Document:

Exhibit 10.6

THIRD AMENDMENT OF PURCHASE AND SALE AGREEMENT

WHEREAS, on November 16, 2006, Smith Production Inc. (“Smith”), a Texas
corporation, as seller, and Edge Petroleum Exploration Company (“Edge”), a
Delaware corporation, as purchaser, entered into two different Purchase and
Sale Agreements, each Purchase and Sale Agreement being effective as of January
1, 2007, at 12:01 a.m., but each Purchase and Sale Agreement covering different
oil and gas properties.

WHEREAS, in order
to differentiate one Purchase and Sale Agreement from the other for purposes of
description and reference in this Third Amendment of Purchase
and Sale Agreement  (the “Amendment”),
Edge and Smith stipulate and agree that (i) the Purchase and Sale  Agreement in which the first page of Exhibit
1.2(a) Leases describes the Angelita Prospect in San Patricio County, Texas
shall be described as “Purchase and Sale Agreement #1” and (ii) the Purchase
and Sale Agreement in which the first page of Exhibit 1.2(a) Leases describes
the Black Stone Prospect in Hidalgo County, Texas shall be described as “Purchase
and Sale Agreement #2.”

WHEREAS, this
Amendment pertains only to Purchase and Sale Agreement #1 which is referred to
in this Amendment as the “Agreement”.

WHEREAS, Smith and
Edge amended the Agreement
by First Amendment of Purchase and Sale Agreement executed on December 15,
2006.

WHEREAS, Smith and
Edge amended the Agreement
by Second Amendment of Purchase
and Sale Agreement executed on January 15, 2007.

WHEREAS, Smith and
Edge desire to amend the Agreement
a final time as set forth below by executing this Amendment.

NOW THEREFORE, for
valuable consideration received, Smith and Edge
hereby amend the Agreementas
follows:

1. Section 11.3(a) of the Agreement is
amended by adding the following at the end of the section: “Notwithstanding
anything to the contrary set forth in this Section 11.3(a), Seller and
Purchaser agree and stipulate that, in the event of Closing, Purchaser hereby
assumes, becomes liable for, agrees to perform and discharge all obligations
and liabilities of Seller to the extent that they are attributable to or arise
out of that certain litigation styled Smith Production Inc. v.
Zeke Paul, filed in Cause No. 69279 in Liberty County, Texas.”

2.
Section 11.3(b) of the Agreement
is amended as follows:

(a)
the period (ending punctuation) at the end of 11.3(b)(ix) is deleted and
replaced with a semi-colon as ending punctuation;

(b) the word “OR” is inserted at the end
of 11.3(b)(ix) after the semi-colon; and

(c) the following text is added as a new
11.3(b)(x):

(x)
that certain litigation styled Smith Production Inc. v.
Zeke Paul, filed in Cause No. 69279 in Liberty County, Texas.

3.
Section 11.5 of the Agreement is amended by adding the following text: “Purchaser’s
Indemnification Obligations in Section 11.3(b)(x) shall terminate after that
certain litigation styled Smith Production Inc. v.
Zeke Paul, filed in Cause No. 69279 in Liberty County, Texas has
been finally resolved or settled by all parties to said lawsuit by entry of a
non-appealable, final judgment in a court of competent jurisdiction or by a
final settlement agreement.

To the extent that any other provisions in the Agreement require amendment in order to make
the context of such provisions correct as the result of the foregoing
amendments, all such provisions in the Agreement that require amendment are deemed to be amended.

As
amended herein, the Agreement is hereby adopted, ratified and confirmed as
being in full force and effect.

This Amendment
shall be binding on each party that executes same, regardless of whether the
Amendment is executed by all of the parties who are named below. The provisions
of this Amendment shall be binding upon and inure to the benefit of each
signatory party and their respective successors and assigns.

This Amendment may
be executed in one or more counterparts, each of which shall have the same
force and effect as an original, and each counterpart shall be binding upon the
parties executing the same.

IN WITNESS
WHEREOF, this Amendment is executed as of the dates shown below to be effective
as of November 16, 2006.

	
  Smith Production Inc.

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  By:

  	
   

  	
  /s/ Glenn R. Smith

  	
   

  	
   

  
	
  Glenn R. Smith, President

  	
   

  	
   

  
	
  Date: January 31, 2007

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Edge Petroleum Exploration Company

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  By:

  	
   

  	
  /s/ C. W. MacLeod

  	
   

  	
   

  
	
  C.W. MacLeod

  	
   

  	
   

  
	
  Senior Vice President Business Development and
  Planning

  
	
  Date: January 31,
  2007

  	
   

  	
   

  

 

 2Exhibit 10.1

REGISTRATION RIGHTS AGREEMENT

by and between

AFFORDABLE RESIDENTIAL COMMUNITIES INC.

and

C. CLIFTON ROBINSON

Dated as of January 31, 2007

TABLE OF
CONTENTS

	
   

  	
   

  	
   

  	
   

  	
  PAGE

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  1.

