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Employment Agreement - BLUEGREEN CORP - 11-17-1999

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Employment Agreement - BLUEGREEN CORP - 11-17-1999 Powered By Docstoc
					EXHIBIT 10.129 EMPLOYMENT AGREEMENT AGREEMENT made as of this 30th day of August, 1999, between BLUEGREEN CORPORATION, a Massachusetts corporation (hereafter "Bluegreen"), having a usual place of business in Boca Raton, Florida, and David D. Philp (hereafter "Employee"), an individual and resident of Florida. 1. GENERAL. The parties desire to enter into this Agreement to ensure the continued service of Employee to Bluegreen and to ensure Employee of his long-term employment as the Chief Investment Officer of Bluegreen and Senior Vice President of Bluegreen. The Employee represents that he has, and will continue to have, knowledge of the timeshare development business. The Employee acknowledges that by virtue of his position as Chief Investment Officer and Senior Vice President he will acquire information relating to the affairs of Bluegreen, and, by reason of his position, that this knowledge does and will include proprietary knowledge, trade secrets and all manner of confidential, proprietary and sensitive information. NOW, THEREFORE, the parties agree further as follows: 2. TERM. The term of this Agreement shall be for three (3) years from date hereof, provided further that this Agreement shall automatically renew itself at the end of the third year and each year extension for a one year period, unless terminated as provided in paragraph 10 herein. 3. POSITION. Employee shall be employed as Chief Investment Officer of Bluegreen and Employee shall be elected to the position of Senior Vice President of Bluegreen and serve in that position at the discretion of the board of Directors. Employee shall also serve as a member of Bluegreen's Investment Committee during the term herein. The Investment Committee is responsible for the review and approval of Bluegreen's major investments and acquisitions. As of the date of this Agreement, the members of the Investment Committee include George F. Donovan, President and Chief Executive Officer, John F. Chiste, Senior Vice President, Treasurer and Chief Financial Officer, L. Nicholas Gray, Senior Vice President, Resorts Division, Daniel C. Koscher, Senior Vice President, Land Division and Patrick E. Rondeau, Senior Vice President, Director of Corporate Legal Affairs and Clerk.

4. DUTIES. Employee shall have and perform the duties customarily assumed by the Chief Investment Officer of a corporation, which shall include duties over the affairs of Bluegreen as a Senior Vice President and such other duties as shall be assigned to him by the Chief Executive Officer. Additionally, Employee shall have duties, authority and responsibility commensurate with his position and those of executives of similarly sized companies in the industry of which Bluegreen is a part. Employee shall devote all of his business time to the business and affairs of Bluegreen. Employee shall devote his business time exclusively to the performance of his duties hereunder and shall carry out his duties in a good and professional manner. We recognize that Employee has minor outside duties associated with being a restaurant owner/board member. Employee shall be subject, and shall report, to the Chief Executive Officer of Bluegreen.

4. DUTIES. Employee shall have and perform the duties customarily assumed by the Chief Investment Officer of a corporation, which shall include duties over the affairs of Bluegreen as a Senior Vice President and such other duties as shall be assigned to him by the Chief Executive Officer. Additionally, Employee shall have duties, authority and responsibility commensurate with his position and those of executives of similarly sized companies in the industry of which Bluegreen is a part. Employee shall devote all of his business time to the business and affairs of Bluegreen. Employee shall devote his business time exclusively to the performance of his duties hereunder and shall carry out his duties in a good and professional manner. We recognize that Employee has minor outside duties associated with being a restaurant owner/board member. Employee shall be subject, and shall report, to the Chief Executive Officer of Bluegreen. 5. ANNUAL BASE SALARY. Beginning on the date of the commencement of his employment in the Corporate office no later than September 30, 1999, Employee's base salary through April 1, 2000, shall be at the rate of $175,000 annually, payable biweekly. Thereafter, Employee's base salary amount will be reviewed annually at the commencement of each fiscal year. This base salary shall not be reduced below $175,000 annually during the term of this Agreement, including renewals herein. 6. ANNUAL BONUS. Employee shall be eligible to receive cash bonuses payable annually (or at such lesser intervals as may be approved by the Board of Directors), pursuant to the incentive bonus plan of Bluegreen as approved by the Board of Directors from time to time. Bluegreen agrees that the Employee shall receive as a bonus in April 2000 the amount of $125,000. Commencing with Fiscal Year 2001 (April 3, 2000 through April 1, 2001), and for each fiscal year thereafter the annual bonus amount is subject to periodic review and modification. For Fiscal Year 2001, Bluegreen agrees to include in the bonus pool for senior management the sum $225,000 for the Employee which he may earn based on the contribution made by the Employee and the success of Bluegreen in meeting its strategic objectives, subject to Board of Director approval, notwithstanding anything to the contrary. Bluegreen agrees that the Employee's annual cash compensation (base salary plus annual bonus) during the term of the agreement shall not go below $300,000 per year. 2

7. INITIAL STOCK OPTIONS. The Employee shall receive as of the day this agreement is executed a Stock Option Agreement for the 100,000 shares of Bluegreen stock with vesting of option shares commencing and at a price set as of the close of the stock market for that day. The stock options shall be granted pursuant to the existing Employee Incentive Stock Option Plan. 8. OPTION REIMBURSEMENT. The Employee represents to Bluegreen that he presently holds non-vested options for stock of his present employer, which currently have a potential value to the Employee. Bluegreen agrees, as an incentive to the Employee, to compensate the Employee for the lost opportunity on the non-vested stock options the sum of $150,000 subject to the approval of the Board of Directors, which will be paid in the following manner. On the first pay period following the day the Employee commences work for Bluegreen the Employee shall receive a check for 60% of the amount set forth above. On the first pay period following the anniversary of his commencement of work for the next two years the remaining 40% shall be paid in equal installments. 9. BENEFITS.

7. INITIAL STOCK OPTIONS. The Employee shall receive as of the day this agreement is executed a Stock Option Agreement for the 100,000 shares of Bluegreen stock with vesting of option shares commencing and at a price set as of the close of the stock market for that day. The stock options shall be granted pursuant to the existing Employee Incentive Stock Option Plan. 8. OPTION REIMBURSEMENT. The Employee represents to Bluegreen that he presently holds non-vested options for stock of his present employer, which currently have a potential value to the Employee. Bluegreen agrees, as an incentive to the Employee, to compensate the Employee for the lost opportunity on the non-vested stock options the sum of $150,000 subject to the approval of the Board of Directors, which will be paid in the following manner. On the first pay period following the day the Employee commences work for Bluegreen the Employee shall receive a check for 60% of the amount set forth above. On the first pay period following the anniversary of his commencement of work for the next two years the remaining 40% shall be paid in equal installments. 9. BENEFITS. (a) Employee shall be entitled, in accordance with Bluegreen's policies and procedures for senior executive personnel (including members of Investment Committee) and Plan Documents, to participation in any pension, savings, 401(k), stock option, employee stock ownership and profit-sharing plans, health insurance, leave, vacation and other employment benefits as are made available from time to time by the Board to or for the benefit of Company management. (b) During his term of employment, Employee shall be entitled to prompt reimbursement of all reasonable expenses incurred in the course of and pursuant to the performance of his duties hereunder and in connection with promoting and carrying out the business of Bluegreen in accordance with Company policy and procedures. Employee agrees to maintain adequate documentary proof and written records, in such detail as the Company may reasonably request, of all fees, costs and expenses to be reimbursed by the Company hereunder. (c) Employee shall be eligible beginning in April 2000 to receive additional stock options as may be approved by the Board of Directors from time to time. (d) Employee shall also receive reimbursement for reasonable relocation expenditures including, but not limited to: (1) transportation of Employee's household goods from California to the Boca Raton, Florida area; 3

(2) temporary housing in the Boca Raton, Florida area for a period of up to ninety days; and (3) reimbursement for travel related expenditures incurred for three (3) househunting trips. Employee agrees to coordinate all relocation activities through Bluegreen's Human Resources department. Reimbursed relocation expenditures will be treated as taxable compensation to Employee as required by IRS regulations. 9. AUTOMATIC RENEWAL; NOTICE OF NON-RENEWAL. (a) This Agreement shall automatically renew itself at the end of the third year and each year thereafter, unless either party shall give notice to the other of their intention not to renew the Agreement. Any notice of intention not to renew shall be given at least sixty (60) days prior to the expiration of the applicable term. (b) A notice of non-renewal by Bluegreen shall be deemed a termination without cause as of the end of the then term, except that if the determination by Bluegreen not to renew is based upon an event or action which would permit a for cause termination as defined herein, it shall be deemed a "for cause" termination. A notice of non-renewal by Employee shall be deemed a termination without cause. (c) Bluegreen may, by written notice to Employee, terminate this Agreement with or without cause at any time,

(2) temporary housing in the Boca Raton, Florida area for a period of up to ninety days; and (3) reimbursement for travel related expenditures incurred for three (3) househunting trips. Employee agrees to coordinate all relocation activities through Bluegreen's Human Resources department. Reimbursed relocation expenditures will be treated as taxable compensation to Employee as required by IRS regulations. 9. AUTOMATIC RENEWAL; NOTICE OF NON-RENEWAL. (a) This Agreement shall automatically renew itself at the end of the third year and each year thereafter, unless either party shall give notice to the other of their intention not to renew the Agreement. Any notice of intention not to renew shall be given at least sixty (60) days prior to the expiration of the applicable term. (b) A notice of non-renewal by Bluegreen shall be deemed a termination without cause as of the end of the then term, except that if the determination by Bluegreen not to renew is based upon an event or action which would permit a for cause termination as defined herein, it shall be deemed a "for cause" termination. A notice of non-renewal by Employee shall be deemed a termination without cause. (c) Bluegreen may, by written notice to Employee, terminate this Agreement with or without cause at any time, subject to provisions as set forth in paragraphs 11 & 15. 9. TERMINATION WITHOUT CAUSE BY BLUEGREEN. (a) Bluegreen may, by written notice to Employee, terminate Employee's employment hereunder at any time without cause, or elect not to renew this Agreement without cause, provided that it delivers to Employee a sixty (60) day written notice of such termination or election and provides to Employee the payments required in this paragraph. Upon termination of Employee's employment pursuant to this paragraph, Employee shall be paid the base salary and a minimum bonus amount of $125,000 to which Employee is entitled under paragraph 5 and 6 herein, at Bluegreen's regular and customary intervals for such payment, subject to the appropriate deductions in accordance with federal and state law and such deductions for continuing benefits, if any. 4

Upon the termination of employment, Bluegreen shall further promptly pay to Employee all other amounts to which Employee is entitled in accordance with this Agreement and Bluegreen policies and procedures (e.g. expense accounts, vacation pay, etc.). (a) Upon termination without cause by Bluegreen, Employee shall, in addition to the payment of the base salary and minimum bonus above provided for, and to all other amounts due him from Bluegreen, receive at the same time as bonus payments are made to other executive Employees, a pro rata share of any bonus payable for the fiscal year during which the termination occurred, determined upon the same basis that his bonus would have been determined had he continued in employment for the entire fiscal year of termination, provided that at the time of payment he is not in breach of any of the continuing obligations imposed upon him in paragraph 17 herein. The Employee shall be entitled to receive a pro rata share of the bonus amount only if that amount would exceed the minimum bonus guaranteed by this agreement. (b) Upon Employee's termination by Bluegreen without cause, all options theretofore granted to Employee that are not vested shall immediately vest including any balance due, in whole or in part, on amounts owed pursuant to paragraph 8 herein will be immediately paid. 12. TERMINATION BY EMPLOYEE WITHOUT CAUSE. If Employee terminates this Agreement upon sixty (60) days notice to Bluegreen without reason or cause as defined in paragraph 16, or gives notice of his intention not to renew, Employee shall be entitled to receive only those amounts owing to him as defined in Paragraph 5 herein, as of the time of the termination of his employment, which amounts shall be paid to him promptly on the termination of employment in accordance with Bluegreen policies and procedures.

Upon the termination of employment, Bluegreen shall further promptly pay to Employee all other amounts to which Employee is entitled in accordance with this Agreement and Bluegreen policies and procedures (e.g. expense accounts, vacation pay, etc.). (a) Upon termination without cause by Bluegreen, Employee shall, in addition to the payment of the base salary and minimum bonus above provided for, and to all other amounts due him from Bluegreen, receive at the same time as bonus payments are made to other executive Employees, a pro rata share of any bonus payable for the fiscal year during which the termination occurred, determined upon the same basis that his bonus would have been determined had he continued in employment for the entire fiscal year of termination, provided that at the time of payment he is not in breach of any of the continuing obligations imposed upon him in paragraph 17 herein. The Employee shall be entitled to receive a pro rata share of the bonus amount only if that amount would exceed the minimum bonus guaranteed by this agreement. (b) Upon Employee's termination by Bluegreen without cause, all options theretofore granted to Employee that are not vested shall immediately vest including any balance due, in whole or in part, on amounts owed pursuant to paragraph 8 herein will be immediately paid. 12. TERMINATION BY EMPLOYEE WITHOUT CAUSE. If Employee terminates this Agreement upon sixty (60) days notice to Bluegreen without reason or cause as defined in paragraph 16, or gives notice of his intention not to renew, Employee shall be entitled to receive only those amounts owing to him as defined in Paragraph 5 herein, as of the time of the termination of his employment, which amounts shall be paid to him promptly on the termination of employment in accordance with Bluegreen policies and procedures. 13. DISABILITY. In the event that Employee shall be incapacitated by reason of mental or physical disability during the term of his employment hereunder so that he is substantially prevented from performing his duties and services hereunder for a period of ninety (90) consecutive days, or for shorter periods aggregating 120 days during any 12-month period, Bluegreen thereafter shall have the right to terminate Employee's employment under this Agreement by sending written notice of such termination to Employee or his legal representative and thereupon Employee's employment hereunder shall immediately terminate. Upon such termination, Employee shall be entitled to receive and shall be paid by Bluegreen, all amounts for business related expenses incurred by Employee on behalf of Bluegreen, and on a bi-weekly basis, his base salary as in effect on the date of termination for twelve (12) months. At such time, all options theretofore granted to 5

Employee that are not vested shall immediately vest, and any balance due, in whole or in part, on amounts owed pursuant to paragraph 8 herein will be immediately paid. Employee shall accept such payments in full discharge and release of Bluegreen of and from any further obligations under this Agreement. Such discharge and release shall not affect any rights or remedies which may be available to Employee otherwise than under this Agreement. 14. DEATH. In the event of Employee's death during the term of his employment hereunder, Employee's designated beneficiary or, if no such beneficiary shall have been designated by Employee, the estate of Employee, shall be entitled to receive and shall be paid by Bluegreen any and all of Employee's unpaid salary compensation due as of the date of his death, and any other amounts due to Employee, in each case through the date of death. In addition, as of date of death, all options theretofore granted to Employee that are not vested shall immediately vest, and any balance due, in whole or in part, on amounts owed pursuant to paragraph 8 herein will be immediately paid. Except as otherwise noted herein, Employee shall be entitled to no payments or benefits following the date of death. Such payments shall be in full discharge and release of Bluegreen of and from any further obligations under this Agreement. Such discharge and release shall not affect any rights or remedies which may be available to Employee (or Employee's estate) otherwise than under this Agreement.

Employee that are not vested shall immediately vest, and any balance due, in whole or in part, on amounts owed pursuant to paragraph 8 herein will be immediately paid. Employee shall accept such payments in full discharge and release of Bluegreen of and from any further obligations under this Agreement. Such discharge and release shall not affect any rights or remedies which may be available to Employee otherwise than under this Agreement. 14. DEATH. In the event of Employee's death during the term of his employment hereunder, Employee's designated beneficiary or, if no such beneficiary shall have been designated by Employee, the estate of Employee, shall be entitled to receive and shall be paid by Bluegreen any and all of Employee's unpaid salary compensation due as of the date of his death, and any other amounts due to Employee, in each case through the date of death. In addition, as of date of death, all options theretofore granted to Employee that are not vested shall immediately vest, and any balance due, in whole or in part, on amounts owed pursuant to paragraph 8 herein will be immediately paid. Except as otherwise noted herein, Employee shall be entitled to no payments or benefits following the date of death. Such payments shall be in full discharge and release of Bluegreen of and from any further obligations under this Agreement. Such discharge and release shall not affect any rights or remedies which may be available to Employee (or Employee's estate) otherwise than under this Agreement. 15. TERMINATION FOR CAUSE BY BLUEGEEN. (a) Bluegreen shall have the right to terminate the employment of Employee subject to a thirty (30) day notification period or elect not to renew this Agreement, for cause, at any time if: (i) Employee shall be convicted by a court of competent and final jurisdiction of any crime (whether or not involving Bluegreen) which constitutes a felony in the jurisdiction involved or shall be habitually drunk or intoxicated in public or otherwise commit acts of moral turpitude in such a manner as to materially and adversely reflect upon the reputation of Bluegreen or its senior management; or (ii) Employee shall commit any act of embezzlement, fraud or similar dishonest and injurious conduct against or with respect to Bluegreen; or (iii) Employee shall demonstrate injurious misconduct in connection with the performance of his duties and responsibilities under this Agreement (and/or as assigned to him from time to time by the Chief Executive Officer in accordance with the provisions herein); or 6

(iv) Employee shall demonstrate negligent, reckless or grossly negligent and injurious conduct in connection with the performance of, or a gross disregard for, his duties and responsibilities under this Agreement and as assigned to him from time to time by the Chief Executive Officer in accordance with the provisions herein. (a) Any determination to terminate Employee for cause pursuant to paragraph 15 (a) herein shall be made in the good faith judgment of the Chief Executive Officer following a bona fide investigation conducted by Bluegreen and/or its designee. (b) In the event that the employment of Employee shall be terminated by Bluegreen for cause pursuant to this paragraph, Employee shall be entitled to receive his salary, and any other amounts properly due from Bluegreen to Employee, through the date of such termination. 16. TERMINATION BY EMPLOYEE WITH CAUSE. Employee may, by written notice to Bluegreen, terminate Employee's employment hereunder, provided that he delivers to Bluegreen not less than sixty (60) days advance written notice of such termination (the sixty (60) day period between such notice and termination being referred to herein as the "Termination Period"). During the Termination Period, so long as Employee performs his duties and responsibilities as required in accordance with this Agreement (and so long as Bluegreen is not entitled to terminate Employee for cause pursuant to paragraph 15 herein, in which case the provisions of paragraph 15, and not this paragraph 16, shall apply), Employee shall

(iv) Employee shall demonstrate negligent, reckless or grossly negligent and injurious conduct in connection with the performance of, or a gross disregard for, his duties and responsibilities under this Agreement and as assigned to him from time to time by the Chief Executive Officer in accordance with the provisions herein. (a) Any determination to terminate Employee for cause pursuant to paragraph 15 (a) herein shall be made in the good faith judgment of the Chief Executive Officer following a bona fide investigation conducted by Bluegreen and/or its designee. (b) In the event that the employment of Employee shall be terminated by Bluegreen for cause pursuant to this paragraph, Employee shall be entitled to receive his salary, and any other amounts properly due from Bluegreen to Employee, through the date of such termination. 16. TERMINATION BY EMPLOYEE WITH CAUSE. Employee may, by written notice to Bluegreen, terminate Employee's employment hereunder, provided that he delivers to Bluegreen not less than sixty (60) days advance written notice of such termination (the sixty (60) day period between such notice and termination being referred to herein as the "Termination Period"). During the Termination Period, so long as Employee performs his duties and responsibilities as required in accordance with this Agreement (and so long as Bluegreen is not entitled to terminate Employee for cause pursuant to paragraph 15 herein, in which case the provisions of paragraph 15, and not this paragraph 16, shall apply), Employee shall be entitled to the salary, bonus and benefits (to the extent earned and accrued) described in this Agreement in Paragraph 11, in each case, payable at Bluegreen's regular and customary intervals for such payment or benefit. The following events shall, ipso facto, constitute a termination with cause: (i) Employee is assigned to any position, duties or responsibilities that are significantly diminished when compared with the position, duties or responsibilities of the Employee on the date of this Agreement, except when such action is taken because of Employee's inability to perform his duties; (ii) the Employee is requested to engage in conduct that is reasonably likely to result in a violation of law; (iii) the failure by Bluegreen to obtain the assumption of, and agreement to perform, this Agreement by any successor to its business; 7

(iv) repudiation by Bluegreen of any material obligation of Bluegreen under this Agreement; (v) the sale of all or substantially all of the business and/or assets of Bluegreen or the liquidation of Bluegreen; (vi) a change in the Employee's direct reporting relationship. 17. RESTRICTION ON EMPLOYEE'S ACTIVITIES FOLLOWING TERMINATION. Employee agrees that following termination by Bluegeen of his employment for cause or termination by Employee of his employment without cause as defined herein, and for a period of six (6) months thereafter: (a) NON-COMPETITION. Employee shall not, directly or indirectly, for himself or any other person or entity, engage in or have any interest in any sole proprietorship, partnership, corporation, association or business or any other person or entity (whether as an employee, officer, director, partner, agent, security holder, creditor, consultant or otherwise) that, directly or indirectly, engages in competition (as defined herein) with Bluegreen and/or any subsidiary Employee is involved with, provided, however, that Employee may acquire, solely as an investment, shares of capital stock or other equity securities of any company which are traded on any national securities exchange or are regularly quoted in the over-the-counter market, so long as the Employee does not control, acquire a controlling interest in or become a member of a group which exercises direct or indirect control of, more than five percent (5%) of any class of capital stock of such corporation. The Employee acknowledges that Bluegreen would be severely and adversely affected if the Employee engages in competition with Bluegreen.

(iv) repudiation by Bluegreen of any material obligation of Bluegreen under this Agreement; (v) the sale of all or substantially all of the business and/or assets of Bluegreen or the liquidation of Bluegreen; (vi) a change in the Employee's direct reporting relationship. 17. RESTRICTION ON EMPLOYEE'S ACTIVITIES FOLLOWING TERMINATION. Employee agrees that following termination by Bluegeen of his employment for cause or termination by Employee of his employment without cause as defined herein, and for a period of six (6) months thereafter: (a) NON-COMPETITION. Employee shall not, directly or indirectly, for himself or any other person or entity, engage in or have any interest in any sole proprietorship, partnership, corporation, association or business or any other person or entity (whether as an employee, officer, director, partner, agent, security holder, creditor, consultant or otherwise) that, directly or indirectly, engages in competition (as defined herein) with Bluegreen and/or any subsidiary Employee is involved with, provided, however, that Employee may acquire, solely as an investment, shares of capital stock or other equity securities of any company which are traded on any national securities exchange or are regularly quoted in the over-the-counter market, so long as the Employee does not control, acquire a controlling interest in or become a member of a group which exercises direct or indirect control of, more than five percent (5%) of any class of capital stock of such corporation. The Employee acknowledges that Bluegreen would be severely and adversely affected if the Employee engages in competition with Bluegreen. (b) NONDISCLOSURE. Employee will not divulge, communicate, utilize or exploit in any way other than in performing his duties hereunder, any material confidential information (as hereinafter defined) pertaining to the business of Bluegreen. Any material confidential information or data now or hereafter acquired by the Employee with respect to the business of Bluegreen (which shall include material information concerning Bluegreen's sourcing information and marketing and promotion of Bluegreen's products and services) shall be deemed a valuable, special and unique asset of Bluegreen that is received by the Employee in confidence and as a fiduciary, and Employee shall remain a fiduciary to Bluegreen with respect to all of such information during the Employee's employment hereunder and for a period of six (6) months thereafter. In addition, with respect to specific contractual relationships of Bluegreen, Employee shall not divulge, communicate or utilize or exploit in any way other than in performing his duties hereunder and 8

shall remain a fiduciary with respect to confidential information relating to such contractual relationships of Bluegreen for the longer of (a) the term of such contract, or (b) six (6) months after the end of the Employee's employment hereunder. For purposes of this Agreement "confidential information" means information disclosed to the Employee or known by the Employee as a consequence of or through his employment by Bluegreen (including information conceived, originated, discovered or developed by the Employee) prior to or after the date hereof, and not generally known, about Bluegreen's products and services. Notwithstanding the above, any information generally available to the public or information that has been previously disclosed by another Bluegreen employee to the public is excluded. (c) NON-SOLICITATION OF EMPLOYEES. Employee will not, directly or indirectly, for himself or for any other person, firm, corporation partnership, association or other entity attempt to recruit, either directly or indirectly, any present employee of Bluegreen, unless such employee has not been employed by Bluegreen for a period in excess of six (6) months. (d) BOOKS AND RECORDS. All books, records, accounts and similar tangible repositories of confidential information of Bluegreen, whether prepared by Employee or otherwise coming into Employee's possession, shall be the exclusive property of Bluegreen and shall be returned immediately to Bluegreen on termination of this Agreement, or at the request of the Chief Executive Officer at any time. (e) COMPETITION. Competition, as used herein, shall mean any organization or persons who are in the business of land development or time sharing within any state or jurisdiction in which Bluegreen is, at the time of termination of employment, itself engaged in land development or time sharing.

