Document:

EX-10.1

Exhibit 10.1

UST Sequence Number: 114

United States Department of the Treasury

1500 Pennsylvania Avenue, NW

Washington, D.C. 20220

Dear Ladies and Gentlemen:

     The company set forth on the signature page hereto (the “Company”) intends to issue in a
private placement the number of shares of a series of its preferred stock set forth on Schedule A
hereto (the “Preferred Shares”) and a warrant to purchase the number of shares of its common stock
set forth on Schedule A hereto (the “Warrant” and, together with the Preferred Shares, the
“Purchased Securities”) and the United States Department of the Treasury (the “Investor”) intends
to purchase from the Company the Purchased Securities.

     The purpose of this letter agreement is to confirm the terms and conditions of the purchase by
the Investor of the Purchased Securities. Except to the extent supplemented or superseded by the
terms set forth herein or in the Schedules hereto, the provisions contained in the Securities
Purchase Agreement – Standard Terms attached hereto as Exhibit A (the “Securities Purchase
Agreement”) are incorporated by reference herein. Terms that are defined in the Securities Purchase
Agreement are used in this letter agreement as so defined. In the event of any inconsistency
between this letter agreement and the Securities Purchase Agreement, the terms of this letter
agreement shall govern.

     Each of the Company and the Investor hereby confirms its agreement with the other party with
respect to the issuance by the Company of the Purchased Securities and the purchase by the Investor
of the Purchased Securities pursuant to this letter agreement and the Securities Purchase Agreement
on the terms specified on Schedule A hereto.

     This letter agreement (including the Schedules hereto) and the Securities Purchase Agreement
(including the Annexes thereto) and the Warrant constitute the entire agreement, and supersede all
other prior agreements, understandings, representations and warranties, both written and oral,
between the parties, with respect to the subject matter hereof. This letter agreement constitutes
the “Letter Agreement” referred to in the Securities Purchase Agreement.

     This letter agreement may be executed in any number of separate counterparts, each such
counterpart being deemed to be an original instrument, and all such counterparts will together
constitute the same agreement. Executed signature pages to this letter agreement may be delivered
by facsimile and such facsimiles will be deemed as sufficient as if actual signature pages had been
delivered.

* * *

 

 

UST Sequence Number: 114

In witness whereof, this letter agreement has been duly executed and delivered by the duly
authorized representatives of the parties hereto as of the date written below.

	 	 	 	 	 
	 	UNITED STATES DEPARTMENT OF THE TREASURY

 	 
	 	By:  	/s/ Neel Kashkari
 	 
	 	Name:  	Neel Kashkari 	 
	 	Title:  	Interim Assistant Secretary for Financial Stability 	 

	 	 	 	 	 
	 	COMPANY: SOUTHWEST BANCORP, INC.

 	 
	 	By:  	/s/ Rick Green
 	 
	 	Name:  	Rick Green 	 
	 	Title:  	President and Chief Executive Officer 	 

Date: December 5, 2008

 

 

UST Sequence Number: 114

EXHIBIT A

SECURITIES PURCHASE AGREEMENT

 

 

UST Sequence Number: 114

EXHIBIT A

 

SECURITIES PURCHASE AGREEMENT

STANDARD TERMS

 

 

 

UST Sequence Number: 114

TABLE OF CONTENTS

	 	 	 	 	 
	 	 	Page
	Article I

	 
	 	 	 	 
	Purchase; Closing

	 
	 	 	 	 
	1.1 Purchase
	 	 	1	 
	1.2 Closing
	 	 	2	 
	1.3 Interpretation
	 	 	4	 
	 
	 	 	 	 
	Article II

	 
	 	 	 	 
	Representations and Warranties

	 
	 	 	 	 
	2.1 Disclosure
	 	 	4	 
	2.2 Representations and Warranties of the Company
	 	 	5	 
	 
	 	 	 	 
	Article III

	 
	 	 	 	 
	Covenants

	 
	 	 	 	 
	3.1 Commercially Reasonable Efforts
	 	 	13	 
	3.2 Expenses
	 	 	14	 
	3.3 Sufficiency of Authorized Common Stock; Exchange Listing
	 	 	14	 
	3.4 Certain Notifications Until Closing
	 	 	15	 
	3.5 Access, Information and Confidentiality
	 	 	15	 
	 
	 	 	 	 
	Article IV

	 
	 	 	 	 
	Additional Agreements

	 
	 	 	 	 
	4.1 Purchase for Investment
	 	 	16	 
	4.2 Legends
	 	 	16	 
	4.3 Certain Transactions
	 	 	18	 
	4.4 Transfer of Purchased Securities and Warrant Shares; Restrictions on Exercise of the Warrant
	 	 	18	 
	4.5 Registration Rights
	 	 	19	 
	4.6 Voting of Warrant Shares
	 	 	30	 
	4.7 Depositary Shares
	 	 	31	 
	4.8 Restriction on Dividends and Repurchases
	 	 	31	 
	4.9 Repurchase of Investor Securities
	 	 	32	 
	4.10 Executive Compensation
	 	 	33	 

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	 	 	Page
	Article V

	 
	 	 	 	 
	Miscellaneous

	 
	 	 	 	 
	5.1 Termination
	 	 	34	 
	5.2 Survival of Representations and Warranties
	 	 	34	 
	5.3 Amendment
	 	 	34	 
	5.4 Waiver of Conditions
	 	 	34	 
	5.5 Governing Law: Submission to Jurisdiction, Etc.
	 	 	35	 
	5.6 Notices
	 	 	35	 
	5.7 Definitions
	 	 	35	 
	5.8 Assignment
	 	 	36	 
	5.9 Severability
	 	 	36	 
	5.10 No Third Party Beneficiaries
	 	 	36	 

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LIST OF ANNEXES

ANNEX A: FORM OF CERTIFICATE OF DESIGNATIONS FOR PREFERRED STOCK

ANNEX B: FORM OF WAIVER

ANNEX C: FORM OF OPINION

ANNEX D: FORM OF WARRANT

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INDEX OF DEFINED TERMS

	 	 	 
	 	 	Location of
	Term	 	Definition
	Affiliate
	 	5.7(b)
	Agreement
	 	Recitals
	Appraisal Procedure
	 	4.9(c)(i)
	Appropriate Federal Banking Agency
	 	2.2(s)
	Bankruptcy Exceptions
	 	2.2(d)
	Benefit Plans
	 	1.2(d)(iv)
	Board of Directors
	 	2.2(f)
	Business Combination
	 	4.4
	business day
	 	1.3
	Capitalization Date
	 	2.2(b)
	Certificate of Designations
	 	1.2(d)(iii)
	Charter
	 	1.2(d)(iii)
	Closing
	 	1.2(a)
	Closing Date
	 	1.2(a)
	Code
	 	2.2(n)
	Common Stock
	 	Recitals
	Company
	 	Recitals
	Company Financial Statements
	 	2.2(h)
	Company Material Adverse Effect
	 	2.1(a)
	Company Reports
	 	2.2(i)(i)
	Company Subsidiary; Company Subsidiaries
	 	2.2(i)(i)
	control; controlled by; under common control with
	 	5.7(b)
	Controlled Group
	 	2.2(n)
	CPP
	 	Recitals
	EESA
	 	1.2(d)(iv)
	ERISA
	 	2.2(n)
	Exchange Act
	 	2.1(b)
	Fair Market Value
	 	4.9(c)(ii)
	GAAP
	 	2.1(a)
	Governmental Entities
	 	1.2(c)
	Holder
	 	4.5(k)(i)
	Holders’ Counsel
	 	4.5(k)(ii)
	Indemnitee
	 	4.5(g)(i)
	Information
	 	3.5(b)
	Initial Warrant Shares
	 	Recitals
	Investor
	 	Recitals
	Junior Stock
	 	4.8(c)
	knowledge of the Company; Company’s knowledge
	 	5.7(c)
	Last Fiscal Year
	 	2.1(b)
	Letter Agreement
	 	Recitals
	officers
	 	5.7(c)

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UST Sequence Number: 114

	 	 	 
	 	 	Location of
	Term	 	Definition
	Parity Stock
	 	4.8(c)
	Pending Underwritten Offering
	 	4.5(l)
	Permitted Repurchases
	 	4.8(a)(ii)
	Piggyback Registration
	 	4.5(a)(iv)
	Plan
	 	2.2(n)
	Preferred Shares
	 	Recitals
	Preferred Stock
	 	Recitals
	Previously Disclosed
	 	2.1(b)
	Proprietary Rights
	 	2.2(u)
	Purchase
	 	Recitals
	Purchase Price
	 	1.1
	Purchased Securities
	 	Recitals
	Qualified Equity Offering
	 	4.4
	register; registered; registration
	 	4.5(k)(iii)
	Registrable Securities
	 	4.5(k)(iv)
	Registration Expenses
	 	4.5(k)(v)
	Regulatory Agreement
	 	2.2(s)
	Rule 144; Rule 144A; Rule 159A; Rule 405; Rule 415
	 	4.5(k)(vi)
	Schedules
	 	Recitals
	SEC
	 	2.1(b)
	Securities Act
	 	2.2(a)
	Selling Expenses
	 	4.5(k)(vii)
	Senior Executive Officers
	 	4.10
	Share Dilution Amount
	 	4.8(a)(ii)
	Shelf Registration Statement
	 	4.5(a)(ii)
	Signing Date
	 	2.1(a)
	Special Registration
	 	4.5(i)
	Stockholder Proposals
	 	3.1(b)
	subsidiary
	 	5.8(a)
	Tax; Taxes
	 	2.2(o)
	Transfer 4
	 	.4
	Warrant
	 	Recitals
	Warrant Shares
	 	2.2(d)

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UST Sequence Number: 114

SECURITIES PURCHASE AGREEMENT – STANDARD TERMS

Recitals:

     WHEREAS, the United States Department of the Treasury (the “Investor”) may from time to time
agree to purchase shares of preferred stock and warrants from eligible financial institutions which
elect to participate in the Troubled Asset Relief Program Capital Purchase Program (“CPP”);

     WHEREAS, an eligible financial institution electing to participate in the CPP and issue
securities to the Investor (referred to herein as the “Company”) shall enter into a letter
agreement (the “Letter Agreement”) with the Investor which incorporates this Securities Purchase
Agreement – Standard Terms;

     WHEREAS, the Company agrees to expand the flow of credit to U.S. consumers and businesses on
competitive terms to promote the sustained growth and vitality of the U.S. economy;

     WHEREAS, the Company agrees to work diligently, under existing programs, to modify the terms
of residential mortgages as appropriate to strengthen the health of the U.S. housing market;

     WHEREAS, the Company intends to issue in a private placement the number of shares of the
series of its Preferred Stock (“Preferred Stock”) set forth on Schedule A to the Letter Agreement
(the “Preferred Shares”) and a warrant to purchase the number of shares of its Common Stock
(“Common Stock”) set forth on Schedule A to the Letter Agreement (the “Initial Warrant Shares”)
(the “Warrant” and, together with the Preferred Shares, the “Purchased Securities”) and the
Investor intends to purchase (the “Purchase”) from the Company the Purchased Securities; and

     WHEREAS, the Purchase will be governed by this Securities Purchase Agreement – Standard Terms
and the Letter Agreement, including the schedules thereto (the “Schedules”), specifying additional
terms of the Purchase. This Securities Purchase Agreement – Standard Terms (including the Annexes
hereto) and the Letter Agreement (including the Schedules thereto) are together referred to as this
“Agreement”. All references in this Securities Purchase Agreement – Standard Terms to “Schedules”
are to the Schedules attached to the Letter Agreement.

     NOW, THEREFORE, in consideration of the premises, and of the representations, warranties,
covenants and agreements set forth herein, the parties agree as follows:

Article I

Purchase; Closing

     1.1 Purchase. On the terms and subject to the conditions set forth in this Agreement,
the Company agrees to sell to the Investor, and the Investor agrees to purchase from the Company,
at the Closing (as hereinafter defined), the Purchased Securities for the price set forth on
Schedule A (the “Purchase Price”).

 

 

UST Sequence Number: 114

     1.2 Closing.

     (a) On the terms and subject to the conditions set forth in this Agreement, the closing of the
Purchase (the “Closing”) will take place at the location specified in Schedule A, at the time and
on the date set forth in Schedule A or as soon as practicable thereafter, or at such other place,
time and date as shall be agreed between the Company and the Investor. The time and date on which
the Closing occurs is referred to in this Agreement as the “Closing Date”.

     (b) Subject to the fulfillment or waiver of the conditions to the Closing in this Section 1.2,
at the Closing the Company will deliver the Preferred Shares and the Warrant, in each case as
evidenced by one or more certificates dated the Closing Date and bearing appropriate legends as
hereinafter provided for, in exchange for payment in full of the Purchase Price by wire transfer of
immediately available United States funds to a bank account designated by the Company on Schedule
A.

     (c) The respective obligations of each of the Investor and the Company to consummate the
Purchase are subject to the fulfillment (or waiver by the Investor and the Company, as applicable)
prior to the Closing of the conditions that (i) any approvals or authorizations of all United
States and other governmental, regulatory or judicial authorities (collectively, “Governmental
Entities”) required for the consummation of the Purchase shall have been obtained or made in form
and substance reasonably satisfactory to each party and shall be in full force and effect and all
waiting periods required by United States and other applicable law, if any, shall have expired and
(ii) no provision of any applicable United States or other law and no judgment, injunction, order
or decree of any Governmental Entity shall prohibit the purchase and sale of the Purchased
Securities as contemplated by this Agreement.

     (d) The obligation of the Investor to consummate the Purchase is also subject to the
fulfillment (or waiver by the Investor) at or prior to the Closing of each of the following
conditions:

     (i) (A) the representations and warranties of the Company set forth in (x) Section
2.2(g) of this Agreement shall be true and correct in all respects as though made on and as
of the Closing Date, (y) Sections 2.2(a) through (f) shall be true and correct in all
material respects as though made on and as of the Closing Date (other than representations
and warranties that by their terms speak as of another date, which representations and
warranties shall be true and correct in all material respects as of such other date) and (z)
Sections 2.2(h) through (v) (disregarding all qualifications or limitations set forth in
such representations and warranties as to “materiality”, “Company Material Adverse Effect”
and words of similar import) shall be true and correct as though made on and as of the
Closing Date (other than representations and warranties that by their terms speak as of
another date, which representations and warranties shall be true and correct as of such
other date), except to the extent that the failure of such representations and warranties
referred to in this Section 1.2(d)(i)(A)(z) to be so true and correct, individually or in
the aggregate, does not have and would not reasonably be expected to have a Company Material
Adverse Effect and (B) the Company shall have

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UST Sequence Number: 114

performed in all material respects all obligations required to be performed by it under this
Agreement at or prior to the Closing;

     (ii) the Investor shall have received a certificate signed on behalf of the Company by
a senior executive officer certifying to the effect that the conditions set forth in Section
1.2(d)(i) have been satisfied;

     (iii) the Company shall have duly adopted and filed with the Secretary of State of its
jurisdiction of organization or other applicable Governmental Entity the amendment to its
certificate or articles of incorporation, articles of association, or similar organizational
document (“Charter”) in substantially the form attached hereto as Annex A (the “Certificate
of Designations”) and such filing shall have been accepted;

     (iv) (A) the Company shall have effected such changes to its compensation, bonus,
incentive and other benefit plans, arrangements and agreements (including golden parachute,
severance and employment agreements) (collectively, “Benefit Plans”) with respect to its
Senior Executive Officers (and to the extent necessary for such changes to be legally
enforceable, each of its Senior Executive Officers shall have duly consented in writing to
such changes), as may be necessary, during the period that the Investor owns any debt or
equity securities of the Company acquired pursuant to this Agreement or the Warrant, in
order to comply with Section 111(b) of the Emergency Economic Stabilization Act of 2008
(“EESA”) as implemented by guidance or regulation thereunder that has been issued and is in
effect as of the Closing Date, and (B) the Investor shall have received a certificate signed
on behalf of the Company by a senior executive officer certifying to the effect that the
condition set forth in Section 1.2(d)(iv)(A) has been satisfied;

     (v) each of the Company’s Senior Executive Officers shall have delivered to the
Investor a written waiver in the form attached hereto as Annex B releasing the Investor from
any claims that such Senior Executive Officers may otherwise have as a result of the
issuance, on or prior to the Closing Date, of any regulations which require the modification
of, and the agreement of the Company hereunder to modify, the terms of any Benefit Plans
with respect to its Senior Executive Officers to eliminate any provisions of such Benefit
Plans that would not be in compliance with the requirements of Section 111(b) of the EESA as
implemented by guidance or regulation thereunder that has been issued and is in effect as of
the Closing Date;

     (vi) the Company shall have delivered to the Investor a written opinion from counsel to
the Company (which may be internal counsel), addressed to the Investor and dated as of the
Closing Date, in substantially the form attached hereto as Annex C;

     (vii) the Company shall have delivered certificates in proper form or, with the prior
consent of the Investor, evidence of shares in book-entry form, evidencing the Preferred
Shares to Investor or its designee(s); and

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UST Sequence Number: 114

     (viii) the Company shall have duly executed the Warrant in substantially the form
attached hereto as Annex D and delivered such executed Warrant to the Investor or its
designee(s).

     1.3 Interpretation. When a reference is made in this Agreement to “Recitals,”
“Articles,” “Sections,” or “Annexes” such reference shall be to a Recital, Article or Section of,
or Annex to, this Securities Purchase Agreement – Standard Terms, and a reference to “Schedules”
shall be to a Schedule to the Letter Agreement, in each case, unless otherwise indicated. The terms
defined in the singular have a comparable meaning when used in the plural, and vice versa.
References to “herein”, “hereof”, “hereunder” and the like refer to this Agreement as a whole and
not to any particular section or provision, unless the context requires otherwise. The table of
contents and headings contained in this Agreement are for reference purposes only and are not part
of this Agreement. Whenever the words “include,” “includes” or “including” are used in this
Agreement, they shall be deemed followed by the words “without limitation.” No rule of construction
against the draftsperson shall be applied in connection with the interpretation or enforcement of
this Agreement, as this Agreement is the product of negotiation between sophisticated parties
advised by counsel. All references to “$” or “dollars” mean the lawful currency of the United
States of America. Except as expressly stated in this Agreement, all references to any statute,
rule or regulation are to the statute, rule or regulation as amended, modified, supplemented or
replaced from time to time (and, in the case of statutes, include any rules and regulations
promulgated under the statute) and to any section of any statute, rule or regulation include any
successor to the section. References to a “business day” shall mean any day except Saturday, Sunday
and any day on which banking institutions in the State of New York generally are authorized or
required by law or other governmental actions to close.

Article II

Representations and Warranties

     2.1 Disclosure.

     (a) “Company Material Adverse Effect” means a material adverse effect on (i) the business,
results of operation or financial condition of the Company and its consolidated subsidiaries taken
as a whole; provided, however, that Company Material Adverse Effect shall not be deemed to include
the effects of (A) changes after the date of the Letter Agreement (the “Signing Date”) in general
business, economic or market conditions (including changes generally in prevailing interest rates,
credit availability and liquidity, currency exchange rates and price levels or trading volumes in
the United States or foreign securities or credit markets), or any outbreak or escalation of
hostilities, declared or undeclared acts of war or terrorism, in each case generally affecting the
industries in which the Company and its subsidiaries operate, (B) changes or proposed changes after
the Signing Date in generally accepted accounting principles in the United States (“GAAP”) or
regulatory accounting requirements, or authoritative interpretations thereof, (C) changes or
proposed changes after the Signing Date in securities, banking and other laws of general
applicability or related policies or interpretations of Governmental Entities (in the case of each
of these clauses (A), (B) and (C), other than changes

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or occurrences to the extent that such changes or occurrences have or would reasonably be expected
to have a materially disproportionate adverse effect on the Company and its consolidated
subsidiaries taken as a whole relative to comparable U.S. banking or financial services
organizations), or (D) changes in the market price or trading volume of the Common Stock or any
other equity, equity-related or debt securities of the Company or its consolidated subsidiaries (it
being understood and agreed that the exception set forth in this clause (D) does not apply to the
underlying reason giving rise to or contributing to any such change); or (ii) the ability of the
Company to consummate the Purchase and the other transactions contemplated by this Agreement and
the Warrant and perform its obligations hereunder or thereunder on a timely basis.

     (b) “Previously Disclosed” means information set forth or incorporated in the Company’s Annual
Report on Form 10-K for the most recently completed fiscal year of the Company filed with the
Securities and Exchange Commission (the “SEC”) prior to the Signing Date (the “Last Fiscal Year”)
or in its other reports and forms filed with or furnished to the SEC under Sections 13(a), 14(a) or
15(d) of the Securities Exchange Act of 1934 (the “Exchange Act”) on or after the last day of the
Last Fiscal Year and prior to the Signing Date.

     2.2 Representations and Warranties of the Company. Except as Previously Disclosed, the
Company represents and warrants to the Investor that as of the Signing Date and as of the Closing
Date (or such other date specified herein):

     (a) Organization, Authority and Significant Subsidiaries. The Company has been duly
incorporated and is validly existing and in good standing under the laws of its jurisdiction of
organization, with the necessary power and authority to own its properties and conduct its business
in all material respects as currently conducted, and except as has not, individually or in the
aggregate, had and would not reasonably be expected to have a Company Material Adverse Effect, has
been duly qualified as a foreign corporation for the transaction of business and is in good
standing under the laws of each other jurisdiction in which it owns or leases properties or
conducts any business so as to require such qualification; each subsidiary of the Company that is a
“significant subsidiary” within the meaning of Rule 1-02(w) of Regulation S-X under the Securities
Act of 1933 (the “Securities Act”) has been duly organized and is validly existing in good standing
under the laws of its jurisdiction of organization. The Charter and bylaws of the Company, copies
of which have been provided to the Investor prior to the Signing Date, are true, complete and
correct copies of such documents as in full force and effect as of the Signing Date.

     (b) Capitalization. The authorized capital stock of the Company, and the outstanding
capital stock of the Company (including securities convertible into, or exercisable or exchangeable
for, capital stock of the Company) as of the most recent fiscal month-end preceding the Signing
Date (the “Capitalization Date”) is set forth on Schedule B. The outstanding shares of
capital stock of the Company have been duly authorized and are validly issued and outstanding,
fully paid and nonassessable, and subject to no preemptive rights (and were not issued in violation
of any preemptive rights). Except as provided in the Warrant, as of the Signing Date, the Company
does not have outstanding any securities or other obligations providing the holder the right to
acquire Common Stock that is not reserved for issuance as

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specified on Schedule B, and the Company has not made any other commitment to authorize,
issue or sell any Common Stock. Since the Capitalization Date, the Company has not issued any
shares of Common Stock, other than (i) shares issued upon the exercise of stock options or
delivered under other equity-based awards or other convertible securities or warrants which were
issued and outstanding on the Capitalization Date and disclosed on Schedule B and (ii)
shares disclosed on Schedule B.

     (c) Preferred Shares. The Preferred Shares have been duly and validly authorized, and,
when issued and delivered pursuant to this Agreement, such Preferred Shares will be duly and
validly issued and fully paid and non-assessable, will not be issued in violation of any preemptive
rights, and will rank pari passu with or senior to all other series or classes of Preferred Stock,
whether or not issued or outstanding, with respect to the payment of dividends and the distribution
of assets in the event of any dissolution, liquidation or winding up of the Company.

     (d) The Warrant and Warrant Shares. The Warrant has been duly authorized and, when
executed and delivered as contemplated hereby, will constitute a valid and legally binding
obligation of the Company enforceable against the Company in accordance with its terms, except as
the same may be limited by applicable bankruptcy, insolvency, reorganization, moratorium or similar
laws affecting the enforcement of creditors’ rights generally and general equitable principles,
regardless of whether such enforceability is considered in a proceeding at law or in equity
(“Bankruptcy Exceptions”). The shares of Common Stock issuable upon exercise of the Warrant (the
“Warrant Shares”) have been duly authorized and reserved for issuance upon exercise of the Warrant
and when so issued in accordance with the terms of the Warrant will be validly issued, fully paid
and non-assessable, subject, if applicable, to the approvals of its stockholders set forth on
Schedule C.

     (e) Authorization, Enforceability.

     (i) The Company has the corporate power and authority to execute and deliver this
Agreement and the Warrant and, subject, if applicable, to the approvals of its stockholders
set forth on Schedule C, to carry out its obligations hereunder and thereunder (which
includes the issuance of the Preferred Shares, Warrant and Warrant Shares). The execution,
delivery and performance by the Company of this Agreement and the Warrant and the
consummation of the transactions contemplated hereby and thereby have been duly authorized
by all necessary corporate action on the part of the Company and its stockholders, and no
further approval or authorization is required on the part of the Company, subject, in each
case, if applicable, to the approvals of its stockholders set forth on Schedule C.
This Agreement is a valid and binding obligation of the Company enforceable against the
Company in accordance with its terms, subject to the Bankruptcy Exceptions.

     (ii) The execution, delivery and performance by the Company of this Agreement and the
Warrant and the consummation of the transactions contemplated hereby and thereby and
compliance by the Company with the provisions hereof and

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thereof, will not (A) violate, conflict with, or result in a breach of any provision of, or
constitute a default (or an event which, with notice or lapse of time or both, would
constitute a default) under, or result in the termination of, or accelerate the performance
required by, or result in a right of termination or acceleration of, or result in the
creation of, any lien, security interest, charge or encumbrance upon any of the properties
or assets of the Company or any Company Subsidiary under any of the terms, conditions or
provisions of (i) subject, if applicable, to the approvals of the Company’s stockholders set
forth on Schedule C, its organizational documents or (ii) any note, bond, mortgage,
indenture, deed of trust, license, lease, agreement or other instrument or obligation to
which the Company or any Company Subsidiary is a party or by which it or any Company
Subsidiary may be bound, or to which the Company or any Company Subsidiary or any of the
properties or assets of the Company or any Company Subsidiary may be subject, or (B) subject
to compliance with the statutes and regulations referred to in the next paragraph, violate
any statute, rule or regulation or any judgment, ruling, order, writ, injunction or decree
applicable to the Company or any Company Subsidiary or any of their respective properties or
assets except, in the case of clauses (A)(ii) and (B), for those occurrences that,
individually or in the aggregate, have not had and would not reasonably be expected to have
a Company Material Adverse Effect. (iii) Other than the filing of the Certificate of
Designations with the Secretary of State of its jurisdiction of organization or other
applicable Governmental Entity, any current report on Form 8-K required to be filed with the
SEC, such filings and approvals as are required to be made or obtained under any state “blue
sky” laws, the filing of any proxy statement contemplated by Section 3.1 and such as have
been made or obtained, no notice to, filing with, exemption or review by, or authorization,
consent or approval of, any Governmental Entity is required to be made or obtained by the
Company in connection with the consummation by the Company of the Purchase except for any
such notices, filings, exemptions, reviews, authorizations, consents and approvals the
failure of which to make or obtain would not, individually or in the aggregate, reasonably
be expected to have a Company Material Adverse Effect.

     (f) Anti-takeover Provisions and Rights Plan. The Board of Directors of the Company
(the “Board of Directors”) has taken all necessary action to ensure that the transactions
contemplated by this Agreement and the Warrant and the consummation of the transactions
contemplated hereby and thereby, including the exercise of the Warrant in accordance with its
terms, will be exempt from any anti-takeover or similar provisions of the Company’s Charter and
bylaws, and any other provisions of any applicable “moratorium”, “control share”, “fair price”,
“interested stockholder” or other anti-takeover laws and regulations of any jurisdiction. The
Company has taken all actions necessary to render any stockholders’ rights plan of the Company
inapplicable to this Agreement and the Warrant and the consummation of the transactions
contemplated hereby and thereby, including the exercise of the Warrant by the Investor in
accordance with its terms.

     (g) No Company Material Adverse Effect. Since the last day of the last completed
fiscal period for which the Company has filed a Quarterly Report on Form 10-Q or an

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Annual -8- Report on Form 10-K with the SEC prior to the Signing Date, no fact, circumstance, event, change,
occurrence, condition or development has occurred that, individually or in the aggregate, has had
or would reasonably be expected to have a Company Material Adverse Effect.

     (h) Company Financial Statements. Each of the consolidated financial statements of the
Company and its consolidated subsidiaries (collectively the “Company Financial Statements”)
included or incorporated by reference in the Company Reports filed with the SEC since December 31,
2006, present fairly in all material respects the consolidated financial position of the Company
and its consolidated subsidiaries as of the dates indicated therein (or if amended prior to the
Signing Date, as of the date of such amendment) and the consolidated results of their operations
for the periods specified therein; and except as stated therein, such financial statements (A) were
prepared in conformity with GAAP applied on a consistent basis (except as may be noted therein),
(B) have been prepared from, and are in accordance with, the books and records of the Company and
the Company Subsidiaries and (C) complied as to form, as of their respective dates of filing with
the SEC, in all material respects with the applicable accounting requirements and with the
published rules and regulations of the SEC with respect thereto.

     (i) Reports.

     (i) Since December 31, 2006, the Company and each subsidiary of the Company (each a
“Company Subsidiary” and, collectively, the “Company Subsidiaries”) has timely filed all
reports, registrations, documents, filings, statements and submissions, together with any
amendments thereto, that it was required to file with any Governmental Entity (the
foregoing, collectively, the “Company Reports”) and has paid all fees and assessments due
and payable in connection therewith, except, in each case, as would not, individually or in
the aggregate, reasonably be expected to have a Company Material Adverse Effect. As of their
respective dates of filing, the Company Reports complied in all material respects with all
statutes and applicable rules and regulations of the applicable Governmental Entities. In
the case of each such Company Report filed with or furnished to the SEC, such Company Report
(A) did not, as of its date or if amended prior to the Signing Date, as of the date of such
amendment, contain an untrue statement of a material fact or omit to state a material fact
necessary in order to make the statements made therein, in light of the circumstances under
which they were made, not misleading, and (B) complied as to form in all material respects
with the applicable requirements of the Securities Act and the Exchange Act. With respect to
all other Company Reports, the Company Reports were complete and accurate in all material
respects as of their respective dates. No executive officer of the Company or any Company
Subsidiary has failed in any respect to make the certifications required of him or her under
Section 302 or 906 of the Sarbanes-Oxley Act of 2002.

     (ii) The records, systems, controls, data and information of the Company and the
Company Subsidiaries are recorded, stored, maintained and operated under means (including
any electronic, mechanical or photographic process, whether computerized or not) that are
under the exclusive ownership and direct control of the Company or the

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Company Subsidiaries or their accountants (including all means of access thereto and
therefrom), except for any non-exclusive ownership and non-direct control that would not
reasonably be expected to have a material adverse effect on the system of internal
accounting controls described below in this Section 2.2(i)(ii). The Company (A) has
implemented and maintains disclosure controls and procedures (as defined in Rule 13a-15(e)
of the Exchange Act) to ensure that material information relating to the Company, including
the consolidated Company Subsidiaries, is made known to the chief executive officer and the
chief financial officer of the Company by others within those entities, and (B) has
disclosed, based on its most recent evaluation prior to the Signing Date, to the Company’s
outside auditors and the audit committee of the Board of Directors (x) any significant
deficiencies and material weaknesses in the design or operation of internal controls over
financial reporting (as defined in Rule 13a-15(f) of the Exchange Act) that are reasonably
likely to adversely affect the Company’s ability to record, process, summarize and report
financial information and (y) any fraud, whether or not material, that involves management
or other employees who have a significant role in the Company’s internal controls over
financial reporting.

     (j) No Undisclosed Liabilities. Neither the Company nor any of the Company
Subsidiaries has any liabilities or obligations of any nature (absolute, accrued, contingent or
otherwise) which are not properly reflected or reserved against in the Company Financial Statements
to the extent required to be so reflected or reserved against in accordance with GAAP, except for
(A) liabilities that have arisen since the last fiscal year end in the ordinary and usual course of
business and consistent with past practice and (B) liabilities that, individually or in the
aggregate, have not had and would not reasonably be expected to have a Company Material Adverse
Effect.

     (k) Offering of Securities. Neither the Company nor any person acting on its behalf
has taken any action (including any offering of any securities of the Company under circumstances
which would require the integration of such offering with the offering of any of the Purchased
Securities under the Securities Act, and the rules and regulations of the SEC promulgated
thereunder), which might subject the offering, issuance or sale of any of the Purchased Securities
to Investor pursuant to this Agreement to the registration requirements of the Securities Act.

     (l) Litigation and Other Proceedings. Except (i) as set forth on Schedule D or (ii) as
would not, individually or in the aggregate, reasonably be expected to have a Company Material
Adverse Effect, there is no (A) pending or, to the knowledge of the Company, threatened, claim,
action, suit, investigation or proceeding, against the Company or any Company Subsidiary or to
which any of their assets are subject nor is the Company or any Company Subsidiary subject to any
order, judgment or decree or (B) unresolved violation, criticism or exception by any Governmental
Entity with respect to any report or relating to any examinations or inspections of the Company or
any Company Subsidiaries.

     (m) Compliance with Laws. Except as would not, individually or in the aggregate,
reasonably be expected to have a Company Material Adverse Effect, the Company and the

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Company Subsidiaries have all permits, licenses, franchises, authorizations, orders and approvals
of, and have made all filings, applications and registrations with, Governmental Entities that are
required in order to permit them to own or lease their properties and assets and to carry on their
business as presently conducted and that are material to the business of the Company or such
Company Subsidiary. Except as set forth on Schedule E, the Company and the Company Subsidiaries
have complied in all respects and are not in default or violation of, and none of them is, to the
knowledge of the Company, under investigation with respect to or, to the knowledge of the Company,
have been threatened to be charged with or given notice of any violation of, any applicable
domestic (federal, state or local) or foreign law, statute, ordinance, license, rule, regulation,
policy or guideline, order, demand, writ, injunction, decree or judgment of any Governmental
Entity, other than such noncompliance, defaults or violations that would not, individually or in
the aggregate, reasonably be expected to have a Company Material Adverse Effect. Except for
statutory or regulatory restrictions of general application or as set forth on Schedule E, no
Governmental Entity has placed any restriction on the business or properties of the Company or any
Company Subsidiary that would, individually or in the aggregate, reasonably be expected to have a
Company Material Adverse Effect.

     (n) Employee Benefit Matters. Except as would not reasonably be expected to have,
either individually or in the aggregate, a Company Material Adverse Effect: (A) each “employee
benefit plan” (within the meaning of Section 3(3) of the Employee Retirement Income Security Act of
1974, as amended (“ERISA”)) providing benefits to any current or former employee, officer or
director of the Company or any member of its “Controlled Group” (defined as any organization which
is a member of a controlled group of corporations within the meaning of Section 414 of the Internal
Revenue Code of 1986, as amended (the “Code”)) that is sponsored, maintained or contributed to by
the Company or any member of its Controlled Group and for which the Company or any member of its
Controlled Group would have any liability, whether actual or contingent (each, a “Plan”) has been
maintained in compliance with its terms and with the requirements of all applicable statutes, rules
and regulations, including ERISA and the Code; (B) with respect to each Plan subject to Title IV of
ERISA (including, for purposes of this clause (B), any plan subject to Title IV of ERISA that the
Company or any member of its Controlled Group previously maintained or contributed to in the six
years prior to the Signing Date), (1) no “reportable event” (within the meaning of Section 4043(c)
of ERISA), other than a reportable event for which the notice period referred to in Section 4043(c)
of ERISA has been waived, has occurred in the three years prior to the Signing Date or is
reasonably expected to occur, (2) no “accumulated funding deficiency” (within the meaning of
Section 302 of ERISA or Section 412 of the Code), whether or not waived, has occurred in the three
years prior to the Signing Date or is reasonably expected to occur, (3) the fair market value of
the assets under each Plan exceeds the present value of all benefits accrued under such Plan
(determined based on the assumptions used to fund such Plan) and (4) neither the Company nor any
member of its Controlled Group has incurred in the six years prior to the Signing Date, or
reasonably expects to incur, any liability under Title IV of ERISA (other than contributions to the
Plan or premiums to the PBGC in the ordinary course and without default) in respect of a Plan
(including any Plan that is a “multiemployer plan”, within the meaning of Section 4001(c)(3) of
ERISA); and (C) each Plan that is intended to be qualified under Section 401(a) of the Code has
received a favorable

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determination letter from the Internal Revenue Service with respect to its qualified status that
has not been revoked, or such a determination letter has been timely applied for but not received
by the Signing Date, and nothing has occurred, whether by action or by failure to act, which could
reasonably be expected to cause the loss, revocation or denial of such qualified status or
favorable determination letter.

     (o) Taxes. Except as would not, individually or in the aggregate, reasonably be
expected to have a Company Material Adverse Effect, (i) the Company and the Company Subsidiaries
have filed all federal, state, local and foreign income and franchise Tax returns required to be
filed through the Signing Date, subject to permitted extensions, and have paid all Taxes due
thereon, and (ii) no Tax deficiency has been determined adversely to the Company or any of the
Company Subsidiaries, nor does the Company have any knowledge of any Tax deficiencies. “Tax” or
“Taxes” means any federal, state, local or foreign income, gross receipts, property, sales, use,
license, excise, franchise, employment, payroll, withholding, alternative or add on minimum, ad
valorem, transfer or excise tax, or any other tax, custom, duty, governmental fee or other like
assessment or charge of any kind whatsoever, together with any interest or penalty, imposed by any
Governmental Entity.

     (p) Properties and Leases. Except as would not, individually or in the aggregate,
reasonably be expected to have a Company Material Adverse Effect, the Company and the Company
Subsidiaries have good and marketable title to all real properties and all other properties and
assets owned by them, in each case free from liens, encumbrances, claims and defects that would
affect the value thereof or interfere with the use made or to be made thereof by them. Except as
would not, individually or in the aggregate, reasonably be expected to have a Company Material
Adverse Effect, the Company and the Company Subsidiaries hold all leased real or personal property
under valid and enforceable leases with no exceptions that would interfere with the use made or to
be made thereof by them.

     (q) Environmental Liability. Except as would not, individually or in the aggregate,
reasonably be expected to have a Company Material Adverse Effect:

     (i) there is no legal, administrative, or other proceeding, claim or action of any
nature seeking to impose, or that would reasonably be expected to result in the imposition
of, on the Company or any Company Subsidiary, any liability relating to the release of
hazardous substances as defined under any local, state or federal environmental statute,
regulation or ordinance, including the Comprehensive Environmental Response, Compensation
and Liability Act of 1980, pending or, to the Company’s knowledge, threatened against the
Company or any Company Subsidiary;

     (ii) to the Company’s knowledge, there is no reasonable basis for any such proceeding,
claim or action; and

     (iii) neither the Company nor any Company Subsidiary is subject to any agreement,
order, judgment or decree by or with any court, Governmental Entity or third party imposing
any such environmental liability.

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     (r) Risk Management Instruments. Except as would not, individually or in the
aggregate, reasonably be expected to have a Company Material Adverse Effect, all derivative
instruments, including, swaps, caps, floors and option agreements, whether entered into for the
Company’s own account, or for the account of one or more of the Company Subsidiaries or its or
their customers, were entered into (i) only in the ordinary course of business, (ii) in accordance
with prudent practices and in all material respects with all applicable laws, rules, regulations
and regulatory policies and (iii) with counterparties believed to be financially responsible at the
time; and each of such instruments constitutes the valid and legally binding obligation of the
Company or one of the Company Subsidiaries, enforceable in accordance with its terms, except as may
be limited by the Bankruptcy Exceptions. Neither the Company or the Company Subsidiaries, nor, to
the knowledge of the Company, any other party thereto, is in breach of any of its obligations under
any such agreement or arrangement other than such breaches that would not, individually or in the
aggregate, reasonably be expected to have a Company Material Adverse Effect.

     (s) Agreements with Regulatory Agencies. Except as set forth on Schedule F, neither
the Company nor any Company Subsidiary is subject to any material cease-and-desist or other similar
order or enforcement action issued by, or is a party to any material written agreement, consent
agreement or memorandum of understanding with, or is a party to any commitment letter or similar
undertaking to, or is subject to any capital directive by, or since December 31, 2006, has adopted
any board resolutions at the request of, any Governmental Entity (other than the Appropriate
Federal Banking Agencies with jurisdiction over the Company and the Company Subsidiaries) that
currently restricts in any material respect the conduct of its business or that in any material
manner relates to its capital adequacy, its liquidity and funding policies and practices, its
ability to pay dividends, its credit, risk management or compliance policies or procedures, its
internal controls, its management or its operations or business (each item in this sentence, a
“Regulatory Agreement”), nor has the Company or any Company Subsidiary been advised since December
31, 2006 by any such Governmental Entity that it is considering issuing, initiating, ordering, or
requesting any such Regulatory Agreement. The Company and each Company Subsidiary are in compliance
in all material respects with each Regulatory Agreement to which it is party or subject, and
neither the Company nor any Company Subsidiary has received any notice from any Governmental Entity
indicating that either the Company or any Company Subsidiary is not in compliance in all material
respects with any such Regulatory Agreement. “Appropriate Federal Banking Agency” means the
“appropriate Federal banking agency” with respect to the Company or such Company Subsidiaries, as
applicable, as defined in Section 3(q) of the Federal Deposit Insurance Act (12 U.S.C. Section
1813(q)).

     (t) Insurance. The Company and the Company Subsidiaries are insured with reputable
insurers against such risks and in such amounts as the management of the Company reasonably has
determined to be prudent and consistent with industry practice. The Company and the Company
Subsidiaries are in material compliance with their insurance policies and are not in default under
any of the material terms thereof, each such policy is outstanding and in full force and effect,
all premiums and other payments due under any material policy have been paid, and all claims
thereunder have been filed in due and timely fashion, except, in each case, as would not,
individually or in the aggregate, reasonably be expected to have a Company Material Adverse Effect.

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     (u) Intellectual Property. Except as would not, individually or in the aggregate,
reasonably be expected to have a Company Material Adverse Effect, (i) the Company and each Company
Subsidiary owns or otherwise has the right to use, all intellectual property rights, including all
trademarks, trade dress, trade names, service marks, domain names, patents, inventions, trade
secrets, know-how, works of authorship and copyrights therein, that are used in the conduct of
their existing businesses and all rights relating to the plans, design and specifications of any of
its branch facilities (“Proprietary Rights”) free and clear of all liens and any claims of
ownership by current or former employees, contractors, designers or others and (ii) neither the
Company nor any of the Company Subsidiaries is materially infringing, diluting, misappropriating or
violating, nor has the Company or any or the Company Subsidiaries received any written (or, to the
knowledge of the Company, oral) communications alleging that any of them has materially infringed,
diluted, misappropriated or violated, any of the Proprietary Rights owned by any other person.
Except as would not, individually or in the aggregate, reasonably be expected to have a Company
Material Adverse Effect, to the Company’s knowledge, no other person is infringing, diluting,
misappropriating or violating, nor has the Company or any or the Company Subsidiaries sent any
written communications since January 1, 2006 alleging that any person has infringed, diluted,
misappropriated or violated, any of the Proprietary Rights owned by the Company and the Company
Subsidiaries.

     (v) Brokers and Finders. No broker, finder or investment banker is entitled to any
financial advisory, brokerage, finder’s or other fee or commission in connection with this
Agreement or the Warrant or the transactions contemplated hereby or thereby based upon arrangements
made by or on behalf of the Company or any Company Subsidiary for which the Investor could have any
liability.

Article III

Covenants

     3.1 Commercially Reasonable Efforts.

     (a) Subject to the terms and conditions of this Agreement, each of the parties will use its
commercially reasonable efforts in good faith to take, or cause to be taken, all actions, and to
do, or cause to be done, all things necessary, proper or desirable, or advisable under applicable
laws, so as to permit consummation of the Purchase as promptly as practicable and otherwise to
enable consummation of the transactions contemplated hereby and shall use commercially reasonable
efforts to cooperate with the other party to that end.

     (b) If the Company is required to obtain any stockholder approvals set forth on Schedule
C, then the Company shall comply with this Section 3.1(b) and Section 3.1(c). The Company shall
call a special meeting of its stockholders, as promptly as practicable following the Closing, to
vote on proposals (collectively, the “Stockholder Proposals”) to (i) approve the exercise of the
Warrant for Common Stock for purposes of the rules of the national security exchange on which the
Common Stock is listed and/or (ii) amend the Company’s Charter to increase the number of authorized
shares of Common Stock to at least such number as shall be sufficient to permit the full exercise
of the Warrant for Common Stock and comply with the

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other provisions of this Section 3.1(b) and Section 3.1(c). The Board of Directors shall recommend
to the Company’s stockholders that such stockholders vote in favor of the Stockholder Proposals. In
connection with such meeting, the Company shall prepare (and the Investor will reasonably cooperate
with the Company to prepare) and file with the SEC as promptly as practicable (but in no event more
than ten business days after the Closing) a preliminary proxy statement, shall use its reasonable
best efforts to respond to any comments of the SEC or its staff thereon and to cause a definitive
proxy statement related to such stockholders’ meeting to be mailed to the Company’s stockholders
not more than five business days after clearance thereof by the SEC, and shall use its reasonable
best efforts to solicit proxies for such stockholder approval of the Stockholder Proposals. The
Company shall notify the Investor promptly of the receipt of any comments from the SEC or its staff
with respect to the proxy statement and of any request by the SEC or its staff for amendments or
supplements to such proxy statement or for additional information and will supply the Investor with
copies of all correspondence between the Company or any of its representatives, on the one hand,
and the SEC or its staff, on the other hand, with respect to such proxy statement. If at any time
prior to such stockholders’ meeting there shall occur any event that is required to be set forth in
an amendment or supplement to the proxy statement, the Company shall as promptly as practicable
prepare and mail to its stockholders such an amendment or supplement. Each of the Investor and the
Company agrees promptly to correct any information provided by it or on its behalf for use in the
proxy statement if and to the extent that such information shall have become false or misleading in
any material respect, and the Company shall as promptly as practicable prepare and mail to its
stockholders an amendment or supplement to correct such information to the extent required by
applicable laws and regulations. The Company shall consult with the Investor prior to filing any
proxy statement, or any amendment or supplement thereto, and provide the Investor with a reasonable
opportunity to comment thereon. In the event that the approval of any of the Stockholder Proposals
is not obtained at such special stockholders meeting, the Company shall include a proposal to
approve (and the Board of Directors shall recommend approval of) each such proposal at a meeting of
its stockholders no less than once in each subsequent six-month period beginning on January 1, 2009
until all such approvals are obtained or made.

     (c) None of the information supplied by the Company or any of the Company Subsidiaries for
inclusion in any proxy statement in connection with any such stockholders meeting of the Company
will, at the date it is filed with the SEC, when first mailed to the Company’s stockholders and at
the time of any stockholders meeting, and at the time of any amendment or supplement thereof,
contain any untrue statement of a material fact or omit to state any material fact necessary in
order to make the statements therein, in light of the circumstances under which they are made, not
misleading.

     3.2 Expenses. Unless otherwise provided in this Agreement or the Warrant, each of the
parties hereto will bear and pay all costs and expenses incurred by it or on its behalf in
connection with the transactions contemplated under this Agreement and the Warrant, including fees
and expenses of its own financial or other consultants, investment bankers, accountants and
counsel.

     3.3 Sufficiency of Authorized Common Stock; Exchange Listing.

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     (a) During the period from the Closing Date (or, if the approval of the Stockholder Proposals
is required, the date of such approval) until the date on which the Warrant has been fully
exercised, the Company shall at all times have reserved for issuance, free of preemptive or similar
rights, a sufficient number of authorized and unissued Warrant Shares to effectuate such exercise.
Nothing in this Section 3.3 shall preclude the Company from satisfying its obligations in respect
of the exercise of the Warrant by delivery of shares of Common Stock which are held in the treasury
of the Company. As soon as reasonably practicable following the Closing, the Company shall, at its
expense, cause the Warrant Shares to be listed on the same national securities exchange on which
the Common Stock is listed, subject to official notice of issuance, and shall maintain such listing
for so long as any Common Stock is listed on such exchange.

     (b) If requested by the Investor, the Company shall promptly use its reasonable best efforts
to cause the Preferred Shares to be approved for listing on a national securities exchange as
promptly as practicable following such request.

     3.4 Certain Notifications Until Closing. From the Signing Date until the Closing, the
Company shall promptly notify the Investor of (i) any fact, event or circumstance of which it is
aware and which would reasonably be expected to cause any representation or warranty of the Company
contained in this Agreement to be untrue or inaccurate in any material respect or to cause any
covenant or agreement of the Company contained in this Agreement not to be complied with or
satisfied in any material respect and (ii) except as Previously Disclosed, any fact, circumstance,
event, change, occurrence, condition or development of which the Company is aware and which,
individually or in the aggregate, has had or would reasonably be expected to have a Company
Material Adverse Effect; provided, however, that delivery of any notice pursuant to this Section
3.4 shall not limit or affect any rights of or remedies available to the Investor; provided,
further, that a failure to comply with this Section 3.4 shall not constitute a breach of this
Agreement or the failure of any condition set forth in Section 1.2 to be satisfied unless the
underlying Company Material Adverse Effect or material breach would independently result in the
failure of a condition set forth in Section 1.2 to be satisfied.

     3.5 Access, Information and Confidentiality.

     (a) From the Signing Date until the date when the Investor holds an amount of Preferred Shares
having an aggregate liquidation value of less than 10% of the Purchase Price, the Company will
permit the Investor and its agents, consultants, contractors and advisors (x) acting through the
Appropriate Federal Banking Agency, to examine the corporate books and make copies thereof and to
discuss the affairs, finances and accounts of the Company and the Company Subsidiaries with the
principal officers of the Company, all upon reasonable notice and at such reasonable times and as
often as the Investor may reasonably request and (y) to review any information material to the
Investor’s investment in the Company provided by the Company to its Appropriate Federal Banking
Agency. Any investigation pursuant to this Section 3.5 shall be conducted during normal business
hours and in such manner as not to interfere unreasonably with the conduct of the business of the
Company, and nothing herein shall require the Company or any Company Subsidiary to disclose any
information to the Investor to the extent (i) prohibited by applicable law or regulation, or (ii)
that such disclosure would reasonably be

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expected to cause a violation of any agreement to which the Company or any Company Subsidiary is a
party or would cause a risk of a loss of privilege to the Company or any Company Subsidiary
(provided that the Company shall use commercially reasonable efforts to make appropriate substitute
disclosure arrangements under circumstances where the restrictions in this clause (ii) apply).

     (b) The Investor will use reasonable best efforts to hold, and will use reasonable best
efforts to cause its agents, consultants, contractors and advisors to hold, in confidence all
nonpublic records, books, contracts, instruments, computer data and other data and information
(collectively, “Information”) concerning the Company furnished or made available to it by the
Company or its representatives pursuant to this Agreement (except to the extent that such
information can be shown to have been (i) previously known by such party on a non-confidential
basis, (ii) in the public domain through no fault of such party or (iii) later lawfully acquired
from other sources by the party to which it was furnished (and without violation of any other
confidentiality obligation)); provided that nothing herein shall prevent the Investor from
disclosing any Information to the extent required by applicable laws or regulations or by any
subpoena or similar legal process.

Article IV

Additional Agreements

     4.1 Purchase for Investment. The Investor acknowledges that the Purchased Securities
and the Warrant Shares have not been registered under the Securities Act or under any state
securities laws. The Investor (a) is acquiring the Purchased Securities pursuant to an exemption
from registration under the Securities Act solely for investment with no present intention to
distribute them to any person in violation of the Securities Act or any applicable U.S. state
securities laws, (b) will not sell or otherwise dispose of any of the Purchased Securities or the
Warrant Shares, except in compliance with the registration requirements or exemption provisions of
the Securities Act and any applicable U.S. state securities laws, and (c) has such knowledge and
experience in financial and business matters and in investments of this type that it is capable of
evaluating the merits and risks of the Purchase and of making an informed investment decision.

     4.2 Legends.

     (a) The Investor agrees that all certificates or other instruments representing the Warrant
and the Warrant Shares will bear a legend substantially to the following effect:

“THE SECURITIES REPRESENTED BY THIS INSTRUMENT HAVE NOT BEEN REGISTERED UNDER THE SECURITIES
ACT OF 1933, AS AMENDED, OR THE SECURITIES LAWS OF ANY STATE AND MAY NOT BE TRANSFERRED,
SOLD OR OTHERWISE DISPOSED OF EXCEPT WHILE A REGISTRATION STATEMENT RELATING THERETO IS IN
EFFECT UNDER SUCH ACT AND APPLICABLE STATE SECURITIES LAWS OR PURSUANT TO AN EXEMPTION FROM
REGISTRATION UNDER SUCH ACT OR SUCH LAWS.”

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     (b) The Investor agrees that all certificates or other instruments representing the Warrant
will also bear a legend substantially to the following effect:

“THIS INSTRUMENT IS ISSUED SUBJECT TO THE RESTRICTIONS ON TRANSFER AND OTHER PROVISIONS OF A
SECURITIES PURCHASE AGREEMENT BETWEEN THE ISSUER OF THESE SECURITIES AND THE INVESTOR
REFERRED TO THEREIN, A COPY OF WHICH IS ON FILE WITH THE ISSUER. THE SECURITIES REPRESENTED
BY THIS INSTRUMENT MAY NOT BE SOLD OR OTHERWISE TRANSFERRED EXCEPT IN COMPLIANCE WITH SAID
AGREEMENT. ANY SALE OR OTHER TRANSFER NOT IN COMPLIANCE WITH SAID AGREEMENT WILL BE VOID.”

     (c) In addition, the Investor agrees that all certificates or other instruments representing
the Preferred Shares will bear a legend substantially to the following effect:

“THE SECURITIES REPRESENTED BY THIS INSTRUMENT ARE NOT SAVINGS ACCOUNTS, DEPOSITS OR OTHER
OBLIGATIONS OF A BANK AND ARE NOT INSURED BY THE FEDERAL DEPOSIT INSURANCE CORPORATION OR
ANY OTHER GOVERNMENTAL AGENCY. THE SECURITIES REPRESENTED BY THIS INSTRUMENT HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), OR THE
SECURITIES LAWS OF ANY STATE AND MAY NOT BE TRANSFERRED, SOLD OR OTHERWISE DISPOSED OF
EXCEPT WHILE A REGISTRATION STATEMENT RELATING THERETO IS IN EFFECT UNDER SUCH ACT AND
APPLICABLE STATE SECURITIES LAWS OR PURSUANT TO AN EXEMPTION FROM REGISTRATION UNDER SUCH
ACT OR SUCH LAWS. EACH PURCHASER OF THE SECURITIES REPRESENTED BY THIS INSTRUMENT IS
NOTIFIED THAT THE SELLER MAY BE RELYING ON THE EXEMPTION FROM SECTION 5 OF THE SECURITIES
ACT PROVIDED BY RULE 144A THEREUNDER. ANY TRANSFEREE OF THE SECURITIES REPRESENTED BY THIS
INSTRUMENT BY ITS ACCEPTANCE HEREOF (1) REPRESENTS THAT IT IS A “QUALIFIED INSTITUTIONAL
BUYER” (AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT), (2) AGREES THAT IT WILL NOT
OFFER, SELL OR OTHERWISE TRANSFER THE SECURITIES REPRESENTED BY THIS INSTRUMENT EXCEPT (A)
PURSUANT TO A REGISTRATION STATEMENT WHICH IS THEN EFFECTIVE UNDER THE SECURITIES ACT, (B)
FOR SO LONG AS THE SECURITIES REPRESENTED BY THIS INSTRUMENT ARE ELIGIBLE FOR RESALE
PURSUANT TO RULE 144A, TO A PERSON IT REASONABLY BELIEVES IS A “QUALIFIED INSTITUTIONAL
BUYER” AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT THAT PURCHASES FOR ITS OWN ACCOUNT
OR FOR THE ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER TO WHOM NOTICE IS GIVEN THAT THE
TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A, (C) TO THE ISSUER OR (D) PURSUANT TO ANY
OTHER AVAILABLE EXEMPTION FROM THE REGISTRATION

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REQUIREMENTS OF THE SECURITIES ACT AND (3) AGREES THAT IT WILL GIVE TO EACH PERSON TO WHOM
THE SECURITIES REPRESENTED BY THIS INSTRUMENT ARE TRANSFERRED A NOTICE SUBSTANTIALLY TO THE
EFFECT OF THIS LEGEND.”

     (d) In the event that any Purchased Securities or Warrant Shares (i) become registered under
the Securities Act or (ii) are eligible to be transferred without restriction in accordance with
Rule 144 or another exemption from registration under the Securities Act (other than Rule 144A),
the Company shall issue new certificates or other instruments representing such Purchased
Securities or Warrant Shares, which shall not contain the applicable legends in Sections 4.2(a) and
(c) above; provided that the Investor surrenders to the Company the previously issued certificates
or other instruments. Upon Transfer of all or a portion of the Warrant in compliance with Section
4.4, the Company shall issue new certificates or other instruments representing the Warrant, which
shall not contain the applicable legend in Section 4.2(b) above; provided that the Investor
surrenders to the Company the previously issued certificates or other instruments.

     4.3 Certain Transactions. The Company will not merge or consolidate with, or sell,
transfer or lease all or substantially all of its property or assets to, any other party unless the
successor, transferee or lessee party (or its ultimate parent entity), as the case may be (if not
the Company), expressly assumes the due and punctual performance and observance of each and every
covenant, agreement and condition of this Agreement to be performed and observed by the Company.

     4.4 Transfer of Purchased Securities and Warrant Shares; Restrictions on Exercise of the
Warrant. Subject to compliance with applicable securities laws, the Investor shall be permitted
to transfer, sell, assign or otherwise dispose of (“Transfer”) all or a portion of the Purchased
Securities or Warrant Shares at any time, and the Company shall take all steps as may be reasonably
requested by the Investor to facilitate the Transfer of the Purchased Securities and the Warrant
Shares; provided that the Investor shall not Transfer a portion or portions of the Warrant with
respect to, and/or exercise the Warrant for, more than one-half of the Initial Warrant Shares (as
such number may be adjusted from time to time pursuant to Section 13 thereof) in the aggregate
until the earlier of (a) the date on which the Company (or any successor by Business Combination)
has received aggregate gross proceeds of not less than the Purchase Price (and the purchase price
paid by the Investor to any such successor for securities of such successor purchased under the
CPP) from one or more Qualified Equity Offerings (including Qualified Equity Offerings of such
successor) and (b) December 31, 2009. “Qualified Equity Offering” means the sale and issuance for
cash by the Company to persons other than the Company or any of the Company Subsidiaries after the
Closing Date of shares of perpetual Preferred Stock, Common Stock or any combination of such stock,
that, in each case, qualify as and may be included in Tier 1 capital of the Company at the time of
issuance under the applicable risk-based capital guidelines of the Company’s Appropriate Federal
Banking Agency (other than any such sales and issuances made pursuant to agreements or arrangements
entered into, or pursuant to financing plans which were publicly announced, on or prior to October
13,

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2008). “Business Combination” means a merger, consolidation, statutory share exchange or similar
transaction that requires the approval of the Company’s stockholders.

     4.5 Registration Rights.

     (a) Registration.

     (i) Subject to the terms and conditions of this Agreement, the Company covenants and
agrees that as promptly as practicable after the Closing Date (and in any event no later
than 30 days after the Closing Date), the Company shall prepare and file with the SEC a
Shelf Registration Statement covering all Registrable Securities (or otherwise designate an
existing Shelf Registration Statement filed with the SEC to cover the Registrable
Securities), and, to the extent the Shelf Registration Statement has not theretofore been
declared effective or is not automatically effective upon such filing, the Company shall use
reasonable best efforts to cause such Shelf Registration Statement to be declared or become
effective and to keep such Shelf Registration Statement continuously effective and in
compliance with the Securities Act and usable for resale of such Registrable Securities for
a period from the date of its initial effectiveness until such time as there are no
Registrable Securities remaining (including by refiling such Shelf Registration Statement
(or a new Shelf Registration Statement) if the initial Shelf Registration Statement
expires). So long as the Company is a well-known seasoned issuer (as defined in Rule 405
under the Securities Act) at the time of filing of the Shelf Registration Statement with the
SEC, such Shelf Registration Statement shall be designated by the Company as an automatic
Shelf Registration Statement. Notwithstanding the foregoing, if on the Signing Date the
Company is not eligible to file a registration statement on Form S-3, then the Company shall
not be obligated to file a Shelf Registration Statement unless and until requested to do so
in writing by the Investor.

     (ii) Any registration pursuant to Section 4.5(a)(i) shall be effected by means of a
shelf registration on an appropriate form under Rule 415 under the Securities Act (a “Shelf
Registration Statement”). If the Investor or any other Holder intends to distribute any
Registrable Securities by means of an underwritten offering it shall promptly so advise the
Company and the Company shall take all reasonable steps to facilitate such distribution,
including the actions required pursuant to Section 4.5(c); provided that the Company shall
not be required to facilitate an underwritten offering of Registrable Securities unless the
expected gross proceeds from such offering exceed (i) 2% of the initial aggregate
liquidation preference of the Preferred Shares if such initial aggregate liquidation
preference is less than $2 billion and (ii) $200 million if the initial aggregate
liquidation preference of the Preferred Shares is equal to or greater than $2 billion. The
lead underwriters in any such distribution shall be selected by the Holders of a majority of
the Registrable Securities to be distributed; provided that to the extent appropriate and
permitted under applicable law, such Holders shall consider the qualifications of any
broker-dealer Affiliate of the Company in selecting the lead underwriters in any such
distribution.

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     (iii) The Company shall not be required to effect a registration (including a resale of
Registrable Securities from an effective Shelf Registration Statement) or an underwritten
offering pursuant to Section 4.5(a): (A) with respect to securities that are not Registrable
Securities; or (B) if the Company has notified the Investor and all other Holders that in
the good faith judgment of the Board of Directors, it would be materially detrimental to the
Company or its securityholders for such registration or underwritten offering to be effected
at such time, in which event the Company shall have the right to defer such registration for
a period of not more than 45 days after receipt of the request of the Investor or any other
Holder; provided that such right to delay a registration or underwritten offering shall be
exercised by the Company (1) only if the Company has generally exercised (or is concurrently
exercising) similar black-out rights against holders of similar securities that have
registration rights and (2) not more than three times in any 12-month period and not more
than 90 days in the aggregate in any 12-month period.

     (iv) If during any period when an effective Shelf Registration Statement is not
available, the Company proposes to register any of its equity securities, other than a
registration pursuant to Section 4.5(a)(i) or a Special Registration, and the registration
form to be filed may be used for the registration or qualification for distribution of
Registrable Securities, the Company will give prompt written notice to the Investor and all
other Holders of its intention to effect such a registration (but in no event less than ten
days prior to the anticipated filing date) and will include in such registration all
Registrable Securities with respect to which the Company has received written requests for
inclusion therein within ten business days after the date of the Company’s notice (a
“Piggyback Registration”). Any such person that has made such a written request may withdraw
its Registrable Securities from such Piggyback Registration by giving written notice to the
Company and the managing underwriter, if any, on or before the fifth business day prior to
the planned effective date of such Piggyback Registration. The Company may terminate or
withdraw any registration under this Section 4.5(a)(iv) prior to the effectiveness of such
registration, whether or not Investor or any other Holders have elected to include
Registrable Securities in such registration.

     (v) If the registration referred to in Section 4.5(a)(iv) is proposed to be
underwritten, the Company will so advise Investor and all other Holders as a part of the
written notice given pursuant to Section 4.5(a)(iv). In such event, the right of Investor
and all other Holders to registration pursuant to Section 4.5(a) will be conditioned upon
such persons’ participation in such underwriting and the inclusion of such person’s
Registrable Securities in the underwriting if such securities are of the same class of
securities as the securities to be offered in the underwritten offering, and each such
person will (together with the Company and the other persons distributing their securities
through such underwriting) enter into an underwriting agreement in customary form with the
underwriter or underwriters selected for such underwriting by the Company; provided that the
Investor (as opposed to other Holders) shall not be required to indemnify any person in
connection with any registration. If any participating person disapproves of the terms of
the underwriting, such person may elect to withdraw therefrom by written notice

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to the Company, the managing underwriters and the Investor (if the Investor is participating
in the underwriting).

     (vi) If either (x) the Company grants “piggyback” registration rights to one or more
third parties to include their securities in an underwritten offering under the Shelf
Registration Statement pursuant to Section 4.5(a)(ii) or (y) a Piggyback Registration under
Section 4.5(a)(iv) relates to an underwritten offering on behalf of the Company, and in
either case the managing underwriters advise the Company that in their reasonable opinion
the number of securities requested to be included in such offering exceeds the number which
can be sold without adversely affecting the marketability of such offering (including an
adverse effect on the per share offering price), the Company will include in such offering
only such number of securities that in the reasonable opinion of such managing underwriters
can be sold without adversely affecting the marketability of the offering (including an
adverse effect on the per share offering price), which securities will be so included in the
following order of priority: (A) first, in the case of a Piggyback Registration under
Section 4.5(a)(iv), the securities the Company proposes to sell, (B) then the Registrable
Securities of the Investor and all other Holders who have requested inclusion of Registrable
Securities pursuant to Section 4.5(a)(ii) or Section 4.5(a)(iv), as applicable, pro rata on
the basis of the aggregate number of such securities or shares owned by each such person and
(C) lastly, any other securities of the Company that have been requested to be so included,
subject to the terms of this Agreement; provided, however, that if the Company has, prior to
the Signing Date, entered into an agreement with respect to its securities that is
inconsistent with the order of priority contemplated hereby then it shall apply the order of
priority in such conflicting agreement to the extent that it would otherwise result in a
breach under such agreement.

     (b) Expenses of Registration. All Registration Expenses incurred in connection with
any registration, qualification or compliance hereunder shall be borne by the Company. All Selling
Expenses incurred in connection with any registrations hereunder shall be borne by the holders of
the securities so registered pro rata on the basis of the aggregate offering or sale price of the
securities so registered.

     (c) Obligations of the Company. The Company shall use its reasonable best efforts, for
so long as there are Registrable Securities outstanding, to take such actions as are under its
control to not become an ineligible issuer (as defined in Rule 405 under the Securities Act) and to
remain a well-known seasoned issuer (as defined in Rule 405 under the Securities Act) if it has
such status on the Signing Date or becomes eligible for such status in the future. In addition,
whenever required to effect the registration of any Registrable Securities or facilitate the
distribution of Registrable Securities pursuant to an effective Shelf Registration Statement, the
Company shall, as expeditiously as reasonably practicable:

     (i) Prepare and file with the SEC a prospectus supplement with respect to a proposed
offering of Registrable Securities pursuant to an effective registration statement, subject
to Section 4.5(d), keep such registration statement effective and keep

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     such prospectus supplement current until the securities described therein are no longer
Registrable Securities.

     (ii) Prepare and file with the SEC such amendments and supplements to the applicable
registration statement and the prospectus or prospectus supplement used in connection with
such registration statement as may be necessary to comply with the provisions of the
Securities Act with respect to the disposition of all securities covered by such
registration statement.

     (iii) Furnish to the Holders and any underwriters such number of copies of the
applicable registration statement and each such amendment and supplement thereto (including
in each case all exhibits) and of a prospectus, including a preliminary prospectus, in
conformity with the requirements of the Securities Act, and such other documents as they may
reasonably request in order to facilitate the disposition of Registrable Securities owned or
to be distributed by them.

     (iv) Use its reasonable best efforts to register and qualify the securities covered by
such registration statement under such other securities or Blue Sky laws of such
jurisdictions as shall be reasonably requested by the Holders or any managing
underwriter(s), to keep such registration or qualification in effect for so long as such
registration statement remains in effect, and to take any other action which may be
reasonably necessary to enable such seller to consummate the disposition in such
jurisdictions of the securities owned by such Holder; provided that the Company shall not be
required in connection therewith or as a condition thereto to qualify to do business or to
file a general consent to service of process in any such states or jurisdictions.

     (v) Notify each Holder of Registrable Securities at any time when a prospectus relating
thereto is required to be delivered under the Securities Act of the happening of any event
as a result of which the applicable prospectus, as then in effect, includes an untrue
statement of a material fact or omits to state a material fact required to be stated therein
or necessary to make the statements therein not misleading in light of the circumstances
then existing.

     (vi) Give written notice to the Holders:

     (A) when any registration statement filed pursuant to Section 4.5(a) or any
amendment thereto has been filed with the SEC (except for any amendment effected by
the filing of a document with the SEC pursuant to the Exchange Act) and when such
registration statement or any post-effective amendment thereto has become effective;

     (B) of any request by the SEC for amendments or supplements to any registration
statement or the prospectus included therein or for additional information;

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     (C) of the issuance by the SEC of any stop order suspending the effectiveness
of any registration statement or the initiation of any proceedings for that purpose;

     (D) of the receipt by the Company or its legal counsel of any notification with
respect to the suspension of the qualification of the Common Stock for sale in any
jurisdiction or the initiation or threatening of any proceeding for such purpose;

     (E) of the happening of any event that requires the Company to make changes in
any effective registration statement or the prospectus related to the registration
statement in order to make the statements therein not misleading (which notice shall
be accompanied by an instruction to suspend the use of the prospectus until the
requisite changes have been made); and

     (F) if at any time the representations and warranties of the Company contained
in any underwriting agreement contemplated by Section 4.5(c)(x) cease to be true and
correct.

     (vii) Use its reasonable best efforts to prevent the issuance or obtain the withdrawal
of any order suspending the effectiveness of any registration statement referred to in
Section 4.5(c)(vi)(C) at the earliest practicable time.

