Document:

Exhibit
10.01

EMPLOYMENT
AGREEMENT

THIS EMPLOYMENT AGREEMENT (this “Agreement”) is
made effective as of the 1st day of May, 2007 (the “Effective Date”) by and
between BEAZER HOMES USA, INC., a Delaware corporation (the “Company”), and
ALLAN MERRILL, an individual resident of the State of California (“Executive”).

WITNESSETH:

WHEREAS, the
Company wishes to employ the Executive, and the Executive wishes to accept
employment with the Company, on the terms and conditions set forth herein.

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

1.             Employment and Duties.

(a)           The Company hereby
agrees to employ Executive for the Term (as hereinafter defined) as its
Executive Vice President and Chief Financial Officer. If requested by the Board of Directors of the Company (the “Board”),
Executive shall also serve on the Board without additional compensation.  Executive shall also serve, if requested by
the Board, as an executive officer and/or director of any subsidiaries and/or
affiliated companies and shall comply with the policy of the Compensation
Committee of the Board (the “Compensation Committee”) with regard to retention
or forfeiture of any director’s fees. As used in this Agreement, the
term “affiliated companies” shall include any company controlled by,
controlling or under common control with the Company.

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

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

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

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

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(f)            Executive warrants and
represents that, on the date hereof, he is not a party to, and will not as of
the Effective Date be a party to, or subject to, any other employment,
non-competition, joint venture, partnership or other agreement or restriction
that would be violated by his employment with the Company or his or the Company’s
rights and obligations hereunder; and that his employment and the performance
of his duties hereunder will not breach the provisions of any contract,
agreement, or understanding to which he is party or bound or any duty owed by
him to any other person.  Executive
agrees that he will not hereafter become a party to or be bound by any such
conflicting agreement.

2.             Employment Term.   The term of Executive’s employment hereunder
(the “Term”) shall commence effective as of the date hereof and shall end on
April 30, 2009, unless sooner terminated as provided herein; provided, however;
that the Term shall automatically be extended for successive one year periods
unless: (i) this Agreement is terminated as otherwise provided herein; or (ii)
Executive or the Company provides written notice to the other of such party’s
desire not to extend the Term at least sixty (60) days prior to the scheduled
expiration of the Term as then in effect.

3.             Compensation and Benefits

(a)           Base Salary.  During the Term, the Executive shall receive
an annual base salary (“Annual Base Salary”) in the amount of $600,000.00,
payable in accordance with the Company’s normal payroll practices (but not less
frequently than monthly). During the Term, the Annual Base Salary shall be
reviewed by the Compensation Committee (for purposes of increase only) at least
annually. Any increase in Annual Base Salary shall not serve to limit or reduce
any other obligation to the Executive under this Agreement. Annual Base Salary
shall not be reduced after any such increase and the term Annual Base Salary as
utilized in this Agreement shall refer to Annual Base Salary as so increased.
Notwithstanding anything contained herein to the contrary, in the event that
the Company shall implement a Company-wide reduction in executive base
compensation, then, solely for such purpose and only during the continuation of
such Company-wide reduction, the Company shall have the right to reduce the
Annual Base Salary then payable hereunder in a manner that is consistent with
said Company-wide reduction.

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

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

(d)           Welfare Benefit Plans. During the Term,
the Executive and/or the Executive’s family, as the case may be, shall be
eligible for participation in and shall receive all benefits under welfare
benefit plans, practices, policies and programs provided by the Company and its
affiliated companies (including, without limitation, medical, prescription,
dental, disability, employee life, group life, accidental death and travel
accident insurance plans and programs) to the extent applicable generally to
other most senior executives of the Company and its affiliated companies.

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

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

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

4.             Termination of Employment.

(a)           Death or Disability. The Executive’s
employment shall terminate automatically upon the Executive’s death during the
Term. If the Disability of the Executive occurs during the Term (pursuant to
the definition of Disability set forth below), the Company may give to the
Executive written notice in accordance with Section 10(c) of this Agreement of
its intention to terminate the Executive’s employment. In such event, the
Executive’s employment with the Company shall terminate effective on the 30th
day after receipt of such notice by the Executive (the “Disability Effective
Date”), provided that, within the 30 days after such receipt, the Executive
shall not have returned to full-time performance of the Executive’s duties. For
purposes of this Agreement, “Disability” shall mean the absence of the
Executive from the Executive’s duties with the Company on a full-time basis for
120 consecutive business days as a result of incapacity due to mental or
physical illness which is determined to be total and permanent by a physician
selected by the Company or its insurers and acceptable to the Executive or the
Executive’s legal representative.

(b)           Cause. The Company may terminate the
Executive’s employment for Cause. For purposes of this Agreement, “Cause” shall
mean:

(i)                                     any
act or failure to act by Executive done with the intent to harm in any material
respect the financial interests or reputation of the Company or any affiliated
companies;

(ii)                                  Executive
being convicted of (or entering a plea of guilty or nolo contendere to) a felony (other than a felony involving
a motor vehicle);

(iii)                               Executive’s dishonesty, misappropriation or fraud with regard to the
Company or any affiliated companies (other than good faith expense account
disputes);

(iv)                              a
grossly negligent act or failure to act by Executive which has a material
adverse affect on the Company or any affiliated companies;

(v)                                 the
material breach by Executive of his agreements or obligations under this
Agreement which has a material adverse effect on the Company, which breach, if
curable, is not cured by Executive within fifteen (15) days after written
notice from the Company which specifically identifies the material breach which
the Company believes that Executive has committed; or