shall remain a fiduciary with respect to confidential information relating to such contractual relationships of Bluegreen for the longer of (a) the term of such contract, or (b) six (6) months after the end of the Employee's employment hereunder. For purposes of this Agreement "confidential information" means information disclosed to the Employee or known by the Employee as a consequence of or through his employment by Bluegreen (including information conceived, originated, discovered or developed by the Employee) prior to or after the date hereof, and not generally known, about Bluegreen's products and services. Notwithstanding the above, any information generally available to the public or information that has been previously disclosed by another Bluegreen employee to the public is excluded. (c) NON-SOLICITATION OF EMPLOYEES. Employee will not, directly or indirectly, for himself or for any other person, firm, corporation partnership, association or other entity attempt to recruit, either directly or indirectly, any present employee of Bluegreen, unless such employee has not been employed by Bluegreen for a period in excess of six (6) months. (d) BOOKS AND RECORDS. All books, records, accounts and similar tangible repositories of confidential information of Bluegreen, whether prepared by Employee or otherwise coming into Employee's possession, shall be the exclusive property of Bluegreen and shall be returned immediately to Bluegreen on termination of this Agreement, or at the request of the Chief Executive Officer at any time. (e) COMPETITION. Competition, as used herein, shall mean any organization or persons who are in the business of land development or time sharing within any state or jurisdiction in which Bluegreen is, at the time of termination of employment, itself engaged in land development or time sharing. 18. INJUNCTION. Employee acknowledges that the services to be rendered by him are of a special, unique and extraordinary character, that, in connection with such services, he will have access to confidential, proprietary and/or sensitive competitive information vital to Bluegreen's business operations and prospects and that therefore the restrictive covenants set forth in paragraph 17 are fair and reasonable, are material to this Agreement and have materially induced Bluegreen to enter into this Agreement and provide the benefits to Employee provided hereunder. Accordingly, Employee consents and agrees that if he violates or breaches any of the provisions of paragraph 17, Bluegreen would sustain irreparable harm and, therefore, in addition to any other remedies which may be available to it, Bluegreen shall be entitled to apply to any court of competent jurisdiction, for an injunction restraining Employee from committing or continuing any such violation of this Agreement, or for such other equitable or special relief that Bluegreen shall deem 9

appropriate in view of such violation. Nothing in this Agreement shall be construed as prohibiting Bluegreen from pursuing any other remedy or remedies including, without limitation, recovery of damages, permitted at law or in equity. 19. MODIFICATION OF RESTRICTIONS. In the event that any of the provisions continued in this agreement shall be held to be in any way an unreasonable restriction on Employee or otherwise void or unenforceable, then the court so holding may reduce the territory and/or period of time in which such restriction operates, or modify or eliminate any such restriction, to the extent necessary to render such paragraph enforceable to the maximum extent permitted by law. 20. ARBITRATION. Save for the provisions of paragraph 18 with respect to injunctive relief, all disputes arising under this Agreement shall be subject to arbitration, and neither party shall bring any action in any court with reference thereto except to obtain enforcement of any arbitration award. Arbitration shall be in accordance with and under the rules of the American Arbitration Association as in effect at the time of the dispute unless the parties shall agree to some different alternative dispute resolution method. All costs, expenses and awards under the arbitration or alternative dispute resolution method shall be divided between the parties as the arbitrator may determine.

appropriate in view of such violation. Nothing in this Agreement shall be construed as prohibiting Bluegreen from pursuing any other remedy or remedies including, without limitation, recovery of damages, permitted at law or in equity. 19. MODIFICATION OF RESTRICTIONS. In the event that any of the provisions continued in this agreement shall be held to be in any way an unreasonable restriction on Employee or otherwise void or unenforceable, then the court so holding may reduce the territory and/or period of time in which such restriction operates, or modify or eliminate any such restriction, to the extent necessary to render such paragraph enforceable to the maximum extent permitted by law. 20. ARBITRATION. Save for the provisions of paragraph 18 with respect to injunctive relief, all disputes arising under this Agreement shall be subject to arbitration, and neither party shall bring any action in any court with reference thereto except to obtain enforcement of any arbitration award. Arbitration shall be in accordance with and under the rules of the American Arbitration Association as in effect at the time of the dispute unless the parties shall agree to some different alternative dispute resolution method. All costs, expenses and awards under the arbitration or alternative dispute resolution method shall be divided between the parties as the arbitrator may determine. The arbitrator's decision shall be final. 21. GOVERNING LAW. This Agreement shall be governed by and construed in accordance with the laws of the State of Florida. 22. NOTICES. Any notice required or permitted to be given under this Agreement shall be in writing and shall be deemed to have been given when delivered by hand or when deposited in the United States mail, by registered or certified mail, return receipt requested, postage prepaid, addressed as follows: If to Bluegreen: Patrick E. Rondeau, Esq. Bluegreen Corporation 4960 Blue Lake Drive Boca Raton, FL 33431 10

If to Employee: David D. Philp Bluegreen Corporation 4960 Blue Lake Drive Boca Raton, FL 33431 Or to such other addresses as either party hereto may from time to time give notice of to the other in the aforesaid manner. 23. SEVERABILITY. The invalidity of any one or more of the words, phrases, sentences, clauses or sections contained in this Agreement shall not affect the enforceability of the remaining portions of this Agreement of any part there of all of which are inserted conditioned on their being valid in law, and, in the event that any one or more of the words, phrases, sentences, clauses or sections contained in this Agreement shall be declared invalid, this Agreement shall

If to Employee: David D. Philp Bluegreen Corporation 4960 Blue Lake Drive Boca Raton, FL 33431 Or to such other addresses as either party hereto may from time to time give notice of to the other in the aforesaid manner. 23. SEVERABILITY. The invalidity of any one or more of the words, phrases, sentences, clauses or sections contained in this Agreement shall not affect the enforceability of the remaining portions of this Agreement of any part there of all of which are inserted conditioned on their being valid in law, and, in the event that any one or more of the words, phrases, sentences, clauses or sections contained in this Agreement shall be declared invalid, this Agreement shall be construed as if such invalid word or words, phrase or phrases, sentence or sentences, clause or clauses or section or sections had not been inserted. If such invalidity is caused by length of time or size of area, or both the otherwise invalid provisions will be considered to be reduced to a period or area, which would cure such invalidity. 24. WAIVERS. The waiver by either party hereto of a breach or violation of any term or provision of this Agreement shall not operate as nor be construed as a waiver of any subsequent breach or violation. 25. DAMAGES. Subject to the provisions of paragraph 20, nothing contained herein shall be construed to prevent Bluegreen or the Employee from seeking and recovering from the other damages sustained by either or both of them as a result of its or his breach of any term or provision of this Agreement. 26. NO THIRD-PARTY BENEFICIARY. Nothing expressed or implied in this Agreement is intended, or shall be construed, to confer upon or give any person (other than the parties hereto and, in the case of the Employee, his heirs, personal representative(s) and /or legal representative) any rights or remedies under or by reason of this Agreement. 11

27. SUCCESSORS. This Agreement shall inure to the benefit of and be enforceable by the Employee's personal or legal representatives, executors, administrators, successors, heirs, distributees, devisees and legatees. 28. ENTIRE AGREEMENT. This Agreement constitutes the entire agreement between Bluegreen and the Employee with respect to its subject matter and supersedes all prior negotiations, agreements, understandings and arrangements, both oral and written, between Bluegreen and the Employee with respect to his employment. 29. COUNSEL. Bluegreen and the Employee represent and agree that each of them have thoroughly discussed all aspects of this Agreement with their respective attorneys, and that they have carefully read and fully understand all of the provisions of this Agreement and have voluntarily entered into it.

27. SUCCESSORS. This Agreement shall inure to the benefit of and be enforceable by the Employee's personal or legal representatives, executors, administrators, successors, heirs, distributees, devisees and legatees. 28. ENTIRE AGREEMENT. This Agreement constitutes the entire agreement between Bluegreen and the Employee with respect to its subject matter and supersedes all prior negotiations, agreements, understandings and arrangements, both oral and written, between Bluegreen and the Employee with respect to his employment. 29. COUNSEL. Bluegreen and the Employee represent and agree that each of them have thoroughly discussed all aspects of this Agreement with their respective attorneys, and that they have carefully read and fully understand all of the provisions of this Agreement and have voluntarily entered into it. 30. MISCELLANEOUS. The captions and headings herein are for convenience of reference only and shall not be deemed to be a part of the substance of this Agreement. IN WITNESS WHEREOF, the parties have executed this Agreement the day and year first above written. BLUEGREEN CORPORATION
/s/ GEORGE F. DONOVAN ---------------------------George F. Donovan Chief Executive Officer Bluegreen Corporation /s/ DAVID D. PHILP -----------------------------David D. Philp Employee

12

EXHIBIT 10.130 SECOND AMENDED AND RESTATED CREDIT FACILITY AGREEMENT THIS SECOND AMENDED AND RESTATED CREDIT FACILITY AGREEMENT ("Agreement") entered into as of September 14, 1999, by FINOVA CAPITAL CORPORATION, a Delaware corporation, and BLUEGREEN CORPORATION, a Massachusetts corporation. RECITALS A. Lender and Borrower are parties to an Amended and Restated Credit Facility Agreement dated as of December 14, 1994, as amended by instrument dated as of April 16, 1998 ("Existing Loan Agreement"). B. Lender and Borrower wish to amend the Existing Loan Agreement and to restate the Existing Loan Agreement in its entirety, all as more fully set forth herein. AGREEMENT DEFINITIONS. As used in this Agreement and the other Documents (as defined below) unless otherwise expressly indicated in this Agreement or the other Documents, the following terms shall have the following meanings (such meanings to

EXHIBIT 10.130 SECOND AMENDED AND RESTATED CREDIT FACILITY AGREEMENT THIS SECOND AMENDED AND RESTATED CREDIT FACILITY AGREEMENT ("Agreement") entered into as of September 14, 1999, by FINOVA CAPITAL CORPORATION, a Delaware corporation, and BLUEGREEN CORPORATION, a Massachusetts corporation. RECITALS A. Lender and Borrower are parties to an Amended and Restated Credit Facility Agreement dated as of December 14, 1994, as amended by instrument dated as of April 16, 1998 ("Existing Loan Agreement"). B. Lender and Borrower wish to amend the Existing Loan Agreement and to restate the Existing Loan Agreement in its entirety, all as more fully set forth herein. AGREEMENT DEFINITIONS. As used in this Agreement and the other Documents (as defined below) unless otherwise expressly indicated in this Agreement or the other Documents, the following terms shall have the following meanings (such meanings to be applicable equally both to the singular and plural terms defined). 1.1 "Acquisition/Refinancing Advance": with respect to a Loan, an Advance of the Loan made solely for the purpose of paying, reimbursing Borrower for, or refinancing the Acquisition Cost of Real Property which is the subject of the Loan under which the Advance is made. 1.2 "Acquisition/Refinancing Cost": with respect to any Real Property, its actual purchase price, together with all reasonable and ordinary due diligence expenses incurred in connection with the acquisition of the Real Property and all reasonable and ordinary closing costs incurred in connection of the Real Property in the refinancing of such acquisition. 1.3 "Acquisition/Refinancing Loan": a Loan which is disbursed in a single Advance and is made solely for the purpose of paying, or reimbursing the Borrower under the Loan for, the Acquisition Cost of the Real Property which is the subject of such Loan. 1.4 "Advance": an advance of the proceeds of a Loan by Lender to a Borrower in accordance with the terms and conditions of this Agreement. 1.5 "Advance Formula for Acquisition/Refinancing Advance": with respect to any Real Property, an amount equal to eighty percent (80%) of the lesser of (a) its Acquisition Cost or (b) its Appraised Value; provided that if an appraisal is not required pursuant to paragraph 4.2(b), then the Advance Formula shall be an amount equal to eighty percent (80%) of the Acquisition Cost. -1-

1.6 "Affidavit of Borrower": a sworn Affidavit of Borrower (and such other parties as Lender may require) in the form of EXHIBIT G-3, to accompany a Work-Related Advance Request. 1.7 "Affiliate": with respect to any individual or entity, any other individual or entity that directly or indirectly, through one or more intermediaries, controls, is controlled by or is under common control with such individual or entity. 1.8 "Agreement": this Amended and Restated Credit Facility Agreement, as it may be from time to time renewed, amended, restated or replaced.

1.6 "Affidavit of Borrower": a sworn Affidavit of Borrower (and such other parties as Lender may require) in the form of EXHIBIT G-3, to accompany a Work-Related Advance Request. 1.7 "Affiliate": with respect to any individual or entity, any other individual or entity that directly or indirectly, through one or more intermediaries, controls, is controlled by or is under common control with such individual or entity. 1.8 "Agreement": this Amended and Restated Credit Facility Agreement, as it may be from time to time renewed, amended, restated or replaced. 1.9 "Applicable Usury Law": the usury law chosen by the parties pursuant to the terms of paragraph 8.10 or such other usury law which is applicable if such usury law is not. 1.10 "Appraised Value": with respect to any Real Property, its fair market value as reported in the appraisal required pursuant to paragraph 4.2(b) and approved by Lender. 1.11 "Architect/Engineer": with respect to any Improvements, an architect, design professional or engineer employed by a Borrower to perform architectural, design or engineering services in connection with such Improvements. 1.12 "Architect/Engineer Agreement": with respect to the Improvements being financed in whole or in part under a Development Loan and the Work related thereto, a contract (written or oral, now or hereafter in effect) between the Borrower under the Development Loan and an Architect/Engineer for the performance of architectural, design or engineering services in connection with such Improvements, as approved by Lender in writing and modified from time to time in accordance with the terms of the Documents. 1.13 "Articles of Organization": the charter, articles, operating agreement, partnership agreement, by-laws and any other written documents evidencing the formation, organization and continuing existence of an entity. 1.14 "Assignment(s)": with respect to a Loan, collectively, a written assignment or assignments, as such assignments may be from time to time renewed, amended, restated or replaced, each of which may be separate from and/or included within the other Loan Security Documents for the Loan executed or to be executed and delivered to Lender by the Borrower under such Loan and creating in favor of Lender, to facilitate Performance of the Obligations of such Borrower (subject only to the Permitted Encumbrances), a perfected, direct, first and exclusive assignment of the following: all leases, sales contracts, rents and sales and other proceeds pertaining to or arising from the Real Property which is the subject of such Loan or any business of such Borrower conducted thereon or with respect thereto; all management, operating and service contract pertaining to such Real Property; the Developer's Rights with respect to such Real Property; and all other Contracts, Licenses, Permits and Other Intangibles related to such Real Property (including, without limitation, Architect/Engineer Agreements and Construction Contracts if the Loan is a Development Loan). 1.15 "Bluegreen Entity": Parent or a Subsidiary. -2-

1.16 "Borrower": with respect to a Loan, the Bluegreen Entity which has requested the Loan and to whom the Loan is to be or has been made owns the fee simple interest in the Real Property which is the subject of the Loan and is the seller of Parcels of such Real Property. 1.17 "Borrowing Term": subject to the provisions of paragraph 2.2, the period during which a Bluegreen Entity may obtain a Loan, commencing on the date of this Agreement and ending on March 31, 2002. 1.18 "Business Day": any day other than a Saturday, a Sunday or a day on which banks in Phoenix, Arizona are required to be closed. 1.19 "Collateral": all Real Property, Personal Property, Insurance Policies and other property now or hereafter serving as security for the Performance of any portion of the Obligations, and all products and proceeds thereof.

1.16 "Borrower": with respect to a Loan, the Bluegreen Entity which has requested the Loan and to whom the Loan is to be or has been made owns the fee simple interest in the Real Property which is the subject of the Loan and is the seller of Parcels of such Real Property. 1.17 "Borrowing Term": subject to the provisions of paragraph 2.2, the period during which a Bluegreen Entity may obtain a Loan, commencing on the date of this Agreement and ending on March 31, 2002. 1.18 "Business Day": any day other than a Saturday, a Sunday or a day on which banks in Phoenix, Arizona are required to be closed. 1.19 "Collateral": all Real Property, Personal Property, Insurance Policies and other property now or hereafter serving as security for the Performance of any portion of the Obligations, and all products and proceeds thereof. 1.20 "Completion": with respect to the Work being done in connection with the Improvements being financed in whole or in part under a Development Loan, the occurrence, after Substantial Completion of such Work, of the following: (a) final completion of such Work (including "punch-list" items), in accordance with the related Plans and Specifications, the related Construction Contract(s), all applicable Legal Requirements, the Loan Documents for the Development Loan, sound construction, engineering and architectural principles and commonly accepted safety-standards, free of liens and free of defective materials and workmanship; (b) receipt by Lender of the following in form and substance satisfactory to it: (i) a certificate of completion from the Borrower under the Development Loan, from Architect(s)/Engineer(s) for such Improvements who are designated by Lender, and, if Lender elects, from Lender's Inspector for such Development Loan to the effect that such Work has been so completed and final payment is due under all related Construction Contracts between the Borrower under the Development Loan and Contractors; (ii) final lien waivers for such Work; and (iii) the title policy endorsements required in connection with such event pursuant to the terms of the Loan Documents for such Loan after final completion of such Work; and (c) expiration of the statutory period in which mechanics' liens and similar liens can be filed on account of such Work. 1.21 "Construction Budget": with respect to a Development Loan or the Work being done in connection with the Improvements being financed in whole or in part under a Development Loan, a detailed budget cost itemization prepared by the Borrower under the Development Loan and approved in writing by Lender, which specifies by item the cost and source of payment of: (a) all labor, materials and services necessary for Completion of such Work in accordance with the related Plans and Specifications, the related Construction Contract(s), the Loan Documents for the Development Loan, all Legal Requirements, sound construction, engineering and architectural principles, and commonly accepted safety standards; (b) interest on the Development Loan; and (c) all other expenses incidental to Completion of such Work. The Construction Budget for each Development Loan shall include within the costs of the Work to be paid from the Development Loan a contingency reserve determined to be adequate by Lender. Without limiting Lender's discretion in approving the Construction Budget for a Development Loan, Lender shall be satisfied that any "construction overhead" contained therein does not constitute a developer fee of any kind. -3-

1.22 "Construction Contract": with respect to the Work being done in connection with the Improvements being financed in whole or in part under a Development Loan, a contract (written or oral, now or hereafter in effect) between Borrower and a Contractor, between a Contractor and any other person or entity relating in any way to the construction of such Work, including the performing of labor and the furnishing of equipment, materials or services (other than architectural, design or engineering services), as approved by Lender in writing and modified from time to time. 1.23 "Contractor": with respect to the Work being done in connection with the Improvements being financed in whole or in part under a Development Loan, a contractor employed by a Borrower to provide labor and/or to

1.22 "Construction Contract": with respect to the Work being done in connection with the Improvements being financed in whole or in part under a Development Loan, a contract (written or oral, now or hereafter in effect) between Borrower and a Contractor, between a Contractor and any other person or entity relating in any way to the construction of such Work, including the performing of labor and the furnishing of equipment, materials or services (other than architectural, design or engineering services), as approved by Lender in writing and modified from time to time. 1.23 "Contractor": with respect to the Work being done in connection with the Improvements being financed in whole or in part under a Development Loan, a contractor employed by a Borrower to provide labor and/or to furnish equipment, materials or services (other than architectural, design or engineering services) for any portion of such Work. 1.24 "Contracts, Licenses, Permits and Other Intangibles": with respect to any Real Property, the property so described in EXHIBIT A. 1.25 "Credit Facility": the credit facility made available pursuant to this Agreement. 1.26 "Default Rate": with respect to Loan Obligations under the Loan Documents for a Loan, the meaning given to it in the Note evidencing such Loan; and otherwise the highest Default Rate under the Notes. 1.27 "Developer's Rights": with respect to any Real Property which is the subject of a Loan, all special rights and privileges of the Borrower under the Loan under any declaration of covenants, conditions and restrictions and/or other documents governing the Real Property which are not enjoyed by all other owners of portions of the Real Property. 1.28 "Development Loan": a Loan made for the purpose of paying or reimbursing a Borrower the Loan for the costs of constructing Improvements on the Real Property which is the subject of the Loan and otherwise performing Work with respect to such Improvements; provided, however, that a Development Loan may also include an Acquisition/Refinancing Advance. 1.29 "Development Loan Advance": an Advance of a Development Loan. 1.30 "Development Loan Borrowing Term": with respect to a Development Loan, the period during which the Borrower under the Development Loan may obtain Development Loan Advances under such Development Loan, which period shall commence when all conditions precedent to the initial Development Loan Advance under such Development Loan have been satisfied and terminating on the Required Completion Date for the Improvements being financed in whole or in part under such Development Loan. 1.31 "Documents": the Loan Documents for all Loans. -4-

1.32 "Environmental Certificate": with respect to a Loan, a certificate executed by the Borrower under the Loan in form and substance satisfactory to Lender, and containing representations, warranties and covenants regarding the environmental condition of the Real Property which is the subject of the Loan. 1.33 "Event of Default": the meaning set forth in paragraph 7.1. 1.34 "Force Majeure Event": with respect to the Work being done in connection with Improvements being financed in whole or in part under a Development Loan, an "act of God," a fire, a strike, a governmental order and/or injunction which is issued by a court of competent jurisdiction for reasons other than for the acts or omissions or omissions of the Borrower under the Development Loan which would constitute a default under this Agreement, or a similar event beyond the reasonable control of the Borrower under the Development Loan. 1.35 "Guaranty": with respect to a Loan made to a Subsidiary, a primary, joint and several guaranty made by Parent guarantying the repayment of the Loan, together with interest thereon as provided in the Note evidencing the Loan, and the payment and performance of all other Loan Obligations under the related Loan Documents.

1.32 "Environmental Certificate": with respect to a Loan, a certificate executed by the Borrower under the Loan in form and substance satisfactory to Lender, and containing representations, warranties and covenants regarding the environmental condition of the Real Property which is the subject of the Loan. 1.33 "Event of Default": the meaning set forth in paragraph 7.1. 1.34 "Force Majeure Event": with respect to the Work being done in connection with Improvements being financed in whole or in part under a Development Loan, an "act of God," a fire, a strike, a governmental order and/or injunction which is issued by a court of competent jurisdiction for reasons other than for the acts or omissions or omissions of the Borrower under the Development Loan which would constitute a default under this Agreement, or a similar event beyond the reasonable control of the Borrower under the Development Loan. 1.35 "Guaranty": with respect to a Loan made to a Subsidiary, a primary, joint and several guaranty made by Parent guarantying the repayment of the Loan, together with interest thereon as provided in the Note evidencing the Loan, and the payment and performance of all other Loan Obligations under the related Loan Documents. 1.36 "Improvements": with respect to a Development Loan, the infrastructure improvements (on-site or off-site) to be constructed upon, added to or made to or for the benefit of the Real Property which is the subject of the Development Loan, all as more fully set forth in the related Plans and Specifications and the related Construction Budget. 1.37 "Incipient Default": an event which after notice and/or lapse of time would constitute an Event of Default. 1.38 "Insurance Policies": the insurance policies that a Borrower is required to maintain and deliver pursuant to paragraph 6.5. 1.39 "Interest Reserve Advance": with respect to a Development Loan, an Advance of the Development Loan made to pay accrued and unpaid interest on any portion of the Development Loan. 1.40 "Interest Reserve Fund": with respect to a Development Loan, that portion of the Development Loan which is allocated within the related Construction Budget for the monthly payment of interest on the Development Loan. 1.41 "Legal Requirements": with respect to the Borrower under a Loan, the Loan Collateral for such Loan, the Improvements (if any) being financed in whole or in part under such Loan, the Work being done in connection with the Loan, or otherwise with respect to such Loan: (a) all present and future judicial decisions, statutes, regulations, permits or certificates of any governmental authority in any way applicable to the Borrower or the Loan Collateral; (b) all covenants, conditions and restrictions contained in any document by which the Loan Collateral is bound; (c) all business association agreements forming, or granting and/or limiting the powers of, the Borrower; and (d) all contracts or agreements (written or oral) by which the Borrower is bound or, if compliance therewith would otherwise be in conflict with any of the Loan Documents for the Loan, by which the Borrower becomes bound with Lender's prior written consent. -5-

1.42 "Lender": FINOVA Capital Corporation, a Delaware corporation, and its successors and assigns. 1.43 "Lender's Inspector": with respect to a Development Loan, the architectural or engineering firm retained by Lender pursuant to paragraph 9.1 in connection with such Loan. 1.44 "Loan": an Acquisition/Refinancing Loan or a Development Loan. 1.45 "Loan Collateral": with respect to a Loan, the Real Property which is the subject of such Loan, the Personal Property related thereto, and the other property now or hereafter as security for the Performance of the Loan Collateral, except for property which is security for the performance of the Loan obligations solely by virtue of paragraph 10.1 or a similar paragraph. 1.46 "Loan Documents": with respect to a Loan, this Agreement and all Request for Advance, Note, Mortgage,