  	
   

  	
  Definitions

  	
   

  	
  1

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  2.

  	
   

  	
  Shelf Registration Statements

  	
   

  	
  2

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  3.

  	
   

  	
  Holdback Agreements

  	
   

  	
  3

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  4.

  	
   

  	
  Registration Procedures

  	
   

  	
  3

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  5.

  	
   

  	
  Registration Expenses

  	
   

  	
  5

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  6.

  	
   

  	
  Indemnification

  	
   

  	
  6

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  7.

  	
   

  	
  Participation in Underwritten Registrations

  	
   

  	
  8

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  8.

  	
   

  	
  Rule 144 Reporting

  	
   

  	
  9

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  9.

  	
   

  	
  Notices

  	
   

  	
  9

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  10.

  	
   

  	
  Miscellaneous

  	
   

  	
  10

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  (a)

  	
  Other Registration Rights

  	
   

  	
  10

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  (b)

  	
  Remedies

  	
   

  	
  11

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  (c)

  	
  Discontinued Disposition

  	
   

  	
  11

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  (d)

  	
  Amendments and Waivers

  	
   

  	
  11

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  (e)

  	
  Successors and Assigns

  	
   

  	
  11

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  (f)

  	
  Severability

  	
   

  	
  11

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  (g)

  	
  Counterparts

  	
   

  	
  11

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  (h)

  	
  Descriptive Headings

  	
   

  	
  11

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  (i)

  	
  Recapitalizations, Exchanges Affecting the
  Registrable Securities

  	
   

  	
  11

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  (j)

  	
  Governing Law

  	
   

  	
  12

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  (k)

  	
  Third Party Beneficiaries

  	
   

  	
  12

  

 

REGISTRATION RIGHTS AGREEMENT

THIS REGISTRATION RIGHTS AGREEMENT (this “Agreement”),
dated as of January 31, 2007 is by and between Affordable Residential
Communities Inc., a Maryland corporation (the “Company”) and C. Clifton
Robinson, an individual (“Holder”).

WHEREAS, pursuant
to the terms of a Stock Purchase Agreement (the “Purchase Agreement”)
dated as of October 6, 2006, by and between the Company and ARC Insurance
Holdings Inc., on the one hand, and C. Clifton Robinson, C.C. Robinson Property
Company, Ltd. and The Robinson Charitable Remainder Unitrust (collectively, the
“Sellers”), on the other hand, the Company has agreed, as partial consideration
for the acquisition by the Company from Sellers of 100% of the outstanding
shares of capital stock of NLASCO, Inc., a Delaware corporation, to issue to C.
Clifton Robinson 1,218,880 shares of common stock, $0.01 par value per share,
of the Company (the “Shares”).

WHEREAS, it is a
condition to the closing of the Purchase Agreement that the Company and Holder
execute this Agreement.

NOW, THEREFORE, in consideration of the
mutual covenants contained herein and other good and valuable consideration,
the receipt and sufficiency of which are hereby acknowledged, the parties to
this Agreement hereby agree as follows:

1.                                       Definitions.  Capitalized
terms used and not otherwise defined herein that are defined in the Purchase
Agreement shall have the meanings given such terms in the Purchase Agreement.
As used in this Agreement, the following terms shall have the following
meanings:

“Advice” shall have the meaning set
forth in Section 10(c).

“Agreement” shall have the meaning set
forth in the Preamble.

“Business Day” means any calendar day
which is not a Saturday, Sunday or a day on which banks in the State of Texas
are generally closed for regular business.

“Common Stock” means the common stock,
$0.01 par value per share, of the Company.

“Company” shall have the meaning set
forth in the Preamble.

“Delay Period” shall have the meaning
set forth in Section 2.

“Exchange Act” means the Securities
Exchange Act of 1934, as amended, or any successor statute.

“Holdback Agreements” shall have the
meaning set forth in Section 3.

“Holder” shall have the meaning set
forth in the Preamble.

“Indemnified Party” shall have the
meaning set forth in Section 6(c).

“Indemnifying Party” shall have the
meaning set forth in Section 6(c).

“Losses” shall have the meaning set
forth in Section 6(a).

“Person” means an individual,
corporation, partnership, trust, joint venture, limited liability company,
unincorporated organization or other legal entity or a government or any agency
or political subdivision thereof.

“Proceeding” means an action, claim,
suit, investigation or proceeding (including, without limitation, an
investigation or partial proceeding, such as a deposition), whether commenced
or threatened.