     (viii) Upon the occurrence of any event contemplated by Section 4.5(c)(v) or
4.5(c)(vi)(E), promptly prepare a post-effective amendment to such registration statement or
a supplement to the related prospectus or file any other required document so that, as
thereafter delivered to the Holders and any underwriters, the 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. If the Company notifies the Holders in accordance with Section 4.5(c)(vi)(E) to
suspend the use of the prospectus until the requisite changes to the prospectus have been
made, then the Holders and any underwriters shall suspend use of such prospectus and use
their reasonable best efforts to return to the Company all copies of such prospectus (at the
Company’s expense) other than permanent file copies then in such Holders’ or underwriters’
possession. The total number of days that any such suspension may be in effect in any
12-month period shall not exceed 90 days.

     (ix) Use reasonable best efforts to procure the cooperation of the Company’s transfer
agent in settling any offering or sale of Registrable Securities, including with respect to
the transfer of physical stock certificates into book-entry form in accordance with any
procedures reasonably requested by the Holders or any managing underwriter(s).

     (x) If an underwritten offering is requested pursuant to Section 4.5(a)(ii), enter into
an underwriting agreement in customary form, scope and substance and take all such

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other actions reasonably requested by the Holders of a majority of the Registrable
Securities being sold in connection therewith or by the managing underwriter(s), if any, to
expedite or facilitate the underwritten disposition of such Registrable Securities, and in
connection therewith in any underwritten offering (including making members of management
and executives of the Company available to participate in “road shows”, similar sales events
and other marketing activities), (A) make such representations and warranties to the Holders
that are selling stockholders and the managing underwriter(s), if any, with respect to the
business of the Company and its subsidiaries, and the Shelf Registration Statement,
prospectus and documents, if any, incorporated or deemed to be incorporated by reference
therein, in each case, in customary form, substance and scope, and, if true, confirm the
same if and when requested, (B) use its reasonable best efforts to furnish the underwriters
with opinions of counsel to the Company, addressed to the managing underwriter(s), if any,
covering the matters customarily covered in such opinions requested in underwritten
offerings, (C) use its reasonable best efforts to obtain “cold comfort” letters from the
independent certified public accountants of the Company (and, if necessary, any other
independent certified public accountants of any business acquired by the Company for which
financial statements and financial data are included in the Shelf Registration Statement)
who have certified the financial statements included in such Shelf Registration Statement,
addressed to each of the managing underwriter(s), if any, such letters to be in customary
form and covering matters of the type customarily covered in “cold comfort” letters, (D) if
an underwriting agreement is entered into, the same shall contain indemnification provisions
and procedures customary in underwritten offerings (provided that the Investor shall not be
obligated to provide any indemnity), and (E) deliver such documents and certificates as may
be reasonably requested by the Holders of a majority of the Registrable Securities being
sold in connection therewith, their counsel and the managing underwriter(s), if any, to
evidence the continued validity of the representations and warranties made pursuant to
clause (i) above and to evidence compliance with any customary conditions contained in the
underwriting agreement or other agreement entered into by the Company.

     (xi) Make available for inspection by a representative of Holders that are selling
stockholders, the managing underwriter(s), if any, and any attorneys or accountants retained
by such Holders or managing underwriter(s), at the offices where normally kept, during
reasonable business hours, financial and other records, pertinent corporate documents and
properties of the Company, and cause the officers, directors and employees of the Company to
supply all information in each case reasonably requested (and of the type customarily
provided in connection with due diligence conducted in connection with a registered public
offering of securities) by any such representative, managing underwriter(s), attorney or
accountant in connection with such Shelf Registration Statement.

     (xii) Use reasonable best efforts to cause all such Registrable Securities to be listed
on each national securities exchange on which similar securities issued by the Company are
then listed or, if no similar securities issued by the Company are then listed on any
national securities exchange, use its reasonable best efforts to cause all such

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Registrable Securities to be listed on such securities exchange as the Investor may
designate.

     (xiii) If requested by Holders of a majority of the Registrable Securities being
registered and/or sold in connection therewith, or the managing underwriter(s), if any,
promptly include in a prospectus supplement or amendment such information as the Holders of
a majority of the Registrable Securities being registered and/or sold in connection
therewith or managing underwriter(s), if any, may reasonably request in order to permit the
intended method of distribution of such securities and make all required filings of such
prospectus supplement or such amendment as soon as practicable after the Company has
received such request.

     (xiv) Timely provide to its security holders earning statements satisfying the
provisions of Section 11(a) of the Securities Act and Rule 158 thereunder.

     (d) Suspension of Sales. Upon receipt of written notice from the Company that a
registration statement, prospectus or prospectus supplement contains or may contain an untrue
statement of a material fact or omits or may omit to state a material fact required to be stated
therein or necessary to make the statements therein not misleading or that circumstances exist that
make inadvisable use of such registration statement, prospectus or prospectus supplement, the
Investor and each Holder of Registrable Securities shall forthwith discontinue disposition of
Registrable Securities until the Investor and/or Holder has received copies of a supplemented or
amended prospectus or prospectus supplement, or until the Investor and/or such Holder is advised in
writing by the Company that the use of the prospectus and, if applicable, prospectus supplement may
be resumed, and, if so directed by the Company, the Investor and/or such Holder shall deliver to
the Company (at the Company’s expense) all copies, other than permanent file copies then in the
Investor and/or such Holder’s possession, of the prospectus and, if applicable, prospectus
supplement covering such Registrable Securities current at the time of receipt of such notice. The
total number of days that any such suspension may be in effect in any 12-month period shall not
exceed 90 days.

     (e) Termination of Registration Rights. A Holder’s registration rights as to any
securities held by such Holder (and its Affiliates, partners, members and former members) shall not
be available unless such securities are Registrable Securities.

     (f) Furnishing Information.

     (i) Neither the Investor nor any Holder shall use any free writing prospectus (as
defined in Rule 405) in connection with the sale of Registrable Securities without the prior
written consent of the Company.

     (ii) It shall be a condition precedent to the obligations of the Company to take any
action pursuant to Section 4.5(c) that Investor and/or the selling Holders and the
underwriters, if any, shall furnish to the Company such information regarding themselves,
the Registrable Securities held by them and the intended method of

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disposition of such securities as shall be required to effect the registered offering of their
Registrable Securities.

     (g) Indemnification.

     (i) The Company agrees to indemnify each Holder and, if a Holder is a person other than
an individual, such Holder’s officers, directors, employees, agents, representatives and
Affiliates, and each Person, if any, that controls a Holder within the meaning of the
Securities Act (each, an “Indemnitee”), against any and all losses, claims, damages,
actions, liabilities, costs and expenses (including reasonable fees, expenses and
disbursements of attorneys and other professionals incurred in connection with
investigating, defending, settling, compromising or paying any such losses, claims, damages,
actions, liabilities, costs and expenses), joint or several, arising out of or based upon
any untrue statement or alleged untrue statement of material fact contained in any
registration statement, including any preliminary prospectus or final prospectus contained
therein or any amendments or supplements thereto or any documents incorporated therein by
reference or contained in any free writing prospectus (as such term is defined in Rule 405)
prepared by the Company or authorized by it in writing for use by such Holder (or any
amendment or supplement thereto); or any omission to state therein a material fact required
to be stated therein or necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading; provided, that the Company shall
not be liable to such Indemnitee in any such case to the extent that any such loss, claim,
damage, liability (or action or proceeding in respect thereof) or expense arises out of or
is based upon (A) an untrue statement or omission made in such registration statement,
including any such preliminary prospectus or final prospectus contained therein or any such
amendments or supplements thereto or contained in any free writing prospectus (as such term
is defined in Rule 405) prepared by the Company or authorized by it in writing for use by
such Holder (or any amendment or supplement thereto), in reliance upon and in conformity
with information regarding such Indemnitee or its plan of distribution or ownership
interests which was furnished in writing to the Company by such Indemnitee for use in
connection with such registration statement, including any such preliminary prospectus or
final prospectus contained therein or any such amendments or supplements thereto, or (B)
offers or sales effected by or on behalf of such Indemnitee “by means of” (as defined in
Rule 159A) a “free writing prospectus” (as defined in Rule 405) that was not authorized in
writing by the Company.

     (ii) If the indemnification provided for in Section 4.5(g)(i) is unavailable to an
Indemnitee with respect to any losses, claims, damages, actions, liabilities, costs or
expenses referred to therein or is insufficient to hold the Indemnitee harmless as
contemplated therein, then the Company, in lieu of indemnifying such Indemnitee, shall
contribute to the amount paid or payable by such Indemnitee as a result of such losses,
claims, damages, actions, liabilities, costs or expenses in such proportion as is
appropriate to reflect the relative fault of the Indemnitee, on the one hand, and the
Company, on the other hand, in connection with the statements or omissions which resulted in
such losses, claims, damages, actions, liabilities, costs or expenses as well as any other
relevant

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equitable considerations. The relative fault of the Company, on the one hand, and of the
Indemnitee, on the other hand, shall be determined by reference to, among other factors, whether
the untrue statement of a material fact or omission to state a material fact relates to information
supplied by the Company or by the Indemnitee and the parties’ relative intent, knowledge, access to
information and opportunity to correct or prevent such statement or omission; the Company and each
Holder agree that it would not be just and equitable if contribution pursuant to this Section
4.5(g)(ii) were determined by pro rata allocation or by any other method of allocation that does
not take account of the equitable considerations referred to in Section 4.5(g)(i). No Indemnitee
guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the Securities Act)
shall be entitled to contribution from the Company if the Company was not guilty of such fraudulent
misrepresentation.

     (h) Assignment of Registration Rights. The rights of the Investor to registration of
Registrable Securities pursuant to Section 4.5(a) may be assigned by the Investor to a transferee
or assignee of Registrable Securities with a liquidation preference or, in the case of Registrable
Securities other than Preferred Shares, a market value, no less than an amount equal to (i) 2% of
the initial aggregate liquidation preference of the Preferred Shares if such initial aggregate
liquidation preference is less than $2 billion and (ii) $200 million if the initial aggregate
liquidation preference of the Preferred Shares is equal to or greater than $2 billion; provided,
however, the transferor shall, within ten days after such transfer, furnish to the Company written
notice of the name and address of such transferee or assignee and the number and type of
Registrable Securities that are being assigned. For purposes of this Section 4.5(h), “market value”
per share of Common Stock shall be the last reported sale price of the Common Stock on the national
securities exchange on which the Common Stock is listed or admitted to trading on the last trading
day prior to the proposed transfer, and the “market value” for the Warrant (or any portion thereof)
shall be the market value per share of Common Stock into which the Warrant (or such portion) is
exercisable less the exercise price per share.

     (i) Clear Market. With respect to any underwritten offering of Registrable Securities
by the Investor or other Holders pursuant to this Section 4.5, the Company agrees not to effect
(other than pursuant to such registration or pursuant to a Special Registration) any public sale or
distribution, or to file any Shelf Registration Statement (other than such registration or a
Special Registration) covering, in the case of an underwritten offering of Common Stock or
Warrants, any of its equity securities or, in the case of an underwritten offering of Preferred
Shares, any Preferred Stock of the Company, or, in each case, any securities convertible into or
exchangeable or exercisable for such securities, during the period not to exceed ten days prior and
60 days following the effective date of such offering or such longer period up to 90 days as may be
requested by the managing underwriter for such underwritten offering. The Company also agrees to
cause such of its directors and senior executive officers to execute and deliver customary lock-up
agreements in such form and for such time period up to 90 days as may be requested by the managing
underwriter. “Special Registration” means the registration of (A) equity securities and/or options
or other rights in respect thereof solely registered on Form S-4 or Form S-8 (or successor form) or
(B) shares of equity securities and/or options or other rights in respect thereof to be offered to
directors, members of management, employees, consultants,

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customers, lenders or vendors of the Company or Company Subsidiaries or in connection with dividend
reinvestment plans.

     (j) Rule 144; Rule 144A. With a view to making available to the Investor and Holders
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:

     (i) make and keep public information available, as those terms are understood and
defined in Rule 144(c)(1) or any similar or analogous rule promulgated under the Securities
Act, at all times after the Signing Date;

     (ii) (A) file with the SEC, in a timely manner, all reports and other documents
required of the Company under the Exchange Act, and (B) if at any time the Company is not
required to file such reports, make available, upon the request of any Holder, such
information necessary to permit sales pursuant to Rule 144A (including the information
required by Rule 144A(d)(4) under the Securities Act);

     (iii) so long as the Investor or a Holder owns any Registrable Securities, furnish to
the Investor or such Holder forthwith upon request: a written statement by the Company as to
its compliance with the reporting requirements of Rule 144 under the Securities Act, and of
the Exchange Act; a copy of the most recent annual or quarterly report of the Company; and
such other reports and documents as the Investor or Holder may reasonably request in
availing itself of any rule or regulation of the SEC allowing it to sell any such securities
to the public without registration; and

     (iv) take such further action as any Holder may reasonably request, all to the extent
required from time to time to enable such Holder to sell Registrable Securities without
registration under the Securities Act.

     (k) As used in this Section 4.5, the following terms shall have the following respective
meanings:

(i) “Holder” means the Investor and any other holder of Registrable Securities to
whom the registration rights conferred by this Agreement have been transferred in
compliance with Section 4.5(h) hereof.

(ii) “Holders’ Counsel” means one counsel for the selling Holders chosen by Holders
holding a majority interest in the Registrable Securities being registered.

(iii) “Register,” “registered,” and “registration” shall refer to a registration
effected by preparing and (A) filing a registration statement in compliance with the
Securities Act and applicable rules and regulations thereunder, and the declaration
or ordering of effectiveness of such registration statement or (B) filing a
prospectus and/or

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     prospectus supplement in respect of an appropriate effective registration statement
on Form S-3.

     (iv) “Registrable Securities” means (A) all Preferred Shares, (B) the Warrant (subject
to Section 4.5(p)) and (C) any equity securities issued or issuable directly or indirectly
with respect to the securities referred to in the foregoing clauses (A) or (B) by way of
conversion, exercise or exchange thereof, including the Warrant Shares, or share dividend or
share split or in connection with a combination of shares, recapitalization,
reclassification, merger, amalgamation, arrangement, consolidation or other reorganization,
provided that, once issued, such securities will not be Registrable Securities when (1) they
are sold pursuant to an effective registration statement under the Securities Act, (2)
except as provided below in Section 4.5(o), they may be sold pursuant to Rule 144 without
limitation thereunder on volume or manner of sale, (3) they shall have ceased to be
outstanding or (4) they have been sold in a private transaction in which the transferor’s
rights under this Agreement are not assigned to the transferee of the securities. No
Registrable Securities may be registered under more than one registration statement at any
one time.

     (v) “Registration Expenses” mean all expenses incurred by the Company in effecting any
registration pursuant to this Agreement (whether or not any registration or prospectus
becomes effective or final) or otherwise complying with its obligations under this Section
4.5, including all registration, filing and listing fees, printing expenses, fees and
disbursements of counsel for the Company, blue sky fees and expenses, expenses incurred in
connection with any “road show”, the reasonable fees and disbursements of Holders’ Counsel,
and expenses of the Company’s independent accountants in connection with any regular or
special reviews or audits incident to or required by any such registration, but shall not
include Selling Expenses.

     (vi) “Rule 144”, “Rule 144A”, “Rule 159A”, “Rule 405” and “Rule 415” mean, in each
case, such rule promulgated under the Securities Act (or any successor provision), as the
same shall be amended from time to time.

     (vii) “Selling Expenses” mean all discounts, selling commissions and stock transfer
taxes applicable to the sale of Registrable Securities and fees and disbursements of counsel
for any Holder (other than the fees and disbursements of Holders’ Counsel included in
Registration Expenses).

     (l) At any time, any holder of Securities (including any Holder) may elect to forfeit its
rights set forth in this Section 4.5 from that date forward; provided, that a Holder forfeiting
such rights shall nonetheless be entitled to participate under Section 4.5(a)(iv) – (vi) in any
Pending Underwritten Offering to the same extent that such Holder would have been entitled to if
the holder had not withdrawn; and provided, further, that no such forfeiture shall terminate a
Holder’s rights or obligations under Section 4.5(f) with respect to any prior registration or
Pending Underwritten Offering. “Pending Underwritten Offering” means, with respect to any Holder
forfeiting its rights pursuant to this Section 4.5(l), any underwritten offering of

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Registrable Securities in which such Holder has advised the Company of its intent to register its
Registrable Securities either pursuant to Section 4.5(a)(ii) or 4.5(a)(iv) prior to the date of
such
Holder’s forfeiture.

     (m) Specific Performance. The parties hereto acknowledge that there would be no
adequate remedy at law if the Company fails to perform any of its obligations under this Section
4.5 and that the Investor and the Holders from time to time may be irreparably harmed by any such
failure, and accordingly agree that the Investor and such Holders, in addition to any other remedy
to which they may be entitled at law or in equity, to the fullest extent permitted and enforceable
under applicable law shall be entitled to compel specific performance of the obligations of the
Company under this Section 4.5 in accordance with the terms and conditions of this Section 4.5.

     (n) No Inconsistent Agreements. The Company shall not, on or after the Signing Date,
enter into any agreement with respect to its securities that may impair the rights granted to the
Investor and the Holders under this Section 4.5 or that otherwise conflicts with the provisions
hereof in any manner that may impair the rights granted to the Investor and the Holders under this
Section 4.5. In the event the Company has, prior to the Signing Date, entered into any agreement
with respect to its securities that is inconsistent with the rights granted to the Investor and the
Holders under this Section 4.5 (including agreements that are inconsistent with the order of
priority contemplated by Section 4.5(a)(vi)) or that may otherwise conflict with the provisions
hereof, the Company shall use its reasonable best efforts to amend such agreements to ensure they
are consistent with the provisions of this Section 4.5.

     (o) Certain Offerings by the Investor. In the case of any securities held by the
Investor that cease to be Registrable Securities solely by reason of clause (2) in the definition
of “Registrable Securities,” the provisions of Sections 4.5(a)(ii), clauses (iv), (ix) and
(x)-(xii) of Section 4.5(c), Section 4.5(g) and Section 4.5(i) shall continue to apply until such
securities otherwise cease to be Registrable Securities. In any such case, an “underwritten”
offering or other disposition shall include any distribution of such securities on behalf of the
Investor by one or more broker-dealers, an “underwriting agreement” shall include any purchase
agreement entered into by such broker-dealers, and any “registration statement” or “prospectus”
shall include any offering document approved by the Company and used in connection with such
distribution.

     (p) Registered Sales of the Warrant. The Holders agree to sell the Warrant or any
portion thereof under the Shelf Registration Statement only beginning 30 days after notifying the
Company of any such sale, during which 30-day period the Investor and all Holders of the Warrant
shall take reasonable steps to agree to revisions to the Warrant to permit a public distribution of
the Warrant, including entering into a warrant agreement and appointing a warrant agent.

     4.6 Voting of Warrant Shares. Notwithstanding anything in this Agreement to the
contrary, the Investor shall not exercise any voting rights with respect to the Warrant Shares.

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     4.7 Depositary Shares. Upon request by the Investor at any time following the Closing
Date, the Company shall promptly enter into a depositary arrangement, pursuant to customary
agreements reasonably satisfactory to the Investor and with a depositary reasonably acceptable to
the Investor, pursuant to which the Preferred Shares may be deposited and depositary shares, each
representing a fraction of a Preferred Share as specified by the Investor, may be issued. From and
after the execution of any such depositary arrangement, and the deposit of any Preferred Shares
pursuant thereto, the depositary shares issued pursuant thereto shall be deemed “Preferred Shares”
and, as applicable, “Registrable Securities” for purposes of this Agreement.

     4.8 Restriction on Dividends and Repurchases.

     (a) Prior to the earlier of (x) the third anniversary of the Closing Date and (y) the date on
which the Preferred Shares have been redeemed in whole or the Investor has transferred all of the
Preferred Shares to third parties which are not Affiliates of the Investor, neither the Company nor
any Company Subsidiary shall, without the consent of the Investor:

     (i) declare or pay any dividend or make any distribution on the Common Stock (other
than (A) regular quarterly cash dividends of not more than the amount of the last quarterly
cash dividend per share declared or, if lower, publicly announced an intention to declare,
on the Common Stock prior to October 14, 2008, as adjusted for any stock split, stock
dividend, reverse stock split, reclassification or similar transaction, (B) dividends
payable solely in shares of Common Stock and (C) dividends or distributions of rights or
Junior Stock in connection with a stockholders’ rights plan); or

     (ii) redeem, purchase or acquire any shares of Common Stock or other capital stock or
other equity securities of any kind of the Company, or any trust preferred securities issued
by the Company or any Affiliate of the Company, other than (A) redemptions, purchases or
other acquisitions of the Preferred Shares, (B) redemptions, purchases or other acquisitions
of shares of Common Stock or other Junior Stock, in each case in this clause (B) in
connection with the administration of any employee benefit plan in the ordinary course of
business (including purchases to offset the Share Dilution Amount (as defined below)
pursuant to a publicly announced repurchase plan) and consistent with past practice;
provided that any purchases to offset the Share Dilution Amount shall in no event exceed the
Share Dilution Amount, (C) purchases or other acquisitions by a broker-dealer subsidiary of
the Company solely for the purpose of market-making, stabilization or customer facilitation
transactions in Junior Stock or Parity Stock in the ordinary course of its business, (D)
purchases by a broker-dealer subsidiary of the Company of capital stock of the Company for
resale pursuant to an offering by the Company of such capital stock underwritten by such
broker-dealer subsidiary, (E) any redemption or repurchase of rights pursuant to any
stockholders’ rights plan, (F) the acquisition by the Company or any of the Company
Subsidiaries of record ownership in Junior Stock or Parity Stock for the beneficial
ownership of any other persons (other than the Company or any other Company Subsidiary),
including as trustees or custodians, and (G) the exchange or conversion of Junior Stock for
or into

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other Junior Stock or of Parity Stock or trust preferred securities for or into other Parity
Stock (with the same or lesser aggregate liquidation amount) or Junior Stock, in each case
set forth in this clause (G), solely to the extent required pursuant to binding contractual
agreements entered into prior to the Signing Date or any subsequent agreement for the
accelerated exercise, settlement or exchange thereof for Common Stock (clauses (C) and (F),
collectively, the “Permitted Repurchases”). “Share Dilution Amount” means the increase in
the number of diluted shares outstanding (determined in accordance with GAAP, and as
measured from the date of the Company’s most recently filed Company Financial Statements
prior to the Closing Date) resulting from the grant, vesting or exercise of equity-based
compensation to employees and equitably adjusted for any stock split, stock dividend,
reverse stock split, reclassification or similar transaction.

     (b) Until such time as the Investor ceases to own any Preferred Shares, the Company shall not
repurchase any Preferred Shares from any holder thereof, whether by means of open market purchase,
negotiated transaction, or otherwise, other than Permitted Repurchases, unless it offers to
repurchase a ratable portion of the Preferred Shares then held by the Investor on the same terms
and conditions.

     (c) “Junior Stock” means Common Stock and any other class or series of stock of the Company
the terms of which expressly provide that it ranks junior to the Preferred Shares as to dividend
rights and/or as to rights on liquidation, dissolution or winding up of the Company. “Parity Stock”
means any class or series of stock of the Company the terms of which do not expressly provide that
such class or series will rank senior or junior to the Preferred Shares as to dividend rights
and/or as to rights on liquidation, dissolution or winding up of the Company (in each case without
regard to whether dividends accrue cumulatively or non-cumulatively).

     4.9 Repurchase of Investor Securities.

     (a) Following the redemption in whole of the Preferred Shares held by the Investor or the
Transfer by the Investor of all of the Preferred Shares to one or more third parties not affiliated
with the Investor, the Company may repurchase, in whole or in part, at any time any other equity
securities of the Company purchased by the Investor pursuant to this Agreement or the Warrant and
then held by the Investor, upon notice given as provided in clause (b) below, at the Fair Market
Value of the equity security.

     (b) Notice of every repurchase of equity securities of the Company held by the Investor shall
be given at the address and in the manner set forth for such party in Section 5.6. Each notice of
repurchase given to the Investor shall state: (i) the number and type of securities to be
repurchased, (ii) the Board of Director’s determination of Fair Market Value of such securities and
(iii) the place or places where certificates representing such securities are to be surrendered for
payment of the repurchase price. The repurchase of the securities specified in the notice shall
occur as soon as practicable following the determination of the Fair Market Value of the
securities.

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     (c) As used in this Section 4.9, the following terms shall have the following respective
meanings:

     (i) “Appraisal Procedure” means a procedure whereby two independent appraisers, one
chosen by the Company and one by the Investor, shall mutually agree upon the Fair Market
Value. Each party shall deliver a notice to the other appointing its appraiser within 10
days after the Appraisal Procedure is invoked. If within 30 days after appointment of the
two appraisers they are unable to agree upon the Fair Market Value, a third independent
appraiser shall be chosen within 10 days thereafter by the mutual consent of such first two
appraisers. The decision of the third appraiser so appointed and chosen shall be given
within 30 days after the selection of such third appraiser. If three appraisers shall be
appointed and the determination of one appraiser is disparate from the middle determination
by more than twice the amount by which the other determination is disparate from the middle
determination, then the determination of such appraiser shall be excluded, the remaining two
determinations shall be averaged and such average shall be binding and conclusive upon the
Company and the Investor; otherwise, the average of all three determinations shall be
binding upon the Company and the Investor. The costs of conducting any Appraisal Procedure
shall be borne by the Company.

     (ii) “Fair Market Value” means, with respect to any security, the fair market value of
such security as determined by the Board of Directors, acting in good faith in reliance on
an opinion of a nationally recognized independent investment banking firm retained by the
Company for this purpose and certified in a resolution to the Investor. If the Investor does
not agree with the Board of Director’s determination, it may object in writing within 10
days of receipt of the Board of Director’s determination. In the event of such an objection,
an authorized representative of the Investor and the chief executive officer of the Company
shall promptly meet to resolve the objection and to agree upon the Fair Market Value. If the
chief executive officer and the authorized representative are unable to agree on the Fair
Market Value during the 10-day period following the delivery of the Investor’s objection,
the Appraisal Procedure may be invoked by either party to determine the Fair Market Value by
delivery of a written notification thereof not later than the 30th day after delivery of the
Investor’s objection.

     4.10 Executive Compensation. Until such time as the Investor ceases to own any debt or
equity securities of the Company acquired pursuant to this Agreement or the Warrant, the Company
shall take all necessary action to ensure that its Benefit Plans with respect to its Senior
Executive Officers comply in all respects with Section 111(b) of the EESA as implemented by any
guidance or regulation thereunder that has been issued and is in effect as of the Closing Date, and
shall not adopt any new Benefit Plan with respect to its Senior Executive Officers that does not
comply therewith. “Senior Executive Officers” means the Company’s “senior executive officers” as
defined in subsection 111(b)(3) of the EESA and regulations issued thereunder, including the rules
set forth in 31 C.F.R. Part 30.

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Article V

Miscellaneous

     5.1 Termination. This Agreement may be terminated at any time prior to the Closing:

     (a) by either the Investor or the Company if the Closing shall not have occurred by the 30th
calendar day following the Signing Date; provided, however, that in the event the Closing has not
occurred by such 30th calendar day, the parties will consult in good faith to determine whether to
extend the term of this Agreement, it being understood that the parties shall be required to
consult only until the fifth day after such 30th calendar day and not be under any obligation to
extend the term of this Agreement thereafter; provided, further, that the right to terminate this
Agreement under this Section 5.1(a) shall not be available to any party whose breach of any
representation or warranty or failure to perform any obligation under this Agreement shall have
caused or resulted in the failure of the Closing to occur on or prior to such date; or

     (b) by either the Investor or the Company in the event that any Governmental Entity shall have
issued an order, decree or ruling or taken any other action restraining, enjoining or otherwise
prohibiting the transactions contemplated by this Agreement and such order, decree, ruling or other
action shall have become final and nonappealable; or

     (c) by the mutual written consent of the Investor and the Company. In the event of termination
of this Agreement as provided in this Section 5.1, this Agreement shall forthwith become void and
there shall be no liability on the part of either party hereto except that nothing herein shall
relieve either party from liability for any breach of this Agreement.

     5.2 Survival of Representations and Warranties. All covenants and agreements, other
than those which by their terms apply in whole or in part after the Closing, shall terminate as of
the Closing. The representations and warranties of the Company made herein or in any certificates
delivered in connection with the Closing shall survive the Closing without limitation.

     5.3 Amendment. No amendment of any provision of this Agreement will be effective
unless made in writing and signed by an officer or a duly authorized representative of each party;
provided that the Investor may unilaterally amend any provision of this Agreement to the extent
required to comply with any changes after the Signing Date in applicable federal statutes. No
failure or delay by any party in exercising any right, power or privilege hereunder shall operate
as a waiver thereof nor shall any single or partial exercise thereof preclude any other or further
exercise of any other right, power or privilege. The rights and remedies herein provided shall be
cumulative of any rights or remedies provided by law.

     5.4 Waiver of Conditions. The conditions to each party’s obligation to consummate the
Purchase are for the sole benefit of such party and may be waived by such party in whole or in part
to the extent permitted by applicable law. No waiver will be effective unless it is in a

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writing signed by a duly authorized officer of the waiving party that makes express reference to
the provision or provisions subject to such waiver.

     5.5 Governing Law: Submission to Jurisdiction, Etc. This Agreement will be governed by
and construed in accordance with the federal law of the United States if and to the extent such law
is applicable, and otherwise in accordance with the laws of the State of New York applicable to
contracts made and to be performed entirely within such State. Each of the parties hereto agrees
(a) to submit to the exclusive jurisdiction and venue of the United States District Court for the
District of Columbia and the United States Court of Federal Claims for any and all civil actions,
suits or proceedings arising out of or relating to this Agreement or the Warrant or the
transactions contemplated hereby or thereby, and (b) that notice may be served upon (i) the Company
at the address and in the manner set forth for notices to the Company in Section 5.6 and (ii) the
Investor in accordance with federal law. To the extent permitted by applicable law, each of the
parties hereto hereby unconditionally waives trial by jury in any civil legal action or proceeding
relating to this Agreement or the Warrant or the transactions contemplated hereby or thereby.

     5.6 Notices. Any notice, request, instruction or other document to be given hereunder
by any party to the other will be in writing and will be deemed to have been duly given (a) on the
date of delivery if delivered personally, or by facsimile, upon confirmation of receipt, or (b) on
the second business day following the date of dispatch if delivered by a recognized next day
courier service. All notices to the Company shall be delivered as set forth in Schedule A, or
pursuant to such other instruction as may be designated in writing by the Company to the Investor.
All notices to the Investor shall be delivered as set forth below, or pursuant to such other
instructions as may be designated in writing by the Investor to the Company.

If to the Investor:

United States Department of the Treasury

1500 Pennsylvania Avenue, NW, Room 2312

Washington, D.C. 20220

Attention: Assistant General Counsel (Banking and Finance)

Facsimile: (202) 622-1974

     5.7 Definitions

     (a) When a reference is made in this Agreement to a subsidiary of a person, the term
“subsidiary” means any corporation, partnership, joint venture, limited liability company or other
entity (x) of which such person or a subsidiary of such person is a general partner or (y) of which
a majority of the voting securities or other voting interests, or a majority of the securities or
other interests of which having by their terms ordinary voting power to elect a majority of the
board of directors or persons performing similar functions with respect to such entity, is directly
or indirectly owned by such person and/or one or more subsidiaries thereof.

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     (b) The term “Affiliate” means, with respect to any person, any person directly or indirectly
controlling, controlled by or under common control with, such other person. For purposes of this
definition, “control” (including, with correlative meanings, the terms “controlled by” and “under
common control with”) when used with respect to any person, means the possession, directly or
indirectly, of the power to cause the direction of management and/or policies of such person,
whether through the ownership of voting securities by contract or otherwise.

     (c) The terms “knowledge of the Company” or “Company’s knowledge” mean the actual knowledge
after reasonable and due inquiry of the “officers” (as such term is defined in Rule 3b-2 under the
Exchange Act, but excluding any Vice President or Secretary) of the Company.

     5.8 Assignment. Neither this Agreement nor any right, remedy, obligation nor liability
arising hereunder or by reason hereof shall be assignable by any party hereto without the prior
written consent of the other party, and any attempt to assign any right, remedy, obligation or
liability hereunder without such consent shall be void, except (a) an assignment, in the case of a
Business Combination where such party is not the surviving entity, or a sale of substantially all
of its assets, to the entity which is the survivor of such Business Combination or the purchaser in
such sale and (b) as provided in Section 4.5.

     5.9 Severability. If any provision of this Agreement or the Warrant, or the
application thereof to any person or circumstance, is determined by a court of competent
jurisdiction to be invalid, void or unenforceable, the remaining provisions hereof, or the
application of such provision to persons or circumstances other than those as to which it has been
held invalid or unenforceable, will remain in full force and effect and shall in no way be
affected, impaired or invalidated thereby, so long as the economic or legal substance of the
transactions contemplated hereby is not affected in any manner materially adverse to any party.
Upon such determination, the parties shall negotiate in good faith in an effort to agree upon a
suitable and equitable substitute provision to effect the original intent of the parties.

     5.10 No Third Party Beneficiaries. Nothing contained in this Agreement, expressed or
implied, is intended to confer upon any person or entity other than the Company and the Investor
any benefit, right or remedies, except that the provisions of Section 4.5 shall inure to the
benefit of the persons referred to in that Section.

* * *

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ANNEX A

FORM OF CERTIFICATE OF DESIGNATIONS

[SEE ATTACHED]

 

 

UST Sequence Number: 114

ANNEX A

CERTIFICATE OF DESIGNATIONS

OF

FIXED RATE CUMULATIVE PERPETUAL PREFERRED STOCK, SERIES [•]

OF

[•]

     [Insert name of Corporation], a [corporation] organized and existing under the laws of the
[Insert jurisdiction of organization] (the “Corporation”), in accordance with the provisions of
Section[s] [•] of the [Insert applicable statute] thereof, does hereby certify:

     The board of directors of the Corporation (the “Board of Directors”) or an applicable
committee of the Board of Directors, in accordance with the [certificate of incorporation and
bylaws] of the Corporation and applicable law, adopted the following resolution on [•] creating a
series of [•] shares of Preferred Stock of the Corporation designated as “Fixed Rate Cumulative
Perpetual Preferred Stock, Series [•]”.

     RESOLVED, that pursuant to the provisions of the [certificate of incorporation and the bylaws]
of the Corporation and applicable law, a series of Preferred Stock, par value $[•] per share, of
the Corporation be and hereby is created, and that the designation and number of shares of such
series, and the voting and other powers, preferences and relative, participating, optional or other
rights, and the qualifications, limitations and restrictions thereof, of the shares of such series,
are as follows:

     Part 1. Designation and Number of Shares. There is hereby created out of the
authorized and unissued shares of preferred stock of the Corporation a series of preferred stock
designated as the “Fixed Rate Cumulative Perpetual Preferred Stock, Series [•]” (the “Designated
Preferred Stock”). The authorized number of shares of Designated Preferred Stock shall be [•].

     Part 2. Standard Provisions. The Standard Provisions contained in Annex A attached
hereto are incorporated herein by reference in their entirety and shall be deemed to be a part of
this Certificate of Designations to the same extent as if such provisions had been set forth in
full herein.

     Part. 3. Definitions. The following terms are used in this Certificate of Designations
(including the Standard Provisions in Annex A hereto) as defined below:

     (a) “Common Stock” means the common stock, par value $[•] per share, of the
Corporation.

     (b) “Dividend Payment Date” means [February 15, May 15, August 15 and November 15] of
each year.

     (c) “Junior Stock” means the Common Stock, [Insert titles of any existing Junior
Stock] and any other class or series of stock of the Corporation the terms of which expressly

1

 

UST Sequence Number: 114

provide that it ranks junior to Designated Preferred Stock as to dividend rights and/or as to
rights on liquidation, dissolution or winding up of the Corporation.

     (d) “Liquidation Amount” means $[1,000]1 per share of Designated Preferred
Stock.

     (e) “Minimum Amount” means $[Insert $ amount equal to 25% of the aggregate value of
the Designated Preferred Stock issued on the Original Issue Date].

     (f) “Parity Stock” means any class or series of stock of the Corporation (other than
Designated Preferred Stock) the terms of which do not expressly provide that such class or series
will rank senior or junior to Designated Preferred Stock as to dividend rights and/or as to rights
on liquidation, dissolution or winding up of the Corporation (in each case without regard to
whether dividends accrue cumulatively or non-cumulatively). Without limiting the foregoing, Parity
Stock shall include the Corporation’s [Insert title(s) of existing classes or series of Parity
Stock].

     (g) “Signing Date” means [Insert date of applicable securities purchase agreement].

     Part. 4. Certain Voting Matters. [To be inserted if the Charter provides for voting in
proportion to liquidation preferences: Whether the vote or consent of the holders of a plurality,
majority or other portion of the shares of Designated Preferred Stock and any Voting Parity Stock
has been cast or given on any matter on which the holders of shares of Designated Preferred Stock
are entitled to vote shall be determined by the Corporation by reference to the specified
liquidation amount of the shares voted or covered by the consent as if the Corporation were
liquidated on the record date for such vote or consent, if any, or, in the absence of a record
date, on the date for such vote or consent. For purposes of determining the voting rights of the
holders of Designated Preferred Stock under Section 7 of the Standard Provisions forming part of
this Certificate of Designations, each holder will be entitled to one vote for each $1,000 of
liquidation preference to which such holder’s shares are entitled.] [To be inserted if the Charter
does not provide for voting in proportion to liquidation preferences: Holders of shares of
Designated Preferred Stock will be entitled to one vote for each such share on any matter on which
holders of Designated Preferred Stock are entitled to vote, including any action by written
consent.]

[Remainder of Page Intentionally Left Blank]

 

			
	1	 	If issuer desires to issue shares with a higher dollar amount liquidation preference, liquidation preference
references will be modified accordingly. In such case (in accordance with
Section 4.7 of the Securities Purchase Agreement), the issuer will be required to enter into a deposit agreement.

2

 

UST Sequence Number: 114

     IN WITNESS WHEREOF, [Insert name of Corporation] has caused this Certificate of Designations
to be signed by [•], its [•], this [•] day of [•].

	 	 	 	 	 
	 	[Insert name of Corporation]

 	 
	 	By:  	 	 
	 	Name:  	 	 	 
	 	Title:  	 	 	 

3

 

UST Sequence Number: 114

	 	 	 	 	 

ANNEX A

STANDARD PROVISIONS

     Section 1. General Matters. Each share of Designated Preferred Stock shall be
identical in all respects to every other share of Designated Preferred Stock. The Designated
Preferred Stock shall be perpetual, subject to the provisions of Section 5 of these Standard
Provisions that form a part of the Certificate of Designations. The Designated Preferred Stock
shall rank equally with Parity Stock and shall rank senior to Junior Stock with respect to the
payment of dividends and the distribution of assets in the event of any dissolution, liquidation or
winding up of the Corporation.

     Section 2. Standard Definitions. As used herein with respect to Designated Preferred
Stock:

     (a) “Applicable Dividend Rate” means (i) during the period from the Original Issue
Date to, but excluding, the first day of the first Dividend Period commencing on or after the fifth
anniversary of the Original Issue Date, 5% per annum and (ii) from and after the first day of the
first Dividend Period commencing on or after the fifth anniversary of the Original Issue Date, 9%
per annum.

     (b) “Appropriate Federal Banking Agency” means the “appropriate Federal banking
agency” with respect to the Corporation as defined in Section 3(q) of the Federal Deposit Insurance
Act (12 U.S.C. Section 1813(q)), or any successor provision.

     (c) “Business Combination” means a merger, consolidation, statutory share exchange or
similar transaction that requires the approval of the Corporation’s stockholders.

     (d) “Business Day” means any day except Saturday, Sunday and any day on which banking
institutions in the State of New York generally are authorized or required by law or other
governmental actions to close.

     (e) “Bylaws” means the bylaws of the Corporation, as they may be amended from time to
time.

     (f) “Certificate of Designations” means the Certificate of Designations or comparable
instrument relating to the Designated Preferred Stock, of which these Standard Provisions form a
part, as it may be amended from time to time.

     (g) “Charter” means the Corporation’s certificate or articles of incorporation,
articles of association, or similar organizational document.

     (h) “Dividend Period” has the meaning set forth in Section 3(a).

     (i) “Dividend Record Date” has the meaning set forth in Section 3(a).

     (j) “Liquidation Preference” has the meaning set forth in Section 4(a).

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     (k) “Original Issue Date” means the date on which shares of Designated Preferred Stock
are first issued.

     (l) “Preferred Director” has the meaning set forth in Section 7(b).

     (m) “Preferred Stock” means any and all series of preferred stock of the Corporation,
including the Designated Preferred Stock.

     (n) “Qualified Equity Offering” means the sale and issuance for cash by the
Corporation to persons other than the Corporation or any of its subsidiaries after the Original
Issue Date of shares of perpetual Preferred Stock, Common Stock or any combination of such stock,
that, in each case, qualify as and may be included in Tier 1 capital of the Corporation at the time
of issuance under the applicable risk-based capital guidelines of the Corporation’s Appropriate
Federal Banking Agency (other than any such sales and issuances made pursuant to agreements or
arrangements entered into, or pursuant to financing plans which were publicly announced, on or
prior to October 13, 2008).

     (o) “Share Dilution Amount” has the meaning set forth in Section 3(b).

     (p) “Standard Provisions” mean these Standard Provisions that form a part of the
Certificate of Designations relating to the Designated Preferred Stock.

     (q) “Successor Preferred Stock” has the meaning set forth in Section 5(a).

     (r) “Voting Parity Stock” means, with regard to any matter as to which the holders of
Designated Preferred Stock are entitled to vote as specified in Sections 7(a) and 7(b) of these
Standard Provisions that form a part of the Certificate of Designations, any and all series of
Parity Stock upon which like voting rights have been conferred and are exercisable with respect to
such matter.

     Section 3. Dividends.

     (a) Rate. Holders of Designated Preferred Stock shall be entitled to receive, on each
share of Designated Preferred Stock if, as and when declared by the Board of Directors or any duly
authorized committee of the Board of Directors, but only out of assets legally available therefor,
cumulative cash dividends with respect to each Dividend Period (as defined below) at a rate per
annum equal to the Applicable Dividend Rate on (i) the Liquidation Amount per share of Designated
Preferred Stock and (ii) the amount of accrued and unpaid dividends for any prior Dividend Period
on such share of Designated Preferred Stock, if any. Such dividends shall begin to accrue and be
cumulative from the Original Issue Date, shall compound on each subsequent Dividend Payment Date
(i.e., no dividends shall accrue on other dividends unless and until the first Dividend Payment
Date for such other dividends has passed without such other dividends having been paid on such
date) and shall be payable quarterly in arrears on each Dividend Payment Date, commencing with the
first such Dividend Payment Date to occur at least 20 calendar days after the Original Issue Date.
In the event that any Dividend Payment Date would otherwise fall on a day that is not a Business
Day, the dividend payment due on that date will be postponed to the next day that is a Business Day
and no additional dividends will accrue as a result of that postponement. The period from and
including any Dividend Payment Date to, but

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excluding, the next Dividend Payment Date is a “Dividend Period”, provided that the initial
Dividend Period shall be the period from and including the Original Issue Date to, but excluding,
the next Dividend Payment Date.

     Dividends that are payable on Designated Preferred Stock in respect of any Dividend Period
shall be computed on the basis of a 360-day year consisting of twelve 30-day months. The amount of
dividends payable on Designated Preferred Stock on any date prior to the end of a Dividend Period,
and for the initial Dividend Period, shall be computed on the basis of a 360-day year consisting of
twelve 30-day months, and actual days elapsed over a 30-day month.

     Dividends that are payable on Designated Preferred Stock on any Dividend Payment Date will be
payable to holders of record of Designated Preferred Stock as they appear on the stock register of
the Corporation on the applicable record date, which shall be the 15th calendar day immediately
preceding such Dividend Payment Date or such other record date fixed by the Board of Directors or
any duly authorized committee of the Board of Directors that is not more than 60 nor less than 10
days prior to such Dividend Payment Date (each, a “Dividend Record Date”). Any such day that is a
Dividend Record Date shall be a Dividend Record Date whether or not such day is a Business Day.

     Holders of Designated Preferred Stock shall not be entitled to any dividends, whether payable
in cash, securities or other property, other than dividends (if any) declared and payable on
Designated Preferred Stock as specified in this Section 3 (subject to the other provisions of the
Certificate of Designations).

     (b) Priority of Dividends. So long as any share of Designated Preferred Stock remains
outstanding, no dividend or distribution shall be declared or paid on the Common Stock or any other
shares of Junior Stock (other than dividends payable solely in shares of Common Stock) or Parity
Stock, subject to the immediately following paragraph in the case of Parity Stock, and no Common
Stock, Junior Stock or Parity Stock shall be, directly or indirectly, purchased, redeemed or
otherwise acquired for consideration by the Corporation or any of its subsidiaries unless all
accrued and unpaid dividends for all past Dividend Periods, including the latest completed Dividend
Period (including, if applicable as provided in Section 3(a) above, dividends on such amount), on
all outstanding shares of Designated Preferred Stock have been or are contemporaneously declared
and paid in full (or have been declared and a sum sufficient for the payment thereof has been set
aside for the benefit of the holders of shares of Designated Preferred Stock on the applicable
record date). The foregoing limitation shall not apply to (i) redemptions, purchases or other
acquisitions of shares of Common Stock or other Junior Stock in connection with the administration
of any employee benefit plan in the ordinary course of business (including purchases to offset the
Share Dilution Amount (as defined below) pursuant to a publicly announced repurchase plan) and
consistent with past practice, provided that any purchases to offset the Share Dilution Amount
shall in no event exceed the Share Dilution Amount; (ii) purchases or other acquisitions by a
broker-dealer subsidiary of the Corporation solely for the purpose of market-making, stabilization
or customer facilitation transactions in Junior Stock or Parity Stock in the ordinary course of its
business; (iii) purchases by a broker-dealer subsidiary of the Corporation of capital stock of the
Corporation for resale pursuant to an offering by the Corporation of such capital stock
underwritten by such broker-dealer subsidiary; (iv) any dividends or distributions of rights or
Junior Stock in connection with a stockholders’

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rights plan or any redemption or repurchase of rights pursuant to any stockholders’ rights plan;
(v) the acquisition by the Corporation or any of its subsidiaries of record ownership in Junior
Stock or Parity Stock for the beneficial ownership of any other persons (other than the Corporation
or any of its subsidiaries), including as trustees or custodians; and (vi) the exchange or
conversion of Junior Stock for or into other Junior Stock or of Parity Stock for or into other
Parity Stock (with the same or lesser aggregate liquidation amount) or Junior Stock, in each case,
solely to the extent required pursuant to binding contractual agreements entered into prior to the
Signing Date or any subsequent agreement for the accelerated exercise, settlement or exchange
thereof for Common Stock. “Share Dilution Amount” means the increase in the number of diluted
shares outstanding (determined in accordance with generally accepted accounting principles in the
United States, and as measured from the date of the Corporation’s consolidated financial statements
most recently filed with the Securities and Exchange Commission prior to the Original Issue Date)
resulting from the grant, vesting or exercise of equity-based compensation to employees and
equitably adjusted for any stock split, stock dividend, reverse stock split, reclassification or
similar transaction.

     When dividends are not paid (or declared and a sum sufficient for payment thereof set aside
for the benefit of the holders thereof on the applicable record date) on any Dividend Payment Date
(or, in the case of Parity Stock having dividend payment dates different from the Dividend Payment
Dates, on a dividend payment date falling within a Dividend Period related to such Dividend Payment
Date) in full upon Designated Preferred Stock and any shares of Parity Stock, all dividends
declared on Designated Preferred Stock and all such Parity Stock and payable on such Dividend
Payment Date (or, in the case of Parity Stock having dividend payment dates different from the
Dividend Payment Dates, on a dividend payment date falling within the Dividend Period related to
such Dividend Payment Date) shall be declared pro rata so that the respective amounts of such
dividends declared shall bear the same ratio to each other as all accrued and unpaid dividends per
share on the shares of Designated Preferred Stock (including, if applicable as provided in Section
3(a) above, dividends on such amount) and all Parity Stock payable on such Dividend Payment Date
(or, in the case of Parity Stock having dividend payment dates different from the Dividend Payment
Dates, on a dividend payment date falling within the Dividend Period related to such Dividend
Payment Date) (subject to their having been declared by the Board of Directors or a duly authorized
committee of the Board of Directors out of legally available funds and including, in the case of
Parity Stock that bears cumulative dividends, all accrued but unpaid dividends) bear to each other.
If the Board of Directors or a duly authorized committee of the Board of Directors determines not
to pay any dividend or a full dividend on a Dividend Payment Date, the Corporation will provide
written notice to the holders of Designated Preferred Stock prior to such Dividend Payment Date.

     Subject to the foregoing, and not otherwise, such dividends (payable in cash, securities or
other property) as may be determined by the Board of Directors or any duly authorized committee of
the Board of Directors may be declared and paid on any securities, including Common Stock and other
Junior Stock, from time to time out of any funds legally available for such payment, and holders of
Designated Preferred Stock shall not be entitled to participate in any such dividends.

     Section 4. Liquidation Rights.

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     (a) Voluntary or Involuntary Liquidation. In the event of any liquidation, dissolution
or winding up of the affairs of the Corporation, whether voluntary or involuntary, holders of
Designated Preferred Stock shall be entitled to receive for each share of Designated Preferred
Stock, out of the assets of the Corporation or proceeds thereof (whether capital or surplus)
available for distribution to stockholders of the Corporation, subject to the rights of any
creditors of the Corporation, before any distribution of such assets or proceeds is made to or set
aside for the holders of Common Stock and any other stock of the Corporation ranking junior to
Designated Preferred Stock as to such distribution, payment in full in an amount equal to the sum
of (i) the Liquidation Amount per share and (ii) the amount of any accrued and unpaid dividends
(including, if applicable as provided in Section 3(a) above, dividends on such amount), whether or
not declared, to the date of payment (such amounts collectively, the “Liquidation Preference”).

     (b) Partial Payment. If in any distribution described in Section 4(a) above the assets
of the Corporation or proceeds thereof are not sufficient to pay in full the amounts payable with
respect to all outstanding shares of Designated Preferred Stock and the corresponding amounts
payable with respect of any other stock of the Corporation ranking equally with Designated
Preferred Stock as to such distribution, holders of Designated Preferred Stock and the holders of
such other stock shall share ratably in any such distribution in proportion to the full respective
distributions to which they are entitled.

     (c) Residual Distributions. If the Liquidation Preference has been paid in full to all
holders of Designated Preferred Stock and the corresponding amounts payable with respect of any
other stock of the Corporation ranking equally with Designated Preferred Stock as to such
distribution has been paid in full, the holders of other stock of the Corporation shall be entitled
to receive all remaining assets of the Corporation (or proceeds thereof) according to their
respective rights and preferences.

     (d) Merger, Consolidation and Sale of Assets Not Liquidation. For purposes of this
Section 4, the merger or consolidation of the Corporation with any other corporation or other
entity, including a merger or consolidation in which the holders of Designated Preferred Stock
receive cash, securities or other property for their shares, or the sale, lease or exchange (for
cash, securities or other property) of all or substantially all of the assets of the Corporation,
shall not constitute a liquidation, dissolution or winding up of the Corporation.

     Section 5. Redemption.

     (a) Optional Redemption. Except as provided below, the Designated Preferred Stock may
not be redeemed prior to the first Dividend Payment Date falling on or after the third anniversary
of the Original Issue Date. On or after the first Dividend Payment Date falling on or after the
third anniversary of the Original Issue Date, the Corporation, at its option, subject to the
approval of the Appropriate Federal Banking Agency, may redeem, in whole or in part, at any time
and from time to time, out of funds legally available therefor, the shares of Designated Preferred
Stock at the time outstanding, upon notice given as provided in Section 5(c) below, at a redemption
price equal to the sum of (i) the Liquidation Amount per share and (ii) except as otherwise
provided below, any accrued and unpaid dividends (including, if applicable as

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provided in Section 3(a) above, dividends on such amount) (regardless of whether any dividends are
actually declared) to, but excluding, the date fixed for redemption.

     Notwithstanding the foregoing, prior to the first Dividend Payment Date falling on or after
the third anniversary of the Original Issue Date, the Corporation, at its option, subject to the
approval of the Appropriate Federal Banking Agency, may redeem, in whole or in part, at any time
and from time to time, the shares of Designated Preferred Stock at the time outstanding, upon
notice given as provided in Section 5(c) below, at a redemption price equal to the sum of (i) the
Liquidation Amount per share and (ii) except as otherwise provided below, any accrued and unpaid
dividends (including, if applicable as provided in Section 3(a) above, dividends on such amount)
(regardless of whether any dividends are actually declared) to, but excluding, the date fixed for
redemption; provided that (x) the Corporation (or any successor by Business Combination) has
received aggregate gross proceeds of not less than the Minimum Amount (plus the “Minimum Amount” as
defined in the relevant certificate of designations for each other outstanding series of preferred
stock of such successor that was originally issued to the United States Department of the Treasury
(the “Successor Preferred Stock”) in connection with the Troubled Asset Relief Program
Capital Purchase Program) from one or more Qualified Equity Offerings (including Qualified Equity
Offerings of such successor), and (y) the aggregate redemption price of the Designated Preferred
Stock (and any Successor Preferred Stock) redeemed pursuant to this paragraph may not exceed the
aggregate net cash proceeds received by the Corporation (or any successor by Business Combination)
from such Qualified Equity Offerings (including Qualified Equity Offerings of such successor).

     The redemption price for any shares of Designated Preferred Stock shall be payable on the
redemption date to the holder of such shares against surrender of the certificate(s) evidencing
such shares to the Corporation or its agent. Any declared but unpaid dividends payable on a
redemption date that occurs subsequent to the Dividend Record Date for a Dividend Period shall not
be paid to the holder entitled to receive the redemption price on the redemption date, but rather
shall be paid to the holder of record of the redeemed shares on such Dividend Record Date relating
to the Dividend Payment Date as provided in Section 3 above.

     (b) No Sinking Fund. The Designated Preferred Stock will not be subject to any
mandatory redemption, sinking fund or other similar provisions. Holders of Designated Preferred
Stock will have no right to require redemption or repurchase of any shares of Designated Preferred
Stock.

     (c) Notice of Redemption. Notice of every redemption of shares of Designated Preferred
Stock shall be given by first class mail, postage prepaid, addressed to the holders of record of
the shares to be redeemed at their respective last addresses appearing on the books of the
Corporation. Such mailing shall be at least 30 days and not more than 60 days before the date fixed
for redemption. Any notice mailed as provided in this Subsection shall be conclusively presumed to
have been duly given, whether or not the holder receives such notice, but failure duly to give such
notice by mail, or any defect in such notice or in the mailing thereof, to any holder of shares of
Designated Preferred Stock designated for redemption shall not affect the validity of the
proceedings for the redemption of any other shares of Designated Preferred Stock. Notwithstanding
the foregoing, if shares of Designated Preferred Stock are issued in book-entry form through The
Depository Trust Corporation or any other similar facility, notice of

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redemption may be given to the holders of Designated Preferred Stock at such time and in any manner
permitted by such facility. Each notice of redemption given to a holder shall state: (1) the
redemption date; (2) the number of shares of Designated Preferred Stock to be redeemed and, if less
than all the shares held by such holder are to be redeemed, the number of such shares to be
redeemed from such holder; (3) the redemption price; and (4) the place or places where certificates
for such shares are to be surrendered for payment of the redemption price.

     (d) Partial Redemption. In case of any redemption of part of the shares of Designated
Preferred Stock at the time outstanding, the shares to be redeemed shall be selected either pro
rata or in such other manner as the Board of Directors or a duly authorized committee thereof may
determine to be fair and equitable. Subject to the provisions hereof, the Board of Directors or a
duly authorized committee thereof shall have full power and authority to prescribe the terms and
conditions upon which shares of Designated Preferred Stock shall be redeemed from time to time. If
fewer than all the shares represented by any certificate are redeemed, a new certificate shall be
issued representing the unredeemed shares without charge to the holder thereof.

     (e) Effectiveness of Redemption. If notice of redemption has been duly given and if on
or before the redemption date specified in the notice all funds necessary for the redemption have
been deposited by the Corporation, in trust for the pro rata benefit of the holders of the shares
called for redemption, with a bank or trust company doing business in the Borough of Manhattan, The
City of New York, and having a capital and surplus of at least $500 million and selected by the
Board of Directors, so as to be and continue to be available solely therefor, then, notwithstanding
that any certificate for any share so called for redemption has not been surrendered for
cancellation, on and after the redemption date dividends shall cease to accrue on all shares so
called for redemption, all shares so called for redemption shall no longer be deemed outstanding
and all rights with respect to such shares shall forthwith on such redemption date cease and
terminate, except only the right of the holders thereof to receive the amount payable on such
redemption from such bank or trust company, without interest. Any funds unclaimed at the end of
three years from the redemption date shall, to the extent permitted by law, be released to the
Corporation, after which time the holders of the shares so called for redemption shall look only to
the Corporation for payment of the redemption price of such shares.

     (f) Status of Redeemed Shares. Shares of Designated Preferred Stock that are redeemed,
repurchased or otherwise acquired by the Corporation shall revert to authorized but unissued shares
of Preferred Stock (provided that any such cancelled shares of Designated Preferred Stock may be
reissued only as shares of any series of Preferred Stock other than Designated Preferred Stock).

     Section 6. Conversion. Holders of Designated Preferred Stock shares shall have no
right to exchange or convert such shares into any other securities.

     Section 7. Voting Rights.

     (a) General. The holders of Designated Preferred Stock shall not have any voting
rights except as set forth below or as otherwise from time to time required by law.

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     (b) Preferred Stock Directors. Whenever, at any time or times, dividends payable on
the shares of Designated Preferred Stock have not been paid for an aggregate of six quarterly
Dividend Periods or more, whether or not consecutive, the authorized number of directors of the
Corporation shall automatically be increased by two and the holders of the Designated Preferred
Stock shall have the right, with holders of shares of any one or more other classes or series of
Voting Parity Stock outstanding at the time, voting together as a class, to elect two directors
(hereinafter the “Preferred Directors” and each a “Preferred Director”) to fill such newly
created directorships at the Corporation’s next annual meeting of stockholders (or at a special
meeting called for that purpose prior to such next annual meeting) and at each subsequent annual
meeting of stockholders until all accrued and unpaid dividends for all past Dividend Periods,
including the latest completed Dividend Period (including, if applicable as provided in Section
3(a) above, dividends on such amount), on all outstanding shares of Designated Preferred Stock have
been declared and paid in full at which time such right shall terminate with respect to the
Designated Preferred Stock, except as herein or by law expressly provided, subject to revesting in
the event of each and every subsequent default of the character above mentioned; provided that it
shall be a qualification for election for any Preferred Director that the election of such
Preferred Director shall not cause the Corporation to violate any corporate governance requirements
of any securities exchange or other trading facility on which securities of the Corporation may
then be listed or traded that listed or traded companies must have a majority of independent
directors. Upon any termination of the right of the holders of shares of Designated Preferred Stock
and Voting Parity Stock as a class to vote for directors as provided above, the Preferred Directors
shall cease to be qualified as directors, the term of office of all Preferred Directors then in
office shall terminate immediately and the authorized number of directors shall be reduced by the
number of Preferred Directors elected pursuant hereto. Any Preferred Director may be removed at any
time, with or without cause, and any vacancy created thereby may be filled, only by the affirmative
vote of the holders a majority of the shares of Designated Preferred Stock at the time outstanding
voting separately as a class together with the holders of shares of Voting Parity Stock, to the
extent the voting rights of such holders described above are then exercisable. If the office of any
Preferred Director becomes vacant for any reason other than removal from office as aforesaid, the
remaining Preferred Director may choose a successor who shall hold office for the unexpired term in
respect of which such vacancy occurred.

     (c) Class Voting Rights as to Particular Matters. So long as any shares of Designated
Preferred Stock are outstanding, in addition to any other vote or consent of stockholders required
by law or by the Charter, the vote or consent of the holders of at least 66 2/3% of the shares of
Designated Preferred Stock at the time outstanding, voting as a separate class, given in person or
by proxy, either in writing without a meeting or by vote at any meeting called for the purpose,
shall be necessary for effecting or validating:

     (i) Authorization of Senior Stock. Any amendment or alteration of the
Certificate of Designations for the Designated Preferred Stock or the Charter to authorize
or create or increase the authorized amount of, or any issuance of, any shares of, or any
securities convertible into or exchangeable or exercisable for shares of, any class or
series of capital stock of the Corporation ranking senior to Designated Preferred Stock with
respect to either or both the payment of dividends and/or the distribution of assets on any
liquidation, dissolution or winding up of the Corporation;

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     (ii) Amendment of Designated Preferred Stock. Any amendment, alteration or
repeal of any provision of the Certificate of Designations for the Designated Preferred
Stock or the Charter (including, unless no vote on such merger or consolidation is required
by Section 7(c)(iii) below, any amendment, alteration or repeal by means of a merger,
consolidation or otherwise) so as to adversely affect the rights, preferences, privileges or
voting powers of the Designated Preferred Stock; or

     (iii) Share Exchanges, Reclassifications, Mergers and Consolidations. Any
consummation of a binding share exchange or reclassification involving the Designated
Preferred Stock, or of a merger or consolidation of the Corporation with another corporation
or other entity, unless in each case (x) the shares of Designated Preferred Stock remain
outstanding or, in the case of any such merger or consolidation with respect to which the
Corporation is not the surviving or resulting entity, are converted into or exchanged for
preference securities of the surviving or resulting entity or its ultimate parent, and (y)
such shares remaining outstanding or such preference securities, as the case may be, have
such rights, preferences, privileges and voting powers, and limitations and restrictions
thereof, taken as a whole, as are not materially less favorable to the holders thereof than
the rights, preferences, privileges and voting powers, and limitations and restrictions
thereof, of Designated Preferred Stock immediately prior to such consummation, taken as a
whole;

provided, however, that for all purposes of this Section 7(c), any increase in the amount of the
authorized Preferred Stock, including any increase in the authorized amount of Designated Preferred
Stock necessary to satisfy preemptive or similar rights granted by the Corporation to other persons
prior to the Signing Date, or the creation and issuance, or an increase in the authorized or issued
amount, whether pursuant to preemptive or similar rights or otherwise, of any other series of
Preferred Stock, or any securities convertible into or exchangeable or exercisable for any other
series of Preferred Stock, ranking equally with and/or junior to Designated Preferred Stock with
respect to the payment of dividends (whether such dividends are cumulative or non-cumulative) and
the distribution of assets upon liquidation, dissolution or winding up of the Corporation will not
be deemed to adversely affect the rights, preferences, privileges or voting powers, and shall not
require the affirmative vote or consent of, the holders of outstanding shares of the Designated
Preferred Stock.

     (d) Changes after Provision for Redemption. No vote or consent of the holders of
Designated Preferred Stock shall be required pursuant to Section 7(c) above if, at or prior to the
time when any such vote or consent would otherwise be required pursuant to such Section, all
outstanding shares of the Designated Preferred Stock shall have been redeemed, or shall have been
called for redemption upon proper notice and sufficient funds shall have been deposited in trust
for such redemption, in each case pursuant to Section 5 above.

     (e) Procedures for Voting and Consents. The rules and procedures for calling and
conducting any meeting of the holders of Designated Preferred Stock (including, without limitation,
the fixing of a record date in connection therewith), the solicitation and use of proxies at such a
meeting, the obtaining of written consents and any other aspect or matter with regard to such a
meeting or such consents shall be governed by any rules of the Board of Directors or any duly
authorized committee of the Board of Directors, in its discretion, may adopt from time to

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time, which rules and procedures shall conform to the requirements of the Charter, the Bylaws, and
applicable law and the rules of any national securities exchange or other trading facility on which
Designated Preferred Stock is listed or traded at the time.

     Section 8. Record Holders. To the fullest extent permitted by applicable law, the
Corporation and the transfer agent for Designated Preferred Stock may deem and treat the record
holder of any share of Designated Preferred Stock as the true and lawful owner thereof for all
purposes, and neither the Corporation nor such transfer agent shall be affected by any notice to
the contrary.

     Section 9. Notices. All notices or communications in respect of Designated Preferred
Stock shall be sufficiently given if given in writing and delivered in person or by first class
mail, postage prepaid, or if given in such other manner as may be permitted in this Certificate of
Designations, in the Charter or Bylaws or by applicable law. Notwithstanding the foregoing, if
shares of Designated Preferred Stock are issued in book-entry form through The Depository Trust
Corporation or any similar facility, such notices may be given to the holders of Designated
Preferred Stock in any manner permitted by such facility.

     Section 10. No Preemptive Rights. No share of Designated Preferred Stock shall have
any rights of preemption whatsoever as to any securities of the Corporation, or any warrants,
rights or options issued or granted with respect thereto, regardless of how such securities, or
such warrants, rights or options, may be designated, issued or granted.

     Section 11. Replacement Certificates. The Corporation shall replace any mutilated
certificate at the holder’s expense upon surrender of that certificate to the Corporation. The
Corporation shall replace certificates that become destroyed, stolen or lost at the holder’s
expense upon delivery to the Corporation of reasonably satisfactory evidence that the certificate
has been destroyed, stolen or lost, together with any indemnity that may be reasonably required by
the Corporation.

     Section 12. Other Rights. The shares of Designated Preferred Stock shall not have any
rights, preferences, privileges or voting powers or relative, participating, optional or other
special rights, or qualifications, limitations or restrictions thereof, other than as set forth
herein or in the Charter or as provided by applicable law.

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ANNEX B

FORM OF WAIVER

In consideration for the benefits I will receive as a result of my employer’s participation in the
United States Department of the Treasury’s TARP Capital Purchase Program, I hereby voluntarily
waive any claim against the United States or my employer for any changes to my compensation or
benefits that are required to comply with the regulation issued by the Department of the Treasury
as published in the Federal Register on October 20, 2008.

I acknowledge that this regulation may require modification of the compensation, bonus, incentive
and other benefit plans, arrangements, policies and agreements (including so-called “golden
parachute” agreements) that I have with my employer or in which I participate as they relate to the
period the United States holds any equity or debt securities of my employer acquired through the
TARP Capital Purchase Program.

This waiver includes all claims I may have under the laws of the United States or any state related
to the requirements imposed by the aforementioned regulation, including without limitation a claim
for any compensation or other payments I would otherwise receive, any challenge to the process by
which this regulation was adopted and any tort or constitutional claim about the effect of these
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ANNEX C

FORM OF OPINION

(a) The Company has been duly incorporated and is validly existing as a corporation in good
standing under the laws of the state of its incorporation.

(b) The Preferred Shares have been duly and validly authorized, and, when issued and delivered
pursuant to the Agreement, the Preferred Shares will be duly and validly issued and fully paid and
non-assessable, will not be issued in violation of any preemptive rights, and will rank pari passu
with or senior to all other series or classes of Preferred Stock issued on the Closing Date with
respect to the payment of dividends and the distribution of assets in the event of any dissolution,
liquidation or winding up of the Company.

(c) The Warrant has been duly authorized and, when executed and delivered as contemplated by the
Agreement, will constitute a valid and legally binding obligation of the Company enforceable
against the Company in accordance with its terms, except as the same may be limited by applicable
bankruptcy, insolvency, reorganization, moratorium or similar laws affecting the enforcement of
creditors’ rights generally and general equitable principles, regardless of whether such
enforceability is considered in a proceeding at law or in equity.

(d) The shares of Common Stock issuable upon exercise of the Warrant have been duly authorized and
reserved for issuance upon exercise of the Warrant and when so issued in accordance with the terms
of the Warrant will be validly issued, fully paid and non-assessable [insert, if applicable: ,
subject to the approvals of the Company’s stockholders set forth on Schedule C].

(e) The Company has the corporate power and authority to execute and deliver the Agreement and the
Warrant and [insert, if applicable: , subject to the approvals of the Company’s stockholders set
forth on Schedule C,] to carry out its obligations thereunder (which includes the issuance of the
Preferred Shares, Warrant and Warrant Shares).

(f) The execution, delivery and performance by the Company of the Agreement and the Warrant and the
consummation of the transactions contemplated thereby have been duly authorized by all necessary
corporate action on the part of the Company and its stockholders, and no further approval or
authorization is required on the part of the Company [insert, if applicable:, subject, in each
case, to the approvals of the Company’s stockholders set forth on Schedule C].

(g) The Agreement is a valid and binding obligation of the Company enforceable against the
Company in accordance with its terms, except as the same may be limited by applicable bankruptcy,
insolvency, reorganization, moratorium or similar laws affecting the enforcement of creditors’
rights generally and general equitable principles, regardless of whether such enforceability is
considered in a proceeding at law or in equity; provided, however, such counsel need express no
opinion with respect to Section 4.5(g) or the severability provisions of the Agreement insofar as
Section 4.5(g) is concerned.

 

 

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ANNEX D

FORM OF WARRANT

[SEE ATTACHED]

 

 

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ANNEX D

FORM OF WARRANT TO PURCHASE COMMON STOCK

THE SECURITIES REPRESENTED BY THIS INSTRUMENT HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF
1933, AS AMENDED, OR THE SECURITIES LAWS OF ANY STATE AND MAY NOT BE TRANSFERRED, SOLD OR OTHERWISE
DISPOSED OF EXCEPT WHILE A REGISTRATION STATEMENT RELATING THERETO IS IN EFFECT UNDER SUCH ACT AND
APPLICABLE STATE SECURITIES LAWS OR PURSUANT TO AN EXEMPTION FROM REGISTRATION UNDER SUCH ACT OR
SUCH LAWS. THIS INSTRUMENT IS ISSUED SUBJECT TO THE RESTRICTIONS ON TRANSFER AND OTHER PROVISIONS
OF A SECURITIES PURCHASE AGREEMENT BETWEEN THE ISSUER OF THESE SECURITIES AND THE INVESTOR REFERRED
TO THEREIN, A COPY OF WHICH IS ON FILE WITH THE ISSUER. THE SECURITIES REPRESENTED BY THIS
INSTRUMENT MAY NOT BE SOLD OR OTHERWISE TRANSFERRED EXCEPT IN COMPLIANCE WITH SAID AGREEMENT. ANY
SALE OR OTHER TRANSFER NOT IN COMPLIANCE WITH SAID

AGREEMENT WILL BE VOID.