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

(c)           Notice of Termination.  Any termination by the Company for Cause
shall be communicated by Notice of Termination to the Executive given in
accordance with Section 10(c) of this 

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Agreement. For purposes
of this Agreement, a “Notice of Termination” means a written notice which (i)
indicates the specific termination provision in this Agreement relied upon,
(ii) to the extent applicable, sets forth in reasonable detail the facts and
circumstances claimed to provide a basis for termination of the Executive’s
employment under the provision so indicated and (iii) if the Date of
Termination (as defined below) is other than the date of receipt of such
notice, specifies the termination date (which date shall be not more than
thirty days after the giving of such notice). The failure by the Company to set
forth in the Notice of Termination any fact or circumstance which contributes
to a showing of Cause shall not waive any right of the Company hereunder or preclude
the Company from asserting such fact or circumstance in enforcing the Company’s
rights hereunder.

(d)           Date of Termination. “Date of
Termination” means (i) if the Executive’s employment is terminated by the
Company for Cause, the date of receipt of the Notice of Termination or, subject
to applicable cure periods, any later date specified therein, as the case may
be, (ii) if the Executive’s employment is terminated by the Company other than
for Cause or Disability, the Date of Termination shall be the date on which the
Company notifies the Executive of such termination and (iii) if the Executive’s
employment is terminated by reason of death or Disability, the Date of
Termination shall be the date of death of the Executive or the Disability
Effective Date, as the case may be.

5.                                       Intentionally Omitted.

6.             Obligations of the Company upon Termination.

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

(i)            the
Company shall pay to the Executive in a lump sum in cash within 30 days after
the Date of Termination the aggregate of the following amounts: (1) the
Executive’s Annual Base Salary through the Date of Termination to the extent
not theretofore paid, (2)  any accrued
but unpaid annual bonus (“Annual Bonus”) respecting any completed fiscal year
ending prior to the Date of Termination, (3) the product of (x) the Average
Annual Bonus (hereinafter defined) and (y) a fraction, the numerator of which
is the number of days in the current fiscal year through the Date of
Termination, and the denominator of which is 365 and (4) any compensation
previously deferred by the Executive (together with any accrued interest or
earnings thereon) and any accrued vacation pay, in each case to the extent not
theretofore paid (the sum of the amounts described in clauses (1), (2), (3) and
(4) shall be hereinafter referred to as the “Accrued Obligations”). Anything
contained herein to the contrary notwithstanding, the timing of payment by the
Company of any deferred compensation shall remain subject to the terms and
conditions of the applicable deferred compensation plan and any payment
election previously made by the Executive. 
The term “Average Annual Bonus” shall mean the arithmetic average of the
Executive’s bonuses (whether paid or deferred) under the Company’s annual
incentive plans during the last three full fiscal years prior to the Date of
Termination or for such lesser period as the Executive has been employed by the
Company (annualized in the event that the Executive was not employed by the
Company for the whole of any such fiscal year). 
Without limiting the generality of the foregoing definition, the “Average
Annual Bonus” shall include the following components, if any, pursuant to the
Company’s EVCIP Rules (or
any successor incentive plan, for so long as any of same shall exist):

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

(b)         Any excess in the Bank
discounted at 75% of face value (which shall, for purposes hereof, be deemed to
be fully vested);

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

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

Notwithstanding the foregoing and any amounts actually
paid with respect to the fiscal year ending September 30, 2007, solely for
purposes of calculating the Average Annual Bonus, the Annual Bonus for said
fiscal year shall be deemed to be an amount equal to two times the Executive’s
Annual Base Salary.

(ii)                                  so
long as the Executive is and remains in compliance in all material respects
with his obligations under Section 7 below, the Company shall pay to the
Executive an amount equal to the sum of (1) Executive’s Annual Base Salary (at
the rate in effect on the Date of Termination), and (2) the Average Annual
Bonus for a period of two years from the Date of Termination, (the “Severance
Period”), at the same time that payments of Annual Base Salary would otherwise
have become due and payable during said period in the absence of such
termination;

(iii)                               so long as the Executive
is and remains in compliance in all material respects with his obligations
under Section 7 below, during the Severance Period, or such longer period as
may be provided by the terms of the appropriate plan, program, practice or
policy, the Company shall continue benefits to the Executive and/or the
Executive’s family at least equal to those which would have been provided to
them in accordance with the plans, programs, practices and policies described
in Section 3(d) of this Agreement if the Executive’s employment had not been
terminated, provided, however, that if the Executive becomes reemployed with
another employer and receives medical or other welfare benefits under another
employer provided plan, the medical and other welfare benefits described herein
shall cease; and

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

(b)           Death. If the Executive’s employment is
terminated by reason of the Executive’s death, this Agreement shall terminate
without further obligations to the Executive’s legal representatives under this
Agreement, other than for payment of Accrued Obligations and the timely payment
or provision of Other Benefits. Accrued Obligations shall be paid to the
Executive’s estate or beneficiary, as applicable, in a lump sum in cash within
30 days of the Date of Termination.

(c)           Disability. If the Executive’s
employment is terminated by reason of the Executive’s Disability, this
Agreement shall terminate without further obligations to the Executive, other
than for payment of Accrued Obligations and the timely payment or provision of
Other Benefits. Accrued Obligations shall be paid to the Executive or the
Executive’s legal representative in a lump sum in cash within 30 days of the
Date of Termination.