“Purchase Agreement” shall have the
meaning set forth in the Recitals.

“Registrable Securities” means (i) the
Shares issued to the Holder pursuant to the 
Purchase Agreement and (ii) all shares of Common Stock issued upon any
stock split, dividend or other distribution, recapitalization or similar event
with respect to, or in exchange or in replacement of, the Shares; provided
that Shares shall cease to be Registrable Securities when such Shares: (a) are
eligible to be sold pursuant to Rule 144(k) under the Securities Act or they
are sold pursuant to Rule 144 under circumstances in which any legend thereon
relating to restrictions on the transferability thereof is removed by the
Company; (b) shall have been sold pursuant to a registration statement
effective under the Securities Act; or (c) shall have ceased to be outstanding.

“Registration Expenses” means all
expenses incurred or incident to the Company’s performance of or compliance
with this Agreement, including without limitation all registration and filing
fees (including any such fees paid or payable to the National Association of
Securities Dealers, Inc. or the New York Stock Exchange), fees and expenses of
compliance with securities or blue sky laws, printing expenses, messenger and
delivery expenses, and fees and disbursements of counsel for the Company and
all independent certified public accountants (including the costs of any
accountants’ “comfort letters”), underwriters (excluding underwriting discounts
and commissions with respect to any Registrable Securities) and other Persons
retained by the Company.

“Registration Statement” shall have
the meaning set forth in Section 2.

“Rule 144” means Rule 144 under the
Securities Act (or any similar rule then in force).

“SEC” means the Securities and
Exchange Commission.

“Securities Act” means the Securities
Act of 1933, as amended, or any successor statute.

“Shares” shall have the meaning set
forth in the Recitals.

2.                                       Shelf
Registration Statements. On or before the 18-month anniversary
of the Closing Date, the Company shall file with the SEC a registration
statement on Form S-3 (except if the Company is not then eligible to register
for resale the Registrable Securities on Form S-3, such registration shall be
on another appropriate form) (together with the prospectus included

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therein, the “Registration
Statement”) pursuant to Rule 415 of the Securities Act in order to register
with the SEC the resale, from time to time, by the Holder of all the Registrable
Securities. The Registration Statement required hereunder shall contain
(except if otherwise directed by the Holder) substantially the “Plan of
Distribution” furnished by the Holder. The Company shall use its reasonable
best efforts to cause the Registration Statement to be declared effective as
soon thereafter as is practicable.  The Company shall use its reasonable
best efforts to keep the Registration Statement effective in order to permit
the prospectus forming a part thereof to be usable by the Holder for the sale
of Common Stock held by him, until all of Common Stock registered thereunder
has been distributed as contemplated thereby, but in any event not later than
the second anniversary of the date the Registration Statement is declared effective
by the SEC.  The foregoing notwithstanding, the Company shall have the
right in its sole discretion, based on any valid business purpose (including,
without limitation, to avoid the disclosure of any material non-public
information that the Company is not otherwise obligated to disclose), to
suspend the use of the Registration Statement for a reasonable length of time
(a “Delay Period”) and from time to time; provided that the
aggregate number of days in all Delay Periods occurring in any period of twelve
consecutive months shall not exceed 90 days.  The Company shall provide
written notice to the Holder of the beginning and the end of each Delay Period,
and the Holder shall cease all disposition efforts pursuant to the Registration
Statement with respect to all Common Stock held by him immediately upon receipt
of notice of the beginning of any Delay Period and shall maintain in confidence
the fact that such notice has been provided by the Company.

3.                                       Holdback
Agreements.  In
connection with any underwritten public offering with respect to the resale of
the Registrable Securities, the Holder of Registrable Securities shall enter
into such agreements, including underwriting agreements and lock-up agreements,
as the managing underwriter of any offering registered under the Securities Act
shall reasonably request (collectively, “Holdback Agreements”); provided,
however, that with respect to any registrations, such Holdback
Agreements shall not exceed a period of 14 calendar days prior to, and 180
calendar days after, the effective date of such registration.

4.                                       Registration
Procedures.  In connection with the Company’s
registration obligations hereunder, the Company shall:

(a)                                  prepare and
file with the SEC a registration statement with respect to such Registrable
Securities and use its reasonable best efforts to cause such registration
statement to become effective as promptly as practicable after filing; provided,
that not less than four business days before filing a registration statement or
prospectus or any amendments or supplements thereto, the Company will furnish
to the counsel selected by the Holder copies of all such documents proposed to
be filed; provided further, that no such registration statement
or prospectus or amendment or supplement thereto shall be filed unless the
Holder of Registrable Securities to be included in such registration statement
and, if the offering is an underwritten offering, counsel to the underwriters,
have had a reasonable opportunity to provide comments thereon; provided further,
that the Holder of the Registrable Securities shall have provided comments
promptly following his receipt of such registration statement or prospectus or
amendment or supplement thereto; provided further, that such comments
are reasonably determined by the Company to be appropriate or necessary and in
conformity with applicable law and good business practices;