WARRANT

to purchase

 

Shares of Common Stock

of
                                        

Issue Date:                                        
          

     1. Definitions. Unless the context otherwise requires, when used herein the following
terms shall have the meanings indicated.

     “Affiliate” has the meaning ascribed to it in the Purchase Agreement.

     “Appraisal Procedure” means a procedure whereby two independent appraisers, one chosen by the
Company and one by the Original Warrantholder, shall mutually agree upon the determinations then
the subject of appraisal. Each party shall deliver a notice to the other appointing its appraiser
within 15 days after the Appraisal Procedure is invoked. If within 30 days after appointment of the
two appraisers they are unable to agree upon the amount in question, a third independent appraiser
shall be chosen within 10 days thereafter by the mutual consent of such first two appraisers. The
decision of the third appraiser so appointed and chosen shall be given within 30 days after the
selection of such third appraiser. If three appraisers shall be appointed and the determination of
one appraiser is disparate from the middle determination by more than twice the amount by which the
other determination is disparate from the middle determination, then the determination of such
appraiser shall be excluded, the remaining two determinations shall be averaged and such average
shall be binding and conclusive upon the

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Company and the Original Warrantholder; otherwise, the average of all three determinations shall be
binding upon the Company and the Original Warrantholder. The costs of conducting any Appraisal
Procedure shall be borne by the Company.

     “Board of Directors” means the board of directors of the Company, including any duly
authorized committee thereof.

     “Business Combination” means a merger, consolidation, statutory share exchange or similar
transaction that requires the approval of the Company’s stockholders.

“business day” means any day except Saturday, Sunday and any day on which banking institutions in
the State of New York generally are authorized or required by law or other governmental actions to
close.

     “Capital Stock” means (A) with respect to any Person that is a corporation or company, any and
all shares, interests, participations or other equivalents (however designated) of capital or
capital stock of such Person and (B) with respect to any Person that is not a corporation or
company, any and all partnership or other equity interests of such Person.

     “Charter” means, with respect to any Person, its certificate or articles of incorporation,
articles of association, or similar organizational document.

     “Common Stock” has the meaning ascribed to it in the Purchase Agreement.

     “Company” means the Person whose name, corporate or other organizational form and jurisdiction
of organization is set forth in Item 1 of Schedule A hereto.

     “conversion” has the meaning set forth in Section 13(B).

     “convertible securities” has the meaning set forth in Section 13(B).

     “CPP” has the meaning ascribed to it in the Purchase Agreement.

     “Exchange Act” means the Securities Exchange Act of 1934, as amended, or any successor
statute, and the rules and regulations promulgated thereunder.

     “Exercise Price” means the amount set forth in Item 2 of Schedule A hereto.

     “Expiration Time” has the meaning set forth in Section 3.

     “Fair Market Value” means, with respect to any security or other property, the fair market
value of such security or other property as determined by the Board of Directors, acting in good
faith or, with respect to Section 14, as determined by the Original Warrantholder acting in good
faith. For so long as the Original Warrantholder holds this Warrant or any portion thereof, it may
object in writing to the Board of Director’s calculation of fair market value within 10 days of
receipt of written notice thereof. If the Original Warrantholder and the Company are unable to
agree on fair market value during the 10-day period following the delivery of the Original
Warrantholder’s objection, the Appraisal Procedure may be invoked by either party to

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determine Fair Market Value by delivering written notification thereof not later than the 30th day
after delivery of the Original Warrantholder’s objection.

     “Governmental Entities” has the meaning ascribed to it in the Purchase Agreement.

     “Initial Number” has the meaning set forth in Section 13(B).

     “Issue Date” means the date set forth in Item 3 of Schedule A hereto.

     “Market Price” means, with respect to a particular security, on any given day, the last
reported sale price regular way or, in case no such reported sale takes place on such day, the
average of the last closing bid and ask prices regular way, in either case on the principal
national securities exchange on which the applicable securities are listed or admitted to trading,
or if not listed or admitted to trading on any national securities exchange, the average of the
closing bid and ask prices as furnished by two members of the Financial Industry Regulatory
Authority, Inc. selected from time to time by the Company for that purpose. “Market Price” shall be
determined without reference to after hours or extended hours trading. If such security is not
listed and traded in a manner that the quotations referred to above are available for the period
required hereunder, the Market Price per share of Common Stock shall be deemed to be (i) in the
event that any portion of the Warrant is held by the Original Warrantholder, the fair market value
per share of such security as determined in good faith by the Original Warrantholder or (ii) in all
other circumstances, the fair market value per share of such security as determined in good faith
by the Board of Directors in reliance on an opinion of a nationally recognized independent
investment banking corporation retained by the Company for this purpose and certified in a
resolution to the Warrantholder. For the purposes of determining the Market Price of the Common
Stock on the “trading day” preceding, on or following the occurrence of an event, (i) that trading
day shall be deemed to commence immediately after the regular scheduled closing time of trading on
the New York Stock Exchange or, if trading is closed at an earlier time, such earlier time and (ii)
that trading day shall end at the next regular scheduled closing time, or if trading is closed at
an earlier time, such earlier time (for the avoidance of doubt, and as an example, if the Market
Price is to be determined as of the last trading day preceding a specified event and the closing
time of trading on a particular day is 4:00 p.m. and the specified event occurs at 5:00 p.m. on
that day, the Market Price would be determined by reference to such 4:00 p.m. closing price).

     “Ordinary Cash Dividends” means a regular quarterly cash dividend on shares of Common Stock
out of surplus or net profits legally available therefor (determined in accordance with generally
accepted accounting principles in effect from time to time), provided that Ordinary Cash Dividends
shall not include any cash dividends paid subsequent to the Issue Date to the extent the aggregate
per share dividends paid on the outstanding Common Stock in any quarter exceed the amount set forth
in Item 4 of Schedule A hereto, as adjusted for any stock split, stock dividend, reverse stock
split, reclassification or similar transaction.

     “Original Warrantholder” means the United States Department of the Treasury. Any actions
specified to be taken by the Original Warrantholder hereunder may only be taken by such Person and
not by any other Warrantholder.

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     “Permitted Transactions” has the meaning set forth in Section 13(B).

     “Person” has the meaning given to it in Section 3(a)(9) of the Exchange Act and as used in
Sections 13(d)(3) and 14(d)(2) of the Exchange Act.

     “Per Share Fair Market Value” has the meaning set forth in Section 13(C).

     “Preferred Shares” means the perpetual preferred stock issued to the Original Warrantholder on
the Issue Date pursuant to the Purchase Agreement.

     “Pro Rata Repurchases” means any purchase of shares of Common Stock by the Company or any
Affiliate thereof pursuant to (A) any tender offer or exchange offer subject to Section 13(e) or
14(e) of the Exchange Act or Regulation 14E promulgated thereunder or (B) any other offer available
to substantially all holders of Common Stock, in the case of both (A) or (B), whether for cash,
shares of Capital Stock of the Company, other securities of the Company, evidences of indebtedness
of the Company or any other Person or any other property (including, without limitation, shares of
Capital Stock, other securities or evidences of indebtedness of a subsidiary), or any combination
thereof, effected while this Warrant is outstanding. The “Effective Date” of a Pro Rata Repurchase
shall mean the date of acceptance of shares for purchase or exchange by the Company under any
tender or exchange offer which is a Pro Rata Repurchase or the date of purchase with respect to any
Pro Rata Repurchase that is not a tender or exchange offer.

     “Purchase Agreement” means the Securities Purchase Agreement – Standard Terms incorporated
into the Letter Agreement, dated as of the date set forth in Item 5 of Schedule A hereto, as
amended from time to time, between the Company and the United States Department of the Treasury
(the “Letter Agreement”), including all annexes and schedules thereto.

     “Qualified Equity Offering” has the meaning ascribed to it in the Purchase Agreement.

     “Regulatory Approvals” with respect to the Warrantholder, means, to the extent applicable and
required to permit the Warrantholder to exercise this Warrant for shares of Common Stock and to own
such Common Stock without the Warrantholder being in violation of applicable law, rule or
regulation, the receipt of any necessary approvals and authorizations of, filings and registrations
with, notifications to, or expiration or termination of any applicable waiting period under, the
Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended, and the rules and regulations
thereunder.

     “SEC” means the U.S. Securities and Exchange Commission.

     “Securities Act” means the Securities Act of 1933, as amended, or any successor statute, and
the rules and regulations promulgated thereunder.

     “Shares” has the meaning set forth in Section 2.

     “trading day” means (A) if the shares of Common Stock are not traded on any national or
regional securities exchange or association or over-the-counter market, a business day or (B) if
the shares of Common Stock are traded on any national or regional securities exchange or

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association or over-the-counter market, a business day on which such relevant exchange or
quotation system is scheduled to be open for business and on which the shares of Common Stock (i)
are not suspended from trading on any national or regional securities exchange or association or
over-the-counter market for any period or periods aggregating one half hour or longer; and (ii)
have traded at least once on the national or regional securities exchange or association or
over-the-counter market that is the primary market for the trading of the shares of Common Stock.

     “U.S. GAAP” means United States generally accepted accounting principles.

     “Warrantholder” has the meaning set forth in Section 2.

     “Warrant” means this Warrant, issued pursuant to the Purchase Agreement.

2. Number of Shares; Exercise Price. This certifies that, for value received, the United
States Department of the Treasury or its permitted assigns (the “Warrantholder”) is entitled, upon
the terms and subject to the conditions hereinafter set forth, to acquire from the Company, in
whole or in part, after the receipt of all applicable Regulatory Approvals, if any, up to an
aggregate of the number of fully paid and nonassessable shares of Common Stock set forth in Item 6
of Schedule A hereto, at a purchase price per share of Common Stock equal to the Exercise Price.
The number of shares of Common Stock (the “Shares”) and the Exercise Price are subject to
adjustment as provided herein, and all references to “Common Stock,” “Shares” and “Exercise Price”
herein shall be deemed to include any such adjustment or series of adjustments.

3. Exercise of Warrant; Term. Subject to Section 2, to the extent permitted by applicable
laws and regulations, the right to purchase the Shares represented by this Warrant is exercisable,
in whole or in part by the Warrantholder, at any time or from time to time after the execution and
delivery of this Warrant by the Company on the date hereof, but in no event later than 5:00 p.m.,
New York City time on the tenth anniversary of the Issue Date (the “Expiration Time”), by (A) the
surrender of this Warrant and Notice of Exercise annexed hereto, duly completed and executed on
behalf of the Warrantholder, at the principal executive office of the Company located at the
address set forth in Item 7 of Schedule A hereto (or such other office or agency of the Company in
the United States as it may designate by notice in writing to the Warrantholder at the address of
the Warrantholder appearing on the books of the Company), and (B) payment of the Exercise Price for
the Shares thereby purchased:

     (i) by having the Company withhold, from the shares of Common Stock that would
otherwise be delivered to the Warrantholder upon such exercise, shares of Common stock
issuable upon exercise of the Warrant equal in value to the aggregate Exercise Price as to
which this Warrant is so exercised based on the Market Price of the Common Stock on the
trading day on which this Warrant is exercised and the Notice of Exercise is delivered to
the Company pursuant to this Section 3, or

     (ii) with the consent of both the Company and the Warrantholder, by tendering in cash,
by certified or cashier’s check payable to the order of the Company, or by wire transfer of
immediately available funds to an account designated by the Company.

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     If the Warrantholder does not exercise this Warrant in its entirety, the Warrantholder will be
entitled to receive from the Company within a reasonable time, and in any event not exceeding three
business days, a new warrant in substantially identical form for the purchase of that number of
Shares equal to the difference between the number of Shares subject to this Warrant and the number
of Shares as to which this Warrant is so exercised. Notwithstanding anything in this Warrant to the
contrary, the Warrantholder hereby acknowledges and agrees that its exercise of this Warrant for
Shares is subject to the condition that the Warrantholder will have first received any applicable
Regulatory Approvals.

     4. Issuance of Shares; Authorization; Listing. Certificates for Shares issued upon
exercise of this Warrant will be issued in such name or names as the Warrantholder may designate
and will be delivered to such named Person or Persons within a reasonable time, not to exceed three
business days after the date on which this Warrant has been duly exercised in accordance with the
terms of this Warrant. The Company hereby represents and warrants that any Shares issued upon the
exercise of this Warrant in accordance with the provisions of Section 3 will be duly and validly
authorized and issued, fully paid and nonassessable and free from all taxes, liens and charges
(other than liens or charges created by the Warrantholder, income and franchise taxes incurred in
connection with the exercise of the Warrant or taxes in respect of any transfer occurring
contemporaneously therewith). The Company agrees that the Shares so issued will be deemed to have
been issued to the Warrantholder as of the close of business on the date on which this Warrant and
payment of the Exercise Price are delivered to the Company in accordance with the terms of this
Warrant, notwithstanding that the stock transfer books of the Company may then be closed or
certificates representing such Shares may not be actually delivered on such date. The Company will
at all times reserve and keep available, out of its authorized but unissued Common Stock, solely
for the purpose of providing for the exercise of this Warrant, the aggregate number of shares of
Common Stock then issuable upon exercise of this Warrant at any time. The Company will (A) procure,
at its sole expense, the listing of the Shares issuable upon exercise of this Warrant at any time,
subject to issuance or notice of issuance, on all principal stock exchanges on which the Common
Stock is then listed or traded and (B) maintain such listings of such Shares at all times after
issuance. The Company will use reasonable best efforts to ensure that the Shares may be issued
without violation of any applicable law or regulation or of any requirement of any securities
exchange on which the Shares are listed or traded.

     5. No Fractional Shares or Scrip. No fractional Shares or scrip representing
fractional Shares shall be issued upon any exercise of this Warrant. In lieu of any fractional
Share to which the Warrantholder would otherwise be entitled, the Warrantholder shall be entitled
to receive a cash payment equal to the Market Price of the Common Stock on the last trading day
preceding the date of exercise less the pro-rated Exercise Price for such fractional share.

     6. No Rights as Stockholders; Transfer Books. This Warrant does not entitle the
Warrantholder to any voting rights or other rights as a stockholder of the Company prior to the
date of exercise hereof. The Company will at no time close its transfer books against transfer of
this Warrant in any manner which interferes with the timely exercise of this Warrant.

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     7. Charges, Taxes and Expenses. Issuance of certificates for Shares to the
Warrantholder upon the exercise of this Warrant shall be made without charge to the Warrantholder
for any issue or transfer tax or other incidental expense in respect of the issuance of such
certificates, all of which taxes and expenses shall be paid by the Company.

     8. Transfer/Assignment.

     (A) Subject to compliance with clause (B) of this Section 8, this Warrant and all rights
hereunder are transferable, in whole or in part, upon the books of the Company by the registered
holder hereof in person or by duly authorized attorney, and a new warrant shall be made and
delivered by the Company, of the same tenor and date as this Warrant but registered in the name of
one or more transferees, upon surrender of this Warrant, duly endorsed, to the office or agency of
the Company described in Section 3. All expenses (other than stock transfer taxes) and other
charges payable in connection with the preparation, execution and delivery of the new warrants
pursuant to this Section 8 shall be paid by the Company.

     (B) The transfer of the Warrant and the Shares issued upon exercise of the Warrant are subject
to the restrictions set forth in Section 4.4 of the Purchase Agreement. If and for so long as
required by the Purchase Agreement, this Warrant shall contain the legends as set forth in Sections
4.2(a) and 4.2(b) of the Purchase Agreement.

     9. Exchange and Registry of Warrant. This Warrant is exchangeable, upon the surrender
hereof by the Warrantholder to the Company, for a new warrant or warrants of like tenor and
representing the right to purchase the same aggregate number of Shares. The Company shall maintain
a registry showing the name and address of the Warrantholder as the registered holder of this
Warrant. This Warrant may be surrendered for exchange or exercise in accordance with its terms, at
the office of the Company, and the Company shall be entitled to rely in all respects, prior to
written notice to the contrary, upon such registry.

     10. Loss, Theft, Destruction or Mutilation of Warrant. Upon receipt by the Company of
evidence reasonably satisfactory to it of the loss, theft, destruction or mutilation of this
Warrant, and in the case of any such loss, theft or destruction, upon receipt of a bond, indemnity
or security reasonably satisfactory to the Company, or, in the case of any such mutilation, upon
surrender and cancellation of this Warrant, the Company shall make and deliver, in lieu of such
lost, stolen, destroyed or mutilated Warrant, a new Warrant of like tenor and representing the
right to purchase the same aggregate number of Shares as provided for in such lost, stolen,
destroyed or mutilated Warrant.

     11. Saturdays, Sundays, Holidays, etc. If the last or appointed day for the taking of
any action or the expiration of any right required or granted herein shall not be a business day,
then such action may be taken or such right may be exercised on the next succeeding day that is a
business day.

     12. Rule 144 Information. The Company covenants that it will use its reasonable best
efforts to timely file all reports and other documents required to be filed by it under the
Securities Act and the Exchange Act and the rules and regulations promulgated by the SEC thereunder
(or, if the Company is not required to file such reports, it will, upon the request of any

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Warrantholder, make publicly available such information as necessary to permit sales pursuant to
Rule 144 under the Securities Act), and it will use reasonable best efforts to take such further
action as any Warrantholder may reasonably request, in each case to the extent required from time
to time to enable such holder to, if permitted by the terms of this Warrant and the Purchase
Agreement, sell this Warrant without registration under the Securities Act within the limitation of
the exemptions provided by (A) Rule 144 under the Securities Act, as such rule may be amended from
time to time, or (B) any successor rule or regulation hereafter adopted by the SEC. Upon the
written request of any Warrantholder, the Company will deliver to such Warrantholder a written
statement that it has complied with such requirements.

     13. Adjustments and Other Rights. The Exercise Price and the number of Shares issuable
upon exercise of this Warrant shall be subject to adjustment from time to time as follows;
provided, that if more than one subsection of this Section 13 is applicable to a single event, the
subsection shall be applied that produces the largest adjustment and no single event shall cause an
adjustment under more than one subsection of this Section 13 so as to result in duplication:

     (A) Stock Splits, Subdivisions, Reclassifications or Combinations. If the Company
shall (i) declare and pay a dividend or make a distribution on its Common Stock in shares of Common
Stock, (ii) subdivide or reclassify the outstanding shares of Common Stock into a greater number of
shares, or (iii) combine or reclassify the outstanding shares of Common Stock into a smaller number
of shares, the number of Shares issuable upon exercise of this Warrant at the time of the record
date for such dividend or distribution or the effective date of such subdivision, combination or
reclassification shall be proportionately adjusted so that the Warrantholder after such date shall
be entitled to purchase the number of shares of Common Stock which such holder would have owned or
been entitled to receive in respect of the shares of Common Stock subject to this Warrant after
such date had this Warrant been exercised immediately prior to such date. In such event, the
Exercise Price in effect at the time of the record date for such dividend or distribution or the
effective date of such subdivision, combination or reclassification shall be adjusted to the number
obtained by dividing (x) the product of (1) the number of Shares issuable upon the exercise of this
Warrant before such adjustment and (2) the Exercise Price in effect immediately prior to the record
or effective date, as the case may be, for the dividend, distribution, subdivision, combination or
reclassification giving rise to this adjustment by (y) the new number of Shares issuable upon
exercise of the Warrant determined pursuant to the immediately preceding sentence.

     (B) Certain Issuances of Common Shares or Convertible Securities. Until the earlier of
(i) the date on which the Original Warrantholder no longer holds this Warrant or any portion
thereof and (ii) the third anniversary of the Issue Date, if the Company shall issue shares of
Common Stock (or rights or warrants or other securities exercisable or convertible into or
exchangeable (collectively, a “conversion”) for shares of Common Stock) (collectively, “convertible
securities”) (other than in Permitted Transactions (as defined below) or a transaction to which
subsection (A) of this Section 13 is applicable) without consideration or at a consideration per
share (or having a conversion price per share) that is less than 90% of the Market Price on the
last trading day preceding the date of the agreement on pricing such shares (or such convertible
securities) then, in such event:

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(A) the number of Shares issuable upon the exercise of this Warrant immediately prior to the
date of the agreement on pricing of such shares (or of such convertible securities) (the
“Initial Number”) shall be increased to the number obtained by multiplying the Initial
Number by a fraction (A) the numerator of which shall be the sum of (x) the number of shares
of Common Stock of the Company outstanding on such date and (y) the number of additional
shares of Common Stock issued (or into which convertible securities may be exercised or
convert) and (B) the denominator of which shall be the sum of (I) the number of shares of
Common Stock outstanding on such date and (II) the number of shares of Common Stock which
the aggregate consideration receivable by the Company for the total number of shares of
Common Stock so issued (or into which convertible securities may be exercised or convert)
would purchase at the Market Price on the last trading day preceding the date of the
agreement on pricing such shares (or such convertible securities); and

(B) the Exercise Price payable upon exercise of the Warrant shall be adjusted by multiplying
such Exercise Price in effect immediately prior to the date of the agreement on pricing of
such shares (or of such convertible securities) by a fraction, the numerator of which shall
be the number of shares of Common Stock issuable upon exercise of this Warrant prior to such
date and the denominator of which shall be the number of shares of Common Stock issuable
upon exercise of this Warrant immediately after the adjustment described in clause (A)
above.

     For purposes of the foregoing, the aggregate consideration receivable by the Company in
connection with the issuance of such shares of Common Stock or convertible securities shall be
deemed to be equal to the sum of the net offering price (including the Fair Market Value of any
non-cash consideration and after deduction of any related expenses payable to third parties) of all
such securities plus the minimum aggregate amount, if any, payable upon exercise or conversion of
any such convertible securities into shares of Common Stock; and “Permitted Transactions” shall
mean issuances (i) as consideration for or to fund the acquisition of businesses and/or related
assets, (ii) in connection with employee benefit plans and compensation related arrangements in the
ordinary course and consistent with past practice approved by the Board of Directors, (iii) in
connection with a public or broadly marketed offering and sale of Common Stock or convertible
securities for cash conducted by the Company or its affiliates pursuant to registration under the
Securities Act or Rule 144A thereunder on a basis consistent with capital raising transactions by
comparable financial institutions and (iv) in connection with the exercise of preemptive rights on
terms existing as of the Issue Date. Any adjustment made pursuant to this Section 13(B) shall
become effective immediately upon the date of such issuance.

     (C) Other Distributions. In case the Company shall fix a record date for the making of
a distribution to all holders of shares of its Common Stock of securities, evidences of
indebtedness, assets, cash, rights or warrants (excluding Ordinary Cash Dividends, dividends of its
Common Stock and other dividends or distributions referred to in Section 13(A)), in each such case,
the Exercise Price in effect prior to such record date shall be reduced immediately thereafter to
the price determined by multiplying the Exercise Price in effect immediately prior to the reduction
by the quotient of (x) the Market Price of the Common Stock on the last trading day preceding the
first date on which the Common Stock trades regular way on the principal

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national securities exchange on which the Common Stock is listed or admitted to trading without the
right to receive such distribution, minus the amount of cash and/or the Fair Market Value of the
securities, evidences of indebtedness, assets, rights or warrants to be so distributed in respect
of one share of Common Stock (such amount and/or Fair Market Value, the “Per Share Fair Market
Value”) divided by (y) such Market Price on such date specified in clause (x); such adjustment
shall be made successively whenever such a record date is fixed. In such event, the number of
Shares issuable upon the exercise of this Warrant shall be increased to the number obtained by
dividing (x) the product of (1) the number of Shares issuable upon the exercise of this Warrant
before such adjustment, and (2) the Exercise Price in effect immediately prior to the distribution
giving rise to this adjustment by (y) the new Exercise Price determined in accordance with the
immediately preceding sentence. In the case of adjustment for a cash dividend that is, or is
coincident with, a regular quarterly cash dividend, the Per Share Fair Market Value would be
reduced by the per share amount of the portion of the cash dividend that would constitute an
Ordinary Cash Dividend. In the event that such distribution is not so made, the Exercise Price and
the number of Shares issuable upon exercise of this Warrant then in effect shall be readjusted,
effective as of the date when the Board of Directors determines not to distribute such shares,
evidences of indebtedness, assets, rights, cash or warrants, as the case may be, to the Exercise
Price that would then be in effect and the number of Shares that would then be issuable upon
exercise of this Warrant if such record date had not been fixed.

     (D) Certain Repurchases of Common Stock. In case the Company effects a Pro Rata
Repurchase of Common Stock, then the Exercise Price shall be reduced to the price determined by
multiplying the Exercise Price in effect immediately prior to the Effective Date of such Pro Rata
Repurchase by a fraction of which the numerator shall be (i) the product of (x) the number of
shares of Common Stock outstanding immediately before such Pro Rata Repurchase and (y) the Market
Price of a share of Common Stock on the trading day immediately preceding the first public
announcement by the Company or any of its Affiliates of the intent to effect such Pro Rata
Repurchase, minus (ii) the aggregate purchase price of the Pro Rata Repurchase, and of which the
denominator shall be the product of (i) the number of shares of Common Stock outstanding
immediately prior to such Pro Rata Repurchase minus the number of shares of Common Stock so
repurchased and (ii) the Market Price per share of Common Stock on the trading day immediately
preceding the first public announcement by the Company or any of its Affiliates of the intent to
effect such Pro Rata Repurchase. In such event, the number of shares of Common Stock issuable upon
the exercise of this Warrant shall be increased to the number obtained by dividing (x) the product
of (1) the number of Shares issuable upon the exercise of this Warrant before such adjustment, and
(2) the Exercise Price in effect immediately prior to the Pro Rata Repurchase giving rise to this
adjustment by (y) the new Exercise Price determined in accordance with the immediately preceding
sentence. For the avoidance of doubt, no increase to the Exercise Price or decrease in the number
of Shares issuable upon exercise of this Warrant shall be made pursuant to this Section 13(D).

     (E) Business Combinations. In case of any Business Combination or reclassification of
Common Stock (other than a reclassification of Common Stock referred to in Section 13(A)), the
Warrantholder’s right to receive Shares upon exercise of this Warrant shall be converted into the
right to exercise this Warrant to acquire the number of shares of stock or other securities or

10

 

UST Sequence Number: 114

property (including cash) which the Common Stock issuable (at the time of such Business
Combination or reclassification) upon exercise of this Warrant immediately prior to such Business
Combination or reclassification would have been entitled to receive upon consummation of such
Business Combination or reclassification; and in any such case, if necessary, the provisions set
forth herein with respect to the rights and interests thereafter of the Warrantholder shall be
appropriately adjusted so as to be applicable, as nearly as may reasonably be, to the
Warrantholder’s right to exercise this Warrant in exchange for any shares of stock or other
securities or property pursuant to this paragraph. In determining the kind and amount of stock,
securities or the property receivable upon exercise of this Warrant following the consummation of
such Business Combination, if the holders of Common Stock have the right to elect the kind or
amount of consideration receivable upon consummation of such Business Combination, then the
consideration that the Warrantholder shall be entitled to receive upon exercise shall be deemed to
be the types and amounts of consideration received by the majority of all holders of the shares of
common stock that affirmatively make an election (or of all such holders if none make an election).

     (F) Rounding of Calculations; Minimum Adjustments. All calculations under this Section
13 shall be made to the nearest one-tenth (1/10th) of a cent or to the nearest onehundredth
(1/100th) of a share, as the case may be. Any provision of this Section 13 to the contrary
notwithstanding, no adjustment in the Exercise Price or the number of Shares into which this
Warrant is exercisable shall be made if the amount of such adjustment would be less than $0.01 or
one-tenth (1/10th) of a share of Common Stock, but any such amount shall be carried forward and an
adjustment with respect thereto shall be made at the time of and together with any subsequent
adjustment which, together with such amount and any other amount or amounts so carried forward,
shall aggregate $0.01 or 1/10th of a share of Common Stock, or more.

     (G) Timing of Issuance of Additional Common Stock Upon Certain Adjustments. In any
case in which the provisions of this Section 13 shall require that an adjustment shall become
effective immediately after a record date for an event, the Company may defer until the occurrence
of such event (i) issuing to the Warrantholder of this Warrant exercised after such record date and
before the occurrence of such event the additional shares of Common Stock issuable upon such
exercise by reason of the adjustment required by such event over and above the shares of Common
Stock issuable upon such exercise before giving effect to such adjustment and (ii) paying to such
Warrantholder any amount of cash in lieu of a fractional share of Common Stock; provided, however,
that the Company upon request shall deliver to such Warrantholder a due bill or other appropriate
instrument evidencing such Warrantholder’s right to receive such additional shares, and such cash,
upon the occurrence of the event requiring such adjustment.

     (H) Completion of Qualified Equity Offering. In the event the Company (or any
successor by Business Combination) completes one or more Qualified Equity Offerings on or prior to
December 31, 2009 that result in the Company (or any such successor ) receiving aggregate gross
proceeds of not less than 100% of the aggregate liquidation preference of the Preferred Shares (and
any preferred stock issued by any such successor to the Original Warrantholder under the CPP), the
number of shares of Common Stock underlying the portion of this Warrant then held by the Original
Warrantholder shall be thereafter reduced by a number of

11

 

UST Sequence Number: 114

shares of Common Stock equal to the product of (i) 0.5 and (ii) the number of shares
underlying the Warrant on the Issue Date (adjusted to take into account all other theretofore made
adjustments pursuant to this Section 13).

     (I) Other Events. For so long as the Original Warrantholder holds this Warrant or any
portion thereof, if any event occurs as to which the provisions of this Section 13 are not strictly
applicable or, if strictly applicable, would not, in the good faith judgment of the Board of
Directors of the Company, fairly and adequately protect the purchase rights of the Warrants in
accordance with the essential intent and principles of such provisions, then the Board of Directors
shall make such adjustments in the application of such provisions, in accordance with such
essential intent and principles, as shall be reasonably necessary, in the good faith opinion of the
Board of Directors, to protect such purchase rights as aforesaid. The Exercise Price or the number
of Shares into which this Warrant is exercisable shall not be adjusted in the event of a change in
the par value of the Common Stock or a change in the jurisdiction of incorporation of the Company.

     (J) Statement Regarding Adjustments. Whenever the Exercise Price or the number of
Shares into which this Warrant is exercisable shall be adjusted as provided in Section 13, the
Company shall forthwith file at the principal office of the Company a statement showing in
reasonable detail the facts requiring such adjustment and the Exercise Price that shall be in
effect and the number of Shares into which this Warrant shall be exercisable after such adjustment,
and the Company shall also cause a copy of such statement to be sent by mail, first class postage
prepaid, to each Warrantholder at the address appearing in the Company’s records.

     (K) Notice of Adjustment Event. In the event that the Company shall propose to take
any action of the type described in this Section 13 (but only if the action of the type described
in this Section 13 would result in an adjustment in the Exercise Price or the number of Shares into
which this Warrant is exercisable or a change in the type of securities or property to be delivered
upon exercise of this Warrant), the Company shall give notice to the Warrantholder, in the manner
set forth in Section 13(J), which notice shall specify the record date, if any, with respect to any
such action and the approximate date on which such action is to take place. Such notice shall also
set forth the facts with respect thereto as shall be reasonably necessary to indicate the effect on
the Exercise Price and the number, kind or class of shares or other securities or property which
shall be deliverable upon exercise of this Warrant. In the case of any action which would require
the fixing of a record date, such notice shall be given at least 10 days prior to the date so
fixed, and in case of all other action, such notice shall be given at least 15 days prior to the
taking of such proposed action. Failure to give such notice, or any defect therein, shall not
affect the legality or validity of any such action.

     (L) Proceedings Prior to Any Action Requiring Adjustment. As a condition precedent to
the taking of any action which would require an adjustment pursuant to this Section 13, the Company
shall take any action which may be necessary, including obtaining regulatory, New York Stock
Exchange, NASDAQ Stock Market or other applicable national securities exchange or stockholder
approvals or exemptions, in order that the Company may thereafter validly and legally issue as
fully paid and nonassessable all shares of Common Stock that the Warrantholder is entitled to
receive upon exercise of this Warrant pursuant to this Section 13.

12

 

UST Sequence Number: 114

     (M) Adjustment Rules. Any adjustments pursuant to this Section 13 shall be made
successively whenever an event referred to herein shall occur. If an adjustment in Exercise Price
made hereunder would reduce the Exercise Price to an amount below par value of the Common Stock,
then such adjustment in Exercise Price made hereunder shall reduce the Exercise Price to the par
value of the Common Stock.

     14. Exchange. At any time following the date on which the shares of Common Stock of
the Company are no longer listed or admitted to trading on a national securities exchange (other
than in connection with any Business Combination), the Original Warrantholder may cause the Company
to exchange all or a portion of this Warrant for an economic interest (to be determined by the
Original Warrantholder after consultation with the Company) of the Company classified as permanent
equity under U.S. GAAP having a value equal to the Fair Market Value of the portion of the Warrant
so exchanged. The Original Warrantholder shall calculate any Fair Market Value required to be
calculated pursuant to this Section 14, which shall not be subject to the Appraisal Procedure.

     15. No Impairment. The Company will not, by amendment of its Charter or through any
reorganization, transfer of assets, consolidation, merger, dissolution, issue or sale of securities
or any other voluntary action, avoid or seek to avoid the observance or performance of any of the
terms to be observed or performed hereunder by the Company, but will at all times in good faith
assist in the carrying out of all the provisions of this Warrant and in taking of all such action
as may be necessary or appropriate in order to protect the rights of the Warrantholder.

     16. Governing Law. This Warrant will be governed by and construed in accordance with
the federal law of the United States if and to the extent such law is applicable, and otherwise in
accordance with the laws of the State of New York applicable to contracts made and to be performed
entirely within such State. Each of the Company and the Warrantholder agrees (a) to submit to the
exclusive jurisdiction and venue of the United States District Court for the District of Columbia
for any civil action, suit or proceeding arising out of or relating to this Warrant or the
transactions contemplated hereby, and (b) that notice may be served upon the Company at the address
in Section 20 below and upon the Warrantholder at the address for the Warrantholder set forth in
the registry maintained by the Company pursuant to Section 9 hereof. To the extent permitted by
applicable law, each of the Company and the Warrantholder hereby unconditionally waives trial by
jury in any civil legal action or proceeding relating to the Warrant or the transactions
contemplated hereby or thereby.

     17. Binding Effect. This Warrant shall be binding upon any successors or assigns of
the Company.

     18. Amendments. This Warrant may be amended and the observance of any term of this
Warrant may be waived only with the written consent of the Company and the Warrantholder.

     19. Prohibited Actions. The Company agrees that it will not take any action which
would entitle the Warrantholder to an adjustment of the Exercise Price if the total number of
shares of Common Stock issuable after such action upon exercise of this Warrant, together with

13

 

UST Sequence Number: 114

all shares of Common Stock then outstanding and all shares of Common Stock then issuable upon the
exercise of all outstanding options, warrants, conversion and other rights, would exceed the total
number of shares of Common Stock then authorized by its Charter.

     20. Notices. Any notice, request, instruction or other document to be given hereunder
by any party to the other will be in writing and will be deemed to have been duly given (a) on the
date of delivery if delivered personally, or by facsimile, upon confirmation of receipt, or (b) on
the second business day following the date of dispatch if delivered by a recognized next day
courier service. All notices hereunder shall be delivered as set forth in Item 8 of Schedule A
hereto, or pursuant to such other instructions as may be designated in writing by the party to
receive such notice.

     21. Entire Agreement. This Warrant, the forms attached hereto and Schedule A hereto
(the terms of which are incorporated by reference herein), and the Letter Agreement (including all
documents incorporated therein), contain the entire agreement between the parties with respect to
the subject matter hereof and supersede all prior and contemporaneous arrangements or undertakings
with respect thereto.

[Remainder of page intentionally left blank]

14

 

UST Sequence Number: 114

[Form of Notice of Exercise]

Date:                          

TO: [Company]

RE: Election to Purchase Common Stock

     The undersigned, pursuant to the provisions set forth in the attached Warrant, hereby agrees
to subscribe for and purchase the number of shares of the Common Stock set forth below covered by
such Warrant. The undersigned, in accordance with Section 3 of the Warrant, hereby agrees to pay
the aggregate Exercise Price for such shares of Common Stock in the manner set forth below. A new
warrant evidencing the remaining shares of Common Stock covered by such Warrant, but not yet
subscribed for and purchased, if any, should be issued in the name set forth below.

Number of Shares of Common Stock                                         

Method of Payment of Exercise Price (note if cashless exercise pursuant to Section 3(i) of the
Warrant or cash exercise pursuant to Section 3(ii) of the Warrant, with consent of the Company
and the Warrantholder)                                                             

Aggregate Exercise Price:                                                             

	 	 	 	 	 	 	 
	 

	 	Holder:
	 	 	 	 
	 

	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	 	 	 	 	 
	 

	 	Name:	 	 	 	 
	 

	 	 	 	 	 	 
	 

	 	Title:	 	 	 	 
	 

	 	 	 	 	 	 

15

 

UST Sequence Number: 114

     IN WITNESS WHEREOF, the Company has caused this Warrant to be duly executed by
a duly authorized officer.

Dated:                                         

	 	 	 	 	 
	 	COMPANY:                                         

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 

	 	 	 	 	 
	 	Attest:

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 

[Signature Page to Warrant]

16

 

UST Sequence Number: 114

SCHEDULE A

Item 1

Name:

Corporate or other organizational form:

Jurisdiction of organization:

Item 2

Exercise Price: 2

Item 3

Issue Date:

Item 4

Amount of last dividend declared prior to the Issue Date:

Item 5

Date of Letter Agreement between the Company and the United States Department of the
Treasury:

Item 6

Number of shares of Common Stock:

Item 7

Company’s address:

Item 8

Notice information:

 

			
	2	 	Initial exercise price to be calculated based on the
average of closing prices of the Common Stock on the 20 trading days ending on
the last trading day prior to the date the Company’s application for
participation in the Capital Purchase Program was approved by the United States
Department of the Treasury.

 

 

UST Sequence Number: 114

SCHEDULE A

ADDITIONAL TERMS AND CONDITIONS

	 	 	 	 	 
	Company Information:
	 	 	 	 
	 
	 	 	 	 
	Name of the Company:
	 	Southwest Bancorp, Inc.
	 
	 	 	 	 
	Corporate or other organizational form:
	 	Corporation
	 
	 	 	 	 
	Jurisdiction of Organization:
	 	Oklahoma
	 
	 	 	 	 
	Appropriate Federal Banking Agency:
	 	Board of Governors of the Federal Reserve System
	 
	 	 	 	 
	Notice Information:
	 	 	 	 
	 
	 	 	 	 
	 	 	Southwest Bancorp, Inc.
	 	 	608 South Main Street
	 	 	Stillwater, Oklahoma 74074
	 
	 	Attention:	 	Rick Green
	 
	 	 	 	President and Chief Executive
	 
	 	 	 	Officer
	 
	 	Copy to:	 	Kerby E. Crowell
	 
	 	 	 	Executive Vice President, Chief Financial
	 
	 	 	 	Officer and Secretary
	 
	 	 	 	 
	Terms of the Purchase:
	 	 	 	 
	 
	 	 	 	 
	Series of
Preferred Stock Purchased:
	 	Fixed Rate Cumulative Perpetual Preferred Stock,
	 	 	Series B
	 
	 	 	 	 
	Per
Share Liquidation Preference of Preferred Stock:
	 	$1,000	 	 
	 
	 	 	 	 
	Number of Shares of Preferred Stock Purchased:
	 	70,000	 	 
	 
	 	 	 	 
	Dividend Payment Dates on the Preferred Stock:
	 	February 15, May 15, August 15 and
	 
	 	November 15
	 
	 	 	 	 
	Number of Initial Warrant Shares:
	 	703,753
	 
	 	 	 	 
	Exercise Price of the Warrant:
	 	$14.92
	 
	 	 	 	 
	Purchase Price:
	 	$70,000,000
	 
	 	 	 	 
	Closing:
	 	 	 	 
	 
	 	 	 	 
	Location of Closing:
	 	Squire, Sanders & Dempsey L.L.P.
	 
	 	200 S Biscayne Blvd., Suite 4000
	 
	 	Miami, FL  33131
	 
	 	 	 	 
	Time of Closing:
	 	9:00 EST
	 
	 	 	 	 
	Date of Closing:
	 	December 5, 2008

(continued)

 

 

UST Sequence Number: 114

	 	 	 
	     Wire Information for Closing:
	 	ABA Number: 103101437
	 
	 	Bank: Stillwater National Bank and Trust Company
	 
	 	Account Name: Southwest Bancorp, Inc.
	 
	 	Account Number: [Intentionally omitted]
	 
	 	Beneficiary: n/a

 

 

UST Sequence Number: 114

SCHEDULE B

CAPITALIZATION

	 	 	 
	Capitalization Date: November 30, 2008
	 	 
	 
	 	 
	Common Stock
	 	 
	 
	 	 
	Par value:
	 	$1.00
	Total Authorized:
	 	20,000,000 shares
	Outstanding:
	 	14,658, 042 (includes 300,833 shares held in treasury)
	Subject to warrants, options, convertible
securities, etc.:
	 	1,541,812
	Reserved for benefit plans and other
issuances:
	 	425,925
	Remaining authorized but unissued:
	 	3,374,221
	Shares issued after Capitalization Date

(other than pursuant to warrants, options,
convertible securities, etc. as set forth
above):
	 	None
	 
	 	 
	Preferred Stock
	 	 
	Par value:
	 	$1.00
	Total Authorized:
	 	2,000,000 (1,000,000 each for two classes)
	Outstanding (by series):
	 	None
	Reserved for issuance:
	 	Serial Preferred Stock-None (690,000 shares previously issued and redeemed)
	 
	 	Class B Serial Preferred Stock— approximately 50,000 shares reserved in connection with shareholder rights plan
	 
	Remaining authorized but unissued:
	 	Serial Preferred Stock (from which the Preferred Shares will be issued)—310,000 shares
	 
	 	Class B Serial Preferred Stock-approximately 950,000 shares

 

 

UST Sequence Number: 114

SCHEDULE C

REQUIRED STOCKHOLDER APPROVALS

	 	 	 	 	 	 	 	 	 
	 	 	Required3	 	 	% Vote Required	 
	Warrants — Common Stock Issuance
	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	Charter Amendment
	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	Stock Exchange Rules
	 	 	 	 	 	 	 	 

If no
stockholder approvals are required, please so indicate by checking the box: þ.

 

			
	3	 	If stockholder approval is required, indicate applicable class/series of capital stock that are required to vote.

 

 

UST Sequence Number: 114

SCHEDULE D

LITIGATION

List any exceptions to the representation and warranty in Section 2.2(l) of the Securities Purchase
Agreement – Standard Terms.

If none,
please so indicate by checking the box: þ.

 

 

UST Sequence Number: 114

SCHEDULE E

COMPLIANCE WITH LAWS

List any exceptions to the representation and warranty in the second sentence of Section 2.2(m) of
the Securities Purchase Agreement – Standard Terms.

If none,
please so indicate by checking the box: þ.

List any exceptions to the representation and warranty in the last sentence of Section 2.2(m) of
the Securities Purchase Agreement – Standard Terms.

If none,
please so indicate by checking the box: þ.

 

 

UST Sequence Number: 114

SCHEDULE F

REGULATORY AGREEMENTS

List any exceptions to the representation and warranty in Section 2.2(s) of the Securities Purchase
Agreement – Standard Terms.

If none,
please so indicate by checking the box:
þ.EX-4.1

Exhibit 4.1

  

 

K. HOVNANIAN ENTERPRISES, INC.,

as Issuer

HOVNANIAN ENTERPRISES, INC.

and

the other Guarantors party hereto

and

WILMINGTON TRUST COMPANY,

as Trustee

 

Indenture

Dated as of December 3, 2008

 

18.0% Senior Secured Notes Due 2017

 

  

 

 

CROSS-REFERENCE TABLE

	 	 	 	 	 	 	 	 	 
	TIA Sections	 	Indenture Sections
	310

	 	(a)
	 	 	 	 	 	7.10 
	 

	 	(b)
	 	 	 	 	 	7.03, 7.08(a)(iii), 7.08(e) 
	 

	 	(c)
	 	 	 	 	 	Inapplicable 
	311

	 	 	 	 	 	 	 	7.03 
	312

	 	(a)
	 	 	 	 	 	13.02 
	313

	 	(a)
	 	 	 	 	 	7.06 
	 

	 	(c)
	 	 	 	 	 	5.10(b), 7.06 
	314

	 	(a)
	 	 	 	 	 	4.15(c), 4.16(c) 
	 

	 	(b)
	 	 	 	 	 	6.10, 11.05(a), 13.01 
	 

	 	(c)
	 	 	 	 	 	Inapplicable 
	 

	 	(d)
	 	 	 	 	 	6.10, 11.05(a), 11.05(b), 13.01 
	 

	 	(e)
	 	 	 	 	 	Inapplicable 
	 

	 	(f)
	 	 	 	 	 	Inapplicable 
	315

	 	(a)
	 	 	 	 	 	7.02 
	 

	 	(b)
	 	 	 	 	 	7.02 
	 

	 	(c)
	 	 	 	 	 	7.02 
	 

	 	(d)
	 	 	 	 	 	7.02 
	 

	 	(e)
	 	 	 	 	 	Inapplicable 
	316

	 	(a)
	 	 	 	 	 	Inapplicable 
	 

	 	(b)
	 	 	 	 	 	Inapplicable 
	 

	 	(c)
	 	 	 	 	 	13.02(d) 
	317

	 	(a)
	(1)	 	 	 	 	Inapplicable 
	 

	 	(a)
	(2)	 		 	 	Inapplicable 
	 

	 	(b)
	 	 	 	 	 	Inapplicable 
	318

	 	 	 	 	 	 	 	Inapplicable 

i

 

TABLE OF CONTENTS

 

	 	 	 	 	 
	 	 	Page
	RECITALS
	 	 	 	 
	 
	 	 	 	 
	ARTICLE 1
	 	 	 	 
	 Definitions and Incorporation by Reference
	 	 	 	 
	 
	 	 	 	 
	Section 1.01. Definitions
	 	 	2	 
	Section 1.02. Rules of Construction
	 	 	33	 
	 
	 	 	 	 
	ARTICLE 2
	 	 	 	 
	 The Notes
	 	 	 	 
	 
	 	 	 	 
	Section 2.01. Form, Dating and Denominations; Legends
	 	 	33	 
	Section 2.02. Execution and Authentication; Exchange Notes; Additional Notes
	 	 	35	 
	Section 2.03. Registrar, Paying Agent and Authenticating Agent; Paying Agent to Hold Money in Trust
	 	 	36	 
	Section 2.04. Replacement Notes
	 	 	37	 
	Section 2.05. Outstanding Notes
	 	 	37	 
	Section 2.06. Temporary Notes
	 	 	38	 
	Section 2.07. Cancellation
	 	 	38	 
	Section 2.08. CUSIP and ISIN Numbers
	 	 	38	 
	Section 2.09. Registration, Transfer and Exchange
	 	 	38	 
	Section 2.10. Restrictions on Transfer and Exchange
	 	 	42	 
	Section 2.11. Regulation S Temporary Global Notes
	 	 	44	 
	 
	 	 	 	 
	ARTICLE 3 
	 	 	 	 
	 Redemption; Offer to Purchase
	 	 	 	 
	 
	 	 	 	 
	Section 3.01. Optional Redemption
	 	 	45	 
	Section 3.02. Redemption with Proceeds of Equity Offering
	 	 	45	 
	Section 3.03. Sinking Fund; Mandatory Redemption
	 	 	45	 
	Section 3.04. Method and Effect of Redemption
	 	 	45	 
	Section 3.05. Offer to Purchase
	 	 	47	 
	 
	 	 	 	 
	ARTICLE 4
	 	 	 	 
	 Covenants
	 	 	 	 
	 
	 	 	 	 
	Section 4.01. Payment of Notes
	 	 	49	 
	Section 4.02. Maintenance of Office or Agency
	 	 	50	 

ii

 

	 	 	 	 	 
	 	 	Page
	Section 4.03. Existence
	 	 	50	 
	Section 4.04. Payment of Taxes and Other Claims
	 	 	51	 
	Section 4.05. Maintenance of Properties and Insurance
	 	 	51	 
	Section 4.06. Limitations on Indebtedness
	 	 	51	 
	Section 4.07. Limitations on Restricted Payments
	 	 	52	 
	Section 4.08. Limitations on Liens
	 	 	56	 
	Section 4.09. Limitations on Restrictions Affecting Restricted Subsidiaries
	 	 	56	 
	Section 4.10. Limitations on Dispositions of Assets
	 	 	58	 
	Section 4.11. Guarantees by Restricted Subsidiaries
	 	 	60	 
	Section 4.12. Repurchase of Notes upon a Change of Control
	 	 	60	 
	Section 4.13. Limitations on Transactions with Affiliates
	 	 	61	 
	Section 4.14. Limitations on Mergers, Consolidations and Sales of Assets
	 	 	63	 
	Section 4.15. Reports to Holders of Notes
	 	 	64	 
	Section 4.16. Reports to Trustee
	 	 	64	 
	Section 4.17. Notice of Other Defaults
	 	 	65	 
	Section 4.18. Further Assurances; Costs
	 	 	65	 
	 
	 	 	 	 
	ARTICLE 5
	 	 	 	 
	 Remedies
	 	 	 	 
	 
	 	 	 	 
	Section 5.01. Events of Default
	 	 	68	 
	Section 5.02. Other Remedies
	 	 	72	 
	Section 5.03. Waiver of Defaults by Majority of Holders
	 	 	72	 
	Section 5.04. Direction of Proceedings
	 	 	72	 
	Section 5.05. Application of Moneys Collected by Trustee
	 	 	72	 
	Section 5.06. Proceedings by Holders
	 	 	73	 
	Section 5.07. Proceedings by Trustee
	 	 	74	 
	Section 5.08. Remedies Cumulative and Continuing
	 	 	74	 
	Section 5.09. Undertaking to Pay Costs
	 	 	75	 
	Section 5.10. Notice of Defaults
	 	 	75	 
	Section 5.11. Waiver of Stay, Extension or Usury Laws
	 	 	76	 
	Section 5.12. Trustee May File Proof of Claim
	 	 	76	 
	Section 5.13. Payment of Notes on Default; Suit Therefor
	 	 	76	 
	 
	 	 	 	 
	ARTICLE 6
	 	 	 	 
	 Guarantees; Release of Guarantor
	 	 	 	 
	 
	 	 	 	 
	Section 6.01. Guarantee
	 	 	78	 
	Section 6.02. Obligations of each Guarantor Unconditional
	 	 	79	 
	Section 6.03. Release of a Guarantor
	 	 	80	 
	Section 6.04. Execution and Delivery of Guarantee
	 	 	80	 
	Section 6.05. Limitation on Guarantor Liability
	 	 	80	 
	Section 6.06. Article 6 not to Prevent Events of Default
	 	 	81	 
	Section 6.07. Waiver by the Guarantors
	 	 	81	 
	Section 6.08. Subrogation and Contribution
	 	 	81	 
	Section 6.09. Stay of Acceleration
	 	 	81	 

iii

 

	 	 	 	 	 
	 	 	Page
	Section 6.10. Guarantors as “obligors” for Provisions Included in the Indenture Pursuant to the Trust Indenture Act
	 	 	81	 
	 
	 	 	 	 
	ARTICLE 7 
	 	 	 	 
	 The Trustee 
	 	 	 	 
	 
	 	 	 	 
	Section 7.01. General
	 	 	82	 
	Section 7.02. Certain Rights of the Trustee
	 	 	82	 
	Section 7.03. Individual Rights of the Trustee
	 	 	83	 
	Section 7.04. Trustee’s Disclaimer
	 	 	84	 
	Section 7.05. Reserved
	 	 	84	 
	Section 7.06. Reports by Trustee to Holders
	 	 	84	 
	Section 7.07. Compensation and Indemnity
	 	 	84	 
	Section 7.08. Replacement of Trustee
	 	 	85	 
	Section 7.09. Successor Trustee by Merger
	 	 	86	 
	Section 7.10. Eligibility
	 	 	86	 
	Section 7.11. Money Held in Trust
	 	 	86	 
	 
	 	 	 	 
	ARTICLE 8
	 	 	 	 
	 Defeasance and Discharge
	 	 	 	 
	 
	 	 	 	 
	Section 8.01. Legal Defeasance and Discharge
	 	 	87	 
	Section 8.02. Covenant Defeasance
	 	 	87	 
	Section 8.03. Conditions to Legal or Covenant Defeasance
	 	 	88	 
	Section 8.04. Deposited Money and Government Securities to be
Held in Trust; Other Miscellaneous Provisions
	 	 	89	 
	Section 8.05. Repayment to Issuer
	 	 	90	 
	Section 8.06. Reinstatement
	 	 	90	 
	Section 8.07. Survival
	 	 	91	 
	Section 8.08. Satisfaction and Discharge of Indenture
	 	 	91	 
	 
	 	 	 	 
	ARTICLE 9
	 	 	 	 
	 Amendments, Supplements and Waivers 
	 	 	 	 
	 
	 	 	 	 
	Section 9.01. Amendments Without Consent of Holders
	 	 	92	 
	Section 9.02. Amendments with Consent of Holders
	 	 	93	 
	Section 9.03. Effect of Consent
	 	 	95	 
	Section 9.04. Trustee’s Rights and Obligations
	 	 	95	 
	Section 9.05. Conformity with Trust Indenture Act
	 	 	95	 
	Section 9.06. Payments for Consents
	 	 	95	 
	 
	 	 	 	 
	ARTICLE 10 
	 	 	 	 
	 Ranking of Liens 
	 	 	 	 
	 
	 	 	 	 
	Section 10.01. Agreement for the Benefit of Holders of
First Priority Liens and Second Priority Liens
	 	 	96	 

iv

 

	 	 	 	 	 
	 	 	Page
	Section 10.02. Notes, Guarantees and
Other Third Priority Lien Obligations
not Subordinated
	 	 	97	 
	Section 10.03. Relative Rights
	 	 	97	 
	 
	 	 	 	 
	ARTICLE 11 
	 	 	 	 
	 Collateral and Security 
	 	 	 	 
	 
	 	 	 	 
	Section 11.01. Security Documents
	 	 	99	 
	Section 11.02. Collateral Agent
	 	 	99	 
	Section 11.03. Authorization of Actions to be Taken
	 	 	100	 
	Section 11.04. Release of Third-Priority Liens
	 	 	102	 
	Section 11.05. Filing, Recording and Opinions
	 	 	103	 
	 
	 	 	 	 
	ARTICLE 12
	 	 	 	 
	 Release of Issuer and Guarantors 
	 	 	 	 
	 
	 	 	 	 
	Section 12.01. Release of Issuer
	 	 	104	 
	 
	 	 	 	 
	ARTICLE 13
	 	 	 	 
	 Miscellaneous 
	 	 	 	 
	 
	 	 	 	 
	Section 13.01. Trust Indenture Act of 1939
	 	 	104	 
	Section 13.02. Holder Communications; Holder Actions
	 	 	105	 
	Section 13.03. Notices
	 	 	105	 
	Section 13.04. Certificate and Opinion as to Conditions Precedent
	 	 	106	 
	Section 13.05. Statements Required in Certificate or Opinion
	 	 	107	 
	Section 13.06. Payment Date Other Than a Business Day
	 	 	108	 
	Section 13.07. Governing Law
	 	 	108	 
	Section 13.08. No Adverse Interpretation of Other Agreements
	 	 	108	 
	Section 13.09. Successors
	 	 	108	 
	Section 13.10. Duplicate Originals
	 	 	108	 
	Section 13.11. Separability
	 	 	108	 
	Section 13.12. Table of Contents and Headings
	 	 	108	 
	Section 13.13. No Liability of Directors, Officers, Employees, Partners, Incorporators and Stockholders
	 	 	109	 
	Section 13.14. Provisions of Indenture for the Sole Benefit of Parties and Holders of Notes
	 	 	109	 

v

 

EXHIBITS

	 	 	 
	EXHIBIT A

	 	Form of Note
	EXHIBIT B

	 	Form of Supplemental Indenture
	EXHIBIT C

	 	Restricted Legend
	EXHIBIT D

	 	DTC Legend
	EXHIBIT E

	 	Regulation S Certificate
	EXHIBIT F

	 	Rule 144A Certificate
	EXHIBIT G

	 	Institutional Accredited Investor Certificate
	EXHIBIT H

	 	Certificate of Beneficial Ownership
	EXHIBIT I

	 	Regulation S Temporary Global Note Legend
	EXHIBIT J

	 	Unrestricted Subsidiaries

vi

 

     INDENTURE, dated as of December 3, 2008, among K. HOVNANIAN ENTERPRISES, INC., a California
corporation (the “Issuer”), HOVNANIAN ENTERPRISES, INC., a Delaware corporation (the “Company”),
each of the other Guarantors (as defined hereafter) and WILMINGTON TRUST COMPANY, a Delaware
banking corporation, as Trustee (the “Trustee”).

RECITALS

     The Issuer has duly authorized the execution and delivery of the Indenture to provide for the
issuance of up to $29,299,000 aggregate principal amount of the Issuer’s 18.0% Senior Secured Notes
Due 2017 and, if and when issued, any Initial Additional Notes (together with any Exchange Notes
issued therefor as provided herein, the “Notes”). All things necessary to make the Indenture a
valid agreement of the Issuer, in accordance with its terms, have been done, and the Issuer has
done all things necessary to make the Notes (in the case of any Additional Notes, when duly
authorized), when duly issued and executed by the Issuer and authenticated and delivered by the
Trustee, the valid obligations of the Issuer as hereinafter provided.

     In addition, the Guarantors party hereto have duly authorized the execution and delivery of
the Indenture as guarantors of the Notes. All things necessary to make the Indenture a valid
agreement of each Guarantor, in accordance with its terms, have been done, and each Guarantor has
done all things necessary to make the Guarantees (in the case of the Guarantee of any Additional
Notes, when duly authorized), when duly issued and executed by each Guarantor and when the Notes
have been authenticated and delivered by the Trustee, the valid obligation of such Guarantor as
hereinafter provided.

     This Indenture is subject to, and will be governed by, the provisions of the Trust Indenture
Act that are required to be a part of, and govern indentures qualified under, the Trust Indenture
Act, provided that in each case the provisions of TIA §314(b) and §314(d) shall only apply
following qualification of this Indenture under the TIA.

THIS INDENTURE WITNESSETH

     For and in consideration of the premises and the purchase of the Notes by the Holders thereof,
the parties hereto covenant and agree, for the equal and proportionate benefit of all Holders, as
follows:

1

 

ARTICLE 1

Definitions and Incorporation by Reference

     Section 1.01. Definitions.

     “Acquired Indebtedness” means (a) with respect to any Person that becomes a Restricted
Subsidiary (or is merged into the Company, the Issuer or any Restricted Subsidiary) after the Issue
Date, Indebtedness of such Person or any of its Subsidiaries existing at the time such Person
becomes a Restricted Subsidiary (or is merged into the Company, the Issuer or any Restricted
Subsidiary) that was not incurred in connection with, or in contemplation of, such Person becoming
a Restricted Subsidiary (or being merged into the Company, the Issuer or any Restricted Subsidiary)
and (b) with respect to the Company, the Issuer or any Restricted Subsidiary, any Indebtedness
expressly assumed by the Company, the Issuer or any Restricted Subsidiary in connection with the
acquisition of any assets from another Person (other than the Company, the Issuer or any Restricted
Subsidiary), which Indebtedness was not incurred by such other Person in connection with or in
contemplation of such acquisition. Indebtedness incurred in connection with or in contemplation of
any transaction described in clause (a) or (b) of the preceding sentence shall be deemed to have
been incurred by the Company or a Restricted Subsidiary, as the case may be, at the time such
Person becomes a Restricted Subsidiary (or is merged into the Company, the Issuer or any Restricted
Subsidiary) in the case of clause (a) or at the time of the acquisition of such assets in the case
of clause (b), but shall not be deemed Acquired Indebtedness.

     “Additional Interest” means additional interest or liquidated damages owed to the Holders
pursuant to a Registration Rights Agreement.

     “Additional Notes” means any notes of the Issuer issued under this Indenture in addition to
the Original Notes, including any Exchange Notes issued in exchange for such Additional Notes,
having the same terms in all respects as the Original Notes, except that interest will accrue on
the Additional Notes from their date of issuance.

     “Administrative Agent” means the administrative agent under the Revolving Credit Agreement
(and any successor thereto).

     “Affiliate” means, when used with reference to a specified Person, any Person directly or
indirectly controlling, or controlled by or under direct or indirect common control with, the
Person specified.

     “Affiliate Transaction” has the meaning ascribed to it in Section 4.13 hereof.

     “Agent” means any Registrar, Paying Agent or Authenticating Agent.

     “Agent Member” means a member of, or a participant in, the Depositary.

     “Asset Acquisition” means (a) an Investment by the Company, the Issuer or any Restricted
Subsidiary in any other Person if, as a result of such Investment,

2

 

such Person shall become a Restricted Subsidiary or shall be consolidated or merged with or
into the Company, the Issuer or any Restricted Subsidiary or (b) the acquisition by the Company,
the Issuer or any Restricted Subsidiary of the assets of any Person, which constitute all or
substantially all of the assets or of an operating unit or line of business of such Person or which
is otherwise outside the ordinary course of business.

     “Asset Disposition” means any sale, transfer, conveyance, lease or other disposition
(including, without limitation, by way of merger, consolidation or sale and leaseback or sale of
shares of Capital Stock in any Subsidiary) (each, a “transaction”) by the Company, the Issuer or
any Restricted Subsidiary to any Person of any Property having a Fair Market Value in any
transaction or series of related transactions of at least $5 million. The term “Asset Disposition”
shall not include:

     (a) a transaction between the Company, the Issuer and any Restricted Subsidiary or a
transaction between Restricted Subsidiaries,

     (b) a transaction in the ordinary course of business, including, without limitation, sales
(directly or indirectly), dedications and other donations to governmental authorities, leases and
sales and leasebacks of (i) homes, improved land and unimproved land and (ii) real estate
(including related amenities and improvements),

     (c) a transaction involving the sale of Capital Stock of, or the disposition of assets in, an
Unrestricted Subsidiary,

     (d) any exchange or swap of assets of the Company, the Issuer or any Restricted Subsidiary for
assets (including Capital Stock of any Person that is or will be a Restricted Subsidiary following
receipt thereof) that (i) are to be used by the Company, the Issuer or any Restricted Subsidiary in
the ordinary course of its Real Estate Business and (ii) have a Fair Market Value not less than the
Fair Market Value of the assets exchanged or swapped (provided that (except as permitted by clause
(c) under the definition of “Permitted Investment”) to the extent that the assets exchanged or
swapped were Collateral, the assets received are pledged as Collateral under the Security Documents
substantially simultaneously with such sale, with the Lien on such assets received being of the
same priority with respect to the Notes as the Lien on the assets disposed of),

     (e) any sale, transfer, conveyance, lease or other disposition of assets and properties that
is governed by Section 4.14 hereof,

     (f) dispositions of mortgage loans and related assets and mortgage-backed securities in the
ordinary course of a mortgage lending business, or

3

 

     (g) the creation of a Permitted Lien and dispositions in connection with Permitted Liens.

     “Attributable Debt” means, with respect to any Capitalized Lease Obligations, the capitalized
amount thereof determined in accordance with GAAP.

     “Authenticating Agent” refers to a Person engaged to authenticate the Notes in the stead of
the Trustee.

     “Bankruptcy Law” means title 11 of the United States Code, as amended, or any similar federal
or state law for the relief of debtors.

     “Board of Directors” means, when used with reference to the Issuer or the Company, as the case
may be, the board of directors or any duly authorized committee of that board or any director or
directors and/or officer or officers to whom that board or committee shall have duly delegated its
authority.

     “Business Day” means any day except a Saturday, Sunday or other day on which commercial banks
in New York City or in the city where the Corporate Trust Office of the Trustee is located are
authorized or required by law or regulation to close.

     “Capital Stock” means, with respect to any Person, any and all shares, interests,
participations or other equivalents (however designated) of or in such Person’s capital stock or
other equity interests, and options, rights or warrants to purchase such capital stock or other
equity interests, whether now outstanding or issued after the Issue Date, including, without
limitation, all Disqualified Stock and Preferred Stock.

     “Capitalized Lease Obligations” of any Person means the obligations of such Person to pay rent
or other amounts under a lease that is required to be capitalized for financial reporting purposes
in accordance with GAAP, and the amount of such obligations will be the capitalized amount thereof
determined in accordance with GAAP.

     “Cash Equivalents” means

     (a) U.S. dollars;

     (b) securities issued or directly and fully guaranteed or insured by the U.S. government or
any agency or instrumentality thereof having maturities of one year or less from the date of
acquisition;

     (c) certificates of deposit and eurodollar time deposits with maturities of one year or less
from the date of acquisition, bankers’ acceptances with

4

 

maturities not exceeding six months and overnight bank deposits, in each case with any
domestic commercial bank having capital and surplus in excess of $500 million;

     (d) repurchase obligations with a term of not more than seven days for underlying securities
of the types described in clauses (b) and (c) of this definition entered into with any financial
institution meeting the qualifications specified in clause (c) of this definition;

     (e) commercial paper rated P-1, A-1 or the equivalent thereof by Moody’s or S&P, respectively,
and in each case maturing within six months after the date of acquisition; and

     (f) investments in money market funds substantially all of the assets of which consist of
securities described in the foregoing clauses (a) through (e) of this definition.

     “cash transaction” has the meaning ascribed to it in Section 7.03 hereof.

     “Certificate of Beneficial Ownership” means a certificate substantially in the form of Exhibit
H.

     “Certificated Note” means a Note in registered individual form without interest coupons.

     “Change of Control” means

     (a) any sale, lease or other transfer (in one transaction or a series of transactions) of all
or substantially all of the consolidated assets of the Company and its Restricted Subsidiaries to
any Person (other than a Restricted Subsidiary); provided, however, that a transaction where the
holders of all classes of Common Equity of the Company immediately prior to such transaction own,
directly or indirectly, more than 50% of all classes of Common Equity of such Person immediately
after such transaction shall not be a Change of Control;

     (b) a “person” or “group” (within the meaning of Section 13(d) of the Exchange Act (other than
(x) the Company or (y) the Permitted Hovnanian Holders)) becomes the “beneficial owner” (as defined
in Rule 13d-3 under the Exchange Act) of Common Equity of the Company representing more than 50% of
the voting power of the Common Equity of the Company;

     (c) Continuing Directors cease to constitute at least a majority of the Board of Directors of
the Company;

     (d) the stockholders of the Company approve any plan or proposal for the liquidation or
dissolution of the Company; provided, however, that a

5

 

liquidation or dissolution of the Company which is part of a transaction that does not
constitute a Change of Control under the proviso contained in clause (a) of this definition shall
not constitute a Change of Control; or

     (e) a change of control shall occur as defined in the instrument governing any publicly traded
debt securities of the Company or the Issuer which requires the Company or the Issuer to repay or
repurchase such debt securities.

     “Clearstream” means Clearstream Banking, société anonyme, Luxembourg, formerly Cedelbank.

     “Collateral” means all property or assets of the Issuer and the Guarantors (whether now owned
or hereafter arising or acquired) that secures Third-Priority Lien Obligations under the Security
Documents.

     “Collateral Agent” means the Trustee acting as the collateral agent for the holders of the
Third-Priority Lien Obligations under the Security Documents and any successor acting in such
capacity.

     “Collateralized Debt” means (i) the aggregate principal amount of all Indebtedness and all
letters of credit secured by Liens on the Collateral and (ii) the aggregate amount of all unfunded
commitments under all credit facilities or lines of credit secured by Liens on the Collateral but
excluding Indebtedness, letters of credit and unfunded commitments secured by Liens on the
Collateral that rank junior to the Liens on the Collateral securing the Second-Priority Liens.

     “Commission” means the Securities and Exchange Commission.

     “Common Equity” of any Person means Capital Stock of such Person that is generally entitled to
(a) vote in the election of directors of such Person or (b) if such Person is not a corporation,
vote or otherwise participate in the selection of the governing body, partners, managers or others
that will control the management or policies of such Person.

     “Company” has the meaning ascribed to it in the preamble hereof and shall also refer to any
successor obligor under the Indenture and its Guarantee(s).

     “Consolidated Adjusted Tangible Assets” of the Company as of any date means the Consolidated
Tangible Assets of the Company, the Issuer and the Restricted Subsidiaries at the end of the fiscal
quarter immediately preceding the date less any assets securing any Non-Recourse Indebtedness, as
determined in accordance with GAAP.

     “Consolidated Cash Flow Available for Fixed Charges” means, for any period, Consolidated Net
Income for such period plus (each to the extent deducted

6

 

in calculating such Consolidated Net Income and determined in accordance with GAAP) the sum
for such period, without duplication, of:

     (a) income taxes,

     (b) Consolidated Interest Expense,

     (c) depreciation and amortization expenses and other non-cash charges to earnings, and

     (d) interest and financing fees and expenses which were previously capitalized and which are
amortized to cost of sales, minus

     all other non-cash items (other than the receipt of notes receivable) increasing such Consolidated
Net Income.