1.42 "Lender": FINOVA Capital Corporation, a Delaware corporation, and its successors and assigns. 1.43 "Lender's Inspector": with respect to a Development Loan, the architectural or engineering firm retained by Lender pursuant to paragraph 9.1 in connection with such Loan. 1.44 "Loan": an Acquisition/Refinancing Loan or a Development Loan. 1.45 "Loan Collateral": with respect to a Loan, the Real Property which is the subject of such Loan, the Personal Property related thereto, and the other property now or hereafter as security for the Performance of the Loan Collateral, except for property which is security for the performance of the Loan obligations solely by virtue of paragraph 10.1 or a similar paragraph. 1.46 "Loan Documents": with respect to a Loan, this Agreement and all Request for Advance, Note, Mortgage, Security Agreement, Assignments, Environmental Certificate, and other documents now or hereafter executed in connection with the Loan, as they may be from time to time renewed, amended, restated or replaced. 1.47 "Loan Obligations": with respect to a Loan, all obligations, agreements, duties, covenants and conditions that the Borrower under the Loan is required to perform under the Loan Documents for such Loan. 1.48 Loan Security Documents": with respect to a Loan, the Mortgage, Security Agreement and other documents from time to time delivered to Lender to create or perfect a Security Interest in the Loan Collateral, as they may be from time to time renewed, amended, restated or replaced. 1.49 "Maturity Date": with respect to a Loan, the date determined by Lender prior to the initial Advance of the Loan and so identified in the Note evidencing the Loan, but in no event later than the date forty-eight (48) months after the initial Advance of the Loan unless agreed to by Lender and set forth in the Note evidencing the Loan. 1.50 "Maximum Credit Facility Amount": at anytime, the positive difference between Thirty-Five Million Dollars ($35,000,000). 1.51 "Maximum Loan Amount": (a) with respect to an Acquisition/Refinancing Loan, an amount equal to the lesser of (i) the amount requested by the Borrower under the Acquisition/Refinancing Loan or (ii) the Advance Formula of the Real Property which is the subject of the Acquisition/Refinancing Loan; and (b) with respect to a Development Loan, an amount determined by Lender prior to the initial Development Loan Advance, but in no event to exceed the least of (i) the amount requested by the Borrower under the Development Loan, (ii) (A) eighty percent (80%) of the cost, as shown on the original related Construction Budget, of Completion of the Work being done in connection with the Work being financed in whole or in part under the Development Loan plus (B) if there -6-

is an Acquisition/Refinancing Advance, an amount determined in accordance with the Advance Formula for Acquisition/Refinancing Advance with respect to the Real Property which is the subject of the Development Loan, or (iii) eighty percent (80%) of the Appraised Value of the Real Property which is the subject of the Development Loan, determined as if Completion of the Work being financed in whole or in part under the Development Loan had occurred. 1.52 "Mortgage": with respect to a Loan, a mortgage, deed of trust or deed to secure debt, as required by Lender, executed by the Borrower under the Loan and under the terms of which the Borrower has conveyed or granted in favor of Lender, as security for Performance of the Loan Obligations under the Loan Documents for such Loan (subject only to the Permitted Encumbrances), a perfected, direct, first and exclusive priority lien, upon the Real Property which is the subject of the Loan, as it may be from time to time renewed, amended, restated or replaced. 1.53 "Note": with respect to a Loan, the promissory note issued in the form of EXHIBIT B by the Borrower under the Loan to evidence the Advance(s) of the Loan which has been obtained by or committed to such

is an Acquisition/Refinancing Advance, an amount determined in accordance with the Advance Formula for Acquisition/Refinancing Advance with respect to the Real Property which is the subject of the Development Loan, or (iii) eighty percent (80%) of the Appraised Value of the Real Property which is the subject of the Development Loan, determined as if Completion of the Work being financed in whole or in part under the Development Loan had occurred. 1.52 "Mortgage": with respect to a Loan, a mortgage, deed of trust or deed to secure debt, as required by Lender, executed by the Borrower under the Loan and under the terms of which the Borrower has conveyed or granted in favor of Lender, as security for Performance of the Loan Obligations under the Loan Documents for such Loan (subject only to the Permitted Encumbrances), a perfected, direct, first and exclusive priority lien, upon the Real Property which is the subject of the Loan, as it may be from time to time renewed, amended, restated or replaced. 1.53 "Note": with respect to a Loan, the promissory note issued in the form of EXHIBIT B by the Borrower under the Loan to evidence the Advance(s) of the Loan which has been obtained by or committed to such Borrower, as it may be from time to time renewed, amended, restated or replaced. 1.54 "Obligations": the Loan Obligations under the Documents. 1.55 "Parcels": the meaning given to it in paragraph 3.2(a). 1.56 "Parent": Bluegreen Corporation, a Massachusetts corporation. 1.57 "Partial Release": the meaning given to it in paragraph 3.2(a). 1.58 "Partial Release Payment": the meaning give to it in paragraph 3.3. 1.59 "Performance" or "Perform": full, timely and faithful performance. 1.60 "Permitted Encumbrances": with respect to any Property, rights, restrictions, reservations, easements and liens of record which do not materially adversely lessen the value or affect the use of such Property for purposes approved by Lender and Lender has agreed in writing to accept, but excluding monetary liens other than liens for taxes and assessments not yet due and payable and inchoate artisans' liens and mechanics' liens for amounts not yet due and payable. 1.61 "Personal Property": with respect to the Real Property which is the subject of a Loan, the property described in EXHIBIT A. 1.62 "Plans and Specifications": with respect to the Improvements being financed in whole or in part under a Development Loan, the architectural, structural, mechanical, electrical and other plans and specifications for the construction of such Improvements and the completion of the rest of the Work related thereto prepared by Architect(s)/Engineer(s) engaged by the Borrower under the Development Loan to do so, as approved by Lender as modified from time to time with Lender's prior written consent. -7-

1.63 "Principal Work-Related Items": with respect to the Improvements being financed in whole or in part under a Development Loan and related Work, the related Plans and Specifications and all agreements between the Borrower under the Development Loan and third parties pertaining to such Improvements and Work, as approved by Lender in writing and modified from time to time in accordance with the terms of the Loan Documents for such Development Loan, including, without limitation, the related Construction Contract(s) and Architect/Engineer Agreement(s). 1.64 "Property": with respect to a Loan, the Real Property which is the subject of the Loan and the Personal Property related to such Real Property.

1.63 "Principal Work-Related Items": with respect to the Improvements being financed in whole or in part under a Development Loan and related Work, the related Plans and Specifications and all agreements between the Borrower under the Development Loan and third parties pertaining to such Improvements and Work, as approved by Lender in writing and modified from time to time in accordance with the terms of the Loan Documents for such Development Loan, including, without limitation, the related Construction Contract(s) and Architect/Engineer Agreement(s). 1.64 "Property": with respect to a Loan, the Real Property which is the subject of the Loan and the Personal Property related to such Real Property. 1.65 "Qualified Real Property": real property which meets the criteria set forth in EXHIBIT C. "Real Property": with respect to a Loan, the real property which is the subject of the Loan. 1.66 "Request for Advance": with respect to an Acquisition/Refinancing Advance, the request for the Advance executed by the Borrower under the Loan pursuant to which the Acquisition/Refinancing Advance is being made and in form and substance identical to EXHIBIT D-1 OR D-2, as applicable; and with respect to a WorkRelated Advance, a Work-Related Advance Request. 1.67 "Required Completion Assurance Deposit": with respect to the Uncovered Cost of Work being done in connection with the Improvements being financed in whole or in part under a Development Loan, a cash deposit (to be made by the Borrower under the Development Loan and held by Lender) in an amount equal to such Uncovered Cost of Work. 1.68 "Required Completion Date": with respect to the Work being done in connection with Improvements being financed in whole or in part under a Development Loan, the date determined by Lender prior to the initial Advance of the Development Loan and so identified in the Request for Advance executed in connection with such Advance, plus such additional time which is necessary to achieve Completion of such Work and results solely from the occurrence of one or more Force Majeure Events. 1.69 "Resolution": a resolution of a corporation certified as true and correct by an authorized officer of such corporation, a certificate signed by the manager of a limited liability company and/or such members whose approval is required under the applicable Articles of Organization, or a partnership certificate signed by all of the general partners of such partnership and such other partners whose approval is required under the applicable Articles of Organization. 1.70 "Security Agreement": with respect to a Loan, collectively, a written security agreement or security agreements which may be separate from and/or included within the Mortgage for the Loan or this Agreement, executed and delivered (or to be executed and delivered) by the Borrower under the Loan and creating in favor of Lender, as security for the Performance of the Loan Obligations under the Loan Documents for the Loan (subject only to the Permitted Encumbrances), a perfected, direct, first and exclusive security interest, in the Personal Property related to the Real Property which is the subject of the Loan, as it may be from time to time renewed, amended, restated or replaced. -8-

1.71 "Security Documents": the Loan Security Documents for all Loans. 1.72 "Security Interest": with respect to any property, a perfected, direct and exclusive first priority lien on, security interest in, assignment of or other charge , as the case may be, subject only to the Permitted Encumbrances. 1.73 "Subsidiary": a wholly-owned subsidiary of Parent. 1.74 "Substantial Completion": with respect to the Work being done in connection with Improvements being financed in whole or in part under a Development Loan, the occurrence of:

1.71 "Security Documents": the Loan Security Documents for all Loans. 1.72 "Security Interest": with respect to any property, a perfected, direct and exclusive first priority lien on, security interest in, assignment of or other charge , as the case may be, subject only to the Permitted Encumbrances. 1.73 "Subsidiary": a wholly-owned subsidiary of Parent. 1.74 "Substantial Completion": with respect to the Work being done in connection with Improvements being financed in whole or in part under a Development Loan, the occurrence of: (a) substantial completion (as defined in AIA Document A201, most current version) of such Work, in accordance with the related Plans and Specifications, the related Construction Contract(s), all applicable Legal Requirements, the Loan Documents for the Development Loan, sound construction, engineering and architectural principles and commonly accepted safety-standards, free of liens and free of defective materials and workmanship; (b) receipt by Lender of the following in form and substance satisfactory to it: (i) a certificate of substantial completion from the Borrower under such Loan, from the Architect(s)/ Engineer(s) for the Improvements who are designated by Lender and, if Lender elects, from Lender's Inspector for such Development Loan to the effect that such Work has been so completed, and final payment is due under all related Construction Contracts between the Borrower under the Development Loan and Contractors (subject only to retention for "punch-list" items); (ii) a certificate of completion or acceptance (or its equivalent) from the appropriate governmental authority having jurisdiction over such Work which has the effect of allowing the use of the Improvements constructed as part of such Work for the intended purposes, to the extent such a certificate is customarily issued or available; (iii) if applicable Legal Requirements provide that the recording of a notice of completion will cause the expiration upon a date certain of the statutory period within which mechanics' and similar liens can be filed, verification of the recording of such notice in the manner prescribed by such Legal Requirements; (iv) final lien waivers, other than lien waivers for that portion of such Work remaining to be performed prior to Completion and for which Lender is still holding Basic Retainage [as defined in paragraph 2.1(a)] or Additional Retainage [as defined in paragraph 2.1(a)] sufficient to cover such Work; (v) the as-built survey required in connection with such event pursuant to the terms of the Loan Documents for the Development Loan; (vi) the title policy endorsements required in connection with such event pursuant to the terms of the Loan Documents for the Development Loan; and (vii) if such Improvements were intended to be dedicated to a governmental authority, evidence that such dedication has occurred and that the governmental authority has accepted such Improvements, subject only to customary warranty obligations on the part of the Borrower under the Development Loan. -9-

1.75 "Tangible Personal Property": with respect to any Real Property, that portion of the related Personal Property described in paragraph 3 of EXHIBIT A. 1.76 "Term": the duration of this Agreement, commencing on the date as of which this Agreement is entered into and ending when all of the Obligations shall have been Performed. 1.77 "Third Party Consents": with respect to a Loan, those consents which Lender requires the Borrower under such Loan to obtain, or which such Borrower or (if not the Borrower) Parent is contractually or legally obligated to obtain, from others in connection with the making of the Loan or the Performance of such entity's Loan Obligations under the Loan Documents for the Loan. 1.78 "Threshold Amount": with respect to Parent, Two Hundred Fifty Thousand Dollars ($250,000); and with respect to any Subsidiary, Fifty Thousand Dollars ($50,000). 1.79 "Title Insurer": with respect to a Title Policy, the title insurance company which has issued it.

1.75 "Tangible Personal Property": with respect to any Real Property, that portion of the related Personal Property described in paragraph 3 of EXHIBIT A. 1.76 "Term": the duration of this Agreement, commencing on the date as of which this Agreement is entered into and ending when all of the Obligations shall have been Performed. 1.77 "Third Party Consents": with respect to a Loan, those consents which Lender requires the Borrower under such Loan to obtain, or which such Borrower or (if not the Borrower) Parent is contractually or legally obligated to obtain, from others in connection with the making of the Loan or the Performance of such entity's Loan Obligations under the Loan Documents for the Loan. 1.78 "Threshold Amount": with respect to Parent, Two Hundred Fifty Thousand Dollars ($250,000); and with respect to any Subsidiary, Fifty Thousand Dollars ($50,000). 1.79 "Title Insurer": with respect to a Title Policy, the title insurance company which has issued it. 1.80 "Title Policy": with respect to a Loan, a policy of title insurance which is in an amount not less than the Loan; insures Lender's interest in the Mortgage executed in connection with the Loan as a perfected, direct, first and exclusive lien on the Real Property which is the subject of the Loan, subject only to the Permitted Encumbrances for such Real Property; and is issued by a title insurance company acceptable to Lender. 1.81 "Uncovered Cost of the Work" or "Uncovered Cost": with respect to the Work being done in connection with Improvements being financed in whole or in part under a Development Loan, the amount equal to the excess (if any) of (a) the remaining unpaid cost of Completion of the Work over (b) the undisbursed portion of the Development Loan committed for such Work and the remaining balance of any Required Completion Assurance Deposits held by Lender under the Development Loan for such Work. 1.82 "Work": with respect to a Development Loan, the construction of the Improvements being financed in whole or in part under the Development Loan, as shown on or described in the related Plans and Specifications or the related Construction Contract(s). 1.83 "Work Progress Schedule": with respect to the Work being done in connection with the Improvements being financed in whole or in part under a Development Loan, the schedule for the Completion of the Work and parts thereof, as approved by Lender in writing. 1.84 "Work-Related Advance": a Development Loan Advance made for the purpose of paying or reimbursing the Borrower under the Development Loan for costs of any portion of the Work being done in connection with the Improvements being financed in whole or in part under the Development Loan, excluding interest on the Development Loan. 1.85 "Work-Related Advance Request": with respect to a Development Loan, the written application of the Borrower under the Development Loan made on Lender's standard forms by such Borrower and such other parties as Lender may require specifying by name and amount all parties to whom such Borrower is obligated for labor, materials, equipment or services supplied -10-

for the performance of related Work and all other expenses incidental to the Development Loan, the Real Property which is the subject of the Development Loan and the Completion of the related Work, and requesting a Development Loan Advance for payment of such items, accompanied by an Affidavit of Borrower, certificates of the Architect/Engineers and the Contractors for such Work who are designated by Lender and such schedules, affidavits, certificates, releases, waivers, statements, invoices, bills and other documents as Lender may reasonably request. II. CREDIT FACILITY COMMITMENT; USE OF PROCEEDS.

for the performance of related Work and all other expenses incidental to the Development Loan, the Real Property which is the subject of the Development Loan and the Completion of the related Work, and requesting a Development Loan Advance for payment of such items, accompanied by an Affidavit of Borrower, certificates of the Architect/Engineers and the Contractors for such Work who are designated by Lender and such schedules, affidavits, certificates, releases, waivers, statements, invoices, bills and other documents as Lender may reasonably request. II. CREDIT FACILITY COMMITMENT; USE OF PROCEEDS. 2.1 Credit Facility Commitment. Lender hereby agrees, if all of the Obligations then due to be Performed have been Performed, to make Loans and Advances of such Loans to Bluegreen Entities. Each Acquisition/Refinancing Advance shall be in an amount equal to the lesser of (a) the amount requested by the Borrower under the Loan under which the Acquisition Advance is being made or (b) the Advance Formula of the Real Property which is the subject of the Advance. Subject to the provisions of paragraph 4.7, the amount of each Interest Reserve Advance under a Development Loan shall be in the amount of interest then accrued and unpaid on the portion of the Development Loan for which payment of interest is allocated within the related Construction Budget. The amount of each Work-Related Advance under a Development Loan shall be equal to the costs of the Work covered by the applicable Work-Related Advance Request and allocated within the related Construction Budget for payment out of the Development Loan less an amount equal to the sum of (a) an amount ("Basic Retainage") equal to ten percent (10%) of the "hard" costs of such Work and (b) any additional retainage in excess of the amount of the Basic Retainage ("Additional Retainage") required under the related Construction Contract(s); provided, however, that Work-Related Advances shall not be made under a Development Loan for stored or ordered materials not yet incorporated into the Improvements being financed in whole or in part under the Development Loan. The Basic Retainage from a Work-Related Advance Request shall apply only to "hard" costs of the Work covered by such Work-Related Advance Request. The Additional Retainage from Work-Related Advance Requests under a Development Loan shall be disbursed as part of the next Advance under the Development Loan occurring after Lender has reasonably determined that a Contractor is entitled to it under a related Construction Contract. The Basic Retainage Work-Related Advances under a Development Loan shall be disbursed at the time of Substantial Completion of the Work being done in connection with the Improvements being financed in whole or in part under the Development Loan to the extent Contractor(s) who have performed such Work are then entitled to it under the related Construction Contract(s), subject to Lender's right to keep such portion of the Basic Retainage under the Development Loan as it may determine to be necessary to ensure Completion of such Work being done in whole or in part in connection with the Improvements being financed in whole or in part under the Construction Loan, with such retained portion to be disbursed promptly after Completion of the such Work. Lender shall have no obligation to make a Development Loan Advance if, after giving effect to such Development Loan Advance, the sum of (a) the unpaid principal balance of the Development Loan under which the Development Loan Advance is to be made, (b) the committed and undisbursed portion of such Development Loan, and (c) the Uncovered Cost of the Work being done in connection with the Improvements being financed under such Development Loan exceeds the Maximum Loan Amount for such Development Loan. Lender shall have no obligation to make an Advance of a Loan if, after giving effect to such Advance, the sum of (a) the unpaid principal balance of the Loans, (b) the committed and undisbursed portion of the Loans, and (c) the Uncovered Cost of the Work being financed in whole or in part under all Development Loans exceeds the Maximum Credit Facility Amount. -11-

2.2 Revolving Credit Facility. Subject to the terms of the following sentence, the Credit Facility is a revolving line of credit (i.e., Advances may be obtained against Real Property; and as those Advances are repaid, other Advances may be obtained). Only one Advance may be obtained under the Credit Facility for the purpose of paying or reimbursing any Bluegreen Entity for the Acquisition/Refinancing Cost of the same Real Property; only one Development Loan may be obtained under the Credit Facility for the purposes of paying or reimbursing any Borrower for "hard" and "soft" costs of the Work performed on the same Real Property; and the total Advances under a Loan may not exceed the Maximum Loan Amount for such Loan. Each Loan shall be viewed as a separate loan. Bluegreen Entities shall not be entitled to obtain Loans after the expiration of the Borrowing Term unless Lender agrees in writing with Parent to make Loans thereafter on terms and conditions satisfactory to Lender. Subject to the provisions of paragraph 4.7, a Borrower under a Development Loan may not obtain a Development Loan Advance under the Development Loan after the Development Loan Borrowing Term for such

2.2 Revolving Credit Facility. Subject to the terms of the following sentence, the Credit Facility is a revolving line of credit (i.e., Advances may be obtained against Real Property; and as those Advances are repaid, other Advances may be obtained). Only one Advance may be obtained under the Credit Facility for the purpose of paying or reimbursing any Bluegreen Entity for the Acquisition/Refinancing Cost of the same Real Property; only one Development Loan may be obtained under the Credit Facility for the purposes of paying or reimbursing any Borrower for "hard" and "soft" costs of the Work performed on the same Real Property; and the total Advances under a Loan may not exceed the Maximum Loan Amount for such Loan. Each Loan shall be viewed as a separate loan. Bluegreen Entities shall not be entitled to obtain Loans after the expiration of the Borrowing Term unless Lender agrees in writing with Parent to make Loans thereafter on terms and conditions satisfactory to Lender. Subject to the provisions of paragraph 4.7, a Borrower under a Development Loan may not obtain a Development Loan Advance under the Development Loan after the Development Loan Borrowing Term for such Development Loan has expired unless Lender agrees in writing with such Borrower to do so. 2.3 Use of Advances. Parent will use the proceeds of each Advance made to it as a Borrower, and will cause each Subsidiary which is a Borrower, to use the proceeds of each Advance made to such Subsidiary only for the following purposes: if an Acquisition/Refinancing Advance, to pay (or reimburse the Borrower for) the Acquisition Cost of the related Real Property which is the subject of the Loan under which the Advance is made; and if a Development Advance, to pay (or reimburse the Borrower for) "hard" and "soft" costs of the related Work; provided, however, that proceeds of a Loan disbursed to the Borrower under the Loan in reimbursement of costs paid to it may be used by the Borrower for any lawful purpose. If the amount needed by the Borrower under a Development Loan for any line-item expense set forth in the Construction Budget for the Development Loan is less than the budgeted amount to be paid from such Development Loan for the line-item expense, such excess may be reallocated to other line items in such Construction Budget, as approved by Lender in writing. Notwithstanding anything herein to the contrary, Lender shall have no obligation to approve an Interest Reserve Fund for a Development Loan and may approve or disapprove an Interest Reserve Fund for a Development Loan in its discretion. 2.4 Outstanding Loans. Lender and Borrower acknowledge that there is no principal or interest currently outstanding under any Loan. III. SECURITY. 3.1 (a) Maintenance of Security; Cross Collateralization. Parent will and will cause each Subsidiary which is a Borrower under a Loan: to deliver to Lender at the times required pursuant to Article IV, the Guaranties required pursuant to paragraph 4.2 in connection with the Loan, the subordination agreements required pursuant to paragraph 4.2, the Loan Security Documents required pursuant to paragraph 4.2 and all other security required to be given to Lender by such entity pursuant to the terms of this Agreement; and, subject to the provisions of the last sentence of this paragraph, to maintain such Loan Documents in full force -12-

and effect until Borrower has Performed all Loan Obligations under the Loan Documents for the Loan (except as otherwise expressly provided in such Loan Documents or this Agreement). The Loan Security Documents executed by a Borrower in connection with a Loan shall, at Lender's option, secure the repayment of all other Loans made to such Borrower and the payment and Performance of all other Obligations of such Borrower under the Loan Documents for such other Loans; and in the case of Parent shall secure the other Obligations described in paragraph 9.1. However, if neither an Event of Default nor an Incipient Default then exists under any Document executed by such Borrower, the Loan Security Documents executed by a Borrower in connection with a Loan shall be released when the Loan Obligations (other than those arising from a cross-collateralization provision) under the Loan Documents for the Loan have been paid and Performed in full and no default exists under any other obligation owing to Lender which is secured under such Loan Security Documents. 3.2 (a) Sale of Parcels; Partial Release of Parcels. The Borrower under a Loan may enter into a contract for the sale of portions ("Parcels") of the Real Property which is the subject of the Loan so long as the contract is entered into in good faith in the ordinary course of such Borrower's business when no Event of Default exists, the transaction complies with applicable laws and, until closing of the contract, the contract is subject to the terms and conditions of the Loan Security Documents for such Loan. Such Borrower shall be entitled to close a

and effect until Borrower has Performed all Loan Obligations under the Loan Documents for the Loan (except as otherwise expressly provided in such Loan Documents or this Agreement). The Loan Security Documents executed by a Borrower in connection with a Loan shall, at Lender's option, secure the repayment of all other Loans made to such Borrower and the payment and Performance of all other Obligations of such Borrower under the Loan Documents for such other Loans; and in the case of Parent shall secure the other Obligations described in paragraph 9.1. However, if neither an Event of Default nor an Incipient Default then exists under any Document executed by such Borrower, the Loan Security Documents executed by a Borrower in connection with a Loan shall be released when the Loan Obligations (other than those arising from a cross-collateralization provision) under the Loan Documents for the Loan have been paid and Performed in full and no default exists under any other obligation owing to Lender which is secured under such Loan Security Documents. 3.2 (a) Sale of Parcels; Partial Release of Parcels. The Borrower under a Loan may enter into a contract for the sale of portions ("Parcels") of the Real Property which is the subject of the Loan so long as the contract is entered into in good faith in the ordinary course of such Borrower's business when no Event of Default exists, the transaction complies with applicable laws and, until closing of the contract, the contract is subject to the terms and conditions of the Loan Security Documents for such Loan. Such Borrower shall be entitled to close a contract entered into satisfying the conditions of the preceding sentence and to have the Parcel being sold and other Loan Collateral exclusively-related to such Parcel released from the effect of the Mortgage for the Loan and other applicable Loan Security Documents encumbering such Property if (but only if): (i) neither an Event of Default nor Incipient Default exists at the time of such partial release ("Partial Release"); (ii) the Parcel requested to be released ("Release Parcel") is a legally subdivided parcel and Lender has received adequate evidence thereof; (iii) the Borrower shall have delivered to Lender a written request for a partial release of the Release Parcel from the Mortgage, which request shall specify a date for the consummation of the proposed Partial Release ("Partial Release Date"); (iv) the Borrower shall have delivered to Lender for execution by Lender a partial release/deed of release and reconveyance of the Mortgage which is in recordable form, contains an appropriate legal description of the proposed Release Parcel and is otherwise in form and substance satisfactory to Lender; (v) unless (i) waived in writing by Lender or (ii) the Release Parcel is a platted single-family residential lot and a copy of the plat for the subdivision in which such Release Parcel is located has been delivered to and approved by Lender (such approval not to be unreasonably withheld), the Borrower shall have delivered to Lender a 1992 ALTA/ACSM survey certified to Lender and prepared by a land surveyor reasonably satisfactory to Lender showing the Release Parcel and the Real Property remaining subject to the lien of the Mortgage immediately after giving effect to the Partial Release; -13-

(vi) the Partial Release shall not impair or adversely affect Lender's security in the Real Property remaining subject to the lien of the Mortgage immediately after giving effect to the Partial Release or any provision of the Mortgage as it pertains to the remaining Real Property; and without limiting the generality of the foregoing, unless the Release Parcel is a platted single-family residential lot and a copy of the plat for which such Release Parcel is located has been delivered to and approved by Lender (such approval not to be unreasonably withheld), Lender shall be entitled at the time of the Partial Release to have the Release Parcel made subject to such easements and restrictive covenants as Lender may reasonably determine to be necessary for the benefit of the Real Property remaining subject to the Mortgage; (vii) unless it has previously delivered the items to Lender, the Borrower shall have delivered to Lender and Lender shall have approved in writing a written plan with respect to the development of the Real Property, the size and anticipated sales prices of Parcels to be released, and the pattern in which Partial Releases of Parcels is to occur; and (viii) the Borrower has paid, or simultaneously with the Partial Release will pay, the applicable Partial Release