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(b)                                 (i) prepare and
file with the SEC such amendments and supplements to such registration
statement and the prospectus used in connection therewith as may be necessary
to keep such registration statement effective for a period of not less than two
years and (ii) use its reasonable best efforts to have such supplements or
amendments declared effective, if required, as soon as practicable after filing;
provided, that no such amendment or supplement shall be filed unless the
Holder of Registrable Securities to be included in such registration statement
and, if the offering is an underwritten offering, counsel to the underwriters,
have had a reasonable opportunity to provide comments thereon; provided further,
that the Holder of the Registrable Securities shall have provided comments
promptly following his receipt of such amendment or supplement; provided
further, that such comments are reasonably determined by the Company to be
appropriate or necessary and in conformity with applicable law and good
business practices;

(c)                                  furnish to each
seller of Registrable Securities, without charge, such number of copies of such
registration statement, each amendment and supplement thereto, the prospectus
included in such registration statement (including each preliminary prospectus)
and such other documents as such seller may reasonably request in order to
facilitate the disposition of the Registrable Securities owned by such seller;

(d)                                 use its
reasonable best efforts to register or qualify such Registrable Securities
under such other securities or blue sky laws of such jurisdictions as any
seller reasonably requests and do any and all other acts and things which may
be reasonably necessary or advisable to enable such seller to consummate the
disposition in such jurisdictions of the Registrable Securities owned by such
seller (provided that the Company will not be required to (i) qualify generally
to do business in any jurisdiction where it would not otherwise be required to
qualify but for this subsection, (ii) subject itself to taxation in any such
jurisdiction or (iii) consent to general service of process (i.e.,
service of process which is not limited solely to securities law violations) in
any such jurisdiction);

(e)                                  promptly notify
each seller of such Registrable Securities of the happening of any event as a
result of which the prospectus included in such registration statement contains
an untrue statement of a material fact or omits any material fact necessary to
make the statements therein not misleading, promptly prepare a supplement or
amendment to such prospectus so that, as thereafter delivered to the purchasers
of such Registrable Securities, such prospectus will not contain an untrue
statement of a material fact or omit to state any material fact necessary to
make the statements therein, in light of the circumstances under which they
were made, not misleading, and promptly furnish to each seller of Registrable
Securities, without charge, copies of such prospectus supplement or amended
prospectus;

(f)                                    use its
reasonable best efforts to cause all such Registrable Securities to be listed
on each securities exchange or automated quotation system on which securities
of the same class issued by the Company are then listed and, if not so listed,
use commercially reasonable efforts to cause such Registrable Securities to be
authorized for quotation on the New York Stock Exchange or to be listed on a
national securities exchange selected by the Company;

(g)                                 provide a
transfer agent and registrar for all such Registrable Securities not later than
the effective date of such registration statement;

 4
 

(h)                                 enter into such
customary agreements (including underwriting agreements in customary form with
customary indemnity and contribution obligations to the underwriters) and take
all such other actions as the holders of a majority of the Registrable
Securities being sold or the underwriters, if any, reasonably request in order to
expedite or facilitate the disposition of such Registrable Securities
(including, without limitation, effecting a stock split or a combination of
shares);

(i)                                     otherwise use
its reasonable best efforts to comply with all applicable rules and regulations
of the SEC, and make available to its security holders, as soon as reasonably
practicable, an earning statement covering the period of at least twelve months
beginning with the first day of the first full calendar quarter of the Company
after the effective date of the registration statement, which earning statement
shall satisfy the provisions of Section 11(a) of the Securities Act and
Rule 158 promulgated thereunder;

(j)                                     promptly notify
the selling Holder and the underwriters, if any, of the issuance or threatened
issuance of any stop order suspending the effectiveness of a registration
statement, or of any order suspending or preventing the use of any related
prospectus or suspending the qualification of any securities included in such
registration statement for sale in any jurisdiction and use its reasonable best
efforts promptly to either obtain the prompt withdrawal of any such order that
is issued or prevent the issuance of any such threatened order;

(k)                                  use its
reasonable best efforts to cause such Registrable Securities covered by such
registration statement to be registered with or approved by such other
governmental agencies or authorities as may be necessary to enable the sellers
thereof to consummate the disposition of such Registrable Securities; and

(l)                                     promptly notify
Holder, and each underwriter (A) when a registration statement or any related
prospectus or any amendment or supplement has been filed, and, with respect to
a registration statement or any amendment thereto, when the same has become
effective or (B) of any request by the SEC for amendments or supplements to the
registration statement or the related prospectus or for additional information.