(d)           Cause; Voluntary Termination. If the
Executive’s employment shall be terminated for Cause, this Agreement shall
terminate without further obligations to the Executive other than the
obligation to pay to the Executive (x) his Annual Base Salary through the Date
of Termination, (y) the amount of any compensation previously deferred by the
Executive, and (z) Other Benefits, in each case 

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to the extent theretofore
unpaid. If the Executive voluntarily terminates employment during the Term,
this Agreement shall terminate without further obligations to the Executive,
other than for Accrued Obligations and the timely payment or provision of Other
Benefits. In such case, all Accrued Obligations shall be paid to the Executive
in a lump sum in cash within 30 days of the Date of Termination.

(e)           Election Not to Extend.  In the event that the Company elects,
pursuant to Section 2 above, not to extend the Term, then, such election shall
be treated for all purposes hereof the same as the termination by the Company
of Executive’s employment for other than Cause, and, in such case, commencing
upon the date of the expiration of the Term, Executive shall be entitled to
receive from the Company the same payments and benefits as Executive would be
entitled to receive pursuant to Section 6(a) above; provided, however, and
notwithstanding anything contained in Section 6(a) above to the contrary, in
connection with an election by the Company not to renew the Term, the
applicable “Severance Period” shall not extend beyond the date that the
Executive reaches the age of sixty-five (65).

(f)            Effect of
Reduction in Duties and Material Breach by Company.  For
purposes of this Agreement and any equity-based compensation awards held by the
Executive, a termination of employment by the Executive within thirty (30) days
following the occurrence, without Executive’s consent, of any of the following
events, provided the event is not cured by the Company within fifteen (15) days
after written notice by Executive specifying the event, will be treated as a
termination of the Executive’s employment by the Company other than for Cause:
(i) a material reduction by the Company of Executive’s duties,
responsibilities, authority or reporting relationship such that Executive no
longer serves in a senior executive role for the Company comparable in stature
to Executive’s current role, or no longer reports to the chief executive officer
of the Company; or (ii) a material breach by the Company of the terms of this
Agreement.

7.             Employment Covenants.

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

(i)            Engage
in or carry on any business or in any way become associated with any business
in the Restricted Area (as hereinafter defined) which is similar to or is in
competition with the Business of the Company (as hereinafter defined). As used
in this Section 7(a), the term (1) “Business of the Company” shall mean and
include all business activities in which the Company and/or any affiliated
companies have engaged (or have prepared written plans to engage) at any time
during the Term, including but not limited to, the purchase of land (or options
therefor) for development and the construction of residential homes for resale
to consumers, and (2) “Restricted Area” shall mean and include anywhere in the
United States of America or in any foreign country in which the Company or any
affiliated companies then engage (or have within the preceding three years
engaged) in business;

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

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

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

(v)           Be or
become a shareholder, joint venturer, owner (in whole or in part), or partner,
or be or become associated with or have any proprietary or financial interest
in or of any firm, corporation, association or other entity which is engaged in
or is carrying on any business which is similar to or in competition with the
Business of the Company in the Restricted Area (a “Competing Entity”).
Notwithstanding the preceding sentence, (A) passive equity investments by
Executive of $100,000 or less in any Competing Entity, or (B) investments, in
any amount, in any publicly traded mutual fund, index fund or similar
investment vehicle which fund or investment vehicle owns any proprietary or
financial interest in any Competing Entity, shall not be deemed to violate this
Section 7(a)(v).

For purposes of identifying the Restricted Area,
Executive hereby recognizes and acknowledges that the existing Business of the
Company currently extends throughout the States of Georgia, Tennessee, South
Carolina, North Carolina, California, Arizona, Nevada, Florida, New Jersey,
Delaware, Maryland, Virginia, West Virginia, Texas, New York, Colorado, Mississippi,
Indiana, Kentucky, Ohio, Pennsylvania, Washington, D.C., West Virginia and New
Mexico.  Executive further warrants and
represents that, because of his varied skill and abilities, he does not need to
compete with the Business of the Company and that this Agreement will not
prevent him from earning a livelihood and acknowledges that the restrictions
contained in this Section 7 constitute reasonable protections for the Company.

As used in this
Section 7, “Applicable Non-Compete Period” shall mean the following:

(A)                              at
all times that the Executive is employed by the Company; and

(B)                                for
a period of time after the Executive’s employment under this Agreement is
terminated for any reason equal to the greater of

(i)                                     180
days; or

(ii)        such
longer period of time that the Executive is entitled to receive payments under
Sections 6(a)(ii) or (iii) above (it being agreed that the Executive shall have
the right to terminate the period referred to in this clause (ii) by waiving in
writing the right to receive any further payments under Sections 6(a)(ii) or
(iii) above).

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

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the information is
confidential or by treating the information in such a manner that the Executive
should reasonably believe it to be deemed confidential by the Company.  “General Knowledge” shall mean (i) general
skills or experience gained during Executive’s employment with, consultation
for or work for the Company; and (ii) information and data publicly available.

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

(d)           Breach. Executive hereby recognizes and
acknowledges that irreparable injury or damage shall result to the Company in
the event of a breach or threatened breach by Executive of any of the terms or
provisions of this Section 7, and Executive therefore agrees that the Company
shall be entitled to an injunction restraining Executive from engaging in any
activity constituting such breach or threatened breach. Nothing contained
herein shall be construed as prohibiting the Company from pursuing any other
remedies available to the Company at law or in equity for such breach or
threatened breach, including but not limited to, the recovery of damages from
Executive and, if Executive is an employee of the Company, the termination of
his employment with the Company in accordance with the terms and provisions of
this Agreement.