(vi) the Partial Release shall not impair or adversely affect Lender's security in the Real Property remaining subject to the lien of the Mortgage immediately after giving effect to the Partial Release or any provision of the Mortgage as it pertains to the remaining Real Property; and without limiting the generality of the foregoing, unless the Release Parcel is a platted single-family residential lot and a copy of the plat for which such Release Parcel is located has been delivered to and approved by Lender (such approval not to be unreasonably withheld), Lender shall be entitled at the time of the Partial Release to have the Release Parcel made subject to such easements and restrictive covenants as Lender may reasonably determine to be necessary for the benefit of the Real Property remaining subject to the Mortgage; (vii) unless it has previously delivered the items to Lender, the Borrower shall have delivered to Lender and Lender shall have approved in writing a written plan with respect to the development of the Real Property, the size and anticipated sales prices of Parcels to be released, and the pattern in which Partial Releases of Parcels is to occur; and (viii) the Borrower has paid, or simultaneously with the Partial Release will pay, the applicable Partial Release Payment and all recording and escrow fees and other reasonable out-of-pocket expenses of Lender incurred in connection with the Partial Release of the Release Parcel and any other exclusively-related Property. If the preceding sentence does not specify another date by which items must be delivered to Lender, such items shall be delivered to Lender at least five (5) Business Days prior to the Partial Release Date. Notwithstanding anything herein to the contrary, Lender shall not be obligated to partially release Parcels more than once per week. (b) Partial Release of Related Property. Notwithstanding anything in the Documents to the contrary, if a partial release document is executed for a Release Parcel by Lender and recorded in the real estate records where the Mortgage encumbering it is recorded and Lender receives the applicable Partial Release Payment, there shall ipso facto be released from the lien, assignment and security interest of the Security Documents: (a) so long as no Event of Default then exists, any contract for the sale of such Release Parcel by the Borrower entitled to the Partial Release of the Release Parcel, all instruments, chattel paper and general intangibles evidencing or representing purchase money indebtedness owing to the Borrower in connection with the sale of such Release Parcel, and any and all proceeds paid or payable thereunder; (b) any tangible Personal Property exclusively related to such Release Parcel; and (c) any other property expressly described in the recorded partial release. However, if requested by the Borrower entitled to the Partial Release of the Release Parcel, Lender shall from time to time execute amendments to UCC financing statements and other documents which have been prepared and delivered by the Borrower to Lender, are reasonably necessary to effectuate the release of such additional Property from the Security Documents, and are in form and substance satisfactory to Lender. 3.3 Determination of Partial Release Payments. As used in this Agreement, the term "Partial Release Payment" means an amount to be paid with respect to a Loan in consideration of the Partial Release of a Release Parcel and exclusively-related Personal Property from the Loan Security Documents for such Loan. Partial Release Payments for Parcels which are part of the Real Property which is the subject of a Loan shall be determined by Lender at the time of the first Advance which is made under the Loan for the purpose -14-

of paying (or reimbursing the Borrower under the Loan for) the costs of acquiring or improving the Real Property of which the Parcel is a part. In making its determination regarding the amount of Partial Release Payments for Parcels which are part of the Real Property which is the subject of a Loan, Lender may consider the projected revenues from the sales of such Parcels and the number of such Parcels; provided, however, that the minimum Partial Release Payment for any such Parcel which is a single-family residential lot shall be equal to the greater of (assuming all single-family residential lots are of approximately comparable value): (a) the quotient determined by dividing (i) the Maximum Loan Amount for such Loan by (ii) the product of (A) 0.80 times (B) the number of single-family residential lots into which such Real Property has been subdivided; or (b) the quotient determined by dividing (i) the Maximum Loan Amount for such Loan by (ii) the product of (A) 0.80 times (B) the projected gross revenues from the sales of single-family residential lots into which the Real

of paying (or reimbursing the Borrower under the Loan for) the costs of acquiring or improving the Real Property of which the Parcel is a part. In making its determination regarding the amount of Partial Release Payments for Parcels which are part of the Real Property which is the subject of a Loan, Lender may consider the projected revenues from the sales of such Parcels and the number of such Parcels; provided, however, that the minimum Partial Release Payment for any such Parcel which is a single-family residential lot shall be equal to the greater of (assuming all single-family residential lots are of approximately comparable value): (a) the quotient determined by dividing (i) the Maximum Loan Amount for such Loan by (ii) the product of (A) 0.80 times (B) the number of single-family residential lots into which such Real Property has been subdivided; or (b) the quotient determined by dividing (i) the Maximum Loan Amount for such Loan by (ii) the product of (A) 0.80 times (B) the projected gross revenues from the sales of single-family residential lots into which the Real Property has been subdivided. 3.4 Other Developmental Matters Affecting Security. If the Borrower under a Loan desires Lender to give its consent to or take any other action concerning a matter affecting the zoning, platting, development or sale of or title to any of the Real Property which is the subject of the Loan, it shall comply with the procedures set forth in EXHIBIT K. The provisions of the preceding sentence shall not apply to Borrower's desire to obtain Partial Releases or to obtain Advances, the procedures for which are set forth elsewhere in this Agreement. IV. CONDITIONS PRECEDENT TO THIS AGREEMENT AND TO ADVANCES. 4.1 Conditions Precedent to Loan Agreement. Lender's obligation to enter into this Agreement shall be subject to and conditioned upon Parent having delivered to Lender the Articles of Organization of Parent and following Documents, duly executed, delivered and in form and substance satisfactory to Lender: (a) the Resolutions of Parent; (b) a favorable opinion from independent counsel for Parent in form and substance satisfactory to Lender; (c) this Agreement; (d) the Third Party Consents required with respect to Parent's execution of the Documents and Performance of its Obligations; and (e) such other documents as Lender may reasonably require. 4.2 Conditions Precedent to First Advance of Loan. If a Bluegreen Entity wishes to obtain a Loan, Lender's obligation to make the first Advance of the Loan to a Bluegreen Entity shall be subject to and conditioned upon the terms and conditions set forth in the following subparagraphs and elsewhere in this Agreement being satisfied at the time of such Advance: -15-

(a) Documents. The Bluegreen Entity shall have delivered to Lender the following Loan Documents, duly executed, delivered, recorded/filed, if applicable, and otherwise in form and substance satisfactory to Lender: I. a Note in the amount of the Loan; II. a Mortgage encumbering the Real Property which is the subject of the Loan; III. a Security Agreement covering the Personal Property related to the Real Property which is the subject of the Loan; IV. the Assignments covering property related to the Real Property which is the subject of the Loan; V. UCC financing statements for filing and/or recording, as appropriate, where necessary to perfect the Security

(a) Documents. The Bluegreen Entity shall have delivered to Lender the following Loan Documents, duly executed, delivered, recorded/filed, if applicable, and otherwise in form and substance satisfactory to Lender: I. a Note in the amount of the Loan; II. a Mortgage encumbering the Real Property which is the subject of the Loan; III. a Security Agreement covering the Personal Property related to the Real Property which is the subject of the Loan; IV. the Assignments covering property related to the Real Property which is the subject of the Loan; V. UCC financing statements for filing and/or recording, as appropriate, where necessary to perfect the Security Interest in the Loan Collateral covered by the Loan Security Documents; VI. an Environmental Certificate pertaining to the Real Property which is the subject of the Loan; VII. if the Loan is a Development Loan, a Certificate and Agreement of Borrower Regarding ConstructionRelated Matters in form and substance identical to EXHIBIT I; VIII. if the Bluegreen Entity is a Subsidiary, a Certificate and Agreement of a Subsidiary Borrower (Basic) in form and substance identical to EXHIBIT J; IX. if Bluegreen Entity is a Subsidiary, a Guaranty; X. if the Bluegreen Entity is a Subsidiary, the subordination agreement, if any, required pursuant to paragraph 6.8 (b); XI. a Title Policy insuring the Mortgage required to be delivered to Lender in connection with the Loan (or an unconditional commitment for the delivery of the Title Policy promptly after delivery of the Loan); XII. a favorable opinion from independent counsel for the Bluegreen Entity and, if the Bluegreen Entity is a Subsidiary, from Parent with respect to the matters described in EXHIBIT E; and XIII. a Request for Advance in the applicable form. (b) Organizational Project and Other Due Diligence Documents. Unless waived in writing by Lender in its discretion, the Bluegreen Entity shall have delivered to Lender at least fifteen (15) Business Days prior to the date of the first Advance of the Loan in form and substance satisfactory to Lender: -16-

I. if the Bluegreen Entity is a Subsidiary, the Articles of Organization of such Borrower; II. if the Bluegreen Entity is a Subsidiary, the Resolutions of such Bluegreen Entity; III. current certificates of good standing for the Bluegreen Entity and, if the Bluegreen Entity is a Subsidiary, for Parent from their respective states of incorporation; and, in the case of the Bluegreen Entity, in the state where the Real Property which is the subject of the Loan is located; IV. a Level I environmental assessment of the Real Property which is the subject of the Loan and a "Haz Map Report" for such Real Property; V. evidence that taxes and assessments on the Real Property which is the subject of the Loan and related Personal Property have been paid; VI. evidence that the Bluegreen Entity has good and marketable title to an undivided fee simple interest in the

I. if the Bluegreen Entity is a Subsidiary, the Articles of Organization of such Borrower; II. if the Bluegreen Entity is a Subsidiary, the Resolutions of such Bluegreen Entity; III. current certificates of good standing for the Bluegreen Entity and, if the Bluegreen Entity is a Subsidiary, for Parent from their respective states of incorporation; and, in the case of the Bluegreen Entity, in the state where the Real Property which is the subject of the Loan is located; IV. a Level I environmental assessment of the Real Property which is the subject of the Loan and a "Haz Map Report" for such Real Property; V. evidence that taxes and assessments on the Real Property which is the subject of the Loan and related Personal Property have been paid; VI. evidence that the Bluegreen Entity has good and marketable title to an undivided fee simple interest in the Real Property which is the subject of the Loan, together with a title commitment or preliminary title report for the issuance of the required Title Policy, together with copies of all documents referred to therein; VII. a survey of the Real Property which is the subject of the Loan meeting 1992 ALTA/ACSM standards (or, at Lender's option exercisable in connection with each Loan, such lesser standards as Lender may expressly approve) certified to Lender and prepared by a licensed land surveyor acceptable to Lender, showing such Real Property, all easements necessary to the appropriate use of such Real Property and such other details as Lender may reasonably require; VIII. a written plan for the proposed use, development and sale of the Real Property which is the subject of the Loan (including, without limitation, sales projections and a detailed list of remaining development/construction items, with a breakdown of costs and completion schedules and bonds for completion and maintenance of improvements) and demonstrating that the gross profit margin of such Real Property (as developed in accordance with such plan) will be at least fifty percent (50%); and unless deferred or waived by Lender in writing, evidence that the Real Property has been platted or otherwise subdivided (or, at Lender's option exercisable in connection with each Loan, is capable of being promptly platted or otherwise subdivided without undue expense) in accordance with applicable Legal Requirements into not less than fifty (50) single-family residential lots in accordance with such plan, and all licenses and certificates (exclusive of licenses and certificates dependent upon completion of improvements to be constructed by the purchasers of Parcels) for the intended use of such Real Property, including environmental permits (or, at Lender's option exercisable in connection with each Loan, evidence that said licenses and certificates may be promptly obtained without undue expense; IX. unless deferred or waived by Lender in writing, evidence that the Real Property which is the subject of the Loan is zoned for the intended uses and that all approvals under applicable Legal Requirements have been obtained (or, at Lender's option, exercisable in connection with each Loan, is capable of being promptly zoned for the intended uses without undue expense); -17-

X. unless deferred or waived by Lender in writing, evidence that the Bluegreen Entity has complied with all applicable Legal Requirements and obtained all permits and approvals needed by it to sell the Parcels into which the Real Property which is the subject of the Loan has been or will be subdivided, including, without limitation, a copy of the registrations/consents to sell and the final subdivision public reports/public offering statements and/or prospectuses and approvals thereof required to be issued by or used in the state where the Real Property is located; XI. unless deferred or waived by Lender in writing, a copy of the form of the purchase contract, deed, promissory note, real property security document, credit applications and disclosures which will be used by the Bluegreen Entity in connection with the sale of Parcels into which the Real Property has been or will be subdivided, together with restrictive covenants, conditions, restrictions and easements governing or intended in the future to govern the Parcels, the management agreement (if any) for the project and advertising materials for the sale of the Parcels;

X. unless deferred or waived by Lender in writing, evidence that the Bluegreen Entity has complied with all applicable Legal Requirements and obtained all permits and approvals needed by it to sell the Parcels into which the Real Property which is the subject of the Loan has been or will be subdivided, including, without limitation, a copy of the registrations/consents to sell and the final subdivision public reports/public offering statements and/or prospectuses and approvals thereof required to be issued by or used in the state where the Real Property is located; XI. unless deferred or waived by Lender in writing, a copy of the form of the purchase contract, deed, promissory note, real property security document, credit applications and disclosures which will be used by the Bluegreen Entity in connection with the sale of Parcels into which the Real Property has been or will be subdivided, together with restrictive covenants, conditions, restrictions and easements governing or intended in the future to govern the Parcels, the management agreement (if any) for the project and advertising materials for the sale of the Parcels; XII. unless deferred or waived by Lender in writing, budgets for any owners' association in which the owners of Parcels are or will be members, if applicable, and information required by Lender regarding such other owners' association information; XIII. the Insurance Policies; XIV. evidence that the Real Property which is the subject of the Loan is not located within a flood prone area, except for such portion thereof which does not materially adversely affect the development, use or value of the Real Property (taken as a whole) which is the subject of the Advance; XV. evidence of the current and continued availability of adequate utilities to serve the Real Property which is the subject of the Loan for the intended use of such Real Property; XVI. evidence of access to the Real Property which is the subject of the Loan, which is adequate to serve such Real Property for its intended use; XVII. if the Loan includes an Acquisition/Refinancing Advance, a copy of the purchase contract pursuant to which the Bluegreen Entity desiring the Loan purchased or is to purchase the Real Property which is the subject of the Loan, closing settlement statements, paid invoices, canceled checks and other items reasonably satisfactory to Lender to verify the Acquisition/Refinancing Cost of such Real Property; XVIII. evidence that the Bluegreen Entity desiring the Loan continues to have invested in the Real Property which is the subject of the Loan cash in an amount determined as follows: (A) not less than twenty percent (20%) of the Acquisition/Refinancing Cost of such Real Property, if the Loan is an Acquisition/Refinancing Loan; or (B) not less than twenty percent (20%) of the sum of the Acquisition/Refinancing Cost of such Real Property plus, if the Loan is a Development Loan, the cost, as shown in the Construction Budget for the Loan, of Completion of the Work to be done in connection with the Improvements being financed in whole or in part under the Loan; -18-

XIX. a geological and soils test report or other evidence with respect to the suitability of the soils on the Real Property which is the subject of the Loan for the intended use; XX. if the Loan exceeds Two Million Dollars ($2,000,000) and otherwise if required by Lender in writing, an MAI appraisal of the Real Property which is the subject of the Loan reflecting a fair market value in an amount satisfactory to Lender; XXI. unless deferred or waived by Lender in writing, a hydrological study with respect to the Real Property which is the subject of the Loan; XXII. unless deferred or waived by Lender in writing, an archaeological study with respect to the Real Property which is the subject of the Loan;

XIX. a geological and soils test report or other evidence with respect to the suitability of the soils on the Real Property which is the subject of the Loan for the intended use; XX. if the Loan exceeds Two Million Dollars ($2,000,000) and otherwise if required by Lender in writing, an MAI appraisal of the Real Property which is the subject of the Loan reflecting a fair market value in an amount satisfactory to Lender; XXI. unless deferred or waived by Lender in writing, a hydrological study with respect to the Real Property which is the subject of the Loan; XXII. unless deferred or waived by Lender in writing, an archaeological study with respect to the Real Property which is the subject of the Loan; XXIII. market data with respect to the Real Property which is the subject of the Loan, including data or the price and absorption of lots or parcels of land in competing projects within such market; XXIV. if the Loan is a Development Loan, the items listed in EXHIBIT F; and XXV. such other items as Lender requests which are reasonably necessary to evaluate the request for the Advance and the satisfaction of the conditions precedent to the Advance. (c) Litigation and Judgment Searches. Lender shall have received the following in form and substance satisfactory to Lender: (I) the results of current UCC, lien, litigation, judgment and bankruptcy searches for the Bluegreen Entity desiring the Loan and, if such Bluegreen Entity is a Subsidiary, Parent conducted in such jurisdictions as Lender deems appropriate; and (II) the results of a site inspection of the Real Property which is the subject of the Loan made by Lender's employees. 4.3 Conditions Precedent to Subsequent Advances of Development Loan. For each Development Loan Advance other than an Interest Reserve Advance, Lender's obligation to make such Advance shall be subject to the terms and conditions set forth in EXHIBIT G, including delivery to Lender of the items called for therein at least ten (10) Business Days prior to the date of such Advance. 4.4 General Conditions Precedent to All Advances. Lender's obligation to fund an Advance is subject to and conditioned upon the additional terms and conditions set forth in the following subparagraphs remaining satisfied at the time of such Advance: -19-

(a) No Change in Collateral, Borrower or Parent. No material, adverse change shall have occurred in the Collateral or in the business or financial condition of Parent or any Subsidiary which is a Borrower since the date of the latest financial and operating statements given to Lender by or on behalf of Parent or any Subsidiary which is a Borrower. (b) No Change in Representations and Warranties. There shall have been no material, adverse change in the warranties and representations made in the Documents by Parent or any Subsidiary which is a Borrower. (c) No Event of Default or Incipient Default. Neither an Event of Default nor Incipient Default shall have occurred and be continuing. (d) Interest Rate Not Usurious. The interest rate applicable to the Advance (before giving effect to any savings clause) will not exceed the maximum rate permitted by the Applicable Usury Law. (e) Payment of Fees. Lender has received all fees required to be paid at the time of the Advance.

(a) No Change in Collateral, Borrower or Parent. No material, adverse change shall have occurred in the Collateral or in the business or financial condition of Parent or any Subsidiary which is a Borrower since the date of the latest financial and operating statements given to Lender by or on behalf of Parent or any Subsidiary which is a Borrower. (b) No Change in Representations and Warranties. There shall have been no material, adverse change in the warranties and representations made in the Documents by Parent or any Subsidiary which is a Borrower. (c) No Event of Default or Incipient Default. Neither an Event of Default nor Incipient Default shall have occurred and be continuing. (d) Interest Rate Not Usurious. The interest rate applicable to the Advance (before giving effect to any savings clause) will not exceed the maximum rate permitted by the Applicable Usury Law. (e) Payment of Fees. Lender has received all fees required to be paid at the time of the Advance. 4.5 Disbursement of Advances. Advances under a Loan may be disbursed to the Borrower under such Loan; or if requested by such Borrower and approved in writing by Lender or if required by Lender in connection with a Work-Related Advance under a Development Loan, to others, either severally or jointly with such Borrower, for the credit or benefit of such Borrower. Advances under a Loan shall be disbursed by wire transfer or, at the option of the Borrower under such Loan exercised by written request to Lender, by check or drafts. A Borrower of an Advance made by wire transfer will pay Lender's charge in connection with such wire transfer, which is currently Twenty-Five Dollars ($25). Lender may, at its option, withhold from an Advance under a Loan any sum (including costs and expenses) then due to it from the Borrower under the Loan pursuant to the terms of any of the Documents or for which such Borrower would be obligated to reimburse Lender pursuant to the terms of any of the Documents if the sum was first paid directly by Lender. Lender reserves the right to require that WorkRelated Advances under Development Loans be disbursed through a "control escrow." 4.6 No Waiver. Although Lender shall have no obligation to make an Advance unless and until all of the conditions precedent to the Advance have been satisfied, Lender may, at its sole discretion, make the Advance prior to that time without waiving or releasing any of the Obligations. 4.7 Interest Reserve Advances. If neither an Event of Default nor an Incipient Default exists and subject to the terms and conditions applicable to Interest Reserve Advances under a Development Loan, during the Borrowing Term of a Development Loan and, in Lender's discretion, after expiration of such Borrowing Term to the extent the Interest Reserve Fund under such Development Loan has not been exhausted, Lender will charge the Interest Reserve Fund, if any, under such Development Loan until it has been exhausted for monthly interest billings on such Development Loan. If the Interest Reserve Fund, if any, under a Development Loan is exhausted or is not otherwise available for such use, the Borrower under such Development Loan will pay to Lender the monthly installments of interest due in connection with such Development Loan in accordance with the terms of the related Note and this Agreement. -20-

V. NOTES, PAYMENTS; SALES AND PARTIAL RELEASES. 5.1 Repayment of Loans. Each Loan shall be evidenced by a separate Note and shall be repaid in immediately available funds with interest according to the terms of the form of the Note executed in connection with such Loan. Each Note executed in connection with a Loan on or after September 14, 1999, shall be in form and substance substantially identical to EXHIBIT B; provided, however, that in addition to the principal payments required pursuant to paragraph 5.2, Lender may require that the Borrower under such Loan make principal payments on each anniversary of the initial Advance of such Loan in amounts which are established in writing by Lender prior to such Advance and are specified in the Note evidencing such Loan. 5.2 Partial Release Principal Payments. Until a Note has been paid in full, the Borrower obligated thereunder will make to Lender at the time of each Partial Release of a Release Parcel from the Mortgage encumbering the Note a principal payment equal to the Partial Release Payment for such Release Parcel, and the Partial Release

V. NOTES, PAYMENTS; SALES AND PARTIAL RELEASES. 5.1 Repayment of Loans. Each Loan shall be evidenced by a separate Note and shall be repaid in immediately available funds with interest according to the terms of the form of the Note executed in connection with such Loan. Each Note executed in connection with a Loan on or after September 14, 1999, shall be in form and substance substantially identical to EXHIBIT B; provided, however, that in addition to the principal payments required pursuant to paragraph 5.2, Lender may require that the Borrower under such Loan make principal payments on each anniversary of the initial Advance of such Loan in amounts which are established in writing by Lender prior to such Advance and are specified in the Note evidencing such Loan. 5.2 Partial Release Principal Payments. Until a Note has been paid in full, the Borrower obligated thereunder will make to Lender at the time of each Partial Release of a Release Parcel from the Mortgage encumbering the Note a principal payment equal to the Partial Release Payment for such Release Parcel, and the Partial Release Payment shall be applied to such Note. 5.3 Prepayments. Each Loan and Note shall be entitled to be prepaid in whole or in part at any time. 5.4 Application of Proceeds. Notwithstanding anything in the Loan Documents for such Loan to the contrary other than the provisions of paragraph 3.2 or 5.2 hereof pertaining to the application of Partial Release Payments, the amount of all payments or amounts received by Lender with respect to a Loan shall be applied to the extent applicable under the Loan Documents for such Loan: (a) first, to any past due payments of interest on such Loan and to accrued interest on such Loan through the date of such payment, including any default interest; (b) then, to any interest on delinquent interest, late fees, overdue risk assessments, examination fees and expenses, collection fees and expenses and any other fees and expenses due to Lender under the Loan Documents for such Loan; and (c) last, the remaining balance, if any, to the unpaid principal balance of such Loan; provided, however, while an Event of Default or Incipient Default exists, each payment with respect to such Loan shall be applied to such amounts owed to Lender by the applicable Borrower in respect of when the payment was received as Lender in its discretion may determine. In calculating interest and applying payments as set forth above: (a) interest on a Loan shall be calculated and collected through the date payment is actually received by Lender; (b) interest on the outstanding balance of a Loan shall be charged during any grace period permitted under the Loan Documents for such Loan; (c) on each annual anniversary of the closing date of a Loan, all past due interest and other past due charges provided for under the Loan Documents for such Loan shall be added to the principal balance of such Loan; and (iv) to the extent that the Borrower under the Loan makes a payment or Lender receives any payment or proceeds of the Collateral for such Borrower's benefit that is subsequently invalidated, set aside or required to be repaid to any other person or entity, then, to such extent, the applicable Loan Obligations intended to be satisfied shall be revived and continue as if such payment or proceeds had not been received by Lender and Lender may adjust the balance of such Loan as Lender, in its discretion, deems appropriate under the circumstances. -21-

5.5 Borrower's Unconditional Obligation to Make Payments. Whether or not the proceeds from the Loan Collateral for a Loan shall be sufficient for that purpose, the Borrower under a Loan will pay when due all payments required to be made by it pursuant to any of the Loan Documents for the Loan, and such obligation to make such payments is absolute and unconditional. VI. BORROWER'S REPRESENTATIONS, WARRANTIES AND COVENANTS. 6.1 (a) Good Standing. Parent is and will remain, and will cause each Subsidiary which is a Borrower to be and remain, duly organized, validly existing and in good standing under the laws of their respective states of organization and qualified to do business and in good standing in each jurisdiction in which the location or nature of their respective properties or their respective businesses makes such qualification necessary. Parent has, and will cause each Subsidiary which is a Borrower to have, full authority to Perform their respective Obligations and to carry on their respective business and own their respective property. (b) Power and Authority; Enforceability. Parent has and will maintain, and will cause each Subsidiary which is a Borrower to have and maintain, full power and authority to grant the Security Interest, to execute and deliver the

5.5 Borrower's Unconditional Obligation to Make Payments. Whether or not the proceeds from the Loan Collateral for a Loan shall be sufficient for that purpose, the Borrower under a Loan will pay when due all payments required to be made by it pursuant to any of the Loan Documents for the Loan, and such obligation to make such payments is absolute and unconditional. VI. BORROWER'S REPRESENTATIONS, WARRANTIES AND COVENANTS. 6.1 (a) Good Standing. Parent is and will remain, and will cause each Subsidiary which is a Borrower to be and remain, duly organized, validly existing and in good standing under the laws of their respective states of organization and qualified to do business and in good standing in each jurisdiction in which the location or nature of their respective properties or their respective businesses makes such qualification necessary. Parent has, and will cause each Subsidiary which is a Borrower to have, full authority to Perform their respective Obligations and to carry on their respective business and own their respective property. (b) Power and Authority; Enforceability. Parent has and will maintain, and will cause each Subsidiary which is a Borrower to have and maintain, full power and authority to grant the Security Interest, to execute and deliver the Loan Documents required of it in connection with the Loans; and to Perform their respective Obligations. All action necessary and required by the Articles of Organization of Parent and all applicable laws for the obtaining of the Credit Facility and for the execution and delivery of the Loan Documents which have been or will be executed and delivered by it in connection with the Credit Facility has been duly and effectively taken. The Loan Documents which have been or will be executed by any Bluegreen Entity are and shall be legal, valid, binding and enforceable against it and do not and will not constitute a default or result in the imposition of a lien under the terms or provisions of any agreement to which it is a party. No consent of any governmental agency or any other person not a party to such Document is or will be required as a condition to the execution, delivery or enforceability of any Documents required of it hereunder by or against Parent or any Subsidiary which is a Borrower. 6.2 (a) No Litigation. There is no action, litigation or other proceeding pending or, to Parent's knowledge, threatened before any arbitration tribunal, court, governmental agency or administrative body against Parent, which might materially adversely affect the Collateral, the Performance of its Obligations, the business or financial condition of Parent, or the ability of Parent to Perform its Obligations. Parent will promptly notify Lender if any action, litigation or proceeding is pending or threatened against Parent or any Subsidiary which is a Borrower, which might materially, adversely affect the Collateral, the business or financial condition of Parent or any such Subsidiary, or the ability of Parent or any such Subsidiary to Perform its Obligations. 6.3 (a) Compliance with Laws. Parent has complied, and will comply and cause each Subsidiary which is a Borrower to comply, with all Legal Requirements where the failure to do so might materially, adversely affect the Collateral, the business or financial condition of Parent or any such Subsidiary, or the ability of Parent or any such Subsidiary to Perform its Obligations. -22-

6.4 (a) Restrictions on Transfers, Liens and Change of Control . Unless expressly permitted in this Agreement or in any of the Security Documents, without the prior written consent of Lender, Parent will not, and will not permit any Subsidiary which is a Borrower, to do any of the following: (a) except for sales and transfers of damaged, obsolete or worn-out items of tangible Personal Property or other non-material items of tangible Personal Property in accordance with the terms of the Security Documents, sell, convey, pledge, hypothecate, encumber or otherwise transfer any Collateral; (b) permit or suffer to exist any liens, security interests or other encumbrances on any Collateral, except for the Permitted Encumbrances and liens and security interests expressly granted to Lender; (c) permit or suffer the sale, lease, transfer or disposal of all or substantially all of their respective assets to another entity; or (d) only in the case of a Subsidiary, permit or suffer to exist any transfer of ownership interests in or control of such entity. 6.5 (a) Insurance. Parent will pay the cost of, will maintain, or cause to be maintained, and will deliver or cause to be delivered to Lender evidence of insurance policies required by Lender, and written by insurers and in amounts and on forms satisfactory to Lender.