It shall be a condition precedent to the
obligation of the Company to take any action with respect to any Registrable
Securities pursuant to this Section 4 that the Holder thereof shall (i)
furnish to the Company such information regarding the Holder, the Registrable
Securities and any other securities of the Company held by the Holder as the
Company shall reasonably request and as shall be required in connection with
the action taken by the Company and (ii) enter into such customary agreements
(including underwriting agreements in customary form with customary indemnity
and contribution obligations to the underwriters) and take all such other
actions as the holders of a majority of the Registrable Securities being sold
or the underwriters, if any, reasonably request in order to expedite or
facilitate the disposition of such Registrable Securities (including, without
limitation, effecting a stock split or a combination of shares).

5.                                       Registration
Expenses. All reasonable expenses incident to the Company’s
performance of or compliance with this Agreement, including without limitation
all Registration Expenses of the Company and the Holder, will be borne by the
Company, with respect to any registration, proposed or otherwise, of its
securities; provided, however, that notwithstanding

 5
 

anything to the contrary
contained herein, the Holder shall bear and pay all underwriting discounts and
commissions and all transfer taxes, if any, attributable to and/or payable in
respect of any sale of Registrable Securities by the Holder.  In no event shall the Company be responsible
for any broker or similar commissions or any legal fees or other similar costs
of the Holder.

6.                                       Indemnification.

(a)                                  Indemnification
by the Company.  The Company
shall, notwithstanding any termination of this Agreement, indemnify and hold
harmless Holder, the agents and employees of the Holder, each Person who
controls the Holder (within the meaning of Section 15 of the Securities Act or
Section 20 of the Exchange Act) and the officers, directors, agents and
employees of each such controlling Person, to the fullest extent permitted by
applicable law, from and against any and all losses, claims, damages,
liabilities, costs (including, without limitation, reasonable attorneys’ fees)
and expenses (collectively, “Losses”), as incurred, arising out of or
relating to any untrue or alleged untrue statement of a material fact contained
in the Registration Statement, any prospectus or any form of prospectus or in
any amendment or supplement thereto or in any preliminary prospectus, or
arising out of or relating to any omission or alleged omission of a material
fact required to be stated therein or necessary to make the statements therein
(in the case of any prospectus or form of prospectus or supplement thereto, in
light of the circumstances under which they were made) not misleading, except
to the extent, but only to the extent, that (i) such untrue statements or
omissions are based upon information regarding the Holder furnished to the
Company by the Holder expressly for use therein, or to the extent that such
information relates to the Holder or the Holder’s proposed method of
distribution of Registrable Securities or (ii) in the case of an occurrence of
an event of the type specified in Section 4(e) or (j), the use by the
Holder of an outdated or defective prospectus after the Company has notified the
Holder that the prospectus is outdated or defective and prior to the receipt by
the Holder of the Advice contemplated in Section 10(c).  The Company shall notify the Holder promptly
of the institution, threat or assertion of any Proceeding of which the Company
is aware in connection with the transactions contemplated by this
Agreement.  Notwithstanding the
foregoing, the Company will not be liable to any Person who participates as an
underwriter in the offering or sale of Registrable Securities or any other Person,
if any, who controls such underwriter within the meaning of the Securities Act,
under the indemnity agreement in this Section 6(a) with respect to any
preliminary prospectus or the final prospectus as amended or supplemented, as
the case may be, to the extent that any Losses of such underwriter or
controlling Person results from the fact that such underwriter sold Registrable
Securities to a Person to whom there was not sent or given, at or prior to the
written confirmation of such sale, a copy of the final prospectus (including
any documents incorporated by reference therein) or of the final prospectus as
then amended or supplemented (including any documents incorporated by reference
therein), whichever is most recent, if the Company has previously furnished
sufficient copies thereof to such underwriter.

(b)                                 Indemnification
by Holder. The Holder shall indemnify and hold harmless the
Company, its directors, officers, agents and employees, each Person who
controls the Company (within the meaning of Section 15 of the Securities Act
and Section 20 of the Exchange Act), and the directors, officers, agents or
employees of such controlling Persons, to the fullest extent permitted by
applicable law, from and against all Losses, as incurred, to the

