      of Facility Letter of Credit Obligations at such time, less (y) the amount
      on
      deposit in the Facility Letter of Credit Collateral Account at such time which
      is free and clear of all rights and claims of third parties and has not been
      applied against the Obligations (such difference, the “Collateral Shortfall
      Amount”). If any other Event of Default occurs, the Required Lenders (or the
      Agent with the consent of the Required Lenders) may (a) terminate or suspend
      the
      obligations of the Lenders to make 

     

    
      
        
        

      

      
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    Loans
      hereunder and the obligation and power of the Issuers to issue Facility Letters
      of Credit, or declare the Obligations to be due and payable, or both, whereupon
      the Obligations shall become immediately due and payable, without presentment,
      demand, protest or notice of any kind, all of which the Borrower hereby
      expressly waives, and (b) upon notice to the Borrower and in addition to the
      continuing right to demand payment of all amounts payable under this Agreement,
      make demand on the Borrower to pay, and the Borrower will, forthwith upon such
      demand and without any further notice or act, pay to the Agent the Collateral
      Shortfall Amount, which funds shall be deposited in the Facility Letter of
      Credit Collateral Account.

     

    (ii)  If
      at any
      time while any Event of Default is continuing, the Agent determines that the
      Collateral Shortfall Amount at such time is greater than zero, the Agent may
      make demand on the Borrower to pay, and the Borrower will, forthwith upon such
      demand and without any further notice or act, pay to the Agent the Collateral
      Shortfall Amount, which funds shall be deposited in the Facility Letter of
      Credit Collateral Account.

     

    (iii)  The
      Agent
      may, at any time or from time to time after funds are deposited in the Facility
      Letter of Credit Collateral Account, apply such funds to the payment of the
      Obligations and any other amounts as shall from time to time have become due
      and
      payable by the Borrower to the Lenders or the Issuer under the Loan
      Documents.

     

    (iv)  At
      any
      time while any Event of Default is continuing, neither the Borrower nor any
      Person claiming on behalf of or through the Borrower shall have any right to
      withdraw any of the funds held in the Facility Letter of Credit Collateral
      Account. After all of the Obligations have been indefeasibly paid in full and
      the Aggregate Commitment has been terminated, any funds remaining in the
      Facility Letter of Credit Collateral Account shall be returned by the Agent
      to
      the Borrower or paid to whomever may be legally entitled thereto at such
      time.

     

    (v)  If,
      within 30 days after acceleration of the maturity of the Obligations or
      termination of the obligations of the Lenders to make Loans and the obligation
      and power of the Issuer to issue Facility Letters of Credit hereunder as a
      result of any Event of Default (other than any Event of Default as described
      in
      Section 8.01(5) with respect to the Borrower) and before any judgment or decree
      for the payment of the Obligations due shall have been obtained or entered,
      the
      Required Lenders (in their sole discretion) shall so direct, the Agent shall,
      by
      notice to the Borrower, rescind and annul such acceleration and/or
      termination.

     

    Section
      8.02   Set
      Off.
      Upon
      the occurrence and during the continuance of any Event of Default, each Lender
      is hereby authorized at any time and from time to time, without notice to the
      Borrower (any such notice being expressly waived by the Borrower), to set off
      and apply any and all deposits (general or special, time or demand, provisional
      or final) at any time held and other indebtedness at any time owing by such
      Lender to or for the credit or the account of the Borrower against any and
      all
      of the obligations of the Borrower now or hereafter existing under this
      Agreement or any Note or Notes held by such Lender or any other Loan Document,
      irrespective of whether or not the Agent or such Lender shall have made any
      demand under this Agreement or any Note or Notes held by such Lender or such
      other Loan Document and although such obligations may be unmatured. Each Lender
      agrees promptly to notify the Borrower (with a copy to the Agent) after any
      such
      set-off and application, provided that the failure to give such notice shall
      not
      affect the validity of such set-off and application. The rights of each Lender
      under this Section 8.02 are in addition to other rights and remedies (including,
      without limitation, other rights of set-off) which each Lender may
      have.

     

    
      
        
        

      

      
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    ARTICLE
      IX

    AGENCY
      PROVISIONS

     

    Section
      9.01   Authorization
      and Action.
      Each
      Lender hereby irrevocably appoints and authorizes the Agent to take such action
      as agent on its behalf and to exercise such powers under this Agreement as
      are
      delegated to the Agent by the terms hereof, together with such powers as are
      reasonably incidental thereto. The duties of the Agent shall be mechanical
      and
      administrative in nature and the Agent shall not by reason of this Agreement
      be
      a trustee or fiduciary for any Lender. The Agent shall have no duties or
      responsibilities except those expressly set forth herein. As to any matters
      not
      expressly provided for by this Agreement (including, without limitation,
      enforcement or collection of the Notes), the Agent shall not be required to
      act
      or to refrain from acting except upon the instructions of the Required Lenders
      or, to the extent required under Section 10.01, all Lenders (and shall be fully
      protected in so acting or so refraining from acting), and such instructions
      shall be binding upon all Lenders and all holders of Notes; provided,
      however,
      that
      the Agent shall not be required to take any action which exposes the Agent
      to
      personal liability or which is contrary to this Agreement or applicable law.
      The
      Agent shall administer the Loan in the same manner that it would administer
      a
      comparable loan held 100% for its own account.