(e)           Survival.  Notwithstanding the termination of the
employment of Executive or the termination of this Agreement, the provisions of
this Section 7 shall survive and be binding upon Executive unless a written
agreement which specifically refers to the termination of the obligations and
covenants of this Section 7 is executed by the Company.  Notwithstanding the foregoing, this Section 7
shall not survive the termination of this Agreement as the result of the Change
Of Control Agreement (hereinafter defined) becoming effective.

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

8.             No
Mitigation. In no event shall the Executive be obligated to seek
other employment or take any other action by way of mitigation of the amounts
payable to the Executive under any of the provisions of this Agreement and such
amounts shall not be reduced whether or not the Executive obtains other
employment. The Company agrees to pay as incurred, to the full extent permitted
by law, all legal fees and expenses which the Executive may reasonably incur as
a result of any contest by (i) the Company, provided that the Executive
prevails in at least one material issue, (ii) the Executive or (iii) others, of
the validity or enforceability of, or liability under, any provision of this
Agreement or any guarantee of performance thereof (including, without
limitation, as a result of any contest by the Executive about the amount of any
payment pursuant to this Agreement), plus in each case interest on any delayed
payment at the applicable Federal rate provided for in Section 7872(f) (2) (A)
of the Internal Revenue Code of 1986, as amended (the “Code”).

9.             Successors.

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

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

10.           Miscellaneous.

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

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

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

If to the Executive:

5732 White Cloud Circle

Westlake Village, California 91362

If to the Company:

1000 Abernathy Road

Suite 1200

Atlanta, Georgia 30328

Attention:
President and Chief Executive Officer

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

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

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

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

(g)           This Agreement
supersedes any and all other prior or contemporaneous agreements, either oral
or in writing, between the parties hereto with respect to the subject matter
hereof, and this 

 9
 

Agreement contains all of
the covenants and agreements between the parties with respect to employment of
Executive by the Company.

Reference
is hereby made to that certain Change of Control Employment Agreement dated as
of May 1, 2007 (the “Change of Control Agreement”) by and between the Company
and the Executive.  Notwithstanding
anything contained herein to the contrary, (i) this Agreement shall not
supersede the Change of Control Agreement, and (ii) upon the “Effective Date”
occurring under the Change of Control Agreement, this Agreement shall be
superseded by the Change of Control Agreement.

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

11.           Special Provisions Re Section 409A of the Internal
Revenue Code.  It is intended that this Agreement
will comply with Section 409A of the Code (and any regulations and any  guidelines issued thereunder) to the extent
the Agreement is subject thereto, and the Agreement shall be interpreted on a
basis consistent with such intent.  If it
is determined that an amendment of this Agreement is necessary in order for it
to comply with Section 409A, the parties agree to negotiate in good faith to
amend this Agreement in a manner that preserves the original intent of the
parties to the extent reasonably possible. 
Notwithstanding any provision to the contrary in this Agreement, in the
event that any payments or benefits required to be provide by the Company
hereunder are deemed to constitute payments of “nonqualified deferred
compensation” that is subject to the requirements of Section 409A and if the
Executive is deemed on the Date of Termination to be a “specified employee”
within the meaning of that term under Section 409A(a)(2)(B) of the Code, then
with regard to any payment or the provisions of any benefit that is required to
be delayed pursuant to Section 409A(a)(2)(B) of the Code, such payment or
benefit shall not be made or provided prior to the earlier of (i) the
expiration of the six (6)-month period measured from the date of his “separation
from service” (as such term is defined in Treasury Regulations issued under
Section 409A), or (ii) the date of his death (the “Delay Period”).  Upon the expiration of the Delay Period, all
payments and benefits delayed pursuant to this Section 11 (whether they would
have otherwise been payable in a single sum or in installments in the absence
of such delay) shall be paid or reimbursed to the Executive in a lump sum, and
any remaining payments and benefits due under this Agreement shall be paid or
provided in accordance with the normal payment dates specified for them
herein.  Notwithstanding the foregoing,
to the extent that the foregoing applies to the provision of any ongoing
welfare benefits to the Executive that would not be required to be delayed if
the premiums therefor were paid by the Executive, the Executive shall pay the
full costs of premiums for such welfare benefits during the Delay Period and
the Company shall pay the Executive an amount equal to the amount of such
premiums paid by the Executive during the Delay Period promptly after its
conclusion.

 10
 

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

	
   

  	
  BEAZER HOMES USA, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
  Name: Ian J. McCarthy

  
	
   

  	
  Title: President and Chief Executive Officer

  
	
   

  	
   

  
	
   

  	
  EXECUTIVE

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  ALLAN MERRILL

  

 

 11Exhibit
10.02

CHANGE
OF CONTROL EMPLOYMENT AGREEMENT

AGREEMENT by and
between Beazer Homes USA, Inc., a Delaware corporation (the “Company”) and
ALLAN MERRILL (the “Executive”), dated as of the 1st day of May, 2007.