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extent arising out of or
based upon: (x) the Holder’s failure to comply with the prospectus delivery
requirements of the Securities Act or (y) any untrue or alleged untrue
statement of a material fact contained in any Registration Statement, any
prospectus, or any form of prospectus, or in any amendment or supplement
thereto or in any preliminary prospectus, or arising out of or relating to any
omission or alleged omission of a material fact required to be stated therein
or necessary to make the statements therein not misleading (i) to the extent,
but only to the extent, that such untrue statement or omission is contained in
any information so furnished by the Holder to the Company specifically for
inclusion in the Registration Statement or such prospectus or (ii) to the
extent that (1) such untrue statements or omissions are based upon information
regarding the Holder furnished to the Company by the Holder expressly for use
therein, or to the extent that such information relates to the Holder or the
Holder’s proposed method of distribution of Registrable Securities or (2) in
the case of an occurrence of an event of the type specified in
Section 4(e) or (j), the use by the Holder of an outdated or defective
prospectus after the Company has notified the Holder that the prospectus is
outdated or defective and prior to the receipt by the Holder of the Advice
contemplated in Section 10(c); provided, however, the aggregate amount the
Holder is required to pay pursuant to this Section 6(b), for claims arising
solely from the sale of any stock under this Agreement, shall in no event
exceed the net proceeds received by the Holder upon a sale of Registrable
Securities giving rise to an indemnity claim.

(c)                                  Conduct of
Indemnification Proceedings. If any Proceeding shall be
brought or asserted against any Person entitled to indemnity hereunder (an “Indemnified
Party”), such Indemnified Party shall promptly notify the Person from whom
indemnity is sought (the “Indemnifying Party”) in writing, and the
Indemnifying Party shall have the right to assume the defense thereof,
including the employment of counsel reasonably satisfactory to the Indemnified
Party and the payment of all fees and expenses incurred in connection with
defense thereof; provided, that the failure of any Indemnified Party to give
such notice shall not relieve the Indemnifying Party of its obligations or
liabilities pursuant to this Agreement, except (and only) to the extent that it
shall be finally determined by a court of competent jurisdiction (which
determination is not subject to appeal or further review) that such failure
shall have materially prejudiced the Indemnifying Party.

An Indemnified Party shall have the right to employ separate counsel in
any such Proceeding and to participate in the defense thereof, but the fees and
expenses of such counsel shall be at the expense of such Indemnified Party or
Parties unless:  (1) the Indemnifying
Party has agreed in writing to pay such fees and expenses; (2) the Indemnifying
Party shall have failed promptly to assume the defense of such Proceeding and
to employ counsel reasonably satisfactory to such Indemnified Party in any such
Proceeding; or (3) the named parties to any such Proceeding (including any
impleaded parties) include both such Indemnified Party and the Indemnifying
Party, and such Indemnified Party shall reasonably believe that a material
conflict of interest is likely to exist if the same counsel were to represent
such Indemnified Party and the Indemnifying Party (in which case, if such
Indemnified Party notifies the Indemnifying Party in writing that it elects to
employ separate counsel at the expense of the Indemnifying Party, the
Indemnifying Party shall not have the right to assume the defense thereof and
the reasonable fees and expenses of one separate counsel shall be at the
expense of the Indemnifying Party).  The
Indemnifying Party shall not be liable for any settlement of any such
Proceeding effected without its written consent, which consent shall not be
unreasonably withheld.  No Indemnifying
Party

 7
 

shall, without the prior written consent of the Indemnified Party,
effect any settlement of any pending Proceeding in respect of which any
Indemnified Party is a party, unless such settlement includes an unconditional
release of such Indemnified Party from all liability on claims that are the
subject matter of such Proceeding.

Subject to the terms of this Agreement, all reasonable fees and
expenses of the Indemnified Party (including reasonable fees and expenses to
the extent incurred in connection with investigating or preparing to defend
such Proceeding in a manner not inconsistent with this Section) shall be paid
to the Indemnified Party, as incurred, within thirty (30) days of written
notice thereof to the Indemnifying Party; provided, that the Indemnified
Party shall promptly reimburse the Indemnifying Party for that portion of such
fees and expenses applicable to such actions for which such Indemnified Party
is not entitled to indemnification hereunder, determined based upon the
relative faults of the parties.

(d)                                 Contribution.  If a claim for indemnification under Section
6(a) or 6(b) is unavailable to an Indemnified Party (by reason of public policy
or otherwise), then each Indemnifying Party, in lieu of indemnifying such
Indemnified Party, shall contribute to the amount paid or payable by such
Indemnified Party as a result of such Losses, in such proportion as is
appropriate to reflect the relative fault of the Indemnifying Party and
Indemnified Party in connection with the actions, statements or omissions that
resulted in such Losses as well as any other relevant equitable
considerations.  The relative fault of
such Indemnifying Party and Indemnified Party shall be determined by reference
to, among other things, whether any action in question, including any untrue or
alleged untrue statement of a material fact or omission or alleged omission of
a material fact, has been taken or made by, or relates to information supplied
by, such Indemnifying Party or Indemnified Party, and the parties’ relative
intent, knowledge, access to information and opportunity to correct or prevent
such action, statement or omission.  The
amount paid or payable by a party as a result of any Losses shall be deemed to
include, subject to the limitations set forth in this Agreement, any reasonable
attorneys’ or other reasonable fees or expenses incurred by such party in
connection with any Proceeding to the extent such party would have been
indemnified for such fees or expenses if the indemnification provided for in
this Section was available to such party in accordance with its terms.