     

    Section
      9.02   Liability
      of Agent.
      Neither
      the Agent nor any of its directors, officers, agents, or employees shall be
      liable for any action taken or omitted to be taken by it or them in good faith
      under or in connection with this Agreement in the absence of its or their own
      gross negligence or willful misconduct. Without limiting the generality of
      the
      foregoing, the Agent (1) may treat the payee of any Note as the holder thereof
      until the Agent receives written notice of the assignment or transfer thereof
      signed by such payee and in form satisfactory to the Agent; (2) may consult
      with
      legal counsel (including counsel for the Borrower), independent public
      accountants and other experts selected by it and shall not be liable for any
      action taken or omitted to be taken in good faith by it in accordance with
      the
      advice of such counsel, accountants, or experts; (3) makes no warranty or
      representation to any Lender and shall not be responsible to any Lender for
      any
      statements, warranties, or representations made in or in connection with this
      Agreement; (4) shall not have any duty to ascertain or to inquire as to the
      performance or observance of any terms, covenants, or conditions of this
      Agreement on the part of the Borrower (other than the payment of principal,
      interest and fees due hereunder), or to inspect the property (including the
      books and records) of the Borrower; (5) shall not be responsible to any Lender
      for the due execution, legality, validity, enforceability, genuineness,
      perfection, sufficiency or value of this Agreement or any other instrument
      or
      document furnished pursuant hereto or the value, sufficiency, creation,
      perfection or priority of any Lien in any collateral security; and (6) shall
      incur no liability under or in respect of this Agreement by acting upon any
      notice, consent, certificate or other instrument or writing (which may be sent
      by telegram, telefax, or facsimile transmission) reasonably believed by it
      to be
      genuine and signed or sent by the proper party or parties.

     

    
      
        
        

      

      
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    Section
      9.03   Rights
      of Agent as a Lender.
      With
      respect to its Commitment, the Loans made by it and any Note issued to it,
      the
      Agent shall have the same rights and powers under this Agreement as any other
      Lender and may exercise the same as though it were not the Agent; and the term
      “Lender” or “Lenders” shall, unless otherwise expressly indicated, include the
      Agent in its individual capacity. The Agent, each Lender and each of their
      respective Affiliates may accept deposits from, lend money to, act as trustee
      under indentures of, and generally engage in any kind of business with, the
      Borrower, any of its Subsidiaries and any Person who may do business with or
      own
      securities of the Borrower or any Subsidiary, all as if the Agent were not
      the
      Agent and without any duty to account therefor to the other
      Lenders.

     

    Section
      9.04   Independent
      Credit Decisions.
      Each
      Lender acknowledges that it has, independently and without reliance upon the
      Agent or any other Lender and based on such documents and information as it
      has
      deemed appropriate, made its own credit analysis and decision to enter into
      this
      Agreement. Each Lender also acknowledges that it will, independently and without
      reliance upon the Agent or any other Lender and based on such documents and
      information as it shall deem appropriate at the time, continue to make its
      own
      credit decisions in taking or not taking action under this Agreement. The Agent
      shall promptly provide the Lenders with copies of all notices of default and
      other formal notices sent or received in accordance with Section 10.02, any
      written notice relating to changes in the Borrower’s debt ratings that affect
      the Senior Debt Rating received from the Borrower or a ratings agency, any
      documents received by the Agent pursuant to Section 5.08 (except to the extent
      that the Borrower has furnished the same directly to the Lenders) and any other
      documents or notices received by the Agent with respect to this Agreement and
      requested in writing by any Lender. Except for notices, reports and other
      documents and information expressly required to be furnished to the Lenders
      by
      the Agent hereunder, the Agent shall have no duty or responsibility to provide
      any Lender with any credit or other information concerning the affairs,
      financial condition or business of the Borrower or any of its Subsidiaries
      (or
      any of their Affiliates) which may come into possession of the Agent or any
      of
      its Affiliates.

     

    Section
      9.05   Indemnification.
      The
      Lenders severally agree to indemnify the Agent in its capacity as Agent and
      not
      as a Lender (to the extent not reimbursed by the Borrower and without limiting
      the obligation of the Borrower to do so), in the proportion of their Pro Rata
      Shares, from and against any and all liabilities, obligations, losses, damages,
      penalties, actions, judgments, suits, costs, expenses or disbursements of any
      kind or nature whatsoever which may be imposed on, incurred by, or asserted
      against the Agent in any way relating to or arising out of this Agreement or
      any
      action taken or omitted by the Agent under this Agreement, provided that no
      Lender shall be liable for any portion of any of the foregoing (i) resulting
      from the Agent’s gross negligence or willful misconduct, (ii) on account of a
      strictly internal or regulatory matter relating to the Agent (such as relating
      to legal lending limit violation by the Agent), or (iii) in connection with
      a
      breach of an agreement made by the Agent to a Lender under this Agreement.
      Without limitation of the foregoing, each Lender severally agrees to reimburse
      the Agent (to the extent not reimbursed by the Borrower and without limiting
      the
      obligation of the Borrower to do so) promptly upon demand for its Pro Rata
      Share
      of any reasonable out-of-pocket expenses (including counsel fees) incurred
      by
      the Agent in connection with the preparation, administration, or enforcement
      of,
      or legal advice in respect of rights or responsibilities under, this Agreement;
      provided, however, that no Lender shall be required to reimburse the Agent
      for
      any such expenses incurred (i) resulting from the Agent’s gross negligence or
      willful misconduct, (ii) on account of a strictly internal or regulatory matter
      relating to the Agent (such as relating to legal lending limit violation by
      the
      Agent), or (iii) in connection with a breach of an agreement made by the Agent
      to a Lender under this Agreement.