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

NOW, THEREFORE, IT
IS HEREBY AGREED AS FOLLOWS:

1.             Certain
Definitions.

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

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

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

(a)           The
acquisition by any individual, entity or group (within the meaning of Section
13(d)(3) or 14(d)(2) of the Securities Exchange Act of 1934, as amended (the “Exchange
Act”)) (a “Person”) of beneficial ownership (within the meaning of Rule 13d-3
promulgated under the Exchange Act) of 25% or more of either (i) the then
outstanding shares of common stock of the Company (the “Outstanding Company
Common Stock”) or (ii) the combined voting power of the then outstanding voting
securities of the Company entitled to vote generally in the election of
directors (the “Outstanding Company Voting Securities”); provided, however,
that for purposes of this subsection (a), the following acquisitions shall not
constitute a Change of Control: (i) any acquisition directly from the Company,
(ii) any acquisition by the Company, (iii) any acquisition by any employee
benefit plan (or related trust) sponsored or maintained by the Company or any
corporation controlled by the Company or (iv) any acquisition by any
corporation pursuant to a transaction which complies with clauses (i), (ii) and
(iii) of subsection (c) of this Section 2; or

(b)           Individuals who, as of
the date hereof, constitute the Board (the “Incumbent Board”) cease for any
reason to constitute at least a majority of the Board; provided, however, that
any individual becoming a director subsequent to the date hereof whose
election, or nomination for election by the 

 1
 

Company’s shareholders,
was approved by a vote of at least a majority of the directors then comprising
the Incumbent Board shall be considered as though such individual were a member
of the Incumbent Board, but excluding, for this purpose, any such individual
whose initial assumption of office occurs as a result of an actual or
threatened election contest with respect to the election or removal of
directors or other actual or threatened solicitation of proxies or consents by
or on behalf of a Person other than the Board; or

(c)           Consummation of a
reorganization, merger or consolidation or sale or other disposition of all or
substantially all of the assets of the Company (a “Business Combination”), in
each case, unless, following such Business Combination, (i) all or
substantially all of the individuals and entities who were the beneficial
owners, respectively, of the Outstanding Company Common Stock and Outstanding
Company Voting Securities immediately prior to such Business Combination
beneficially own, directly or indirectly, more than 50% of, respectively, the
then outstanding shares of common stock and the combined voting power of the
then outstanding voting securities entitled to vote generally in the election
of directors, as the case may be, of the corporation resulting from such
Business Combination (including, without limitation, a corporation which as a
result of such transaction owns the Company or all or substantially all of the
Company’s assets either directly or through one or more subsidiaries) in
substantially the same proportions as their ownership, immediately prior to
such Business Combination of the Outstanding Company Common Stock and
Outstanding Company Voting Securities, as the case may be, (ii) no Person
(excluding any corporation resulting from such Business Combination or any
employee benefit plan (or related trust) of the Company or such corporation
resulting from such Business Combination) beneficially owns, directly or
indirectly, 20% or more of, respectively, the then outstanding shares of common
stock of the corporation resulting from such Business Combination or the
combined voting power of the then outstanding voting securities of such
corporation except to the extent that such ownership existed prior to the
Business Combination and (iii) at least a majority of the members of the board
of directors of the corporation resulting from such Business Combination were
members of the Incumbent Board at the time of the execution of the initial
agreement, or of the action of the Board, providing for such Business
Combination; or

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

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

4.             Terms of
Employment.

(a)           Position
and Duties.

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

(ii) During the Employment Period, and excluding any periods of
vacation and sick leave to which the Executive is entitled, the Executive
agrees to devote reasonable attention and time during normal business hours to
the business and affairs of the Company and, to the extent necessary to
discharge the responsibilities assigned to the Executive hereunder, to use the
Executive’s reasonable best efforts to perform faithfully such
responsibilities. During the Employment Period it shall not be a violation of
this Agreement for the Executive to (A) serve on corporate, civic or charitable
boards or 

 2
 

committees, (B) deliver lectures, fulfill speaking engagements or teach
at educational institutions and (C) manage personal investments, so long as
such activities do not significantly interfere with the performance of the
Executive’s responsibilities as an employee of the Company in accordance with
this Agreement. It is expressly understood and agreed that to the extent that
any such activities have been conducted by the Executive prior to the Effective
Date, the continued conduct of such activities (or the conduct of activities
similar in nature and scope thereto) subsequent to the Effective Date shall not
thereafter be deemed to interfere with the performance of the Executive’s
responsibilities to the Company.

(b)           Compensation.

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

(ii)           Annual
Bonus. In addition to Annual Base Salary, the Executive shall be awarded,
for each fiscal year ending during the Employment Period, an annual bonus (the “Annual
Bonus”) in cash at least equal to the arithmetic average of the Executive’s
bonuses (whether paid or deferred) under the Company’s or its predecessor’s
annual incentive plans during the last three full fiscal years prior to the
Effective Date or for such lesser period as the Executive has been employed by
the Company or its predecessor (annualized in the event that the Executive was
not employed by the Company for the whole of any such fiscal year), (the “Average
Annual Bonus”).  Each such Annual Bonus
shall be paid no later than the end of the third month of the fiscal year next
following the fiscal year for which the Annual Bonus is awarded, unless the
Executive shall elect to defer the receipt of such Annual Bonus. Without
limiting the generality of the foregoing definition, the “Average Annual Bonus”
shall include the following components, if any, pursuant to the Company’s
Amended and Restated EVCIP Rules (or
any successor incentive plan, for so long as any of same shall exist):

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

(b)         Any excess in the Bank
discounted at 75% of face value (which shall, for purposes hereof, be deemed to
be fully vested);

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

(d)  Any
deferred bonus under the EVCIP which is invested in stock under the Company’s
Corporate Management Stock Purchase Program, at full face 

 3
 

value of said bonus (which shall, for purposes hereof,
be deemed to be fully vested);

Notwithstanding the foregoing and any amounts actually
paid with respect to the fiscal year ending September 30, 2007, solely for
purposes of calculating the Average Annual Bonus and the Highest Annual Bonus
(as hereinafter defined), the Annual Bonus for said fiscal year shall be deemed
to be an amount equal two times the Executive’s Annual Base Salary.