The parties hereto agree that it would not be just and
equitable if contribution pursuant to this Section 6(d) were determined by pro
rata allocation or by any other method of allocation that does not take into
account the equitable considerations referred to in the immediately preceding
paragraph.  Notwithstanding the
provisions of this Section 6(d), the Holder shall not be required to
contribute, in the aggregate, any amount in excess of the amount by which the
proceeds actually received by the Holder from the sale of the Registrable
Securities subject to the Proceeding exceeds the amount of any damages that the
Holder has otherwise been required to pay by reason of such untrue or alleged
untrue statement or omission or alleged omission, except in the case of fraud
by the Holder.

The indemnity and contribution agreements contained in this Section are
in addition to any liability that the Indemnifying Parties may have to the
Indemnified Parties.

7.                                       Participation
in Underwritten Registrations.  No Person may
participate in any registration hereunder which is underwritten unless such
Person (a) agrees to sell such Person’s

 8
 

securities on the basis
provided in any underwriting arrangements approved by the Person or Persons
entitled hereunder to approve such arrangements and (b) completes and executes
all customary questionnaires, powers of attorney, indemnities, underwriting
agreements and other documents reasonably required under the terms of such
underwriting arrangements.

8.                                       Rule 144
Reporting.  With a view to making available to the
holders of Registrable Securities the benefits of certain rules and regulations
of the SEC which may permit the sale of the Registrable Securities to the
public without registration, the Company agrees to use its reasonable best
efforts to:

(a)                                  make and keep
current public information available, within the meaning of Rule 144 or any
similar or analogous rule promulgated under the Securities Act, at all times
after it has become subject to the reporting requirements of the Exchange Act;

(b)                                 file with the
SEC, in a timely manner, all reports and other documents required under the
Securities Act and Exchange Act (after it has become subject to such reporting
requirements);

(c)                                  so long as any
party hereto owns any Registrable Securities, furnish to such Person forthwith
upon request a written statement as to its compliance with the reporting
requirements of said Rule 144 (at any time commencing 90 days after the
effective date of the first registration filed by the Company for an offering
of its securities to the general public), the Securities Act and the Exchange
Act (at any time after it has become subject to such reporting requirements); a
copy of its most recent annual or quarterly report; and such other reports and
documents as such Person may reasonably request in availing itself of any rule
or regulation of the SEC allowing it to sell any such securities without
registration; and

(d)                                 in connection
with any sale, transfer or other disposition by the Holder of any Registrable
Securities pursuant to Rule 144 promulgated under the Securities Act, cooperate
with such holder to facilitate the timely preparation and delivery of
certificates representing the Registrable Securities to be sold and not bearing
any Securities Act legend, and enable certificates for such Registrable
Securities to be for such number of shares and registered in such name as the
selling Holder may reasonably request in writing no more than three (3)
Business Days after any sale of Registrable Securities; provided, that,
if requested by the Company, the Holder shall have furnished to the Company an
opinion of counsel reasonably satisfactory to the Company and the Company’s
counsel that registration of such Registrable Securities under the Securities
Act is not required.

9.             Notices. All notices, demands or
other communications to be given or delivered under or by reason of the
provisions of this Agreement will be in writing and will be deemed to have been
given when delivered personally, mailed by certified or registered mail, return
receipt requested and postage prepaid, or the day after sent if sent via a
nationally recognized overnight courier, or upon written confirmation if sent
via facsimile to any recipient. Such notices, demands and other communications
will be sent to the address indicated below:

 9
 

 

To the Company:

Affordable
Residential Communities Inc.

600
Grant Street, Suite 900

Denver,
Colorado  80203

Attention: 
Scott L. Gesell, Esq.

Facsimile No.: (303) 749-2073

To the Holder:

C. Clifton Robinson

900 Austin Avenue, 12th Floor

Waco, Texas 76701

Facsimile No.: (254)
756-0050

In each case, with copies to
each of:

Skadden,
Arps, Slate, Meagher & Flom LLP

Four
Times Square

New
York, New York  10036

Attention: 
Fred B. White, III,  Esq.

Facsimile No.:  (212)
735-2000

Haynes and Boone, LLP

901 Main Street, Suite 3100

Dallas, Texas 75202

Attn: Michael M. Boone

Facsimile No.: (214)
200-0369

Beard Kultgen Brophy
Bostwick & Dickson, LLP

5400 Bosque Blvd., Suite
301

Waco, Texas 76710

Attn: Richard E. Brophy,
Jr.