     

    
      
        
        

      

      
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    Section
      9.06   Successor
      Agent.
      (a) The
      Agent may resign at any time by giving at least sixty (60) days’ prior written
      notice thereof to the Lenders and the Borrower and may be removed at any time
      with or without cause by the Required Lenders. Upon any such resignation or
      removal, the Required Lenders shall have the right to appoint a successor Agent,
      subject to Section 9.06(b). If no successor Agent shall have been so appointed
      by the Required Lenders, and shall have accepted such appointment, within thirty
      (30) days after the retiring Agent’s giving of notice of resignation or the
      Required Lenders’ removal of the retiring Agent, then the retiring Agent may, on
      behalf of the Lenders, appoint a successor Agent, which shall be a commercial
      bank or federal savings bank organized under the laws of the United States
      of
      America or of any State thereof, subject to Section 9.06(b). Upon the acceptance
      of any appointment as Agent hereunder by a successor Agent, such successor
      Agent
      shall thereupon succeed to and become vested with all the rights, powers,
      privileges and duties of the retiring Agent, and the retiring Agent shall be
      discharged from its duties and obligations under this Agreement. After any
      retiring Agent’s resignation or removal hereunder as Agent, the provisions of
      this Article IX shall inure to its benefit as to any actions taken or
      omitted to be taken by it while it was Agent under this Agreement.

     

    (b) The
      appointment of any successor Agent that is not a Lender shall, as long as no
      Event of Default shall have occurred and be continuing, be subject to the prior
      written approval of the Borrower, which approval shall not be unreasonably
      withheld or delayed.

     

    Section
      9.07   Sharing
      of Payments, Etc.
      If any
      Lender shall obtain any payments (whether voluntary, involuntary, through the
      exercise of any right of set-off, or otherwise) on account of any Note or Notes
      held by it in excess of its Pro Rata Share of payments on account of the Notes
      obtained by all Lenders, such Lender shall purchase from the other Lenders
      such
      participations in the Notes held by them as shall be necessary to cause such
      purchasing Lender to share the excess payment ratably with each of the other
      Lenders, provided,
      however,
      that if
      all or any portion of such excess payment is thereafter recovered from such
      purchasing Lender, such purchase from each Lender shall be rescinded and each
      applicable Lender shall repay to the purchasing Lender the purchase price to
      the
      extent of such recovery together with an amount equal to such Lender’s ratable
      share (according to the proportion of (1) the amount of such Lender’s required
      repayment to (2) the total amount so recovered from the purchasing Lender)
      of
      any interest or other amount paid or payable by the purchasing Lender in respect
      of the total amount so recovered. The Borrower agrees that any Lender so
      purchasing a participation from another Lender pursuant to this Section 9.07
      may, to the fullest extent permitted by law, exercise all its rights of payment
      (including the right of set-off) with respect to such participation as fully
      as
      if such Lender were the direct creditor of the Borrower in the amount of such
      participation.

     

    Section
      9.08   Withholding
      Tax Matters.
      Each
      Lender which is a Non-United States Person agrees to execute and deliver to
      the
      Agent for delivery to the Borrower, before the first scheduled payment date
      in
      each year (and, in the case of a Lender that becomes a Lender hereunder by
      assignment, before the first scheduled payment date following such assignment),
      two duly completed copies of United States Internal Revenue Service Forms W-8BEN
      or W-8ECI, or any successor forms, as appropriate, properly completed and
      certifying that such Lender is entitled to receive payments under this Agreement
      without withholding or deduction of United States federal taxes. Each Lender
      which is a Non-United States Person represents and warrants to the Borrower
      and
      to the Agent that, at the date of this Agreement, (i) its Lending Offices are
      entitled to receive payments of principal, interest, 

     

    
      
        
        

      

      
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    and
      fees
      hereunder without deduction or withholding for or on account of any taxes
      imposed by the United States or any political subdivision thereof and (ii)
      it is
      permitted to take the actions described in the preceding sentence under the
      laws
      and any applicable double taxation treaties of the jurisdictions specified
      in
      the preceding sentence. Each Lender which is a Non-United States Person further
      agrees that, to the extent any form claiming complete or partial exemption
      from
      withholding and deduction of United States federal taxes delivered under this
      Section 9.08 is found to be incomplete or incorrect in any material respect,
      such Lender shall execute and deliver to the Agent a complete and correct
      replacement form.

     

    Section
      9.09   Syndication
      Agents, Documentation Agents, Managing Agents or
      Co-Agents.
      None of
      the Lenders identified in this Agreement as a “Syndication Agent,”
“Documentation Agent,” “Managing Agent” or “Co-Agent” shall have any right,
      power, obligation, liability, responsibility or duty under this Agreement other
      than those applicable to all Lenders as such. Without limiting the foregoing,
      none of such Lenders shall have or be deemed to have a fiduciary relationship
      with any Lender. Each Lender hereby makes the same acknowledgements with respect
      to such Lenders as it makes with respect to the Agent in Section
      9.04.