     “Consolidated Fixed Charge Coverage Ratio” means, with respect to any determination date, the
ratio of (x) Consolidated Cash Flow Available for Fixed Charges for the prior four full fiscal
quarters (the “Four Quarter Period”) for which financial results have been reported immediately
preceding the determination date (the “Transaction Date”), to (y) the aggregate Consolidated
Interest Incurred for the Four Quarter Period. For purposes of this definition, “Consolidated Cash
Flow Available for Fixed Charges” and “Consolidated Interest Incurred” shall be calculated after
giving effect on a pro forma basis for the period of such calculation to:

     (a) the incurrence or the repayment, repurchase, defeasance or other discharge or the
assumption by another Person that is not an Affiliate (collectively, “repayment”) of any
Indebtedness of the Company, the Issuer or any Restricted Subsidiary (and the application of the
proceeds thereof) giving rise to the need to make such calculation, and any incurrence or repayment
of other Indebtedness (and the application of the proceeds thereof), at any time on or after the
first day of the Four Quarter Period and on or prior to the Transaction Date, as if such incurrence
or repayment, as the case may be (and the application of the proceeds thereof), occurred on the
first day of the Four Quarter Period, except that Indebtedness under revolving credit facilities
shall be deemed to be the average daily balance of such Indebtedness during the Four Quarter Period
(as reduced on such pro forma basis by the application of any proceeds of the incurrence of
Indebtedness giving rise to the need to make such calculation);

     (b) any Asset Disposition or Asset Acquisition (including, without limitation, any Asset
Acquisition giving rise to the need to make such calculation as a result of the Company, the Issuer
or any Restricted Subsidiary (including any Person that becomes a Restricted Subsidiary as a result
of any such Asset Acquisition) incurring Acquired Indebtedness at any time on or after the first
day of the Four Quarter Period and on or prior to the Transaction Date), as if such

7

 

Asset Disposition or Asset Acquisition (including the incurrence or repayment of any such
Indebtedness) and the inclusion, notwithstanding clause (b) of the definition of “Consolidated Net
Income,” of any Consolidated Cash Flow Available for Fixed Charges associated with such Asset
Acquisition as if it occurred on the first day of the Four Quarter Period; provided, however, that
the Consolidated Cash Flow Available for Fixed Charges associated with any Asset Acquisition shall
not be included to the extent the net income so associated would be excluded pursuant to the
definition of “Consolidated Net Income,” other than clause (b) thereof, as if it applied to the
Person or assets involved before they were acquired; and

     (c) the Consolidated Cash Flow Available for Fixed Charges and the Consolidated Interest
Incurred attributable to discontinued operations, as determined in accordance with GAAP, shall be
excluded.

     Furthermore, in calculating “Consolidated Cash Flow Available for Fixed Charges” for purposes
of determining the denominator (but not the numerator) of this “Consolidated Fixed Charge Coverage
Ratio,”

     (a) interest on Indebtedness in respect of which a pro forma calculation is required that is
determined on a fluctuating basis as of the Transaction Date (including Indebtedness actually
incurred on the Transaction Date) and which will continue to be so determined thereafter shall be
deemed to have accrued at a fixed rate per annum equal to the rate of interest on such Indebtedness
in effect on the Transaction Date, and

     (b) notwithstanding the immediately preceding clause (a), interest on such Indebtedness
determined on a fluctuating basis, to the extent such interest is covered by agreements relating to
Interest Protection Agreements, shall be deemed to accrue at the rate per annum resulting after
giving effect to the operation of such agreements.

     “Consolidated Interest Expense” of the Company for any period means the Interest Expense of
the Company, the Issuer and the Restricted Subsidiaries for such period, determined on a
consolidated basis in accordance with GAAP.

     “Consolidated Interest Incurred” for any period means the Interest Incurred of the Company,
the Issuer and the Restricted Subsidiaries for such period, determined on a consolidated basis in
accordance with GAAP.

     “Consolidated Net Income” for any period means the aggregate net income (or loss) of the
Company and its Subsidiaries for such period, determined on a consolidated basis in accordance with
GAAP; provided, that there will be excluded from such net income (loss) (to the extent otherwise
included therein), without duplication:

8

 

     (a) the net income (or loss) of (x) any Unrestricted Subsidiary (other than a Mortgage
Subsidiary) or (y) any Person (other than a Restricted Subsidiary or a Mortgage Subsidiary) in
which any Person other than the Company, the Issuer or any Restricted Subsidiary has an ownership
interest, except, in each case, to the extent that any such income has actually been received by
the Company, the Issuer or any Restricted Subsidiary in the form of cash dividends or similar cash
distributions during such period, which dividends or distributions are not in excess of the
Company’s, the Issuer’s or such Restricted Subsidiary’s (as applicable) pro rata share of such
Unrestricted Subsidiary’s or such other Person’s net income earned during such period,

     (b) except to the extent includable in Consolidated Net Income pursuant to clause (a) of this
definition, the net income (or loss) of any Person that accrued prior to the date that (i) such
Person becomes a Restricted Subsidiary or is merged with or into or consolidated with the Company,
the Issuer or any of its Restricted Subsidiaries (except, in the case of an Unrestricted Subsidiary
that is redesignated a Restricted Subsidiary during such period, to the extent of its retained
earnings from the beginning of such period to the date of such redesignation) or (ii) the assets of
such Person are acquired by the Company or any Restricted Subsidiary,

     (c) the net income of any Restricted Subsidiary to the extent that (but only so long as) the
declaration or payment of dividends or similar distributions by such Restricted Subsidiary of that
income is not permitted by operation of the terms of its charter or any agreement, instrument,
judgment, decree, order, statute, rule or governmental regulation applicable to that Restricted
Subsidiary during such period,

     (d) the gains or losses, together with any related provision for taxes, realized during such
period by the Company, the Issuer or any Restricted Subsidiary resulting from (i) the acquisition
of securities, or extinguishment of Indebtedness, of the Company or any Restricted Subsidiary or
(ii) any Asset Disposition by the Company or any Restricted Subsidiary, and

     (e) any extraordinary gain or loss together with any related provision for taxes, realized by
the Company, the Issuer or any Restricted Subsidiary;

provided, further, that for purposes of calculating Consolidated Net Income solely as it relates to
clause (iii) of Section 4.07(a) hereof, clause (d)(ii) of this definition shall not be applicable.

     “Consolidated Tangible Assets” of the Company as of any date means the total amount of assets
of the Company, the Issuer and the Restricted Subsidiaries (less applicable reserves) on a
consolidated basis at the end of the fiscal quarter immediately preceding such date, as determined
in accordance with

9

 

GAAP, less (1) Intangible Assets and (2) appropriate adjustments on account of minority
interests of other Persons holding equity investments in Restricted Subsidiaries.

     “Continuing Director” means a director who either was a member of the Board of Directors of
the Company on the Issue Date or who became a director of the Company subsequent to such date and
whose election or nomination for election by the Company’s stockholders was duly approved by a
majority of the Continuing Directors on the Board of Directors of the Company at the time of such
approval, either by a specific vote or by approval of the proxy statement issued by the Company on
behalf of the entire Board of Directors of the Company in which such individual is named as nominee
for director.

     “control” when used with respect to any Person, means the power to direct the management and
policies of such Person, directly or indirectly, whether through the ownership of voting
securities, by contract or otherwise; and the terms “controlling” and “controlled” have meanings
correlative to the foregoing.

     “Corporate Trust Office” means the office of the Trustee at which the corporate trust business
of the Trustee is principally administered, which at the date of this Indenture is located at
Rodney Square North, 1100 North Market Street, Wilmington, DE 19801.

     “Covenant Defeasance” has the meaning ascribed to it in Section 8.02 hereof.

     “Credit Facilities” means, collectively, each of the credit facilities and lines of credit of
the Company or one or more Restricted Subsidiaries in existence, or entered into, on the Issue
Date, including, without limitation, the Revolving Credit Agreement, and one or more other
facilities and lines of credit among or between the Company or one or more Restricted Subsidiaries
and one or more lenders pursuant to which the Company or one or more Restricted Subsidiaries may
incur indebtedness for working capital and general corporate purposes (including acquisitions), as
any such facility or line of credit may be amended, restated, supplemented or otherwise modified
from time to time, and includes any agreement extending the maturity of, increasing the amount of,
or restructuring, all or any portion of the Indebtedness under such facility or line of credit or
any successor facilities or lines of credit and includes any facility or line of credit with one or
more lenders refinancing or replacing all or any portion of the Indebtedness under such facility or
line of credit or any successor facility or line of credit.

     “Currency Agreement” of any Person means any foreign exchange contract, currency swap
agreement or other similar agreement or arrangement

10

 

designed to protect such Person or any of its Subsidiaries against fluctuations in currency
values.

     “Custodian” means any receiver, trustee, assignee, liquidator or similar official under any
Bankruptcy Law.

     “Dealer Managers” means Lazard Frères & Co. LLC, Alvarez & Marsal Securities, LLC and Credit
Suisse Securities (USA) LLC.

     “Dealer Managers Agreement” means the Dealer Managers Agreement dated as of October 27, 2008
by and among the Dealer Managers, the Issuer and the Guarantors party thereto relating to the offer
to exchange Initial Notes for certain of the Issuer’s then outstanding senior notes.

     “Default” means any event, act or condition that is, or after notice or the passage of time or
both would be, an Event of Default.

     “Depositary” means the depositary of each Global Note, which will initially be DTC.

     “Designation Amount” has the meaning ascribed to it in the definition of “Unrestricted
Subsidiary.”

     “Disqualified Stock” means any Capital Stock that, by its terms (or by the terms of any
security into which it is convertible or for which it is exchangeable), or upon the happening of
any event, (a) matures or is mandatorily redeemable, pursuant to a sinking fund obligation or
otherwise, or is redeemable at the option of the holder thereof, in whole or in part, on or prior
to the final maturity date of the Notes or (b) is convertible into or exchangeable or exercisable
for (whether at the option of the issuer or the holder thereof) (i) debt securities or (ii) any
Capital Stock referred to in (a) above, in each case, at any time prior to the final maturity date
of the Notes; provided, however, that any Capital Stock that would not constitute Disqualified
Stock but for provisions thereof giving holders thereof (or the holders of any security into or for
which such Capital Stock is convertible, exchangeable or exercisable) the right to require the
Company to repurchase or redeem such Capital Stock upon the occurrence of a change in control or
asset disposition occurring prior to the final maturity date of the Notes shall not constitute
Disqualified Stock if the change in control or asset disposition provision applicable to such
Capital Stock are no more favorable to such holders than Section 4.10 or Section 4.12 hereof (as
applicable) and such Capital Stock specifically provides that the Company will not repurchase or
redeem any such Capital Stock pursuant to such provisions prior to the Company’s repurchase of the
Notes as are required pursuant to Section 4.10 or Section 4.12 hereof (as applicable).

     “DTC” means The Depository Trust Company, a New York corporation.

11

 

     “DTC Legend” means the legend set forth in Exhibit D.

     “Equity Offering” means any public or private sale, after the Issue Date, of Qualified Stock
of the Company, other than (i) an Excluded Contribution, (ii) public offerings registered on Form
S-4 or S-8 or any successor form thereto or (iii) any issuance pursuant to employee benefit plans
or otherwise in compensation to officers, directors or employees.

     “Euroclear” means Euroclear Bank S.A./N.V. and its successors or assigns, as operator of the
Euroclear System.

     “Event of Default” has the meaning ascribed to it in Section 5.01 hereof.

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

     “Exchange Notes” means the notes of the Issuer issued under the Indenture in exchange for, and
in an aggregate principal amount equal to, the Initial Notes or any Initial Additional Notes in
compliance with the terms of a Registration Rights Agreement and containing terms substantially
identical to the Initial Notes or any Initial Additional Notes (except that (i) such Exchange Notes
will be registered under the Securities Act and will not be subject to transfer restrictions or
bear the Restricted Legend, and (ii) the provisions relating to Additional Interest will be
eliminated).

     “Exchange Offer” means an offer by the Issuer to the Holders of the Initial Notes or any
Initial Additional Notes to exchange such Notes for Exchange Notes, as provided for in the
applicable Registration Rights Agreement.

     “Exchange Offer Registration Statement” means the Exchange Offer Registration Statement as
defined in the applicable Registration Rights Agreement.

     “Excluded Contribution” means cash or Cash Equivalents received by the Company as capital
contributions to its equity (other than through the issuance of Disqualified Stock) or from the
issuance or sale (other than to a Subsidiary) of Qualified Stock of the Company, in each case,
after January 31, 2008 and to the extent designated as an Excluded Contribution pursuant to an
Officers’ Certificate of the Company.

     “Excluded Property” means (a) any pledges of stock of a Guarantor to the extent that Rule 3-16
of Regulation S-X under the Securities Act requires or would require (or is replaced with another
rule or regulation, or any other law, rule or regulation is adopted, that would require) the filing
with the Commission of separate financial statements of such Guarantor that are not otherwise
required to be filed, but only to the extent necessary to not be subject to such requirement, (b)
up to $50.0 million of assets received in connection with Asset Dispositions

12

 

and asset swaps or exchanges as permitted by clause (c) of the definition of “Permitted
Investment,” (c) personal property where the cost of obtaining a security interest or perfection
thereof exceeds its benefits, (d) real property subject to a Lien securing Indebtedness incurred
for the purpose of financing the acquisition thereof, (e) real property located outside the United
States, (f) unentitled land, (g) real property that is leased or held for the purpose of leasing to
unaffiliated third parties, (h) equity interests in Unrestricted Subsidiaries (subject to future
grants under the terms of the Indenture), (i) any real property in a community under development
with a dollar amount of investment as of the most recent month-end (as determined in accordance
with GAAP) of less than $2.0 million or with less than 10 lots remaining, (j) assets, with respect
to which any applicable law or contract prohibits the creation or perfection of security interests
therein and (k) any other assets excluded from the Collateral securing the First-Priority Lien
Obligations or the Second-Priority Lien Obligations, if any.

     “expiration date” has the meaning ascribed to it in Section 3.05(b) hereof.

     “Fair Market Value” means, with respect to any asset, the price (after taking into account any
liabilities relating to such assets) that would be negotiated in an arm’s-length transaction for
cash between a willing seller and a willing and able buyer, neither of which is under any
compulsion to complete the transaction, as such price is determined in good faith by the Board of
Directors of the Company or a duly authorized committee thereof, as evidenced by a resolution of
such Board or committee.

     “First-Priority Lien Obligations” has the meaning ascribed to it in the definition of
“Permitted Liens”.

     “First-Priority Liens” means all Liens that secure the First-Priority Lien Obligations.

     “GAAP” means generally accepted accounting principles set forth in the opinions and
pronouncements of the Accounting Principles Board of the American Institute of Certified Public
Accountants and statements and pronouncements of the Financial Accounting Standards Board or in
such other statements by such other entity as may be approved by a significant segment of the
accounting profession of the United States, as in effect on the Issue Date.

     “Global Note” means a Note in registered, global form without interest coupons.

     “Guarantee” means the guarantee of the Notes by each Guarantor under the Indenture.

13

 

     “guarantee” means any obligation, contingent or otherwise, of any Person directly or
indirectly guaranteeing any Indebtedness of any other Person and, without limiting the generality
of the foregoing, any obligation, direct or indirect, contingent or otherwise, of such Person: (a)
to purchase or pay (or advance or supply funds for the purchase or payment of) such Indebtedness of
such other Person (whether arising by virtue of partnership arrangements, or by agreement to
keep-well, to purchase assets, goods, securities or services, to take-or-pay, or to maintain
financial statement conditions or otherwise) or (b) entered into for purposes of assuring in any
other manner the obligee of such Indebtedness of the payment thereof or to protect such obligee
against loss in respect thereof, in whole or in part; provided, that the term “guarantee” does not
include endorsements for collection or deposit in the ordinary course of business. The term
“guarantee” used as a verb has a corresponding meaning.

     “Guarantors” means (a) initially, the Company and each of the other Guarantors signatory
hereto as set forth on Schedule A hereto, which includes each of the Company’s Restricted
Subsidiaries in existence on the Issue Date, other than the Issuer and K. Hovnanian Poland,
sp.zo.o. and (b) each of the Company’s Subsidiaries that becomes a Guarantor of the Notes pursuant
to the provisions of this Indenture, and their successors, in each case until released from its
respective Guarantee pursuant to this Indenture.

     “Holder” or “Holder(s) of Notes” means the Person in whose name a Note is registered in the
books of the Registrar for the Notes.

     “incurrence” has the meaning ascribed to it in Section 4.06(a) hereof.

     “Indebtedness” of any Person means, without duplication,

     (a) any liability of such Person (i) for borrowed money or under any reimbursement obligation
relating to a letter of credit or other similar instruments (other than standby letters of credit
or similar instruments issued for the benefit of, or surety, performance, completion or payment
bonds, earnest money notes or similar purpose undertakings or indemnifications issued by, such
Person in the ordinary course of business), (ii) evidenced by a bond, note, debenture or similar
instrument (including a purchase money obligation) given in connection with the acquisition of any
businesses, properties or assets of any kind or with services incurred in connection with capital
expenditures (other than any obligation to pay a contingent purchase price which, as of the date of
incurrence thereof, is not required to be recorded as a liability in accordance with GAAP), or
(iii) in respect of Capitalized Lease Obligations (to the extent of the Attributable Debt in
respect thereof),

     (b) any Indebtedness of others that such Person has guaranteed to the extent of the guarantee;
provided, however, that Indebtedness of the Company and

14

 

its Restricted Subsidiaries will not include the obligations of the Company or a Restricted
Subsidiary under warehouse lines of credit of Mortgage Subsidiaries to repurchase mortgages at
prices no greater than 98% of the principal amount thereof, and upon any such purchase the excess,
if any, of the purchase price thereof over the Fair Market Value of the mortgages acquired, will
constitute Restricted Payments subject to Section 4.07 hereof,

     (c) to the extent not otherwise included, the obligations of such Person under Currency
Agreements or Interest Protection Agreements to the extent recorded as liabilities not constituting
Interest Incurred, net of amounts recorded as assets in respect of such agreements, in accordance
with GAAP, and

     (d) all Indebtedness of others secured by a Lien on any asset of such Person, whether or not
such Indebtedness is assumed by such Person;

provided, that Indebtedness shall not include accounts payable, liabilities to trade creditors of
such Person or other accrued expenses arising in the ordinary course of business. The amount of
Indebtedness of any Person at any date shall be (i) the outstanding balance at such date of all
unconditional obligations as described above, net of any unamortized discount to be accounted for
as Interest Expense, in accordance with GAAP, (ii) the maximum liability of such Person for any
contingent obligations under clause (a) of this definition at such date, net of an unamortized
discount to be accounted for as Interest Expense in accordance with GAAP, and (iii) in the case of
clause (d) of this definition, the lesser of (x) the fair market value of any asset subject to a
Lien securing the Indebtedness of others on the date that the Lien attaches and (y) the amount of
the Indebtedness secured.

     “Indenture” means this indenture, as amended or supplemented from time to time.

     “Initial Additional Notes” means Additional Notes of the Issuer issued under the Indenture in
an offering not registered under the Securities Act and any Notes issued in replacement therefor,
but not including any Exchange Notes issued in exchange therefor.

     “Initial Notes” means the notes of the Issuer issued under the Indenture on the Issue Date and
any Notes issued in replacement thereof, but not including any Exchange Notes issued in exchange
therefor.

     “Initial Purchasers” means the initial purchasers party to a purchase agreement with the
Issuer, the Company and the Guarantors party thereto relating to the sale of any Additional Notes
by the Issuer.

     “Institutional Accredited Investor Certificate” means a certificate substantially in the form
of Exhibit G hereto.

15

 

     “Intangible Assets” of the Company means all unamortized debt discount and expense,
unamortized deferred charges, goodwill, patents, trademarks, service marks, trade names,
copyrights, write-ups of assets over their prior carrying value (other than write-ups which
occurred prior to the Issue Date and other than, in connection with the acquisition of an asset,
the write-up of the value of such asset (within one year of its acquisition) to its fair market
value in accordance with GAAP) and all other items which would be treated as intangible on the
consolidated balance sheet of the Company, the Issuer and the Restricted Subsidiaries prepared in
accordance with GAAP.

     “Intercreditor Agreement” means the Intercreditor Agreement dated on or about the Issue Date
among the Administrative Agent, the Second Lien Notes Trustee, the Second Lien Notes Collateral
Agent, the Trustee, the Collateral Agent, Wilmington Trust Company, the Issuer, the Company and
each other Guarantor named therein, as such agreement may be amended, restated, supplemented or
otherwise modified from time to time.

     “Interest Expense” of any Person for any period means, without duplication, the aggregate
amount of (a) interest which, in conformity with GAAP, would be set opposite the caption “interest
expense” or any like caption on an income statement for such Person (including, without limitation,
imputed interest included in Capitalized Lease Obligations, all commissions, discounts and other
fees and charges owed with respect to letters of credit and bankers’ acceptance financing, the net
costs (but reduced by net gains) associated with Currency Agreements and Interest Protection
Agreements, amortization of other financing fees and expenses, the interest portion of any deferred
payment obligation, amortization of discount or premium, if any, and all other noncash interest
expense (other than interest and other charges amortized to cost of sales)), and (b) all interest
actually paid by the Company or a Restricted Subsidiary under any guarantee of Indebtedness
(including, without limitation, a guarantee of principal, interest or any combination thereof) of
any Person other than the Company, the Issuer or any Restricted Subsidiary during such period;
provided, that Interest Expense shall exclude any expense associated with the complete write-off of
financing fees and expenses in connection with the repayment of any Indebtedness.

     “Interest Incurred” of any Person for any period means, without duplication, the aggregate
amount of (a) Interest Expense and (b) all capitalized interest and amortized debt issuance costs.

     “Interest Payment Date” means each May 1 and November 1 of each year, commencing May 1, 2009.

     “Interest Protection Agreement” of any Person means any interest rate swap agreement, interest
rate collar agreement, option or futures contract or other

16

 

similar agreement or arrangement designed to protect such Person or any of its Subsidiaries
against fluctuations in interest rates with respect to Indebtedness permitted to be incurred under
the Indenture.

     “Investments” of any Person means (a) all investments by such Person in any other Person in
the form of loans, advances or capital contributions, (b) all guarantees of Indebtedness or other
obligations of any other Person by such Person, (c) all purchases (or other acquisitions for
consideration) by such Person of Indebtedness, Capital Stock or other securities of any other
Person and (d) all other items that would be classified as investments in any other Person
(including, without limitation, purchases of assets outside the ordinary course of business) on a
balance sheet of such Person prepared in accordance with GAAP.

     “Issue Date” means December 3, 2008.

     “Issuer” has the meaning ascribed to it in the preamble hereof and shall also refer to any
successor obligor under the Indenture.

     “Legal Defeasance” has the meaning ascribed to it in Section 8.01 hereof.

     “Lien” means, with respect to any Property, any mortgage, lien, pledge, charge, security
interest or encumbrance of any kind in respect of such Property. For purposes of this definition,
a Person shall be deemed to own, subject to a Lien, any Property which it has acquired or holds
subject to the interest of a vendor or lessor under any conditional sale agreement, capital lease
or other title retention agreement relating to such Property.

     “Marketable Securities” means (a) equity securities that are listed on the New York Stock
Exchange, the American Stock Exchange or The Nasdaq Stock Market and (b) debt securities that are
rated by a nationally recognized rating agency, listed on the New York Stock Exchange or the
American Stock Exchange or covered by at least two reputable market makers.

     “Moody’s” means Moody’s Investors Service, Inc. or any successor to its debt rating business.

     “Mortgage Subsidiary” means any Subsidiary of the Company substantially all of whose
operations consist of the mortgage lending business.

     “Mortgage Tax Collateral Agent” means Wilmington Trust Company in its capacity as Mortgage Tax
Collateral Agent with respect to Liens granted on real property located in certain states
identified under the Intercreditor Agreement and any successor thereto.

     “Net Cash Proceeds” means with respect to an Asset Disposition, payments received in cash
(including any such payments received by way of

17

 

deferred payment of principal pursuant to a note or installment receivable or otherwise
(including any cash received upon sale or disposition of such note or receivable), but only as and
when received), excluding any other consideration received in the form of assumption by the
acquiring Person of Indebtedness or other obligations relating to the Property disposed of in such
Asset Disposition or received in any other non-cash form unless and until such non-cash
consideration is converted into cash therefrom, in each case, net of all legal, title and recording
tax expenses, commissions and other fees and expenses incurred, and all federal, state and local
taxes required to be accrued as a liability under GAAP as a consequence of such Asset Disposition,
and in each case net of a reasonable reserve for the after-tax cost of any indemnification or other
payments (fixed and contingent) attributable to the seller’s indemnities or other obligations to
the purchaser undertaken by the Company, the Issuer or any of its Restricted Subsidiaries in
connection with such Asset Disposition, and net of all payments made on any Indebtedness which is
secured by or relates to such Property (other than Indebtedness secured by Liens on the Collateral)
in accordance with the terms of any Lien or agreement upon or with respect to such Property or
which such Indebtedness must by its terms or by applicable law be repaid out of the proceeds from
such Asset Disposition, and net of all contractually required distributions and payments made to
minority interest holders in Restricted Subsidiaries or joint ventures as a result of such Asset
Disposition.

     “Non-Recourse Indebtedness” with respect to any Person means Indebtedness of such Person for
which (a) the sole legal recourse for collection of principal and interest on such Indebtedness is
against the specific property identified in the instruments evidencing or securing such
Indebtedness and such property was acquired with the proceeds of such Indebtedness or such
Indebtedness was incurred within 90 days after the acquisition of such property and (b) no other
assets of such Person may be realized upon in collection of principal or interest on such
Indebtedness. Indebtedness which is otherwise Non-Recourse Indebtedness will not lose its
character as Non-Recourse Indebtedness because there is recourse to the borrower, any guarantor or
any other Person for (i) environmental warranties and indemnities, or (ii) indemnities for and
liabilities arising from fraud, misrepresentation, misapplication or non-payment of rents, profits,
insurance and condemnation proceeds and other sums actually received by the borrower from secured
assets to be paid to the lender, waste and mechanics’ liens.

     “Non-U.S. Person” means a Person that is not a “U.S. person,” as such term is defined in
Regulation S.

     “Notes” has the meaning ascribed to it in the Recitals hereof.

     “offer” has the meaning ascribed to it in Section 3.05(a) hereof.

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     “Obligations” means with respect to any Indebtedness, all obligations (whether in existence on
the Issue Date or arising afterwards, absolute or contingent, direct or indirect) for or in respect
of principal (when due, upon acceleration, upon redemption, upon mandatory repayment or repurchase
pursuant to a mandatory offer to purchase, or otherwise), premium, interest, penalties, fees,
indemnification, reimbursement and other amounts payable and liabilities with respect to such
Indebtedness, including all interest accrued or accruing after the commencement of any bankruptcy,
insolvency or reorganization or similar case or proceeding at the contract rate (including, without
limitation, any contract rate applicable upon default) specified in the relevant documentation,
whether or not the claim for such interest is allowed as a claim in such case or proceeding.

     “Offer to Purchase” has the meaning ascribed to it in Section 3.05(a) hereof.

     “Officer,” when used with respect to the Issuer or the Company, means the chairman of the
Board of Directors, the president or chief executive officer, any vice president, the chief
financial officer, the treasurer, any assistant treasurer, the controller, any assistant
controller, the secretary or any assistant secretary of the Issuer or the Company, as the case may
be.

     “Officers’ Certificate,” when used with respect to the Issuer or the Company, means a
certificate signed by the chairman of the Board of Directors, the president or chief executive
officer, or any vice president and by the chief financial officer, the treasurer, any assistant
treasurer, the controller, any assistant controller, the secretary or any assistant secretary of
the Issuer or the Company, as the case may be.

     “Opinion of Counsel” means a written opinion signed by legal counsel of the Issuer or the
Company, who may be an employee of, or counsel to, the Issuer or the Company, and who shall be
reasonably satisfactory to the Trustee.

     “Original Notes” means the Initial Notes and any Exchange Notes issued in exchange therefor.

     “Paying Agent” refers to a Person engaged to perform the obligations of the Trustee in respect
of payments made or funds held hereunder in respect of the Notes.

     “Permanent Regulation S Global Note” means a Regulation S Global Note that does not bear the
Regulation S Temporary Global Note Legend.

     “Permitted Hovnanian Holders” means, collectively, Kevork S. Hovnanian, Ara K. Hovnanian, the
members of their immediate families, the respective estates, spouses, heirs, ancestors, lineal
descendants, legatees and legal representatives of any of the foregoing and the trustee of any bona
fide trust of

19

 

which one or more of the foregoing are the sole beneficiaries or the grantors thereof, or any
entity of which any of the foregoing, individually or collectively, beneficially own more than 50%
of the Common Equity.

     “Permitted Indebtedness” means

     (a) Indebtedness under Credit Facilities which does not exceed $300.0 million principal amount
outstanding at any one time;

     (b) Indebtedness in respect of obligations of the Company and its Subsidiaries to the trustees
under indentures for debt securities;

     (c) intercompany debt obligations of (i) the Company to the Issuer, (ii) the Issuer to the
Company, (iii) the Company or the Issuer to any Restricted Subsidiary and (iv) any Restricted
Subsidiary to the Company or the Issuer or any other Restricted Subsidiary; provided, however, that
any Indebtedness of any Restricted Subsidiary or the Issuer or the Company owed to any Restricted
Subsidiary or the Issuer that ceases to be a Restricted Subsidiary shall be deemed to be incurred
and shall be treated as an incurrence for purposes of Section 4.06(a) hereof at the time the
Restricted Subsidiary in question ceases to be a Restricted Subsidiary;

     (d) Indebtedness of the Company or the Issuer or any Restricted Subsidiary under any Currency
Agreements or Interest Protection Agreements in a notional amount no greater than the payments due
(at the time the related Currency Agreement or Interest Protection Agreement is entered into) with
respect to the Indebtedness or currency being hedged;

     (e) Purchase Money Indebtedness and Capitalized Lease Obligations in an aggregate principal
amount outstanding at any one time not to exceed $25.0 million;

     (f) obligations for, pledge of assets in respect of, and guaranties of, bond financings of
political subdivisions or enterprises thereof in the ordinary course of business;

     (g) Indebtedness secured only by office buildings owned or occupied by the Company or any
Restricted Subsidiary, which Indebtedness does not exceed $10 million aggregate principal amount
outstanding at any one time;

     (h) Indebtedness under warehouse lines of credit, repurchase agreements and Indebtedness
secured by mortgage loans and related assets of mortgage lending Subsidiaries in the ordinary
course of a mortgage lending business; and

20

 

     (i) Indebtedness of the Company or any Restricted Subsidiary which, together with all other
Indebtedness under this clause (i), does not exceed $50 million aggregate principal amount
outstanding at any one time.

     “Permitted Investment” means

     (a) Cash Equivalents;

     (b) any Investment in the Company, the Issuer or any Restricted Subsidiary or any Person that
becomes a Restricted Subsidiary as a result of such Investment or that is consolidated or merged
with or into, or transfers all or substantially all of the assets of it or an operating unit or
line of business to, the Company or a Restricted Subsidiary;

     (c) any receivables, loans or other consideration taken by the Company, the Issuer or any
Restricted Subsidiary in connection with any asset sale otherwise permitted by the Indenture;
provided that non-cash consideration received in an Asset Disposition or an exchange or swap of
assets shall be pledged as Collateral under the Security Documents to the extent the assets subject
to such Asset Disposition or exchange or swap of assets constituted Collateral, with the Lien on
such Collateral securing the Notes being of the same priority with respect to the Notes as the Lien
on the assets disposed of; provided, further, that notwithstanding the foregoing clause, up to an
aggregate of $50.0 million of (x) non-cash consideration and consideration received as referred to
in Section 4.10(b)(ii), (y) assets invested in pursuant to Section 4.10(c) and (z) assets received
pursuant to clause (d) under the definition of “Asset Disposition” may be designated by the Company
or the Issuer as Excluded Property not required to be pledged as Collateral;

     (d) Investments received in connection with any bankruptcy or reorganization proceeding, or as
a result of foreclosure, perfection or enforcement of any Lien or any judgment or settlement of any
Person in exchange for or satisfaction of Indebtedness or other obligations or other property
received from such Person, or for other liabilities or obligations of such Person created, in
accordance with the terms of the Indenture;

     (e) Investments in Currency Agreements or Interest Protection Agreements described in the
definition of “Permitted Indebtedness”;

     (f) any loan or advance to an executive officer, director or employee of the Company or any
Restricted Subsidiary made in the ordinary course of business or in accordance with past practice;
provided, however, that any such loan or advance exceeding $1 million shall have been approved by
the Board of Directors of the Company or a committee thereof consisting of disinterested members;

21

 

     (g) Investments in interests in issuances of collateralized mortgage obligations, mortgages,
mortgage loan servicing, or other mortgage related assets;

     (h) obligations of the Company or a Restricted Subsidiary under warehouse lines of credit of
Mortgage Subsidiaries to repurchase mortgages; and

     (i) Investments in an aggregate amount outstanding not to exceed $10 million.

     “Permitted Liens” means

     (a) Liens for taxes, assessments or governmental or quasi-government charges or claims that
(i) are not yet delinquent, (ii) are being contested in good faith by appropriate proceedings and
as to which appropriate reserves have been established or other provisions have been made in
accordance with GAAP, if required, or (iii) encumber solely property abandoned or in the process of
being abandoned,

     (b) statutory Liens of landlords and carriers’, warehousemen’s, mechanics’, suppliers’,
materialmen’s, repairmen’s or other Liens imposed by law and arising in the ordinary course of
business and with respect to amounts that, to the extent applicable, either (i) are not yet
delinquent or (ii) are being contested in good faith by appropriate proceedings and as to which
appropriate reserves have been established or other provisions have been made in accordance with
GAAP, if required,

     (c) Liens (other than any Lien imposed by the Employer Retirement Income Security Act of 1974,
as amended) incurred or deposits made in the ordinary course of business in connection with
workers’ compensation, unemployment insurance and other types of social security,

     (d) Liens incurred or deposits made to secure the performance of tenders, bids, leases,
statutory obligations, surety and appeal bonds, development obligations, progress payments,
government contacts, utility services, developer’s or other obligations to make on-site or off-site
improvements and other obligations of like nature (exclusive of obligations for the payment of
borrowed money but including the items referred to in the parenthetical in clause (a)(i) of the
definition of “Indebtedness”), in each case incurred in the ordinary course of business of the
Company, the Issuer and the Restricted Subsidiaries,

     (e) attachment or judgment Liens not giving rise to a Default or an Event of Default,

     (f) easements, dedications, assessment district or similar Liens in connection with municipal
or special district financing, rights-of-way, restrictions, reservations and other similar charges,
burdens, and other similar charges or

22

 

encumbrances not materially interfering with the ordinary course of business of the Company,
the Issuer and the Restricted Subsidiaries,

     (g) zoning restrictions, licenses, restrictions on the use of real property or minor
irregularities in title thereto, which do not materially impair the use of such real property in
the ordinary course of business of the Company, the Issuer and the Restricted Subsidiaries,

     (h) Liens securing Indebtedness incurred pursuant to clause (g) or (h) of the definition of
“Permitted Indebtedness”,

     (i) Liens on the Collateral and other assets not constituting Collateral pursuant to clauses
(a) and (b) of the definition of “Excluded Property” securing:

          (a) the Notes (other than Additional Notes), the Guarantees thereof and other Obligations
under the Indenture and the Security Documents and in respect thereof and any obligations owing to
the Trustee or the Collateral Agent under the Indenture or the Security Documents;

          (b) (i) Indebtedness incurred under clause (a) of the definition of “Permitted Indebtedness”
(and all Obligations, including letters of credit and similar instruments, incurred, issued or
arising under such secured Credit Facilities that permit borrowings not in excess of the limit set
out in such clause (a)) and Liens securing Refinancing Indebtedness in respect thereof (which
Refinancing Indebtedness is incurred under such clause (a)), (ii) up to an additional $25.0 million
of Indebtedness otherwise permitted to be incurred under the Indenture (and all Obligations,
including letters of credit and similar instruments, incurred, issued or arising thereunder) and
Liens securing Refinancing Indebtedness in respect thereof and (iii) Obligations under Currency
Agreements and Interest Protection Agreements entered into with agents or lenders under the
Indebtedness referred to in clause (i)(b)(i) of this definition or their affiliates, which Liens
incurred under this clause (i)(b) may be on a first-lien priority basis senior to the Liens
securing the Notes on terms as set forth in the Intercreditor Agreement (collectively,
“First-Priority Lien Obligations”);

          (c) other Indebtedness permitted to be incurred under the Indenture (and all Obligations in
respect thereof), which may be in the form of Additional Notes; provided, that (i) such
Indebtedness is Refinancing Indebtedness issued in exchange for or to refinance Indebtedness of the
Issuer outstanding on May 27, 2008 and (ii) the Liens securing such Indebtedness rank pari passu
with (or junior to) the Liens on the Collateral securing the Notes (if junior, on a basis
substantially the same as the basis on which the Liens securing the Notes are treated under the
Intercreditor Agreement with respect to the Second-Priority Liens); provided, further, that after
giving effect to such incurrence, the aggregate amount of all consolidated Indebtedness of the
Company, the Issuer and the

23

 

Restricted Subsidiaries (including, with respect to Capitalized Lease Obligations, the
Attributable Debt in respect thereof) secured by Liens (other than Non-Recourse Indebtedness and
Indebtedness incurred pursuant to clause (h) of the definition of “Permitted Indebtedness”) shall
not exceed 40% of Consolidated Adjusted Tangible Assets at any one time outstanding (after giving
effect to the incurrence of such Indebtedness and the use of the proceeds thereof); and

          (d) the Second Lien Notes, the guarantees thereof and other Obligations under the Second Lien
Notes Indenture and the security documents related thereto and in respect thereof and any
obligations owing to the Second Lien Notes Trustee or the Second Lien Notes Collateral Agent under
the Second Lien Notes Indenture or the security documents related thereto and any Liens securing
Refinancing Indebtedness in respect thereof, which Liens incurred under this clause (i)(d) may be
on a second-lien priority basis senior to the Liens securing the Notes on terms as set forth in the
Intercreditor Agreement (the “Second-Priority Lien Obligations”),

     (j) Liens securing Non-Recourse Indebtedness of the Company, the Issuer or any Restricted
Subsidiary; provided, that such Liens apply only to the property financed out of the net proceeds
of such Non-Recourse Indebtedness within 90 days after the incurrence of such Non-Recourse
Indebtedness,

     (k) Liens securing Purchase Money Indebtedness; provided, that such Liens apply only to the
property acquired, constructed or improved with the proceeds of such Purchase Money Indebtedness
within 90 days after the incurrence of such Purchase Money Indebtedness,

     (l) Liens on property or assets of the Company, the Issuer or any Restricted Subsidiary
securing Indebtedness of the Company, the Issuer or any Restricted Subsidiary owing to the Company,
the Issuer or one or more Restricted Subsidiaries (other than K. Hovnanian Poland, sp.zo.o.),

     (m) leases or subleases granted to others not materially interfering with the ordinary course
of business of the Company and the Restricted Subsidiaries,

     (n) purchase money security interests (including, without limitation, Capitalized Lease
Obligations); provided, that such Liens apply only to the Property acquired and the related
Indebtedness is incurred within 90 days after the acquisition of such Property,

     (o) any right of first refusal, right of first offer, option, contract or other agreement to
sell an asset; provided, that such sale is not otherwise prohibited under the Indenture,

     (p) any right of a lender or lenders to which the Company, the Issuer or a Restricted
Subsidiary may be indebted to offset against, or appropriate and

24

 

apply to the payment of such, Indebtedness any and all balances, credits, deposits, accounts
or money of the Company, the Issuer or a Restricted Subsidiary with or held by such lender or
lenders or its Affiliates,

     (q) any pledge or deposit of cash or property in conjunction with obtaining surety,
performance, completion or payment bonds and letters of credit or other similar instruments or
providing earnest money obligations, escrows or similar purpose undertakings or indemnifications in
the ordinary course of business of the Company, the Issuer and the Restricted Subsidiaries,

     (r) Liens for homeowner and property owner association developments and assessments,

     (s) Liens securing Refinancing Indebtedness; provided, that such Liens extend only to the
assets securing the Indebtedness being refinanced and have the same or junior priority as the
initial Liens; provided, further, that no Liens may be incurred under this clause (s) in respect of
Refinancing Indebtedness incurred to refinance Indebtedness that is secured by Liens incurred under
clauses (i)(b)(i), (i)(b)(ii) or (i)(d) of this definition (it being understood that Liens incurred
in respect of such Indebtedness may only be refinanced under such clauses (i)(b)(i), (i)(b)(ii) or
(i)(d),

     (t) Liens incurred in the ordinary course of business as security for the obligations of the
Company, the Issuer and the Restricted Subsidiaries with respect to indemnification in respect of
title insurance providers,

     (u) Liens on property of a Person existing at the time such Person is merged with or into or
consolidated with the Company or any Subsidiary of the Company or becomes a Subsidiary of the
Company; provided, that such Liens were in existence prior to the contemplation of such merger or
consolidation or acquisition and do not extend to any assets other than those of the Person merged
into or consolidated with the Company or the Subsidiary or acquired by the Company or its
Subsidiaries,

     (v) Liens on property existing at the time of acquisition thereof by the Company or any
Subsidiary of the Company, provided, that such Liens were in existence prior to the contemplation
of such acquisition,

     (w) Liens existing on the Issue Date (other than Liens securing Obligations under the
Revolving Credit Agreement, the Second Lien Notes or the Notes) and any extensions, renewals or
replacements thereof, and

     (x) Liens on specific items of inventory or other goods and proceeds of any Person securing
such Person’s obligations in respect of bankers’ acceptances issued or created for the account of
such Person to facilitate the purchase, shipment or storage of such inventory or other goods.

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     “Person” means any individual, corporation, partnership, limited liability company, joint
venture, incorporated or unincorporated association, joint stock company, trust, unincorporated
organization or government or any agency or political subdivision thereof.

     “Preferred Stock” of any Person means all Capital Stock of such Person which has a preference
in liquidation or with respect to the payment of dividends.

     “Property” of any Person means all types of real, personal, tangible, intangible or mixed
property owned by such Person, whether or not included in the most recent consolidated balance
sheet of such Person and its Subsidiaries under GAAP.

     “purchase amount” has the meaning ascribed to it in Section 3.05(b) hereof.

     “purchase date” has the meaning ascribed to it in Section 3.05(b) hereof.

     “Purchase Money Indebtedness” means Indebtedness of the Company, the Issuer or any Restricted
Subsidiary incurred for the purpose of financing all or any part of the purchase price, or the cost
of construction or improvement, of any property to be used in the ordinary course of business by
the Company, the Issuer and the Restricted Subsidiaries; provided, however, that (a) the aggregate
principal amount of such Indebtedness shall not exceed such purchase price or cost and (b) such
Indebtedness shall be incurred no later than 90 days after the acquisition of such property or
completion of such construction or improvement.

     “Qualified Stock” means Capital Stock of the Company other than Disqualified Stock.

     “Real Estate Business” means homebuilding, housing construction, real estate development or
construction and the sale of homes and related real estate activities, including the provision of
mortgage financing or title insurance.

     “Record Date” for the interest payable on any Interest Payment Date means the April 15 or
October 15 (whether or not a Business Day) immediately preceding such Interest Payment Date.

     “Refinancing Indebtedness” means Indebtedness (to the extent not Permitted Indebtedness) that
refunds, refinances or extends any Indebtedness of the Company, the Issuer or any Restricted
Subsidiary (to the extent not Permitted Indebtedness) outstanding on the Issue Date or other
Indebtedness (to the extent not Permitted Indebtedness) permitted to be incurred by the Company,
the Issuer or any Restricted Subsidiary pursuant to the terms of the Indenture, but only to the
extent that:

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     (a) the Refinancing Indebtedness is subordinated, if at all, to the Notes or the Guarantees,
as the case may be, to the same extent as the Indebtedness being refunded, refinanced or extended (provided that Refinancing Indebtedness issued to
refund, refinance or extend Subordinated Indebtedness outstanding as of the Issue Date (“Existing
Subordinated Debt”) need not be subordinated to the Notes or the Guarantees, as the case may, so
long as any Liens securing such Indebtedness are pari passu or junior to the Liens securing the
Notes or the Guarantees, as the case may be),

     (b) the Refinancing Indebtedness is scheduled to mature either (i) no earlier than the
Indebtedness being refunded, refinanced or extended or (ii) after the maturity date of the Notes
(unless the Refinancing Indebtedness is in respect of Existing Subordinated Debt and is secured by
Liens on the Collateral, in which case the Refinancing Indebtedness must be scheduled to mature no
earlier than the maturity date of the Notes),

     (c) the portion, if any, of the Refinancing Indebtedness that is scheduled to mature on or
prior to the maturity date of the Notes has a Weighted Average Life to Maturity at the time such
Refinancing Indebtedness is incurred that is equal to or greater than the Weighted Average Life to
Maturity of the portion of the Indebtedness being refunded, refinanced or extended that is
scheduled to mature on or prior to the maturity date of the Notes, and

     (d) such Refinancing Indebtedness is in an aggregate principal amount that is equal to or less
than the aggregate principal amount then outstanding under the Indebtedness being refunded,
refinanced or extended.

     “Register” has the meaning ascribed to it in Section 2.09 hereof.

     “Registrar” means a Person engaged to maintain the Register.

     “Registration Rights Agreement” means (i) with respect to the Initial Notes, the Registration
Rights Agreement dated the Issue Date among the Issuer, the Company, the other Guarantors party
thereto and the Dealer Managers, and (ii) with respect to any Initial Additional Notes, any
registration rights agreements among the Issuer, the Company, the other Guarantors party thereto
and any initial purchasers or dealer managers party thereto relating to rights given by the Issuer
to the purchasers of Initial Additional Notes to register such Initial Additional Notes or exchange
them for Exchange Notes registered under the Securities Act.

     “Regulation S” means Regulation S under the Securities Act.

     “Regulation S Certificate” means a certificate substantially in the form of Exhibit E hereto.

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     “Regulation S Global Note” means a Global Note representing Notes issued and sold pursuant to
Regulation S.

     “Regulation S Temporary Global Note” means an Regulation S Global Note that bears the
Regulation S Temporary Global Note Legend.

     “Regulation S Temporary Global Note Legend” means the legend set forth in Exhibit I.

     “Repurchase Date” has the meaning ascribed to it in Section 4.12(a) hereof.

     “Responsible Officer,” when used with respect to the Trustee, means any officer of the Trustee
with direct responsibility for the administration of the trust created by this Indenture.

     “Restricted Investment” means any Investment other than a Permitted Investment.

     “Restricted Legend” means the legend set forth in Exhibit C.

     “Restricted Payment” means any of the following:

     (a) the declaration or payment of any dividend or any other distribution on Capital Stock of
the Company, the Issuer or any Restricted Subsidiary or any payment made to the direct or indirect
holders (in their capacities as such) of Capital Stock of the Company, the Issuer or any Restricted
Subsidiary (other than (i) dividends or distributions payable solely in Qualified Stock and (ii) in
the case of the Issuer or Restricted Subsidiaries, dividends or distributions payable to the
Company, the Issuer or a Restricted Subsidiary);

     (b) the purchase, redemption or other acquisition or retirement for value of any Capital Stock
of the Company, the Issuer or any Restricted Subsidiary (other than a payment made to the Company,
the Issuer or any Restricted Subsidiary);

     (c) any Investment (other than any Permitted Investment), including any Investment in an
Unrestricted Subsidiary (including by the designation of a Subsidiary of the Company as an
Unrestricted Subsidiary) and any amounts paid in accordance with clause (b) of the definition of
“Indebtedness”; and

     (d) the purchase, repurchase, redemption, acquisition or retirement for value, prior to the
date for any scheduled maturity, sinking fund or amortization or other principal installment
payment, of any Subordinated Indebtedness (other than (a) Indebtedness permitted under clause (c)
of the definition of “Permitted Indebtedness” or (b) the purchase, repurchase, redemption,
defeasance, or other

28

 

acquisition or retirement of Subordinated Indebtedness purchased in
anticipation of satisfying a sinking fund obligation, amortization or principal installment or
final maturity, in each case due within one year of the date of purchase, repurchase, redemption,
defeasance or other acquisition or retirement).

     “Restricted Period” means the relevant 40-day “distribution compliance period” as such term is
defined in Regulation S, which, for each relevant Note, commences on the date such Note is issued.

     “Restricted Subsidiary” means any Subsidiary of the Company which is not an Unrestricted
Subsidiary.

     “Revolving Credit Agreement” means that certain Seventh Amended and Restated Credit Agreement
dated as of March 7, 2008, as amended by Amendment No. 1 thereto dated May 16, 2008, among the
Issuer, the Company, the Administrative Agent, and a syndicate of lenders, as may be amended,
restated, renewed, modified, refunded, replaced, revised, restructured or refinanced in whole or in
part from time to time, including to extend the maturity thereof, to increase the amount of
commitments thereunder (provided that any such increase is permitted under Section 4.06, or to add
Restricted Subsidiaries as additional borrowers or guarantors thereunder, whether by the same or
any other agent, lender or group of lenders or investors and whether such revision, restructuring,
amendment, restatement, refunding, renewal, modification, replacement or refinancing is under one
or more credit facilities or commercial paper facilities, indentures or other agreements, in each
case with banks or other institutional lenders or trustees or investors providing for revolving
credit loans, term loans, notes or letters or credit, together with related documents thereto
(including, without limitation, any guaranty agreements and security documents).

     “Rule 144A” means Rule 144A under the Securities Act.

     “Rule 144A Certificate” means a certificate substantially in the form of Exhibit F hereto.

     “Rule 144A Global Note” means a Global Note that bears the Restricted Legend representing
Notes issued, transferred or exchanged pursuant to Rule 144A.

     “S&P” means Standard & Poor’s Ratings Services, a division of The McGraw Hill Companies, Inc.,
a New York corporation, or any successor to its debt rating business.

     “Second Lien Notes” means the Issuer’s $600 million 111/2% Senior
Secured Notes due May 1, 2013 issued under the Second Lien Notes Indenture.

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     “Second Lien Notes Collateral Agent” means the Second Lien Notes Trustee acting as the
collateral agent for the holders of the Second-Priority Lien Obligations and any successor acting
in such capacity.

     “Second Lien Notes Indenture” means the indenture dated as of May 27, 2008, relating to the
Second Lien Notes, among the Issuer, the Company, the guarantors party thereto and the Second Lien
Notes Trustee.

     “Second Lien Notes Trustee” means Wilmington Trust Company, a Delaware banking corporation (as
successor to Deutsche Bank National Trust Company, a national banking association), acting as
trustee for the Second Lien Notes, or any successor acting in such capacity.

     “Second-Priority Lien Obligations” has the meaning ascribed to it in the definition of
“Permitted Liens”.

     “Second-Priority Liens” means all Liens that secure the Second-Priority Lien Obligations.

     “Securities Act” means the Securities Act of 1933, as amended.

     “Security Documents” means (i) the Intercreditor Agreement and (ii) the security documents
granting a security interest in any assets of any Person to secure the Obligations under the Notes
and the Guarantees as each may be amended, restated, supplemented or otherwise modified from time
to time.

     “self-liquidating paper” has the meaning ascribed to it in Section 7.03 hereof.

     “Significant Subsidiary” means any Subsidiary of the Company which would constitute a
“significant subsidiary” as defined in Rule 1-02(w)(1) or (2) of Regulation S-X under the
Securities Act and the Exchange Act as in effect on the Issue Date.

     “Subordinated Indebtedness” means Indebtedness subordinated in right of payment to the Notes
pursuant to a written agreement and includes any Indebtedness ranking equally in right of payment
to the Notes but unsecured or secured by the Collateral on a basis entirely junior to that of the
Notes.

     “Subsidiary” of any Person means any corporation or other entity of which a majority of the
Capital Stock having ordinary voting power to elect a majority of the Board of Directors or other
persons performing similar functions is at the time directly or indirectly owned or controlled by
such Person.

     “Successor” has the meaning ascribed to it in Section 4.14 hereof.

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     “Third-Priority Liens” means all Liens that secure the Third-Priority Lien Obligations.

     “Third-Priority Lien Obligations” means (i) all Indebtedness and other Obligations under the
Indenture, the Notes, the Guarantees and the Security Documents and (ii) any other Indebtedness
secured on a third-priority basis by the Collateral and the Obligations under the indenture under
which such Indebtedness is issued, the guarantees thereof and the security documents related
thereto.

     “Trustee” means the party named as such in the preamble of this Indenture until such time, if
any, a successor replaces such party in accordance with the applicable provisions of the Indenture
and thereafter means the successor serving hereunder.

     “Trust Indenture Act” or “TIA” means the Trust Indenture Act of 1939, as amended.

     “U.S. Government Obligations” means non-callable, non-payable bonds, notes, bills or other
similar obligations issued or guaranteed by the United States government or any agency thereof the
full and timely payment of which are backed by the full faith and credit of the United States.

     “Unrestricted Subsidiary” means any Subsidiary of the Company so designated by a resolution
adopted by the Board of Directors of the Company or a duly authorized committee thereof as provided
below; provided, that (a) the holders of Indebtedness thereof do not have direct or indirect
recourse against the Company, the Issuer or any Restricted Subsidiary, and neither the Company, the
Issuer nor any Restricted Subsidiary otherwise has liability for, any payment obligations in
respect of such Indebtedness (including any undertaking, agreement or instrument evidencing such
Indebtedness), except, in each case, to the extent that the amount thereof constitutes a Restricted
Payment permitted by the Indenture, in the case of Non-Recourse Indebtedness, to the extent such
recourse or liability is for the matters discussed in the last sentence of the definition of
“Non-Recourse Indebtedness,” or to the extent such Indebtedness is a guarantee by such Subsidiary
of Indebtedness of the Company, the Issuer or a Restricted Subsidiary and (b) no holder of any
Indebtedness of such Subsidiary shall have a right to declare a default on such Indebtedness or
cause the payment thereof to be accelerated or payable prior to its stated maturity as a result of
a default on any Indebtedness of the Company, the Issuer or any Restricted Subsidiary. As of the
Issue Date, the Unrestricted Subsidiaries will be the subsidiaries of the Company named in Exhibit
J hereto.

     Subject to the foregoing, the Board of Directors of the Company or a duly authorized committee
thereof may designate any Subsidiary in addition to those named above to be an Unrestricted
Subsidiary; provided, however, that (a) the net

31

 

amount (the “Designation Amount”) then outstanding
of all previous Investments by the Company and the Restricted Subsidiaries in such Subsidiary will
be deemed to be a Restricted Payment at the time of such designation and will reduce the amount
available for Restricted Payments under Section 4.07 hereof to the extent provided therein, (b) the
Company must be permitted under Section 4.07 hereof to make the Restricted Payment deemed to have
been made pursuant to clause (a) of this paragraph, and (c) after giving effect to such
designation, no Default or Event of Default shall have occurred or be continuing. In accordance
with the foregoing, and not in limitation thereof, Investments made by any Person in any Subsidiary
of such Person prior to such Person’s merger with the Company or any Restricted Subsidiary (but not
in contemplation or anticipation of such merger) shall not be counted as an Investment by the
Company or such Restricted Subsidiary if such Subsidiary of such Person is designated as an
Unrestricted Subsidiary.

     The Board of Directors of the Company or a duly authorized committee thereof may also
redesignate an Unrestricted Subsidiary to be a Restricted Subsidiary; provided, however, that (a)
the Indebtedness of such Unrestricted Subsidiary as of the date of such redesignation could then be
incurred under Section 4.06 hereof and (b) immediately after giving effect to such redesignation
and the incurrence of any such additional Indebtedness, the Company and the Restricted Subsidiaries
could incur $1.00 of additional Indebtedness under Section 4.06(a) hereof. Any such designation or
redesignation by the Board of Directors of the Company or a committee thereof will be evidenced to
the Trustee by the filing with the Trustee of a certified copy of the resolution of the Board of
Directors of the Company or a committee thereof giving effect to such designation or redesignation
and an Officers’ Certificate certifying that such designation or redesignation complied with the
foregoing conditions and setting forth the underlying calculations of such Officers’ Certificate.
The designation of any Person as an Unrestricted Subsidiary shall be deemed to include a
designation of all Subsidiaries of such Person as Unrestricted Subsidiaries; provided, however,
that the ownership of the general partnership interest (or a similar member’s interest in a limited
liability company) by an Unrestricted Subsidiary shall not cause a Subsidiary of the Company of
which more than 95% of the equity interest is held by the Company or one or more Restricted
Subsidiaries to be deemed an Unrestricted Subsidiary.

     “Weighted Average Life to Maturity” means, when applied to any Indebtedness or portion thereof
at any date, the number of years obtained by dividing (a) the sum of the products obtained by
multiplying (i) the amount of each then remaining installment, sinking fund, serial maturity or
other required payment of principal, including, without limitation, payment at final maturity, in
respect thereof, by (ii) the number of years (calculated to the nearest one-twelfth) that will
elapse between such date and the making of such payment by (b) the sum of all such payments
described in clause (a)(i) of this definition.

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     “$” means U.S. dollars.

     Section 1.02. Rules of Construction. Unless the context otherwise requires or except as
otherwise expressly provided,

     (a) an accounting term not otherwise defined has the meaning assigned to it in accordance with
GAAP;

     (b) “herein,” “hereof” and other words of similar import refer to the Indenture as a whole and
not to any particular Section, Article other subdivision;

     (c) all references to Sections or Articles or Exhibits refer to Sections or Articles or
Exhibits of or to this Indenture unless otherwise indicated;

     (d) references to agreements or instruments, or to statutes or regulations, are to such
agreements or instruments, or statutes or regulations, as amended from time to time (or to
successor statutes and regulations); and

     (e) in the event that a transaction meets the criteria of more than one category of permitted
transactions or listed exceptions, the Issuer may classify such transaction as it, in its sole
discretion, determines.

ARTICLE 2

The Notes

     Section 2.01. Form, Dating and Denominations; Legends. (a) The Notes and the Trustee’s
certificate of authentication will be substantially in the form attached as Exhibit A. The terms
and provisions contained in the form of the Note annexed as Exhibit A constitute and are hereby
expressly made a part of the Indenture. The Notes may have notations, legends or endorsements
required by this Indenture, law, rules of or agreements with national securities exchanges to which
the Issuer is subject, or usage. Each Note will be dated the date of its authentication. The
Notes will be issuable in denominations of $2,000 in principal amount and any multiple of $1,000 in
excess thereof (and in any multiple of $1.00 principal amount in excess of $2,000 principal amount
or any multiple of $1,000 principal amount, if the Issuer has elected to issue Notes in such
denominations pursuant to Section 2.02).

     (b) (i) Except as otherwise provided in clause (c) of this Section 2.01, Section 2.09(b)(iv),
Section 2.10(b)(iii), Section 2.10(b)(v), or Section 2.10(c), each Initial Note or Initial
Additional Note will bear the Restricted Legend.

          (ii) Each Global Note, whether or not an Original Note or Additional Note, will bear
the DTC Legend.

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          (iii) Each Regulation S Temporary Global Note will bear the Regulation S Temporary
Global Note Legend.

          (iv) Initial Notes and Initial Additional Notes offered and sold (or issued in an
exchange transaction) in reliance on Regulation S will be issued as provided in Section
2.11(a).

          (v) Initial Notes and Initial Additional Notes offered and sold (or issued in an
exchange transaction) in reliance on any exception under the Securities Act other than
Regulation S and Rule 144A will be issued, and upon the request of the Issuer to the
Trustee, Initial Notes and Initial Additional Notes offered and sold (or issued in an
exchange transaction) in reliance on Rule 144A may be issued, in the form of Certificated
Notes.

          (vi) Exchange Notes will be issued, subject to Section 2.09(b), in the form of one or
more Global Notes.

     (c) (i) If the Issuer determines (upon the advice of counsel and after consideration of other
certifications and evidence as the Issuer may reasonably require) that a Note is eligible for
resale pursuant to Rule 144 under the Securities Act (or a successor provision) without being
subject to any conditions as provided in such Rule and that the Restricted Legend is no longer
necessary or appropriate in order to ensure that subsequent transfers of the Note (or a beneficial
interest therein) are effected in compliance with the Securities Act, or

          (ii) after an Initial Note or any Initial Additional Note is

          (A) sold pursuant to an effective registration statement under the
Securities Act, filed pursuant to a Registration Rights Agreement or otherwise,
or

          (B) is validly tendered for an Exchange Note pursuant to an Exchange Offer

then, the Issuer may instruct the Trustee to cancel the Note and issue to the Holder thereof (or to
its transferee) a new Note of like tenor and amount, registered in the name of the Holder thereof
(or its transferee), that does not bear the Restricted Legend, and the Trustee will comply with
such instruction.

     (d) By its acceptance of any Note bearing the Restricted Legend (or any beneficial interest in
such a Note), each Holder thereof and each owner of a beneficial interest therein acknowledges the
restrictions on transfer of such Note (and any such beneficial interest) set forth in this
Indenture and in the Restricted Legend and agrees that it will transfer such Note (and any such
beneficial interest) only in accordance with the Indenture and such legend.

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     Section 2.02. Execution and Authentication; Exchange Notes; Additional Notes. (a) An
Officer shall execute the Notes for the Issuer by facsimile or manual signature in the name and on
behalf of the Issuer. If an Officer whose signature is on a Note no longer holds that office at
the time the Note is authenticated, the Note will still be valid.

     (b) A Note will not be valid until the Trustee manually signs the certificate of
authentication on the Note, with the signature conclusive evidence that the Note has been
authenticated under the Indenture.

     (c) At any time and from time to time after the execution and delivery of the Indenture, the
Issuer may deliver Notes executed by the Issuer to the Trustee for authentication. The Trustee
will authenticate and deliver:

     (i) Initial Notes for original issue in the aggregate principal amount not to exceed
$29,299,000,

     (ii) Initial Additional Notes from time to time for original issue in the aggregate
principal amounts specified by the Issuer, and

     (iii) Exchange Notes from time to time for issue in exchange for a like principal
amount of Initial Notes or Initial Additional Notes

after the following conditions have been met:

     (A) Receipt by the Trustee of a certificate, executed by an Officer
specifying

     (1) the amount of Notes to be authenticated and the date on which
the Notes are to be authenticated,

     (2) whether the Notes are to be Initial Notes, Initial Additional
Notes or Exchange Notes,

     (3) in the case of Initial Additional Notes, that the issuance of
such Notes does not contravene any provision of Article 4,

     (4) whether the Notes are to be issued as one or more Global
Notes or Certificated Notes,

     (5) whether the Notes are to be issued in denominations of $1.00
in excess of $2,000 principal amount or any multiple of $1,000 in
excess thereof; and

35

 

     (6) other information the Issuer may determine to include or the
Trustee may reasonably request.

     (B) In the case of Initial Additional Notes, receipt by the Senior Trustee
of an Opinion of Counsel confirming that the Holders of the outstanding Notes
will be subject to federal income tax in the same amounts, in the same manner
and at the same times as would have been the case if such Initial Additional
Notes were not issued.

     (C) In the case of Exchange Notes, effectiveness of an Exchange Offer
Registration Statement and Consummation (as defined in the applicable
Registration Rights Agreement) of the exchange offer thereunder (and receipt by
the Trustee of an Officers’ Certificate to that effect). Initial Notes or
Initial Additional Notes exchanged for Exchange Notes will be cancelled by the
Trustee, who will dispose of them in accordance with its normal procedures or
the written instructions of the Issuer.

     Section 2.03. Registrar, Paying Agent and Authenticating Agent; Paying Agent to Hold Money in
Trust. (a) The Issuer may appoint one or more Registrars and one or more Paying Agents, and the
Trustee may appoint an Authenticating Agent, in which case each reference in the Indenture to the Trustee in respect of the
obligations of the Trustee to be performed by that Agent will be deemed to be references to the
Agent. The Issuer may act as Registrar or (except for purposes of Article 8) Paying Agent. In
each case, the Issuer and the Trustee will enter into an appropriate agreement with the Agent
implementing the provisions of the Indenture relating to the obligations of the Trustee to be
performed by the Agent and the related rights.

     (b) The Issuer will require each Paying Agent other than the Trustee to agree in writing that
the Paying Agent will hold in trust for the benefit of the Holders or the Trustee all money held by
the Paying Agent for the payment of principal of, premium, if any, and interest and Additional
Interest, if any, on, the Notes and will promptly notify the Trustee of any default by the Issuer
in making any such payment. The Issuer at any time may require a Paying Agent to pay all money
held by it to the Trustee and account for any funds disbursed, and the Trustee may at any time
during the continuance of any payment default, upon written request to a Paying Agent, require the
Paying Agent to pay all money held by it to the Trustee and to account for any funds disbursed.
Upon doing so, the Paying Agent will have no further liability for the money so paid over to the
Trustee.

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     Section 2.04. Replacement Notes. If a mutilated Note is surrendered to the Trustee or if a
Holder claims that its Note has been lost, destroyed or wrongfully taken, the Issuer will issue and
the Trustee will authenticate a replacement Note of like tenor and principal amount and bearing a
number not contemporaneously outstanding. Every replacement Note is an additional obligation of
the Issuer and entitled to the benefits of the Indenture. If required by the Trustee or the
Issuer, an indemnity must be furnished that is sufficient in the judgment of both the Trustee and
the Issuer to protect the Issuer and the Trustee from any loss they may suffer if a Note is
replaced. The Issuer may charge the Holder for the expenses of the Issuer and the Trustee in
replacing a Note. In case the mutilated, lost, destroyed or wrongfully taken Note has become or is
about to become due and payable, the Issuer in its discretion may pay the Note instead of issuing a
replacement Note.

     Section 2.05. Outstanding Notes. (a)  Notes outstanding at any time are all Notes that have
been authenticated by the Trustee except for:

     (i) Notes cancelled by the Trustee or delivered to it for cancellation;

     (ii) any Note which has been replaced pursuant to Section 2.04 unless and until the
Trustee and the Issuer receive proof satisfactory to them that the replaced Note is held
by a protected purchaser; and

     (iii) on or after the maturity date or any redemption date or date for purchase of
the Notes pursuant to an Offer to Purchase, those Notes payable or to be redeemed or purchased on that date for which the Trustee (or Paying
Agent, other than the Issuer or an Affiliate of the Issuer) holds money sufficient to pay
all amounts then due.

     (b) A Note does not cease to be outstanding because the Issuer or one of its Affiliates holds
the Note; provided, that in determining whether the Holders of the requisite principal amount of
the outstanding Notes have given or taken any request, demand, authorization, direction, notice,
consent, waiver or other action hereunder, Notes owned by the Issuer or any Affiliate of the Issuer
will be disregarded and deemed not to be outstanding (it being understood that in determining
whether the Trustee is protected in relying upon any such request, demand, authorization,
direction, notice, consent, waiver or other action, only Notes which a Responsible Officer of the
Trustee knows to be so owned will be so disregarded). Notes so owned which have been pledged in
good faith may be regarded as outstanding if the pledgee establishes to the satisfaction of the
Trustee the pledgee’s right so to act with respect to such Notes and that the pledgee is not the
Issuer or any Affiliate of the Issuer.

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     Section 2.06. Temporary Notes. Until definitive Notes are ready for delivery, the Issuer may
prepare and the Trustee will authenticate temporary Notes. Temporary Notes will be substantially
in the form of definitive Notes but may have insertions, substitutions, omissions and other
variations determined to be appropriate by the Officer executing the temporary Notes, as evidenced
by the execution of the temporary Notes. If temporary Notes are issued, the Issuer will cause
definitive Notes to be prepared without unreasonable delay. After the preparation of definitive
Notes, the temporary Notes will be exchangeable for definitive Notes upon surrender of the
temporary Notes at the office or agency of the Issuer designated for the purpose pursuant to
Section 4.02 without charge to the Holder. Upon surrender for cancellation of any temporary Notes,
the Issuer will execute and the Trustee will authenticate and deliver in exchange therefor a like
principal amount of definitive Notes of authorized denominations. Until so exchanged, the
temporary Notes will be entitled to the same benefits under the Indenture as definitive Notes.

     Section 2.07. Cancellation. The Issuer at any time may deliver to the Trustee for
cancellation any Notes previously authenticated and delivered hereunder which the Issuer may have
acquired in any manner whatsoever, and may deliver to the Trustee for cancellation any Notes
previously authenticated hereunder which the Issuer has not issued and sold. Any Registrar or the
Paying Agent will forward to the Trustee any Notes surrendered to it for transfer, exchange or
payment. The Trustee will cancel all Notes surrendered for transfer, exchange, payment or
cancellation and dispose of them in accordance with its normal procedures or the written
instructions of the Issuer. The Issuer may not issue new Notes to replace Notes that it has paid
in full or delivered to the Trustee for cancellation, except for Exchange Notes.

     Section 2.08. CUSIP and ISIN Numbers. The Issuer in issuing the Notes may use “CUSIP” and
“ISIN” numbers, and the Trustee will use CUSIP numbers or ISIN numbers in notices of redemption or
exchange or in Offers to Purchase as a convenience to Holders, the notice to state that no
representation is made as to the correctness of such numbers either as printed on the Notes or as
contained in any notice of redemption or exchange or Offer to Purchase. The Issuer will promptly
notify the Trustee in writing of any change in the CUSIP or ISIN numbers.

     Section 2.09. Registration, Transfer and Exchange. (a) The Notes will be issued in
registered form only, without coupons, and the Issuer shall cause the Trustee to maintain a
register (the “Register”) of the Notes, for registering the record ownership of the Notes by the
Holders and transfers and exchanges of the Notes.

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     (b) (i) Each Global Note will be registered in the name of the Depositary or its nominee and,
so long as DTC is serving as the Depositary thereof, will bear the DTC Legend.

