THIS
CONSENT AND WAIVER (“Consent”), dated as of the
4 day of December, 2006, by and among AVATAR PROPERTIES INC.,
a Florida corporation (“Borrower”), joined by AVATAR
HOLDINGS INC., a Delaware corporation (“Guarantor”) and
WACHOVIA BANK, NATIONAL ASSOCIATION, in its capacity as Lender and
in its capacity as administrative agent (“Agent”),
GUARANTY BANK, in its capacity as Lender and FRANKLIN BANK, SSB, a
Texas Savings Bank, in its capacity as Lender (each a
“Lender” and collectively, the “Lenders”).
This Consent shall become effective as of the date
hereof.
WHEREAS,
on September 20, 2005, Borrower and Guarantor entered into a
Credit Agreement with the Lenders, the Arranger and the other
lenders from time to time party thereto, evidencing a senior
unsecured revolving credit facility which, as of the date of
execution thereof, had a maximum outstanding principal balance of
$100,000,000 (as amended by the First Amendment to Credit Agreement
dated as of May 25, 2006, and as further amended by the Second
Amendment to Credit Agreement dated as of September 1, 2006,
the “Credit Agreement”), and which was increased to a
maximum outstanding principal balance of $125,000,000 pursuant to
that certain Commitment and Acceptance dated as of October 21,
2005; and
WHEREAS,
in accordance with Section 10.02(b)(ii) of the Credit
Agreement, Borrower has requested a written consent from the
Requisite Lenders approving a temporary waiver of the housing
inventory covenant set forth in Section 6.08 of the Credit
Agreement;
WHEREAS,
Borrower, Guarantor and Lenders intend to enter into this Consent
in order to temporarily waive the housing inventory covenant set
forth in Section 6.08 of the Credit Agreement;
NOW THEREFORE , in consideration of the sum of TEN DOLLARS
($10.00) and other good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, as well as the mutual
covenants herein contained, the parties hereto agree as
follows:
1.
RECITALS . The above recitals are true and correct
and are incorporated herein by this reference.
2.
CAPITALIZED TERMS . Capitalized terms not defined
herein shall have the meaning ascribed to them in the Credit
Agreement.
3.
REPRESENTATIONS; REAFFIRMATION . Borrower and
Guarantor each represent and warrant that, as of the date hereof
and after giving effect to this Consent: (a) no event or
condition shall have occurred and then be continuing w
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