6.4 (a) Restrictions on Transfers, Liens and Change of Control . Unless expressly permitted in this Agreement or in any of the Security Documents, without the prior written consent of Lender, Parent will not, and will not permit any Subsidiary which is a Borrower, to do any of the following: (a) except for sales and transfers of damaged, obsolete or worn-out items of tangible Personal Property or other non-material items of tangible Personal Property in accordance with the terms of the Security Documents, sell, convey, pledge, hypothecate, encumber or otherwise transfer any Collateral; (b) permit or suffer to exist any liens, security interests or other encumbrances on any Collateral, except for the Permitted Encumbrances and liens and security interests expressly granted to Lender; (c) permit or suffer the sale, lease, transfer or disposal of all or substantially all of their respective assets to another entity; or (d) only in the case of a Subsidiary, permit or suffer to exist any transfer of ownership interests in or control of such entity. 6.5 (a) Insurance. Parent will pay the cost of, will maintain, or cause to be maintained, and will deliver or cause to be delivered to Lender evidence of insurance policies required by Lender, and written by insurers and in amounts and on forms satisfactory to Lender. 6.6 (a) No Misrepresentations. The Documents and all certificates, financial statements and written materials furnished to Lender by or on behalf of Parent or any Subsidiary which is a Borrower in connection with the Credit Facility do not and will not contain any untrue statement of a material fact or omit to state a fact which materially adversely affects or in the future may materially adversely affect the Collateral, the business or financial condition of Parent or any Subsidiary which is a Borrower, or the ability of Parent or any such Subsidiary to perform its Obligations. (b) Reliance. Lender's examination, inspection or receipt of information pertaining to Parent, any Subsidiary which is a Borrower, or the Collateral shall not in any way be deemed to reduce the full scope and protection of the warranties, representations and Obligations contained in the Documents. 6.7 (a) Financial Information. Parent will furnish or cause to be furnished to Lender, within one hundred twenty (120) days after the end of each fiscal year of Parent, a copy of the current annual consolidated financial statements of Parent; and will furnish to Lender, within forty-five (45) days after the end of each interim quarterly fiscal period of Parent, a copy of the current consolidated financial statements of Parent for the period commencing with the first day of the fiscal year and concluding with such quarter end. Such financial statements shall contain a balance sheet as of the end of the relevant fiscal period and statements of income and of cash flow for such fiscal period (together, in each case, with the comparable figures for the corresponding period of the previous fiscal year), all in reasonable detail. All financial statements shall be prepared in accordance with generally accepted accounting principles, consistently applied. All financial statements required pursuant to this paragraph shall be certified by the chief financial officer of Parent. Annual statements shall be audited and certified by a recognized firm of certified public accountants reasonably satisfactory to Lender. Lender acknowledges that, as of the date hereof, the firm of Ernst & Young is acceptable to it. Together with such financial statements, Parent will deliver to Lender a certificate signed by Parent's chief financial officer stating that there exists no Event of Default or Incipient Default or, if any such Event of Default or Incipient Default exists, specifying the nature and period of its existence and what action Parent and any pertinent Subsidiary proposes to take with respect to it. -23-

(b) Right to Inspect. Parent will permit, and will cause each Subsidiary which is a Borrower to permit, Lender and its representatives at all reasonable times to inspect, audit and copy, as appropriate, the Collateral, and their respective records. (c) Additional Information. Parent will make available, and will cause each Subsidiary which is a Borrower to make available, to Lender such further information as Lender may from time to time reasonably request. 6.8 Subordination of Indebtedness. (a) All obligations of Parent to Lender are intended to, and do, constitute "Senior Indebtedness" as such term is defined in and for purposes of the Indenture dated as of May 15, 1987 ("Indenture") between Parent and Shawmut Bank, N.A., as trustee, pursuant to which the Borrower's eight and one-quarter percent (8 1/4%) Convertible Subordinated Debentures due 2012 ("Debentures") were issued, and will be entitled to all the

(b) Right to Inspect. Parent will permit, and will cause each Subsidiary which is a Borrower to permit, Lender and its representatives at all reasonable times to inspect, audit and copy, as appropriate, the Collateral, and their respective records. (c) Additional Information. Parent will make available, and will cause each Subsidiary which is a Borrower to make available, to Lender such further information as Lender may from time to time reasonably request. 6.8 Subordination of Indebtedness. (a) All obligations of Parent to Lender are intended to, and do, constitute "Senior Indebtedness" as such term is defined in and for purposes of the Indenture dated as of May 15, 1987 ("Indenture") between Parent and Shawmut Bank, N.A., as trustee, pursuant to which the Borrower's eight and one-quarter percent (8 1/4%) Convertible Subordinated Debentures due 2012 ("Debentures") were issued, and will be entitled to all the benefits associated with being "Senior Indebtedness" under the Indenture, including, without limitation, ranking senior to the Debentures. (b) Parent will cause each Borrower which is a Subsidiary to cause any and all indebtedness owing by such Subsidiary to its shareholders, directors or officers, Parent, or the Affiliates of such Borrower or the foregoing and all liens, security interests and other charges on the assets of such Borrower in respect of such indebtedness, including, without limitation, the Collateral, to be fully subordinated in all aspects to the Obligations of such Borrower pursuant to written agreements satisfactory to Lender; provided, however, that such subordination shall not extend to reasonable salaries and fees at normal and customary rates for services actually rendered or, if neither an Event of Default nor an Incipient Default is outstanding, to payments or distributions of any kind to Parent. Any such creditor shall execute a subordination agreement in form and substance satisfactory to Lender. 6.9 No Default for Third Party Obligations. Parent is not in default under any other agreement evidencing, guaranteeing or securing borrowed money or a receivables purchase financing involving an obligation in excess of the Threshold Amount to make a payment of principal or interest or to repurchase receivables or any other material default by Parent permitting the acceleration of the payment or repurchase obligations of Parent, which payment or repurchase obligations entitled to be accelerated are in excess of the Threshold Amount in the aggregate. Parent is not in violation of or in default under any material term in any other material agreement, instrument, order, decree or judgment of any court, arbitration or governmental authority to which it is a party or by which it is bound. 6.10 Net Worth Maintenance. Parent will at all times maintain an Adjusted Tangible Net Worth, determined in accordance with generally accepted accounting principles, in an amount not less than Eighty-Five Million Dollars ($85,000,000). As used herein, the term "Adjusted Tangible Net Worth" shall mean net worth less goodwill, determined in accordance with generally accepted accounting principles, consistently applied, plus the principal balance outstanding under the Indenture and other debt subordinated to the Obligations pursuant to agreements satisfactory to Lender (collectively, "Subordinated Debt"). -24-

6.11 Intentionally Left Blank. 6.12 Adjusted Leverage Ratio. Parent will not permit the ratio of its Adjusted Total Liabilities to Adjusted Tangible Net Worth at any time to be greater than 3.0 to 1.0. As used herein, the term "Total Liabilities" shall mean the aggregate of Parent's current liabilities and non-current liabilities; and the term "Adjusted Total Liabilities" shall mean Total Liabilities less Subordinated Debt. 6.13 Limitation on Marketing and G&A Expenses. Parent will not incur, and will not permit any consolidated subsidiary to incur, combined selling, general and administrative expenses that exceed sixty percent (60%) of net sales of the real estate owned by them and time-share interests created from such real estate, calculated as of the end of each calendar quarter on a twelve (12) month rolling basis. As used herein, the term "selling, general and administrative expenses" shall mean selling, general and administrative expenses properly allocable to real estate calculated in accordance with generally accepted accounting principles, consistently applied as previously reflected in the financial statements of Parent provided to Lender.

6.11 Intentionally Left Blank. 6.12 Adjusted Leverage Ratio. Parent will not permit the ratio of its Adjusted Total Liabilities to Adjusted Tangible Net Worth at any time to be greater than 3.0 to 1.0. As used herein, the term "Total Liabilities" shall mean the aggregate of Parent's current liabilities and non-current liabilities; and the term "Adjusted Total Liabilities" shall mean Total Liabilities less Subordinated Debt. 6.13 Limitation on Marketing and G&A Expenses. Parent will not incur, and will not permit any consolidated subsidiary to incur, combined selling, general and administrative expenses that exceed sixty percent (60%) of net sales of the real estate owned by them and time-share interests created from such real estate, calculated as of the end of each calendar quarter on a twelve (12) month rolling basis. As used herein, the term "selling, general and administrative expenses" shall mean selling, general and administrative expenses properly allocable to real estate calculated in accordance with generally accepted accounting principles, consistently applied as previously reflected in the financial statements of Parent provided to Lender. 6.14 Payment of Taxes. Parent has filed or will file and cause each Subsidiary which is a Borrower to file all tax returns required to be filed by such entity, and Parent has paid or will pay and will cause each Subsidiary which is a Borrower to pay all taxes, assessments, levies and penalties, if any, required to be paid by such entity, to any governmental or quasi-governmental authority or subdivision, including real estate taxes and assessments relating to the Collateral, unless and only to the extent the item shall be contested in good faith and by appropriate proceedings by such entity, such entity shall set aside and cause on its books adequate reserves with respect to the contested item and, in connection with any tax assessment, levy or penalty levied against the Collateral, the entity granting the Security Interest in such Collateral shall comply with the terms of Security Documents pertaining to such contest. 6.15 Credit Facility Fees and Expenses. Lender acknowledges that all fees required to be paid to Lender in connection with the Credit Facility prior to the date of its execution hereof have been paid. In addition to such fees paid prior to the date hereof, Parent will pay to Lender on April 1, 2000, a fee equal to one percent (1%) of the excess of (a) Twenty Million Dollars ($20,000,000) over (b) the aggregate principal amount of Advances made during the twelve (12) month period ending on March 31, 2000. Borrower will also pay to Lender on April 1, 2001 and April 1, 2002, a fee equal to one and one-half percent (1-1/2%) of the excess of (a) Twenty Million Dollars ($20,000,000) over (b) the average daily outstanding principal balance of the Credit Facility for the twelve (12) month period ending on the preceding day (i.e. March 31). For purposes hereof, the daily principal balance of a Loan shall be determined in the same manner as Lender determines the daily principal balance for purposes of computing interest accrued on the Loan. Parent will also pay on demand any and all reasonable costs and expenses incurred by Lender in connection with the initiation, documentation, closing and modification of the Credit Facility and the Loans, the making of Advances, the administration of the Loans, the full or partial release of the Collateral, the protection of the Collateral, and the enforcement of the Obligations, including, without limitation: all reasonable attorneys' and other professionals' fees and -25-

charges (including, without limitation, normal charges for photocopy, telecopy and computer services); the costs of credit reports and UCC, lien, litigation, judgment and bankruptcy searches, and revenue, documentary stamp and intangible taxes; and Parent will cause each Subsidiary which is a Borrower to pay such of those costs and expenses incurred in connection with any and all Loans made to such Subsidiary. Without limiting the generality of the foregoing, if a bankruptcy proceeding is commenced by or against a Borrower or otherwise involving any Collateral for the Obligations of a Borrower, Lender shall, to the extent not already provided for herein, be entitled to recover, and such Borrower and, if it is not the Borrower, Parent shall be obligated to pay, Lender's reasonable attorneys' fees incurred in connection with: (i) any determination of the applicability of the bankruptcy laws to the terms of this Agreement and the other Documents executed by the Borrower or, if it is not the Borrower, by Parent or to Lender's rights thereunder; (ii) any attempt by Lender to enforce or preserve its rights under the bankruptcy laws or to prevent Borrower or any other person from seeking to deny Lender its rights thereunder; (iii) any effort by Lender to protect, preserve or enforce its rights against any Collateral for the Obligations of such Borrower or seeking authority to modify the automatic stay of 11 U.S.C. Section 362 or otherwise seeking to engage in such protection, preservation or enforcement; or (iv) any proceeding(s) arising under the bankruptcy laws or arising in or related to a case under bankruptcy laws.

charges (including, without limitation, normal charges for photocopy, telecopy and computer services); the costs of credit reports and UCC, lien, litigation, judgment and bankruptcy searches, and revenue, documentary stamp and intangible taxes; and Parent will cause each Subsidiary which is a Borrower to pay such of those costs and expenses incurred in connection with any and all Loans made to such Subsidiary. Without limiting the generality of the foregoing, if a bankruptcy proceeding is commenced by or against a Borrower or otherwise involving any Collateral for the Obligations of a Borrower, Lender shall, to the extent not already provided for herein, be entitled to recover, and such Borrower and, if it is not the Borrower, Parent shall be obligated to pay, Lender's reasonable attorneys' fees incurred in connection with: (i) any determination of the applicability of the bankruptcy laws to the terms of this Agreement and the other Documents executed by the Borrower or, if it is not the Borrower, by Parent or to Lender's rights thereunder; (ii) any attempt by Lender to enforce or preserve its rights under the bankruptcy laws or to prevent Borrower or any other person from seeking to deny Lender its rights thereunder; (iii) any effort by Lender to protect, preserve or enforce its rights against any Collateral for the Obligations of such Borrower or seeking authority to modify the automatic stay of 11 U.S.C. Section 362 or otherwise seeking to engage in such protection, preservation or enforcement; or (iv) any proceeding(s) arising under the bankruptcy laws or arising in or related to a case under bankruptcy laws. 6.16 Indemnification. Parent will INDEMNIFY, PROTECT, HOLD HARMLESS, and defend Lender, its successors, assigns and shareholders (including corporate shareholders), and the directors, officers, employees, agents and servants of the foregoing, for, from and against, except to the extent arising from the indemnitee's gross negligence or willful misconduct, any and all losses, costs, expenses (including, without limitation, court costs and attorneys' fees), demands, claims, suits, proceedings (whether civil or criminal), orders, judgments, penalties, fines and other sanctions arising from or brought in connection with (a) any of the Collateral, the terms of the Documents or the transactions related thereto, or any act or omission of Parent or any Subsidiary which is a Borrower or their respective employees or agents, whether actual or alleged, and (b) any and all brokers' commissions or finders' fees or other costs of similar type by any party engaged by Parent or any Subsidiary which is a Borrower in connection with the Credit Facility. On written request by a person or other entity covered by the above agreement of indemnity, Parent will undertake, at its own cost and expense, on behalf of such indemnitee, using counsel satisfactory to the indemnitee, the defense of any legal action or proceeding to which such person or entity shall be a party and for which such indemnitee is entitled to be indemnified pursuant to this paragraph 6.16. At Lender's option, Lender may prosecute or defend any action involving the priority, validity or enforceability of the Security Interests at the expense of Parent and the Borrower granting the Security Interests. 6.17 Perfection of Security Interests. Parent will execute or cause to be executed all documents, and do or cause to be done all acts, reasonably necessary for Lender to perfect and to continue the perfection of Security Interests or otherwise to effect the intent and purposes of the Documents. -26-

6.18 Survival and Additional Representations, Warranties and Covenants. The representations, warranties and covenants contained in this Article VI are in addition to, and not in derogation of, the representations and warranties contained elsewhere in the Documents and shall be deemed to be made and reaffirmed prior to the making of each Advance. VII. DEFAULT. 7.1 Events of Default. The occurrence of any of the following events or conditions shall constitute an Event of Default under the Documents: (a) failure of Lender to receive within five (5) Business Days of the date when due and payable (i) any amount payable under a Note or (ii) any other payment due from Parent or any Subsidiary which is a Borrower, except for the payment due at the Maturity Date of a Note for which no grace period is allowed; (b) any representation or warranty which is made by a person other than Lender and is contained in the Documents or in any certificate furnished to Lender under the Documents by or on behalf of Parent or any Subsidiary which is a Borrower proves to be, in any material, adverse respect, false or misleading as of the date deemed made;

6.18 Survival and Additional Representations, Warranties and Covenants. The representations, warranties and covenants contained in this Article VI are in addition to, and not in derogation of, the representations and warranties contained elsewhere in the Documents and shall be deemed to be made and reaffirmed prior to the making of each Advance. VII. DEFAULT. 7.1 Events of Default. The occurrence of any of the following events or conditions shall constitute an Event of Default under the Documents: (a) failure of Lender to receive within five (5) Business Days of the date when due and payable (i) any amount payable under a Note or (ii) any other payment due from Parent or any Subsidiary which is a Borrower, except for the payment due at the Maturity Date of a Note for which no grace period is allowed; (b) any representation or warranty which is made by a person other than Lender and is contained in the Documents or in any certificate furnished to Lender under the Documents by or on behalf of Parent or any Subsidiary which is a Borrower proves to be, in any material, adverse respect, false or misleading as of the date deemed made; (c) a default in the Performance of the Obligations set forth in paragraph 6.4(a), 6.4(c), 6.4(d), 6.5, 6.8, 6.10, 6.12 or 6.13; (d) a default by Parent or any Subsidiary which is a Borrower in the Performance of its Obligations or a violation of any term, covenant or provision of the Documents (other than a default or violation referred to elsewhere in this paragraph 7.1) which continues unremedied (i) for a period of five (5) Business Days after notice of such default or violation given by Lender to such Borrower in the case of a default under or violation of paragraph 6.4 (b) or any other default or violation which can be cured by the payment of money alone or (ii) for a period of thirty (30) days after notice to such Borrower in the case of any other default or violation; (e) an "Event of Default", as defined elsewhere in any of the Documents; (f) any default by Parent or any Subsidiary which is a Borrower under any other agreement evidencing, guaranteeing or securing borrowed money or a receivables purchase financing involving an obligation in excess of the applicable Threshold Amount to make a payment of principal or interest or to repurchase receivables or any other material default by such entity under any such agreement permitting the acceleration of their payment or repurchase obligations, which accelerated repayment or repurchase obligations are in the aggregate in excess of the Threshold Amount applicable to such entity; (g) any final, non-appealable judgment, decree or award for money damages or for a fine or penalty against Parent or any Subsidiary which is a Borrower which is not paid and discharged or stayed within thirty (30) days thereafter and when aggregated with all other judgment(s) or decree(s) against such entity that have remained unpaid and undischarged or stayed for such period is in excess of the applicable Threshold Amount; -27-

(h) subject to any provisions of the Security Documents permitting the contest of such liens or security interests, any party holding a lien or security interest in any of the Collateral commences foreclosure or similar sale thereof; (i) Parent or any Subsidiary which is a Borrower shall (i) generally not be paying its debts as they become due, (ii) file, or consent by answer or otherwise to the filing against it of, a petition for relief or reorganization, arrangement or liquidation or any other petition in bankruptcy or insolvency under the laws of any jurisdiction, (iii) make an assignment for the benefit of its creditors, (iv) consent to the appointment of a custodian, receiver, trustee or other officer with similar powers for itself, any of the Collateral or any substantial part of its property, (v) be adjudicated insolvent, (vi) dissolve or commence to wind-up its affairs or (vii) take any action for purposes of the foregoing; or a petition for relief or reorganization, arrangement or liquidation or any other petition in bankruptcy or insolvency or the appointment of a custodian under the laws of any jurisdiction is filed against Parent or any Subsidiary which is a Borrower or a custodian is appointed for any of the Collateral or any

(h) subject to any provisions of the Security Documents permitting the contest of such liens or security interests, any party holding a lien or security interest in any of the Collateral commences foreclosure or similar sale thereof; (i) Parent or any Subsidiary which is a Borrower shall (i) generally not be paying its debts as they become due, (ii) file, or consent by answer or otherwise to the filing against it of, a petition for relief or reorganization, arrangement or liquidation or any other petition in bankruptcy or insolvency under the laws of any jurisdiction, (iii) make an assignment for the benefit of its creditors, (iv) consent to the appointment of a custodian, receiver, trustee or other officer with similar powers for itself, any of the Collateral or any substantial part of its property, (v) be adjudicated insolvent, (vi) dissolve or commence to wind-up its affairs or (vii) take any action for purposes of the foregoing; or a petition for relief or reorganization, arrangement or liquidation or any other petition in bankruptcy or insolvency or the appointment of a custodian under the laws of any jurisdiction is filed against Parent or any Subsidiary which is a Borrower or a custodian is appointed for any of the Collateral or any substantial part of the property of Parent or any Subsidiary which is a Borrower, and such proceeding is not dismissed and appointment vacated within ninety (90) days thereafter; (j) a material, adverse change in the Collateral or the business or financial condition of Parent or any Subsidiary which is a Borrower, which change is not enumerated in this paragraph 7.1 as the result of which Lender in good faith deems the prospect of Performance of the Obligations of such entity materially impaired or the Collateral materially imperiled; (k) failure of Lender to receive, within twenty (20) days of the date Parent or any Subsidiary which is a Borrower knows or should have known of such change, notice of any material, adverse change in any representations or warranties in the Documents or otherwise made in connection with the Credit Facility; or (l) at any time prior to Completion of the Work related to a Development Loan under which it is a Borrower, Parent or any Subsidiary (i) abandons the Work or (ii) delays construction or suffers construction to be delayed for any period of time, for any reason whatsoever not covered by item (i) of this paragraph 7.1(l) so that Completion of the Work cannot be accomplished in the ordinary course of construction, in the reasonable judgment of Lender, on or before the Required Completion Date. 7.2 Remedies. At any time after an Event of Default has occurred and while it is continuing, Lender may but without obligation, in addition to the rights and powers granted elsewhere in the Documents and not in limitation thereof, do any one or more of the following: (a) cease to make further Advances; (b) declare the Notes, or any of them, together with any applicable prepayment premium and all other sums owing to Lender by Parent and/or any Subsidiaries which are Borrowers in connection with the Documents, immediately due and payable without notice (including, without limitation, notice of acceleration or intention to accelerate), presentment, demand or protest; -28-