     (ii) Each Global Note will be delivered to the Trustee as custodian for the
Depositary. Transfers of a Global Note (but not a beneficial interest therein) will be
limited to transfers thereof in whole, but not in part, to the Depositary, its successors
or their respective nominees, except (A) as set forth in Section 2.09(b)(iv) and (B)
transfers of portions thereof in the form of Certificated Notes may be made upon request
of an Agent Member (for itself or on behalf of a beneficial owner) by 20 days’ prior
written notice given to the Trustee by or on behalf of the Depositary in accordance with
customary procedures of the Depositary and in compliance with this Section and Section
2.10.

     (iii) Agent Members will have no rights under the Indenture with respect to any
Global Note held on their behalf by the Depositary, and the Depositary may be treated by
the Issuer, the Trustee and any agent of the Issuer or the Trustee as the absolute owner
and Holder of such Global Note for all purposes whatsoever. Notwithstanding the
foregoing, the Depositary or its nominee may grant proxies and otherwise authorize any
Person (including any Agent Member and any Person that holds a beneficial interest in a
Global Note through an Agent Member) to take any action which a Holder is entitled to take
under the Indenture or the Notes, and nothing herein will impair, as between the
Depositary and its Agent Members, the operation of customary practices governing the
exercise of the rights of a holder of any security.

     (iv) If (x) the Depositary (i) notifies the Issuer that it is unwilling or unable to
continue as Depositary for a Global Note and a successor depositary is not appointed by
the Issuer within 90 days of the notice or (ii) has ceased to be a clearing agency
registered under the Exchange Act, (y) the Issuer, at its option, notifies the Trustee in writing that it
elects to cause the issuance of Certificated Notes or (z) a Default or an Event of Default
with respect to the Notes has occurred and is continuing, the Trustee will promptly
exchange each beneficial interest in the Global Note for one or more Certificated Notes in
authorized denominations having an equal aggregate principal amount registered in the name
of the owner of such beneficial interest, as identified to the Trustee by the Depositary,
and thereupon the Global Note will be deemed canceled. If such Note does not bear the
Restricted Legend, then the Certificated Notes issued in exchange therefor will not bear
the Restricted Legend. If such Note bears the Restricted Legend, then the Certificated
Notes issued in exchange therefor will bear the Restricted Legend; provided, that any Holder of any such Certificated Note issued in

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exchange for a beneficial interest in a
Regulation S Temporary Global Note will have the right upon presentation to the Trustee of
a duly completed Certificate of Beneficial Ownership after the Restricted Period to
exchange such Certificated Note for a Certificated Note of like tenor and amount that does
not bear the Restricted Legend, registered in the name of such Holder.

     (c) Each Certificated Note will be registered in the name of the holder thereof or its
nominee.

     (d) A Holder may transfer a Note (or a beneficial interest therein) to another Person or
exchange a Note (or a beneficial interest therein) for another Note or Notes of any authorized
denomination by presenting to the Trustee a written request therefor stating the name of the
proposed transferee or requesting such an exchange, accompanied by any certification, opinion or
other document required by Section 2.10. The Trustee will promptly register any transfer or
exchange that meets the requirements of this Section and Section 2.10 noting the same in the
register maintained by the Trustee for the purpose; provided, that

     (i) no transfer or exchange will be effective until it is registered in such
register, and

     (ii) the Trustee will not be required (x) to issue, register the transfer of or
exchange any Note for a period of 15 days before a selection of Notes to be redeemed or
purchased pursuant to an Offer to Purchase, (y) to register the transfer of or exchange
any Note so selected for redemption or purchase in whole or in part, except, in the case
of a partial redemption or purchase, that portion of any Note not being redeemed or
purchased, or (z) if a redemption or a purchase pursuant to an Offer to Purchase is to
occur after a Record Date but on or before the corresponding Interest Payment Date, to
register the transfer of or exchange any Note on or after the Record Date and before the
date of redemption or purchase. Prior to the registration of any transfer, the Issuer,
the Trustee and their agents will treat the Person in whose name the Note is registered as the owner and Holder thereof for all purposes (whether or not
the Note is overdue), and will not be affected by notice to the contrary.

     From time to time the Issuer will execute and the Trustee will authenticate additional Notes
as necessary in order to permit the registration of a transfer or exchange in accordance with this
Section.

     No service charge will be imposed in connection with any transfer or exchange of any Note, but
the Issuer or the Trustee may require payment of a sum sufficient to cover any transfer tax or
similar governmental charge payable in

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connection therewith (other than a transfer tax or other
similar governmental charge payable upon exchange pursuant to subsection (b)(iv)).

     (e) (i) Global Note to Global Note. If a beneficial interest in a Global Note is
transferred or exchanged for a beneficial interest in another Global Note, the Trustee
will (x) record a decrease in the principal amount of the Global Note being transferred or
exchanged equal to the principal amount of such transfer or exchange and (y) record a like
increase in the principal amount of the other Global Note. Any beneficial interest in one
Global Note that is transferred to a Person who takes delivery in the form of an interest
in another Global Note, or exchanged for an interest in another Global Note, will, upon
transfer or exchange, cease to be an interest in such Global Note and become an interest
in the other Global Note and, accordingly, will thereafter be subject to all transfer and
exchange restrictions, if any, and other procedures applicable to beneficial interests in
such other Global Note for as long as it remains such an interest.

     (ii) Global Note to Certificated Note. If a beneficial interest in a Global Note is
transferred or exchanged for a Certificated Note, the Trustee will (x) record a decrease
in the principal amount of such Global Note equal to the principal amount of such transfer
or exchange and (y) deliver one or more new Certificated Notes in authorized denominations
having an equal aggregate principal amount to the transferee (in the case of a transfer)
or the owner of such beneficial interest (in the case of an exchange), registered in the
name of such transferee or owner, as applicable.

     (iii) Certificated Note to Global Note. If a Certificated Note is transferred or
exchanged for a beneficial interest in a Global Note, the Trustee will (x) cancel such
Certificated Note, (y) record an increase in the principal amount of such Global Note
equal to the principal amount of such transfer or exchange and (z) in the event that such
transfer or exchange involves less than the entire principal amount of the canceled
Certificated Note, deliver to the Holder thereof one or more new Certificated Notes in
authorized denominations having an aggregate principal amount equal to the untransferred or unexchanged portion of the canceled
Certificated Note, registered in the name of the Holder thereof.

     (iv) Certificated Note to Certificated Note. If a Certificated Note is transferred
or exchanged for another Certificated Note, the Trustee will (x) cancel the Certificated
Note being transferred or exchanged, (y) deliver one or more new Certificated Notes in
authorized denominations having an aggregate principal amount equal to the principal
amount of such transfer or exchange to the transferee (in the case of a transfer) or the

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Holder of the canceled Certificated Note (in the case of an exchange), registered in the
name of such transferee or Holder, as applicable, and (z) if such transfer or exchange
involves less than the entire principal amount of the canceled Certificated Note, deliver
to the Holder thereof one or more Certificated Notes in authorized denominations having an
aggregate principal amount equal to the untransferred or unexchanged portion of the
canceled Certificated Note, registered in the name of the Holder thereof.

     Section 2.10. Restrictions on Transfer and Exchange. (a) The transfer or exchange of any
Note (or a beneficial interest therein) may only be made in accordance with this Section and
Section 2.09 and, in the case of a Global Note (or a beneficial interest therein), the applicable
rules and procedures of the Depositary. The Trustee shall refuse to register any requested
transfer or exchange that does not comply with the preceding sentence.

     (b) Subject to paragraph (c) of this Section, the transfer or exchange of any Note (or a
beneficial interest therein) of the type set forth in column A below for a Note (or a beneficial
interest therein) of the type set forth opposite in column B below may only be made in compliance
with the certification requirements (if any) described in the clause of this paragraph set forth
opposite in column C below.

	 	 	 	 	 
	A	 	B	 	C
	Rule 144A Global Note

	 	Rule 144A Global Note
	 	(i)
	Rule 144A Global Note

	 	Regulation S Global Note
	 	(ii)
	Rule 144A Global Note

	 	Certificated Note
	 	(iii)
	Regulation S Global Note

	 	Rule 144A Global Note
	 	(iv)
	Regulation S Global Note

	 	Regulation S Global Note
	 	(i)
	Regulation S Global Note

	 	Certificated Note
	 	(v)
	Certificated Note

	 	Rule 144A Global Note
	 	(iv)
	Certificated Note

	 	Regulation S Global Note
	 	(ii)
	Certificated Note

	 	Certificated Note
	 	(iii)

     (i) No certification is required.

     (ii) The Person requesting the transfer or exchange must deliver or cause to be
delivered to the Trustee a duly completed Regulation S Certificate; provided, that if the requested transfer or exchange is
made by the Holder of a Certificated Note that does not bear the Restricted Legend, then
no certification is required.

     (iii) The Person requesting the transfer or exchange must deliver or cause to be
delivered to the Trustee (x) a duly completed Rule 144A Certificate, (y) a duly completed
Regulation S Certificate or (z) a duly completed Institutional Accredited Investor
Certificate, and/or an

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opinion of counsel and such other certifications and evidence as
the Issuer or the Trustee may reasonably require in order to determine that the proposed
transfer or exchange is being made in compliance with the Securities Act and any
applicable securities laws of any state of the United States; provided, that if the
requested transfer or exchange is made by the Holder of a Certificated Note that does not
bear the Restricted Legend, then no certification is required. In the event that a Rule
144A Global Note or a Certificated Note that does not bear the Restricted Legend is
surrendered for transfer or exchange, upon transfer or exchange the Trustee will deliver a
Certificated Note that does not bear the Restricted Legend.

     (iv) The Person requesting the transfer or exchange must deliver or cause to be
delivered to the Trustee a duly completed Rule 144A Certificate and must comply with all
applicable securities laws of any state of the United States or any other jurisdiction.

     (v) If the requested transfer involves a beneficial interest in a Regulation S
Temporary Global Note, the Person requesting the registration of transfer must deliver or
cause to be delivered to the Trustee (x) a duly completed Rule 144A Certificate or (y) a
duly completed Institutional Accredited Investor Certificate and/or an opinion of counsel
and such other certifications and evidence as the Issuer or the Trustee may reasonably
require in order to determine that the proposed transfer is being made in compliance with
the Securities Act and any applicable securities laws of any state of the United States.
If the requested transfer or exchange involves a beneficial interest in a Permanent
Regulation S Global Note, no certification is required and the Trustee will deliver a
Certificated Note that does not bear the Restricted Legend. Notwithstanding anything to
the contrary contained herein, no such exchange is permitted if the requested exchange
involves a beneficial interest in a Regulation S Temporary Global Note.

     (c) No certification is required in connection with any transfer or exchange of any Note (or a
beneficial interest therein)

     (i) after such Note is eligible for resale pursuant to Rule 144 under the Securities
Act (or a successor provision) without being subject to any conditions as provided in such
Rule; provided, that the Issuer has provided the Trustee with a certificate to that effect, and the Issuer or the Trustee
may require from any Person requesting a transfer or exchange in reliance upon this clause
(i) an opinion of counsel and any other reasonable certifications and evidence in order to
support such certificate; or

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     (ii) (A) sold pursuant to an effective registration statement under the Securities
Act, filed pursuant to a Registration Rights Agreement or otherwise or (B) which is
validly tendered for exchange into an Exchange Note pursuant to an Exchange Offer.

     Any Certificated Note delivered in reliance upon this paragraph will not bear the Restricted
Legend.

     (d) The Trustee will retain copies of all certificates, opinions and other documents received
in connection with the registration of transfer or exchange of a Note (or a beneficial interest
therein), and the Issuer will have the right to inspect and make copies thereof at any reasonable
time upon written notice to the Trustee.

     Section 2.11. Regulation S Temporary Global Notes. (a) Each Initial Note and Initial
Additional Note originally sold (or issued in an exchange transaction) in reliance upon Regulation
S will be evidenced by one or more Regulation S Global Notes that bear the Regulation S Temporary
Global Note Legend.

     (b) An owner of a beneficial interest in a Regulation S Temporary Global Note (or a Person
acting on behalf of such an owner) may provide to the Trustee (and the Trustee will accept) a duly
completed Certificate of Beneficial Ownership at any time after the Restricted Period (it being
understood that the Trustee will not accept any such certificate during the Restricted Period).
Promptly after acceptance of a Certificate of Beneficial Ownership with respect to such a
beneficial interest, the Trustee will cause such beneficial interest to be exchanged for an
equivalent beneficial interest in a Permanent Regulation S Global Note, and will (x) permanently
reduce the principal amount of such Regulation S Temporary Global Note by the amount of such
beneficial interest and (y) increase the principal amount of such Permanent Regulation S Global
Note by the amount of such beneficial interest.

     (c) Notwithstanding anything to the contrary contained herein, beneficial interests in a
Regulation S Temporary Global Note may be held through the Depositary only through Euroclear or
Clearstream and their respective direct and indirect participants.

     (d) Notwithstanding paragraph (b), if after the Restricted Period any Initial Purchaser owns a
beneficial interest in a Regulation S Temporary Global Note, such Initial Purchaser may, upon
written request to the Trustee accompanied by a certification as to its status as an Initial Purchaser, exchange such
beneficial interest for an equivalent beneficial interest in a Permanent Regulation S Global Note,
and the Trustee will comply with such request and will (x) permanently reduce the principal amount
of such Regulation S Temporary

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Global Note by the amount of such beneficial interest and (y)
increase the principal amount of such Permanent Regulation S Global Note by the amount of such
beneficial interest.

ARTICLE 3

Redemption; Offer to Purchase

     Section 3.01. Optional Redemption. At any time and from time to time on or after May 1,
2011, the Issuer may redeem the Notes, in whole or in part, at a redemption price equal to the
percentage of principal amount set forth below plus accrued and unpaid interest and Additional
Interest thereon, if any, to the applicable redemption date.

	 	 	 	 	 
	Year	 	Percentage
	May 1, 2011
	 	 	102	%
	November 1, 2011
	 	 	101	%
	November 1, 2012
	 	 	100	%

     Section 3.02. Redemption with Proceeds of Equity Offering. At any time and from time to time
prior to May 1, 2011, the Issuer may redeem Notes with the net cash proceeds received by the Issuer
from any Equity Offering at a redemption price equal to 118.0% of the principal amount plus accrued
and unpaid interest to the redemption date, in an aggregate principal amount for all such
redemptions not to exceed 35% of the original aggregate principal amount of the Notes, provided
that:

     (i) in each case the redemption takes place not later than 60 days after the closing
of the related Equity Offering, and

     (ii) not less than 65% of the original aggregate principal amount of the Notes
remains outstanding immediately thereafter.

     Section 3.03. Sinking Fund; Mandatory Redemption. There is no sinking fund for, or mandatory
redemption of, the Notes.

     Section 3.04. Method and Effect of Redemption. (a) If the Issuer elects to redeem Notes, it
must notify the Trustee of the redemption date and the principal amount of Notes to be redeemed by
delivering an Officers’ Certificate at least 45 days before the redemption date (unless a shorter
period is satisfactory to the Trustee). If fewer than all of the Notes are being redeemed, the
Officers’ Certificate must also specify a record date not less than 15 days after the date of the
notice of redemption is given to the Trustee, and the Trustee will select the Notes to be redeemed
pro rata, or as nearly a pro rata basis as is practicable (subject to the procedures of DTC), unless such method is otherwise prohibited, in which case,
by lot or by any other method the Trustee in its sole discretion deems

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fair and appropriate, in
denominations of $2,000 principal amount or any multiple of $1,000 in excess thereof (and in any
multiple of $1.00 principal amount in excess of $2,000 principal amount or any multiple of $1,000
principal amount, if the Issuer has elected to issue Notes in such denominations pursuant to
Section 2.02). The Trustee will notify the Issuer promptly of the Notes or portions of Notes to be
called for redemption. Notice of redemption must be sent by the Issuer or, at the Issuer’s
request, by the Trustee in the name and at the expense of the Issuer to Holders whose Notes are to
be redeemed at least 30 days but not more than 60 days before the redemption date. Notices of
redemption may not be conditional.

     (b) The notice of redemption will identify the Notes to be redeemed and will include or state
the following:

     (i) the redemption date;

     (ii) the redemption price, including the portion thereof representing any accrued
interest or Additional Interest, if any;

     (iii) the place or places where Notes are to be surrendered for redemption (Notes
called for redemption must be so surrendered in order to collect the redemption price);

     (iv) that on the redemption date, the redemption price will become due and payable on
Notes called for redemption, and interest on Notes called for redemption will cease to
accrue on and after the redemption date;

     (v) that if any Note is redeemed in part, the portion of the principal amount thereof
to be redeemed, and that on and after the redemption date, upon surrender of such Note,
new Notes equal in principal amount to the unredeemed portion will be issued; and

     (vi) if any Note contains a CUSIP or ISIN number, no representation is being made as
to the correctness of the CUSIP or ISIN number either as printed on the Notes or as
contained in the notice of redemption and that the Holder should rely only on the other
identification numbers printed on the Notes.

     (c) Once notice of redemption is sent to the Holders, Notes called for redemption become due
and payable at the redemption price on the redemption date, and upon surrender of the Notes called
for redemption, the Issuer shall redeem such Notes at the redemption price. Commencing on the
redemption date, Notes redeemed will cease to accrue interest. Upon surrender of any Note redeemed
in part, the Holder will receive a new Note equal in principal amount to the unredeemed portion of
the surrendered Note.

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     Section 3.05. Offer to Purchase. (a) An “Offer to Purchase” means an offer by the Issuer to
purchase Notes as required by the Indenture. An Offer to Purchase must be made by written offer
(the “offer”) sent to the Holders. The Issuer will notify the Trustee at least 15 days (or such
shorter period as is acceptable to the Trustee) prior to sending the offer to Holders of its
obligation to make an Offer to Purchase, and the offer will be sent by the Issuer or, at the
Issuer’s request, by the Trustee in the name and at the expense of the Issuer.

     (b) The offer must include or state the following as to the terms of the Offer to Purchase:

     (i) the provision of the Indenture pursuant to which the Offer to Purchase is being
made;

     (ii) the aggregate principal amount of the outstanding Notes offered to be purchased
by the Issuer pursuant to the Offer to Purchase (including, if less than 100%, the manner
by which such amount has been determined pursuant to the Indenture) (the “purchase
amount”);

     (iii) the purchase price, including the portion thereof representing accrued interest
and Additional Interest, if any;

     (iv) an expiration date (the “expiration date”) not less than 30 days or more than 60
days after the date of the offer, and a settlement date for purchase (the “purchase date”)
not more than five Business Days after the expiration date;

     (v) information concerning the business of the Company, the Issuer and its
Subsidiaries which the Issuer in good faith believes will enable the Holders to make an
informed decision with respect to the Offer to Purchase, at a minimum to include:

     (A) the most recent annual and quarterly financial statements and
“Management’s Discussion and Analysis of Financial Condition and Results of
Operations” for the Company,

     (B) a description of material developments in the Company’s business
subsequent to the date of the latest of the financial statements (including a
description of the events requiring the Issuer to make the Offer to Purchase),
and

     (C) if applicable, appropriate pro forma financial information concerning
the Offer to Purchase and the events requiring the Issuer to make the Offer to
Purchase;

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     (vi) a Holder may tender all or any portion of its Notes, subject to the requirement
that any portion of a Note tendered must be in denominations of $2,000 principal amount
and any multiple of $1,000 in excess thereof (and in any multiple of $1.00 principal amount in excess of $2,000
principal amount or any multiple of $1,000 principal amount, if the Issuer has elected to
issue Notes in such denominations pursuant to Section 2.02);

     (vii) the place or places where Notes are to be surrendered for tender pursuant to
the Offer to Purchase;

     (viii) each Holder electing to tender a Note pursuant to the offer will be required
to surrender such Note at the place or places specified in the offer prior to the close of
business on the expiration date (such Note being, if the Issuer or the Trustee so
requires, duly endorsed or accompanied by a duly executed written instrument of transfer);

     (ix) interest on any Note not tendered, or tendered but not purchased by the Issuer
pursuant to the Offer to Purchase, will continue to accrue;

     (x) on the purchase date the purchase price will become due and payable on each Note
accepted for purchase, and interest on Notes purchased will cease to accrue on and after
the purchase date;

     (xi) Holders are entitled to withdraw Notes tendered by giving notice, which must be
received by the Issuer or the Trustee not later than the close of business on the
expiration date, setting forth the name of the Holder, the principal amount of the
tendered Notes, the certificate number of the tendered Notes and a statement that the
Holder is withdrawing all or a portion of the tender;

     (xii) (A) if Notes in an aggregate principal amount less than or equal to the
purchase amount are duly tendered and not withdrawn pursuant to the Offer to Purchase, the
Issuer will purchase all such Notes, and (B) if the Offer to Purchase is for less than all
of the outstanding Notes and Notes in an aggregate principal amount in excess of the
purchase amount are tendered and not withdrawn pursuant to the offer, the Issuer will
purchase Notes having an aggregate principal amount equal to the purchase amount on a pro
rata basis, with adjustments so that only Notes in denominations of $2,000 principal
amount and any multiples of $1,000 in excess thereof (and in any multiple of $1.00
principal amount in excess of $2,000 principal amount or any multiple of $1,000 principal
amount, if the Issuer has elected to issue Notes in such denominations pursuant to Section
2.02);

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     (xiii) if any Note is purchased in part, new Notes equal in principal amount to the
unpurchased portion of the Note will be issued; and

     (xiv) if any Note contains a CUSIP or ISIN number, no representation is being made as
to the correctness of the CUSIP or ISIN number either as printed on the Notes or as
contained in the offer and that the Holder should rely only on the other identification
numbers printed on the Notes.

     (c) Prior to the purchase date, the Issuer will accept tendered Notes for purchase as required
by the Offer to Purchase and deliver to the Trustee all Notes so accepted together with an
Officers’ Certificate specifying which Notes have been accepted for purchase. On the purchase
date, the purchase price will become due and payable on each Note accepted for purchase, and
interest on Notes purchased will cease to accrue on and after the purchase date. The Trustee will
promptly return to Holders any Notes not accepted for purchase and send to Holders new Notes equal
in principal amount to any unpurchased portion of any Notes accepted for purchase in part.

     (d) The Issuer will comply with Rule 14e-1 under the Exchange Act and all other applicable
laws in making any Offer to Purchase, and the above procedures will be deemed modified as necessary
to permit such compliance.

ARTICLE 4

Covenants

     Section 4.01. Payment of Notes. (a)  The Issuer agrees to pay the principal of, premium, if
any, and interest and Additional Interest, if any, on the Notes on the dates and in the manner
provided in the Notes and the Indenture. The Issuer shall pay Additional Interest, if any, in the
amounts set forth in the applicable Registration Rights Agreement. Not later than 9:00 A.M. (New
York City time) on the due date of any principal of, premium, if any, or interest and Additional
Interest, if any, on, any Notes, or any redemption or purchase price of the Notes, the Issuer will
deposit with the Trustee (or Paying Agent) money in immediately available funds sufficient to pay
such amounts; provided, that if the Issuer or any Affiliate of the Issuer is acting as Paying
Agent, it will, on or before each due date, segregate and hold in a separate trust fund for the
benefit of the Holders a sum of money sufficient to pay such amounts until paid to such Holders or
otherwise disposed of as provided in the Indenture. In each case, the Issuer will promptly notify
the Trustee of its compliance with this paragraph.

     (b) An installment of principal, premium, if any, or interest and Additional Interest, if any,
will be considered paid on the date due if the Trustee (or Paying Agent, other than the Issuer or
any Affiliate of the Issuer) holds on that

49

 

date money designated for and sufficient to pay the
installment. If the Issuer or any Affiliate of the Issuer acts as Paying Agent, an installment of
principal, premium, if any, or interest and Additional Interest, if any, will be considered paid on
the due date only if paid to the Holders.

     (c) The Issuer agrees to pay interest on overdue principal, and, to the extent lawful, overdue
installments of interest and Additional Interest, if any, at the rate per annum specified in the
Notes.

     (d) Payments in respect of the Notes represented by the Global Notes are to be made by wire
transfer of immediately available funds to the accounts specified by the Holders of the Global
Notes. With respect to Certificated Notes, the Issuer will make all payments by wire transfer of
immediately available funds to the accounts specified by the Holders thereof or, if no such account
is specified, by mailing a check to each Holder’s registered address.

     Section 4.02. Maintenance of Office or Agency. The Company and the Issuer will maintain an
office or agency where Notes may be surrendered for registration of transfer or exchange or for
presentation for payment and where notices and demands to or upon the Company and the Issuer in
respect of the Notes and the Indenture may be served. The Issuer and the Company hereby initially
designate the Corporate Trust Office of the Trustee as such office of the Issuer and the Company.
The Issuer will give prompt written notice to the Trustee of the location, and any change in the
location, of such office or agency. If at any time the Issuer and the Company fail to maintain any
such required office or agency or fail to furnish the Trustee with the address thereof, such
presentations, surrenders, notices and demands may be made or served to the Trustee.

     The Issuer may also from time to time designate one or more other offices or agencies where
the Notes may be surrendered or presented for any of such purposes and may from time to time
rescind such designations. The Issuer will give prompt written notice to the Trustee of any such
designation or rescission and of any change in the location of any such other office or agency.

     Section 4.03. Existence. The Company and the Issuer will each do or cause to be done all
things necessary to preserve and keep in full force and effect their existence and the existence of
each of the Restricted Subsidiaries in accordance with their respective organizational documents,
and the material rights, licenses and franchises of the Company, the Issuer and each Restricted
Subsidiary; provided, that the Company and the Issuer are not required to preserve any such right,
license or franchise, or the existence of any Restricted Subsidiary, if the maintenance or
preservation thereof is no longer desirable in the conduct of the business of the Company and its
Restricted Subsidiaries taken as a

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whole; and provided, further, that this Section not prohibit any
transaction otherwise permitted by Section 4.10 or Section 4.14.

     Section 4.04. Payment of Taxes and Other Claims. The Company will pay or discharge, and
cause each of its Subsidiaries to pay or discharge before the same become delinquent (a) all
material taxes, assessments and governmental charges levied or imposed upon the Company or any
Subsidiary or its income or profits or property, and (b) all material lawful claims for labor,
materials and supplies that, if unpaid, might by law become a Lien upon the property of the Company or any
Subsidiary, other than any such tax, assessment, charge or claim the amount, applicability or
validity of which is being contested in good faith by appropriate proceedings and for which
adequate reserves have been established.

     Section 4.05. Maintenance of Properties and Insurance. (a) The Company will cause all
properties used or useful in the conduct of its business or the business of any of its Restricted
Subsidiaries to be maintained and kept in good condition, repair and working order as in the
judgment of the Company may be necessary so that the business of the Company and its Restricted
Subsidiaries may be properly and advantageously conducted at all times; provided, that nothing in
this Section prevents the Company or any Restricted Subsidiary from discontinuing the use,
operation or maintenance of any of such properties or disposing of any of them, if such
discontinuance or disposal is, in the judgment of the Company, desirable in the conduct of the
business of the Company and its Restricted Subsidiaries taken as a whole.

     (b) The Company will provide or cause to be provided, for itself and its Restricted
Subsidiaries, insurance (including appropriate self-insurance) against loss or damage of the kinds
customarily insured against by corporations similarly situated and owning like properties,
including, but not limited to, products liability insurance and public liability insurance, with
reputable insurers, in such amounts, with such deductibles and by such methods as are customary for
corporations similarly situated in the industry in which the Company and its Restricted
Subsidiaries are then conducting business.

     Section 4.06. Limitations on Indebtedness. (a) The Company and the Issuer will not, and
will not cause or permit any Restricted Subsidiary, directly or indirectly, to create, incur,
assume, become liable for or guarantee the payment of (collectively, an “incurrence”) any
Indebtedness (including Acquired Indebtedness) unless, after giving effect thereto and the
application of the proceeds therefrom, the Consolidated Fixed Charge Coverage Ratio on the date
thereof would be at least 2.0 to 1.0.

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     (b) Notwithstanding the foregoing, the provisions of the Indenture will not prevent the
incurrence of:

     (i) Permitted Indebtedness,

     (ii) Refinancing Indebtedness,

     (iii) Non-Recourse Indebtedness,

     (iv) any Guarantee of Indebtedness represented by the Notes, and

     (v) any guarantee of Indebtedness incurred under Credit Facilities in compliance with
the Indenture.

     (c) For purposes of determining compliance with this covenant, in the event that an item of
Indebtedness may be incurred through the first paragraph of this covenant or by meeting the
criteria of one or more of the types of Indebtedness described in the second paragraph of this
covenant (or the definitions of the terms used therein), the Company, in its sole discretion,

     (i) may classify such item of Indebtedness under and comply with either of such
paragraphs (or any of such definitions), as applicable,

     (ii) may classify and divide such item of Indebtedness into more than one of such
paragraphs (or definitions), as applicable, and

     (iii) may elect to comply with such paragraphs (or definitions), as applicable, in
any order.

     (d) The Company and the Issuer will not, and will not cause or permit any Guarantor to,
directly or indirectly, in any event incur any Indebtedness that purports to be by its terms (or by
the terms of any agreement governing such Indebtedness) subordinated to any other Indebtedness of
the Company or of such Guarantor, as the case may be, unless such Indebtedness is also by its terms
(or by the terms of any agreement governing such Indebtedness) made expressly subordinated to the
Notes or the Guarantee of such Guarantor, as the case may be, to the same extent and in the same
manner as such Indebtedness is subordinated to such other Indebtedness of the Company or such
Guarantor, as the case may be.

     Section 4.07. Limitations on Restricted Payments. (a) The Company and the Issuer will not,
and will not cause or permit any Restricted Subsidiary to, directly or indirectly, make any
Restricted Payment unless:

     (i) no Default or Event of Default shall have occurred and be continuing at the time
of or immediately after giving effect to such Restricted Payment;

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     (ii) immediately after giving effect to such Restricted Payment, the Company could
incur at least $1.00 of Indebtedness pursuant to Section 4.06(a) hereof; and

     (iii) immediately after giving effect to such Restricted Payment, the aggregate
amount of all Restricted Payments (including the Fair Market Value of any non-cash
Restricted Payment) declared or made on or after the Issue Date does not exceed the sum
of:

     (A) 50% of the Consolidated Net Income of the Company on a cumulative basis
during the period (taken as one accounting period) from and including November
1, 2008 and ending on the last day of the Company’s fiscal quarter immediately
preceding the date of such Restricted Payment (or in the event such Consolidated Net Income shall be a deficit, minus 100% of
such deficit), plus

     (B) 100% of the aggregate net cash proceeds of and the Fair Market Value of
Property received by the Company from (1) any capital contribution to the
Company after the Issue Date or any issue or sale after the Issue Date of
Qualified Stock (other than (x) to any Subsidiary of the Company or (y) any
Excluded Contribution) and (2) the issue or sale after the Issue Date of any
Indebtedness or other securities of the Company convertible into or exercisable
for Qualified Stock of the Company that have been so converted or exercised, as
the case may be, plus

     (C) in the case of the disposition or repayment of any Investment
constituting a Restricted Payment (or if the Investment was made prior to the
Issue Date, that would have constituted a Restricted Payment if made after the
Issue Date, if such disposition or repayment results in cash received by the
Company, the Issuer or any Restricted Subsidiary), an amount (to the extent not
included in the calculation of Consolidated Net Income referred to in (A)) equal
to the lesser of (x) the return of capital with respect to such Investment
(including by dividend, distribution or sale of Capital Stock) and (y) the
amount of such Investment that was treated (or would have been treated when
made) as a Restricted Payment, in either case, less the cost of the disposition
or repayment of such Investment (to the extent not included in the calculation
of Consolidated Net Income referred to in (A)), plus

     (D) with respect to any Unrestricted Subsidiary that is redesignated as a
Restricted Subsidiary after the Issue Date, in

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accordance with the definition of
“Unrestricted Subsidiary” (so long as the designation of such Subsidiary as an
Unrestricted Subsidiary was treated as a Restricted Payment made after the Issue
Date, and only to the extent not included in the calculation of Consolidated Net
Income referred to in (A)), an amount equal to the lesser of (x) the
proportionate interest of the Company or a Restricted Subsidiary in an amount
equal to the excess of (I) the total assets of such Subsidiary, valued on an
aggregate basis at the lesser of book value and Fair Market Value thereof, over
(II) the total liabilities of such Subsidiary, determined in accordance with
GAAP, and (y) the Designation Amount at the time of such Subsidiary’s
designation as an Unrestricted Subsidiary.

     (b) clauses (ii) and (iii) of Section 4.07(a) will not prohibit:

     (i) the payment of any dividend within 60 days of its declaration if such dividend
could have been made on the date of its declaration without violation of the provisions of
the Indenture;

     (ii) the purchase, repayment, repurchase, redemption, defeasance or other acquisition
or retirement of any Subordinated Indebtedness of the Issuer, the Company or any
Restricted Subsidiary or shares of Capital Stock of the Company in exchange for, or out of
the net proceeds of the substantially concurrent sale (other than to a Subsidiary of the
Company or constituting an Excluded Contribution) of, other shares of Qualified Stock;

     (iii) (A) the purchase, repayment, redemption, repurchase, defeasance or other
acquisition or retirement for value of Subordinated Indebtedness of the Issuer, the
Company or any Restricted Subsidiary in exchange for, or out of proceeds of, Refinancing
Indebtedness;

     (B) the purchase, repayment, redemption, repurchase, defeasance or other
acquisition or retirement for value of Subordinated Indebtedness of the Issuer,
the Company or any Restricted Subsidiary or the making of Restricted Investments
in joint ventures:

     (1) in an aggregate amount not to exceed $50.0 million (after
giving effect to all subsequent reductions in the amount of any
Restricted Investment in a joint venture made pursuant to this clause
(B)(1) as a result of the repayment or disposition thereof for cash,
not to exceed the amount of such Restricted Investment previously made
pursuant to this clause (B)(1)); or

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     (2) in an aggregate amount made under this clause (B)(2) not to
exceed Excluded Contributions (after giving effect to all subsequent
reductions in the amount of any Restricted Investment in a joint
venture made pursuant to this clause (B)(2) as a result of the
repayment or disposition thereof for cash, not to exceed the amount of
such Restricted Investment previously made pursuant to this clause
(B)(2)); and

     (C) the purchase, repayment, redemption, repurchase, defeasance or other
acquisition or retirement for value of Subordinated Indebtedness of the Issuer,
the Company or any Restricted Subsidiary or the making of Restricted Investments
in joint ventures (after giving effect to all subsequent reductions in the
amount of any Restricted Investment in a joint venture made pursuant to this
clause (C) as a result of the repayment or disposition thereof for cash, not to exceed the amount of such Restricted
Investment previously made pursuant to this clause (C)), in an aggregate amount
not to exceed $400.0 million less the aggregate amount of Restricted Payments
previously made under clause (iii)(B)(1) of this Section 4.07(b); provided that,
on a pro forma basis after giving effect to any such Restricted Payment, the
aggregate fair market value of the Collateral (as determined in good faith by
the Company’s chief financial officer) is equal to at least 200% of the
aggregate principal amount of Collateralized Debt as of such date (or, in the
case of a Restricted Investment in a joint venture, on the date the Company
determines to make such Investment, so long as the Investment is completed
within 120 days of such determination date), such fair market value to be
determined by the most recent appraisal of the Collateral required to be
provided under the Revolving Credit Agreement;

     (iv) the payment of dividends on Preferred Stock and Disqualified Stock up to an
aggregate amount of $10 million in any fiscal year; provided that immediately after giving
effect to any declaration of such dividend, the Company could incur at least $1.00 of
Indebtedness pursuant to Section 4.06(a); and

     (v) the purchase, redemption or other acquisition, cancellation or retirement for
value of Capital Stock, or options, warrants, equity appreciation rights or other rights
to purchase or acquire Capital Stock, of the Company or any Subsidiary held by officers or
employees or former officers or employees of the Company or any Subsidiary (or their
estates or beneficiaries under their estates) not to exceed $10 million in the aggregate
since the Issue Date;

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provided, however, that each Restricted Payment described in clauses (i) and (ii) of this Section
4.07(b) shall be taken into account for purposes of computing the aggregate amount of all
Restricted Payments pursuant to clause (iii) of Section 4.07(a).

     (c) For purposes of determining the aggregate and permitted amounts of Restricted Payments
made, the amount of any guarantee of any Investment in any Person that was initially treated as a
Restricted Payment and which was subsequently terminated or expired, net of any amounts paid by the
Company or any Restricted Subsidiary in respect of such guarantee, shall be deducted.

     (d) In determining the “Fair Market Value of Property” for purposes of clause (iii) of Section
4.07(a), Property other than cash, Cash Equivalents and Marketable Securities shall be deemed to be
equal in value to the “equity value” of the Capital Stock or other securities issued in exchange
therefor. The equity value of such Capital Stock or other securities shall be equal to (i) the
number of shares of Common Equity issued in the transaction (or issuable upon conversion or exercise of the Capital Stock or other securities issued in the transaction) multiplied by
the closing sale price of the Common Equity on its principal market on the date of the transaction
(less, in the case of Capital Stock or other securities which require the payment of consideration
at the time of conversion or exercise, the aggregate consideration payable thereupon) or (ii) if
the Common Equity is not then traded on the New York Stock Exchange, American Stock Exchange or
Nasdaq Stock Market, or if the Capital Stock or other securities issued in the transaction do not
consist of Common Equity (or Capital Stock or other securities convertible into or exercisable for
Common Equity), the value (if more than $10 million) of such Capital Stock or other securities as
determined by a nationally recognized investment banking firm retained by the Board of Directors of
the Company.

     Section 4.08. Limitations on Liens. The Company and the Issuer will not, and will not cause
or permit any Restricted Subsidiary to, create, incur, assume or suffer to exist any Liens, other
than Permitted Liens, on any of its Property, or on any shares of Capital Stock or Indebtedness of
any Restricted Subsidiary.

     Section 4.09. Limitations on Restrictions Affecting Restricted Subsidiaries. The Company and
the Issuer will not, and will not cause or permit any Restricted Subsidiary to, create, assume or
otherwise cause or suffer to exist or become effective any consensual encumbrance or restriction
(other than encumbrances or restrictions imposed by law or by judicial or regulatory action or by
provisions of agreements that restrict the assignability thereof) on the ability of any Restricted
Subsidiary to:

     (a) pay dividends or make any other distributions on its Capital Stock or any other interest
or participation in, or measured by, its profits, owned by the

56

 

Company or any other Restricted
Subsidiary, or pay interest on or principal of any Indebtedness owed to the Company or any other
Restricted Subsidiary,

     (b) make loans or advances to the Company or any other Restricted Subsidiary, or

     (c) transfer any of its property or assets to the Company or any other Restricted Subsidiary,

     except for:

     (i) encumbrances or restrictions existing under or by reason of applicable law,

     (ii) contractual encumbrances or restrictions in effect at or entered into on the
Issue Date and any amendments, modifications, restatements, renewals, supplements,
refundings, replacements or refinancings thereof; provided, that such amendments,
modifications, restatements, renewals, supplements, refundings, replacements or
refinancings are no more restrictive, taken as a whole, with respect to such dividend and other payment restrictions than those contained in such contractual
encumbrances or restrictions, as in effect at or entered into on the Issue Date,

     (iii) any restrictions or encumbrances arising under Acquired Indebtedness; provided,
that such encumbrance or restriction applies only to either the assets that were subject
to the restriction or encumbrance at the time of the acquisition or the obligor on such
Indebtedness and its Subsidiaries prior to such acquisition,

     (iv) any restrictions or encumbrances arising in connection with Refinancing
Indebtedness; provided, however, that any restrictions and encumbrances of the type
described in this clause (iv) that arise under such Refinancing Indebtedness shall not be
materially more restrictive or apply to additional assets than those under the agreement
creating or evidencing the Indebtedness being refunded, refinanced, replaced or extended,

     (v) any Permitted Lien, or any other agreement restricting the sale or other
disposition of property, securing Indebtedness permitted by the Indenture if such
Permitted Lien or agreement does not expressly restrict the ability of a Subsidiary of the
Company to pay dividends or make or repay loans or advances prior to default thereunder,

     (vi) reasonable and customary borrowing base covenants set forth in agreements
evidencing Indebtedness otherwise permitted by the Indenture,

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     (vii) customary non-assignment provisions in leases, licenses, encumbrances,
contracts or similar assets entered into or acquired in the ordinary course of business,

     (viii) any restriction with respect to a Restricted Subsidiary imposed pursuant to an
agreement entered into for the sale or disposition of all or substantially all of the
Capital Stock or assets of such Restricted Subsidiary pending the closing of such sale or
disposition,

     (ix) encumbrances or restrictions existing under or by reason of the Indenture, the
Notes or the Guarantees,

     (x) purchase money obligations that impose restrictions on the property so acquired
of the nature described in clause (c) of this Section 4.09,

     (xi) Liens permitted under the Indenture securing Indebtedness that limit the right
of the debtor to dispose of the assets subject to such Lien,

     (xii) provisions with respect to the disposition or distribution of assets or
property in joint venture agreements, assets sale agreements, stock sale agreements and
other similar agreements,

     (xiii) customary provisions of any franchise, distribution or similar agreements,

     (xiv) restrictions on cash or other deposits or net worth imposed by contracts
entered into in the ordinary course of business, and

     (xv) any encumbrance or restrictions of the type referred to in clauses (a), (b) or
(c) of this Section 4.09 imposed by any amendments, modifications, restatements, renewals,
supplements, refinancings, replacements or refinancings of the contracts, instruments or
obligations referred to in clauses (i) through (xiv) of this Section 4.09; provided, that
such amendments, modifications, restatements, renewals, supplements, refundings,
replacements or refinancings are, in the good faith judgment of the Company’s Board of
Directors, no more restrictive with respect to such dividend and other payment
restrictions than those contained in the dividend or other payment restrictions prior to
such amendment, modification, restatement, renewal, supplement, refunding, replacement or
refinancing.

     Section 4.10. Limitations on Dispositions of Assets. (a) The Company and the Issuer will
not, and will not cause or permit any Restricted Subsidiary to, make any Asset Disposition unless:
(x) the Company (or such Restricted

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Subsidiary, as the case may be) receives consideration at the
time of such Asset Disposition at least equal to the Fair Market Value thereof, and (y) not less
than 70% of the consideration received by the Company (or such Restricted Subsidiary, as the case
may be) is in the form of cash, Cash Equivalents and Marketable Securities (which must be pledged
as Collateral if the assets disposed of constituted Collateral).

     (b) The amount of (i) any Indebtedness (other than any Subordinated Indebtedness) of the
Company or any Restricted Subsidiary that is actually assumed by the transferee in such Asset
Disposition and (ii) the fair market value (as determined in good faith by the Board of Directors
of the Company) of any property or assets (including Capital Stock of any Person that will be a
Restricted Subsidiary following receipt thereof) received that are used or useful in a Real Estate
Business (provided that (except as permitted by clause (c) under the definition of “Permitted
Investment”) to the extent that the assets disposed of in such Asset Disposition were Collateral,
such property or assets are pledged as Collateral under the Security Documents substantially
simultaneously with such sale, with the Lien on such Collateral securing the Notes being of the
same priority with respect to the Notes as the Lien on the assets disposed of), shall be deemed to
be consideration required by clause (y) of Section 4.10(a) for purposes of determining the percentage of such consideration received by the Company or the Restricted
Subsidiaries.

     (c) The Net Cash Proceeds of an Asset Disposition shall, within one year, at the Company’s
election, (1) be used by the Company or a Restricted Subsidiary to invest in assets (including
Capital Stock of any Person that is or will be a Restricted Subsidiary following investment
therein) used or useful in the business of the construction and sale of homes conducted by the
Company and the Restricted Subsidiaries (provided that (except as permitted by clause (c) under the
definition of “Permitted Investment” to the extent that the assets disposed of in such Asset
Disposition were Collateral, such assets are pledged as Collateral under the Security Documents
with the Lien on such Collateral securing the Notes being of the same priority with respect to the
Notes as the Lien on the assets disposed of), (2) be used to permanently prepay or permanently
repay any (i) Indebtedness (or cash collateralize letters of credit) constituting First-Priority
Lien Obligations or Second-Priority Lien Obligations, (ii) Indebtedness which had been secured by
the assets sold in the relevant Asset Disposition, to the extent the assets sold were not
Collateral or (iii) Indebtedness of a Restricted Subsidiary that is not a Guarantor, to the extent
the assets sold were not Collateral, or (3) be applied to make an Offer to Purchase Notes and, if
the Company or a Restricted Subsidiary elects or is required to do so, repay, purchase or redeem
any other Third-Priority Lien Obligations and, if the assets disposed of were not Collateral, any
other unsubordinated Indebtedness (on a pro rata basis if the amount available for such repayment,
purchase or redemption is less than the aggregate amount of (x) the principal amount of the Notes
tendered in such Offer to

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Purchase, (y) the lesser of the principal amount, or accreted value, of
such other Third-Priority Lien Obligations and (z) the lesser of the principal amount, or accreted
value, of such other unsubordinated Indebtedness, plus, in each case accrued interest to the date
of repayment, purchase or redemption) at 100% of the principal amount or accreted value thereof, as
the case may be, plus accrued and unpaid interest, if any, to the date of repurchase or repayment.
Pending any such application under this Section 4.10(c), Net Cash Proceeds may be used to
temporarily reduce Indebtedness or otherwise be invested in any manner not prohibited by the
Indenture.

     (d) Notwithstanding the foregoing, (A) the Company will not be required to apply such Net Cash
Proceeds in accordance with clauses (2) or (3) of Section 4.10(c) except to the extent that such
Net Cash Proceeds, together with the aggregate Net Cash Proceeds of prior Asset Dispositions (other
than those so used) which have not been applied in accordance with this provision and as to which
no prior prepayments or repayments shall have been made and no Offer to Purchase shall have been
made, exceed $25 million and (B) in connection with an Asset Disposition, the Company and the
Restricted Subsidiaries will not be required to comply with the requirements of clause (y) of
Section 4.10(a) to the extent that the non-cash consideration received in connection with such
Asset Disposition, together with the sum of all non-cash consideration received in connection with
all prior Asset Dispositions that has not yet been converted into cash, Cash Equivalents or Marketable Securities, does not exceed $25 million; provided,
however, that when any non-cash consideration is converted into cash, Cash Equivalents or
Marketable Securities, such cash shall constitute Net Cash Proceeds and be subject to the preceding
sentence.

     Section 4.11. Guarantees by Restricted Subsidiaries. Each existing Restricted Subsidiary
(other than the Issuer (for so long as it remains the Issuer) and K. Hovnanian Poland, sp.zo.o.)
will be a Guarantor. The Company is permitted to cause any Unrestricted Subsidiary to be a
Guarantor. If the Issuer, the Company or any of its Restricted Subsidiaries acquires or creates a
Restricted Subsidiary after the Issue Date, such Restricted Subsidiary shall execute a guarantee
substantially in the form included in Exhibit A, execute a supplemental indenture in the form of
Exhibit B, and deliver an Opinion of Counsel to the Trustee to the effect that the supplemental
indenture has been duly authorized, executed and delivered by the new Restricted Subsidiary and
constitutes a valid and binding obligation of the new Restricted Subsidiary, enforceable against
the new Restricted Subsidiary in accordance with its terms (subject to customary exceptions).

     Section 4.12. Repurchase of Notes upon a Change of Control. (a) In the event that there
shall occur a Change of Control, each Holder of Notes shall have the right, at such Holder’s
option, to require the Issuer to purchase all or any part of such Holder’s Notes on a date (the
“Repurchase Date”) that is no later than 90

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days after notice of the Change of Control, at 101% of
the principal amount thereof plus accrued and unpaid interest and Additional Interest, if any, to
the Repurchase Date.

     (b) On or before the thirtieth day after any Change of Control, the Issuer is obligated to
mail, or cause to be mailed, to all Holders of record of Notes and the Trustee a notice regarding
the Change of Control and the repurchase right. The notice shall state the Repurchase Date, the
date by which the repurchase right must be exercised, the price for the Notes and the procedure
which the Holder must follow to exercise such right. Substantially simultaneously with mailing of
the notice, the Issuer shall cause a copy of such notice to be published in a newspaper of general
circulation in the Borough of Manhattan, The City of New York. To exercise such right, the Holder
of such Note must deliver, at least ten days prior to the Repurchase Date, written notice to the
Issuer (or an agent designated by the Issuer for such purpose) of the Holder’s exercise of such
right, together with the Note with respect to which the right is being exercised, duly endorsed for
transfer; provided, however, that if mandated by applicable law, a Holder may be permitted to
deliver such written notice nearer to the Repurchase Date than may be specified by the Issuer.

     (c) The Issuer will comply with applicable law, including Section 14(e) of the Exchange Act
and Rule 14e-1 thereunder, if applicable, if the Issuer is required to give a notice of a right of
repurchase as a result of a Change of Control.

     Section 4.13. Limitations on Transactions with Affiliates. (a) The Company and the Issuer
will not, and will not cause or permit any Restricted Subsidiary to, make any loan, advance,
guarantee or capital contribution to, or for the benefit of, or sell, lease, transfer or otherwise
dispose of any property or assets to or for the benefit of, or purchase or lease any property or
assets from, or enter into or amend any contract, agreement or understanding with, or for the
benefit of, any Affiliate of the Company or any Affiliate of any of the Company’s Subsidiaries or
any holder of 10% or more of the Common Equity of the Company (including any Affiliates of such
holders), in a single transaction or series of related transactions (each, an “Affiliate
Transaction”), except for any Affiliate Transaction the terms of which are at least as favorable as
the terms which could be obtained by the Company, the Issuer or such Restricted Subsidiary, as the
case may be, in a comparable transaction made on an arm’s-length basis with Persons who are not
such a holder, an Affiliate of such a holder or an Affiliate of the Company or any of the Company’s
Subsidiaries.

     (b) In addition, the Company and the Issuer will not, and will not cause or permit any
Restricted Subsidiary to, enter into an Affiliate Transaction unless:

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     (i) with respect to any such Affiliate Transaction involving or having a value of
more than $1 million, the Company shall have (x) obtained the approval of a majority of
the Board of Directors of the Company and (y) either obtained the approval of a majority
of the Company’s disinterested directors or obtained an opinion of a qualified independent
financial advisor to the effect that such Affiliate Transaction is fair to the Company,
the Issuer or such Restricted Subsidiary, as the case may be, from a financial point of
view, and

     (ii) with respect to any such Affiliate Transaction involving or having a value of
more than $10 million, the Company shall have (x) obtained the approval of a majority of
the Board of Directors of the Company and (y) delivered to the Trustee an opinion of a
qualified independent financial advisor to the effect that such Affiliate Transaction is
fair to the Company, the Issuer or such Restricted Subsidiary, as the case may be, from a
financial point of view.

     (c) Notwithstanding the foregoing, an Affiliate Transaction will not include:

     (i) any contract, agreement or understanding with, or for the benefit of, or plan for
the benefit of, employees of the Company or its Subsidiaries generally (in their
capacities as such) that has been approved by the Board of Directors of the Company,

     (ii) Capital Stock issuances to directors, officers and employees of the Company or
its Subsidiaries pursuant to plans approved by the stockholders of the Company,

     (iii) any Restricted Payment otherwise permitted under Section 4.07 hereof,

     (iv) any transaction between or among the Company and one or more Restricted
Subsidiaries or between or among Restricted Subsidiaries (provided, however, no such
transaction shall involve any other Affiliate of the Company (other than an Unrestricted
Subsidiary to the extent the applicable amount constitutes a Restricted Payment permitted
by this Indenture)),

     (v) any transaction between one or more Restricted Subsidiaries and one or more
Unrestricted Subsidiaries where all of the payments to, or other benefits conferred upon,
such Unrestricted Subsidiaries are substantially contemporaneously dividended, or
otherwise distributed or transferred without charge, to the Company or a Restricted
Subsidiary,

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     (vi) issuances, sales or other transfers or dispositions of mortgages and
collateralized mortgage obligations in the ordinary course of business between Restricted
Subsidiaries and Unrestricted Subsidiaries of the Company, and

     (vii) the payment of reasonable and customary fees to, and indemnity provided on
behalf of, officers, directors, employees or consultants of the Company, the Issuer or any
Restricted Subsidiary.

     Section 4.14. Limitations on Mergers, Consolidations and Sales of Assets. Neither the Issuer
nor any Guarantor will consolidate or merge with or into, or sell, lease, convey or otherwise
dispose of all or substantially all of its assets (including, without limitation, by way of
liquidation or dissolution), or assign any of its obligations under the Notes, the Guarantees or
the Indenture (as an entirety or substantially as an entirety in one transaction or in a series of
related transactions), to any Person (in each case other than in a transaction in which the
Company, the Issuer or a Restricted Subsidiary is the survivor of a consolidation or merger, or the
transferee in a sale, lease, conveyance or other disposition) unless:

     (i) the Person formed by or surviving such consolidation or merger (if other than the
Company, the Issuer or the Guarantor, as the case may be), or to which such sale, lease,
conveyance or other disposition or assignment will be made (collectively, the
“Successor”), is a corporation or other legal entity organized and existing under the laws
of the United States or any state thereof or the District of Columbia, and the Successor
assumes by supplemental indenture in a form reasonably satisfactory to the Trustee all of
the obligations of the Company, the Issuer or the Guarantor, as the case may be, under the
Notes or a Guarantee, as the case may be, and the Indenture and the Security Documents,

     (ii) immediately after giving effect to such transaction, no Default or Event of
Default has occurred and is continuing, and

     (iii) immediately after giving effect to such transaction, the Company (or its
Successor) could incur at least $1.00 of Indebtedness pursuant to Section 4.06(a) hereof.

     The foregoing provisions shall not apply to: (i) a transaction involving the sale or
disposition of Capital Stock of a Guarantor, or the consolidation or merger of a Guarantor, or the
sale, lease, conveyance or other disposition of all or substantially all of the assets of a
Guarantor, that in any such case results in such Guarantor being released from its Guarantee
pursuant to Section 6.03, or (ii) a transaction the purpose of which is to change the state of
incorporation of the Company, the Issuer or any Guarantor.

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     Section 4.15. Reports to Holders of Notes. (a) The Company shall file with the Commission
the annual reports and the information, documents and other reports required to be filed pursuant
to Section 13 or 15(d) of the Exchange Act. The Company shall file with the Trustee and mail to
each Holder of record of Notes such reports, information and documents within 15 days after it
files them with the Commission. In the event that the Company is no longer subject to these
periodic reporting requirements of the Exchange Act, it will nonetheless continue to file reports
with the Commission and the Trustee and mail such reports to each Holder of Notes as if it were
subject to such reporting requirements. Regardless of whether the Company is required to furnish
such reports to its stockholders pursuant to the Exchange Act, the Company will cause its
consolidated financial statements and a “Management’s Discussion and Analysis of Results of
Operations and Financial Condition” written report, similar to those that would have been required
to appear in annual or quarterly reports, to be delivered to Holders of Notes.

     (b) For so long as any of the Notes remain outstanding and constitute “restricted securities”
under Rule 144, the Company will furnish to the Holders of Notes and prospective investors, upon
their request, the information required to be delivered pursuant to Rule 144A(d)(4) under the
Securities Act.

     (c) All “obligors,” as that term is defined under the Trust Indenture Act, on the Notes,
including the Issuer and the Guarantors, will comply with Section 314(a) of the Trust Indenture
Act.

     (d) Delivery of these reports, information and documents to the Trustee is for informational
purposes only and the Trustee’s receipt of them will not constitute constructive notice of any
information contained therein or determinable from information contained therein, including the
Issuer’s and/or the Company’s compliance with any of its covenants in this Indenture (as to which
the Trustee is entitled to rely exclusively on Officers’ Certificates).

     Section 4.16. Reports to Trustee. (a) The Company will deliver to the Trustee within 120
days after the end of each fiscal year a written statement by the Company’s independent public
accountants stating (i) that their audit examination has included a review of the terms of this
Indenture and the Notes as they relate to accounting matters, and (ii) whether, in connection with
their audit examination, any Default has come to their attention and, if a Default has come to
their attention, specifying the nature and period of the existence thereof.

     (b) The Company shall deliver to the Trustee, on or prior to each Interest Payment Date, an
Officers’ Certificate setting forth the amount of Additional Interest, if any, the Issuer is
required to pay on that Interest Payment Date. If no Additional Interest is required to be paid on
a given Interest Payment

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Date, no such Officers’ Certificate is required to be delivered to the
Trustee for that Interest Payment Date.

     (c) All “obligors,” as that term is defined under the Trust Indenture Act, on the Notes,
including the Issuer and the Guarantors, will comply with Section 314(a) of the Trust Indenture
Act. The Company will notify the Trustee when any Notes are listed on any national securities
exchange and of any delisting.

     Section 4.17. Notice of Other Defaults. In the event that any Indebtedness of the Issuer or
any Guarantor is declared due and payable before its maturity because of the occurrence of any
default under such Indebtedness, the Issuer or the relevant Guarantor, as the case may be, shall
promptly deliver to the Trustee an Officers’ Certificate stating such declaration; provided, that
the term “Indebtedness” as used in this Section 4.17 shall not include Non-Recourse Indebtedness.

     Section 4.18. Further Assurances; Costs.

     (a) If the Issuer or any of the Guarantors at any time grants, assumes, perfects or becomes
subject to any Lien upon any of its property (other than Excluded Property of the type referred to
in clauses (a) and (b) of the definition thereof) then owned or thereafter acquired as security for
any First-Priority Lien Obligation or Second-Priority Lien Obligation, the Issuer will, or will
cause such Guarantor to, as promptly as practical (subject to the requirements of the Intercreditor
Agreement):

     (i) grant a Lien on such property to the Collateral Agent for the benefit of the
holders of Third-Priority Lien Obligations and, to the extent such grant would require the
execution and delivery of a Security Document, the Issuer or such Guarantor shall execute
and deliver a Security Document on substantially the same terms as the agreement or
instrument executed and delivered to secure the First-Priority Lien Obligations or
Second-Priority Lien Obligations, with changes to reflect the subordination of the Liens
securing the Third-Priority Lien Obligations, including the changes made to the Security
Documents executed and delivered on the Issue Date (as compared to the comparable security
documents securing First-Priority Lien Obligations and Second-Priority Lien Obligations
entered into or in existence on the Issue Date); and

     (ii) cause the Lien granted in such Security Document to be duly perfected in any
manner permitted by law to the same extent as the Liens granted for the benefit of the
First-Priority Lien Obligations and Second-Priority Lien Obligations are perfected (but
junior to such Liens pursuant to the Intercreditor Agreement).

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If the Issuer or such Guarantor delivers an Opinion of Counsel to the holders of First-Priority
Lien Obligations or Second-Priority Lien Obligations in respect of the validity, perfection or
priority of any Lien grant referred to in this clause (a),
the Issuer or such Guarantor shall also deliver an Opinion of Counsel (of no greater scope) with
respect to such matters to the Trustee and Collateral Agent.

     (b) In addition, if the Issuer or any Guarantor at any time after the Issue Date acquires any
new property (other than Excluded Property) that is not automatically subject to a Lien under the
Security Documents, or a Restricted Subsidiary becomes a Guarantor, the Issuer will, or will cause
such Guarantor, subject to the requirements of the Security Documents, to as soon as practical
after such property’s acquisition or it no longer being Excluded Property:

     (i) grant a Lien on such property (or, in the case of a new Guarantor, all of its
assets except Excluded Property) to the Collateral Agent for the benefit of the holders of
Third-Priority Lien Obligations (and, to the extent such grant would require the execution
and delivery of a Security Document, the Issuer or such Guarantor shall execute and
deliver a Security Document on substantially the same terms as the Security Documents
executed and delivered on the Issue Date); and

     (ii) cause the Lien granted in such Security Document to be duly perfected in any
manner permitted by law to the same extent as the Liens granted on the Issue Date are
perfected.

The Issuer or such Guarantor shall deliver an Opinion of Counsel to the Trustee in respect of the
validity, perfection or priority of any Lien grant referred to in this clause (b), addressing
customary matters (and containing customary exceptions) consistent with the Opinion of Counsel
delivered on the Issue Date in respect of such matters. For the avoidance of doubt, while either
the First-Priority Lien Obligations or the Second-Priority Lien Obligations are outstanding and the
Intercreditor Agreement is in effect: (i) any waiver or other determination by the holders of the
First-Priority Lien Obligations or, if the First-Priority Lien Obligations are no longer
outstanding, the holders of the Second-Priority Lien Obligations (or the Administrative Agent, if
so permitted or, if the First-Priority Lien Obligations are no longer outstanding, the Second Lien
Notes Trustee, if so permitted) with respect to an obligation to grant Liens on any assets subject
to this Section 4.18(b) shall also be applicable to the Third-Priority Lien Obligations, and if
applicable, to the extent provided by the Intercreditor Agreement, (ii) any such Opinion of Counsel
to the Trustee shall only be required to the extent that an Opinion of Counsel is delivered to the
holders of either the First-Priority Lien Obligations or the Second-Priority Lien Obligations (and
shall be of no greater scope).

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     (c) Notwithstanding anything to the contrary set forth in clause (a) of this Section 4.18 or
elsewhere in this Indenture or any Security Document:

     (i) any mortgages (and any related Security Documents), and any control agreements
with respect to deposit, checking and securities accounts, required to be granted or
provided, as the case may be, pursuant
to clause (a) of this Section 4.18 on the Issue Date with respect to real property or
accounts, as applicable, that is securing First-Priority Lien Obligations or
Second-Priority Lien Obligations on the Issue Date shall be granted or provided as soon as
commercially reasonable following the Issue Date, but in no event later than 90 days
following the Issue Date; and

     (ii) in the event that Rule 3-16 of Regulation S-X under the Securities Act requires
or would require (or is replaced with another rule or regulation, or any other law, rule
or regulation is adopted, which would require) the filing with the Commission of separate
financial statements of a Guarantor that are not otherwise required to be filed, then the
capital stock or other securities of such Guarantor need not be pledged pursuant to
clauses (a) or (d) of this Section 4.18 and shall automatically be deemed released and to
not be and to not have been part of the Collateral, but only to the extent necessary to
not be subject to such requirement. In such event, the Security Documents may be amended
or modified, without the consent of any Holder of Notes, to the extent necessary to
evidence the release of Liens securing the Third-Priority Lien Obligations on the shares
of capital stock or other securities that are so deemed to no longer constitute part of
the Collateral.

     (d) If, after the Collateral is released in full as contemplated by Section 5.1 of the
Intercreditor Agreement and, thereafter, the Issuer subsequently incurs Obligations under a new
Credit Facility or other First-Priority Lien Obligations that are secured by Liens on assets of the
Issuer or any Guarantor of the type constituting Collateral, then the Issuer and the Guarantors
shall be required to secure the Notes and the Guarantees at such time by a Third-Priority Lien on
the collateral securing such Obligations under the new Credit Facility or other First-Priority Lien
Obligations to the same extent provided by clause (a) of this Section 4.18 on the terms and
conditions of the security documents relating to the new Credit Facility or such other
First-Priority Lien Obligations, with the Liens on the Collateral granted in favor either of the
administrative agent under such new Credit Facility or a collateral agent designated by the Issuer
to hold the Liens for the benefit of the holders of Third-Priority Lien Obligations and subject to
an intercreditor agreement that provides the administrative agent under such new Credit Facility
substantially the same rights and powers as afforded under the Security Documents entered into on
the Issue Date.

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     (e) The Issuer will bear and pay all legal expenses, collateral audit and valuation costs,
filing fees, insurance premiums and other costs associated with the performance of the obligations
of the Issuer and the Guarantors set forth in this Section 4.18 and will also pay or reimburse the
Trustee and Collateral Agent for all reasonable out-of-pocket expenses, disbursements and advances
incurred or made by the Trustee and Collateral Agent in connection therewith, including the
reasonable compensation and expenses of the Trustee and Collateral Agent’s agents and counsel.

     (f) Neither the Issuer nor any of the Guarantors will be permitted to take any action, or
knowingly or negligently omit to take any action, which action or omission might or would have the
result of materially impairing the security interest with respect to the Collateral for the benefit
of the Trustee and the Holders of the Notes.

ARTICLE 5

Remedies

     Section 5.01. Events of Default. “Event of Default” means any one or more of the following
events:

     (i) the failure by the Company, the Issuer and the Guarantors to pay interest on, or
Additional Interest, if any, with respect to, any Note when the same becomes due and
payable and the continuance of any such failure for a period of 30 days;

     (ii) the failure by the Company, the Issuer and the Guarantors to pay the principal
or premium of any Note when the same becomes due and payable at maturity, upon
acceleration or otherwise;

     (iii) the failure by the Company, the Issuer or any Restricted Subsidiary to comply
with any of its agreements or covenants in, or provisions of, the Notes, the Guarantees or
the Indenture and such failure continues for the period and after the notice specified
below (except in the case of a default under Section 4.12 and 4.14, which will constitute
Events of Default with notice but without passage of time);

     (iv) the acceleration of any Indebtedness (other than Non-Recourse Indebtedness) of
the Company, the Issuer or any Restricted Subsidiary that has an outstanding principal
amount of $10 million or more, individually or in the aggregate, and such acceleration
does not cease to exist, or such Indebtedness is not satisfied, in either case within 30
days after such acceleration;

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     (v) the failure by the Company, the Issuer or any Restricted Subsidiary to make any
principal or interest payment in an amount of $10 million or more, individually or in the
aggregate, in respect of Indebtedness (other than Non-Recourse Indebtedness) of the
Company or any Restricted Subsidiary within 30 days of such principal or interest becoming
due and payable (after giving effect to any applicable grace period set forth in the
documents governing such Indebtedness);

     (vi) a final judgment or judgments that exceed $10 million or more, individually or
in the aggregate, for the payment of money having been entered by a court or courts of
competent jurisdiction against the Company, the Issuer or any of its Restricted
Subsidiaries and such
judgment or judgments is not satisfied, stayed, annulled or rescinded within 60 days
of being entered;

     (vii) the Company, the Issuer or any Restricted Subsidiary that is a Significant
Subsidiary pursuant to or within the meaning of any Bankruptcy Law:

     (A) commences a voluntary case,

     (B) consents to the entry of an order for relief against it in an
involuntary case,

     (C) consents to the appointment of a Custodian of it or for all or
substantially all of its property, or

     (D) makes a general assignment for the benefit of its creditors;

     (viii) a court of competent jurisdiction enters an order or decree under any
Bankruptcy Law that:

     (A) is for relief against the Company, the Issuer or any Restricted
Subsidiary that is a Significant Subsidiary as debtor in an involuntary case,

     (B) appoints a Custodian of the Company, the Issuer or any Restricted
Subsidiary that is a Significant Subsidiary or a Custodian for all or
substantially all of the property of the Company or any Restricted Subsidiary
that is a Significant Subsidiary, or

     (C) orders the liquidation of the Company, the Issuer or any Restricted
Subsidiary that is a Significant Subsidiary,
and the order or decree remains unstayed and in effect for 60 days;

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     (ix) any Guarantee of a Guarantor which is a Significant Subsidiary ceases to be in
full force and effect (other than in accordance with the terms of such Guarantee and this
Indenture) or is declared null and void and unenforceable or found to be invalid or any
Guarantor denies its liability under its Guarantee (other than by reason of release of a
Guarantor from its Guarantee in accordance with the terms of the Indenture and the
Guarantee); or

     (x) the Liens created by the Security Documents shall at any time not constitute a
valid and perfected Lien on any material portion of the Collateral intended to be covered
thereby (to the extent perfection by filing, registration, recordation or possession is
required by this Indenture
or the Security Documents) other than in accordance with the terms of the relevant
Security Document and this Indenture and other than the satisfaction in full of all
Obligations under this Indenture or the release or amendment of any such Lien in
accordance with the terms of this Indenture or the Security Documents, or, except for
expiration in accordance with its terms or amendment, modification, waiver, termination or
release in accordance with the terms of this Indenture and the relevant Security Document,
any of the Security Documents shall for whatever reason be terminated or cease to be in
full force and effect, if in either case, such default continues for 30 days after notice,
or the enforceability thereof shall be contested by the Issuer or any Guarantor.

     A Default as described in subclause (iii) of this Section 5.01 will not be deemed an Event of
Default until the Trustee notifies the Company, or the Holders of at least 25 percent in principal
amount of the then outstanding Notes notify the Company and the Trustee, of the Default and (except
in the case of a default with respect to Section 4.12 and 4.14 hereof) the Company does not cure
the Default within 60 days after receipt of the notice. The notice must specify the Default,
demand that it be remedied and state that the notice is a “Notice of Default.” If such a Default
is cured within such time period, it ceases.