     

    ARTICLE
      X

    MISCELLANEOUS

     

    Section
      10.01   Amendments,
      Etc.
      No
      amendment, modification, termination, or waiver of any provision of any Loan
      Document to which the Borrower is a party, nor consent to any departure by
      the
      Borrower from any Loan Document to which it is a party, shall in any event
      be
      effective unless the same shall be in writing and signed by the Required Lenders
      and the Borrower, and then such waiver or consent shall be effective only in
      the
      specific instance and for the specific purpose for which given; provided,
      however,
      that no
      amendment, waiver or consent shall (a) unless in writing and signed by the
      Borrower and all of the Lenders do, or have the effect of doing, any of the
      following: (1) increase the Commitments of the Lenders (except for increases
      in
      the Aggregate Commitment in accordance with Section 2.02.2; provided
      that no
      such increase shall result in the Aggregate Commitment exceeding $1,000,000,000)
      or subject the Lenders to any additional obligations; (2) reduce the principal
      of, or interest on, the Notes or any fees (other than the Agent’s fees)
      hereunder; (3) postpone any date fixed for any payment of principal of, or
      interest on, the Notes or any fees (other than the Agent’s fees) hereunder; (4)
      change the percentage of the Commitments or of the aggregate unpaid principal
      amount of the Notes or the number of Lenders which shall be required for the
      Lenders or any of them to take action hereunder (including, without limitation,
      any change in the percentage of Lenders required to extend the Termination
      Date
      under the provisions of Section 2.19; (5) release any Significant Guarantor
      or
      (except as otherwise provided in Section 8.01) release any sums held in the
      Facility Letter of Credit Collateral Account; or (6) amend, modify or waive
      any
      provision of the Guaranty, this Section 10.01 or clause (i) of Section 11.01;
      (b) unless in writing and signed by the Agent in addition to the Lenders
      required herein to take such action, affect the rights or duties of the Agent
      under any of the Loan Documents; (c) unless in writing and signed by the Swing
      Line Lender and the Required Lenders, affect any provisions of this Agreement
      that relate to the Swing Line Loans or otherwise affect the rights or duties
      of
      the Swing Line Lender; or (d) unless in writing and signed by the Issuers and
      the Required Lenders, affect any of the provisions of this Agreement that relate
      to the Facility Letters of Credit or otherwise affect the rights or duties
      of
      any Issuer.

     

    
      
        
        

      

      
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    Section
      10.02   Notices,
      Etc.
      All
      notices and other communications provided for under this Agreement and under
      the
      other Loan Documents to which the Borrower is a party shall be in writing
      (including facsimile transmissions) and mailed or transmitted or hand delivered,
      if to the Borrower or the Agent at its respective address set forth on the
      signature pages hereof; or, if to a Lender, at its address set forth in its
      Administrative Questionnaire, or, as to each party, at such other address as
      shall be designated by such party in a written notice to all other parties
      complying as to delivery with the terms of this Section 10.02. Except as is
      otherwise provided in this Agreement, all such notices and communications shall
      be effective when deposited in the mail, or transmitted, answerback received,
      or
      hand delivered, respectively, addressed as aforesaid, except that notices to
      the
      Agent pursuant to the provisions of Article II shall not be effective until
      received by the Agent or, in the case of Section 2.21, the Swing Line
      Lender.

     

    Section
      10.03   No
      Waiver.
      No
      failure or delay on the part of any Lender or the Agent or the Issuer in
      exercising any right, power, or remedy hereunder shall operate as a waiver
      thereof; nor shall any single or partial exercise of any such right, power,
      or
      remedy preclude any other or further exercise thereof or the exercise of any
      other right, power, or remedy hereunder. The making of a Loan or issuance,
      amendment or extension of a Facility Letter of Credit notwithstanding the
      existence of a Default or Event of Default shall not constitute any waiver
      or
      acquiescence of such Default or Event of Default, and the making of any Loan
      or
      issuance, amendment or extension of a Facility Letter of Credit notwithstanding
      any failure or inability to satisfy the conditions precedent to such Loan or
      issuance, amendment or extension of a Facility Letter of Credit shall not
      constitute any waiver or acquiescence with respect to such conditions precedent
      with respect to any subsequent Loans or subsequent issuance, amendment or
      extension of a Facility Letter of Credit. The rights and remedies provided
      herein are cumulative, and are not exclusive of any other rights, powers,
      privileges, or remedies, now or hereafter existing, at law, in equity or
      otherwise.

     

    Section
      10.04   Costs,
      Expenses, and Taxes.
      (a) The
      Borrower agrees to reimburse the Agent for any reasonable costs, internal
      charges and out-of-pocket expenses (including reasonable fees and time charges
      of attorneys for the Agent, which attorneys may be employees of the Agent)
      paid
      or incurred by the Agent in connection with the preparation, negotiation,
      execution, delivery, review, amendment, modification and administration of
      the
      Loan Documents. The Borrower also agrees to reimburse the Agent, the Lenders
      and
      the Issuers for any reasonable costs, internal charges and out-of-pocket
      expenses (including attorneys’ fees and time charges of attorneys for the Agent,
      the Lenders and the Issuers which attorneys may be employees of the Agent,
      the
      Lenders and the Issuers) paid or incurred by the Agent, the Arrangers, any
      Lender or Issuer in connection with the collection of the Obligations and
      enforcement of the Loan Documents, including during any workout or restructuring
      in respect of the Loan Documents.