(c) apply the then balance of the Required Completion Assurance Deposits given to Lender by or on behalf of any Borrower to the satisfaction of the Obligations of such Borrower in such order and manner as Lender may determine; (d) with respect to any Work financed under a Development Loan, to the extent Completion of such Work has not occurred: (i) continue and/or cause Completion of the Work; (ii) take exclusive possession of the Property or any part thereof which is security for such Development Loan; (iii) expend such funds as Lender may deem appropriate, including the Required Completion Assurance Deposit(s) (if any) given to Lender by the Borrower under the Development Loan, any other funds held by Lender as security therefor and any sums which may remain unadvanced hereunder, to continue and/or cause Completion of such Work; (iv) demand and receive performances due under the related Principal Work-Related Items and the other related Contracts, Licenses, Permits and Other Intangibles; (v) make such changes to the scope of such Work and to the related Principal Work-Related Items and other related Contracts, Licenses, Permits and Other Intangibles as may be necessary or desirable in Lender's judgment; (vi) file claims, institute enforcement actions and otherwise prosecute and defend all actions or proceedings relating to such Work, the related Principal Work-Related Items and the other related Contracts, Licenses, Permits and other Intangibles as Lender may determine to be necessary or desirable; (vii) pay, settle or compromise all existing bills and claims which are or may be liens against any of the Property which is security for such Development Loan or as Lender may deem to be necessary or desirable in Lender's judgment for the continuance or Completion of such Work or the clearance of title, all without notice to Borrower; (viii) execute in the name of the Borrower under such Development Loan all applications, certificates, notices and other instruments and give all instructions and communications which may be required or permitted by the related Principal Work-Related Items and other related Contracts, Licenses, Permits and Other Intangibles as determined by Lender; (ix) cancel or surrender any of the related Principal Work-Related Items and the other related Contracts, Licenses, Permits and Other Intangibles and enter into new contracts for the Completion of such Work and any changes to the scope of such Work; (x) do any and every act with respect to the Completion of such Work, the related Principal Work-Related Items and the other related Contracts, Licenses, Permits and Other Intangibles which the Borrower under such Development Loan may do in its behalf; (xi) employ such contractors, subcontractors, suppliers, agents, attorneys, architects, accountants, appraisers, security guards and inspectors as Lender may in its judgment deem necessary or desirable to accomplish any of the above purposes; and (xii) receive, collect, open and read all mail of the Borrower under such Development Loan for the purpose of obtaining all items pertaining to such Work, the related Principal Work-Related Items and the other related Contracts, Licenses, Permits and Other Intangibles; and (e) proceed to protect and enforce its rights and remedies under the Documents and to foreclose or otherwise realize upon the Collateral, or to exercise any other rights and remedies available to it at law, in equity or by statute. -29-

7.3 Application of Proceeds During an Event of Default. Notwithstanding anything in the Documents to the contrary, while an Event of Default exists, any cash (including Required Completion Assurance Deposits) received and retained by Lender as part of the Collateral given by a Borrower may be applied to payment of the Obligations of such Borrower (and in the case of Parent, the Obligations of its Subsidiaries) in such order and manner as Lender may determine. 7.4 Lender's Right to Perform. Lender may, at its option, and without any obligation to do so, pay, perform and discharge any and all Obligations (including, without limitation, the Obligations to maintain insurance) agreed to be paid or performed in the Documents by Parent, any Subsidiary which is a Borrower, or any other person liable for the Performance of the Obligations if such person has failed to do so and either (a) an Event of Default exists or (b) Lender in good faith deems such action necessary to protect any of the Collateral or its value. For such purposes Lender may use the proceeds of the Collateral. All amounts expended by Lender in so doing or in exercising its remedies under the Documents following an Event of Default shall become part of the Obligations, shall be immediately due and payable to Lender upon demand by Parent and (if any) the Subsidiary failing to perform, and shall bear interest at the Default Rate from the dates of such expenditures until paid. 7.5 Non-Exclusive Remedies. No remedy in any Document conferred on or reserved to Lender is intended to be

7.3 Application of Proceeds During an Event of Default. Notwithstanding anything in the Documents to the contrary, while an Event of Default exists, any cash (including Required Completion Assurance Deposits) received and retained by Lender as part of the Collateral given by a Borrower may be applied to payment of the Obligations of such Borrower (and in the case of Parent, the Obligations of its Subsidiaries) in such order and manner as Lender may determine. 7.4 Lender's Right to Perform. Lender may, at its option, and without any obligation to do so, pay, perform and discharge any and all Obligations (including, without limitation, the Obligations to maintain insurance) agreed to be paid or performed in the Documents by Parent, any Subsidiary which is a Borrower, or any other person liable for the Performance of the Obligations if such person has failed to do so and either (a) an Event of Default exists or (b) Lender in good faith deems such action necessary to protect any of the Collateral or its value. For such purposes Lender may use the proceeds of the Collateral. All amounts expended by Lender in so doing or in exercising its remedies under the Documents following an Event of Default shall become part of the Obligations, shall be immediately due and payable to Lender upon demand by Parent and (if any) the Subsidiary failing to perform, and shall bear interest at the Default Rate from the dates of such expenditures until paid. 7.5 Non-Exclusive Remedies. No remedy in any Document conferred on or reserved to Lender is intended to be exclusive of any other remedy or remedies, but each and every such remedy shall be cumulative and shall be in addition to every other remedy given under any Document or now or hereafter existing at law or in equity. No delay or omission to exercise any right or power shall be construed to be a waiver of or acquiescence to any default or a waiver of any right or power; and every such right and power may be exercised from time to time and as often as may be deemed expedient. Without limiting the generality of the foregoing, Lender shall be entitled to seek specific performance of the Obligations of Parent and each Borrower under the Documents without the necessity to prove that irrepairable harm will occur without the granting of such remedy or that an adequate remedy does not exist at law. VIII. CONSTRUCTION AND GENERAL TERMS. 8.1 Payment Location. All monies payable under the Documents shall be paid to Lender at its address set forth in paragraph 8.5 in lawful monies of the United States of America, unless otherwise designated in the Documents or by Lender by notice. 8.2 Entire Agreement. The Documents executed from time to time shall exclusively and completely state the rights and obligations of Lender, Parent and Subsidiaries with respect to the Credit Facility. No modification, variation, termination, discharge, abandonment, or waiver of any of the terms or conditions of the Documents shall be valid unless in writing and signed by duly authorized representatives of the party sought to be bound by such action. The Documents supersede any and all prior representations, warranties and/or inducements, written or oral, heretofore made by Lender concerning this transaction, including any commitment for financing. -30-

8.3 Powers Coupled With an Interest. The powers and agency granted to Lender by Parent or any Subsidiary which is a Borrower are coupled with an interest and are irrevocable until the Obligations of such entity have been performed and are granted as cumulative to Lender's other remedies for collection and enforcement of the Obligations. 8.4 Counterparts. Any Document may be executed simultaneously in any number of identical copies, each of which shall constitute an original for all purposes. 8.5 Notices. All notices, requests or demands required or permitted to be given under the Documents shall be in writing, and shall be deemed effective (a) upon hand delivery, if hand delivered; (b) one (1) Business Day after such are deposited for delivery via Federal Express or other nationally recognized overnight courier service; or (c) three (3) Business Days after such are deposited in the United States mails, certified or registered mail, all with delivery charges and/or postage prepaid, and addressed as shown below, or to such other address as either party may, from time to time, designate in writing. Written notice may be given by telecopy to the telecopier number shown below or to such other telecopier number as either party may designate, from time to time, in writing, provided that such notice shall not be deemed effective unless it is confirmed within twenty-four (24)

8.3 Powers Coupled With an Interest. The powers and agency granted to Lender by Parent or any Subsidiary which is a Borrower are coupled with an interest and are irrevocable until the Obligations of such entity have been performed and are granted as cumulative to Lender's other remedies for collection and enforcement of the Obligations. 8.4 Counterparts. Any Document may be executed simultaneously in any number of identical copies, each of which shall constitute an original for all purposes. 8.5 Notices. All notices, requests or demands required or permitted to be given under the Documents shall be in writing, and shall be deemed effective (a) upon hand delivery, if hand delivered; (b) one (1) Business Day after such are deposited for delivery via Federal Express or other nationally recognized overnight courier service; or (c) three (3) Business Days after such are deposited in the United States mails, certified or registered mail, all with delivery charges and/or postage prepaid, and addressed as shown below, or to such other address as either party may, from time to time, designate in writing. Written notice may be given by telecopy to the telecopier number shown below or to such other telecopier number as either party may designate, from time to time, in writing, provided that such notice shall not be deemed effective unless it is confirmed within twenty-four (24) hours by hand delivery, courier delivery or mailing of a copy of such notice in accordance with the requirements set forth above.
If to Lender: FINOVA CAPITAL CORPORATION 7272 East Indian School Road, Suite 410 Scottsdale, Arizona 85251 Attn: Vice President-Resort Finance Telecopy: (480) 874-6444 with a copy to: FINOVA CAPITAL CORPORATION 7272 East Indian School Road, Suite 410 Scottsdale, Arizona 85251 Attn: Vice President-Associate General Counsel Telecopy: (480) 874-6445 If to Parent or any Borrower: BLUEGREEN CORPORATION 460 Blue Lake Drive Boca Raton, Florida 33431 Attention: Patrick Rondeau, Esq. Telecopy: (561) 912-8299 (provided that notice to any Borrower which is a Subsidiary shall be addressed to it c/o Parent)

8.6 Successors and Assigns. All the covenants of Parent and the Subsidiaries which are Borrowers and all the rights and remedies of the Lender contained in the Documents shall bind Parent and such Subsidiaries, and, subject to the restrictions on merger, consolidation and assignment contained in the Documents, their respective successors and assigns, and shall inure to the benefit of Lender, its successors and assigns, whether so expressed or not. Neither Parent nor any Borrower may assign its rights in the Documents in whole or in part. Except as may be expressly provided in a Document, no person or other entity shall be deemed a third party beneficiary of any provision of the Documents. Furthermore, no Subsidiary shall be deemed be a third party beneficiary of Lender's obligations under this Agreement to make Loans; but after the initial Advance of a Loan to a Subsidiary, such Subsidiary, and not Parent, shall be deemed the real party in interest with respect to the enforcement against Lender of the terms and conditions of this Agreement and the other Loan Documents, excluding any Guaranty, for the Loan. -31-

8.7 Severability. If any one or more of the provisions contained in any Document shall be held invalid, illegal or unenforceable in any respect, the validity, legality and enforceability of the remaining provisions contained in the Document shall not in any way be affected or impaired thereby. In lieu of each such enforceable provision, there shall be added automatically as a part of such Document a provision that is legal, valid, binding and enforceable and is as similar in terms to such unenforceable provision as may be possible.

8.7 Severability. If any one or more of the provisions contained in any Document shall be held invalid, illegal or unenforceable in any respect, the validity, legality and enforceability of the remaining provisions contained in the Document shall not in any way be affected or impaired thereby. In lieu of each such enforceable provision, there shall be added automatically as a part of such Document a provision that is legal, valid, binding and enforceable and is as similar in terms to such unenforceable provision as may be possible. 8.8 Time of the Essence. Time is of the essence in the Performance of the Obligations. 8.9 Miscellaneous. All headings are inserted for convenience only and shall not affect any construction or interpretation of the Documents. Unless otherwise indicated, all references in a Document to clauses and other subdivisions refer to the corresponding paragraphs, clauses and other subdivisions of the Document; the words "herein," "hereof," "hereto," hereunder" and words of similar import refer to the Document as a whole and not to any particular paragraph, clause or other subdivision; and reference to a numbered or lettered subdivision of an Article, or paragraph shall include relevant matter within the Article or paragraph which is applicable to but not within such numbered or lettered subdivision. All Schedules and Exhibits referred to in this Agreement are incorporated in this Agreement by reference. 8.10 CHOICE OF LAW. EXCEPT AS OTHERWISE EXPRESSLY PROVIDED THEREIN, THE DOCUMENTS AND THE RIGHTS, DUTIES AND OBLIGATIONS OF THE PARTIES THERETO SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE OF ARIZONA (WITHOUT REGARD TO PRINCIPLES OF CONFLICTS OF LAWS) AND TO THE EXTENT THEY PREEMPT THE LAWS OF SUCH STATE, THE LAWS OF THE UNITED STATES, PROVIDED, HOWEVER, THAT THE INTERNAL LAWS OF THE STATE WHERE REAL PROPERTY IS LOCATED (WITHOUT REGARD TO PRINCIPLES OF CONFLICTS OF LAWS) SHALL GOVERN THE PROCEDURES CONTROLLING THE CREATION, PERFECTION AND FORECLOSURE OF THE LIEN, SECURITY INTERESTS, ASSIGNMENT AND OTHER CHARGES INTENDED TO BE CREATED THE SECURITY DOCUMENT ENCUMBERING SUCH REAL PROPERTY. (b) CHOICE OF JURISDICTION AND VENUE. EACH OF PARENT AND LENDER: (A) HEREBY IRREVOCABLY SUBMITS ITSELF TO THE PROCESS, JURISDICTION AND VENUE OF THE COURTS OF THE STATE OF ARIZONA, MARICOPA COUNTY, AND TO THE PROCESS, JURISDICTION, AND VENUE OF THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF ARIZONA, FOR THE PURPOSES OF SUIT, ACTION OR OTHER PROCEEDINGS ARISING OUT OF OR RELATING TO THE DOCUMENTS OR THE SUBJECT MATTER THEREOF (EXCEPT AS MAY BE SPECIFICALLY PROVIDED TO THE CONTRARY IN THE SECURITY DOCUMENTS), AND, IF LENDER INITIATES SUCH ACTION, ANY COURT IN WHICH LENDER SHALL INITIATE SUCH ACTION, AND THE CHOICE OF SUCH VENUE SHALL IN ALL INSTANCES BE AT THE LENDER'S ELECTION; AND (B) WITHOUT LIMITING THE GENERALITY OF THE FOREGOING, HEREBY WAIVES AND AGREES NOT TO ASSERT BY WAY OF MOTION, DEFENSE OR OTHERWISE IN ANY SUCH SUIT, ACTION OR PROCEEDING ANY CLAIM THAT IT IS NOT PERSONALLY SUBJECT TO THE JURISDICTION OF THE ABOVE-NAMED COURTS, THAT SUCH SUIT, ACTION OR PROCEEDING IS BROUGHT IN AN INCONVENIENT FORUM OR THAT THE VENUE OF SUCH SUIT, ACTION OR PROCEEDING IS IMPROPER. EACH OF PARENT AND LENDER HEREBY WAIVES THE RIGHT TO COLLATERALLY ATTACK ANY JUDGMENT OR ACTION IN ANY OTHER FORUM. -32-

(c) WAIVER OF JURY TRIAL. LENDER AND PARENT ACKNOWLEDGE AND AGREE THAT ANY CONTROVERSY WHICH MAY ARISE UNDER ANY OF THE DOCUMENTS WOULD BE BASED UPON DIFFICULT AND COMPLEX ISSUES; AND, THEREFORE, THEY AGREE THAT ANY LAWSUIT ARISING OUT OF ANY SUCH CONTROVERSY SHALL BE TRIED BY A JUDGE SITTING WITHOUT A JURY, AND KNOWINGLY AND VOLUNTARILY WAIVE TRIAL BY JURY IN ANY SUCH PROCEEDING. (d) BORROWER CONSENTS AND WAIVERS. PARENT WILL CAUSE EACH SUBSIDIARY WHICH

(c) WAIVER OF JURY TRIAL. LENDER AND PARENT ACKNOWLEDGE AND AGREE THAT ANY CONTROVERSY WHICH MAY ARISE UNDER ANY OF THE DOCUMENTS WOULD BE BASED UPON DIFFICULT AND COMPLEX ISSUES; AND, THEREFORE, THEY AGREE THAT ANY LAWSUIT ARISING OUT OF ANY SUCH CONTROVERSY SHALL BE TRIED BY A JUDGE SITTING WITHOUT A JURY, AND KNOWINGLY AND VOLUNTARILY WAIVE TRIAL BY JURY IN ANY SUCH PROCEEDING. (d) BORROWER CONSENTS AND WAIVERS. PARENT WILL CAUSE EACH SUBSIDIARY WHICH IS A BORROWER TO GRANT CONSENTS AND WAIVERS WHICH ARE APPLICABLE TO IT SUBSTANTIALLY IDENTICAL TO THOSE SET FORTH IN THIS PARAGRAPH 8.10. (e) INDUCEMENT TO LENDER. ALL OF THE PROVISIONS SET FORTH IN THIS PARAGRAPH ARE MATERIAL INDUCEMENTS FOR LENDER'S EXTENDING THE CREDIT FACILITY TO PARENT AND MAKING ADVANCES TO BORROWERS. Parent's initials ______ ] Lender's initials ______ ] 8.11 Compliance Applicable Usury Law. It is the intent of the parties hereto to comply with the Applicable Usury Law. Accordingly, notwithstanding any provisions to the contrary in the Documents, in no event shall this Agreement or the Documents require the payment or permit the collection of interest in excess of the maximum contract rate permitted by the Applicable Usury Law. 8.12 Attorneys' Fees. Without limitation of the generality of any other provision in the Documents, if Lender, Parent or any Subsidiary which is a Borrower shall commence litigation to enforce the Documents or otherwise related to the Credit Facility, the prevailing party shall be entitled to its reasonable attorneys' fees and costs, to be determined by a court and not by a jury. -33-

8.13 NO PARTNERSHIP OR JOINT VENTURE. THE RELATIONSHIP OF EACH BORROWER AND LENDER WILL BE THAT OF DEBTOR AND CREDITOR. IT IS NOT THE INTENTION OF EITHER OF PARENT OR LENDER BY ANY DOCUMENT BEING EXECUTED IN CONNECTION WITH THE CREDIT FACILITY TO ESTABLISH A PARTNERSHIP BETWEEN ANY BORROWER AND LENDER, AND THE BORROWERS AND LENDER SHALL NOT UNDER ANY CIRCUMSTANCES BE CONSTRUED TO BE PARTNERS OR JOINT VENTURERS. 8.14 Standards Applied to Lender's Action. Unless otherwise specifically stipulated elsewhere in the Documents, if a matter is left in the Documents to the decision, right, requirement, request, determination, judgment, opinion, approval, consent, waiver, satisfaction, acceptance, agreement, option, election or discretion of Lender, its employees, Lender's counsel or any agent for or contractor of Lender, such action shall be deemed to be exercisable by Lender or such other person in its sole, absolute and unlimited discretion and according to standards established in its sole and absolute discretion. Without limiting the generality of the foregoing, "option" and "discretion" shall be implied by use of the words "if" or "may." However, whenever this Security Document contains the terms "reasonably satisfactory to Lender," "reasonably determined by Lender," "reasonably acceptable to Lender," "reasonable consent of Lender," "Lender shall reasonably elect," "Lender shall reasonably request," "reasonably approved by Lender" or similar terms wherein the word reasonable or a derivative thereof is used with regard to an action of Lender: (a) such terms shall mean satisfactory to, at the election of, determined by, acceptable to or requested by, as applicable, Lender in its sole (but reasonably exercised) discretion under standards applicable to commercial lenders under the laws of the State of Arizona; and (b) it is the intention of the parties to permit Lender a broad latitude in which to exercise its discretion, acknowledging that, while such discretion may not be exercised arbitrarily or capriciously, it may be exercised conservatively for Lender's protection and benefit. By way of illustration, and not of limitation, it shall not be unreasonable for Lender, in exercising its discretion, to make conservative assumptions regarding the possible outcome of future events. 8.15 Meaning of Subordination. Any subordinations required to be given under the Documents by third parties to Lender shall include the subordination of and the deferral of the right to receive payments on the subordinated obligations except to the extent expressly permitted in this Agreement; the remittances to Lender of all prohibited

8.13 NO PARTNERSHIP OR JOINT VENTURE. THE RELATIONSHIP OF EACH BORROWER AND LENDER WILL BE THAT OF DEBTOR AND CREDITOR. IT IS NOT THE INTENTION OF EITHER OF PARENT OR LENDER BY ANY DOCUMENT BEING EXECUTED IN CONNECTION WITH THE CREDIT FACILITY TO ESTABLISH A PARTNERSHIP BETWEEN ANY BORROWER AND LENDER, AND THE BORROWERS AND LENDER SHALL NOT UNDER ANY CIRCUMSTANCES BE CONSTRUED TO BE PARTNERS OR JOINT VENTURERS. 8.14 Standards Applied to Lender's Action. Unless otherwise specifically stipulated elsewhere in the Documents, if a matter is left in the Documents to the decision, right, requirement, request, determination, judgment, opinion, approval, consent, waiver, satisfaction, acceptance, agreement, option, election or discretion of Lender, its employees, Lender's counsel or any agent for or contractor of Lender, such action shall be deemed to be exercisable by Lender or such other person in its sole, absolute and unlimited discretion and according to standards established in its sole and absolute discretion. Without limiting the generality of the foregoing, "option" and "discretion" shall be implied by use of the words "if" or "may." However, whenever this Security Document contains the terms "reasonably satisfactory to Lender," "reasonably determined by Lender," "reasonably acceptable to Lender," "reasonable consent of Lender," "Lender shall reasonably elect," "Lender shall reasonably request," "reasonably approved by Lender" or similar terms wherein the word reasonable or a derivative thereof is used with regard to an action of Lender: (a) such terms shall mean satisfactory to, at the election of, determined by, acceptable to or requested by, as applicable, Lender in its sole (but reasonably exercised) discretion under standards applicable to commercial lenders under the laws of the State of Arizona; and (b) it is the intention of the parties to permit Lender a broad latitude in which to exercise its discretion, acknowledging that, while such discretion may not be exercised arbitrarily or capriciously, it may be exercised conservatively for Lender's protection and benefit. By way of illustration, and not of limitation, it shall not be unreasonable for Lender, in exercising its discretion, to make conservative assumptions regarding the possible outcome of future events. 8.15 Meaning of Subordination. Any subordinations required to be given under the Documents by third parties to Lender shall include the subordination of and the deferral of the right to receive payments on the subordinated obligations except to the extent expressly permitted in this Agreement; the remittances to Lender of all prohibited payments received by the third party; the subordination of all liens, security interests, assignments and other encumbrances and claims held by a third party on or against any of property of the person owing the indebtedness which is being subordinated, except for Permitted Encumbrances, to Lender's interest (whenever acquired) in such property; and an agreement on the part of the third party not to exercise any remedies against Borrower so long as all obligations under the Documents have not been fully satisfied. 8.16 Publicity. Lender routinely advertises the transactions to which it is a party in newspapers, industry periodicals, and other miscellaneous print and electronic literature. Borrower consents to such advertising and authorizes Lender to use Borrower's name, logo, insignia, descriptive art work, trade name, trademark, or other similar material, whether or not protected by copyright (or otherwise), in any such advertisement. -34-

IX. LENDER'S INSPECTOR. 9.1 Retention of Lender's Inspector. Lender may retain an architectural/engineering firm ("Lender's Inspector") to do the following in connection with Work being done in connection with Improvements being financed in whole or in part under a Development Loan: (a) until Completion of such Work and the making of the last WorkRelated Advance (including the disbursement of the Basic Retainage and Additional Retainage) with respect to such Work, review the related Principal Work-Related Items, the other related Contracts, Licenses, Permits and Other Intangibles and the budget proposed to be the Construction Budget for such Work and any changes to such items; (b) inspect the Real Property prior to commencement of such Work for purposes of determining the condition of the Real Property and any existing improvements; (c) until Completion of such Work and the making of the last Work-Related Advance (including the disbursement of the Basic Retainage and Additional Retainage) with respect to such Work, make monthly inspections of the related Real Property and such Work (whether or not Development Loan proceeds are to be used to pay or reimburse Borrower for the costs of the portion of such Work which has been completed) so that Lender may monitor whether Borrower is in compliance with the terms and conditions of this Agreement, and certifying that each Work-Related Advance Request under the Development Loan is not in excess of the portion of such Work completed and the amount to which the