     If an Event of Default (other than an Event of Default with respect to the Company or the
Issuer resulting from subclauses (vii) or (viii) of this Section 5.01), shall have occurred and be
continuing under the Indenture, the Trustee by notice to the Company, or the Holders of at least 25
percent in principal amount of the Notes then outstanding by notice to the Company and the Trustee,
may declare all Notes to be due and payable immediately. Upon such declaration of acceleration,
the amounts due and payable on the Notes will be due and payable immediately. If an Event of
Default with respect to the Company or the Issuer specified in subclauses (vii) or (viii) of this
Section 5.01 occurs, such an amount will ipso facto become and be immediately due and payable
without any

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declaration, notice or other act on the part of the Trustee and the Company or any
Holder. This provision, however, is subject to the condition that, if at any time after the unpaid
principal amount (or such specified amount) of the Notes shall have been so declared due and
payable and before any judgment or decree for the payment of the moneys due shall have been
obtained or entered as hereinafter provided, the Issuer shall pay or shall deposit with the Trustee
a sum sufficient to pay all matured installments of interest and Additional Interest, if any, upon
all of the Notes and the principal of all the Notes which shall have become due otherwise than by
acceleration (with interest on overdue installments of interest and Additional Interest, if any, to
the extent that payment of such interest is enforceable under applicable law and on such principal
at the rate borne by the Notes to the date of such payment or deposit) and the reasonable
compensation, disbursements, expenses and advances of the Trustee and all other amounts due the
Trustee under Section 7.07, and any and all defaults under this Indenture, other than the
nonpayment of such portion of the principal amount of and accrued interest and Additional Interest,
if any, on Notes which shall have become due by
acceleration, shall have been cured or shall have been waived in accordance with Section 5.03
or provision deemed by the Trustee to be adequate shall have been made therefor, then and in every
such case the Holders of a majority in aggregate principal amount of the Notes then outstanding, by
written notice to the Issuer and to the Trustee, may rescind and annul such declaration and its
consequences; but no such rescission and annulment shall extend to or shall affect any subsequent
default, or shall impair any right consequent thereon. Notwithstanding the previous sentence, no
waiver shall be effective against any Holder for any Event of Default or event which with notice or
lapse of time or both would be an Event of Default with respect to any covenant or provision which
cannot be modified or amended without the consent of the Holder of each outstanding Note affected
thereby, unless all such affected Holders agree, in writing, to waive such Event of Default or
other event.

     If the Trustee shall have proceeded to enforce any right under this Indenture and such
proceedings shall have been discontinued or abandoned because of such rescission or annulment or
for any reason or shall have been determined to be adverse to the Trustee, then and in every such
case the Issuer, the Trustee and the Holders of Notes shall be restored respectively to their
several positions and rights hereunder, and all rights, remedies and powers of the Issuer, the
Trustee and the Holders of Notes shall continue as though no such proceeding had been taken.

     Except with respect to an Event of Default pursuant to clauses (i) or (ii) of this Section
5.01, the Trustee shall not be charged with knowledge of any Event of Default unless written notice
thereof shall have been given to the Trustee by the Issuer, a Paying Agent or any Holder.

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     Section 5.02. Other Remedies. If an Event of Default occurs and is continuing, the Trustee
may pursue, in its own name or as trustee of an express trust, any available remedy by proceeding
at law or in equity to collect the payment of principal of, premium, if any, and interest or
Additional Interest, if any, on the Notes or to enforce the performance of any provision of the
Notes or the Indenture. The Trustee may maintain a proceeding even if it does not possess any of
the Notes or does not produce any of them in the proceeding.

     Section 5.03. Waiver of Defaults by Majority of Holders. By written notice to the Trustee
and the Company, the Holders of a majority in aggregate principal amount of the Notes then
outstanding may on behalf of the Holders of all of the Notes waive any past Default or Event of
Default hereunder and its consequences, except a Default in the payment of interest and Additional
Interest, if any, on, or the principal of, the Notes. Upon any such waiver, the Issuer, the
Trustee and the Holders of Notes shall be restored to their former positions and rights hereunder,
respectively; but no such waiver shall extend to any subsequent or other Default or Event of
Default or impair any right consequent thereon. Whenever any Default or Event of Default hereunder
shall have been waived as permitted by this Section 5.03, said Default or Event of Default shall
for all
purposes of the Notes and this Indenture be deemed to have been cured and to be not
continuing.

     Section 5.04. Direction of Proceedings. The Holders of a majority in aggregate principal
amount of the outstanding Notes shall have the right to direct the time, method, and place of
conducting any proceeding for any remedy available to the Trustee, or exercising any trust or power
conferred on the Trustee with respect to the Notes; provided, however, that (subject to the
provisions of Section 7.01) the Trustee shall have the right to decline to follow any such
direction if the Trustee shall determine upon advice of counsel that the action or proceeding so
directed may not lawfully be taken or if the Trustee in good faith by its board of directors, its
executive committee, or a trust committee of directors or Responsible Officers or both shall
determine that the action or proceeding so directed would involve the Trustee in personal
liability.

     Section 5.05. Application of Moneys Collected by Trustee. Any moneys collected by the
Trustee pursuant to this Article (including any proceeds from Collateral received pursuant to the
terms of the Security Documents) with respect to outstanding Notes shall be applied in the order
following, at the date or dates fixed by the Trustee for the distribution of such moneys, upon
presentation of the Notes and stamping thereon the payment, if only partially paid, and upon
surrender thereof, if fully paid:

     FIRST: To the payment of costs and expenses of collection and reasonable compensation
to the Trustee, its agents, attorneys and counsel, and all other expenses and liabilities
incurred, and all advances made, by

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the Trustee pursuant to Section 7.07 except as a
result of its negligence or bad faith;

     SECOND: If the principal of the Notes shall not have become due and be unpaid, to the
payment of interest or Additional Interest, if any, on the Notes, in the order of the
maturity of the installments of such interest or Additional Interest, if any, with
interest (to the extent that such interest has been collected by the Trustee) upon the
overdue installments of interest and Additional Interest, if any, at the rate borne by the
Notes, such payment to be made ratably to the Persons entitled thereto;

     THIRD: If the principal of the Notes shall have become due, by declaration or
otherwise, to the payment of the whole amount then owing and unpaid upon the Notes for
principal, interest and Additional Interest, if any, with interest on the overdue
principal and (to the extent that such interest has been collected by the Trustee) upon
overdue installments of interest and Additional Interest, if any, at the rate borne by the
Notes, and in case such moneys shall be insufficient to pay in full the whole amounts so
due and unpaid upon the Notes, then to the payment of such principal and interest and
Additional Interest, if any, without preference or priority of principal over interest or
Additional Interest, if any, or of interest or
Additional Interest, if any, over principal, or of interest over Additional Interest,
if any, or of any installment of interest, if any, or Additional Interest, if any, over
any other installment of interest or Additional Interest, if any, ratably to the aggregate
of such principal and accrued and unpaid interest and Additional Interest, if any; and

     FOURTH: To the payment of any surplus then remaining to the Issuer, its successors or
assigns, or to whomsoever may be lawfully entitled to receive the same.

     No claim for interest which in any manner at or after maturity shall have been transferred or
pledged separate or apart from the Notes to which it relates, or which in any manner shall have
been kept alive after maturity by an extension (otherwise than pursuant to an extension made
pursuant to a plan proposed by the Issuer to the Holders of all Notes), purchase, funding or
otherwise by or on behalf or with the consent or approval of the Issuer shall be entitled, in case
of a default hereunder, to any benefit of this Indenture, except after prior payment in full of the
principal of all Notes and of all claims for interest not so transferred, pledged, kept alive,
extended, purchased or funded.

     Section 5.06. Proceedings by Holders. No holder of any Notes shall have any right by virtue
of or by availing of any provision of this Indenture to institute any suit, action or proceeding in
equity or at law upon or under or with respect to this Indenture for the appointment of a receiver
or trustee or similar official, or for

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any other remedy hereunder, unless such Holder previously
shall have given to the Trustee written notice of default and of the continuance thereof, as
hereinbefore provided, and unless the Holders of not less than 25% in aggregate principal amount of
the Notes then outstanding shall have made written request to the Trustee to institute such action,
suit or proceeding in its own name as Trustee hereunder and shall have offered to the Trustee such
reasonable indemnity as it may require against the costs, expenses and liabilities to be incurred
therein or thereby, and the Trustee for 60 days after its receipt of such notice, request and offer
of indemnity shall have neglected or refused to institute any such action, suit or proceeding, it
being understood and intended, and being expressly covenanted by the Holder of every Note with
every other Holder and the Trustee, that no one or more Holders of Notes shall have any right in
any manner whatever by virtue of or by availing of any provision of this Indenture or of the Notes
to affect, disturb or prejudice the rights of any other Holder of Notes, or to obtain or seek to
obtain priority over or preference as to any other such Holder, or to enforce any right under this
Indenture or the Notes, except in the manner herein provided and for the equal, ratable and common
benefit of all Holders of Notes.

     Notwithstanding any other provisions in this Indenture, however, the right of any Holder of
any Note to receive payment of the principal of, premium, if any, and interest and Additional
Interest, if any, on such Note, on or after the maturity thereof, or to institute suit for the
enforcement of any such payment on or after
such respective dates shall not be impaired or affected without the consent of such Holder.

     Section 5.07. Proceedings by Trustee. In case of an Event of Default hereunder, the Trustee
may in its discretion proceed to protect and enforce the rights vested in it by this Indenture by
such appropriate judicial proceedings as the Trustee shall deem most effectual to protect and
enforce any of such rights, either by suit in equity or by action at law or by proceedings in
bankruptcy or otherwise, whether for the specific enforcement of any covenant or agreement
contained in this Indenture or in aid of the exercise of any power granted in this Indenture, or to
enforce any other legal or equitable right vested in the Trustee by this Indenture or by law.

     Section 5.08. Remedies Cumulative and Continuing. All powers and remedies given by this
Article 5 to the Trustee or to the Holders shall, to the extent permitted by law, be deemed
cumulative and not exclusive of any thereof or of any other powers and remedies available to the
Trustee or the Holders, by judicial proceedings or otherwise, to enforce the performance or
observance of the covenants and agreements contained in this Indenture, and no delay or omission of
the Trustee or of any Holder to exercise any right or power accruing upon any default occurring and
continuing as aforesaid shall impair any such right or power, or shall be construed to be a waiver
of any such default or an acquiescence therein; and, subject to the provisions of Section 5.06,
every power and remedy

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given by this Article 5 or by law to the Trustee or to the Holders may be
exercised from time to time, and as often as shall be deemed expedient, by the Trustee or by the
Holders.

     Section 5.09. Undertaking to Pay Costs. All parties to this Indenture agree, and each Holder
of any Note by his acceptance thereof shall be deemed to have agreed, that any court may in its
discretion require, or in any suit for the enforcement of any right or remedy under this Indenture,
or in any suit against the Trustee for any action taken or omitted by it as Trustee, the filing by
any party litigant in such suit of an undertaking to pay the cost of such suit, and that such court
may in its discretion assess reasonable costs, including reasonable attorneys’ fees and expenses,
against any party litigant in such suit, having due regard to the merits and good faith of the
claims or defenses made by such party litigant; but the provisions of this Section 5.09 shall not
apply to any suit instituted by the Trustee, to any suit instituted by any Holder, or group of
Holders, holding in the aggregate more than 10% in principal amount of the then outstanding Notes,
or to any suit instituted by any Holders for the enforcement of the payment of the principal of,
premium, if any, or interest or Additional Interest, if any, on any Note against the Issuer on or
after the due date of such Note.

     Section 5.10. Notice of Defaults. (a) The Company is required to deliver to the Trustee an
annual statement regarding compliance with the Indenture, and include in such statement, if any
officer of the Company is aware of any Default or Event of Default, a statement specifying such
Default or Event of Default and
what action the Company is taking or proposes to take with respect thereto. In addition, the
Company is required to deliver to the Trustee prompt written notice of the occurrence of any
Default or Event of Default.

     (b) The Trustee shall, within 90 days after the occurrence of a default known to the Trustee,
with respect to the Notes, mail to all Holders of Notes, as the names and the addresses of such
Holders appear upon the Register, notice of all defaults, unless such defaults shall have been
cured before the giving of such notice (the term “default” for the purpose of this Section 5.10(b)
being hereby defined to be the events specified in clauses (i), (ii), (iii), (iv), (v), (vi),
(vii), (viii), (ix) and (x) of Section 5.01, not including periods of grace, if any, provided for
therein and irrespective of the giving of the written notice specified in said clause (iii) but in
the case of any default of the character specified in said clause (iii) no such notice to Holders
shall be given until at least 60 days after the giving of written notice thereof to the Company
pursuant to said clause (iii)); provided, however, that, except in the case of default in the
payment of the principal of, premium, if any, or interest and Additional Interest, if any, on any
of the Notes, or in the payment or satisfaction of a purchase obligation, the Trustee shall be
protected in withholding such notice if and so long as the board of directors, the executive
committee, a trust committee of directors or a Responsible Officer of the Trustee in good faith
determines that the withholding of such notice is in the

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best interests of the Holders. Notice to
Holders under this Section shall be given in the manner and to the extent provided in Trust
Indenture Act Section 313(c).

     Section 5.11. Waiver of Stay, Extension or Usury Laws. The Company, the Issuer and each
Guarantor covenants, to the extent permitted by applicable law, that it will not at any time insist
upon, or plead, or in any manner whatsoever claim or take the benefit or advantage of, any stay or
extension law or any usury law or other law that would prohibit or forgive the Company, the Issuer
or the Guarantor from paying all or any portion of the principal of, premium, if any, or interest
or Additional Interest, if any, on the Notes as contemplated herein, wherever enacted, now or at
any time hereafter in force, or that may affect the covenants or the performance of the Indenture.
The Company, the Issuer and each Guarantor hereby expressly waives, to the extent that it may
lawfully do so, all benefit or advantage of any such law and covenants that it will not hinder,
delay or impede the execution of any power herein granted to the Trustee, but will suffer and
permit the execution of every such power as though no such law had been enacted.

     Section 5.12. Trustee May File Proof of Claim. The Trustee may file proofs of claim and
other papers or documents as may be necessary or advisable in order to have the claims of the
Trustee (including any claim for the compensation, expenses, disbursements and advances of the
Trustee, its agents and counsel, and any other amounts due the Trustee hereunder) and the Holders
allowed in any judicial proceedings relating to the Company, the Issuer or any Guarantor or their
respective creditors or property, and is entitled and empowered to collect, receive and distribute
any money, securities or other property payable
or deliverable upon conversion or exchange of the Notes or upon any such claims. Any
custodian, receiver, assignee, trustee, liquidator, sequestrator or other similar official in any
such judicial proceeding is hereby authorized by each Holder to make such payments to the Trustee
and, if the Trustee consents to the making of such payments directly to the Holders, to pay to the
Trustee any amount due to it for the reasonable compensation, expenses, disbursements and advances
of the Trustee, its agent and counsel, and any other amounts due the Trustee hereunder. Nothing in
the Indenture will be deemed to empower the Trustee to authorize or consent to, or accept or adopt
on behalf of any Holder, any plan of reorganization, arrangement, adjustment or composition
affecting the Notes or the rights of any Holder thereof, or to authorize the Trustee to vote in
respect of the claim of any Holder in any such proceeding.

     Section 5.13. Payment of Notes on Default; Suit Therefor. The Issuer covenants that (a) if
default shall be made in the payment of any installment of interest and Additional Interest, if
any, upon the Notes as and when the same shall become due and payable, and such default shall have
continued for a period of 30 days, or (b) if default shall be made in the payment of the principal
of, and premium, if any, on the Notes as and when the same shall have become due and

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payable,
whether at maturity of the Notes or upon redemption or by declaration or otherwise, then, upon
demand of the Trustee, the Issuer will pay to the Trustee, for the benefit of the Holders, the
whole amount that then shall have become due and payable on all such Notes for principal, and
premium, if any, or interest and Additional Interest, if any, or both, as the case may be, with
interest upon the overdue principal and (to the extent that payment of such interest is enforceable
under applicable law) upon the overdue installments of interest and Additional Interest, if any, at
the rate borne by the Notes; and, in addition thereto, such further amount as shall be sufficient
to cover the costs and expenses of collection, including a reasonable compensation to the Trustee,
its agent, attorneys and counsel, and any expenses or liabilities incurred by the Trustee hereunder
other than through its negligence or bad faith.

     If the Issuer shall fail forthwith to pay such amounts upon such demand, the Trustee, in its
own name and as trustee of an express trust, shall be entitled and empowered to institute any
actions or proceedings at law or in equity for the collection of the sums so due and unpaid, and
may prosecute any such action or proceeding to judgment or final decree, and may enforce any such
judgment or final decree against the Issuer or any other obligor on the Notes and collect in the
manner provided by law out of the property of the Issuer or any other obligor on the Notes,
wherever situated, the moneys adjudged or decreed to be payable.

     If there shall be pending proceedings for the bankruptcy or for the reorganization of the
Issuer or any other obligor on the Notes under any bankruptcy, insolvency or other similar law now
or hereafter in effect, or if a receiver or trustee or similar official shall have been appointed
for the property of the Issuer or such other obligor, or in the case of any other similar judicial
proceedings relative to the Issuer or other obligor on the Notes, or to the creditors
or property of the Issuer or such other obligor, the Trustee, irrespective of whether the
principal of the Notes shall then be due and payable as therein expressed or by declaration or
otherwise and irrespective of whether the Trustee shall have made any demand pursuant to the
provisions of this Section 5.13, shall be entitled and empowered by intervention in such
proceedings or otherwise to file and prove a claim or claims for the whole amount of principal,
premium, if any, interest and Additional Interest, if any, owing and unpaid in respect of the
Notes, and, in case of any judicial proceedings, to file such proofs of claim and other papers or
documents as may be necessary or advisable in order to have the claims of the Trustee and of the
Holders allowed in such judicial proceedings relative to the Issuer or any other obligor on the
Notes, its or their creditors, or its or their property, and to collect and receive any moneys or
other property payable or deliverable on any such claims, and to distribute the same after the
deduction of its charges and expenses, and any receiver, assignee or trustee or similar official in
bankruptcy or reorganization is hereby authorized by each of the Holders to make such payments to
the Trustee, and, if the Trustee shall consent to the making of such payments directly to the
Holders, to pay to the Trustee any

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amount due it for compensation and expenses or otherwise
pursuant to Section 7.07, including counsel fees and expenses incurred by it up to the date of such
distribution. To the extent that such payment of reasonable compensation, expenses and counsel
fees and expenses out of the estate in any such proceedings shall be denied for any reason, payment
of the same shall be secured by a lien on, and shall be paid out of, any and all distributions,
dividends, moneys, securities and other property which the Holders of Notes may be entitled to
receive in such proceedings, whether in liquidation or under any plan of reorganization or
arrangement or otherwise.

     All rights of action and of asserting claims under this Indenture, or under any of the Notes,
may be enforced by the Trustee without the possession of any of the Notes, or the production
thereof at any trial or other proceeding relative thereto, and any such suit or proceeding
instituted by the Trustee shall be brought in its own name as trustee of an express trust, and any
recovery of judgment shall be for the ratable benefit of the Holders of Notes in respect of which
such judgment has been recovered.

ARTICLE 6

Guarantees; Release of Guarantor

     Section 6.01. Guarantee. Each of the Guarantors hereby unconditionally guarantees, jointly
and severally with each other Guarantor, to each Holder and to the Trustee and its successors and
assigns, irrespective of the validity and enforceability of this Indenture, the Notes or the
obligations of the Issuer hereunder or thereunder, that: (i) the due and punctual payment of the
principal of, premium, if any, and interest or Additional Interest, if any, on the Notes, whether
at maturity or on an interest payment date, by acceleration, pursuant to an Offer to Purchase or
otherwise, to the extent lawful, and all other obligations of
the Issuer to the Holders or the Trustee hereunder or thereunder shall be promptly paid in
full when due, all in accordance with the terms hereof and thereof, including all amounts payable
to the Trustee under Section 7.07 hereof, and (ii) in case of any extension of time of payment or
renewal of any Notes or any of such other obligations, the same shall be promptly paid in full when
due or performed in accordance with the terms of the extension or renewal, whether at stated
maturity, by acceleration or otherwise.

     If the Issuer fails to make any payment when due of any amount so guaranteed for whatever
reason, each Guarantor shall be obligated, jointly and severally with each other Guarantor, to pay
the same immediately. Each Guarantor hereby agrees that its obligations hereunder shall be
continuing, absolute and unconditional, irrespective of, and shall be unaffected by, the validity,
regularity or enforceability of the Notes, this Indenture, the absence of any action to enforce the
same, any waiver or consent by any Holder or the Trustee with respect to any provisions hereof or
thereof, the recovery of any

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judgment against the Issuer, any action to enforce the same or any
other circumstance which might otherwise constitute a legal or equitable discharge or defense of
such Guarantor. If any Holder or the Trustee is required by any court or otherwise to return to
the Issuer or any Guarantor, or any custodian, trustee, liquidator or other similar official acting
in relation to the Issuer or such Guarantor, any amount paid by the Issuer or any Guarantor to the
Trustee or such Holder, this Article 6, to the extent theretofore discharged with respect to any
Guarantee, shall be reinstated in full force and effect. Each Guarantor agrees that it shall not
be entitled to any right of subrogation in relation to the Holders in respect of any obligations
guaranteed hereby by such Guarantor until payment in full of all such obligations. Each Guarantor
further agrees that, as between such Guarantor, on the one hand, and the Holders of Notes and the
Trustee on the other hand, (i) the maturity of the obligations guaranteed hereby may be accelerated
as provided in Article 5 hereof for the purposes of such Guarantee, notwithstanding any stay,
injunction or other prohibition preventing such acceleration in respect of the obligations
guaranteed hereby and (ii) in the event of any acceleration of such obligations as provided in
Article 5 hereof such obligations (whether or not due and payable) shall forthwith become due and
payable by such Guarantor, jointly and severally with each other Guarantor, for the purpose of this
Article 6. In addition, without limiting the foregoing, upon the effectiveness of an acceleration
under Article 5, the Trustee may make a demand for payment on the Notes under any Guarantee
provided hereunder and not discharged.

     The Guarantee set forth in this Section 6.01 shall not be valid or become obligatory for any
purpose with respect to a Note until the certificate of authentication on such Note shall have been
signed by the Trustee or any duly appointed agent.

     Section 6.02. Obligations of each Guarantor Unconditional. Nothing contained in this Article
6 or elsewhere in this Indenture or in any Note is intended to or shall impair, as between each
Guarantor and the Holders, the
obligations of such Guarantor which are absolute and unconditional, to pay to the Holders the
principal of, premium, if any, and interest and Additional Interest, if any, on the Notes as and
when the same shall become due and payable in accordance with the provisions of their Guarantee or
is intended to or shall affect the relative rights of the Holders and creditors of such Guarantor,
nor shall anything herein or therein prevent the Trustee or any Holder from exercising all remedies
otherwise permitted by applicable law upon any Default under this Indenture in respect of cash,
property or securities of such Guarantor received upon the exercise of any such remedy.

     Upon any distribution of assets of a Guarantor referred to in this Article 6 the Trustee,
subject to the provisions of Article 7, the Holders shall be entitled to rely upon any order or
decree made by any court of competent jurisdiction in which such dissolution, winding up,
liquidation or reorganization proceedings are

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pending, or a certificate of the liquidating trustee
or agent or other person making any distribution to the Trustee or to such Holders for the purpose
of ascertaining the persons entitled to participate in such distribution, the holders of other
indebtedness of such Guarantor, the amount thereof or payable thereon, the amount or amounts paid
or distributed thereon and all other facts pertinent thereto or to this Article 6.

     Section 6.03. Release of a Guarantor. (a) If all or substantially all of the assets of any
Guarantor other than the Company or all of the Capital Stock of any Guarantor other than the
Company is sold (including by consolidation, merger, issuance or otherwise) or disposed of
(including by liquidation, dissolution or otherwise) by the Company or any of its Subsidiaries, or,
unless the Company elects otherwise, if any Guarantor other than the Company is designated an
Unrestricted Subsidiary in accordance with the terms of the Indenture, then such Guarantor (in the
event of a sale or other disposition of all of the Capital Stock of such Guarantor or a designation
as an Unrestricted Subsidiary) or the Person acquiring such assets (in the event of a sale or other
disposition of all or substantially all of the assets of such Guarantor) shall be deemed
automatically and unconditionally released and discharged from any of its obligations under the
Indenture without any further action on the part of the Trustee or any Holder of Notes.

     (b) An Unrestricted Subsidiary that is a Guarantor shall be deemed automatically and
unconditionally released and discharged from all obligations under its Guarantee upon notice from
the Company to the Trustee to such effect, without any further action required on the part of the
Trustee or any Holder.

     Section 6.04. Execution and Delivery of Guarantee. The execution by each Guarantor of the
Indenture (or a supplemental indenture in the form of Exhibit B) together with an executed
guarantee substantially in the form included in Exhibit A evidences the Guarantee of such
Guarantor, whether or not the person signing as an officer of the Guarantor still holds that office
at the time of authentication of any Note. The delivery of any Note by the Trustee after
authentication constitutes due delivery of the Guarantee on behalf of each Guarantor.

     Section 6.05. Limitation on Guarantor Liability. Notwithstanding anything to the contrary in
this Article 6, each Guarantor, and by its acceptance of a Note, each Holder, hereby confirms that
it is the intention of all such parties that the Guarantee of such Guarantor not constitute a
fraudulent conveyance under applicable fraudulent conveyance provisions of the United States
Bankruptcy Code or any comparable provision of state law. To effectuate that intention, the
Trustee, the Holders and the Guarantors hereby irrevocably agree that the obligations of each
Guarantor under its Guarantee are limited to the maximum amount that would not render the
Guarantor’s obligations subject to avoidance

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under applicable fraudulent conveyance provisions of
the United States Bankruptcy Code or any comparable provision of state law.

     Section 6.06. Article 6 not to Prevent Events of Default. The failure to make a payment on
account of principal, premium, if any, or interest or Additional Interest, if any, on the Notes by
reason of any provision in this Article 6 shall not be construed as preventing the occurrence of
any Event of Default under Section 5.01.

     Section 6.07. Waiver by the Guarantors. To the extent permitted by applicable law, each
Guarantor hereby irrevocably waives diligence, presentment, demand of payment, demand of
performance, filing of claims with a court in the event of insolvency of bankruptcy of the Issuer,
any right to require a proceeding first against the Issuer, the benefit of discussion, protest,
notice and all demand whatsoever and covenants that this Guarantee shall not be discharged except
by complete performance of the obligations contained in the Notes, in this Indenture and in this
Article 6.

     Section 6.08. Subrogation and Contribution. Upon making any payment with respect to any
obligation of the Issuer under this Article, the Guarantor making such payment will be subrogated
to the rights of the payee against the Issuer with respect to such obligation; provided, that the
Guarantor may not enforce either any right of subrogation, or any right to receive payment in the
nature of contribution, or otherwise, from any other Guarantor, with respect to such payment so
long as any amount payable by the Issuer hereunder or under the Notes remains unpaid.

     Section 6.09. Stay of Acceleration. If acceleration of the time for payment of any amount
payable by the Issuer under the Indenture or the Notes is stayed upon the insolvency, bankruptcy or
reorganization of the Issuer, all such amounts otherwise subject to acceleration under the terms of
the Indenture are nonetheless payable by the Guarantors hereunder forthwith on demand by the
Trustee or the Holders.

     Section 6.10. Guarantors as “obligors” for Provisions Included in the Indenture Pursuant to
the Trust Indenture Act. Each provision included in the Indenture which is required to be included
by any of Sections 310 to 317 of the Trust Indenture Act, inclusive, or is deemed applicable to the
Indenture by virtue of the provisions of the Trust Indenture Act, and which applies to an
“obligor,” as that term is defined under the Trust Indenture Act, shall apply to each of the
Guarantors; provided that in each case the provisions of TIA §314(b) and §314(d) shall only apply
following qualification of this Indenture under the TIA.

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ARTICLE 7

The Trustee

     Section 7.01. General. (a) The duties and responsibilities of the Trustee are as provided by
the Trust Indenture Act and as set forth herein. Whether or not expressly so provided, every
provision of the Indenture relating to the conduct or affecting the liability of, or affording
protection to, the Trustee is subject to this Article.

     (b) Except during the continuance of an Event of Default, the Trustee need perform only those
duties that are specifically set forth in the Indenture and no others, and no implied covenants or
obligations will be read into this Indenture against the Trustee. In case an Event of Default has
occurred and is continuing, the Trustee shall exercise those rights and powers vested in it by this
Indenture, and use the same degree of care and skill in their exercise as a prudent man would
exercise or use under the circumstances in the conduct of his own affairs.

     Section 7.02. Certain Rights of the Trustee. Subject to Trust Indenture Act Sections 315(a)
through (d):

     (a) The Trustee may rely, and will be protected in acting or refraining from acting,
upon any resolution, certificate, statement, instrument, opinion, report, notice, request,
direction, consent, order, bond, debenture, note, other evidence of indebtedness or other
paper or document believed by it to be genuine and to have been signed or presented by the
proper Person. The Trustee need not investigate any fact or matter stated in the
document, but the Trustee, in its discretion, may make further inquiry or investigation
into such facts or matters as it sees fit.

     (b) Before the Trustee acts or refrains from acting, it may require an Officers’
Certificate or an Opinion of Counsel conforming to Section 13.05 and the Trustee will not
be liable for any action it takes or omits to take in good faith in reliance on such a
certificate or opinion. Unless otherwise specifically provided in this Indenture, any
demand, request, direction or notice from the Issuer or the Company, as applicable, shall
be sufficient if signed by an Officer of the Issuer or the Company, as applicable.

     (c) The Trustee may act through its attorneys and agents and will not be responsible
for the misconduct or negligence of any agent appointed with due care.

     (d) The Trustee will be under no obligation to exercise any of the rights or powers
vested in it by this Indenture at the request or direction of any of the Holders, unless
such Holders have offered to the

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Trustee reasonable security or indemnity against the
costs, expenses and liabilities that might be incurred by it in compliance with such
request or direction.

     (e) The Trustee will not be liable for any action it takes or omits to take in good
faith that it believes to be authorized or within its rights or powers or for any action
it takes or omits to take in accordance with the direction of the Holders in accordance
with Section 5.04 relating to the time, method and place of conducting any proceeding for
any remedy available to the Trustee, or exercising any trust or power conferred upon the
Trustee, under the Indenture.

     (f) The Trustee may consult with counsel, and the written advice of such counsel or
any Opinion of Counsel will be full and complete authorization and protection in respect
of any action taken, suffered or omitted by it hereunder in good faith and in reliance
thereon.

     (g) No provision of the Indenture will require the Trustee to expend or risk its own
funds or otherwise incur any financial liability in the performance of its duties
hereunder, or in the exercise of its rights or powers, unless it receives indemnity
satisfactory to it against any loss, liability or expense.

     (h) The Trustee may request that the Company (on behalf of itself and the Issuer)
deliver an Officers’ Certificate setting forth the name of the individuals and/or titles
of Officers authorized at such time to take specific actions pursuant to this Indenture,
which Officers’ Certificate may be signed by any person authorized to sign an Officers’
Certificate, including any person specified as so authorized in any such Officers’
Certificate previously delivered and not superseded.

     (i) In no event shall the Trustee be liable, directly or indirectly, for any special,
indirect or consequential damages, even if the Trustee has been advised of the possibility
of such damages.

     (j) The rights, privileges, protections, immunities and benefits given to the
Trustee, including, without limitation, its right to be indemnified, are extended to, and
shall be enforceable by, the Trustee in each of its capacities hereunder, and to each
agent, custodian and other Person employed to act hereunder.

     Section 7.03. Individual Rights of the Trustee. The Trustee, in its individual or any other
capacity, may become the owner or pledgee of Notes and may otherwise deal with the Company or its
Affiliates with the same rights it would have if it were not the Trustee. Any Agent may do the
same with like

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rights. However, the Trustee is subject to Trust Indenture Act Sections 310(b) and
311. For purposes of Trust Indenture Act Section 311(b)(4) and (6):

     (a) “cash transaction” means any transaction in which full payment for goods or
securities sold is made within seven days after delivery of the goods or securities in
currency or in checks or other orders drawn upon banks or bankers and payable upon demand;
and

     (b) “self-liquidating paper” means any draft, bill of exchange, acceptance or
obligation which is made, drawn, negotiated or incurred for the purpose of financing the
purchase, processing, manufacturing, shipment, storage or sale of goods, wares or
merchandise and which is secured by documents evidencing title to, possession of, or a
lien upon, the goods, wares or merchandise or the receivables or proceeds arising from the
sale of the goods, wares or merchandise previously constituting the security, provided the
security is received by the Trustee simultaneously with the creation of the creditor
relationship arising from the making, drawing, negotiating or incurring of the draft, bill
of exchange, acceptance or obligation.

     Section 7.04. Trustee’s Disclaimer. The Trustee (a) makes no representation as to the
validity or adequacy of this Indenture or the Notes, (b) is not accountable for the Company’s use
or application of the proceeds from the Notes and (c) is not responsible for any statement in the
Notes other than its certificate of authentication.

     Section 7.05. Reserved.

     Section 7.06. Reports by Trustee to Holders. Within 60 days after each May 1, beginning with
May 1, 2009, the Trustee will mail to each Holder, as provided in Trust Indenture Act Section
313(c) a brief report dated as of such May 1, if required by Trust Indenture Act Section 313(a).

     Section 7.07. Compensation and Indemnity. (a) The Company will pay the Trustee compensation
as agreed upon in writing for its services. The compensation of the Trustee is not limited by any
law on compensation of a trustee of an express trust. The Company will reimburse the Trustee upon
request for all reasonable out-of-pocket expenses, disbursements and advances incurred or made by
the Trustee, including the reasonable compensation and expenses of the Trustee’s agents and
counsel.

     (b) In addition to any other indemnity provided to the Trustee hereunder, the Company will
indemnify the Trustee for, and hold it harmless
against, any loss or liability or expense incurred by it without negligence or bad faith on
its part arising out of or in connection with the acceptance or administration of the Indenture and
its duties under the Indenture and the Notes,

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including the costs and expenses of defending itself
against any claim or liability and of complying with any process served upon it or any of its
officers in connection with the exercise or performance of any of its powers or duties under the
Indenture and the Notes.

     (c) To secure the Company’s payment obligations in this Section or as otherwise provided in
the Indenture, the Trustee will have a lien prior to the Notes on all money or property held or
collected by the Trustee, in its capacity as Trustee, except money or property held in trust to pay
principal of, premium, if any, and interest or Additional Interest, if any, on particular Notes.

     (d) When the Trustee incurs expenses or renders services after an Event of Default specified
in Section 5.01(vii) or Section 5.01(viii) hereof occurs, the expenses and the compensation for the
services (including the fees and expenses of its agents and counsel) are intended to constitute
expenses of administration under any Bankruptcy Law.

     Section 7.08. Replacement of Trustee. (a) (i) The Trustee may resign at any time by written
notice to the Issuer.

     (ii) The Holders of a majority in principal amount of the outstanding Notes may remove
the Trustee by written notice to the Trustee.

     (iii) If the Trustee is no longer eligible under Section 7.10 or in the circumstances
described in Trust Indenture Act Section 310(b), any Holder that satisfies the
requirements of Trust Indenture Act Section 310(b) may petition any court of competent
jurisdiction for the removal of the Trustee and the appointment of a successor Trustee.

     (iv) The Issuer may remove the Trustee if: (A) the Trustee is no longer eligible
under Section 7.10; (B) the Trustee is adjudged bankrupt or an insolvent; (C) a receiver
or other public officer takes charge of the Trustee or its property; or (D) the Trustee
becomes incapable of acting.

A resignation or removal of the Trustee and appointment of a successor Trustee will become
effective only upon the successor Trustee’s acceptance of appointment as provided in this Section.

     (b) If the Trustee has been removed by the Holders, Holders of a majority in principal amount
of the Notes may appoint a successor Trustee with the consent of the Issuer. Otherwise, if the
Trustee resigns or is removed, or if a vacancy exists in the office of Trustee for any reason, the
Issuer will promptly appoint a successor Trustee. If the successor Trustee does not deliver its
written acceptance within 30 days after the retiring Trustee resigns or is removed, the
retiring Trustee, the Issuer or the Holders of a majority in principal amount of the

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outstanding Notes may petition, at the expense of the Issuer, any court of competent jurisdiction
for the appointment of a successor Trustee.

     (c) Upon delivery by the successor Trustee of a written acceptance of its appointment to the
retiring Trustee and to the Issuer, (i) the retiring Trustee will transfer all property held by it
as Trustee to the successor Trustee, subject to the lien provided for in Section 7.07, (ii) the
resignation or removal of the retiring Trustee will become effective, and (iii) the successor
Trustee will have all the rights, powers and duties of the Trustee under the Indenture. Upon
request of any successor Trustee, the Issuer will execute any and all instruments for fully and
vesting in and confirming to the successor Trustee all such rights, powers and trusts. The Issuer
will give notice of any resignation and any removal of the Trustee and each appointment of a
successor Trustee to all Holders, and include in the notice the name of the successor Trustee and
the address of its Corporate Trust Office.

     (d) Notwithstanding replacement of the Trustee pursuant to this Section, Issuer’s obligations
under Section 7.07 will continue for the benefit of the retiring Trustee.

     (e) The Trustee agrees to give the notices provided for in, and otherwise comply with, Trust
Indenture Act Section 310(b).

     Section 7.09. Successor Trustee by Merger. If the Trustee consolidates with, merges or
converts into, or transfers all or substantially all of its corporate trust business to, another
corporation or national banking association, the resulting, surviving or transferee corporation or
national banking association without any further act will be the successor Trustee with the same
effect as if the successor Trustee had been named as the Trustee in the Indenture.

     Section 7.10. Eligibility. The Indenture must always have a Trustee that satisfies the
requirements of Trust Indenture Act Section 310(a) and has a combined capital and surplus of at
least $25,000,000 as set forth in its most recent published annual report of condition.

     Section 7.11. Money Held in Trust. The Trustee will not be liable for interest on any money
received by it except as it may agree with the Issuer. Money held in trust by the Trustee need not
be segregated from other funds except to the extent required by law and except for money held in
trust under Article 8.

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ARTICLE 8

Defeasance and Discharge

     Section 8.01. Legal Defeasance and Discharge. The Issuer, the Company and the Guarantors
shall, subject to the satisfaction of the conditions set forth in
Section 8.03 hereof, be deemed to have been discharged from their respective obligations with
respect to the Notes, the Guarantees and under the Security Documents and cause the release of all
Liens on the Collateral granted under the Security Documents, on the date the conditions set forth
below are satisfied (hereinafter, “Legal Defeasance”). For this purpose, Legal Defeasance means
that the Issuer shall be deemed to have paid and discharged the entire Indebtedness represented by
the Notes, which shall thereafter be deemed to be outstanding only for the purposes of Section 8.04
hereof and the other Sections of this Indenture referred to in clauses (a) through (f) of this
Section 8.01, and the Issuer, the Company and the Guarantors shall be deemed to have satisfied all
of their respective obligations under the Notes, the Guarantees, this Indenture and the Security
Documents (and the Trustee, on demand of and at the expense of the Issuer, shall execute proper
instruments delivered to it by the Issuer acknowledging the same), except of the following
provisions which shall survive until otherwise terminated or discharged hereunder: (a) the rights
of Holders of Notes to receive payments in respect of the principal, premium, if any, and interest
and Additional Interest, if any, on the Notes when such payments are due from the trust referred to
below; (b) the Issuer’s obligations with respect to the Notes concerning mutilated, destroyed, lost
or stolen Notes and the maintenance of an office or agency for payment and money for security
payments held in trust; (c) the rights, powers, trusts, duties and immunities of the Trustee, and
the Issuer’s and the Guarantors’ obligations in connection therewith; (d) the Legal Defeasance
provisions of this Indenture; (e) the rights of registration of transfer and exchange of the Notes;
and (f) the rights of Holders that are beneficiaries with respect to property so deposited with the
Trustee payable to all or any of them.

     Section 8.02. Covenant Defeasance. The Issuer, the Company and the Guarantors shall, subject
to the satisfaction of the conditions set forth in Section 8.03 hereof, be released from their
obligations with respect to the Notes and the Guarantees under the covenants contained in Sections
4.06, 4.07, 4.08, 4.09, 4.10, 4.11, 4.12 and 4.13, clause (iii) of Section 4.14, Section 4.18 and
Article 6 (except for Section 6.03 and Section 6.10) and each Guarantor’s obligation under its
Guarantee, on and after the date that the conditions set forth in Section 8.03 are satisfied and
the Liens on the Collateral granted under the Security Documents will be released (hereinafter,
“Covenant Defeasance”), and the Notes shall thereafter be deemed not outstanding for the purposes
of any direction, waiver, consent or declaration or act of Holders (and the consequences of any
thereof) in connection with such covenants, but shall continue to be deemed outstanding for all
other purposes hereunder (it being understood that the Notes shall not be deemed outstanding for
accounting purposes). For this purpose, Covenant

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Defeasance means that, with respect to the Notes
and the Guarantees, the Issuer, the Company and the Guarantors may omit to comply with and shall
have no liability in respect of any term, condition or limitation set forth in any such covenant,
whether directly or indirectly, by reason of any reference elsewhere herein to any such covenant or
by reason of any reference in any such covenant to any other provision herein or in any other
document and such omission to comply shall not constitute a Default or an Event of Default under
Section 5.01 hereof,
but, except as specified above, the remainder of this Indenture and the Notes shall be
unaffected thereby. Subject to the satisfaction of the conditions set forth in Section 8.03
hereof, Sections 5.01(iii) (with respect to the covenants so defeased), 5.01(iv), 5.01(v),
5.01(vi), 5.01(ix) and 5.01(x) shall not constitute Events of Default or Defaults hereunder.

     Section 8.03. Conditions to Legal or Covenant Defeasance. The following shall be the
conditions to the application of either Section 8.01 or Section 8.02 hereof to the Notes:

     In order to exercise either Legal Defeasance or Covenant Defeasance:

     (a) the Issuer must irrevocably deposit, or cause to be deposited, with the Trustee, in trust,
for the benefit of the Holders of Notes, cash in U.S. dollars, U.S. Government Obligations, or a
combination thereof, in such amounts as will be sufficient, in the opinion of a nationally
recognized firm of independent public accountants, to pay, without reinvestment, the principal of,
premium, if any, and interest and Additional Interest, if any, on the Notes on the stated maturity
thereof or on the applicable redemption date, as the case may be, and the Issuer must specify
whether the Notes are being defeased to maturity or to a particular redemption date;

     (b) in the case of Legal Defeasance, the Issuer must deliver to the Trustee an Opinion of
Counsel reasonably acceptable to the Trustee confirming that the Issuer has received from, or there
has been published by, the Internal Revenue Service a ruling, or there has been a change in the
applicable United States federal income tax law after the date of this Indenture, in either case to
the effect that, and based thereon such Opinion of Counsel shall confirm that, the Holders of Notes
will not recognize income, gain or loss for United States federal income tax purposes as a result
of such Legal Defeasance, and will be subject to United States federal income tax on the same
amounts, in the same manner and at the same times as would have been the case if such Legal
Defeasance had not occurred;

     (c) in the case of Covenant Defeasance, the Issuer must deliver to the Trustee an Opinion of
Counsel reasonably acceptable to the Trustee confirming that the Holders of Notes will not
recognize income, gain or loss for United States federal income tax purposes as a result of such
Covenant Defeasance, and such

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Holders will be subject to United States federal income tax on the
same amounts, in the same manner and at the same times as would have been the case if such Covenant
Defeasance had not occurred;

     (d) no Default or Event of Default shall have occurred and be continuing on the date of such
deposit (other than a Default or Event of Default resulting from the borrowing of funds to be
applied to such deposit) or insofar as Events of Default from bankruptcy or insolvency events are
concerned, at any time in the period ending on the 91st day after the date of deposit;

     (e) such Legal Defeasance or Covenant Defeasance will not result in a breach or violation of,
or constitute a default under, any material agreement or instrument (other than the Indenture) to
which the Issuer or any of its Restricted Subsidiaries is a party or by which the Issuer or any of
its Restricted Subsidiaries is bound;

     (f) the Issuer must deliver to the Trustee an Officers’ Certificate stating that the deposit
was not made by the Issuer with the intent of preferring the Holders of Notes over other creditors
of the Issuer, or with the intent of defeating, hindering, delaying or defrauding creditors of the
Issuer or others; and

     (g) the Issuer must deliver to the Trustee an Officers’ Certificate and an Opinion of Counsel
in the United States reasonably acceptable to the Trustee, each stating that the conditions
precedent provided for or relating to Legal Defeasance or Covenant Defeasance, as applicable, in
the case of the Officers’ Certificate, in clauses (a) through (f) and, in the case of the Opinion
of Counsel, in clauses (b) and (c) of this Section 8.03, have been complied with.

     Section 8.04. Deposited Money and Government Securities to be Held in Trust; Other
Miscellaneous Provisions. Subject to Section 8.05 hereof, all money and U.S. Government
Obligations (including the proceeds thereof) deposited with the Trustee (or other qualifying
trustee, collectively, and solely for purposes of this Section 8.04, the “Trustee”) pursuant to
Section 8.03 or Section 8.08 hereof in respect of the Notes shall be held in trust and applied by
the Trustee, in accordance with the provisions of the Notes and this Indenture, to the payment,
either directly or indirectly or through any paying agent (including the Issuer acting as paying
agent) as the Trustee may determine, to the Holders of such Notes of all sums due and to become due
thereon in respect of principal, premium, if any, interest and Additional Interest, if any, but
such money need not be segregated from other funds except to the extent required by law.

     The Company shall pay and indemnify the Trustee against any tax, fee or other charge imposed
on or assessed against the cash or non-callable U.S. Government Obligations deposited pursuant to
Section 8.03 or Section 8.08 hereof or the principal, premium, if any, interest and Additional
Interest, if any,

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received in respect thereof other than any such tax, fee or other charge which by
law is for the account of the Holders of Notes.

     Subject to the preceding paragraph and Section 7.07 herein, anything in this Article 8 to the
contrary notwithstanding, the Trustee shall deliver or pay, solely to the extent available in such
trust, to the Issuer from time to time upon the request of the Issuer any money or non-callable
U.S. Government Obligations held by it as provided in Section 8.03 or Section 8.08 hereof which, in
the opinion of a nationally recognized firm of independent public accountants expressed in a
written certification thereof delivered to the Trustee (which may be the opinion delivered under
Section 8.03(a) hereof), are in excess of the amount thereof that
would then be required to be deposited to effect an equivalent Legal Defeasance or Covenant
Defeasance.

     Section 8.05. Repayment to Issuer. Any money deposited with the Trustee or any paying agent,
or then held by the Issuer, in trust for the payment of the principal, premium, if any, interest
and Additional Interest, if any, on the Notes and remaining unclaimed for two years after such
principal, premium, if any, interest and Additional Interest, if any, has become due and payable
shall be paid to the Issuer on its request or (if then held by the Issuer) shall be discharged from
such trust; and the Holder of such Note shall thereafter, as an unsecured creditor, look only to
the Issuer for payment thereof, and all liability of the Trustee or such paying agent with respect
to such trust money, and all liability of the Issuer as trustee thereof, shall thereupon cease;
provided, however, that the Trustee or such paying agent, before being required to make any such
repayment, may at the expense of the Issuer cause to be published once, in The New York Times and
The Wall Street Journal (national editions), notice that such money remains unclaimed and that,
after a date specified therein, which shall not be less than 30 days from the date of such
notification or publication, any unclaimed balance of such money then remaining will be repaid to
the Issuer.

     Section 8.06. Reinstatement. If the Trustee or paying agent is unable to apply any money or
non-callable U.S. Government Obligations in accordance with Section 8.01, Section 8.02 or Section
8.08 hereof, as the case may be, by reason of any order or judgment of any court or governmental
authority enjoining, restraining or otherwise prohibiting such application, then the Issuer’s
obligations under this Indenture and the Notes shall be revived and reinstated as though no deposit
had occurred pursuant to Section 8.01, Section 8.02 or Section 8.08 hereof until such time as the
Trustee or paying agent is permitted to apply all such money in accordance with Section 8.01,
Section 8.02 or Section 8.08 hereof, as the case may be; provided, however, that, if the Issuer
makes any payment of principal of, premium, if any, or interest or Additional Interest, if any, on
any Note following the reinstatement of its obligations, the Issuer shall be subrogated to the
rights of the Holders of such Notes to receive such payment from the money held by the Trustee or
paying agent.

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     Section 8.07. Survival. The Trustee’s rights under Article 7 and this Article 8 shall
survive termination of this Indenture.

     Section 8.08. Satisfaction and Discharge of Indenture. If at any time (a) (i) the Issuer
shall have paid or caused to be paid the principal of, premium, if any, and interest and Additional
Interest, if any, on all the outstanding Notes (other than Notes which have been destroyed, lost or
stolen and which have been replaced or paid as provided in Section 2.04) as and when the same shall
have become due and payable, or (ii) the Issuer shall have delivered to the Trustee for
cancellation all Notes theretofore authenticated (other than Notes which have been destroyed, lost
or stolen and which have been replaced or paid as provided in Section 2.04), or (b) (i) the Notes
mature within one year, or all of them are to be
called for redemption within one year under arrangements satisfactory to the Trustee for
giving the notice of redemption, (ii) the Issuer irrevocably deposits in trust with the Trustee, as
trust funds solely for the benefit of the Holders, money or U.S. Government Obligations or a
combination thereof sufficient, in the opinion of a nationally recognized firm of independent
public accountants expressed in a written certificate delivered to the Trustee, without
consideration of any reinvestment, to pay principal of and premium, interest and Additional
Interest, if any, on the Notes to maturity or redemption, as the case may be, and to pay all other
sums payable by it hereunder, (iii) no Default has occurred and is continuing on the date of the
deposit, (iv) the deposit will not result in a breach or violation of, or constitute a default
under, the Indenture or any other agreement or instrument to which the Issuer is a party or by
which it is bound, and (v) the Issuer delivers to the Trustee an Officers’ Certificate and an
Opinion of Counsel, in each case stating that all conditions precedent provided for herein relating
to the satisfaction and discharge of the Indenture have been complied with; and if, in any such
case, the Issuer shall also pay or cause to be paid all other sums payable hereunder by the Issuer
(including all amounts, payable to the Trustee pursuant to Section 7.07), then, (x) after
satisfying the conditions in clause (a), only the Company’s obligations under Sections 7.07 and
8.04 will survive or (y) after satisfying the conditions in clause (b), only the Issuer’s or the
Company’s, as applicable, obligations in Article 2 and Sections 4.01, 4.02, 7.07, 7.08, 8.04, 8.05
and 8.06 will survive, and, in either case, the Trustee, on demand of the Issuer accompanied by an
Officers’ Certificate and an Opinion of Counsel, each stating that all conditions precedent
relating to the satisfaction and discharge contemplated by this provision have been complied with,
and at the cost and expense of the Issuer, shall execute proper instruments acknowledging such
satisfaction and discharging of this Indenture and the Security Documents and cause the release of
all Liens on the Collateral granted under the Security Documents. The Issuer agrees to reimburse
the Trustee for any costs or expenses thereafter reasonably and properly incurred, and to
compensate the Trustee for any services thereafter reasonably and properly rendered, by the Trustee
in connection with this Indenture or the Notes.

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ARTICLE 9

Amendments, Supplements and Waivers

     Section 9.01. Amendments Without Consent of Holders. The Company, the Issuer, the Guarantors
and the Trustee and with respect to the Security Documents, the Collateral Agent, the
Administrative Agent, the Second Lien Notes Collateral Agent, the Second Lien Notes Trustee and the
Mortgage Tax Collateral Agent (as applicable) may amend, supplement or waive the Indenture, the
Notes, the Guarantees or the Security Documents without notice to or the consent of any Holder:

     (a) to evidence the succession of another Person to the Issuer or the Company or successive
successions, and the assumption by the successor Person of the covenants, agreements and
obligations of the Issuer or the Company herein and in the Notes or the Guarantees;

     (b) to add to the covenants of the Issuer or the Company such further covenants, restrictions,
conditions or provisions for the protection of the Holders of Notes, or to surrender any right or
power herein conferred upon the Issuer or the Company, and to make the occurrence, or the
occurrence and continuance, of a default in any such additional covenants, restrictions, conditions
or provisions an Event of Default permitting the enforcement of all or any of the several remedies
provided in this Indenture as herein set forth; provided, however, that in respect of any such
additional covenants, restrictions, conditions or provisions such amendment, supplemented indenture
or waiver may provide for a particular period of grace after default (which period may be shorter
or longer than that allowed in the case of other defaults) or may provide for an immediate
enforcement upon such an Event of Default or may limit the remedies available to the Trustee upon
such an Event of Default or may limit the right of the Holders of a majority in aggregate principal
amount of the Notes to waive such an Event of Default;

     (c) to cure any ambiguity, defect or inconsistency in the Indenture, the Notes, the Guarantees
or the Security Documents;

     (d) to comply with any requirements of the Commission in connection with the qualification of
the Indenture under the Trust Indenture Act;

     (e) to evidence and provide for the acceptance of appointment hereunder by a successor or
replacement Trustee or under the Security Documents of a successor or replacement Collateral Agent;

     (f) to provide for uncertificated Notes in addition to, or in place of, Certificated Notes;

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     (g) to provide for any Guarantee of the Notes, to add security to or for the benefit of the
Notes and, in the case of the Security Documents, to or for the benefit of the other secured
parties named therein, or to confirm and evidence the
release, termination or discharge of any Guarantee of or Lien securing the Notes when such
release, termination or discharge is permitted by the Indenture and the Security Documents;

     (h) to provide for or confirm the issuance of Additional Notes;

     (i) to evidence compliance with Section 4.14;

     (j) to make any other change that does not adversely affect the legal rights of any Holder; or

     (k) to conform any provision of the Indenture, the Notes, the Guarantees or the Security
Documents to the “Description of New Secured Notes” contained in the Issuer’s Confidential Offering
Memorandum dated October 27, 2008 to the extent that the “Description of New Secured Notes” was
intended to be a verbatim recitation of a provision in the Indenture, the Notes, the Guarantees or
the Security Documents.

     In addition, the Collateral Agent, the Trustee, the Administrative Agent, the Second Lien
Notes Collateral Agent, the Second Lien Notes Trustee and the Mortgage Tax Collateral Agent (as
applicable) may amend the Security Documents to add additional secured parties to the extent Liens
securing Obligations held by such parties are permitted under the Indenture, including that after
so securing any such additional secured parties, the amount of First-Priority Lien Obligations and
Second-Priority Lien Obligations do not exceed the amounts set forth under clauses (i)(b) and
(i)(d), respectively, of the definition of “Permitted Liens.”

     Section 9.02. Amendments with Consent of Holders. (a) Except as otherwise provided in
Sections 5.01, 5.03 and 5.06 or Section 9.02(b) of this Section, the Company, the Issuer, the
Guarantors and the Trustee and (with respect to the Security Documents) the Collateral Agent, the
Administrative Agent, the Second Lien Notes Collateral Agent, the Second Lien Notes Trustee and the
Mortgage Tax Collateral Agent (as applicable) may amend or supplement the Indenture, the Notes, the
Guarantees and the Security Documents with the consent of the Holders of a majority in principal
amount of the outstanding Notes (which may include written consents obtained in connection with a
tender offer or exchange offer for Notes), and the Holders of a majority in principal amount of the
outstanding Notes by written notice to the Trustee may waive future compliance by the Company, the
Issuer and the Guarantors with any provision of the Indenture, the Notes, the Guarantees or the
Security Documents (which may

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include waivers obtained in connection with a tender offer or
exchange offer for Notes).

     (b) Notwithstanding the provisions of paragraph (a) of this Section, without the consent of
each Holder affected, an amendment or waiver may not:

     (i) reduce the amount of Notes whose Holders must consent to an amendment, supplement
or waiver,

     (ii) reduce the rate of, or extend the time for payment of, any interest, including
default interest, on any Note,

     (iii) reduce principal of, or change the fixed maturity of, any Note or alter the
provisions (including related definitions) with respect to redemptions described under
Article 3 or with respect to mandatory offers to repurchase Notes described under Section
4.10 and Section 4.12,

     (iv) make any Note payable in money other than that stated in the Note,

     (v) modify the ranking or priority of the Notes or any Guarantee,

     (vi) make any change in Sections 5.03 or 5.06,

     (vii) release any Guarantor from any of its obligations under its Guarantee or the
Indenture otherwise than in accordance with the Indenture,

     (viii) waive a continuing Default or Event of Default in the payment of principal of,
premium, if any, or interest or Additional Interest, if any, on the Notes, or

     (ix) effect a release of all or substantially all of the Collateral other than
pursuant to the terms of the Security Documents or as otherwise permitted under this
Indenture.

     (c) It is not necessary for Holders to approve the particular form of any proposed amendment,
supplement or waiver, but is sufficient if their consent approves the substance thereof.

     (d) An amendment, supplement or waiver under this Section will become effective on receipt by
the Trustee of written consents from the Holders of the requisite percentage in principal amount of
the outstanding Notes. After an amendment, supplement or waiver under this Section becomes
effective, the Issuer (or the Trustee at the request and expense of the Issuer) will send to the

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Holders affected thereby a notice briefly describing the amendment, supplement or waiver. The
Issuer will send supplemental indentures to Holders upon request. Any failure of the Issuer to
send such notice, or any defect therein, will not, however, in any way impair or affect the
validity of any such supplemental indenture, amendment or waiver.

     Section 9.03. Effect of Consent. (a) After an amendment, supplement or waiver becomes
effective, it will bind every Holder unless it is of the type
requiring the consent of each Holder affected. If the amendment, supplement or waiver is of
the type requiring the consent of each Holder affected, the amendment, supplement or waiver will
bind each Holder that has consented to it and every subsequent Holder of a Note that evidences the
same debt as the Note of the consenting Holder.

     (b) If an amendment, supplement or waiver changes the terms of a Note, the Trustee may require
the Holder to deliver it to the Trustee so that the Trustee may place an appropriate notation of
the changed terms on the Note and return it to the Holder, or exchange it for a new Note that
reflects the changed terms. The Trustee may also place an appropriate notation on any Note
thereafter authenticated. However, the effectiveness of the amendment, supplement or waiver shall
not be affected or impaired by any failure to annotate or exchange Notes in this fashion.

     Section 9.04. Trustee’s Rights and Obligations. The Trustee is entitled to receive, in
addition to the documents required by Section 13.04, and will be fully protected in relying upon,
an Opinion of Counsel stating (i) that the execution of any amendment, supplement or waiver
authorized pursuant to this Article is authorized or permitted by the Indenture or the applicable
Security Document and (ii) in the case of an amendment, supplement or waiver in connection with
Section 9.01(j) that such amendment, supplement or waiver does not adversely affect the legal
rights of any Holder of Notes affected by such change. If the Trustee has received such Opinion of
Counsel, it shall sign the amendment, supplement or waiver so long as the same does not adversely
affect the rights of the Trustee. The Trustee may, but is not obligated to, execute any amendment,
supplement or waiver that affects the Trustee’s own rights, duties or immunities under the
Indenture.

     Section 9.05. Conformity with Trust Indenture Act. Every supplemental indenture executed
pursuant to this Article shall conform to the requirements of the Trust Indenture Act.

     Section 9.06. Payments for Consents. Neither the Issuer, the Company nor any of its
Subsidiaries or Affiliates may, directly or indirectly, pay or cause to be paid any consideration,
whether by way of interest, fee or otherwise, to any Holder for or as an inducement to any consent,
waiver or amendment of any of

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the terms or provisions of the Indenture or the Notes unless such
consideration is offered to be paid or agreed to be paid to all Holders of Notes that consent,
waive or agree to amend such term or provision within the time period set forth in the solicitation
documents relating to the consent, waiver or amendment.

ARTICLE 10

Ranking of Liens

     Section 10.01. Agreement for the Benefit of Holders of First-Priority Liens and
Second-Priority Liens. The Trustee and the Collateral Agent agree, and each Holder of Notes by
accepting a Note agrees, that:

     (a) the Liens securing the Third-Priority Lien Obligations upon any and all Collateral are, to
the extent and in the manner provided in the Intercreditor Agreement, subordinate in ranking to all
present and future First-Priority Liens and Second-Priority Liens; and

     (b) the agreements as to the ranking of the Third-Priority Liens set forth in the
Intercreditor Agreement:

     (1) are enforceable by the holders of each of the First-Priority Liens and
Second-Priority Liens, for the benefit of the respective holders of First-Priority Lien
Obligations and Second-Priority Lien Obligations secured thereby; and

     (2) will remain enforceable by the holders of each of the First-Priority Liens and
the Second-Priority Liens until the Discharge of Senior Claims (as defined in the
Intercreditor Agreement).

     (c) without the necessity of any consent of, or notice to, the Trustee or any holder of
Third-Priority Lien Obligations, the Issuer, the Restricted Subsidiaries, the Administrative Agent,
the Second Lien Notes Collateral Agent and Second Lien Notes Trustee may amend, modify, supplement
or terminate any Security Document, subject to the limitations set forth in the Intercreditor
Agreement; provided that the Issuer will use commercially reasonable efforts to notify the Trustee
and the Collateral Agent of any such amendment, modification, supplement or termination (but the
failure to provide such notice shall not affect the applicability, validity or enforceability of
such amendment);

     (d) as among the Collateral Agent, the Trustee and the holders of Third-Priority Lien
Obligations on the one hand and the holders of the First-Priority Lien Obligations and
Second-Priority Lien Obligations on the other hand, the holders of the First-Priority Lien
Obligations and the Administrative Agent will have the sole ability to control and obtain remedies
with respect to all Collateral, and at any time when First-Priority Lien Obligations are no longer
outstanding

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and while Second-Priority Lien Obligations are outstanding, the holders of the
Second-Priority Lien Obligations, the Second Lien Notes Collateral Agent and the Second Lien Notes
Trustee will have the sole ability to control and obtain remedies with respect to all Collateral,
in each case, without the necessity of any consent of or notice to the Collateral Agent, the
Trustee or any such holder, as set forth in more detail in the Intercreditor Agreement;

     (e) any or all Liens as set forth in, and granted under the Security Documents for the benefit
of the Holders will be automatically and unconditionally released, without the necessity of any
consent of the Collateral Agent, the Trustee or any Holders, upon a release of both the
First-Priority Liens and the Second-Priority Liens on such Collateral, but will not be so released
if the release is in connection with the (i) payment in full of the First-Priority Lien Obligations
and in such circumstance, the Second-Priority Lien Obligations are not released in accordance with
the Second Lien Notes Indenture and the Intercreditor Agreement or (ii) the payment in full of the
First-Priority Lien Obligations and in such circumstance, the Second-Priority Liens are released in
connection with the repayment in full of the Second Lien Notes in accordance with the Second Lien
Notes Indenture and the Intercreditor Agreement, subject, in each case, to the exceptions set forth
in Section 5.1 of the Intercreditor Agreement; and

     (f) the Indenture, Notes, Guarantees and Security Documents are subject to the Intercreditor
Agreement.

     Section 10.02. Notes, Guarantees and Other Third-Priority Lien Obligations not Subordinated.
The provisions of this Article 10 are intended solely to set forth the relative ranking, as Liens,
of the Third-Priority Liens as against each of the First-Priority Liens and the Second-Priority
Liens. The Notes and Guarantees are senior non-subordinated obligations of the Issuer and
Guarantors. Neither the Notes, the Guarantees and other Third-Priority Lien Obligations nor the
exercise or enforcement of any right or remedy for the payment or collection thereof (other than
the exercise of rights and remedies of a secured party, which are subject to the Intercreditor
Agreement) are intended to be, or will ever be by reason of the provisions of this Article 10, in
any respect subordinated, deferred, postponed, restricted or prejudiced.

     Section 10.03. Relative Rights. The Intercreditor Agreement defines the relative rights, as
lienholders, of holders of Third-Priority Liens, holders of First-Priority Liens and holders of
Second-Priority Liens. Nothing in this Indenture or the Intercreditor Agreement will:

     (a) impair, as between the Issuer and Holders of Notes, the obligation of the Issuer, which is
absolute and unconditional, to pay principal of, premium and interest on the Notes in accordance
with their terms or to perform any other

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obligation of the Issuer or any other obligor under the
Indenture, Notes, Guarantees and Security Documents;

     (b) restrict the right of any Holder of Notes to sue for payments that are then due and owing;

     (c) prevent the Trustee, the Collateral Agent or any Holder of Notes from exercising against
the Issuer or any other obligor any of its other available
remedies upon a Default or Event of Default (other than its rights as a secured party, which
are subject to the Intercreditor Agreement); or

     (d) restrict the right of the Trustee, the Collateral Agent or any Holder of Notes:

     (1) to file and prosecute a petition seeking an order for relief in an involuntary
bankruptcy case as to any obligor or otherwise to commence, or seek relief commencing, any
insolvency or liquidation proceeding involuntarily against any obligor;

     (2) to make, support or oppose any request for an order for dismissal, abstention or
conversion in any insolvency or liquidation proceeding;

     (3) to make, support or oppose, in any insolvency or liquidation proceeding, any
request for an order extending or terminating any period during which the debtor (or any
other Person) has the exclusive right to propose a plan of reorganization or other
dispositive restructuring or liquidation plan therein;

     (4) to seek the creation of, or appointment to, any official committee representing
creditors (or certain of the creditors) in any insolvency or liquidation proceedings and,
if appointed, to serve and act as a member of such committee without being in any respect
restricted or bound by, or liable for, any of the obligations under this Article 10;

     (5) to seek or object to the appointment of any professional person to serve in any
capacity in any insolvency or liquidation proceeding or to support or object to any
request for compensation made by any professional person or others therein;

     (6) to make, support or oppose any request for an order appointing a trustee or
examiner in any insolvency or liquidation proceedings; or

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     (7) otherwise to make, support or oppose any request for relief in any insolvency or
liquidation proceeding that it is permitted by law to make, support or oppose:

     (x) if it were a holder of unsecured claims; or

     (y) as to any matter relating to any plan of reorganization or other
restructuring or liquidation plan or as to any matter relating to the
administration of the estate or the disposition of the case or proceeding;

in each case, except as set forth in the Intercreditor Agreement.

ARTICLE 11

Collateral and Security

     Section 11.01. Security Documents. The payment of the principal of and interest and premium,
if any, on the Notes when due, whether on an interest payment date, at maturity, by acceleration,
repurchase, redemption or otherwise and whether by the Issuer pursuant to the Notes or by any
Guarantor pursuant to its Guarantees, the payment of all other Third-Priority Lien Obligations and
the performance of all other obligations of the Issuer and the Guarantors under the Indenture, the
Notes, the Guarantees and the Security Documents are secured by Third-Priority Liens on the
Collateral, subject to Permitted Liens, as provided in the Security Documents which the Issuer and
the Guarantors have entered into simultaneously with the execution of this Indenture, or in certain
circumstances, subsequent to the Issue Date, and will be secured as provided in the Security
Documents hereafter delivered as required or permitted by this Indenture.

     Section 11.02. Collateral Agent.

     (a) The Issuer hereby appoints Wilmington Trust Company to act as Collateral Agent, and the
Collateral Agent shall have the privileges, powers and immunities as set forth herein and in the
Security Documents. The Issuer and the Guarantors hereby agree that the Collateral Agent shall
hold the Collateral in trust for the benefit of all of the Holders and the Trustee, in each case,
pursuant to the terms of the Security Documents and the Collateral Agent is hereby authorized to
execute and deliver the Security Documents. Subject to the Intercreditor Agreement, the Collateral
Agent is authorized and empowered to appoint one or more co-Collateral Agents as it deems necessary
or appropriate.

     (b) Subject to Section 7.01, neither the Trustee nor the Collateral Agent nor any of their
respective officers, directors, employees, attorneys or agents will be responsible or liable for
the existence, genuineness, value or protection of any Collateral, for the legality,
enforceability, effectiveness or sufficiency of the

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Security Documents, for the creation,
perfection, priority, sufficiency or protection of any Third-Priority Lien, or for any defect or
deficiency as to any such matters, or for any failure to demand, collect, foreclose or realize upon
or otherwise enforce any of the Third-Priority Liens or Security Documents or any delay in doing
so.

     (c) The Collateral Agent will be subject to such directions as may be given it by the Trustee
from time to time (as required or permitted by this Indenture). Except as directed by the Trustee
as required or permitted by this Indenture or as required or permitted by the Security Documents,
the Collateral Agent will not be obligated:

     (1) to act upon directions purported to be delivered to it by any other Person;

     (2) to foreclose upon or otherwise enforce any Third-Priority Lien; or

     (3) to take any other action whatsoever with regard to any or all of the
Third-Priority Liens, Security Documents or Collateral.

     (d) The Collateral Agent will be accountable only for amounts that it actually receives as a
result of the enforcement of the Third-Priority Liens or the Security Documents.

     (e) In acting as Collateral Agent or co-Collateral Agent, the Collateral Agent and each
co-Collateral Agent may rely upon and enforce for its own benefit each and all of the rights,
powers, immunities, indemnities and benefits of the Trustee under Article 7 hereof, each of which
shall also be deemed to be for the benefit of the Collateral Agent.

     (f) At all times when the Trustee is not itself the Collateral Agent, the Issuer will deliver
to the Trustee copies of all Security Documents delivered to the Collateral Agent and copies of all
documents delivered to the Collateral Agent pursuant to the Security Documents.

     Section 11.03. Authorization of Actions to be Taken.

     (a) Each Holder of Notes, by its acceptance thereof, consents and agrees to the terms of each
Security Document, as originally in effect on the Issue Date and as amended, supplemented or
replaced from time to time in accordance with its terms or the terms of this Indenture, authorizes
and directs the Trustee and the Collateral Agent to execute and deliver the Security Documents to
which it is a party and authorizes and empowers the Trustee and the Collateral Agent to bind the
Holders of Notes and other holders of Third-Priority Lien Obligations as set

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forth in the Security
Documents to which it is a party and to perform its obligations and exercise its rights and powers
thereunder.

     (b) The Collateral Agent and the Trustee are authorized and empowered to receive for the
benefit of the Holders of Notes any funds collected or distributed under the Security Documents to
which the Collateral Agent or Trustee is a party and to make further distributions of such funds to
the Holders of Notes according to the provisions of this Indenture.