     

    
      
        
        

      

      
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    (b) The
      Borrower shall pay any and all stamp and other taxes and fees payable or
      determined to be payable in connection with the execution, delivery, filing,
      and
      recording of any of the Loan Documents and the other documents to be delivered
      under any such Loan Documents, and agrees to hold the Agent and each of the
      Lenders harmless from and against any and all liabilities with respect to or
      resulting from any delay in paying or failing to pay such taxes and
      fees.

     

    (c) All
      payments by the Borrower to or for the account of any Lender, Issuer or the
      Agent hereunder or under any Note or Reimbursement Agreement shall be made
      free
      and clear of and without deduction for any and all Taxes. If the Borrower shall
      be required by law to deduct any Taxes from or in respect of any such payable
      hereunder to any Lender, Issuer or the Agent, upon notice from the Agent to
      the
      Borrower (i) the sum payable shall be increased as necessary so that after
      making all required deductions (including deductions applicable to additional
      sums payable under this paragraph) such Lender, Issuer or the Agent (as the
      case
      may be) receives an amount equal to the sum it would have received had no such
      deductions been made, (ii) the Borrower shall make such deductions, (iii) the
      Borrower shall pay the full amount deducted to the relevant authority in
      accordance with applicable law and (iv) the Borrower shall furnish to the Agent
      the original copy of a receipt evidencing payment thereof within 30 days after
      such payment is made.

     

    (d) This
      Section 10.04 shall survive termination of this Agreement.

     

    Section
      10.05   Integration.
      This
      Agreement (including the Borrower’s obligation to pay the fees as provided in
      Section 2.09(c) and the Fee Letter referred to therein) and the Loan Documents
      contain the entire agreement between the parties relating to the subject matter
      hereof and supersede all oral statements and prior writings with respect
      thereto.

     

    Section
      10.06   Indemnity.
      The
      Borrower hereby agrees to defend, indemnify, and hold each Lender and each
      director, officer, employee agent and advisor of each Lender (each an
“Indemnified Party”) harmless from and against all claims, damages, judgments,
      penalties, costs, and expenses (including reasonable attorney fees and court
      costs now or hereafter arising from the aforesaid enforcement of this clause)
      arising directly or indirectly from the activities of the Borrower and its
      Subsidiaries, its predecessors in interest, or third parties with whom it has
      a
      contractual relationship, or arising directly or indirectly from the violation
      of any environmental protection, health, or safety law, whether such claims
      are
      asserted by any governmental agency or any other person, other than claims,
      damages, judgments, penalties, costs and expenses arising as a result of any
      Indemnified Party’s willful misconduct or gross negligence as determined by a
      court of competent jurisdiction by a final and nonappealable judgment. This
      indemnity shall survive termination of this Agreement.

     

    Section
      10.07   CHOICE
      OF LAW.
      THE
      LOAN DOCUMENTS SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS
      OF
      THE STATE OF NORTH CAROLINA BUT GIVING EFFECT TO FEDERAL LAWS APPLICABLE TO
      NATIONAL BANKS.

     

    Section
      10.08   Severability
      of Provisions.
      Any
      provision of any Loan Document which is prohibited or unenforceable in any
      jurisdiction shall, as to such jurisdiction, be ineffective to the extent of
      such prohibition or unenforceability without invalidating the remaining
      provisions of such Loan Document or affecting the validity or enforceability
      of
      such provision in any other jurisdiction.

     

    
      
        
        

      

      
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    Section
      10.09   Counterparts.
      This
      Agreement may be executed in any number of counterparts and by the different
      parties to this Agreement in separate counterparts, each of which when so
      executed shall be deemed to be an original and all of which taken together
      shall
      constitute one and the same Agreement.

     

    Section
      10.10   Headings.
      Article
      and Section headings in the Loan Documents are included in such Loan Documents
      for the convenience of reference only and shall not constitute a part of the
      applicable Loan Documents for any other purpose.

     

    Section
      10.11   CONSENT
      TO JURISDICTION.
      THE
      BORROWER HEREBY IRREVOCABLY SUBMITS TO THE NON-EXCLUSIVE JURISDICTION OF ANY
      UNITED STATES FEDERAL OR NORTH CAROLINA STATE COURT SITTING IN CHARLOTTE, NORTH
      CAROLINA IN ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO ANY LOAN
      DOCUMENTS AND THE BORROWER HEREBY IRREVOCABLY AGREES THAT ALL CLAIMS IN RESPECT
      OF SUCH ACTION OR PROCEEDING MAY BE HEARD AND DETERMINED IN ANY SUCH COURT
      AND
      IRREVOCABLY WAIVES ANY OBJECTION IT MAY NOW OR HEREAFTER HAVE AS TO THE VENUE
      OF
      ANY SUCH SUIT, ACTION OR PROCEEDING BROUGHT IN SUCH A COURT OR THAT SUCH COURT
      IS AN INCONVENIENT FORUM. NOTHING HEREIN SHALL LIMIT THE RIGHT OF THE AGENT
      OR
      ANY LENDER TO BRING PROCEEDINGS AGAINST THE BORROWER IN THE COURTS OF ANY OTHER
      JURISDICTION. ANY JUDICIAL PROCEEDING BY THE BORROWER AGAINST THE AGENT OR
      ANY
      LENDER OR ANY AFFILIATE OF THE AGENT OR ANY LENDER INVOLVING, DIRECTLY OR
      INDIRECTLY, ANY MATTER IN ANY WAY ARISING OUT OF, RELATED TO, OR CONNECTED
      WITH
      ANY LOAN DOCUMENT SHALL BE BROUGHT ONLY IN A COURT IN CHARLOTTE, NORTH
      CAROLINA.