(iii)          Incentive,
Savings and Retirement Plans. During the Employment Period, the Executive
shall be entitled to participate in all incentive, savings and retirement
plans, practices, policies and programs applicable generally to other most
senior  executives of the Company
and its affiliated companies, but in no event shall such plans, practices,
policies and programs provide the Executive with incentive opportunities
(measured with respect to both regular and special incentive opportunities, to
the extent, if any, that such distinction is applicable), savings opportunities
and retirement benefit opportunities, in each case, less favorable, in the
aggregate, than the most favorable of those provided by the Company and its
affiliated companies for the Executive under such plans, practices, policies
and programs as in effect at any time during the 120-day period immediately
preceding the Effective Date or if more favorable to the Executive, those
provided generally at any time after the Effective Date to other peer
executives of the Company and its affiliated companies.

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

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

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

(vii)         Office
and Support Staff. During the Employment Period, the Executive shall be
entitled to an office or offices of a size and with furnishings and other
appointments, and 

 4
 

to exclusive personal secretarial and other assistance, at least equal
to the most favorable of the foregoing provided to the Executive by the Company
and its affiliated companies at any time during the 120 day period immediately
preceding the Effective Date or, if more favorable to the Executive, as
provided generally at any time thereafter with respect to other peer executives
of the Company and its affiliated companies.

(viii)        Vacation.
During the Employment Period, the Executive shall be entitled to paid vacation
in accordance with the most favorable plans, policies, programs and practices
of the Company and its affiliated companies as in effect for the Executive at
any time during the 120 day period immediately preceding the Effective Date or,
if more favorable to the Executive, as in effect generally at any time
thereafter with respect to other peer executives of the Company and its
affiliated companies.

5.             Termination of
Employment.

(a)           Death or Disability.
The Executive’s employment shall terminate automatically upon the Executive’s
death during the Employment Period. If the Disability of the Executive occurs
during the Employment Period (pursuant to the definition of Disability set
forth below), the Company may give to the Executive written notice in
accordance with Section 13(c) of this Agreement of its intention to terminate
the Executive’s employment. In such event, the Executive’s employment with the
Company shall terminate effective on the 30th day after receipt of such notice
by the Executive (the “Disability Effective Date”), provided that, within the
30 days after such receipt, the Executive shall not have returned to full-time
performance of the Executive’s duties. For purposes of this Agreement, “Disability”
shall mean the absence of the Executive from the Executive’s duties with the
Company on a full-time basis for 180 consecutive business days as a result of
incapacity due to mental or physical illness which is determined to be total
and permanent by a physician selected by the Company or its insurers and
acceptable to the Executive or the Executive’s legal representative.

(b)           Cause. The
Company may terminate the Executive’s employment for Cause. For purposes of
this Agreement, “Cause” shall mean:

(i)            the willful
and continued failure of the Executive to perform substantially the Executive’s
duties with the Company or one of its affiliates (other than any such failure
resulting from incapacity due to physical or mental illness), for more than 15
days after a written demand for substantial performance is delivered to the
Executive by the Board or the Chief Executive Officer of the Company which
specifically identifies the manner in which the Board or Chief Executive
Officer believes that the Executive has not substantially performed the
Executive’s duties, or

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

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

 5
 

(c)           Good Reason. The
Executive’s employment may be terminated by the Executive for Good Reason. For
purposes of this Agreement, “Good Reason” shall mean:

(i)            the
assignment to the Executive of any duties inconsistent in any respect with the
Executive’s position (including status, offices, titles and reporting
requirements), authority, duties or responsibilities as contemplated by Section
4(a) of this Agreement, or any other action by the Company which results in a
diminution in such position, authority, duties or responsibilities, excluding
for this purpose an isolated, insubstantial and inadvertent action not taken in
bad faith and which is remedied by the Company within 15 days after receipt of
notice thereof given by the Executive;

(ii)           any
failure by the Company to comply with any of the provisions of Section 4(b) of
this Agreement, other than an isolated, insubstantial and inadvertent failure
not occurring in bad faith and which is remedied by the Company within 15 days
after receipt of notice thereof given by the Executive;

(iii)          the
Company’s requiring the Executive to be based at any office or location other
than as provided in Section 4(a)(i)(B) hereof or the Company’s requiring the
Executive to travel on Company business to a substantially greater extent than
required immediately prior to the Effective Date, which is not remedied by the
Company within 15 days after receipt of notice thereof given by the Executive;

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

(v)           any
failure by the Company to comply with and satisfy Section 11(c) of this
Agreement, which is not remedied by the Company within 15 days after receipt of
notice thereof given by the Executive.

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

(d)           Notice of
Termination.  Any termination of the
Executive’s employment by the Company or by the Executive shall be communicated
by Notice of Termination to the other party hereto given in accordance with
Section 13(c) of this Agreement. For purposes of this Agreement, a “Notice of
Termination” means a written notice which (i) indicates the specific
termination provision in this Agreement relied upon, (ii) to the extent
applicable, sets forth in reasonable detail the facts and circumstances claimed
to provide a basis for termination of the Executive’s employment under the
provision so indicated and (iii) if the Date of Termination (as defined below)
is other than the date of receipt of such notice, specifies the termination
date (which date shall be not more than thirty days after the giving of such
notice). The failure by the Executive or the Company to set forth in the Notice
of Termination any fact or circumstance which contributes to a showing of Good
Reason or Cause shall not waive any right of the Executive or the Company,
respectively, hereunder or preclude the Executive or the Company, respectively,
from asserting such fact or circumstance in enforcing the Executive’s or the
Company’s rights hereunder.