     (c) Subject to the provisions of Section 7.01, Section 7.02, Article 10 and the Intercreditor
Agreement, the Trustee may, in its sole discretion and without the consent of the Holders of Notes,
direct, on behalf of the Holders of Notes, the Collateral Agent to take all actions it deems
necessary or appropriate in order to:

     (1) foreclose upon or otherwise enforce any or all of the Third-Priority Liens;

     (2) enforce any of the terms of the Security Documents to which the Collateral Agent
or Trustee is a party; or

     (3) collect and receive payment of any and all Third-Priority Lien Obligations.

     Subject to the Intercreditor Agreement, Section 7.01, Section 7.02 and Article 10, the Trustee
is authorized and empowered to institute and maintain, or direct the Collateral Agent to institute
and maintain, such suits and proceedings as it may deem expedient to protect or enforce the
Third-Priority Liens or the Security Documents to which the Collateral Agent or Trustee is a party
or to prevent any impairment of Collateral by any acts that may be unlawful or in violation of the
Security Documents to which the Collateral Agent or Trustee is a party or this Indenture, and such
suits and proceedings as the Trustee or the Collateral Agent may deem expedient to preserve or
protect its interests and the interests of the Holders of Notes in the Collateral, including power
to institute and maintain suits or proceedings to restrain the enforcement of or compliance with
any legislative or other governmental enactment, rule or order that may be unconstitutional or
otherwise invalid if the enforcement of, or compliance with, such enactment, rule or order would
impair the security interest hereunder or be prejudicial to the interests of Holders of Notes, the
Trustee or the Collateral Agent.

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     Section 11.04. Release of Third-Priority Liens.

     (a) The Third-Priority Liens will be released, with respect to the Notes and the Guarantees:

     (1) in whole, in accordance with Section 5.1 of the Intercreditor Agreement;

     (2) in whole, upon payment in full of the principal of, accrued and unpaid interest
and premium, if any, on the Notes and payment in full of all other Third-Priority Lien
Obligations in respect thereof that are due and payable at or prior to the time such
principal, accrued and unpaid interest and premium, if any, on the Notes are paid;

     (3) in whole, upon satisfaction and discharge of this Indenture pursuant to Section
8.08;

     (4) in whole, upon a legal defeasance or covenant defeasance pursuant to Article 8;

     (5) in part, as to any property constituting Collateral that (a) is sold or otherwise
disposed of by the Issuer or one of the Restricted Subsidiaries to any Person other than
the Company, the Issuer or any of its Restricted Subsidiaries (but excluding any
transaction subject to Section 4.14 where the recipient is required to become the obligor
on the Notes or
a Guarantee) in a transaction permitted by this Indenture, at the time of such sale
or disposition, to the extent of the interest sold or disposed of, (b) is to be released,
in whole or in part, pursuant to Section 5.1 of the Intercreditor Agreement, (c) is owned
or at any time acquired by a Restricted Subsidiary that has been released from its
Guarantee under this Indenture, concurrently with the release of such Guarantee, or (d)
consists of securities of a Guarantor of the Issuer to be released as contemplated by
Section 4.18(c); or

     (6) In accordance with and subject to the provisions of Article 9, with the consent
of Holders of a majority in principal amount of the outstanding Notes or each Holder
affected if required by Section 9.02(b)(ix) (including consents obtained in connection
with a tender offer or exchange offer).

     (b) If an instrument confirming the release of the Third-Priority Liens pursuant to Section
11.04(a) is requested by the Issuer or a Guarantor, then upon delivery to the Trustee of an
Officers’ Certificate requesting execution of such an instrument, accompanied by:

     (1) an Opinion of Counsel confirming that such release is permitted by Section
11.04(a);

     (2) all instruments requested by the Issuer to effectuate or confirm such release;
and

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     (3) such other certificates and documents as the Trustee or Collateral Agent may
reasonably request to confirm the matters set forth in Section 11.04(a) that are required
by this Indenture or the Security Documents,

the Trustee will, if such instruments and documents are reasonably satisfactory to the Trustee and
Collateral Agent, instruct the Collateral Agent to execute and deliver, and the Collateral Agent
will promptly execute and deliver, such instruments.

     (c) All instruments effectuating or confirming any release of any Third-Priority Liens will
have the effect solely of releasing such Third-Priority Liens as to the Collateral described
therein, on customary terms and without any recourse, representation, warranty or liability
whatsoever.

     (d) The Issuer will bear and pay all costs and expenses associated with any release of
Third-Priority Liens pursuant to this Section 11.04, including all reasonable fees and
disbursements of any attorneys or representatives acting for the Trustee or for the Collateral
Agent.

     Section 11.05. Filing, Recording and Opinions.

     (a) The Issuer will comply with the provisions of TIA §314(b) and §314(d), in each case
following qualification of this Indenture pursuant to the TIA. Any certificate or opinion required
by TIA §314(d) may be made by an Officer of the Issuer except in cases where TIA §314(d) requires
that such certificate or opinion be made by an independent engineer, appraiser or other expert, who
shall be reasonably satisfactory to the Trustee. Notwithstanding anything to the contrary herein,
the Issuer and the Guarantors will not be required to comply with all or any portion of TIA §314(d)
if they determine, in good faith based on advice of counsel (which may be internal counsel), that
under the terms of that section and/or any interpretation or guidance as to the meaning thereof of
the Commission and its staff, including “no action” letters or exemptive orders, all or any portion
of TIA §314(d) is inapplicable to the released Collateral. Following the qualification of this
Indenture pursuant to the TIA, to the extent the Issuer is required to furnish to the Trustee an
Opinion of Counsel pursuant to TIA §314(b)(2), the Issuer will furnish such opinion prior to each
December 3.

     Any release of Collateral permitted by Section 11.04 hereof or the Security Documents will be
deemed not to impair the Liens under the Indenture and the Security Documents in contravention
thereof and any person that is required to deliver a certificate or opinion pursuant to Section
314(d) of the TIA or otherwise under this Indenture or the Security Documents, shall be entitled to
rely upon the foregoing as a basis for delivery of such certificate or opinion. The Trustee may,
to the extent permitted by Section 7.01 and 7.02 hereof, accept as

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conclusive evidence of
compliance with the foregoing provisions the appropriate statements contained in such documents and
opinion.

     (b) If any Collateral is released in accordance with this Indenture or any Security Document
at a time when the Trustee is not itself also the Collateral Agent and if the Issuer has delivered
the certificates and documents required by the Security Documents and permitted to be delivered by
Section 11.04 (if any), the Trustee will determine whether it has received all documentation
required by TIA §314(d) in connection with such release and, based on such determination and the
Opinion of Counsel delivered pursuant to Section 11.04, if any, will, upon request, deliver a
certificate to the Collateral Agent setting forth such determination.

ARTICLE 12

Release of Issuer and Guarantors

     Section 12.01. Release of Issuer. (a) The Issuer shall be released from its obligations
under this Indenture and the Notes, without the consent of the Holders, if: (1) the Company or any
successor to the Company has assumed the obligations of the Issuer under this Indenture and the
Notes, by supplemental indenture executed and delivered to the Trustee and satisfactory in form to
the Trustee, (2) the Company delivers an Opinion of Counsel to the Trustee to the effect that
Holders will not recognize income, gain or loss for United States federal income tax purposes as a
result of such release and such Holders will be
subject to United States federal income tax on the same amounts, in the same manner and at the
same times as would have been the case if such release had not occurred and (3) the Issuer shall
(w) become a Guarantor subject to the provisions of Article 6 and Section 4.11 hereof, (x) execute
a Guarantee, (y) execute a supplemental indenture evidencing its Guarantee and (z) deliver an
Opinion of Counsel to the Trustee to the effect that the supplemental indenture has been duly
authorized, executed and delivered by the Issuer and constitutes a valid and binding obligation of
the Issuer, enforceable against the Issuer in accordance with its terms (subject to customary
exceptions).

     (b) A Guarantor may be released from its obligations under the Indenture, the Notes and its
Guarantee in accordance with the provisions contained in Section 6.03 herein.

ARTICLE 13

Miscellaneous

     Section 13.01. Trust Indenture Act of 1939. The Indenture shall incorporate and be governed
by the provisions of the Trust Indenture Act that are required to be part of and to govern
indentures qualified under the Trust Indenture Act. To the extent permitted by applicable law, in
the event of any inconsistency

104

 

between the terms of the Notes and the terms of the Indenture, the
terms of the Indenture will control; provided however that provisions of TIA §314(b) and §314(d),
in each case, shall not apply until qualification of this Indenture under the TIA.

     Section 13.02. Holder Communications; Holder Actions. (a) The rights of Holders to
communicate with other Holders with respect to the Indenture or the Notes are as provided by the
Trust Indenture Act, and the Company and the Issuer shall comply with the requirements of Trust
Indenture Act § 312(a). Neither the Company, the Issuer nor the Trustee will be held accountable
by reason of any disclosure of information as to names and addresses of Holders made pursuant to
the Trust Indenture Act.

     (b) (i) any request, demand, authorization, direction, notice, consent to amendment,
supplement or waiver or other action provided by this Indenture to be given or taken by a Holder
(an “act”) may be evidenced by an instrument signed by the Holder delivered to the Trustee. The
fact and date of the execution of the instrument, or the authority of the person executing it, may
be proved in any manner that the Trustee deems sufficient.

     (ii) The Trustee may make reasonable rules for action by or at a meeting of Holders,
which will be binding on all the Holders.

     (c) Any act by the Holder of any Note binds that Holder and every subsequent Holder of a Note
that evidences the same debt as the Note of the acting Holder, even if no notation thereof appears
on the Note. Subject to
paragraph (d), a Holder may revoke an act as to its Notes, but only if the Trustee receives
the notice of revocation before the date the amendment or waiver or other consequence of the act
becomes effective.

     (d) The Issuer may, but is not obligated to, fix a record date (which need not be within the
time limits otherwise prescribed by Trust Indenture Act § 316(c)) for the purpose of determining
the Holders entitled to act with respect to any amendment or waiver or in any other regard, except
that during the continuance of an Event of Default, only the Trustee may set a record date as to
notices of Default, any declaration or acceleration or any other remedies or other consequences of
the Event of Default. If a record date is fixed, those Persons that were Holders at such record
date and only those Persons will be entitled to act, or to revoke any previous act, whether or not
those Persons continue to be Holders after the record date. No act will be valid or effective for
more than 90 days after the record date.

     Section 13.03. Notices. (a) Any notice or communication to the Issuer or the Company will be
deemed given if in writing (i) when delivered in person or (ii) five days after mailing when mailed
by first class mail or (iii) when sent by

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facsimile transmission, with transmission confirmed.
Notices or communications to a Guarantor will be deemed given if given to the Company. Any notice
to the Trustee will be effective only upon receipt. In each case the notice or communication
should be addressed as follows:

     if to the Issuer or the Company:

K. Hovnanian Enterprises, Inc.

110 West Front Street

Box 500

Red Bank, NJ 07701

Facsimile: (732) 383-2945

Attention: General Counsel

     if to the Trustee:

Wilmington Trust Company

Rodney Square North

1100 North Market Street

Wilmington, DE 19890-1605

Facsimile: 302-636-4149

Attention: Corporate Client Services

The Issuer or the Trustee by notice to the other may designate additional or different addresses
for subsequent notices or communications.

     (b) Except as otherwise expressly provided with respect to published notices, any notice or
communication to a Holder will be deemed given when mailed to the Holder at its address as it
appears on the Register by first class mail
or, as to any Global Note registered in the name of DTC or its nominee, as agreed by the
Issuer, the Trustee and DTC. Copies of any notice or communication to a Holder, if given by the
Issuer or the Company, will be mailed to the Trustee at the same time. Defect in mailing a notice
or communication to any particular Holder will not affect its sufficiency with respect to other
Holders.

     (c) Where the Indenture provides for notice, the notice may be waived in writing by the Person
entitled to receive such notice, either before or after the event, and the waiver will be the
equivalent of the notice. Waivers of notice by Holders must be filed with the Trustee, but such
filing is not a condition precedent to the validity of any action taken in reliance upon such
waivers.

     Section 13.04. Certificate and Opinion as to Conditions Precedent. Upon any request or
application by the Issuer or the Company to the Trustee to take any action under the Indenture, the
Issuer or the Company will furnish to the Trustee:

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     (a) an Officers’ Certificate stating that, in the opinion of the signers, all
conditions precedent, if any, provided for in the Indenture relating to the proposed
action have been complied with; and

     (b) an Opinion of Counsel stating that all such conditions precedent relating to the
proposed action have been complied with.

     Section 13.05. Statements Required in Certificate or Opinion. Each certificate or opinion
with respect to compliance with a condition or covenant provided for in the Indenture must include:

     (a) a statement that each person signing the certificate or opinion has read the
covenant or condition and the related definitions;

     (b) a brief statement as to the nature and scope of the examination or investigation
upon which the statement or opinion contained in the certificate or opinion is based;

     (c) a statement that, in the opinion of each such person, that person has made such
examination or investigation as is necessary to enable the person to express an informed
opinion as to whether or not such covenant or condition has been complied with; and

     (d) a statement as to whether or not, in the opinion of each such person, such
condition or covenant has been complied with, provided, that an Opinion of Counsel may
rely on an Officers’ Certificate or certificates of public officials with respect to
matters of fact.

     Any certificate, statement or opinion of an Officer of the Issuer or the Company, as
applicable, may be based, insofar as it relates to legal matters, upon a certificate or opinion of
or representations by counsel, unless such Officer knows that the certificate or opinion or
representations with respect to the matters
upon which such certificate, statement or opinion may be based as aforesaid are erroneous, or
in the exercise of reasonable care should know that the same are erroneous. Any certificate,
statement or Opinion of Counsel may be based, insofar as it relates to factual matters on
information with respect to which is in the possession of the Issuer, or the Company, as
applicable, upon the certificate, statement or opinion of or representations by an officer or
officers of the Issuer, or the Company, as applicable, unless such counsel knows that the
certificate, statement or opinion or representations with respect to the matters upon which such
certificate, statement or opinion may be based as aforesaid are erroneous, or in the exercise of
reasonable care should know that the same are erroneous.

     Any certificate, statement or opinion of an Officer of the Issuer or the Company, as
applicable, or of counsel may be based, insofar as it relates to accounting matters, upon a
certificate or opinion of or representations by an

107

 

accountant or firm of accountants in the employ
of the Issuer or the Company, as applicable, unless such Officer or counsel, as the case may be,
knows that the certificate or opinion or representations with respect to the accounting matters
upon which such certificate, statement or opinion may be based as aforesaid are erroneous, or in
the exercise of reasonable care should know that the same are erroneous.

     Any certificate or opinion of any independent firm of public accountants filed with and
directed to the Trustee shall contain a statement that such firm is independent.

     Section 13.06. Payment Date Other Than a Business Day. If any payment with respect to a
payment of any principal of, premium, if any, or interest or Additional Interest, if any, on any
Note (including any payment to be made on any date fixed for redemption or purchase of any Note) is
due on a day which is not a Business Day, then the payment need not be made on such date, but may
be made on the next Business Day with the same force and effect as if made on such date, and no
interest will accrue for the intervening period.

     Section 13.07. Governing Law. The Indenture, the Guarantees and the Notes shall be governed
by, and construed in accordance with, the laws of the State of New York.

     Section 13.08. No Adverse Interpretation of Other Agreements. The Indenture may not be used
to interpret another indenture or loan or debt agreement of the Issuer, the Company or any
Subsidiary of the Company, and no such indenture or loan or debt agreement may be used to interpret
the Indenture.

     Section 13.09. Successors. All agreements of the Issuer, the Company or any Guarantor in the
Indenture and the Notes will bind its successors. All agreements of the Trustee in the Indenture
will bind its successor.

     Section 13.10. Duplicate Originals. The parties may sign any number of copies of the
Indenture. Each signed copy shall be an original, but all of them together represent the same
agreement.

     Section 13.11. Separability. To the extent permitted by applicable law, in case any
provision in the Indenture or in the Notes is invalid, illegal or unenforceable, the validity,
legality and enforceability of the remaining provisions will not in any way be affected or impaired
thereby.

     Section 13.12. Table of Contents and Headings. The Table of Contents, Cross-Reference Table
and headings of the Articles and Sections of the Indenture have been inserted for convenience of
reference only, are not to be considered a part of the Indenture and in no way modify or restrict
any of the terms and provisions of the Indenture.

108

 

     Section 13.13. No Liability of Directors, Officers, Employees, Partners, Incorporators and
Stockholders. No recourse under or upon any obligation, covenant or agreement contained in this
Indenture, or in the Notes, or because of any indebtedness evidenced thereby, shall be had against
any incorporator, as such or against any past, present or future stockholder, officer, director or
employee, as such, of the Issuer, the Company or the Guarantors or any partner of the Issuer, the
Company or the Guarantors or of any successor, either directly or through the Issuer, the Company
or the Guarantors or any successor, under any rule of law, statute or constitutional provision or
by the enforcement of any assessment or by any legal or equitable proceeding or otherwise, all such
liability being expressly waived and released by the acceptance of the Notes by the Holders thereof
and as part of the consideration for the issue of the Notes.

     Section 13.14. Provisions of Indenture for the Sole Benefit of Parties and Holders of Notes.
Nothing in this Indenture or in the Notes, expressed or implied, shall give or be construed to give
to any Person, other than the parties hereto and their successors and the Holders of Notes, any
legal or equitable right, remedy or claim under this Indenture or under any covenant or provision
herein contained, all such covenants and provisions being for the sole benefit of the parties
hereto and their successors and of the Holders of Notes.

[Signature page follows]

109

 

SIGNATURES

     IN WITNESS WHEREOF, the parties hereto have caused the Indenture to be duly executed as of the
date first written above.

	 	 	 	 	 
	 	K. HOVNANIAN ENTERPRISES, INC., 

     as Issuer

 	 
	 	By:  	/s/      Peter S. Reinhart
 	 
	 	 	Name:  	Peter S. Reinhart 	 
	 	 	Title:  	Senior Vice President 	 
	 
	 	HOVNANIAN ENTERPRISES, INC.,

     as the Company and a Guarantor

 	 
	 	By:  	/s/       Peter S. Reinhart
 	 
	 	 	Name:  	Peter S. Reinhart 	 
	 	 	Title:  	Senior Vice President 	 
	 
	 	On behalf of each entity named in 

     Schedule A hereto, as a Guarantor

 	 
	 	By:  	/s/       Peter S. Reinhart
 	 
	 	 	Name:  	Peter S. Reinhart 	 
	 	 	Title:  	Authorized Officer 	 
	 

	 	 	 	 	 
	 	WILMINGTON TRUST COMPANY,

     as Trustee

 	 
	 	By:  	/s/        Patrick J. Healy
 	 
	 	 	Name:  	Patrick J. Healy 	 
	 	 	Title:  	Vice President 	 
	 

[Signature page to the Indenture]

110

 

SCHEDULE A

GUARANTORS

ALFORD, L.L.C.

AUDDIE ENTERPRISES, L.L.C.

BUILDER SERVICES NJ, L.L.C.

BUILDER SERVICES NY, L.L.C.

BUILDER SERVICES PA, L.L.C.

DULLES COPPERMINE, L.L.C.

EASTERN TITLE AGENCY, INC.

F&W MECHANICAL SERVICES, L.L.C.

FOUNDERS TITLE AGENCY OF MARYLAND, L.L.C.

FOUNDERS TITLE AGENCY, INC.

GOVERNOR’S ABSTRACT CO., INC.

GREENWAY FARMS UTILITY ASSOCIATES, L.L.C.

HOMEBUYERS FINANCIAL SERVICES, L.L.C.

HOVNANIAN DEVELOPMENTS OF FLORIDA, INC.

HOVNANIAN LAND INVESTMENT GROUP OF CALIFORNIA, L.L.C.

HOVNANIAN LAND INVESTMENT GROUP OF FLORIDA, L.L.C.

HOVNANIAN LAND INVESTMENT GROUP OF GEORGIA, L.L.C.

HOVNANIAN LAND INVESTMENT GROUP OF MARYLAND, L.L.C.

HOVNANIAN LAND INVESTMENT GROUP OF NEW JERSEY, L.L.C.

HOVNANIAN LAND INVESTMENT GROUP OF NORTH CAROLINA, L.L.C.

HOVNANIAN LAND INVESTMENT GROUP OF PENNSYLVANIA, L.L.C.

HOVNANIAN LAND INVESTMENT GROUP OF TEXAS, L.L.C.

HOVNANIAN LAND INVESTMENT GROUP OF VIRGINIA, L.L.C.

HOVNANIAN LAND INVESTMENT GROUP, L.L.C.

K. H. SAN MARCOS CONSERVANCY HOLDINGS L.L.C.

K. HOV I P, INC.

K. HOV INTERNATIONAL, INC.

K. HOV IP, II, INC.

K. HOVNANIAN ACQUISITIONS, INC.

K. HOVNANIAN AT 3 CHAPMAN, L.L.C.

K. HOVNANIAN AT 4S, LLC

K. HOVNANIAN AT ABERDEEN URBAN RENEWAL, L.L.C.

K. HOVNANIAN AT ACQUA VISTA, LLC

K. HOVNANIAN AT ALISO, LLC

K. HOVNANIAN AT ALLENBERRY, L.L.C.

K. HOVNANIAN AT ALLENDALE, L.L.C.

K. HOVNANIAN AT ALLENTOWN, L.L.C.

K. HOVNANIAN AT ARBOR HEIGHTS, LLC

K. HOVNANIAN AT AVENUE ONE, L.L.C.

K. HOVNANIAN AT BARNEGAT I, L.L.C.

K. HOVNANIAN AT BARNEGAT II, L.L.C.

K. HOVNANIAN AT BARNEGAT III, L.L.C.

K. HOVNANIAN AT BELLA LAGO, LLC

K. HOVNANIAN AT BERKELEY, L.L.C.

K. HOVNANIAN AT BERNARDS IV, INC.

K. HOVNANIAN AT BERNARDS V, L.L.C.

K. HOVNANIAN AT BLUE HERON PINES, L.L.C.

K. HOVNANIAN AT BRANCHBURG III, INC.

K. HOVNANIAN AT BRIDGEPORT, INC.

Sch. A-1 

 

K. HOVNANIAN AT BRIDGEWATER I, L.L.C.

K. HOVNANIAN AT BRIDGEWATER VI, INC.

K. HOVNANIAN AT BRIDLEWOOD, L.L.C.

K. HOVNANIAN AT BROAD AND WALNUT, L.L.C.

K. HOVNANIAN AT BURLINGTON III, INC.

K. HOVNANIAN AT BURLINGTON, INC.

K. HOVNANIAN AT CALABRIA, INC.

K. HOVNANIAN AT CAMDEN I, L.L.C.

K. HOVNANIAN AT CAMERON CHASE, INC.

K. HOVNANIAN AT CAMP HILL, L.L.C.

K. HOVNANIAN AT CAPISTRANO, L.L.C.

K. HOVNANIAN AT CARMEL DEL MAR, INC.

K. HOVNANIAN AT CARMEL VILLAGE, LLC

K. HOVNANIAN AT CASTILE, INC.

K. HOVNANIAN AT CEDAR GROVE III, L.L.C.

K. HOVNANIAN AT CEDAR GROVE IV, L.L.C.

K. HOVNANIAN AT CHAPARRAL, INC.

K. HOVNANIAN AT CHESTER I, L.L.C.

K. HOVNANIAN AT CHESTERFIELD II, L.L.C.

K. HOVNANIAN AT CHESTERFIELD, L.L.C.

K. HOVNANIAN AT CIELO, L.L.C.

K. HOVNANIAN AT CLARKSTOWN, INC.

K. HOVNANIAN AT CLIFTON II, L.L.C.

K. HOVNANIAN AT CLIFTON, L.L.C.

K. HOVNANIAN AT COASTLINE, L.L.C.

K. HOVNANIAN AT CORTEZ HILL, LLC

K. HOVNANIAN AT CRANBURY, L.L.C.

K. HOVNANIAN AT CRESTLINE, INC.

K. HOVNANIAN AT CURRIES WOODS, L.L.C.

K. HOVNANIAN AT DENVILLE, L.L.C.

K. HOVNANIAN AT DEPTFORD TOWNSHIP, L.L.C.

K. HOVNANIAN AT DOMINGUEZ HILLS, INC.

K. HOVNANIAN AT DOVER, L.L.C.

K. HOVNANIAN AT EAST BRANDYWINE, L.L.C.

K. HOVNANIAN AT EAST WHITELAND I, INC.

K. HOVNANIAN AT EASTLAKE, LLC

K. HOVNANIAN AT EDGEWATER II, L.L.C.

K. HOVNANIAN AT EDGEWATER, L.L.C.

K. HOVNANIAN AT EGG HARBOR TOWNSHIP II, L.L.C.

K. HOVNANIAN AT EGG HARBOR TOWNSHIP, L.L.C.

K. HOVNANIAN AT ELK TOWNSHIP, L.L.C.

K. HOVNANIAN AT ENCINITAS RANCH, LLC

K. HOVNANIAN AT EVERGREEN, L.L.C.

K. HOVNANIAN AT EWING, L.L.C.

K. HOVNANIAN AT FIFTH AVENUE, L.L.C.

K. HOVNANIAN AT FLORENCE I, L.L.C.

K. HOVNANIAN AT FLORENCE II, L.L.C.

K. HOVNANIAN AT FOREST MEADOWS, L.L.C.

K. HOVNANIAN AT FORKS TWP. I, L.L.C.

K. HOVNANIAN AT FRANKLIN, L.L.C.

K. HOVNANIAN AT FREEHOLD TOWNSHIP I, INC.

K. HOVNANIAN AT FREEHOLD TOWNSHIP, L.L.C.

K. HOVNANIAN AT GALLOWAY, L.L.C.

K. HOVNANIAN AT GASLAMP SQUARE, L.L.C.

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K. HOVNANIAN AT GREAT NOTCH, L.L.C.

K. HOVNANIAN AT GUTTENBERG, L.L.C.

K. HOVNANIAN AT HACKETTSTOWN II, L.L.C.

K. HOVNANIAN AT HACKETTSTOWN, INC.

K. HOVNANIAN AT HAMBURG CONTRACTORS, L.L.C.

K. HOVNANIAN AT HAMBURG, L.L.C.

K. HOVNANIAN AT HAWTHORNE, L.L.C

K. HOVNANIAN AT HAZLET, L.L.C.

K. HOVNANIAN AT HERSHEY’S MILL, INC.

K. HOVNANIAN AT HIGHLAND SHORES, L.L.C.

K. HOVNANIAN AT HIGHLAND VINEYARDS, INC.

K. HOVNANIAN AT HIGHWATER, L.L.C.

K. HOVNANIAN AT HILLTOP, L.L.C.

K. HOVNANIAN AT HOPEWELL IV, INC.

K. HOVNANIAN AT HOPEWELL VI, INC.

K. HOVNANIAN AT HOWELL TOWNSHIP, INC.

K. HOVNANIAN AT HUDSON POINTE, L.L.C.

K. HOVNANIAN AT JACKSON I, L.L.C.

K. HOVNANIAN AT JACKSON, L.L.C.

K. HOVNANIAN AT JERSEY CITY IV, L.L.C.

K. HOVNANIAN AT JERSEY CITY V URBAN RENEWAL COMPANY, L.L.C.

K. HOVNANIAN AT KEYPORT, L.L.C.

K. HOVNANIAN AT KING FARM, L.L.C.

K. HOVNANIAN AT KINGS GRANT I, INC.

K. HOVNANIAN AT LA COSTA GREENS, L.L.C.

K. HOVNANIAN AT LA COSTA, LLC

K. HOVNANIAN AT LA HABRA KNOLLS, LLC

K. HOVNANIAN AT LA TERRAZA, INC.

K. HOVNANIAN AT LAFAYETTE ESTATES, L.L.C.

K. HOVNANIAN AT LAKE HILLS, L.L.C.

K. HOVNANIAN AT LAKE RANCHO VIEJO, LLC

K. HOVNANIAN AT LAKE RIDGE CROSSING, L.L.C.

K. HOVNANIAN AT LAKE TERRAPIN, L.L.C.

K. HOVNANIAN AT LAKEWOOD, INC.

K. HOVNANIAN AT LAWRENCE V, L.L.C.

K. HOVNANIAN AT LINWOOD, L.L.C.

K. HOVNANIAN AT LITTLE EGG HARBOR CONTRACTORS, L.L.C.

K. HOVNANIAN AT LITTLE EGG HARBOR III, L.L.C.

K. HOVNANIAN AT LITTLE EGG HARBOR TOWNSHIP II, L.L.C.

K. HOVNANIAN AT LITTLE EGG HARBOR, L.L.C.

K. HOVNANIAN AT LONG BRANCH I, L.L.C.

K. HOVNANIAN AT LOWER MACUNGIE TOWNSHIP I, L.L.C.

K. HOVNANIAN AT LOWER MACUNGIE TOWNSHIP II, L.L.C.

K. HOVNANIAN AT LOWER MAKEFIELD TOWNSHIP I, L.L.C.

K. HOVNANIAN AT LOWER MORELAND I, L.L.C.

K. HOVNANIAN AT LOWER MORELAND II, L.L.C.

K. HOVNANIAN AT LOWER MORELAND III, L.L.C.

K. HOVNANIAN AT LOWER SAUCON, INC.

K. HOVNANIAN AT MACUNGIE, L.L.C.

K. HOVNANIAN AT MAHWAH II, INC.

K. HOVNANIAN AT MAHWAH VI, INC.

K. HOVNANIAN AT MAHWAH VII, INC.

K. HOVNANIAN AT MANALAPAN III, L.L.C.

K. HOVNANIAN AT MANALAPAN, INC.

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K. HOVNANIAN AT MANSFIELD I, L.L.C.

K. HOVNANIAN AT MANSFIELD II, L.L.C.

K. HOVNANIAN AT MANSFIELD III, L.L.C.

K. HOVNANIAN AT MAPLE AVENUE, L.L.C.

K. HOVNANIAN AT MARLBORO II, INC.

K. HOVNANIAN AT MARLBORO TOWNSHIP III, INC.

K. HOVNANIAN AT MARLBORO TOWNSHIP IV, INC.

K. HOVNANIAN AT MARLBORO TOWNSHIP IX, L.L.C.

K. HOVNANIAN AT MARLBORO TOWNSHIP V, L.L.C.

K. HOVNANIAN AT MARLBORO TOWNSHIP VIII, L.L.C.

K. HOVNANIAN AT MARLBORO VI, L.L.C.

K. HOVNANIAN AT MARLBORO VII, L.L.C.

K. HOVNANIAN AT MATSU, L.L.C.

K. HOVNANIAN AT MENDHAM TOWNSHIP, L.L.C.

K. HOVNANIAN AT MENIFEE VALLEY CONDOMINIUMS, L.L.C.

K. HOVNANIAN AT MENIFEE, L.L.C.

K. HOVNANIAN AT MIDDLE TOWNSHIP II, L.L.C.

K. HOVNANIAN AT MIDDLE TOWNSHIP, L.L.C.

K. HOVNANIAN AT MIDDLETOWN II, L.L.C.

K. HOVNANIAN AT MIDDLETOWN, L.L.C.

K. HOVNANIAN AT MILLVILLE I, L.L.C.

K. HOVNANIAN AT MILLVILLE II, L.L.C.

K. HOVNANIAN AT MILLVILLE III, L.L.C.

K. HOVNANIAN AT MOCKINGBIRD CANYON, L.L.C.

K. HOVNANIAN AT MONROE II, INC.

K. HOVNANIAN AT MONROE III, L.L.C.

K. HOVNANIAN AT MONROE IV, L.L.C.

K. HOVNANIAN AT MONROE NJ, L.L.C.

K. HOVNANIAN AT MONTGOMERY I, INC.

K. HOVNANIAN AT MONTVALE, L.L.C.

K. HOVNANIAN AT MOSAIC, LLC

K. HOVNANIAN AT MT. OLIVE TOWNSHIP, L.L.C.

K. HOVNANIAN AT NEW BRUNSWICK URBAN RENEWAL, L.L.C.

K. HOVNANIAN AT NEW WINDSOR, L.L.C.

K. HOVNANIAN AT NORTH BERGEN, L.L.C.

K. HOVNANIAN AT NORTH BRUNSWICK VI, L.L.C.

K. HOVNANIAN AT NORTH CALDWELL II, L.L.C.

K. HOVNANIAN AT NORTH CALDWELL III, L.L.C.

K. HOVNANIAN AT NORTH CALDWELL, L.L.C.

K. HOVNANIAN AT NORTH HALEDON, L.L.C.

K. HOVNANIAN AT NORTH WILDWOOD, L.L.C.

K. HOVNANIAN AT NORTHAMPTON, L.L.C.

K. HOVNANIAN AT NORTHERN WESTCHESTER, INC.

K. HOVNANIAN AT NORTHFIELD, L.L.C.

K. HOVNANIAN AT NORTHLAKE, INC.

K. HOVNANIAN AT OCEAN TOWNSHIP, INC.

K. HOVNANIAN AT OCEAN WALK, INC.

K. HOVNANIAN AT OCEANPORT, L.L.C.

K. HOVNANIAN AT OLD BRIDGE, L.L.C.

K. HOVNANIAN AT OLDE ORCHARD, LLC

K. HOVNANIAN AT ORANGE HEIGHTS, L.L.C.

K. HOVNANIAN AT PACIFIC BLUFFS, LLC

K. HOVNANIAN AT PARAMUS, L.L.C.

K. HOVNANIAN AT PARK LANE, LLC

Sch. A-4 

 

K. HOVNANIAN AT PARSIPPANY-TROY HILLS, L.L.C.

K. HOVNANIAN AT PEAPACK-GLADSTONE, L.L.C.

K. HOVNANIAN AT PERKIOMEN I, INC.

K. HOVNANIAN AT PERKIOMEN II, INC.

K. HOVNANIAN AT PHILADELPHIA II, L.L.C.

K. HOVNANIAN AT PHILADELPHIA III, L.L.C.

K. HOVNANIAN AT PHILADELPHIA IV, L.L.C.

K. HOVNANIAN AT PIAZZA D’ORO, L.L.C.

K. HOVNANIAN AT PITTSGROVE, L.L.C.

K. HOVNANIAN AT PORT IMPERIAL URBAN RENEWAL IV, L.L.C.

K. HOVNANIAN AT PORT IMPERIAL URBAN RENEWAL V, L.L.C.

K. HOVNANIAN AT PORT IMPERIAL URBAN RENEWAL VI, L.L.C.

K. HOVNANIAN AT PORT IMPERIAL URBAN RENEWAL VII, L.L.C.

K. HOVNANIAN AT PORT IMPERIAL URBAN RENEWAL VIII, L.L.C.

K. HOVNANIAN AT PRADO, L.L.C.

K. HOVNANIAN AT PRINCETON LANDING, L.L.C.

K. HOVNANIAN AT PRINCETON NJ, L.L.C.

K. HOVNANIAN AT RANCHO CRISTIANITOS, INC.

K. HOVNANIAN AT RANCHO SANTA MARGARITA, LLC

K. HOVNANIAN AT RANDOLPH I, L.L.C.

K. HOVNANIAN AT RAPHO, L.L.C.

K. HOVNANIAN AT READINGTON II, L.L.C.

K. HOVNANIAN AT RED BANK, L.L.C.

K. HOVNANIAN AT RESERVOIR RIDGE, INC.

K. HOVNANIAN AT RIDGEMONT, L.L.C.

K. HOVNANIAN AT RIDGESTONE, L.L.C.

K. HOVNANIAN AT RIVERBEND, LLC

K. HOVNANIAN AT RODERUCK, L.L.C.

K. HOVNANIAN AT ROSEMARY LANTANA, L.L.C.

K. HOVNANIAN AT ROWLAND HEIGHTS, LLC

K. HOVNANIAN AT SAGE, L.L.C.

K. HOVNANIAN AT SAN SEVAINE, INC.

K. HOVNANIAN AT SARATOGA, INC.

K. HOVNANIAN AT SAWMILL, INC.

K. HOVNANIAN AT SAYREVILLE, L.L.C.

K. HOVNANIAN AT SCOTCH PLAINS II, INC.

K. HOVNANIAN AT SCOTCH PLAINS, L.L.C.

K. HOVNANIAN AT SILVER SPRING, L.L.C.

K. HOVNANIAN AT SKYE ISLE, LLC

K. HOVNANIAN AT SMITHVILLE III, L.L.C.

K. HOVNANIAN AT SMITHVILLE, INC.

K. HOVNANIAN AT SOMERS POINT, L.L.C.

K. HOVNANIAN AT SOUTH BRUNSWICK V, INC.

K. HOVNANIAN AT SOUTH BRUNSWICK, L.L.C.

K. HOVNANIAN AT SPARTA, L.L.C.

K. HOVNANIAN AT SPRINGCO, L.L.C.

K. HOVNANIAN AT STONE CANYON, INC.

K. HOVNANIAN AT STONY POINT, INC.

K. HOVNANIAN AT SUNSETS, LLC

K. HOVNANIAN AT SYCAMORE, INC.

K. HOVNANIAN AT TANNERY HILL, INC.

K. HOVNANIAN AT TEANECK, L.L.C.

K. HOVNANIAN AT THE BLUFF, INC.

K. HOVNANIAN AT THE CROSBY, LLC

Sch. A-5 

 

K. HOVNANIAN AT THE GABLES, LLC

K. HOVNANIAN AT THE MONARCH, L.L.C.

K. HOVNANIAN AT THE PRESERVE, L.L.C.

K. HOVNANIAN AT THOMPSON RANCH, LLC

K. HOVNANIAN AT THORNBURY, INC.

K. HOVNANIAN AT TIERRASANTA, INC.

K. HOVNANIAN AT TRAIL RIDGE, LLC

K. HOVNANIAN AT TRENTON, L.L.C.

K. HOVNANIAN AT TROVATA, INC.

K. HOVNANIAN AT TUXEDO, INC.

K. HOVNANIAN AT UNION TOWNSHIP I, INC.

K. HOVNANIAN AT UNION TOWNSHIP II, L.L.C.

K. HOVNANIAN AT UPPER FREEHOLD TOWNSHIP I, INC.

K. HOVNANIAN AT UPPER FREEHOLD TOWNSHIP II, L.L.C.

K. HOVNANIAN AT UPPER FREEHOLD TOWNSHIP III, L.L.C.

K. HOVNANIAN AT UPPER MAKEFIELD I, INC.

K. HOVNANIAN AT UPPER UWCHLAN II, L.L.C.

K. HOVNANIAN AT UPPER UWCHLAN, L.L.C.

K. HOVNANIAN AT VAIL RANCH, INC.

K. HOVNANIAN AT VERONA URBAN RENEWAL, L.L.C.

K. HOVNANIAN AT VINELAND, L.L.C.

K. HOVNANIAN AT WALL TOWNSHIP VI, INC.

K. HOVNANIAN AT WALL TOWNSHIP VIII, INC.

K. HOVNANIAN AT WANAQUE, L.L.C.

K. HOVNANIAN AT WARREN TOWNSHIP, L.L.C.

K. HOVNANIAN AT WASHINGTON, L.L.C.

K. HOVNANIAN AT WASHINGTONVILLE, INC.

K. HOVNANIAN AT WAYNE III, INC.

K. HOVNANIAN AT WAYNE IX, L.L.C.

K. HOVNANIAN AT WAYNE V, INC.

K. HOVNANIAN AT WAYNE VIII, L.L.C.

K. HOVNANIAN AT WEST BRADFORD, L.L.C.

K. HOVNANIAN AT WEST MILFORD, L.L.C.

K. HOVNANIAN AT WEST WINDSOR, L.L.C.

K. HOVNANIAN AT WILDROSE, INC.

K. HOVNANIAN AT WILDWOOD BAYSIDE, L.L.C.

K. HOVNANIAN AT WILLOW BROOK, L.L.C.

K. HOVNANIAN AT WINCHESTER, LLC

K. HOVNANIAN AT WOODHILL ESTATES, L.L.C.

K. HOVNANIAN AT WOOLWICH I, L.L.C.

K. HOVNANIAN CAMBRIDGE HOMES, L.L.C.

K. HOVNANIAN CENTRAL ACQUISITIONS, L.L.C.

K. HOVNANIAN CHESTERFIELD INVESTMENT, L.L.C.

K. HOVNANIAN CLASSICS CIP, L.L.C.

K. HOVNANIAN CLASSICS, L.L.C.

K. HOVNANIAN COMMUNITIES, INC.

K. HOVNANIAN COMPANIES METRO D.C. NORTH, L.L.C.

K. HOVNANIAN COMPANIES NORTHEAST, INC.

K. HOVNANIAN COMPANIES OF CALIFORNIA, INC.

K. HOVNANIAN COMPANIES OF MARYLAND, INC.

K. HOVNANIAN COMPANIES OF NEW YORK, INC.

K. HOVNANIAN COMPANIES OF PENNSYLVANIA, INC.

K. HOVNANIAN COMPANIES OF SOUTHERN CALIFORNIA, INC.

K. HOVNANIAN COMPANIES OF VIRGINIA, INC.

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K. HOVNANIAN COMPANIES, LLC

K. HOVNANIAN CONNECTICUT ACQUISITIONS, L.L.C.

K. HOVNANIAN CONSTRUCTION II, INC

K. HOVNANIAN CONSTRUCTION III, INC

K. HOVNANIAN CONSTRUCTION MANAGEMENT, INC.

K. HOVNANIAN CRAFTBUILT HOMES OF SOUTH CAROLINA, L.L.C.

K. HOVNANIAN DELAWARE ACQUISITIONS, L.L.C.

K. HOVNANIAN DEVELOPMENTS OF ARIZONA, INC.

K. HOVNANIAN DEVELOPMENTS OF CALIFORNIA, INC.

K. HOVNANIAN DEVELOPMENTS OF CONNECTICUT, INC.

K. HOVNANIAN DEVELOPMENTS OF D.C., INC.

K. HOVNANIAN DEVELOPMENTS OF DELAWARE, INC.

K. HOVNANIAN DEVELOPMENTS OF GEORGIA, INC.

K. HOVNANIAN DEVELOPMENTS OF ILLINOIS, INC.

K. HOVNANIAN DEVELOPMENTS OF INDIANA, INC.

K. HOVNANIAN DEVELOPMENTS OF KENTUCKY, INC.

K. HOVNANIAN DEVELOPMENTS OF MARYLAND, INC.

K. HOVNANIAN DEVELOPMENTS OF MICHIGAN, INC.

K. HOVNANIAN DEVELOPMENTS OF MINNESOTA, INC.

K. HOVNANIAN DEVELOPMENTS OF NEW JERSEY II, INC.

K. HOVNANIAN DEVELOPMENTS OF NEW JERSEY, INC.

K. HOVNANIAN DEVELOPMENTS OF NEW YORK, INC.

K. HOVNANIAN DEVELOPMENTS OF NORTH CAROLINA, INC.

K. HOVNANIAN DEVELOPMENTS OF OHIO, INC.

K. HOVNANIAN DEVELOPMENTS OF PENNSYLVANIA, INC.

K. HOVNANIAN DEVELOPMENTS OF SOUTH CAROLINA, INC.

K. HOVNANIAN DEVELOPMENTS OF TEXAS, INC.

K. HOVNANIAN DEVELOPMENTS OF VIRGINIA, INC.

K. HOVNANIAN DEVELOPMENTS OF WEST VIRGINIA, INC.

K. HOVNANIAN EASTERN PENNSYLVANIA, L.L.C.

K. HOVNANIAN FIRST HOMES, L.L.C.

K. HOVNANIAN FLORIDA REALTY, L.L.C.

K. HOVNANIAN FORECAST HOMES NORTHERN, INC.

K. HOVNANIAN FOUR SEASONS @ HISTORIC VIRGINIA, LLC

K. HOVNANIAN FOUR SEASONS AT GOLD HILL, LLC

K. HOVNANIAN GREAT WESTERN BUILDING COMPANY, LLC

K. HOVNANIAN GREAT WESTERN HOMES, LLC

K. HOVNANIAN HOLDINGS NJ, L.L.C.

K. HOVNANIAN HOMES — DFW, L.L.C.

K. HOVNANIAN HOMES AT BELMONT OVERLOOK, L.L.C.

K. HOVNANIAN HOMES AT CAMERON STATION, LLC

K. HOVNANIAN HOMES AT CAMP SPRINGS, L.L.C.

K. HOVNANIAN HOMES AT CIDER MILL, L.L.C.

K. HOVNANIAN HOMES AT FAIRWOOD, L.L.C.

K. HOVNANIAN HOMES AT FOREST RUN, L.L.C.

K. HOVNANIAN HOMES AT GREENWAY FARM PARK TOWNS, L.L.C.

K. HOVNANIAN HOMES AT GREENWAY FARM, L.L.C.

K. HOVNANIAN HOMES AT JONES STATION 1, L.L.C.

K. HOVNANIAN HOMES AT JONES STATION 2, L.L.C.

K. HOVNANIAN HOMES AT MAXWELL PLACE. L.L.C.

K. HOVNANIAN HOMES AT NASSAU GROVE, L.L.C.

K. HOVNANIAN HOMES AT PAYNE STREET, L.L.C.

K. HOVNANIAN HOMES AT PRIMERA, L.L.C.

K. HOVNANIAN HOMES AT RENAISSANCE PLAZA, L.L.C.

Sch. A-7 

 

K. HOVNANIAN HOMES AT RUSSETT, L.L.C.

K. HOVNANIAN HOMES AT VICTORIA STATION, L.L.C.

K. HOVNANIAN HOMES OF D.C., L.L.C.

K. HOVNANIAN HOMES OF DELAWARE, L.L.C.

K. HOVNANIAN HOMES OF GEORGIA, L.L.C.

K. HOVNANIAN HOMES OF HOUSTON, L.L.C.

K. HOVNANIAN HOMES OF INDIANA, L.L.C.

K. HOVNANIAN HOMES OF MARYLAND, L.L.C.

K. HOVNANIAN HOMES OF MINNESOTA, L.L.C.

K. HOVNANIAN HOMES OF NORTH CAROLINA, INC.

K. HOVNANIAN HOMES OF PENNSYLVANIA, L.L.C.

K. HOVNANIAN HOMES OF SOUTH CAROLINA, LLC

K. HOVNANIAN HOMES OF VIRGINIA, INC.

K. HOVNANIAN HOMES OF WEST VIRGINIA, L.L.C.

K. HOVNANIAN INTERNATIONAL, L.L.C.

K. HOVNANIAN NORTH CENTRAL ACQUISITIONS, L.L.C.

K. HOVNANIAN NORTH JERSEY ACQUISITIONS, L.L.C.

K. HOVNANIAN NORTHEAST SERVICES, L.L.C.

K. HOVNANIAN OF HOUSTON II, L.L.C.

K. HOVNANIAN OHIO REALTY, L.L.C.

K. HOVNANIAN OSTER HOMES, L.L.C.

K. HOVNANIAN PA REAL ESTATE, INC.

K. HOVNANIAN PENNSYLVANIA ACQUISITIONS, L.L.C.

K. HOVNANIAN PORT IMPERIAL URBAN RENEWAL, INC.

K. HOVNANIAN PROPERTIES OF RED BANK, INC.

K. HOVNANIAN SHORE ACQUISITIONS, L.L.C.

K. HOVNANIAN SOUTH JERSEY ACQUISITIONS, L.L.C.

K. HOVNANIAN SOUTHERN NEW JERSEY, L.L.C.

K. HOVNANIAN STANDING ENTITY, L.L.C.

K. HOVNANIAN SUMMIT HOLDINGS, L.L.C.

K. HOVNANIAN SUMMIT HOMES OF KENTUCKY, L.L.C.

K. HOVNANIAN SUMMIT HOMES OF MICHIGAN, L.L.C.

K. HOVNANIAN SUMMIT HOMES OF PENNSYLVANIA, L.L.C.

K. HOVNANIAN SUMMIT HOMES OF WEST VIRGINIA, L.L.C.

K. HOVNANIAN SUMMIT HOMES, L.L.C.

K. HOVNANIAN T&C HOMES AT FLORIDA, L.L.C.

K. HOVNANIAN T&C HOMES AT ILLINOIS, L.L.C.

K. HOVNANIAN T&C HOMES AT MINNESOTA, L.L.C.

K. HOVNANIAN T&C INVESTMENT, L.L.C.

K. HOVNANIAN T&C MANAGEMENT CO., L.L.C.

K. HOVNANIAN VENTURE I, L.L.C.

K. HOVNANIAN WINDWARD HOMES, LLC

K. HOVNANIAN’S FOUR SEASONS AT ASHBURN VILLAGE, L.L.C.

K. HOVNANIAN’S FOUR SEASONS AT BAILEY’S GLENN, L.L.C.

K. HOVNANIAN’S FOUR SEASONS AT BAKERSFIELD, L.L.C.

K. HOVNANIAN’S FOUR SEASONS AT BEAUMONT, LLC

K. HOVNANIAN’S FOUR SEASONS AT CHARLOTTESVILLE, L.L.C.

K. HOVNANIAN’S FOUR SEASONS AT DULLES DISCOVERY CONDOMINIUM, L.L.C.

K. HOVNANIAN’S FOUR SEASONS AT DULLES DISCOVERY, L.L.C.

K. HOVNANIAN’S FOUR SEASONS AT HAMPTONBURGH, L.L.C.

K. HOVNANIAN’S FOUR SEASONS AT HEMET, LLC

K. HOVNANIAN’S FOUR SEASONS AT HUNTFIELD, L.L.C.

K. HOVNANIAN’S FOUR SEASONS AT KENT ISLAND CONDOMINIUMS, L.L.C.

K. HOVNANIAN’S FOUR SEASONS AT KENT ISLAND, L.L.C.

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K. HOVNANIAN’S FOUR SEASONS AT MENIFEE VALLEY, L.L.C.

K. HOVNANIAN’S FOUR SEASONS AT NEW KENT VINEYARDS, L.L.C.

K. HOVNANIAN’S FOUR SEASONS AT PALM SPRINGS, LLC

K. HOVNANIAN’S FOUR SEASONS AT RENAISSANCE, L.L.C.

K. HOVNANIAN’S FOUR SEASONS AT RUSH CREEK, L.L.C.

K. HOVNANIAN’S FOUR SEASONS AT ST. MARGARETS LANDING, L.L.C.

K. HOVNANIAN’S FOUR SEASONS AT VINT HILL, L.L.C.

K. HOVNANIAN’S FOUR SEASONS, LLC

K. HOVNANIAN’S PARKSIDE AT TOWNGATE, L.L.C.

K. HOVNANIAN’S PRIVATE HOME PORTFOLIO, L.L.C.

KHIP, L.L.C.

LANDARAMA, INC.

M & M AT KENSINGTON WOODS, L.L.C.

M & M AT LONG BRANCH, INC

M&M AT APPLE RIDGE, L.L.C.

M&M AT CHESTERFIELD, L.L.C.

M&M AT COPPER BEECH, L.L.C.

M&M AT CRESCENT COURT, L.L.C.

M&M AT EAST MILL, L.L.C.

M&M AT EAST RUTHERFORD, L.L.C.

M&M AT MORRISTOWN, L.L.C.

M&M AT SHERIDAN, L.L.C.

M&M AT SPINNAKER POINTE, L.L.C.

M&M AT SPRUCE HOLLOW, L.L.C.

M&M AT SPRUCE RUN, L.L.C.

M&M AT STATION SQUARE, L.L.C.

M&M AT TAMARACK HOLLOW, L.L.C.

M&M AT THE CHATEAU, L.L.C.

M&M AT THE HIGHLANDS, L.L.C.

M&M AT UNION, L.L.C.

M&M AT WEST ORANGE, L.L.C.

M&M AT WESTPORT, L.L.C.

M&M AT WHEATENA URBAN RENEWAL, L.L.C.

M&M INVESTMENTS, L.P.

MATZEL & MUMFORD AT EGG HARBOR, L.L.C.

MATZEL & MUMFORD AT MONTGOMERY, L.L.C.

MATZEL & MUMFORD AT SOUTH BOUND BROOK URBAN RENEWAL, L.L.C.

MCNJ, INC.

MIDWEST BUILDING PRODUCTS & CONTRACTOR SERVICES OF KENTUCKY, L.L.C.

MIDWEST BUILDING PRODUCTS & CONTRACTOR SERVICES OF MICHIGAN, L.L.C.

MIDWEST BUILDING PRODUCTS & CONTRACTOR SERVICES OF PENNSYLVANIA, L.L.C.

MIDWEST BUILDING PRODUCTS & CONTRACTOR SERVICES OF WEST VIRGINIA, L.L.C.

MIDWEST BUILDING PRODUCTS & CONTRACTOR SERVICES, L.L.C.

MMIP, L.L.C.

NATOMAS CENTRAL NEIGHBORHOOD HOUSING, L.L.C.

NEW LAND TITLE AGENCY, L.L.C.

PADDOCKS, L.L.C.

PARK TITLE COMPANY, LLC

PINE AYR, LLC

RIDGEMORE UTILITY ASSOCIATES OF PENNSYLVANIA, L.L.C.

RIDGEMORE UTILITY L.L.C.

SEABROOK ACCUMULATION CORPORATION

STONEBROOK HOMES, INC.

TERRAPIN REALTY, L.L.C.

Sch. A-9 

 

THE LANDINGS AT SPINNAKER POINTE, L.L.C.

THE MATZEL & MUMFORD ORGANIZATION, INC

WASHINGTON HOMES AT COLUMBIA TOWN CENTER, L.L.C.

WASHINGTON HOMES, INC.

WESTMINSTER HOMES OF ALABAMA, L.L.C.

WESTMINSTER HOMES OF MISSISSIPPI, LLC

WESTMINSTER HOMES OF TENNESSEE, INC.

WESTMINSTER HOMES, INC.

WH LAND I, INC

WH PROPERTIES, INC.

WH/PR LAND COMPANY, L.L.C.

WOODLAND LAKE CONDOMINIUMS AT BOWIE NEW TOWN, L.L.C.

Sch. A-10 

 

EXHIBIT A

[FACE OF NOTE]

K. HOVNANIAN ENTERPRISES, INC.

18.0% Senior Secured Notes Due 2017

CUSIP No.:

			
	 	 	 
	No.
	 	$                    

     K. Hovnanian Enterprises, Inc., a California corporation (the “Issuer,” which term includes
any successor under the Indenture hereinafter referred to), for value received, promises to pay to
                    , or its registered assigns, the principal sum of                      DOLLARS
($                    ), [or such other amount as is provided in a schedule attached hereto]1, on May
1, 2017.

     Interest Rate: 18.0% per annum.

     Interest Payment Dates: May 1 and November 1, commencing May 1, 2009.

     Record Dates: April 15 and October 15.

     Reference is hereby made to the further provisions of this Note set forth on the reverse
hereof, which will for all purposes have the same effect as if set forth at this place.

 

			
	1	 	For Global Notes.

A-1

 

     IN WITNESS WHEREOF, the Issuer has caused this Note to be signed manually or by facsimile by
its duly authorized officer.

     Dated: [                    ], 2008

	 	 	 	 	 
	 	K. HOVNANIAN ENTERPRISES, INC.

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 

A-2

 

	 	 	 	 	 

[Form of] Trustee’s Certificate of Authentication

     This is one of the 18.0% Senior Secured Notes Due 2017 described in the Indenture referred to
in this Note.

	 	 	 	 	 
	 	WILMINGTON TRUST COMPANY,

      as Trustee

 	 
	 	By:  	 	 
	 	 	Authorized Signatory 	 
	 	 	 	 

A-3

 

	 	 	 	 	 

[REVERSE SIDE OF NOTE]

K. HOVNANIAN ENTERPRISES, INC.

18.0% Senior Secured Notes Due 2017

     Capitalized terms used herein are used as defined in the Indenture referred to below unless
otherwise indicated.

1. Principal and Interest.

     K. Hovnanian Enterprises, Inc. (the “Issuer,” which term includes any successor under the
Indenture hereinafter referred to), a California corporation, promises to pay the principal of this
Note on May 1, 2017.

     The Issuer promises to pay interest on the principal amount of this Note on each interest
payment date, as set forth on the face of this Note, at the rate of 18.0% per annum.

     Interest will be payable semiannually (to the holders of record of the Notes at the close of
business on the April 15 or October 15 immediately preceding the interest payment date) on each
interest payment date, commencing May 1, 2009.

     [The Holder of this Note is entitled to the benefits of the Registration Rights Agreement,
dated [                    ], 2008, among the Issuer, the Guarantors party thereto and the [Initial
Purchasers][Dealer Managers] named therein (the “Registration Rights Agreement”). In the event of
a Registration Default (as defined in the Registration Rights Agreement), the Holder shall be
entitled to Additional Interest as specified in the Registration Rights Agreement until the
Registration Default is cured.]2

     Interest on this Note will accrue from the most recent date to which interest has been paid on
this Note or the Note surrendered in exchange for this Note (or, if there is no existing default in
the payment of interest and if this Note is authenticated between a regular record date and the
next interest payment date, from such interest payment date) or, if no interest has been paid, from
[                    ], 2008. Interest will be computed on the basis of a 360-day year of twelve 30-day
months.

2. Paying Agent and Registrar.

     Initially, Wilmington Trust Company (the “Trustee”) will act as Paying Agent and Registrar.
The Issuer may change or appoint any Paying Agent, Registrar or co-Registrar without notice to any
Holder. The Issuer or any of its Subsidiaries may act as Paying Agent, Registrar or co-Registrar.

 

			
	2	 	For Initial Notes and Initial Additional Notes only.

A-4

 

3. Indenture; Guarantees.

     This is one of the Notes issued under an Indenture dated as of [                    ], 2008 (as amended
from time to time, the “Indenture”), among the Issuer, the Guarantors party thereto and the
Trustee. The terms of the Notes include those stated in the Indenture and those made part of the
Indenture by reference to the Trust Indenture Act. The Notes are subject to all such terms, and
Holders are referred to the Indenture and the Trust Indenture Act for a statement of all such
terms. To the extent permitted by applicable law, in the event of any inconsistency between the
terms of this Note and the terms of the Indenture, the terms of the Indenture will control.

     The Notes are general obligations of the Issuer, secured by Liens on the Collateral as
described in the Indenture. The Indenture limits the original aggregate principal amount of the
Notes issued thereunder to $29,299,000 but Additional Notes may be issued pursuant to the Indenture
(subject to the conditions stated therein), and the originally issued Notes and all such Additional
Notes vote together for all purposes as a single class. This Note is guaranteed by the Guarantors
as set forth in the Indenture and the Guarantee endorsed hereon.

     Reference is hereby made to the Indenture for a statement of the respective rights, duties and
obligations thereunder of the Issuer, the Guarantors, the Trustee and the Holders.

4. Optional Redemption; Redemption with Proceeds of Equity Offering.

     At any time and from time to time on or after May 1, 2011, the Issuer may redeem the Notes, in
whole or in part, at a redemption price equal to the percentage of principal amount set forth below
plus accrued and unpaid interest and Additional Interest thereon, if any, to the applicable
redemption date.

	 	 	 	 	 
	Year	 	Percentage
	May 1, 2011
	 	 	102	%
	November 1, 2011
	 	 	101	%
	November 1, 2012
	 	 	100	%

     At any time and from time to time prior to May 1, 2011, the Issuer may redeem Notes with the
net cash proceeds received by the Issuer from any Equity Offering at a redemption price equal to
118.0% of the principal amount plus accrued and unpaid interest to the redemption date, in an
aggregate principal amount for all such redemptions not to exceed 35% of the original aggregate
principal amount of the Notes, provided that:

(i) in each case the redemption takes place not later than 60 days after the closing of the related
Equity Offering, and

A-5

 

(ii) not less than 65% of the original aggregate principal amount of the Notes remains outstanding
immediately thereafter.

     If less than all of the Notes are to be redeemed at any time, the Trustee will select Notes
for redemption on a pro rata basis, by lot or by such other method as the Trustee in its sole
discretion shall deem appropriate and fair.

     No Notes of $2,000 in original principal amount or less shall be redeemed in part. Notices of
redemption may not be conditional.

     If any Note is to be redeemed in part only, the notice of redemption that relates to that Note
shall state the portion of the principal amount thereof to be redeemed. A new Note in principal
amount equal to the unredeemed portion of the original Note will be issued in the name of the
Holder thereof upon cancellation of the original Note. Notes called for redemption become due on
the date fixed for redemption. On and after the redemption date, interest ceases to accrue on
Notes or portions thereof called for redemption.

5. Repurchase Provisions.

     If a Change of Control occurs, each Holder shall have the right, at such Holder’s option, to
require the Issuer to purchase all or any part (equal to $2,000 principal amount or any multiple of
$1,000 in excess thereof (or multiples of $1.00 principal amount in excess of $2,000 or any
multiple of $1,000 if the Issuer has elected to issue Notes in such denomination as described in
the Indenture) of such Holder’s Notes on a date that is no later than 90 days after notice of the
Change of Control, at a purchase price equal to 101% of the principal amount thereof, plus accrued
and unpaid interest and Additional Interest, if any, to the date of repurchase as provided in, and
subject to the terms of, the Indenture.

6. Mandatory Redemption.

     There is no sinking fund for, or mandatory redemption of, the Notes.

7. Discharge and Defeasance.

     If the Issuer deposits with the Trustee money and/or U.S. Government Obligations sufficient to
pay the then outstanding principal of, premium, interest and Additional Interest, if any, and
accrued interest on the Notes to redemption or maturity, as the case may be, the Issuer, the
Company and the Guarantors may in certain circumstances be discharged from the Indenture, the
Notes, the Guarantees and the Security Documents or may be discharged from certain of their
obligations under certain provisions of the Indenture.

A-6

 

8. Registered Form; Denominations; Transfer; Exchange.

     The Notes are in registered form only without coupons in denominations of $2,000 principal
amount and any multiple of $1,000 in excess thereof (or multiples of $1.00 in excess of $2,000 or
any multiple of $1,000 if the Issuer has elected to issue Notes in such denomination as described
in the Indenture). A Holder may register the transfer or exchange of Notes in accordance with the
Indenture. The Trustee may require a Holder, among other things, to furnish appropriate
endorsements and transfer documents and to pay any taxes and fees required by law or permitted by
the Indenture. Pursuant to the Indenture, there are certain periods during which the Trustee will
not be required to issue, register the transfer of, or exchange any Note or certain portions of a
Note.

9. Persons Deemed Owners.

     The registered Holder of this Note shall be treated as the owner of it for all purposes.

10. Defaults and Remedies.

     If an Event of Default occurs and is continuing, the Trustee or the Holders of at least 25% in
principal amount of the Notes may declare all the Notes to be due and payable immediately. If a
bankruptcy or insolvency default with respect to the Issuer or the Company occurs and is
continuing, the Notes automatically become immediately due and payable. Holders may not enforce
the Indenture or the Notes except as provided in the Indenture. The Trustee may require indemnity
satisfactory to it before it enforces the Indenture or the Notes. Subject to certain limitations,
Holders of a majority in principal amount of the Notes then outstanding may direct the Trustee in
its exercise of remedies.

11. Amendment, Supplement and Waiver.

     Subject to certain exceptions, the Indenture, the Notes, the Guarantees and the Security
Documents may be amended or supplemented, or future compliance therewith may be waived, with the
consent of the Holders of a majority in principal amount of the outstanding Notes. Without notice
to or the consent of any Holder, the Company, the Issuer, the Guarantors and the Trustee, and with
respect to the Security Documents, the Collateral Agent, the Administrative Agent, the Second Lien
Notes Collateral Agent, Second Lien Notes Trustee and the Mortgage Tax Collateral Agent (as
applicable) may amend or supplement the Indenture, the Notes, the Guarantees or the Security
Documents to, among other things, cure any ambiguity, defect or inconsistency or if such amendment
or supplement does not adversely affect the legal rights of any Holder.

12. Lien Subordination and Sharing.

     These Notes and the Guarantees are secured by Third-Priority Liens upon the Collateral
pursuant to certain Security Documents. The Third-Priority Liens upon any

A-7

 

and all Collateral are,
to the extent and in the manner provided in the Intercreditor Agreement, subordinate in ranking to
all present and future First-Priority Liens and
Second-Priority Liens as set forth in Article 10 of the Indenture and in the Intercreditor
Agreement.

13. Trustee Dealings With Issuer.

     The Trustee, in its individual or any other capacity, may become the owner or pledgee of Notes
and may otherwise deal with the Issuer or its affiliates, with the same rights as if it were not
Trustee; however, if it acquires any conflicting interest (as defined in the Trust Indenture Act),
it must eliminate such conflict, apply to the Commission for permission to continue or resign.

14. No Recourse Against Others.

     An incorporator, and any past, present or future director, officer, partner, employee or
stockholder, as such, of the Issuer, the Company or the Guarantors shall not have any liability for
any obligations of the Issuer, the Company or the Guarantors under the Notes, the Indenture or the
Guarantees or for any claim based on, in respect of, or by reason of, such obligations or their
creation. Each Holder by accepting a Note waives and releases all such liability. The waiver and
release are part of the consideration for the issue of the Notes.

15. Governing Law.

     THIS NOTE SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW
YORK.

16. CUSIP Numbers.

     Pursuant to a recommendation promulgated by the Committee on Uniform Note Identification
Procedures, the Issuer has caused CUSIP numbers to be printed on the Notes, and the Trustee may use
CUSIP numbers in notices as a convenience to Holders. No representation is made as to the accuracy
of such numbers either as printed on the Notes or as contained in any notice and reliance may be
placed only on the other identification numbers placed thereon.

17. Authentication.

     This Note is not valid until the Trustee (or Authenticating Agent) manually signs the
certificate of authentication on the other side of this Note.

18. Abbreviations.

     Customary abbreviations may be used in the name of a Holder or an assignee, such as: TEN COM
(= tenants in common), TEN ENT (= tenants by the entireties), JT

A-8

 

TEN (= joint tenants with right of
survivorship and not as tenants in common), CUST (= Custodian) and U/G/M/A/ (= Uniform Gifts to
Minors Act).

     The Issuer will furnish a copy of the Indenture to any Holder upon written request and without
charge.

A-9

 

[FORM OF TRANSFER NOTICE]

FOR VALUE RECEIVED the undersigned registered holder hereby sell(s), assign(s) and transfer(s) unto

Insert Social Security or Taxpayer Identification No.

 

 

Please print or typewrite name and address, including zip code, of assignee

 

 

the within Note and all rights thereunder, hereby irrevocably constituting and appointing

 

agent to transfer this Note on the books of the Issuer with full power of substitution in the
premises.

	 	 	 	 	 	 	 	 	 	 	 
	Dated:

	 	 	 	 	 	Signed:
	 	 	 	 
	 

	 	 
	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	(sign exactly as name appears on the
other side of this Note)	 	 

	 	 	 
	Signature Guarantee3:
	 	 
	 

	 	 

 

			
	3	 	Signatures must be guaranteed by an “eligible guarantor
institution” meeting the requirements of the Registrar, which requirements
include membership or participation in the Note Transfer Agent Medallion
Program (“STAMP”) or such other “signature guarantee program” as may be
determined by the Registrar in addition to, or in substitution for, STAMP, all
in accordance with the Securities Exchange Act of 1934, as amended.

A-10

 

[THE FOLLOWING PROVISION TO BE INCLUDED ON ALL CERTIFICATES

BEARING A RESTRICTED LEGEND]

     In connection with any transfer of this Note occurring prior to the date which is the date
following the first anniversary of the original issuance of this Note, the undersigned confirms
that such transfer is made without utilizing any general solicitation or general advertising in
connection with the transfer and further as follows:

Check One

o  (1) This Note is being transferred to a “qualified institutional buyer” in compliance with Rule
144A under the Securities Act of 1933, as amended, and certification in the form of Exhibit F to
the Indenture is being furnished herewith.

o (2) This Note is being transferred to a non-“U.S. Person,” as defined in Rule 902 of Regulation S
under the Securities Act in compliance with the exemption from registration under the Securities
Act of 1933, as amended, provided by Regulation S thereunder, and certification in the form of
Exhibit E to the Indenture is being furnished herewith.

or

o (3) This Note is being transferred other than in accordance with (1) or (2) above and documents
are being furnished herewith which comply with the conditions of transfer set forth in this Note
and the Indenture.

     If none of the foregoing boxes is checked, the Trustee is not obligated to register this Note
in the name of any Person other than the Holder hereof unless and until the conditions to any such
transfer of registration set forth herein and in the Indenture have been satisfied.

Dated:                                        

	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 	 	 	 	Transferor	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	Signed:	 	 	 	 
	 

	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	NOTICE: The signature to this assignment must correspond
with the name as written upon the face of the
within-mentioned instrument in every particular, without
alteration or any change whatsoever.	 	 

A-11

 

	 	 	 	 	 	 	 
	Signature Guarantee:4
	 	 	 	 	 	 
	 	 	 	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	 	 	 	 	 
	 	 	(To be executed by an executive officer)	 	 

 

			
	4	 	Signatures must be guaranteed by an “eligible guarantor
institution” meeting the requirements of the Registrar, which requirements
include membership or participation in the Note Transfer Agent Medallion
Program (“STAMP”) or such other “signature guarantee program” as may be
determined by the Registrar in addition to, or in substitution for, STAMP, all
in accordance with the Securities Exchange Act of 1934, as amended.

A-12

 

OPTION OF HOLDER TO ELECT PURCHASE

     If you wish to have all of this Note purchased by the Issuer pursuant to Section 4.10 or
Section 4.12 of the Indenture, check the box: o

     If you wish to have a portion of this Note purchased by the Issuer pursuant to Section 4.10 or
Section 4.12 of the Indenture, state the amount (in original principal amount) below:

          $                                        .