IX. LENDER'S INSPECTOR. 9.1 Retention of Lender's Inspector. Lender may retain an architectural/engineering firm ("Lender's Inspector") to do the following in connection with Work being done in connection with Improvements being financed in whole or in part under a Development Loan: (a) until Completion of such Work and the making of the last WorkRelated Advance (including the disbursement of the Basic Retainage and Additional Retainage) with respect to such Work, review the related Principal Work-Related Items, the other related Contracts, Licenses, Permits and Other Intangibles and the budget proposed to be the Construction Budget for such Work and any changes to such items; (b) inspect the Real Property prior to commencement of such Work for purposes of determining the condition of the Real Property and any existing improvements; (c) until Completion of such Work and the making of the last Work-Related Advance (including the disbursement of the Basic Retainage and Additional Retainage) with respect to such Work, make monthly inspections of the related Real Property and such Work (whether or not Development Loan proceeds are to be used to pay or reimburse Borrower for the costs of the portion of such Work which has been completed) so that Lender may monitor whether Borrower is in compliance with the terms and conditions of this Agreement, and certifying that each Work-Related Advance Request under the Development Loan is not in excess of the portion of such Work completed and the amount to which the Borrower under the Development Loan is entitled under the terms and conditions of this Agreement; and (d) provide evidence satisfactory to Lender prior to the funding of any Work-Related Advance under the Development Loan that (subject to completion thereof as part of such Work as contemplated by this Agreement), all necessary street, easements and utilities are available to the boundary of the Real Property and that the respective lines and treatment or generator plants are of adequate capacity and size for the intended use of the related Property. Furthermore, Lender may require an inspection by Lender's Inspector of Work which is being done in connection with Improvements being financed under a Development Loan: (a) prior to each WorkRelated Advance under the Development Loan; (b) at least once each month during the course of Completion of such Work; (c) upon Substantial Completion of such Work; (d) upon Completion of such Work; and (e) until Completion of such Work and the making of the last Work-Related Advance (including the disbursement of the related Basic Retainage and Additional Retainage) with respect to such Work, at such other times as Lender may, in its judgment, deem necessary due to actual or suspected non-compliance with the related Plans and Specifications, the related Construction Contract(s), the Loan Documents for the Loan, applicable Legal Requirements, engineering or construction principles or commonly accepted safety standards, or failure of the Borrower under the Loan to satisfy the requirements of the Documents. Any Work which is completed and funded from sources other than a Development Loan Advance shall be subject to inspection by and the approval of Lender's Inspector. 9.2 No Duty of Lender to Supervise, Etc. Lender shall have no duty to supervise or to review and inspect, in connection with any Work, any of the related Principal Work-Related Items, any of the other related Contracts, Licenses, Permits and Other Intangibles, any budget proposed to be a Construction Budget for such Work, any books and records pertaining thereto or any changes to such items or the construction of such Work. Any inspection made by Lender shall be for the sole purpose of determining whether the Obligations are being Performed and preserving Lender's rights under these Documents. If Lender, or Lender's Inspector acting on behalf of Lender, should review or inspect any Principal Work-Related Item, any of the other Contracts, Licenses, Permits and Other Intangibles, any Construction Budget, any books and records pertaining thereto or any changes to such items or the construction of any Work, Lender and Lender's Inspector shall have no liability or obligation to Parent, any Subsidiary which is a Borrower, Borrower or any third person arising out of such inspection; and neither any Parent, any Subsidiary which is a Borrower nor -35-

any third person shall be entitled to rely upon any such inspection or review. Inspection not followed by notice of an Event of Default shall not constitute (a) waiver of any Event of Default then existing; (b) an acknowledgment or representation by Lender or Lender's Inspector that there has been or will be compliance with any Principal Work-Related Item, any of the other Contracts, Licenses, Permits and Other Intangibles, any Construction Budget, Legal Requirements, sound construction, engineering or architectural principles or commonly accepted safety standards, or that the construction is lien free or free from defective materials or workmanship; or (c) a waiver of Lender's right thereafter to insist that Completion of the Work being financed in whole or in part under a Development Loan occur in accordance with the related Principal Work-Related Items, the other related Contracts, Licenses, Permits and Other Intangibles, the related Construction Budget, the Documents, Legal

any third person shall be entitled to rely upon any such inspection or review. Inspection not followed by notice of an Event of Default shall not constitute (a) waiver of any Event of Default then existing; (b) an acknowledgment or representation by Lender or Lender's Inspector that there has been or will be compliance with any Principal Work-Related Item, any of the other Contracts, Licenses, Permits and Other Intangibles, any Construction Budget, Legal Requirements, sound construction, engineering or architectural principles or commonly accepted safety standards, or that the construction is lien free or free from defective materials or workmanship; or (c) a waiver of Lender's right thereafter to insist that Completion of the Work being financed in whole or in part under a Development Loan occur in accordance with the related Principal Work-Related Items, the other related Contracts, Licenses, Permits and Other Intangibles, the related Construction Budget, the Documents, Legal Requirements, sound construction, engineering or architectural principles or commonly-accepted safety standards and free from defective materials and workmanship. Lender and Lender's Inspector owe no duty of care to any Borrower under a Development Loan or any third person to protect against, or inform such Borrower or any third person of, the existence of negligence, faulty, inadequate or defective design or construction of the Work being financed in whole or in part under such Development Loan. Without limiting the generality of the foregoing, Lender will deliver or cause to be delivered to Borrower, within a reasonable time after their delivery to Lender, copies of any written reports of Lender's Inspector. IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed in their respective name, personally or by their duly authorized representatives as of the date above written. PARENT: BLUEGREEN CORPORATION, a Massachusetts corporation
By: /s/ PATRICK E. RONDEAU --------------------------------Type/Print Name: Patrick E. Rondeau Title: Sr. Vice President

LENDER: FINOVA CAPITAL CORPORATION, a Delaware corporation
By: /s/ SUSAN BABBITT --------------------------------Type/Print Name: Susan Babbitt Title: Vice President

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EXHIBIT 10.135 Loan No.98-087 ACQUISITION COST REIMBURSEMENT LOAN AGREEMENT THIS ACQUISITION COST REIMBURSEMENT LOAN AGREEMENT (as amended and supplemented from time to time, this "AGREEMENT"), dated as of September 14, 1999, is made by and between HELLER FINANCIAL, INC., a Delaware corporation ("LENDER"), whose address is 31st Floor, 500 West Monroe Street, Chicago, Illinois 60661, and BLUEGREEN VACATIONS UNLIMITED, INC., a Florida corporation ("BORROWER"), whose address is 4960 Blue Lake Drive, Boca Raton, Florida 33431. RECITALS: A. Borrower desires Lender to extend a secured loan to Borrower in accordance with the terms of this Agreement and that certain Master Agreement, dated as of October 15, 1998, between Lender and Bluegreen Corporation ("GUARANTOR"), a Massachusetts corporation (as amended and supplemented from time to time, the "MASTER AGREEMENT"), for the purpose of reimbursing Borrower for certain acquisition costs incurred in connection with the acquisition and renovation of the Lodge Alley Resort (as defined herein).

EXHIBIT 10.135 Loan No.98-087 ACQUISITION COST REIMBURSEMENT LOAN AGREEMENT THIS ACQUISITION COST REIMBURSEMENT LOAN AGREEMENT (as amended and supplemented from time to time, this "AGREEMENT"), dated as of September 14, 1999, is made by and between HELLER FINANCIAL, INC., a Delaware corporation ("LENDER"), whose address is 31st Floor, 500 West Monroe Street, Chicago, Illinois 60661, and BLUEGREEN VACATIONS UNLIMITED, INC., a Florida corporation ("BORROWER"), whose address is 4960 Blue Lake Drive, Boca Raton, Florida 33431. RECITALS: A. Borrower desires Lender to extend a secured loan to Borrower in accordance with the terms of this Agreement and that certain Master Agreement, dated as of October 15, 1998, between Lender and Bluegreen Corporation ("GUARANTOR"), a Massachusetts corporation (as amended and supplemented from time to time, the "MASTER AGREEMENT"), for the purpose of reimbursing Borrower for certain acquisition costs incurred in connection with the acquisition and renovation of the Lodge Alley Resort (as defined herein). B. Borrower's obligations hereunder and under the other Lodge Alley Loan Documents (as defined herein) will be secured, INTER ALIA, by liens with the priority specified herein on certain real property, the improvements thereon, and related personal property and receivables owned or to be owned by Borrower in respect thereof (other than Lodge Alley Note Receivables). NOW, THEREFORE, in consideration of the foregoing premises and the agreements, provisions and covenants herein contained, Borrower and Lender agree as follows: ARTICLE 1 - DEFINITIONS 1.1 DEFINED TERMS. All capitalized terms used herein, unless otherwise defined, shall have the meanings ascribed thereto in the appendix attached hereto and made a part hereof by this reference. ARTICLE 2 - LOAN 2.1 DISBURSEMENT OF LODGE ALLEY LOAN. On the date of this Agreement, and subject to the satisfaction of the conditions precedent specified in Section 2.2 of this Agreement, Lender shall disburse Fourteen Million Twenty-Five Thousand and 00/100 Dollars ($14,025,000.00), the entire amount of the Lodge Alley Loan, directly to or for the account of Borrower, less any costs and fees set forth herein. The proceeds of the Lodge Alley Loan shall be used to reimburse the Borrower for the costs and out-of-pocket disbursements paid by the Borrower in connection with the acquisition of the Lodge Alley Resort, as more particularly detailed on Schedule 1 hereto, and to pay closing costs incurred in connection with the making of the Lodge Alley Loan. The Lodge Alley Resort shall be free and clear of all liens and encumbrances except for the liens

created herein or in any of the other Lodge Alley Loan Documents and except for any other Lodge Alley Permitted Exceptions. There shall be no further advances or loans hereunder. The Lodge Alley Loan shall be deemed to be, and shall be, a "Resort Loan" under, and as defined in, the Master Agreement. 2.2 TERM. The Lodge Alley Loan shall mature and be due and payable on the Lodge Alley Loan Maturity Date. 2.3 INTEREST RATE. The outstanding principal balance of the Lodge Alley Loan shall bear interest at the Interest Rate; PROVIDED, HOWEVER, that upon the occurrence and during the continuance of an Event of Default the Lodge Alley Loan will bear interest at the Default Rate. Interest on the Lodge Alley Loan shall be paid by Borrower to Lender monthly in arrears, commencing on the 1st day of the first month following the date hereof, and continuing on the first day of each month thereafter until payment of the Lodge Alley Loan in full. 2.4 PREPAYMENTS. The Lodge Alley Loan may be prepaid in whole, but not in part, at any time upon five (5)

created herein or in any of the other Lodge Alley Loan Documents and except for any other Lodge Alley Permitted Exceptions. There shall be no further advances or loans hereunder. The Lodge Alley Loan shall be deemed to be, and shall be, a "Resort Loan" under, and as defined in, the Master Agreement. 2.2 TERM. The Lodge Alley Loan shall mature and be due and payable on the Lodge Alley Loan Maturity Date. 2.3 INTEREST RATE. The outstanding principal balance of the Lodge Alley Loan shall bear interest at the Interest Rate; PROVIDED, HOWEVER, that upon the occurrence and during the continuance of an Event of Default the Lodge Alley Loan will bear interest at the Default Rate. Interest on the Lodge Alley Loan shall be paid by Borrower to Lender monthly in arrears, commencing on the 1st day of the first month following the date hereof, and continuing on the first day of each month thereafter until payment of the Lodge Alley Loan in full. 2.4 PREPAYMENTS. The Lodge Alley Loan may be prepaid in whole, but not in part, at any time upon five (5) days prior written notice to Lender. Any prepayment under this Section 2.4 shall be accompanied by all accrued and unpaid interest, if any, then due with respect to the Lodge Alley Loan and all Costs and expenses then outstanding, and shall be applied in the following order: first to the payment of Costs and other expenses payable to Lender pursuant to this Agreement; second, to the payment of accrued but unpaid interest on the Lodge Alley Loan; and thereafter to the reduction of the principal balance of the Lodge Alley Loan. For the avoidance of doubt, no prepayment premium shall be due and payable under this Section 2.4. 2.5 GRANT OF SECURITY INTEREST. To secure the payment and performance of all of the Indebtedness and all of the obligations of Borrower under this Agreement and/or under any of the other Lodge Alley Loan Documents and the Borrower's undertakings hereunder and under the other Lodge Alley Loan Documents and the payment and performance of the obligations of Borrower or any other borrower under the Master Agreement in respect of any Resort Loan (as such term is defined in the Master Agreement) owing to Lender under any other Resort Loan Documents (as such term is defined in the Master Agreement) and the payment and performance of the obligations of the Borrower and/or the Guarantor under the Warehouse Facility, Borrower does hereby unconditionally and irrevocably assign, pledge and grant to Lender a continuing security interest and lien in and to all of the right, title and interest of Borrower in the following property of Borrower, whether now owned or existing or hereafter acquired regardless of where located (collectively, the "LODGE ALLEY COLLATERAL"): (a) all franchises, licenses, permits, trade names, trademarks (and goodwill associated therewith)(provided that no lien is intended to be granted in the trade name or trademark "Bluegreen" or any logo used in connection therewith), approvals, leasehold interests (whether as lessor or lessee or sublessor or sublessee), management contracts, marketing contracts, maintenance contracts, utility contracts, security contracts, other servicing contracts, licensing contracts or other similar contracts and all guaranties of any of the foregoing relating, in each case, to the Lodge Alley Resort, the Lodge Alley 2

Intervals, the Lodge Alley Commercial Condominium Units and/or the Common Elements or Limited Common Elements (as such terms are defined in the Lodge Alley Inn Master Deed); (b) all other accounts, contract rights, general intangibles, documents, instruments, chattel paper and proceeds of Borrower related to the Lodge Alley Resort or otherwise connected with, or related to, the operation and/or renovation, management and use of the Lodge Alley Resort (other than the Lodge Alley Note Receivables); (c) all fixtures, inventory, supplies, fittings, machinery, appliances, equipment, apparatus, furnishings, and personal Property of every nature found on or used in connection with the Lodge Alley Resort, including, without limitation, guest room furnishings, linens, dishware, blinds, floor coverings, hall and lobby equipment, security systems, sprinkler systems, other fire prevention and extinguishing apparatus, reservation system computer and related equipment, artwork, paintings, prints, sculpture, and office furnishings and equipment; (d) (i) the Lodge Alley Resort, including, without limitation, all Lodge Alley Intervals, Lodge Alley Residential Condominium Units and Lodge Alley Commercial Condominium Units (now existing or hereafter created)

Intervals, the Lodge Alley Commercial Condominium Units and/or the Common Elements or Limited Common Elements (as such terms are defined in the Lodge Alley Inn Master Deed); (b) all other accounts, contract rights, general intangibles, documents, instruments, chattel paper and proceeds of Borrower related to the Lodge Alley Resort or otherwise connected with, or related to, the operation and/or renovation, management and use of the Lodge Alley Resort (other than the Lodge Alley Note Receivables); (c) all fixtures, inventory, supplies, fittings, machinery, appliances, equipment, apparatus, furnishings, and personal Property of every nature found on or used in connection with the Lodge Alley Resort, including, without limitation, guest room furnishings, linens, dishware, blinds, floor coverings, hall and lobby equipment, security systems, sprinkler systems, other fire prevention and extinguishing apparatus, reservation system computer and related equipment, artwork, paintings, prints, sculpture, and office furnishings and equipment; (d) (i) the Lodge Alley Resort, including, without limitation, all Lodge Alley Intervals, Lodge Alley Residential Condominium Units and Lodge Alley Commercial Condominium Units (now existing or hereafter created) (whether sold or unsold), (ii) the Lodge Alley Inn Master Deed (including, without limitation, Borrower's development and declarant's rights (but not obligations) under applicable law), the Lodge Alley Master Deed and the Lodge Alley Courtyard Restrictive Covenants, (iii) all building materials, supplies and other Property now or hereafter stored at or delivered to the Lodge Alley Resort or any other location for installation in or on the Lodge Alley Resort, (iv) any and all plans, specifications, drawings, books, records, marketing materials and similar items now or hereafter relating to the Lodge Alley Resort, the operation and use thereof, any rights of Borrower thereto or any interest therein, (v) the renovation construction contract for Lodge Alley Resort and the architect and engineering contracts entered into or to be entered into by Borrower in connection with such renovations and (vi) any payment, performance or other surety bonds obtained by any contractor or subcontractor in connection with such refurbishing; (e) all judgments, settlements, claims, awards, insurance proceeds and other proceeds and compensation, and any interest thereon (collectively, "COMPENSATION"), now or hereafter made or payable in connection with (i) any casualty or other damage to all or any part of the Lodge Alley Resort, (ii) any condemnation proceedings affecting all or any part of any of the Lodge Alley Resort or any rights thereto or any interest therein, (iii) any damage to or taking of all or any part of the Lodge Alley Resort, or any rights thereto or any interest therein arising from or otherwise relating to any exercise of the power of eminent domain (including, without limitation, any and all Compensation for change of grade of streets or any other injury to or decrease in the value of any of the Lodge Alley Resort), or any conveyance in lieu of or under threat of any such taking, (iv) any and all proceeds of any sale, assignment or other disposition of all or any part of 3

the Lodge Alley Resort or any rights thereto or any interest therein, (v) any and all proceeds of any other conversion (whether voluntary or involuntary) of all or any part of the Lodge Alley Resort or any rights thereto or any interest therein or to cash or any liquidated claim, and (vi) any and all refunds and rebates of or with respect to any insurance premium, any imposition or any other charge for utilities relating to all or any part of the Lodge Alley Resort (including, without limitation, any and all refunds and rebates of or with respect to any deposit or prepayment relating to any such insurance premium, imposition or charge), and any and all interest thereon, whether now or hereafter payable or accruing; and (f) All cash and other monies and property of Borrower in the possession or under the control of Lender or any agent thereof; (g) All books, records, ledger cards, files, correspondence, computer tapes, disks and software relating to the Lodge Alley Resort or any other Lodge Alley Collateral described herein; (h) all of the collateral granted to Lender in the Lodge Alley Mortgage; (i) all of the collateral granted to Lender in the Lodge Alley Assignment of Leases and Rents and in any other Lodge Alley Loan Document; and

the Lodge Alley Resort or any rights thereto or any interest therein, (v) any and all proceeds of any other conversion (whether voluntary or involuntary) of all or any part of the Lodge Alley Resort or any rights thereto or any interest therein or to cash or any liquidated claim, and (vi) any and all refunds and rebates of or with respect to any insurance premium, any imposition or any other charge for utilities relating to all or any part of the Lodge Alley Resort (including, without limitation, any and all refunds and rebates of or with respect to any deposit or prepayment relating to any such insurance premium, imposition or charge), and any and all interest thereon, whether now or hereafter payable or accruing; and (f) All cash and other monies and property of Borrower in the possession or under the control of Lender or any agent thereof; (g) All books, records, ledger cards, files, correspondence, computer tapes, disks and software relating to the Lodge Alley Resort or any other Lodge Alley Collateral described herein; (h) all of the collateral granted to Lender in the Lodge Alley Mortgage; (i) all of the collateral granted to Lender in the Lodge Alley Assignment of Leases and Rents and in any other Lodge Alley Loan Document; and (j) All proceeds, extensions, amendments, additions, improvements, betterments, renewals, substitutions and replacements of the foregoing. This Agreement shall be deemed a security agreement as defined in the Code, and the remedies for any violation of the covenants, terms and conditions of the agreements herein contained shall be cumulative and be as prescribed herein, or by general law, or as to such part of the Collateral which is also reflected in any filed financing statement, by the specific provisions of the Code now or hereafter enacted, all at Lender's sole election. All terms defined used herein and defined in the UCC shall have the meanings provided for therein, as the same may be amended from time to time. 2.6 LODGE ALLEY RELEASES. Notwithstanding any provision of this Agreement or any other Lodge Alley Loan Document to the contrary, the lien of the Lodge Alley Mortgage, the Lodge Alley Assignment of Leases and Rents and any and all related fixture filing(s) or other UCC-1 financing statements recorded in the real property records in favor of Lender in connection with the Lodge Alley Loan shall be released upon the conveyance by the Borrower of fee title to a Purchaser of a Lodge Alley Interval in the ordinary course of Borrower's business or to the purchaser of a Lodge Alley Commercial Condominium Unit in the ordinary course of Borrower's business if, but only if, (a) Lender receives a written request from Borrower not less than three (3) Business Days prior to the requested date of release together with all release documentation (including, without limitation, a partial release of the Lodge Alley Mortgage) in form and substance reasonably satisfactory to Lender, (b) no Event of Default or event or 4

circumstance that, with the giving of notice or passage of time or both, could give rise to an Event of Default has occurred and is continuing, (c) the applicable Lodge Alley Release Price is paid to Lender in connection therewith and (d) all Costs and expenses of Lender in respect of any such releases, the filing of the same and any escrow conditions applicable in respect thereof shall have been paid by Borrower. For the avoidance of doubt, the Lender shall have no lien or security interest in any Lodge Alley Note Receivable and no Lodge Alley Note Receivable shall be included, or be deemed to be included, in any of the Lodge Alley Collateral provided for herein or in any other Lodge Alley Loan Documents. 2.7 CONDITIONS PRECEDENT TO DISBURSEMENT OF LODGE ALLEY LOAN. The following conditions precedent to the disbursement of the Lodge Alley Loan hereunder must be satisfied prior to the disbursement of the Lodge Alley Loan: (a) Borrower shall have executed and delivered to, procured for and deposited with, and, if appropriate, recorded in the proper records with all filing and recording fees and stamp and intangibles taxes paid, the Lodge Alley Mortgage, the Lodge Alley Assignment of Leases and Rents and the Lodge Alley UCC Financing

circumstance that, with the giving of notice or passage of time or both, could give rise to an Event of Default has occurred and is continuing, (c) the applicable Lodge Alley Release Price is paid to Lender in connection therewith and (d) all Costs and expenses of Lender in respect of any such releases, the filing of the same and any escrow conditions applicable in respect thereof shall have been paid by Borrower. For the avoidance of doubt, the Lender shall have no lien or security interest in any Lodge Alley Note Receivable and no Lodge Alley Note Receivable shall be included, or be deemed to be included, in any of the Lodge Alley Collateral provided for herein or in any other Lodge Alley Loan Documents. 2.7 CONDITIONS PRECEDENT TO DISBURSEMENT OF LODGE ALLEY LOAN. The following conditions precedent to the disbursement of the Lodge Alley Loan hereunder must be satisfied prior to the disbursement of the Lodge Alley Loan: (a) Borrower shall have executed and delivered to, procured for and deposited with, and, if appropriate, recorded in the proper records with all filing and recording fees and stamp and intangibles taxes paid, the Lodge Alley Mortgage, the Lodge Alley Assignment of Leases and Rents and the Lodge Alley UCC Financing Statements and such other documents, instruments, and certificates as Lender or Title Company may require. (b) The Title Company shall have issued or committed in writing to issue to Lender the Title Insurance with satisfactory insurance coverage over mechanics' liens arising from any renovation at the Lodge Alley Resort together with such other coverage and endorsements as Lender may reasonably require subject to the Lodge Alley Permitted Exceptions. Borrower shall disclose to Lender any indemnity or other arrangement or agreement between Borrower and Title Company entered into in order to induce Title Company to issue the Title Insurance as required by this Agreement. Lender shall have also received satisfactory evidence that all security interests and liens granted to Lender pursuant to this Agreement or the other Lodge Alley Loan Documents have been duly perfected and constitute first priority liens on the Collateral. (c) The Borrower shall have executed and delivered to Lender a collateral assignment of all contracts and agreements in respect of the Lodge Alley Resort. (d) The Borrower shall have executed and delivered to Lender a collateral assignment of all permits, licenses, and parking rights and passes in respect of the Lodge Alley Resort. (e) The Borrower shall have executed and delivered to Lender a collateral assignment of all of its rights as developer and/or declarant (but not its obligations) under the Phase I of the Lodge Alley Inn Master Deed and the Lodge Alley Master Deed. (f) Lender shall have been paid the portion of the Commitment Fee, as defined in the Master Agreement, as required by the Master Agreement. Borrower and 5

Lender agree that the portion of said Commitment Fee due on the funding of the Lodge Alley Loan is $140,025. Borrower hereby requests and authorizes Lender to deduct said fee from the proceeds of the Lodge Alley Loan to be funded to Borrower hereunder. (g) The Guarantor shall have executed and delivered to Lender the Lodge Alley Guaranty Agreement and the Lodge Alley Completion Guaranty Agreement. (h) Lender shall have received all documents, instruments and information identified on Schedule 2, including, without limitation, the Appraisal, provided that the items on Schedule 2 denoted with an asterisk shall be delivered by the Borrower not later than 10 days after the date hereof and such delivery shall be, and is hereby made, an undertaking of the Borrower, the violation of which shall be immediate Event of Default hereunder. (i) Lender shall have received, in form and substance satisfactory to Lender, an executed legal opinion, issued by counsel to Borrower and Guarantor acceptable to Lender, in form and content acceptable to Lender, with respect to this Agreement and the other Lodge Alley Loan Documents and the Lodge Alley Resort.