Facsimile No.: (254)
776-3591

or such other address or to
the attention of such other person as the recipient party shall have specified
by prior written notice to the sending party.

10.                                 Miscellaneous.

(a)                                  Other Registration
Rights. Notwithstanding anything contained in this Agreement to the contrary,
the registration rights granted to the Holder under this Agreement shall be
subordinate to the registration rights granted pursuant to that certain Third
Amended and Restated Registration Rights Agreement dated as of February 18,
2004 by and among the Company and the parties listed on the exhibits thereto.

 10
 

(b)           Remedies.  Any Person
having rights under any provision of this Agreement will be entitled to enforce
such rights specifically to recover damages caused by reason of any breach of
any provision of this Agreement and to exercise all other rights granted by
law. The parties hereto agree and acknowledge that money damages may not be an
adequate remedy for any breach of the provisions of this Agreement and that any
party may in its sole discretion apply to any court of law or equity of
competent jurisdiction (without posting any bond or other security) for
specific performance and for other injunctive relief in order to enforce or
prevent violation of the provisions of this Agreement.

(c)           Discontinued Disposition.  The Holder agrees by its acquisition of such
Registrable Securities that, upon receipt of a notice from the Company of the
occurrence of any event of the kind described in Section 4(e) or (j), the
Holder will forthwith discontinue disposition of such Registrable Securities
under the Registration Statement until the Holder’s receipt of the copies of
the supplemented prospectus and/or amended Registration Statement or until it
is advised in writing (the “Advice”) by the Company that the use of the
applicable prospectus may be resumed, and, in either case, has received copies
of any additional or supplemental filings that are incorporated or deemed to be
incorporated by reference in such prospectus or Registration Statement.  The Company will use its best efforts to
ensure that the use of the prospectus may be resumed as promptly as it
practicable.

(d)           Amendments and Waivers. Except
as otherwise provided herein, the provisions of this Agreement may be amended
or waived only upon the prior written consent of the Company and the Holder,
provided, however, that any amendment or waiver of any provision of this
Agreement which adversely affects the rights of any party to this Agreement
shall be executed by each such party.

(e)           Successors and Assigns. This
Agreement shall be binding upon and inure to the benefit of the parties named
herein and their respective successors and permitted assigns.  No party may assign either this Agreement or
any of his, her, or its rights, interests, or obligations hereunder without the
prior written approval of the parties.

(f)            Severability.  Whenever possible, each provision of this
Agreement will be interpreted in such manner as to be effective and valid under
applicable law, but if any provision of this Agreement is held to be prohibited
by or invalid under applicable law, such provision will be ineffective only to
the extent of such prohibition or invalidity, without invalidating the remainder
of this Agreement.

(g)           Counterparts. This Agreement
may be executed simultaneously in two or more counterparts, any one of which
need not contain the signatures of more than one party, but all such
counterparts taken together will constitute one and the same Agreement.

(h)           Descriptive Headings. The
descriptive headings of this Agreement are inserted for convenience only and do
not constitute a part of this Agreement.

(i)            Recapitalizations, Exchanges
Affecting the Registrable Securities.  The provisions of this
Agreement shall apply, to the full extent set forth herein, with respect to the
Registrable Securities, to any and all shares of stock of the Company or any
successor or assign

 11
 

of the Company (whether by
merger, consolidation, sale of assets or otherwise) which may be issued in
respect of, in exchange for, or in substitution of the Registrable Securities,
by reason of a stock dividend, stock split, stock issuance, reverse stock
split, combination, recapitalization, reclassification, merger, consolidation
or otherwise.  Upon the occurrence of any of such events, amounts
hereunder shall be appropriately adjusted.

(j)            Governing Law.  This
Agreement shall be governed by and construed in accordance with the laws of the
State of Texas without giving effect to the conflicts of law principles
thereof.

(k)           Third Party Beneficiaries. 
This Agreement is not intended to confer upon any person other than the parties
hereto any rights or remedies hereunder.

*  *  *  *  *

 12

IN WITNESS WHEREOF, the undersigned have
executed this Agreement as of the day and year first above written.

	
  

  	
  AFFORDABLE RESIDENTIAL COMMUNITIES

  
	
   

  	
  INC., a Maryland corporation

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Scott L. Gesell

  
	
   

  	
   

  	
  Scott L. Gesell

  
	
   

  	
   

  	
  Executive Vice President

  

 

[Signature Page of Holder Follows]

Signature
Page to Registration Rights Agreement

 

	
  

  	
   

  	
  HOLDER:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  /s/ C. Clifton Robinson

  
	
   

  	
   

  	
  C. Clifton Robinson

  

 

Signature Page to Registration Rights Agreement

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