Date:                    

	 	 	 	 	 
	Your Signature:
	 	 	 	 
	 

	 	 

	 	 

(Sign exactly as your name appears on the other side of this Note)

	 	 	 	 	 
	Signature Guarantee:5
	 	 	 	 
	 

	 	 

	 	 

 

			
	5	 	Signatures must be guaranteed by an “eligible guarantor
institution” meeting the requirements of the Trustee, which requirements
include membership or participation in the Note Transfer Agent Medallion
Program (“STAMP”) or such other “signature guarantee program” as may be
determined by the Trustee in addition to, or in substitution for, STAMP, all in
accordance with the Securities Exchange Act of 1934, as amended.

A-13

 

SCHEDULE OF EXCHANGES OF INTERESTS IN GLOBAL NOTES6

     The following exchanges of a part of this Global Note for Certificated Notes or an interest in
another Global Note, or exchanges of a part of another Global Note or Certificated Note for an
interest in this Global Note, have been made:

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	Principal amount	 	 	 	 
	 	 	Amount of	 	 	Amount of	 	 	of this Global Note	 	 	 	 
	 	 	decrease in	 	 	increase in	 	 	following such	 	 	Signature of	 
	 	 	principal amount	 	 	principal amount	 	 	decrease or	 	 	authorized officer	 
	Date of Exchange	 	of this Global Note	 	 	of this Global Note	 	 	increase	 	 	of Trustee	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 

 

			
	6	 	For Global Notes

A-14

 

[FORM OF NOTATION ON NOTE RELATING TO GUARANTEE]

GUARANTEE

     The undersigned (the “Guarantors”) have unconditionally guaranteed, jointly and severally
(such guarantee by each Guarantor being referred to herein as the “Guarantee”) (i) the due and
punctual payment of the principal of and interest and Additional Interest, if any, on the Issuer’s
18.0% Senior Secured Notes due 2017 (the “Notes”), whether at maturity or on an interest payment
date, by acceleration or otherwise, on the Notes, to the extent lawful, and of all other
obligations of the Issuer to the Holders or the Trustee all in accordance with the terms set forth
in Article 6 of the Indenture and (ii) in case of any extension of time of payment or renewal of
any Notes or any of such other obligations, that the same will be promptly paid in full when due or
performed in accordance with the terms of the extension or renewal, whether at stated maturity, by
acceleration or otherwise.

     No past, present or future stockholder, officer, director, employee, partner or incorporator,
as such, of any of the Guarantors shall have any liability under the Guarantee evidenced hereby by
reason of such person’s status as stockholder, officer, director, employee, partner or
incorporator. Each Holder of a Note by accepting a Note waives and releases all such liability.
This waiver and release are part of the consideration for the issuance of the Guarantee.

     Each Holder of a Note by accepting a Note agrees that any Guarantor named below shall have no
further liability with respect to its Guarantee if such Guarantor otherwise ceases to be liable in
respect of its Guarantee in accordance with the terms of the Indenture.

     The Guarantee evidenced hereby shall not be valid or obligatory for any purpose until the
certificate of authentication on the Notes upon which the Guarantee is noted shall have been
executed by the Trustee under the Indenture by the manual signature of one of its authorized
officers.

     This Guarantee shall be governed by, and construed in accordance with, the laws of the State
of New York.

HOVNANIAN ENTERPRISES, INC.

ALFORD, L.L.C.

AUDDIE ENTERPRISES, L.L.C.

BUILDER SERVICES NJ, L.L.C.

BUILDER SERVICES NY, L.L.C.

BUILDER SERVICES PA, L.L.C.

DULLES COPPERMINE, L.L.C.

EASTERN TITLE AGENCY, INC.

F&W MECHANICAL SERVICES, L.L.C.

FOUNDERS TITLE AGENCY OF MARYLAND, L.L.C.

FOUNDERS TITLE AGENCY, INC.

GOVERNOR’S ABSTRACT CO., INC.

A-15

 

GREENWAY FARMS UTILITY ASSOCIATES, L.L.C.

HOMEBUYERS FINANCIAL SERVICES, L.L.C.

HOVNANIAN DEVELOPMENTS OF FLORIDA, INC.

HOVNANIAN LAND INVESTMENT GROUP OF CALIFORNIA, L.L.C.

HOVNANIAN LAND INVESTMENT GROUP OF FLORIDA, L.L.C.

HOVNANIAN LAND INVESTMENT GROUP OF GEORGIA, L.L.C.

HOVNANIAN LAND INVESTMENT GROUP OF MARYLAND, L.L.C.

HOVNANIAN LAND INVESTMENT GROUP OF NEW JERSEY, L.L.C.

HOVNANIAN LAND INVESTMENT GROUP OF NORTH CAROLINA, L.L.C.

HOVNANIAN LAND INVESTMENT GROUP OF PENNSYLVANIA, L.L.C.

HOVNANIAN LAND INVESTMENT GROUP OF TEXAS, L.L.C.

HOVNANIAN LAND INVESTMENT GROUP OF VIRGINIA, L.L.C.

HOVNANIAN LAND INVESTMENT GROUP, L.L.C.

K. H. SAN MARCOS CONSERVANCY HOLDINGS L.L.C.

K. HOV I P, INC.

K. HOV INTERNATIONAL, INC.

K. HOV IP, II, INC.

K. HOVNANIAN ACQUISITIONS, INC.

K. HOVNANIAN AT 3 CHAPMAN, L.L.C.

K. HOVNANIAN AT 4S, LLC

K. HOVNANIAN AT ABERDEEN URBAN RENEWAL, L.L.C.

K. HOVNANIAN AT ACQUA VISTA, LLC

K. HOVNANIAN AT ALISO, LLC

K. HOVNANIAN AT ALLENBERRY, L.L.C.

K. HOVNANIAN AT ALLENDALE, L.L.C.

K. HOVNANIAN AT ALLENTOWN, L.L.C.

K. HOVNANIAN AT ARBOR HEIGHTS, LLC

K. HOVNANIAN AT AVENUE ONE, L.L.C.

K. HOVNANIAN AT BARNEGAT I, L.L.C.

K. HOVNANIAN AT BARNEGAT II, L.L.C.

K. HOVNANIAN AT BARNEGAT III, L.L.C.

K. HOVNANIAN AT BELLA LAGO, LLC

K. HOVNANIAN AT BERKELEY, L.L.C.

K. HOVNANIAN AT BERNARDS IV, INC.

K. HOVNANIAN AT BERNARDS V, L.L.C.

K. HOVNANIAN AT BLUE HERON PINES, L.L.C.

K. HOVNANIAN AT BRANCHBURG III, INC.

K. HOVNANIAN AT BRIDGEPORT, INC.

K. HOVNANIAN AT BRIDGEWATER I, L.L.C.

K. HOVNANIAN AT BRIDGEWATER VI, INC.

K. HOVNANIAN AT BRIDLEWOOD, L.L.C.

K. HOVNANIAN AT BROAD AND WALNUT, L.L.C.

K. HOVNANIAN AT BURLINGTON III, INC.

K. HOVNANIAN AT BURLINGTON, INC.

K. HOVNANIAN AT CALABRIA, INC.

K. HOVNANIAN AT CAMDEN I, L.L.C.

K. HOVNANIAN AT CAMERON CHASE, INC.

K. HOVNANIAN AT CAMP HILL, L.L.C.

K. HOVNANIAN AT CAPISTRANO, L.L.C.

K. HOVNANIAN AT CARMEL DEL MAR, INC.

K. HOVNANIAN AT CARMEL VILLAGE, LLC

K. HOVNANIAN AT CASTILE, INC.

K. HOVNANIAN AT CEDAR GROVE III, L.L.C.

K. HOVNANIAN AT CEDAR GROVE IV, L.L.C.

A-16

 

K. HOVNANIAN AT CHAPARRAL, INC.

K. HOVNANIAN AT CHESTER I, L.L.C.

K. HOVNANIAN AT CHESTERFIELD II, L.L.C.

K. HOVNANIAN AT CHESTERFIELD, L.L.C.

K. HOVNANIAN AT CIELO, L.L.C.

K. HOVNANIAN AT CLARKSTOWN, INC.

K. HOVNANIAN AT CLIFTON II, L.L.C.

K. HOVNANIAN AT CLIFTON, L.L.C.

K. HOVNANIAN AT COASTLINE, L.L.C.

K. HOVNANIAN AT CORTEZ HILL, LLC

K. HOVNANIAN AT CRANBURY, L.L.C.

K. HOVNANIAN AT CRESTLINE, INC.

K. HOVNANIAN AT CURRIES WOODS, L.L.C.

K. HOVNANIAN AT DENVILLE, L.L.C.

K. HOVNANIAN AT DEPTFORD TOWNSHIP, L.L.C.

K. HOVNANIAN AT DOMINGUEZ HILLS, INC.

K. HOVNANIAN AT DOVER, L.L.C.

K. HOVNANIAN AT EAST BRANDYWINE, L.L.C.

K. HOVNANIAN AT EAST WHITELAND I, INC.

K. HOVNANIAN AT EASTLAKE, LLC

K. HOVNANIAN AT EDGEWATER II, L.L.C.

K. HOVNANIAN AT EDGEWATER, L.L.C.

K. HOVNANIAN AT EGG HARBOR TOWNSHIP II, L.L.C.

K. HOVNANIAN AT EGG HARBOR TOWNSHIP, L.L.C.

K. HOVNANIAN AT ELK TOWNSHIP, L.L.C.

K. HOVNANIAN AT ENCINITAS RANCH, LLC

K. HOVNANIAN AT EVERGREEN, L.L.C.

K. HOVNANIAN AT EWING, L.L.C.

K. HOVNANIAN AT FIFTH AVENUE, L.L.C.

K. HOVNANIAN AT FLORENCE I, L.L.C.

K. HOVNANIAN AT FLORENCE II, L.L.C.

K. HOVNANIAN AT FOREST MEADOWS, L.L.C.

K. HOVNANIAN AT FORKS TWP. I, L.L.C.

K. HOVNANIAN AT FRANKLIN, L.L.C.

K. HOVNANIAN AT FREEHOLD TOWNSHIP I, INC.

K. HOVNANIAN AT FREEHOLD TOWNSHIP, L.L.C.

K. HOVNANIAN AT GALLOWAY, L.L.C.

K. HOVNANIAN AT GASLAMP SQUARE, L.L.C.

K. HOVNANIAN AT GREAT NOTCH, L.L.C.

K. HOVNANIAN AT GUTTENBERG, L.L.C.

K. HOVNANIAN AT HACKETTSTOWN II, L.L.C.

K. HOVNANIAN AT HACKETTSTOWN, INC.

K. HOVNANIAN AT HAMBURG CONTRACTORS, L.L.C.

K. HOVNANIAN AT HAMBURG, L.L.C.

K. HOVNANIAN AT HAWTHORNE, L.L.C

K. HOVNANIAN AT HAZLET, L.L.C.

K. HOVNANIAN AT HERSHEY’S MILL, INC.

K. HOVNANIAN AT HIGHLAND SHORES, L.L.C.

K. HOVNANIAN AT HIGHLAND VINEYARDS, INC.

K. HOVNANIAN AT HIGHWATER, L.L.C.

K. HOVNANIAN AT HILLTOP, L.L.C.

K. HOVNANIAN AT HOPEWELL IV, INC.

K. HOVNANIAN AT HOPEWELL VI, INC.

K. HOVNANIAN AT HOWELL TOWNSHIP, INC.

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K. HOVNANIAN AT HUDSON POINTE, L.L.C.

K. HOVNANIAN AT JACKSON I, L.L.C.

K. HOVNANIAN AT JACKSON, L.L.C.

K. HOVNANIAN AT JERSEY CITY IV, L.L.C.

K. HOVNANIAN AT JERSEY CITY V URBAN RENEWAL COMPANY, L.L.C.

K. HOVNANIAN AT KEYPORT, L.L.C.

K. HOVNANIAN AT KING FARM, L.L.C.

K. HOVNANIAN AT KINGS GRANT I, INC.

K. HOVNANIAN AT LA COSTA GREENS, L.L.C.

K. HOVNANIAN AT LA COSTA, LLC

K. HOVNANIAN AT LA HABRA KNOLLS, LLC

K. HOVNANIAN AT LA TERRAZA, INC.

K. HOVNANIAN AT LAFAYETTE ESTATES, L.L.C.

K. HOVNANIAN AT LAKE HILLS, L.L.C.

K. HOVNANIAN AT LAKE RANCHO VIEJO, LLC

K. HOVNANIAN AT LAKE RIDGE CROSSING, L.L.C.

K. HOVNANIAN AT LAKE TERRAPIN, L.L.C.

K. HOVNANIAN AT LAKEWOOD, INC.

K. HOVNANIAN AT LAWRENCE V, L.L.C.

K. HOVNANIAN AT LINWOOD, L.L.C.

K. HOVNANIAN AT LITTLE EGG HARBOR CONTRACTORS, L.L.C.

K. HOVNANIAN AT LITTLE EGG HARBOR III, L.L.C.

K. HOVNANIAN AT LITTLE EGG HARBOR TOWNSHIP II, L.L.C.

K. HOVNANIAN AT LITTLE EGG HARBOR, L.L.C.

K. HOVNANIAN AT LONG BRANCH I, L.L.C.

K. HOVNANIAN AT LOWER MACUNGIE TOWNSHIP I, L.L.C.

K. HOVNANIAN AT LOWER MACUNGIE TOWNSHIP II, L.L.C.

K. HOVNANIAN AT LOWER MAKEFIELD TOWNSHIP I, L.L.C.

K. HOVNANIAN AT LOWER MORELAND I, L.L.C.

K. HOVNANIAN AT LOWER MORELAND II, L.L.C.

K. HOVNANIAN AT LOWER MORELAND III, L.L.C.

K. HOVNANIAN AT LOWER SAUCON, INC.

K. HOVNANIAN AT MACUNGIE, L.L.C.

K. HOVNANIAN AT MAHWAH II, INC.

K. HOVNANIAN AT MAHWAH VI, INC.

K. HOVNANIAN AT MAHWAH VII, INC.

K. HOVNANIAN AT MANALAPAN III, L.L.C.

K. HOVNANIAN AT MANALAPAN, INC.

K. HOVNANIAN AT MANSFIELD I, L.L.C.

K. HOVNANIAN AT MANSFIELD II, L.L.C.

K. HOVNANIAN AT MANSFIELD III, L.L.C.

K. HOVNANIAN AT MAPLE AVENUE, L.L.C.

K. HOVNANIAN AT MARLBORO II, INC.

K. HOVNANIAN AT MARLBORO TOWNSHIP III, INC.

K. HOVNANIAN AT MARLBORO TOWNSHIP IV, INC.

K. HOVNANIAN AT MARLBORO TOWNSHIP IX, L.L.C.

K. HOVNANIAN AT MARLBORO TOWNSHIP V, L.L.C.

K. HOVNANIAN AT MARLBORO TOWNSHIP VIII, L.L.C.

K. HOVNANIAN AT MARLBORO VI, L.L.C.

K. HOVNANIAN AT MARLBORO VII, L.L.C.

K. HOVNANIAN AT MATSU, L.L.C.

K. HOVNANIAN AT MENDHAM TOWNSHIP, L.L.C.

K. HOVNANIAN AT MENIFEE VALLEY CONDOMINIUMS, L.L.C.

K. HOVNANIAN AT MENIFEE, L.L.C.

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K. HOVNANIAN AT MIDDLE TOWNSHIP II, L.L.C.

K. HOVNANIAN AT MIDDLE TOWNSHIP, L.L.C.

K. HOVNANIAN AT MIDDLETOWN II, L.L.C.

K. HOVNANIAN AT MIDDLETOWN, L.L.C.

K. HOVNANIAN AT MILLVILLE I, L.L.C.

K. HOVNANIAN AT MILLVILLE II, L.L.C.

K. HOVNANIAN AT MILLVILLE III, L.L.C.

K. HOVNANIAN AT MOCKINGBIRD CANYON, L.L.C.

K. HOVNANIAN AT MONROE II, INC.

K. HOVNANIAN AT MONROE III, L.L.C.

K. HOVNANIAN AT MONROE IV, L.L.C.

K. HOVNANIAN AT MONROE NJ, L.L.C.

K. HOVNANIAN AT MONTGOMERY I, INC.

K. HOVNANIAN AT MONTVALE, L.L.C.

K. HOVNANIAN AT MOSAIC, LLC

K. HOVNANIAN AT MT. OLIVE TOWNSHIP, L.L.C.

K. HOVNANIAN AT NEW BRUNSWICK URBAN RENEWAL, L.L.C.

K. HOVNANIAN AT NEW WINDSOR, L.L.C.

K. HOVNANIAN AT NORTH BERGEN, L.L.C.

K. HOVNANIAN AT NORTH BRUNSWICK VI, L.L.C.

K. HOVNANIAN AT NORTH CALDWELL II, L.L.C.

K. HOVNANIAN AT NORTH CALDWELL III, L.L.C.

K. HOVNANIAN AT NORTH CALDWELL, L.L.C.

K. HOVNANIAN AT NORTH HALEDON, L.L.C.

K. HOVNANIAN AT NORTH WILDWOOD, L.L.C.

K. HOVNANIAN AT NORTHAMPTON, L.L.C.

K. HOVNANIAN AT NORTHERN WESTCHESTER, INC.

K. HOVNANIAN AT NORTHFIELD, L.L.C.

K. HOVNANIAN AT NORTHLAKE, INC.

K. HOVNANIAN AT OCEAN TOWNSHIP, INC.

K. HOVNANIAN AT OCEAN WALK, INC.

K. HOVNANIAN AT OCEANPORT, L.L.C.

K. HOVNANIAN AT OLD BRIDGE, L.L.C.

K. HOVNANIAN AT OLDE ORCHARD, LLC

K. HOVNANIAN AT ORANGE HEIGHTS, L.L.C.

K. HOVNANIAN AT PACIFIC BLUFFS, LLC

K. HOVNANIAN AT PARAMUS, L.L.C.

K. HOVNANIAN AT PARK LANE, LLC

K. HOVNANIAN AT PARSIPPANY-TROY HILLS, L.L.C.

K. HOVNANIAN AT PEAPACK-GLADSTONE, L.L.C.

K. HOVNANIAN AT PERKIOMEN I, INC.

K. HOVNANIAN AT PERKIOMEN II, INC.

K. HOVNANIAN AT PHILADELPHIA II, L.L.C.

K. HOVNANIAN AT PHILADELPHIA III, L.L.C.

K. HOVNANIAN AT PHILADELPHIA IV, L.L.C.

K. HOVNANIAN AT PIAZZA D’ORO, L.L.C.

K. HOVNANIAN AT PITTSGROVE, L.L.C.

K. HOVNANIAN AT PORT IMPERIAL URBAN RENEWAL IV, L.L.C.

K. HOVNANIAN AT PORT IMPERIAL URBAN RENEWAL V, L.L.C.

K. HOVNANIAN AT PORT IMPERIAL URBAN RENEWAL VI, L.L.C.

K. HOVNANIAN AT PORT IMPERIAL URBAN RENEWAL VII, L.L.C.

K. HOVNANIAN AT PORT IMPERIAL URBAN RENEWAL VIII, L.L.C.

K. HOVNANIAN AT PRADO, L.L.C.

K. HOVNANIAN AT PRINCETON LANDING, L.L.C.

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K. HOVNANIAN AT PRINCETON NJ, L.L.C.

K. HOVNANIAN AT RANCHO CRISTIANITOS, INC.

K. HOVNANIAN AT RANCHO SANTA MARGARITA, LLC

K. HOVNANIAN AT RANDOLPH I, L.L.C.

K. HOVNANIAN AT RAPHO, L.L.C.

K. HOVNANIAN AT READINGTON II, L.L.C.

K. HOVNANIAN AT RED BANK, L.L.C.

K. HOVNANIAN AT RESERVOIR RIDGE, INC.

K. HOVNANIAN AT RIDGEMONT, L.L.C.

K. HOVNANIAN AT RIDGESTONE, L.L.C.

K. HOVNANIAN AT RIVERBEND, LLC

K. HOVNANIAN AT RODERUCK, L.L.C.

K. HOVNANIAN AT ROSEMARY LANTANA, L.L.C.

K. HOVNANIAN AT ROWLAND HEIGHTS, LLC

K. HOVNANIAN AT SAGE, L.L.C.

K. HOVNANIAN AT SAN SEVAINE, INC.

K. HOVNANIAN AT SARATOGA, INC.

K. HOVNANIAN AT SAWMILL, INC.

K. HOVNANIAN AT SAYREVILLE, L.L.C.

K. HOVNANIAN AT SCOTCH PLAINS II, INC.

K. HOVNANIAN AT SCOTCH PLAINS, L.L.C.

K. HOVNANIAN AT SILVER SPRING, L.L.C.

K. HOVNANIAN AT SKYE ISLE, LLC

K. HOVNANIAN AT SMITHVILLE III, L.L.C.

K. HOVNANIAN AT SMITHVILLE, INC.

K. HOVNANIAN AT SOMERS POINT, L.L.C.

K. HOVNANIAN AT SOUTH BRUNSWICK V, INC.

K. HOVNANIAN AT SOUTH BRUNSWICK, L.L.C.

K. HOVNANIAN AT SPARTA, L.L.C.

K. HOVNANIAN AT SPRINGCO, L.L.C.

K. HOVNANIAN AT STONE CANYON, INC.

K. HOVNANIAN AT STONY POINT, INC.

K. HOVNANIAN AT SUNSETS, LLC

K. HOVNANIAN AT SYCAMORE, INC.

K. HOVNANIAN AT TANNERY HILL, INC.

K. HOVNANIAN AT TEANECK, L.L.C.

K. HOVNANIAN AT THE BLUFF, INC.

K. HOVNANIAN AT THE CROSBY, LLC

K. HOVNANIAN AT THE GABLES, LLC

K. HOVNANIAN AT THE MONARCH, L.L.C.

K. HOVNANIAN AT THE PRESERVE, L.L.C.

K. HOVNANIAN AT THOMPSON RANCH, LLC

K. HOVNANIAN AT THORNBURY, INC.

K. HOVNANIAN AT TIERRASANTA, INC.

K. HOVNANIAN AT TRAIL RIDGE, LLC

K. HOVNANIAN AT TRENTON, L.L.C.

K. HOVNANIAN AT TROVATA, INC.

K. HOVNANIAN AT TUXEDO, INC.

K. HOVNANIAN AT UNION TOWNSHIP I, INC.

K. HOVNANIAN AT UNION TOWNSHIP II, L.L.C.

K. HOVNANIAN AT UPPER FREEHOLD TOWNSHIP I, INC.

K. HOVNANIAN AT UPPER FREEHOLD TOWNSHIP II, L.L.C.

K. HOVNANIAN AT UPPER FREEHOLD TOWNSHIP III, L.L.C.

K. HOVNANIAN AT UPPER MAKEFIELD I, INC.

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K. HOVNANIAN AT UPPER UWCHLAN II, L.L.C.

K. HOVNANIAN AT UPPER UWCHLAN, L.L.C.

K. HOVNANIAN AT VAIL RANCH, INC.

K. HOVNANIAN AT VERONA URBAN RENEWAL, L.L.C.

K. HOVNANIAN AT VINELAND, L.L.C.

K. HOVNANIAN AT WALL TOWNSHIP VI, INC.

K. HOVNANIAN AT WALL TOWNSHIP VIII, INC.

K. HOVNANIAN AT WANAQUE, L.L.C.

K. HOVNANIAN AT WARREN TOWNSHIP, L.L.C.

K. HOVNANIAN AT WASHINGTON, L.L.C.

K. HOVNANIAN AT WASHINGTONVILLE, INC.

K. HOVNANIAN AT WAYNE III, INC.

K. HOVNANIAN AT WAYNE IX, L.L.C.

K. HOVNANIAN AT WAYNE V, INC.

K. HOVNANIAN AT WAYNE VIII, L.L.C.

K. HOVNANIAN AT WEST BRADFORD, L.L.C.

K. HOVNANIAN AT WEST MILFORD, L.L.C.

K. HOVNANIAN AT WEST WINDSOR, L.L.C.

K. HOVNANIAN AT WILDROSE, INC.

K. HOVNANIAN AT WILDWOOD BAYSIDE, L.L.C.

K. HOVNANIAN AT WILLOW BROOK, L.L.C.

K. HOVNANIAN AT WINCHESTER, LLC

K. HOVNANIAN AT WOODHILL ESTATES, L.L.C.

K. HOVNANIAN AT WOOLWICH I, L.L.C.

K. HOVNANIAN CAMBRIDGE HOMES, L.L.C.

K. HOVNANIAN CENTRAL ACQUISITIONS, L.L.C.

K. HOVNANIAN CHESTERFIELD INVESTMENT, L.L.C.

K. HOVNANIAN CLASSICS CIP, L.L.C.

K. HOVNANIAN CLASSICS, L.L.C.

K. HOVNANIAN COMMUNITIES, INC.

K. HOVNANIAN COMPANIES METRO D.C. NORTH, L.L.C.

K. HOVNANIAN COMPANIES NORTHEAST, INC.

K. HOVNANIAN COMPANIES OF CALIFORNIA, INC.

K. HOVNANIAN COMPANIES OF MARYLAND, INC.

K. HOVNANIAN COMPANIES OF NEW YORK, INC.

K. HOVNANIAN COMPANIES OF PENNSYLVANIA, INC.

K. HOVNANIAN COMPANIES OF SOUTHERN CALIFORNIA, INC.

K. HOVNANIAN COMPANIES OF VIRGINIA, INC.

K. HOVNANIAN COMPANIES, LLC

K. HOVNANIAN CONNECTICUT ACQUISITIONS, L.L.C.

K. HOVNANIAN CONSTRUCTION II, INC

K. HOVNANIAN CONSTRUCTION III, INC

K. HOVNANIAN CONSTRUCTION MANAGEMENT, INC.

K. HOVNANIAN CRAFTBUILT HOMES OF SOUTH CAROLINA, L.L.C.

K. HOVNANIAN DELAWARE ACQUISITIONS, L.L.C.

K. HOVNANIAN DEVELOPMENTS OF ARIZONA, INC.

K. HOVNANIAN DEVELOPMENTS OF CALIFORNIA, INC.

K. HOVNANIAN DEVELOPMENTS OF CONNECTICUT, INC.

K. HOVNANIAN DEVELOPMENTS OF D.C., INC.

K. HOVNANIAN DEVELOPMENTS OF DELAWARE, INC.

K. HOVNANIAN DEVELOPMENTS OF GEORGIA, INC.

K. HOVNANIAN DEVELOPMENTS OF ILLINOIS, INC.

K. HOVNANIAN DEVELOPMENTS OF INDIANA, INC.

K. HOVNANIAN DEVELOPMENTS OF KENTUCKY, INC.

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K. HOVNANIAN DEVELOPMENTS OF MARYLAND, INC.

K. HOVNANIAN DEVELOPMENTS OF MICHIGAN, INC.

K. HOVNANIAN DEVELOPMENTS OF MINNESOTA, INC.

K. HOVNANIAN DEVELOPMENTS OF NEW JERSEY II, INC.

K. HOVNANIAN DEVELOPMENTS OF NEW JERSEY, INC.

K. HOVNANIAN DEVELOPMENTS OF NEW YORK, INC.

K. HOVNANIAN DEVELOPMENTS OF NORTH CAROLINA, INC.

K. HOVNANIAN DEVELOPMENTS OF OHIO, INC.

K. HOVNANIAN DEVELOPMENTS OF PENNSYLVANIA, INC.

K. HOVNANIAN DEVELOPMENTS OF SOUTH CAROLINA, INC.

K. HOVNANIAN DEVELOPMENTS OF TEXAS, INC.

K. HOVNANIAN DEVELOPMENTS OF VIRGINIA, INC.

K. HOVNANIAN DEVELOPMENTS OF WEST VIRGINIA, INC.

K. HOVNANIAN EASTERN PENNSYLVANIA, L.L.C.

K. HOVNANIAN FIRST HOMES, L.L.C.

K. HOVNANIAN FLORIDA REALTY, L.L.C.

K. HOVNANIAN FORECAST HOMES NORTHERN, INC.

K. HOVNANIAN FOUR SEASONS @ HISTORIC VIRGINIA, LLC

K. HOVNANIAN FOUR SEASONS AT GOLD HILL, LLC

K. HOVNANIAN GREAT WESTERN BUILDING COMPANY, LLC

K. HOVNANIAN GREAT WESTERN HOMES, LLC

K. HOVNANIAN HOLDINGS NJ, L.L.C.

K. HOVNANIAN HOMES — DFW, L.L.C.

K. HOVNANIAN HOMES AT BELMONT OVERLOOK, L.L.C.

K. HOVNANIAN HOMES AT CAMERON STATION, LLC

K. HOVNANIAN HOMES AT CAMP SPRINGS, L.L.C.

K. HOVNANIAN HOMES AT CIDER MILL, L.L.C.

K. HOVNANIAN HOMES AT FAIRWOOD, L.L.C.

K. HOVNANIAN HOMES AT FOREST RUN, L.L.C.

K. HOVNANIAN HOMES AT GREENWAY FARM PARK TOWNS, L.L.C.

K. HOVNANIAN HOMES AT GREENWAY FARM, L.L.C.

K. HOVNANIAN HOMES AT JONES STATION 1, L.L.C.

K. HOVNANIAN HOMES AT JONES STATION 2, L.L.C.

K. HOVNANIAN HOMES AT MAXWELL PLACE. L.L.C.

K. HOVNANIAN HOMES AT NASSAU GROVE, L.L.C.

K. HOVNANIAN HOMES AT PAYNE STREET, L.L.C.

K. HOVNANIAN HOMES AT PRIMERA, L.L.C.

K. HOVNANIAN HOMES AT RENAISSANCE PLAZA, L.L.C.

K. HOVNANIAN HOMES AT RUSSETT, L.L.C.

K. HOVNANIAN HOMES AT VICTORIA STATION, L.L.C.

K. HOVNANIAN HOMES OF D.C., L.L.C.

K. HOVNANIAN HOMES OF DELAWARE, L.L.C.

K. HOVNANIAN HOMES OF GEORGIA, L.L.C.

K. HOVNANIAN HOMES OF HOUSTON, L.L.C.

K. HOVNANIAN HOMES OF INDIANA, L.L.C.

K. HOVNANIAN HOMES OF MARYLAND, L.L.C.

K. HOVNANIAN HOMES OF MINNESOTA, L.L.C.

K. HOVNANIAN HOMES OF NORTH CAROLINA, INC.

K. HOVNANIAN HOMES OF PENNSYLVANIA, L.L.C.

K. HOVNANIAN HOMES OF SOUTH CAROLINA, LLC

K. HOVNANIAN HOMES OF VIRGINIA, INC.

K. HOVNANIAN HOMES OF WEST VIRGINIA, L.L.C.

K. HOVNANIAN INTERNATIONAL, L.L.C.

K. HOVNANIAN NORTH CENTRAL ACQUISITIONS, L.L.C.

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K. HOVNANIAN NORTH JERSEY ACQUISITIONS, L.L.C.

K. HOVNANIAN NORTHEAST SERVICES, L.L.C.

K. HOVNANIAN OF HOUSTON II, L.L.C.

K. HOVNANIAN OHIO REALTY, L.L.C.

K. HOVNANIAN OSTER HOMES, L.L.C.

K. HOVNANIAN PA REAL ESTATE, INC.

K. HOVNANIAN PENNSYLVANIA ACQUISITIONS, L.L.C.

K. HOVNANIAN PORT IMPERIAL URBAN RENEWAL, INC.

K. HOVNANIAN PROPERTIES OF RED BANK, INC.

K. HOVNANIAN SHORE ACQUISITIONS, L.L.C.

K. HOVNANIAN SOUTH JERSEY ACQUISITIONS, L.L.C.

K. HOVNANIAN SOUTHERN NEW JERSEY, L.L.C.

K. HOVNANIAN STANDING ENTITY, L.L.C.

K. HOVNANIAN SUMMIT HOLDINGS, L.L.C.

K. HOVNANIAN SUMMIT HOMES OF KENTUCKY, L.L.C.

K. HOVNANIAN SUMMIT HOMES OF MICHIGAN, L.L.C.

K. HOVNANIAN SUMMIT HOMES OF PENNSYLVANIA, L.L.C.

K. HOVNANIAN SUMMIT HOMES OF WEST VIRGINIA, L.L.C.

K. HOVNANIAN SUMMIT HOMES, L.L.C.

K. HOVNANIAN T&C HOMES AT FLORIDA, L.L.C.

K. HOVNANIAN T&C HOMES AT ILLINOIS, L.L.C.

K. HOVNANIAN T&C HOMES AT MINNESOTA, L.L.C.

K. HOVNANIAN T&C INVESTMENT, L.L.C.

K. HOVNANIAN T&C MANAGEMENT CO., L.L.C.

K. HOVNANIAN VENTURE I, L.L.C.

K. HOVNANIAN WINDWARD HOMES, LLC

K. HOVNANIAN’S FOUR SEASONS AT ASHBURN VILLAGE, L.L.C.

K. HOVNANIAN’S FOUR SEASONS AT BAILEY’S GLENN, L.L.C.

K. HOVNANIAN’S FOUR SEASONS AT BAKERSFIELD, L.L.C.

K. HOVNANIAN’S FOUR SEASONS AT BEAUMONT, LLC

K. HOVNANIAN’S FOUR SEASONS AT CHARLOTTESVILLE, L.L.C.

K. HOVNANIAN’S FOUR SEASONS AT DULLES DISCOVERY CONDOMINIUM, L.L.C.

K. HOVNANIAN’S FOUR SEASONS AT DULLES DISCOVERY, L.L.C.

K. HOVNANIAN’S FOUR SEASONS AT HAMPTONBURGH, L.L.C.

K. HOVNANIAN’S FOUR SEASONS AT HEMET, LLC

K. HOVNANIAN’S FOUR SEASONS AT HUNTFIELD, L.L.C.

K. HOVNANIAN’S FOUR SEASONS AT KENT ISLAND CONDOMINIUMS, L.L.C.

K. HOVNANIAN’S FOUR SEASONS AT KENT ISLAND, L.L.C.

K. HOVNANIAN’S FOUR SEASONS AT MENIFEE VALLEY, L.L.C.

K. HOVNANIAN’S FOUR SEASONS AT NEW KENT VINEYARDS, L.L.C.

K. HOVNANIAN’S FOUR SEASONS AT PALM SPRINGS, LLC

K. HOVNANIAN’S FOUR SEASONS AT RENAISSANCE, L.L.C.

K. HOVNANIAN’S FOUR SEASONS AT RUSH CREEK, L.L.C.

K. HOVNANIAN’S FOUR SEASONS AT ST. MARGARETS LANDING, L.L.C.

K. HOVNANIAN’S FOUR SEASONS AT VINT HILL, L.L.C.

K. HOVNANIAN’S FOUR SEASONS, LLC

K. HOVNANIAN’S PARKSIDE AT TOWNGATE, L.L.C.

K. HOVNANIAN’S PRIVATE HOME PORTFOLIO, L.L.C.

KHIP, L.L.C.

LANDARAMA, INC.

M & M AT KENSINGTON WOODS, L.L.C.

M & M AT LONG BRANCH, INC

M&M AT APPLE RIDGE, L.L.C.

M&M AT CHESTERFIELD, L.L.C.

A-23

 

M&M AT COPPER BEECH, L.L.C.

M&M AT CRESCENT COURT, L.L.C.

M&M AT EAST MILL, L.L.C.

M&M AT EAST RUTHERFORD, L.L.C.

M&M AT MORRISTOWN, L.L.C.

M&M AT SHERIDAN, L.L.C.

M&M AT SPINNAKER POINTE, L.L.C.

M&M AT SPRUCE HOLLOW, L.L.C.

M&M AT SPRUCE RUN, L.L.C.

M&M AT STATION SQUARE, L.L.C.

M&M AT TAMARACK HOLLOW, L.L.C.

M&M AT THE CHATEAU, L.L.C.

M&M AT THE HIGHLANDS, L.L.C.

M&M AT UNION, L.L.C.

M&M AT WEST ORANGE, L.L.C.

M&M AT WESTPORT, L.L.C.

M&M AT WHEATENA URBAN RENEWAL, L.L.C.

M&M INVESTMENTS, L.P.

MATZEL & MUMFORD AT EGG HARBOR, L.L.C.

MATZEL & MUMFORD AT MONTGOMERY, L.L.C.

MATZEL & MUMFORD AT SOUTH BOUND BROOK URBAN RENEWAL, L.L.C.

MCNJ, INC.

MIDWEST BUILDING PRODUCTS & CONTRACTOR SERVICES OF KENTUCKY, L.L.C.

MIDWEST BUILDING PRODUCTS & CONTRACTOR SERVICES OF MICHIGAN, L.L.C.

MIDWEST BUILDING PRODUCTS & CONTRACTOR SERVICES OF PENNSYLVANIA, L.L.C.

MIDWEST BUILDING PRODUCTS & CONTRACTOR SERVICES OF WEST VIRGINIA, L.L.C.

MIDWEST BUILDING PRODUCTS & CONTRACTOR SERVICES, L.L.C.

MMIP, L.L.C.

NATOMAS CENTRAL NEIGHBORHOOD HOUSING, L.L.C.

NEW LAND TITLE AGENCY, L.L.C.

PADDOCKS, L.L.C.

PARK TITLE COMPANY, LLC

PINE AYR, LLC

RIDGEMORE UTILITY ASSOCIATES OF PENNSYLVANIA, L.L.C.

RIDGEMORE UTILITY L.L.C.

SEABROOK ACCUMULATION CORPORATION

STONEBROOK HOMES, INC.

TERRAPIN REALTY, L.L.C.

THE LANDINGS AT SPINNAKER POINTE, L.L.C.

THE MATZEL & MUMFORD ORGANIZATION, INC

WASHINGTON HOMES AT COLUMBIA TOWN CENTER, L.L.C.

WASHINGTON HOMES, INC.

WESTMINSTER HOMES OF ALABAMA, L.L.C.

WESTMINSTER HOMES OF MISSISSIPPI, LLC

WESTMINSTER HOMES OF TENNESSEE, INC.

WESTMINSTER HOMES, INC.

WH LAND I, INC

WH PROPERTIES, INC.

WH/PR LAND COMPANY, L.L.C.

WOODLAND LAKE CONDOMINIUMS AT BOWIE NEW TOWN, L.L.C.

A-24

 

	 	 	 	 	 
	 	 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	Authorized Officer 	 
	 

[This Guarantee relates to K. Hovnanian’s 18.0% Senior Secured Notes due 2017 – CUSIP No.:
                    ]

A-25

 

EXHIBIT B

SUPPLEMENTAL INDENTURE

dated as of                     , ___

among

K. HOVNANIAN ENTERPRISES, INC.

HOVNANIAN ENTERPRISES, INC.

The Other Guarantors Party Hereto

and

WILMINGTON TRUST COMPANY

as Trustee

 

18.0% Senior Secured Notes due 2017

B-1

 

     THIS [                    ] SUPPLEMENTAL INDENTURE (this “[                    ] Supplemental Indenture”), entered into as
of [                                        ], [___], among K. Hovnanian Enterprises, Inc., a California corporation (the
“Issuer”), Hovnanian Enterprises, Inc. (the “Company”), [list each new guarantor and its
jurisdiction of incorporation] (each an “Undersigned”) and Wilmington Trust Company, a Delaware
banking corporation, as Trustee (the “Trustee”).

RECITALS

     WHEREAS, the Issuer, Company, the other Guarantors party thereto and the Trustee entered into
an indenture, dated as of December 3, 2008 (the “Indenture”), relating to the Company’s 18.0%
Senior Secured Notes due 2017 (the “Notes”);

     WHEREAS, as a condition to the purchase of the Notes by the Holders, the Company agreed
pursuant to the Indenture to cause any newly acquired or created Restricted Subsidiaries to provide
Guarantees.

AGREEMENT

     NOW, THEREFORE, in consideration of the premises and mutual covenants herein contained and
intending to be legally bound, the parties hereto hereby agree as follows:

     Section 1. Capitalized terms used herein and not otherwise defined herein are used
as defined in the Indenture.

     Section 2. Each Undersigned, by its execution of this [                    ] Supplemental
Indenture, agrees to be a Guarantor under the Indenture and to be bound by the terms of the
Indenture applicable to Guarantors, including, but not limited to, Article 6 thereof.

     Section 3. This [                    ] Supplemental Indenture shall be governed by and construed in
accordance with the laws of the State of New York.

     Section 4. This [                    ] Supplemental Indenture may be signed in various counterparts
which together will constitute one and the same instrument.

     Section 5. This [                    ] Supplemental Indenture is an amendment supplemental to the
Indenture and the Indenture and this [                    ] Supplemental Indenture will henceforth be read
together.

     Section 6. The Trustee shall not be responsible in any manner whatsoever for or in
respect of the validity or sufficiency of this Supplemental

B-2

 

Indenture or for or in respect of the
Recitals contained herein, all of which are made solely by the Issuer, the Company and each of the
undersigned.

B-3

 

     IN WITNESS WHEREOF, the parties hereto have caused this [                    ] Supplemental Indenture to be
duly executed as of the date first above written.

	 	 	 	 	 
	 	K. HOVNANIAN ENTERPRISES, INC., 

     as Issuer

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 
	 	HOVNANIAN ENTERPRISES, INC.

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 
	 	[GUARANTOR]

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 
	 	WILMINGTON TRUST COMPANY,

as Trustee

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 

B-4

 

	 	 	 	 	 

EXHIBIT C

RESTRICTED LEGEND

     THIS SECURITY (OR ITS PREDECESSOR) HAS NOT BEEN REGISTERED UNDER THE U.S. SECURITIES ACT OF
1933, AS AMENDED (THE “SECURITIES ACT”), AND, ACCORDINGLY, MAY NOT BE OFFERED, SOLD, PLEDGED OR
OTHERWISE TRANSFERRED WITHIN THE UNITED STATES OR TO, OR FOR THE ACCOUNT OR BENEFIT OF, U.S.
PERSONS, EXCEPT AS SET FORTH IN THE FOLLOWING SENTENCE. BY ITS ACQUISITION HEREOF OR OF A
BENEFICIAL INTEREST HEREIN, THE HOLDER:

     (1) REPRESENTS THAT (A) IT IS A “QUALIFIED INSTITUTIONAL BUYER” (AS DEFINED IN RULE 144A UNDER
THE SECURITIES ACT) (A “QIB”), (B) IT IS NOT A U.S. PERSON, IS NOT ACQUIRING THIS SECURITY FOR THE
ACCOUNT OR BENEFIT OF A U.S. PERSON AND IS ACQUIRING THIS SECURITY IN AN OFFSHORE TRANSACTION IN
COMPLIANCE WITH REGULATION S UNDER THE SECURITIES ACT OR (C) IT IS AN INSTITUTIONAL “ACCREDITED
INVESTOR” WITHIN THE MEANING OF RULE 501(a)(1), (2), (3) OR (7) UNDER REGULATION D OF THE
SECURITIES ACT (AN “IAI”),

     (2) AGREES THAT IT WILL NOT, WITHIN THE TIME PERIOD REFERRED TO UNDER RULE 144(d)(1) UNDER THE
SECURITIES ACT (TAKING INTO ACCOUNT THE PROVISIONS OF RULE 144(d) UNDER THE SECURITIES ACT, IF
APPLICABLE) AS IN EFFECT ON THE DATE OF THE TRANSFER OF THIS SECURITY, RESELL OR OTHERWISE TRANSFER
THIS SECURITY EXCEPT (A) TO THE ISSUER, THE COMPANY OR ANY OF ITS SUBSIDIARIES, (B) TO A PERSON
WHOM THE HOLDER REASONABLY BELIEVES IS A QIB OR PURCHASING FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT
OF A QIB IN COMPLIANCE WITH RULE 144A UNDER THE SECURITIES ACT, (C) IN COMPLIANCE WITH AN AVAILABLE
EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT PROVIDED THAT PRIOR TO SUCH
TRANSFER, THE TRUSTEE IS FURNISHED WITH AN OPINION OF COUNSEL ACCEPTABLE TO THE ISSUER THAT SUCH
TRANSFER IS IN COMPLIANCE WITH THE SECURITIES ACT, (D) OUTSIDE THE UNITED STATES IN AN OFFSHORE
TRANSACTION IN COMPLIANCE WITH RULE 904 UNDER THE SECURITIES ACT, (E) PURSUANT TO THE EXEMPTION
FROM REGISTRATION PROVIDED BY RULE 144 UNDER THE SECURITIES ACT (IF AVAILABLE AND PROVIDED THAT
PRIOR TO SUCH TRANSFER, THE TRUSTEE IS FURNISHED WITH AN OPINION OF COUNSEL ACCEPTABLE TO THE
ISSUER THAT SUCH TRANSFER IS IN COMPLIANCE WITH THE SECURITIES ACT), (F) TO AN IAI THAT,

C-1

 

PRIOR TO
SUCH TRANSFER, FURNISHES THE TRUSTEE A SIGNED LETTER CONTAINING CERTAIN REPRESENTATIONS AND
AGREEMENTS RELATING TO THE TRANSFER OF THIS SECURITY (THE FORM OF WHICH CAN BE OBTAINED FROM
THE TRUSTEE) AND, IF SUCH TRANSFER IS IN RESPECT OF AN AGGREGATE PRINCIPAL AMOUNT OF NOTES LESS
THAN $250,000, AN OPINION OF COUNSEL ACCEPTABLE TO THE ISSUER AND THE TRUSTEE THAT SUCH TRANSFER IS
IN COMPLIANCE WITH THE SECURITIES ACT OR (G) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER
THE SECURITIES ACT AND, IN EACH CASE, IN ACCORDANCE WITH APPLICABLE STATE SECURITIES LAWS, AND

     (3) AGREES THAT IT WILL DELIVER TO EACH PERSON TO WHOM THIS SECURITY OR AN INTEREST HEREIN IS
TRANSFERRED (OTHER THAN A TRANSFER PURSUANT TO CLAUSE (2)(D) OR 2(E) ABOVE) A NOTICE SUBSTANTIALLY
TO THE EFFECT OF THIS LEGEND.

     IN CONNECTION WITH ANY TRANSFER OF THIS SECURITY OR ANY INTEREST HEREIN WITHIN THE TIME PERIOD
REFERRED TO ABOVE, THE HOLDER MUST CHECK THE APPROPRIATE BOX SET FORTH ON THE REVERSE HEREOF
RELATING TO THE MANNER OF SUCH TRANSFER AND SUBMIT THIS CERTIFICATE TO THE TRUSTEE. AS USED
HEREIN, THE TERMS “OFFSHORE TRANSACTION,” “UNITED STATES” AND “U.S. PERSON” HAVE THE MEANINGS GIVEN
TO THEM BY RULE 902 OF REGULATION S UNDER THE SECURITIES ACT. THE INDENTURE CONTAINS A PROVISION
REQUIRING THE TRUSTEE TO REFUSE TO REGISTER ANY TRANSFER OF THIS SECURITY IN VIOLATION OF THE
FOREGOING.

C-2

 

EXHIBIT D

DTC LEGEND

     UNLESS THIS SECURITY IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST
COMPANY, A NEW YORK CORPORATION (“DTC”), TO THE ISSUER OR ANY OF ITS SUBSIDIARIES OR ITS AGENT FOR
REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY SECURITY ISSUED IS REGISTERED IN THE NAME OF
CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY
PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO
ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS A BENEFICIAL
INTEREST HEREIN.

     THIS SECURITY IS A GLOBAL NOTE WITHIN THE MEANING OF THE INDENTURE HEREINAFTER REFERRED.
TRANSFERS OF THIS GLOBAL NOTE ARE LIMITED TO TRANSFERS IN WHOLE, BUT NOT IN PART, BY DTC TO A
NOMINEE OF DTC OR BY A NOMINEE OF DTC TO DTC OR ANOTHER NOMINEE OF DTC OR BY DTC OR ANY SUCH
NOMINEE TO A SUCCESSOR DEPOSITARY OR A NOMINEE OF SUCH SUCCESSOR DEPOSITARY AND TRANSFERS OF
PORTIONS OF THIS GLOBAL NOTE ARE LIMITED TO TRANSFERS MADE IN ACCORDANCE WITH THE TRANSFER
PROVISIONS OF THE INDENTURE.

D-1

 

EXHIBIT E

Regulation S Certificate

                    , ____

Wilmington Trust Company

Rodney Square North

1100 North Market Street

Wilmington, DE 19890-1605

Facsimile: 302-636-4149

Attention: Corporate Client Services

	 	 	 	 	 
	 
	 	Re:	 	K. Hovnanian Enterprises, Inc.
	 
	 	 	 	18.0% Senior Secured Notes due 2017 (the “Notes”)
	 
	 	 	 	Issued under the Indenture (the “Indenture”) dated as
	 
	 	 	 	as of December 3, 2008 relating to the Notes

Dear Sirs:

     Terms are used in this Certificate as used in Regulation S (“Regulation S”) under the
Securities Act of 1933, as amended (the “Securities Act”), except as otherwise stated herein.

     [CHECK A OR B AS APPLICABLE.]

	 	    o   A.	 	This Certificate relates to our proposed transfer of $___ principal amount
of Notes issued under the Indenture. We hereby certify as follows:

	 	1.	 	The offer and sale of the Notes was not and will
not be made to a person in the United States (unless such person is
excluded from the definition of “U.S. person” pursuant to Rule
902(k)(2)(vi) or the account held by it for which it is acting is
excluded from the definition of “U.S. person” pursuant to Rule
902(k)(2)(i) under the circumstances described in Rule 902(g)(3)) and
such offer and sale was not and will not be specifically targeted at an
identifiable group of U.S. citizens abroad.
	 
	 	2.	 	Unless the circumstances described in the
parenthetical in paragraph 1 above are applicable, either (a) at the
time the buy order was originated, the buyer was outside the United
States or we and any person acting on our behalf reasonably believed
that the buyer was

E-1

 

	 	 	 	outside the United States or (b) the transaction was executed in, on
or through the facilities of a designated offshore securities
market, and neither we nor any person acting on our behalf knows
that the transaction was pre-arranged with a buyer in the United
States.

	 	3.	 	Neither we, any of our affiliates, nor any person
acting on our or their behalf has made any directed selling efforts in
the United States with respect to the Notes.
	 
	 	4.	 	The proposed transfer of Notes is not part of a
plan or scheme to evade the registration requirements of the Securities
Act.
	 
	 	5.	 	If we are a dealer or a person receiving a
selling concession, fee or other remuneration in respect of the Notes,
and the proposed transfer takes place during the Restricted Period (as
defined in the Indenture), or we are an officer or director of the
Company or [a Dealer Manager] [an Initial Purchaser] (as defined in the
Indenture), we certify that the proposed transfer is being made in
accordance with the provisions of Rule 904(b) of Regulation S.

	 	o   B.	 	This Certificate relates to our proposed exchange of $___ principal amount
of Notes issued under the Indenture for an equal principal amount of Notes to be
held by us. We hereby certify as follows:

	 	1.	 	At the time the offer and sale of the Notes was
made to us, either (i) we were not in the United States or (ii) we were
excluded from the definition of “U.S. person” pursuant to Rule
902(k)(2)(vi) or the account held by us for which we were acting was
excluded from the definition of “U.S. person” pursuant to Rule
902(k)(2)(i) under the circumstances described in Rule 902(g)(3); and we
were not a member of an identifiable group of U.S. citizens abroad.
	 
	 	2.	 	Unless the circumstances described in paragraph
1(ii) above are applicable, either (a) at the time our buy order was
originated, we were outside the United States or (b) the transaction was
executed in, on or through the

E-2

 

	 	 	 	facilities of a designated offshore
securities market and we did not pre-arrange the transaction in the
United States.

	 	3.	 	The proposed exchange of Notes is not part of a
plan or scheme to evade the registration requirements of the Securities
Act.

     You and the Issuer are entitled to rely upon this Certificate and are irrevocably authorized
to produce this Certificate or a copy hereof to any interested party in any administrative or legal
proceeding or official inquiry with respect to the matters covered hereby.

	 	 	 	 	 	 	 
	 	 	Very truly yours,	 	 
	 
	 	 	 	 	 	 
	 	 	[NAME OF SELLER (FOR 

     TRANSFERS) OR OWNER (FOR 

     EXCHANGES)]	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	Name:	 	 
	 

	 	 	 	Title:	 	 
	 

	 	 	 	Address:	 	 

Date:                                        

     Upon transfer of certificated Notes, the Notes would be registered in the name of the new
beneficial owner as follows:

	 	 	 	 	 
	By:
	 	 	 	 
	 

	 	 

	 	 

	 	 	 	 	 
	Date:
	 	 	 	 
	 

	 	 

	 	 

	 	 	 	 	 
	Taxpayer ID number:
	 	 	 	 
	 

	 	 

	 	 

E-3

 

EXHIBIT F

Rule 144A Certificate

                    , ____

Wilmington Trust Company

Rodney Square North

1100 North Market Street

Wilmington, DE 19890-1605

Facsimile: 302-636-4149

Attention: Corporate Client Services

	 	 	 	 	 
	 
	 	Re:	 	K. Hovnanian Enterprises, Inc.
	 
	 	 	 	18.0% Senior Secured Notes due 2017 (the “Notes”)
	 
	 	 	 	Issued under the Indenture (the “Indenture”) dated as
	 
	 	 	 	as of December 3, 2008 relating to the Notes

Ladies and Gentlemen:

     This Certificate relates to:

     [CHECK A OR B AS APPLICABLE.]

	 	o  A.	 	Our proposed purchase of $___ principal amount of Notes issued under the
Indenture.
	 
	 	o  B.	 	Our proposed transfer or exchange of $___ principal amount of Notes issued
under the Indenture for an equal principal amount of Notes to be held by us.

     We and, if applicable, each account for which we are acting, are a qualified institutional
buyer within the meaning of Rule 144A (“Rule 144A”) under the Securities Act of 1933, as amended
(the “Securities Act”). If we are acting on behalf of an account, we exercise sole investment
discretion with respect to such account. We are aware that the transfer of Notes to us, or such
exchange, as applicable, is being made in reliance upon the exemption from the provisions of
Section 5 of the Securities Act provided by Rule 144A. Prior to the date of this Certificate we
have received such information regarding the Company as we have requested pursuant to Rule
144A(d)(4) or have determined not to request such information.

F-1

 

     You and the Issuer are entitled to rely upon this Certificate and are irrevocably authorized
to produce this Certificate or a copy hereof to any
interested party in any administrative or legal proceeding or official inquiry with respect to
the matters covered hereby.

	 	 	 	 	 	 	 
	 	 	Very truly yours,	 	 
	 
	 	 	 	 	 	 
	 	 	[NAME OF PURCHASER (FOR 

     TRANSFERS) OR OWNER (FOR 

     EXCHANGES)]	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	Name:	 	 
	 

	 	 	 	Title:	 	 
	 

	 	 	 	Address:	 	 

Date:                                        

     Upon transfer of certificated Notes, the Notes would be registered in the name of the new
beneficial owner as follows:

	 	 	 	 	 
	By:
	 	 	 	 
	 

	 	 

	 	 

	 	 	 	 	 
	Date:
	 	 	 	 
	 

	 	 

	 	 

	 	 	 	 	 
	Taxpayer ID number:
	 	 	 	 
	 

	 	 

	 	 

F-2

 

EXHIBIT G

Institutional Accredited Investor Certificate

Wilmington Trust Company

Rodney Square North

1100 North Market Street

Wilmington, DE 19890-1605

Facsimile: 302-636-4149

Attention: Corporate Client Services

	 	 	 	 	 
	 
	 	Re:	 	K. Hovnanian Enterprises, Inc.
	 
	 	 	 	18.0% Senior Secured Notes due 2017 (the “Notes”)
	 
	 	 	 	Issued under the Indenture (the “Indenture”) dated as
	 
	 	 	 	as of December 3, 2008 relating to the Notes 

Ladies and Gentlemen:

     This Certificate relates to:

     [CHECK A, B OR C AS APPLICABLE.]

	 	o  A.	 	Our proposed purchase of $___ principal amount of Notes issued under the
Indenture.
	 
	 	o  B.	 	Our proposed purchase of $___ principal amount of a beneficial interest in
a Global Note
	 
	 	o  C.	 	Our proposed transfer or exchange of $___ principal amount of Notes issued
under the Indenture for an equal principal amount of Notes to be held by us.

     We hereby confirm that:

	 	1.	 	We are an institutional “accredited investor” as
defined in Rule 501(a)(1), (2), (3) or (7) of Regulation D under the
Securities Act of 1933, as amended (the “Securities Act”) (an
“Institutional Accredited Investor”).
	 
	 	2.	 	Any acquisition of Notes by us will be for our
own account or for the account of one or more other Institutional
Accredited Investors as to which we exercise sole investment discretion.

G-1

 

	 	3.	 	We have such knowledge and experience in
financial and business matters that we are capable of evaluating
the merits and risks of an investment in the Notes and we and any
accounts for which we are acting are able to bear the economic risks
of and an entire loss of our or their investment in the Notes.
	 
	 	4.	 	We are not acquiring the Notes or beneficial
interest therein with a view to any distribution thereof in a
transaction that would violate the Securities Act or the securities laws
of any State of the United States or any other applicable jurisdiction;
provided, that the disposition of our property and the property of any
accounts for which we are acting as fiduciary will remain at all times
within our and their control.
	 
	 	5.	 	We acknowledge that the Notes have not been
registered under the Securities Act and that the Notes may not be
offered or sold within the United States or to or for the benefit of
U.S. persons except as set forth below.
	 
	 	6.	 	The principal amount of Notes to which this
Certificate relates is at least equal to $250,000.

     We agree for the benefit of the Issuer and the Guarantors, on our own behalf and on behalf of
each account for which we are acting, that we will not, within the time period referred to under
Rule 144(d)(1) under the Securities Act (taking into account the provisions of Rule 144(d) under
the Securities Act, if applicable) as in effect on the date of the transfer of this Note, resell or
otherwise transfer this Note except (A) to the Issuer, the Company or any of its subsidiaries, (B)
to a person whom we reasonably believe is a QIB or purchasing for its own account or for the
account of a QIB in compliance with Rule 144A under the Securities Act, (C) in compliance with an
available exemption from the registration requirements of the Securities Act provided that prior to
such transfer, the Trustee is furnished with an opinion of counsel acceptable to the Issuer that
such transfer is in compliance with the Securities Act, (D) outside the United States in an
offshore transaction in compliance with Rule 904 under the Securities Act, (E) pursuant to the
exemption from registration provided by Rule 144 under the Securities Act (if available and
provided that prior to such transfer, the Trustee is furnished with an opinion of counsel
acceptable to the Issuer that such transfer is in compliance with the Securities Act), (F) to an
IAI that, prior to such transfer, furnishes the Trustee a signed letter containing certain
representations and agreements relating to the transfer of this Note (the form of which can be
obtained from the Trustee) and, if such transfer is in respect of an aggregate principal

G-2

 

amount of
Notes less than $250,000, an opinion of counsel acceptable to the Issuer and the Trustee that such
transfer is in compliance with the Securities Act or (G) pursuant to an effective registration
statement under the Securities Act and, in each case, in accordance with applicable state
securities laws.

     Prior to the registration of any transfer or exchange, we acknowledge that the Issuer reserves
the right to require the delivery of such legal opinions, certifications or other evidence as may
reasonably be required in order to determine that the proposed transfer or exchange is being made
in compliance with the Securities Act and applicable state securities laws. We acknowledge that no
representation is made as to the availability of any Rule 144 exemption from the registration
requirements of the Securities Act.

     We understand that the Trustee will not be required to accept for registration of transfer or
exchange any Notes acquired by us, except upon presentation of evidence satisfactory to the Issuer
and the Trustee that the foregoing restrictions on transfer have been complied with. We further
agree to deliver to each person acquiring any of the Notes or any beneficial interest therein from
us a notice advising such person that resales of the Notes are restricted as stated herein.

     We agree to notify you promptly in writing if any of our acknowledgments, representations or
agreements herein ceases to be accurate and complete.

     We represent to you that we have full power to make the foregoing acknowledgments,
representations and agreements on our own behalf and on behalf of any account for which we are
acting.

     You and the Issuer are entitled to rely upon this Certificate and are irrevocably authorized
to produce this Certificate or a copy hereof to any interested party in any administrative or legal
proceeding or official inquiry with respect to the matters covered hereby.

	 	 	 	 	 	 	 
	 	 	Very truly yours,	 	 
	 
	 	 	 	 	 	 
	 

	 	[NAME OF PURCHASER (FOR

      TRANSFERS) OR OWNER (FOR 

      EXCHANGES)]	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	Name:	 	 
	 

	 	 	 	Title:	 	 
	 

	 	 	 	Address:	 	 

Date:                                        

G-3

 

     Upon transfer of certificated Notes, the Notes would be registered in the name of the new
beneficial owner as follows:

	 	 	 	 	 
	By:
	 	 	 	 
	 

	 	 

	 	 

	 	 	 	 	 
	Date:
	 	 	 	 
	 

	 	 

	 	 

	 	 	 	 	 
	Taxpayer ID number:
	 	 	 	 
	 

	 	 

	 	 

G-4

 

EXHIBIT H

[COMPLETE FORM I OR FORM II AS APPLICABLE.]

[FORM I]

Certificate of Beneficial Ownership

	 	 	 
	To:

	 	Wilmington Trust Company
	 

	 	Rodney Square North
	 

	 	1100 North Market Street
	 

	 	Wilmington, DE 19890-1605
	 

	 	Facsimile: 302-636-4149
	 

	 	Attention: Corporate Client Services
	 
	 	 
	 

	 	[Euroclear Bank S.A./N.V., as operator of the Euroclear System] OR
	 
	 	 
	 

	 	[Clearstream Banking, société anonyme]

	 	 	 	 	 
	 

	 	Re:
	 	K. Hovnanian Enterprises, Inc.
	 

	 	 	 	18.0% Senior Secured Notes due 2017 (the “Notes”)
	 

	 	 	 	Issued under the Indenture (the “Indenture”) dated as
	 

	 	 	 	as of December 3, 2008 relating to the Notes 

Ladies and Gentlemen:

       We are the beneficial owner of $___ principal amount of Notes issued under the Indenture and
represented by a Regulation S Temporary Global Note (as defined in the Indenture).

       [CHECK A OR B AS APPLICABLE.]

	 	o  A.	 	We are a non-U.S. person (within the meaning of Regulation S under the
Securities Act of 1933, as amended).
	 
	 	o  B.	 	We are a U.S. person (within the meaning of Regulation S under the
Securities Act of 1933, as amended) that purchased the Notes in a transaction that
did not require registration under the Securities Act of 1933, as amended.

      You and the Issuer are entitled to rely upon this Certificate and are irrevocably authorized
to produce this Certificate or a copy hereof to any interested party in any administrative or legal
proceeding or official inquiry with respect to the matters covered hereby.

H-1

 

	 	 	 	 	 	 	 
	 	 	Very truly yours,	 	 
	 
	 	 	 	 	 	 
	 	 	[NAME OF BENEFICIAL OWNER]	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	Name:	 	 
	 

	 	 	 	Title:	 	 
	 

	 	 	 	Address:	 	 

Date:                                        

H-2

 

[FORM II]

Certificate of Beneficial Ownership

	 	 	 
	To:

	 	Wilmington Trust Company
	 

	 	Rodney Square North
	 

	 	1100 North Market Street
	 

	 	Wilmington, DE 19890-1605
	 

	 	Facsimile: 302-636-4149
	 

	 	Attention: Corporate Client Services

	 	 	 	 	 
	 

	 	Re:
	 	K. Hovnanian Enterprises, Inc.
	 

	 	 	 	18.0% Senior Secured Notes due 2017 (the “Notes”)
	 

	 	 	 	Issued under the Indenture (the “Indenture”) dated as
	 

	 	 	 	as of December 3, 2008 relating to the Notes

Ladies and Gentlemen:

          This is to certify that based solely on certifications we have received in writing, by tested
telex or by electronic transmission from member organizations (“Member Organizations”) appearing in
our records as persons being entitled to a portion of the principal amount of Notes represented by
a Regulation S Temporary Global Note issued under the above-referenced Indenture, that as of the
date hereof, $___principal amount of Notes represented by the Regulation S Temporary Global Note
being submitted herewith for exchange is beneficially owned by persons that are either (i) non-U.S.
persons (within the meaning of Regulation S under the Securities Act of 1933, as amended) or (ii)
U.S. persons that purchased the Notes in a transaction that did not require registration under the
Securities Act of 1933, as amended.

          We further certify that (i) we are not submitting herewith for exchange any portion of such
Regulation S Temporary Global Note excepted in such Member Organization certifications and (ii) as
of the date hereof we have not received any notification from any Member Organization to the effect
that the statements made by such Member Organization with respect to any portion of such Regulation
S Temporary Global Note submitted herewith for exchange are no longer true and cannot be relied
upon as of the date hereof.

          You and the Issuer are entitled to rely upon this Certificate and are irrevocably authorized
to produce this Certificate or a copy hereof to any interested party in any administrative or legal
proceeding or official inquiry with respect to the matters covered hereby.

H-3

 

	 	 	 	 	 	 	 
	 	 	Yours faithfully,	 	 
	 
	 	 	 	 	 	 
	 	 	[EUROCLEAR BANK S.A./N.V., as 

     operator of the Euroclear System]	 	 
	 
	 	 	 	 	 	 
	 	 	OR
	 	 
	 
	 	 	 	 	 	 
	 	 	[CLEARSTREAM BANKING, société anonyme]	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	Name:	 	 
	 

	 	 	 	Title:	 	 
	 

	 	 	 	Address:	 	 

Date:                                        

H-4

 

EXHIBIT I

THIS SECURITY IS A TEMPORARY GLOBAL NOTE. PRIOR TO THE EXPIRATION OF THE RESTRICTED PERIOD
APPLICABLE HERETO, BENEFICIAL INTERESTS HEREIN MAY NOT BE HELD BY ANY PERSON OTHER THAN (1) A
NON-U.S. PERSON OR (2) A U.S. PERSON THAT PURCHASED SUCH INTEREST IN A TRANSACTION EXEMPT FROM
REGISTRATION UNDER THE U.S. SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”). BENEFICIAL
INTERESTS HEREIN ARE NOT EXCHANGEABLE FOR CERTIFICATED SECURITIES OTHER THAN A PERMANENT GLOBAL
NOTE IN ACCORDANCE WITH THE TERMS OF THE INDENTURE. TERMS IN THIS LEGEND ARE USED AS USED IN
REGULATION S UNDER THE SECURITIES ACT.

I-1

 

EXHIBIT J

UNRESTRICTED SUBSIDIARIES

WINDWARD HOME MORTGAGE, LLC

77 HUDSON STREET JOINT DEVELOPMENT, L.L.C.

COBBLESTONE SQUARE DEVELOPMENT, LLC

HERITAGE PINES, LLC

HOVSTONE HOLDINGS, L.L.C.

HOVSTONE PROPERTIES FLORIDA, L.L.C.

HOVSTONE PROPERTIES ILLINOIS, L.L.C.

HOVSTONE PROPERTIES MINNESOTA, L.L.C.

JAEGER ROAD 530, LLC

K. HOVNANIAN 77 HUDSON STREET INVESTMENTS, L.L.C.

K. HOVNANIAN AT 77 HUDSON STREET URBAN RENEWAL COMPANY, L.L.C.

K. HOVNANIAN AT MANALAPAN II, L.L.C.

K. HOVNANIAN AT PHILADELPHIA I, L.L.C.

K. HOVNANIAN AT PORT IMPERIAL URBAN RENEWAL II, L.L.C.

K. HOVNANIAN AT PORT IMPERIAL URBAN RENEWAL III, L.L.C.

K. HOVNANIAN AT TRENTON II, L.L.C.

K. HOVNANIAN AT TRENTON URBAN RENEWAL, L.L.C.

K. HOVNANIAN INVESTMENTS, L.L.C.

K. HOVNANIAN AT MANALAPAN INVESTMENT, L.L.C.

K. HOVNANIAN JV HOLDINGS, L.L.C.

K. HOVNANIAN POLAND, SP. Z.O.O.

LAUREL HIGHLANDS, LLC

M&M AT MONROE WOODS, L.L.C.

MILLENNIUM TITLE AGENCY, LTD.

MM-BEACHFRONT NORTH I, L.L.C.

MM-BEACHFRONT NORTH II, L.L.C.

MSHOV HOLDING COMPANY, L.L.C.

NORTH MANATEE, L.L.C.

OLD CITY DELAWARE, LLC

OLD CITY DEVELOPMENT, INC.

OLD CITY JOINT DEVELOPMENT, L.L.C.

PI INVESTMENTS I, LLC

RR HOUSTON DEVELOPERS, LLC

RR HOUSTON INVESTORS, LLC

THOMPSON RANCH JOINT DEVELOPMENT, LLC

WHI-REPUBLIC, LLC

WRIGHT FARM, L.L.C.

PRESTON PARKER, LLC

RR HOUSTON DEVELOPMENT, L.P.

RR HOUSTON INVESTMENT, L.P.

12TH* STREET RESIDENTIAL, LTD.

BRIGHTBEACH DEVELOPMENT, LTD.

BRIGHTCHASE, LTD.

BRIGHTON HOMES AT WALDEN MANAGEMENT, L.L.C.

BRIGHTON HOMES AT WALDEN, LTD.

FIRST MORTGAGE LENDERS OF FLORIDA, LLC

HEXTER-FAIR LAND TITLE COMPANY I, INC.

K. HOVNANIAN AMERICAN MORTGAGE, L.L.C.

J-1

 

K. HOVNANIAN MORTGAGE FUNDING, LLC

NEW HOMEBUYERS TITLE CO. (VIRGINIA) LLC

PRESTON GRANDE HOMES, INC.

TOWN HOMES AT MONTGOMERY, L.L.C.

WOODMORE RESIDENTIAL, L.L.C.

WTC VENTURES, L.L.C.

J-2

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