     

    Section
      10.12   WAIVER
      OF JURY TRIAL.
      THE
      BORROWER, THE AGENT AND EACH LENDER HEREBY WAIVE TRIAL BY JURY IN ANY JUDICIAL
      PROCEEDING INVOLVING, DIRECTLY OR INDIRECTLY, ANY MATTER (WHETHER SOUNDING
      IN
      TORT, CONTRACT OR OTHERWISE) IN ANY WAY ARISING OUT OF, RELATED TO, OR CONNECTED
      WITH ANY LOAN DOCUMENT OR THE RELATIONSHIP ESTABLISHED THEREUNDER.

     

    Section
      10.13   Governmental
      Regulation.
      Anything contained in this Agreement to the contrary notwithstanding, no Lender
      shall be obligated to extend credit to the Borrower in violation of any
      limitation or prohibition provided by any applicable statute or
      regulation.

     

    Section
      10.14   No
      Fiduciary Duty.
      The
      relationship between the Borrower and the Lenders and the Agent shall be solely
      that of borrower and lender. Neither the Agent nor any Lender shall have any
      fiduciary responsibilities to the Borrower. Neither the Agent nor any Lender
      undertakes any responsibility to the Borrower to review or inform the Borrower
      of any matter in connection with any phase of the Borrower’s business or
      operations.

     

    
      
        
        

      

      
        69

        
          

        

      

      
        
        

      

    

     

    Section
      10.15   Confidentiality.
      Each
      Lender agrees to hold any confidential information which it may receive from
      the
      Borrower pursuant to this Agreement in confidence, except for disclosure (i)
      to
      other Lenders and their respective Affiliates, (ii) to legal counsel,
      accountants, and other professional advisors to that Lender, (iii) to regulatory
      officials, (iv) to any Person as requested pursuant to or as required by law,
      regulation, or legal process, (v) to any Person in connection with any legal
      proceeding to which that Lender is a party, and (vi) subject to an agreement
      containing provisions substantially the same as this Section 10.15, to (A)
      any
      actual or prospective assignee or Participant under this Agreement, (B) any
      actual or prospective counterparty to any swap or derivative transaction
      relating to the Borrower and its obligations and (C) legal counsel, accountants
      and other professional advisors to a Person described in clause (A) or (B)
      above.

     

    Section
      10.16   USA
      Patriot Act Notification.
      Each
      Lender that is subject to the requirements of the USA Patriot Act (Title III
      of
      Pub. L. 107-56 (signed into law October 26, 2001)) (the “Act”) hereby notifies
      the Borrower that pursuant to the requirements of the Act, it is required to
      obtain, verify and record information that identifies the Borrower, which
      information includes the name and address of the Borrower and other information
      that will allow such Lender to identify the Borrower in accordance with the
      Act.

     

    Section
      10.17   Register.
      The
      Agent, acting for this purpose as an agent of the Borrower, shall maintain
      at
      one of its offices a copy of each Assignment and Assumption delivered to it
      and
      a register for the recordation of the names and addresses of the Lenders, and
      the Commitment of, and principal amount of the Loans and Facility Letter of
      Credit Obligations owing to, each Lender pursuant to the terms hereof from
      time
      to time (the "Register"). The entries in the Register shall be conclusive,
      absent manifest error, and the Borrower, the Agent, the Issuers and the Lenders
      may treat each Person whose name is recorded in the Register pursuant to the
      terms hereof as a Lender hereunder for all purposes of this Agreement,
      notwithstanding notice to the contrary. The Register shall be available for
      inspection by the Borrower, the Issuers and any Lender, at any reasonable time
      and from time to time upon reasonable prior notice.

     

    ARTICLE
      XI

    BENEFIT
      OF AGREEMENT; ASSIGNMENTS; PARTICIPATIONS

     

    Section
      11.01   Successors
      and Assigns.
      The
      provisions of this Agreement and the other Loan Documents shall be binding
      upon
      and inure to the benefit of the parties hereto and their respective successors
      and assigns permitted hereby (including any Affiliate of an Issuer that issues
      any Facility Letter of Credit), except that (i) the Borrower may not assign
      or
      otherwise transfer any of its rights or obligations hereunder or under the
      other
      Loan Documents without the prior written consent of each Lender (and any
      attempted assignment or transfer by the Borrower without such consent shall
      be
      null and void) and (ii) no Lender may assign or otherwise transfer its rights
      or
      obligations hereunder or under the other Loan Documents except in accordance
      with this Article XI. Nothing in this Agreement, expressed or implied, shall
      be
      construed to confer upon any Person (other than the parties hereto, their
      respective successors and assigns permitted hereby (including any Affiliate
      of
      an Issuer that issues any Facility Letter of Credit) and Participants (to the
      extent provided in Section 11.03)) any legal or equitable right, remedy or
      claim
      under or by reason.