(e)           Date of Termination.
“Date of Termination” means (i) if the Executive’s employment is terminated by
the Company for Cause, or by the Executive for Good Reason, the date of receipt
of the Notice of Termination or, subject to applicable cure periods, any later
date specified therein, as the case may be, (ii) if the Executive’s employment
is terminated by the Company other than for Cause or Disability, the Date of
Termination shall be the date on which the Company notifies the Executive of
such termination and (iii) if the Executive’s employment is terminated by
reason of death or Disability, the Date

 6
 

of Termination shall be
the date of death of the Executive or the Disability Effective Date, as the
case may be.

6.             Obligations of the
Company upon Termination.

(a)           Good Reason; Other
Than for Cause. If, during the Employment Period, the Company shall
terminate the Executive’s employment other than for Cause or the Executive
shall terminate employment for Good Reason (including, without limitation, a
Permitted Executive Termination):

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

A.            the sum of
(1) the Executive’s Annual Base Salary through the Date of Termination to the
extent not theretofore paid, (2)  any
accrued but unpaid Annual Bonus respecting any completed fiscal year ending
prior to the Date of Termination, (3) the product of (x) the Average Annual
Bonus and (y) a fraction, the numerator of which is the number of days in the
current fiscal year through the Date of Termination, and the denominator of
which is 365 and (4) any compensation previously deferred by the Executive
(together with any accrued interest or earnings thereon) and any accrued
vacation pay, in each case to the extent not theretofore paid (the sum of the
amounts described in clauses (1), (2), (3) and (4) shall be hereinafter referred
to as the “Accrued Obligations”). 
Anything contained herein to the contrary notwithstanding, the timing of
payment by the Company of any deferred compensation shall remain subject to the
terms and conditions of the applicable deferred compensation plan and any
payment election previously made by the Executive;
and

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

(ii)           for two (2)
years after the Executive’s Date of Termination, or such longer period as may
be provided by the terms of the appropriate plan, program, practice or policy,
the Company shall continue benefits to the Executive and/or the Executive’s
family at least equal to those which would have been provided to them in
accordance with the plans, programs, practices and policies described in
Section 4(b)(iv) of this Agreement if the Executive’s employment had not been
terminated or, if more favorable to the Executive, as in effect generally at
any time thereafter with respect to other peer executives of the Company and
its affiliated companies and their families, provided, however, that if the
Executive becomes reemployed with another employer and is eligible to receive medical
or other welfare benefits under another employer provided plan, the medical and
other welfare benefits described herein shall be secondary to those provided
under such other plan during such applicable period of eligibility. For
purposes of determining eligibility (but not the time of commencement of
benefits) of the Executive for retiree benefits pursuant to such plans,
practices, programs and policies, the Executive shall be considered to have
remained employed until two (2) years after the Date of Termination and to have
retired on the last day of such period;

(iii)          the
Company shall, at its sole expense as incurred, provide the Executive with
outplacement services in accordance with the Company’s policies with regard to
outplacement then in effect; and

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

 7
 

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

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

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

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

7.             Non-exclusivity of
Rights. Nothing in this Agreement shall prevent or limit the Executive’s
continuing or future participation in any plan, program, policy or practice
provided by the Company or any of its affiliated companies and for which the
Executive may qualify, nor, subject to Section 13(f), shall anything herein limit
or otherwise affect such rights as the Executive may have under any contract or
agreement with the Company or any of its affiliated companies. Amounts which
are vested benefits or which the Executive is otherwise entitled to receive
under any plan, policy, practice or program of or any contract or agreement
with the Company or any of its affiliated companies at or subsequent to the
Date of Termination shall be payable in accordance with such plan, policy,
practice or program or contract or agreement except as explicitly modified by
this Agreement.

 8
 

8.             Full
Settlement. The Company’s obligation to make the payments provided for in
this Agreement and otherwise to perform its obligations hereunder shall not be
affected by any set-off, counterclaim, recoupment, defense or other claim,
right or action which the Company may have against the Executive or others.
Each and every payment made hereunder by the Company shall be final, and the
Company shall not seek to recover all or any part of such payment from the Executive
or from whomsoever may be entitled thereto, for any reasons whatsoever. In no
event shall the Executive be obligated to seek other employment or take any
other action by way of mitigation of the amounts payable to the Executive under
any of the provisions of this Agreement and such amounts shall not be reduced
whether or not the Executive obtains other employment. The Company agrees to
pay as incurred, to the full extent permitted by law, all legal fees and
expenses which the Executive may reasonably incur as a result of any contest by
(i) the Company, provided that the Executive prevails in at least one material
issue, (ii) the Executive or (iii) others, of the validity or enforceability
of, or liability under, any provision of this Agreement or any guarantee of
performance thereof (including, without limitation, as a result of any contest
by the Executive about the amount of any payment pursuant to this Agreement),
plus in each case interest on any delayed payment at the applicable Federal
rate provided for in Section 7872(f) (2) (A) of the Internal Revenue Code of
1986, as amended (the “Code”).