     

    
      
        
        

      

      
        70

        
          

        

      

      
        
        

      

    

     

    Section
      11.02   Assignments.

     

    (a)  Subject
      to the conditions set forth in Section 11.02(b), any Lender may assign to one
      or
      more assignees all or a portion of its rights and obligations under this
Agreement and the other Loan Documents (including all or a portion of its
      Commitment and the Loans at the time owing to it); provided that the written
      consents (which consents shall not be unreasonably withheld or delayed) of
      the
      Agent and (unless an Event of Default has occurred and is continuing) the
      Borrower shall be required prior to an assignment becoming effective with
      respect to an assignee which, prior to such assignment, is not a Lender, an
      Affiliate of a Lender or an Approved Fund.

     

    (b)  Assignments
      shall be subject to the following additional conditions:

     

        (i)  each
      partial assignment shall be made as an assignment of a proportionate part of
      all
      the assigning Lender's rights and obligations under this Agreement,

     

        (ii)  the
      parties to each assignment shall execute and deliver to the Agent an Assignment
      and Assumption (“Assignment and Assumption”) in substantially the form of
Exhibit
      F
      hereto,
      together with a processing and recordation fee of $3,500; and

     

    (iii)  the
      assignee, if it shall not be a Lender, shall deliver to the Agent an
      Administrative Questionnaire.

     

    (c)  Upon
      its
      receipt of a duly completed Assignment and Assumption executed by an assigning
      Lender and an assignee, the assignee's completed Administrative Questionnaire
      (unless the assignee shall already be a Lender hereunder), the processing and
      recordation fee referred to in Section 11.02(b)(ii) and any written consent
      to
      such assignment required by Section 11.02(a), the Agent shall accept such
      Assignment and Assumption and record the information contained therein in the
      Register; provided
      that if
      either the assigning Lender or the assignee shall have failed to make any
      payment required to be made by it pursuant to Section 2.04(a), 2.21(d),
      2.22.6(b) or 9.05, the Agent shall have no obligation to accept such Assignment
      and Assumption and record the information therein in the Register unless and
      until such payment shall have been made in full, together with all accrued
      interest thereon. No assignment shall be effective for purposes of this
      Agreement unless it has been recorded in the Register as provided in this
      paragraph.

     

    Section
      11.03   Participations.
      Any
      Lender may, without the consent of the Borrower, the Agent, the Issuer or the
      Swing Line Lender, sell participations to one or more banks or other entities
      (a
      "Participant") in all or a portion of such Lender's rights and obligations
      under
      this Agreement and the other Loan Documents (including all or a portion of
      its
      Commitment and the Loans owing to it); provided
      that
      (i) such Lender's obligations under this Agreement and the other Loan
      Documents shall remain unchanged, (ii) such Lender shall remain solely
      responsible to the other parties hereto for the performance of such obligations,
      (iii) such Lender shall remain the holder of any such Note for all purposes
      under the Loan Documents, (iv) all amounts payable by the Borrower under this
      Agreement shall be determined as if such Lender had not sold participating
      interests and (v) the Borrower, the Agent, 

     

    
      
        
        

      

      
        71

        
          

        

      

      
        
        

      

    

     

    the
      Issuer and the other Lenders shall continue to deal solely and directly with
      such Lender in connection with such Lender's rights and obligations under this
      Agreement. Any agreement or instrument pursuant to which a Lender sells such
      a
      participation shall provide that such Lender shall retain the sole right to
      enforce this Agreement and to approve any amendment, modification or waiver
      of
      any provision of this Agreement; provided
      that
      such agreement or instrument may provide that such Lender will not, without
      the
      consent of the Participant, agree to any amendment, modification or waiver
      that
      (i) forgives principal, interest or fees (other than Agent’s fees) or reduces
      the interest rate (other than Agent’s fees), (ii) postpones any date fixed for
      any regularly scheduled payment of principal of, or interest or fees (other
      than
      Agent’s fees) or (iii) releases any Significant Guarantor.

     

    Section
      11.04   Pledge
      to Federal Reserve Bank.
      Any
      Lender may at any time pledge or assign a security interest in all or any
      portion of its rights under this Agreement to secure obligations of such Lender
      to a Federal Reserve Bank, and this Article shall not apply to any such pledge
      or assignment of a security interest; provided
      that no
      such pledge or assignment of a security interest shall release a Lender from
      any
      of its obligations hereunder or substitute any such pledgee or assignee for
      such
      Lender as a party hereto.

     

    
      
        
        

      

      
        72

        
          

        

      

      
        
        

      

       

    

    IN
      WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed
      by
      their respective officers thereunto duly authorized, as of the date first
      written.

     

    

     

    BEAZER
      HOMES USA, INC.

     

    By:
      /s/
      Allan P. Merrill (SEAL)

    Name:
      Allan P. Merrill

    Title:
      Executive Vice President and CFO

    

    Address
      for Notices

     

    1000
      Abernathy Road

    Suite
      1200

    Atlanta,
      Georgia 30328

    Attention:
      President

    Tel:
      (770) 829-3700

    Fax: (770)
      481-0431

     

    

    
      
        
          [Signature
            Page to Credit Agreement]

          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

    

    

    WACHOVIA
      BANK, NATIONAL ASSOCIATION, as Agent and as a Lender

     

    By:
      /s/
      R.
      Scott Holtzapple

    Name:
      R.
      Scott Holtzapple

    Title:
      Senior Vice President

     

    Address
      for Notices of Borrowings:

     

    Wachovia
      Bank, National Association

    Attn:
       Deana Adams 

    201
      S.
      College Street 

    CP8
      mailcode NC5708 

    Charlotte,
      NC  28288

    Telecopy:
      704-383-7989

    

    

    Address
      for all other Notices

     

    Wachovia
      Bank, National Association

    401
      South
      Tryon Street NC 1193

    Charlotte,
      North Carolina 28288

    Attn:
      Scott Holtzapple

    Telephone:
      (704) 383-0474

    Telecopy:
      (704) 383-7146

     

    

    
      
        
          [Signature
            Page to Credit Agreement]

          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

    

    

    CITIBANK,
      N.A., as a Lender

     

    By:
      /s/
      Mark Floyd

    Name:
      Mark Floyd

    Title:
      Vice President

     

    

    
      
        
          [Signature
            Page to Credit Agreement]

          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

    

    

    BNP
      PARIBAS, as a Lender

     

    By:
      /s/
      Berangere Allen

    Name:
      Berangere Allen

    Title:
      Vice-President

     

    By:
      /s/
      Duane Helkowski

    Name:
      Duane Helkowski

    Title:
      Managing Director

     

    

    
      
        
          [Signature
            Page to Credit Agreement]

          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

    

    

    THE
      ROYAL
      BANK OF SCOTLAND, as a Lender

     

    By:
      /s/
      William McGinty

    Name:
      William McGinty

    Title:
      Senior Vice President

     

    

    
      
        
          [Signature
            Page to Credit Agreement]

          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

    

    

    GUARANTY
      BANK, as a Lender

     

    By:
      /s/
      Amy Satsky

    Name:
      Amy
      Satsky

    Title:
      Senior Vice President

     

    

    
      
        
          [Signature
            Page to Credit Agreement]

          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

    

    

    REGIONS
      FINANCIAL CORPORATION, as a Lender

     

    By:
      /s/
      Ronny Hudspeth

    Name:
      Ronny Hudspeth

    Title:
      Sr. Vice President

     

    

    
      
        
          [Signature
            Page to Credit Agreement]

          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

    

    

    JPMORGAN
      CHASE BANK, N.A., as a Lender

     

    By:
      /s/
      Michael P. O’Keefe

    Name:
      Michael P. O’Keefe

    Title:
      Vice President

     

    

    
      
        
          [Signature
            Page to Credit Agreement]

          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

    

    

    CITY
      NATIONAL BANK, a national banking association, as a Lender

     

    By:
      /s/
      Mary Bowman

    Name:
      Mary Bowman

    Title:
      Senior Vice President

     

    

    
      
        
          [Signature
            Page to Credit Agreement]

          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

    

    

    PNC
      BANK,
      N.A., as a Lender

     

    By:
      /s/
      Douglas G. Paul

    Name:
      Douglas G. Paul

    Title:
      Senior Vice President

     

    

    
      
        
          [Signature
            Page to Credit Agreement]

          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

    

    

    UBS
      LOAN
      FINANCE, LLC, as a Lender

     

    By:
      /s/
      Irja R. Otsa

    Name:
      Irja R. Otsa

    Title:
      Associate Director

     

    By:
      /s/
      Mary E. Evans

    Name:
      Mary E. Evans

    Title:
      Associate Director

     

    

    
      
        
          [Signature
            Page to Credit Agreement]

          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

    

    

    COMERICA
      BANK, as a Lender

     

    By:
      /s/
      James Graycheck

    Name:
      James Graycheck

    Title:
      Vice President

     

    

     

    

     

    

    
      
        
          
            [Signature
              Page to Credit Agreement]

          

          
          

        

        
          
          

          
            

          

        

        
          
          

          
          

        

      

    

    

    Schedule
      I

    COMMITMENT
      SCHEDULE

     

    

    

    
      	
              Lenders

            	
              Commitment
                Percentage

            	
              Commitment

            
	
              Wachovia
                Bank

               

            	
              15%

            	
              $75,000,000

               

            
	
              Citibank,
                N.A.

               

            	
              15%

            	
              $75,000,000

               

            
	
              BNP
                Paribas

               

            	
              15%

            	
              $75,000,000

               

            
	
              The
                Royal Bank of Scotland

               

            	
              15%

               

            	
              $75,000,000

               

            
	
              Guaranty
                Bank

               

            	
              10%

               

            	
              $50,000,000

               

            
	
              Regions
                Financial Corporation

               

            	
              10%

               

            	
              $50,000,000

               

            
	
              JPMorgan
                Chase Bank

               

            	
              7%

               

            	
              $35,000,000

               

            
	
              City
                National Bank

               

            	
              5%

               

            	
              $25,000,000

               

            
	
              PNC
                Bank

               

            	
              3%

               

            	
              $15,000,000

               

            
	
              UBS
                Loan Finance, LLC

               

            	
              3%

               

            	
              $15,000,000

               

            
	
              Comerica
                Bank

               

            	
              2%

               

            	
              $10,000,000

               

            
	
              TOTAL

               

            	
              100%

               

            	
              $500,000,000

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00126-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00126-of-00352.parquet"}]]