9.             Certain Additional
Payments by the Company.

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

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

 9
 

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

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

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

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

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

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

provided, however, that
the Company shall bear and pay directly all costs and expenses (including
additional interest and penalties) incurred in connection with such contest and
shall indemnify and hold the Executive harmless, on an after-tax basis, for any
Excise Tax or income tax (including interest and penalties with respect
thereto) imposed as a result of such representation and payment of costs and
expenses. Without limitation on the foregoing provisions of this Section 9(c),
the Company shall control all proceedings taken in connection with such contest
and, at its sole option, may pursue or forgo any and all administrative
appeals, proceedings, hearings and conferences with the taxing authority in
respect of such claim and may, at its sole option, either direct the Executive
to pay the tax claimed and sue for a refund or contest the claim in any
permissible manner, and the Executive agrees to prosecute such contest to a
determination before any administrative tribunal, in a court of initial
jurisdiction and in one or more appellate courts, as the Company shall
determine; provided, however, that if the Company directs the Executive to pay
such claim and sue for a refund, the Company shall advance the amount of such
payment to the Executive, on an interest-free basis and shall indemnify and
hold the Executive harmless, on an after-tax basis, from any Excise Tax or income
tax (including interest or penalties with respect thereto) imposed with respect
to such advance or with respect to any imputed income with respect to such
advance; and further provided that any extension of the statute of limitations
relating to payment of taxes for the taxable year of the Executive with respect
to which such contested amount is claimed to be due is limited solely to such
contested amount. Furthermore, the Company’s control of the contest shall be
limited to issues with respect to which a Gross-Up Payment would be payable
hereunder and the Executive shall be entitled to settle or contest, as the case
may be, any other issue raised by the Internal Revenue Service or any other
taxing authority.

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

 10
 

be
forgiven and shall not be required to be repaid and the amount of such advance
shall offset, to the extent thereof, the amount of Gross-Up Payment required to
be paid.

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

11.           Successors.

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

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

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

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

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

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

 11
 

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

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

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

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

As
used in this Section 12, the “Non-Compete Period” shall mean for a period of
one (1) year after the date of the termination of Executive’s employment in
connection with such Permitted Executive Termination (it being agreed that the
Executive shall have the right to terminate Executive’s obligations under
subsections (i), (ii), (iii) and (v) of this Section 12 by waiving in writing
(at the time of such Permitted Executive Termination) the right to receive any
and allpayments or benefits under Sections 6(a)(i)(B), 6(a)(ii), 6(a)(iii) and
6(a)(iv) of this Agreement).

13.           Miscellaneous.

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

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

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

 12
 

If to the Executive:

5732 White Cloud Circle

Westlake Village, California 91362

If to the Company:

1000 Abernathy Road

Suite 1200

Atlanta, Georgia 30328

Attention: Company
Secretary

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

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

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

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

(g)           Except as may otherwise
be provided under any other written agreement between the Executive and the
Company, the Executive and the Company acknowledge that the employment of the
Executive by the Company is “at will” and, subject to Section 1 hereof, prior
to the Effective Date, the Executive’s employment and/or this Agreement may be
terminated by either the Executive or the Company at any time prior to the
Effective Date, in which case the Executive shall have no further rights under
this Agreement. From and after the Effective Date, this Agreement shall
supersede any other agreement between the parties with respect to the subject
matter hereof and, upon the Effective Date, any such other agreement shall be
null, void and of no further force or effect.

14.           Special Provisions Re Section 409A of the Internal
Revenue Code.  It is
intended that this Agreement will comply with Section 409A of the Code (and any
regulations and any  guidelines issued
thereunder) to the extent the Agreement is subject thereto, and the Agreement
shall be interpreted on a basis consistent with such intent.  If it is determined that an amendment of this
Agreement is necessary in order for it to comply with Section 409A, the parties
agree to negotiate in good faith to amend this Agreement in a manner that
preserves the original intent of the parties to the extent reasonably
possible.  Notwithstanding any provision
to the contrary in this Agreement, in the event that any payments or benefits
required to be provide by the Company hereunder are deemed to constitute
payments of “nonqualified deferred compensation” that is subject to the
requirements of Section 409A and if the Executive is deemed on the Date of
Termination to be a “specified employee” within the meaning of that term under
Section 409A(a)(2)(B) of the Code, then with regard to any payment or the
provisions of any benefit that is required to be delayed pursuant to Section
409A(a)(2)(B) of the Code, such payment or benefit shall not be made or
provided prior to the earlier of (i) the expiration of the six (6)-month period
measured from the date of his “separation from service” (as such term is
defined in Treasury Regulations issued under Section 409A), or (ii) the date of
his death (the “Delay Period”). 
Upon the expiration of the Delay Period, all payments and benefits
delayed pursuant to this Section 14 (whether they would have otherwise been
payable in a single sum or in installments in the absence of such delay) shall
be paid or reimbursed to the Executive in a lump sum, and any remaining
payments and benefits due under this Agreement shall be paid or provided in
accordance with the normal payment dates specified for them herein.  Notwithstanding the foregoing, to the extent
that the foregoing applies to the provision of any 

 13
 

ongoing welfare benefits
to the Executive that would not be required to be delayed if the premiums
therefor were paid by the Executive, the Executive shall pay the full costs of
premiums for such welfare benefits during the Delay Period and the Company
shall pay the Executive an amount equal to the amount of such premiums paid by
the Executive during the Delay Period promptly after its conclusion.

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

	
  

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  ALLAN MERRILL

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  BEAZER HOMES USA, INC.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  Ian J. McCarthy

  
	
   

  	
   

  	
   

  	
  President and Chief Executive Officer

  
					

 

 14

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