Lender agree that the portion of said Commitment Fee due on the funding of the Lodge Alley Loan is $140,025. Borrower hereby requests and authorizes Lender to deduct said fee from the proceeds of the Lodge Alley Loan to be funded to Borrower hereunder. (g) The Guarantor shall have executed and delivered to Lender the Lodge Alley Guaranty Agreement and the Lodge Alley Completion Guaranty Agreement. (h) Lender shall have received all documents, instruments and information identified on Schedule 2, including, without limitation, the Appraisal, provided that the items on Schedule 2 denoted with an asterisk shall be delivered by the Borrower not later than 10 days after the date hereof and such delivery shall be, and is hereby made, an undertaking of the Borrower, the violation of which shall be immediate Event of Default hereunder. (i) Lender shall have received, in form and substance satisfactory to Lender, an executed legal opinion, issued by counsel to Borrower and Guarantor acceptable to Lender, in form and content acceptable to Lender, with respect to this Agreement and the other Lodge Alley Loan Documents and the Lodge Alley Resort. (j) The representations and warranties contained herein and in the other Lodge Alley Loan Documents shall be true, correct and complete in all material respects on and as of the date of funding of the Lodge Alley Loan. (k) Borrower shall have performed in all material respects all agreements, paid all fees, Costs and expenses and satisfied all conditions which any Lodge Alley Loan Document or the Master Agreement provides shall be paid or performed by it as a condition to the making of the Lodge Alley Loan. (l) Borrower shall have obtained all approvals, licenses, permits and consents for Borrower's acquisition, renovation, timesharing, use and operating of the Lodge Alley Resort. (m) There shall then exist no Event of Default or event that with the giving of notice or passage of time would constitute an Event of Default. (n) There shall then exist no Termination Event, as such term is defined in the Master Agreement, or event that with the giving of notice or passage of time would constitute a Termination Event. ARTICLE 3 - REPRESENTATIONS AND WARRANTIES OF BORROWER Borrower hereby represents and warrants as follows: 6

3.1 EXISTENCE. Borrower is in good standing under the laws of the State of Florida and is authorized to transact business in the State of South Carolina. The Guarantor owns 100% of the issued and outstanding stock of Borrower. 3.2 AUTHORIZATION AND ENFORCEABILITY. (a) EXECUTION. The Lodge Alley Loan Documents have been duly authorized, executed and delivered and constitute the duly authorized, valid and legally binding obligations of Borrower, enforceable against Borrower in accordance with their respective terms. (b) OTHER AGREEMENTS. The execution, delivery and compliance with the terms and provisions of the Lodge Alley Loan Documents will not (i) to the best of Borrower's knowledge, violate any provisions of law or any applicable regulation, order or other decree of any court or governmental entity, or (ii) conflict or be inconsistent with, or result in any default under, any contract, agreement or commitment to which Borrower is bound. 3.3 FINANCIAL STATEMENTS AND BUSINESS CONDITION. The financial statements of the Borrower and the Guarantor and the other consolidated companies therein fairly present the financial conditions and results of operations of such Persons as of the date or dates thereof and for the periods covered thereby. All such

3.1 EXISTENCE. Borrower is in good standing under the laws of the State of Florida and is authorized to transact business in the State of South Carolina. The Guarantor owns 100% of the issued and outstanding stock of Borrower. 3.2 AUTHORIZATION AND ENFORCEABILITY. (a) EXECUTION. The Lodge Alley Loan Documents have been duly authorized, executed and delivered and constitute the duly authorized, valid and legally binding obligations of Borrower, enforceable against Borrower in accordance with their respective terms. (b) OTHER AGREEMENTS. The execution, delivery and compliance with the terms and provisions of the Lodge Alley Loan Documents will not (i) to the best of Borrower's knowledge, violate any provisions of law or any applicable regulation, order or other decree of any court or governmental entity, or (ii) conflict or be inconsistent with, or result in any default under, any contract, agreement or commitment to which Borrower is bound. 3.3 FINANCIAL STATEMENTS AND BUSINESS CONDITION. The financial statements of the Borrower and the Guarantor and the other consolidated companies therein fairly present the financial conditions and results of operations of such Persons as of the date or dates thereof and for the periods covered thereby. All such financial statements were prepared in accordance with GAAP. Except for any such changes heretofore expressly disclosed in writing to Lender, there has been no material adverse change in the financial condition of the Borrower, the Guarantor or any of its consolidated subsidiaries from the financial condition shown in such consolidated financial statements. Borrower is able to pay all of its debts as they become due, and Borrower shall maintain such solvent financial condition, giving effect to all obligations, absolute and contingent, of Borrower. Borrower's obligations under this Agreement will not render it unable to pay its debts as they become due. The present fair market value of Borrower's assets is greater than the amount required to pay its total liabilities. 3.4 TAXES. All ad valorem taxes and other taxes and assessments against the Lodge Alley Resort have been paid and Borrower knows of no basis for any additional taxes or assessments against such property. Borrower has filed all required tax returns and has paid all taxes shown to be due and payable on such returns, including interest and penalties, and all other taxes which are payable by it, to the extent the same have become due and payable. Borrower shall collect and pay, or shall use commercially reasonable efforts to cause the Lodge Alley Inn Association and/or the Lodge Alley Association to collect and pay, any applicable sales or rental tax respecting the sale or rental of any Lodge Alley Intervals, Lodge Alley Residential Condominium units, Lodge Alley Commercial Condominium Units and the condominium units subject to the Lodge Alley Master Deed, in each case, owned by Borrower. 3.5 LITIGATION AND PROCEEDINGS. Except as set forth on Schedule 3 hereto, there are no actions, suits, proceedings, orders or injunctions pending or, to the best of Borrower's knowledge, threatened against or affecting Borrower, at law or in equity, or before or by any 7

governmental entity which, if adversely determined, could have, either individually or in the aggregate, a Material Adverse Effect. Borrower has not received any notice from any court or governmental entity alleging that Borrower has violated any applicable Governmental Regulation, any of the rules or regulations thereunder, or any other applicable laws, the result of which, if adversely determined, would have, individually or in the aggregate, a Material Adverse Effect. 3.6 VALID AND BINDING OBLIGATION, NO BREACH OR DEFAULT. All of the Lodge Alley Loan Documents, and all other documents referred to herein to which Borrower is a party, upon execution and delivery will constitute valid and binding obligations of Borrower, enforceable in accordance with their terms except as limited by Debtor Relief Laws. The consummation of the transactions contemplated hereby, and the performance of any of the terms and conditions hereof and of the other Lodge Alley Loan Documents, will not result in a breach of, or constitute a default in Borrower's organizational documents or in any mortgage, deed of trust, lease, promissory note, loan agreement, credit agreement, partnership agreement, or other agreement to which Borrower is a party or by which Borrower may be bound or affected. To the best of its knowledge, the

governmental entity which, if adversely determined, could have, either individually or in the aggregate, a Material Adverse Effect. Borrower has not received any notice from any court or governmental entity alleging that Borrower has violated any applicable Governmental Regulation, any of the rules or regulations thereunder, or any other applicable laws, the result of which, if adversely determined, would have, individually or in the aggregate, a Material Adverse Effect. 3.6 VALID AND BINDING OBLIGATION, NO BREACH OR DEFAULT. All of the Lodge Alley Loan Documents, and all other documents referred to herein to which Borrower is a party, upon execution and delivery will constitute valid and binding obligations of Borrower, enforceable in accordance with their terms except as limited by Debtor Relief Laws. The consummation of the transactions contemplated hereby, and the performance of any of the terms and conditions hereof and of the other Lodge Alley Loan Documents, will not result in a breach of, or constitute a default in Borrower's organizational documents or in any mortgage, deed of trust, lease, promissory note, loan agreement, credit agreement, partnership agreement, or other agreement to which Borrower is a party or by which Borrower may be bound or affected. To the best of its knowledge, the Borrower is not in default of any order of any court or any requirement of any governmental entity that would result in a Material Adverse Effect. 3.7 TITLE; LICENSES AND PERMITS. Borrower has good and marketable fee simple title to the real property constituting the Lodge Alley Resort free and clear of all liens except for the Lodge Alley Permitted Exceptions and good title to all personal property constituting the Lodge Alley Resort free and clear of all liens except for the Lodge Alley Permitted Exceptions. Borrower possesses all requisite franchises, certificates of convenience and necessity, operating rights, licenses, permits, consents, authorizations, exemptions and orders as are necessary to carry on its business as now being conducted, except where the failure to possess the same would not, individually or in the aggregate, have a Material Adverse Effect. There are no pending or threatened proceedings or actions to revoke, attack, invalidate, rescind or modify such franchises, certificates of convenience and necessity, operating rights, licenses, permits, consents, authorizations, exemptions and orders or any zoning in respect of the Lodge Alley Resort or asserting that such zoning does not permit the occupancy, use or operation of the Lodge Alley Resort as currently and proposed to be operated. 3.8 DISCLOSURE. There is no fact of which Borrower is aware that Borrower has not disclosed to Lender in writing that could materially adversely affect the property, business or financial condition of Borrower. Borrower has furnished Lender with a true and complete copy of all documents relating to the renovation and timesharing of the Lodge Alley Resort. 3.9 EMPLOYEE BENEFIT PLANS. Borrower is in compliance in all material respects with all applicable provisions of the Employee Retirement Income Security Act, the Internal Revenue Code and all other applicable laws and the regulations and interpretations thereof with respect to all employee benefit plans adopted by Borrower for the benefit of its employees. No material liability has been incurred by Borrower which remains unsatisfied for any funding obligation, taxes or penalties with respect to any such employee benefit plan. 8

3.10 SYSTEM COMPLIANCE AND ADEQUACY. To the best of Borrower's knowledge, the storm and sanitary sewer system, water system and all mechanical systems of the Lodge Alley Resort comply with all applicable environmental, pollution control and ecological laws, ordinances, rules and regulations, and all governmental entities having jurisdiction over Lodge Alley Resort have issued all necessary permits, licenses or other authorizations for the use and operation of such property. To the best of Borrower's knowledge, the Lodge Alley Resort has adequate storm and sanitary sewage facilities, water and electrical supply, and other required public utilities. 3.11 SUBMITTALS. The Lodge Alley Loan Documents and all financial statements, refurbishing plans, budgets, schedules, opinions, certificates, confirmations, contractor's statements, applications, rent rolls, affidavits, agreements, and other materials submitted to the Lender in connection with or in furtherance of the Lodge Alley Loan Documents by or on behalf of the Borrower fully and fairly state in all material respects the matters with which they purport to deal, and neither misstate any material fact, nor, separately or in the aggregate, fail to state any material fact necessary to make the statements made not misleading; PROVIDED, HOWEVER, that such representation and warranty is made to the best of Borrower's knowledge with respect to such materials

3.10 SYSTEM COMPLIANCE AND ADEQUACY. To the best of Borrower's knowledge, the storm and sanitary sewer system, water system and all mechanical systems of the Lodge Alley Resort comply with all applicable environmental, pollution control and ecological laws, ordinances, rules and regulations, and all governmental entities having jurisdiction over Lodge Alley Resort have issued all necessary permits, licenses or other authorizations for the use and operation of such property. To the best of Borrower's knowledge, the Lodge Alley Resort has adequate storm and sanitary sewage facilities, water and electrical supply, and other required public utilities. 3.11 SUBMITTALS. The Lodge Alley Loan Documents and all financial statements, refurbishing plans, budgets, schedules, opinions, certificates, confirmations, contractor's statements, applications, rent rolls, affidavits, agreements, and other materials submitted to the Lender in connection with or in furtherance of the Lodge Alley Loan Documents by or on behalf of the Borrower fully and fairly state in all material respects the matters with which they purport to deal, and neither misstate any material fact, nor, separately or in the aggregate, fail to state any material fact necessary to make the statements made not misleading; PROVIDED, HOWEVER, that such representation and warranty is made to the best of Borrower's knowledge with respect to such materials submitted to Lender which were prepared by parties other than Borrower, the Guarantor or their respective employees. 3.12 GOVERNMENTAL REQUIREMENTS. The Lodge Alley Resort is and at all times during the Lodge Alley Loan will be used, operated and sold in compliance with all zoning requirements (including parking and density requirements or limitations), building codes, subdivision improvement agreements, licensing requirements, all covenants, conditions and restrictions of record, and all other Governmental Requirements and there are no Governmental Requirements prohibiting the use and operation of such Resort for timeshare purposes (including, without limitation, the zoning code of the City of Charleston, South Carolina). The zoning and subdivision approval of the Lodge Alley Resort and the right and ability to use or operate such Resort are not in any way dependent on or related to any real estate other than such Resort. To Borrower's knowledge, there are no, nor are there any alleged or asserted, violations of Governmental Requirements, law, regulations, ordinances, codes, permits, licenses, declarations, covenants, conditions, or restrictions of record, or other agreements relating to the Lodge Alley Resort or any part thereof. Borrower has obtained or is not aware of reasons why it cannot obtain all necessary permits, licenses, consents and approvals (including obtaining sufficient parking spaces and meeting all applicable density requirements) to use and operate the Lodge Alley Resort as a vacation time sharing ownership plan, condominium and hotel in accordance with the requirements of this Agreement and applicable law and to sell the Lodge Alley Intervals, Lodge Alley Residential Condominium Units and Lodge Alley Commercial Condominium Units therein in full compliance with applicable law. 3.13 PROPERTY ACCESS. Lodge Alley Resort has adequate direct access to improved publicly dedicated roads. 9

3.14 FLOOD HAZARDS/WETLANDS. Except as disclosed in the Survey, the Lodge Alley Resort is not located in a flood zone as defined in the Flood Disaster Protection Act of 1973, as amended, and such Resort is not located within a wetlands as defined by any Governmental Authority. 3.15 CONTRACTS WITH AFFILIATES. Except for the relationships and transactions (the "APPROVED TRANSACTIONS") disclosed to Lender in writing and set forth on Schedule 4, Borrower does not own any stock or interest in any other Person or have any affiliates which have any involvement or interest in the Lodge Alley Resort in any way. All Approved Transactions were negotiated in good faith, are arms-length transactions and all terms, covenants and conditions which govern the Approved Transactions are at market rate. 3.16 ENVIRONMENTAL LAWS. Except as set forth on Schedule 5 hereto, the Lodge Alley Resort is free of presence of all potentially unhealthy, harmful or unlawful Hazardous Material. Except as set forth on Schedule 5 hereto, neither Borrower nor Guarantor, or to Borrower's knowledge, any other Person has ever caused or permitted any Hazardous Materials to be used, handled, placed, held, stored, located, discharged, released, manufactured, treated, processed, produced, generated, transported or otherwise managed on, under or at the Lodge Alley Resort or any part thereof.

3.14 FLOOD HAZARDS/WETLANDS. Except as disclosed in the Survey, the Lodge Alley Resort is not located in a flood zone as defined in the Flood Disaster Protection Act of 1973, as amended, and such Resort is not located within a wetlands as defined by any Governmental Authority. 3.15 CONTRACTS WITH AFFILIATES. Except for the relationships and transactions (the "APPROVED TRANSACTIONS") disclosed to Lender in writing and set forth on Schedule 4, Borrower does not own any stock or interest in any other Person or have any affiliates which have any involvement or interest in the Lodge Alley Resort in any way. All Approved Transactions were negotiated in good faith, are arms-length transactions and all terms, covenants and conditions which govern the Approved Transactions are at market rate. 3.16 ENVIRONMENTAL LAWS. Except as set forth on Schedule 5 hereto, the Lodge Alley Resort is free of presence of all potentially unhealthy, harmful or unlawful Hazardous Material. Except as set forth on Schedule 5 hereto, neither Borrower nor Guarantor, or to Borrower's knowledge, any other Person has ever caused or permitted any Hazardous Materials to be used, handled, placed, held, stored, located, discharged, released, manufactured, treated, processed, produced, generated, transported or otherwise managed on, under or at the Lodge Alley Resort or any part thereof. 3.17 INDEBTEDNESS OF BORROWER OR GUARANTOR. Neither Borrower nor Guarantor has incurred any indebtedness which is secured, wholly or in part, by the Lodge Alley Resort or any part thereof (other than the Lodge Alley Loan). 3.18 STATUS OF THE PHASE I BUILDINGS. Each of the Knapp building (denoted as Tract C-1 on the Survey) and Griffith building (denoted as Tract C-6 on the Survey) in Phase I is a condominium with the number of Lodge Alley Residential Condominium Units and Lodge Alley Commercial Condominium Units set forth in Schedule 6 hereto and each such Residential Condominium Unit is subject to a timeshare regimen pursuant to which fifty-two (52) fee timeshare intervals have been created in each such Residential Condominium Unit, all as provided for in the Lodge Alley Inn Master Deed. Borrower holds good and marketable title to each of the Lodge Alley Residential Condominium Units, Lodge Alley Commercial Condominium Units and Lodge Alley Intervals in Phase I, and such Residential Condominium Units, Commercial Condominium Units and Intervals are not encumbered by, or subject to, a lien, security interest, mortgage, deed of trust, installment contract, agreement for deed, option agreement, lease or other similar instrument except for the Lodge Alley Permitted Exceptions. 3.19 CONSTRUCTION OF THE BUILDINGS. The Borrower has obtained permanent, unconditional certificates of occupancy (or their equivalent) for the Lodge Alley Residential Condominium Units and the Lodge Alley Commercial Condominium Units in Phase I, and such certificates of occupancy (or their equivalent) remain in full force and effect. 10

3.20 PURCHASE DOCUMENTS. Borrower has furnished Lender with a true and complete copy of all documents relating to the acquisition of the Lodge Alley Resort. The Borrower has no obligations existing thereunder. 3.21 LODGE ALLEY RESORT DOCUMENTS. Borrower has furnished to the Lender true and correct copies of all Lodge Alley Resort Documents in respect of Phase I and all filings and/or recordations in order to establish the condominium and the timeshare ownership regimens in respect of Phase I of the Lodge Alley Resort have been done and all applicable laws and statutes in connection therewith have been complied with. Borrower has furnished to the Lender true and correct copies of the Lodge Alley Master Deed and all documents related thereto. Borrower has furnished to the Lender true and correct copies of the Lodge Alley Courtyard Restrictive Covenants and all documents related thereto. The Borrower is in control of the Lodge Alley Inn Association, the Lodge Alley Association and the Lodge Alley Courtyard Association. 3.22 SALE OF LODGE ALLEY INTERVALS . The sale and offering of sale of Lodge Alley Intervals in Phase I (together with any Owner Beneficiary Rights in and to the Club) (i) do not and will not constitute the sale, or the offering of sale, of Securities subject to the registration requirements of the Securities Act of 1933, as amended, or the blue-sky securities laws of South Carolina, (ii) are done and will only be done in South Carolina or such

3.20 PURCHASE DOCUMENTS. Borrower has furnished Lender with a true and complete copy of all documents relating to the acquisition of the Lodge Alley Resort. The Borrower has no obligations existing thereunder. 3.21 LODGE ALLEY RESORT DOCUMENTS. Borrower has furnished to the Lender true and correct copies of all Lodge Alley Resort Documents in respect of Phase I and all filings and/or recordations in order to establish the condominium and the timeshare ownership regimens in respect of Phase I of the Lodge Alley Resort have been done and all applicable laws and statutes in connection therewith have been complied with. Borrower has furnished to the Lender true and correct copies of the Lodge Alley Master Deed and all documents related thereto. Borrower has furnished to the Lender true and correct copies of the Lodge Alley Courtyard Restrictive Covenants and all documents related thereto. The Borrower is in control of the Lodge Alley Inn Association, the Lodge Alley Association and the Lodge Alley Courtyard Association. 3.22 SALE OF LODGE ALLEY INTERVALS . The sale and offering of sale of Lodge Alley Intervals in Phase I (together with any Owner Beneficiary Rights in and to the Club) (i) do not and will not constitute the sale, or the offering of sale, of Securities subject to the registration requirements of the Securities Act of 1933, as amended, or the blue-sky securities laws of South Carolina, (ii) are done and will only be done in South Carolina or such other states where any solicitation and/or sale thereof would not be in violation of applicable law, (iii) do not violate and will not violate any applicable federal, state or local consumer credit or sale rescission statute, including, without limitation, any such statute of any State in which a Purchaser may reside, (iv) do not violate and will not violate any other applicable federal, state or local law, statute or regulation and (v) do not violate any conservation easement or agreement listed in the Lodge Alley Permitted Exceptions. ARTICLE 4 - COVENANTS AND AGREEMENTS OF BORROWER So long as any portion of the Lodge Alley Loan remains unpaid, Borrower hereby covenants and agrees with Lender as follows: 4.1 RELEASE PAYMENTS. At the time of the sale of any Lodge Alley Interval and/or any Lodge Alley Commercial Condominium Unit, Borrower shall pay Lender the applicable Lodge Alley Release Payment, which payment shall be applied under the Lodge Alley Loan as follows: (a) first, to any unpaid Costs and expenses owing to Lender hereunder or under any other Lodge Alley Loan Document, (b) second, to all accrued and unpaid interest in respect of the Lodge Alley Loan then due and payable, (c) third, to any other accrued and unpaid interest in respect of the Lodge Alley Loan, (d) fourth, to outstanding principal balance of the Lodge Alley Loan, (e) fifth, to any other Indebtedness or obligations then outstanding and secured by the Lodge Alley Collateral hereunder and (f) lastly, to the Borrower. Borrower agrees only to sell Lodge Alley Intervals and not to sell Lodge Alley Residential Condominium Units as "whole" condominium units. 11

4.2 MANDATORY PREPAYMENTS. If the outstanding principal balance of the Lodge Alley Loan shall exceed the amount set forth below on the date corresponding to such amount as set forth below, then Borrower shall prepay to the Lender the amount of such excess not later than five (5) Business Days after such date and the same shall be applied to the then outstanding principal amount of the Lodge Alley Loan.
------------------------------------- --------------------------------------DATE MAXIMUM OUTSTANDING AMOUNT OF LODGE ALLEY LOAN ------------------------------------- --------------------------------------December 1, 1999 $13,395,672 ------------------------------------- --------------------------------------March 1, 2000 $12,640,478 ------------------------------------- --------------------------------------June 1, 2000 $12,304,836 ------------------------------------- --------------------------------------September 1, 2000 $11,927,239 ------------------------------------- --------------------------------------December 1, 2000 $11,269,142 ------------------------------------- --------------------------------------March 1, 2001 $10,479,425

4.2 MANDATORY PREPAYMENTS. If the outstanding principal balance of the Lodge Alley Loan shall exceed the amount set forth below on the date corresponding to such amount as set forth below, then Borrower shall prepay to the Lender the amount of such excess not later than five (5) Business Days after such date and the same shall be applied to the then outstanding principal amount of the Lodge Alley Loan.
------------------------------------- --------------------------------------DATE MAXIMUM OUTSTANDING AMOUNT OF LODGE ALLEY LOAN ------------------------------------- --------------------------------------December 1, 1999 $13,395,672 ------------------------------------- --------------------------------------March 1, 2000 $12,640,478 ------------------------------------- --------------------------------------June 1, 2000 $12,304,836 ------------------------------------- --------------------------------------September 1, 2000 $11,927,239 ------------------------------------- --------------------------------------December 1, 2000 $11,269,142 ------------------------------------- --------------------------------------March 1, 2001 $10,479,425 ------------------------------------- --------------------------------------June 1, 2001 $10,128,440 ------------------------------------- --------------------------------------September 1, 2001 $9,733,582 ------------------------------------- --------------------------------------December 1, 2001 $9,044,018 ------------------------------------- --------------------------------------March 1, 2002 $8,216,542 ------------------------------------- --------------------------------------June 1, 2002 $7,848,775 ------------------------------------- --------------------------------------September 1, 2002 $7,435,037 ------------------------------------- --------------------------------------December 1, 2002 $6,711,310 ------------------------------------- --------------------------------------March 1, 2003 $5,842,837 ------------------------------------- --------------------------------------June 1, 2003 $5,456,849 ------------------------------------- --------------------------------------September 1, 2003 $5,022,613 ------------------------------------- --------------------------------------December 1, 2003 4,262,924 ------------------------------------- --------------------------------------March 1, 2004 3,351,297 ------------------------------------- --------------------------------------June 1, 2004 2,946,130 ------------------------------------- --------------------------------------September 1, 2004 2,490,317 ------------------------------------- --------------------------------------December 1, 2004 1,743,215 ------------------------------------- --------------------------------------March 1, 2005 846,692 ------------------------------------- --------------------------------------June 1, 2005 448,237 ------------------------------------- --------------------------------------September 1, 2005 0 ------------------------------------- ---------------------------------------

12

4.3 COMPLIANCE WITH GOVERNMENTAL REQUIREMENTS, NOTICE OF GOVERNMENTAL AUTHORITY. Borrower shall timely comply with all Governmental Requirements applicable to the Borrower, Phase I and the Lodge Alley Resort, including, without limitation, maintaining an adequate number of parking spaces and complying with all zoning requirements. Borrower shall timely comply with and promptly furnish to Lender true and complete copies of any notice or claim by any governmental entity pertaining to the Lodge Alley Resort.

4.3 COMPLIANCE WITH GOVERNMENTAL REQUIREMENTS, NOTICE OF GOVERNMENTAL AUTHORITY. Borrower shall timely comply with all Governmental Requirements applicable to the Borrower, Phase I and the Lodge Alley Resort, including, without limitation, maintaining an adequate number of parking spaces and complying with all zoning requirements. Borrower shall timely comply with and promptly furnish to Lender true and complete copies of any notice or claim by any governmental entity pertaining to the Lodge Alley Resort. 4.4 CORRECTION OF DEFECTS. Borrower shall correct or cause to be corrected (a) any material defect in the Knapp building, the Griffith building or elsewhere in the Lodge Alley Resort, (b) any material adverse departure in the renovation of the Lodge Alley Resort from the plans and specifications therefor, as delivered to the Lender, (c) any violation of any Governmental Requirements, or any violation of any covenants, conditions and restrictions affecting the Lodge Alley Resort, if applicable, and (d) any encroachment by any part of the buildings on any easement, property line, or restricted area, or any encroachment by any such structure on any building setback line except for Lodge Alley Permitted Exceptions. Borrower shall defend, indemnify and save Lender harmless from all claims, losses, costs, damages and expenses asserted or proven against Lender by any Person as a result of the presence of any such defects, materials, substances or pests and any removal or compliance with applicable laws (including, without limitation, Environmental Laws), regardless of whether such claims, costs, losses, damages and expenses are actual or contingent, currently existing or arising in the future. The foregoing indemnification shall survive the payment in full of the Lodge Alley Loan and all other indebtedness secured by the Lodge Alley Mortgage and the other Lodge Alley Loan Documents and the release of the Lodge Alley Mortgage and the other Lodge Alley Loan Documents as to events occurring and causes of action arising before such payment and release. Without limiting the scope of this Section 4.4 and in addition to the foregoing, Borrower agrees to cause the eradication of any termites or similar pests currently located in the Inn building within 60 days of the date hereof; if Borrower shall fail to do so within said 60 day period, Lender may declare an immediate Event of Default hereunder and/or do whatever is necessary to eliminate said pests, and the costs thereof shall be added to the Lodge Alley Loan and shall be secured by the Lodge Alley Collateral. Without limiting the scope of this Section 4.4 and in addition to the foregoing, Borrower agrees to, contemporaneously with the closing of the Lodge Alley Loan or as soon as practicable thereafter (and in any case no later than 60 days from the date hereof), submit to Lender, at the sole cost of Borrower, a written operations and management plan outlining the nature and extent of the presence of asbestos, if any, at the Lodge Alley Resort, whether such asbestos is friable or otherwise creating or likely to create indoor air or other conditions that are in violation of applicable laws and the management options that Borrower intends to use in dealing with such asbestos and such conditions, the cost of such options and the projected timelines for the implementation of the same. 4.5 RECORDS. Borrower shall keep adequate records and books of account reflecting all financial transactions of Borrower and the Lodge Alley Inn Association and the Lodge Alley Association, in which complete entries will be made in accordance with GAAP. 4.6 MANAGEMENT. Borrower agrees that the manager and management contract in respect of the Lodge Alley Resort shall at all times be satisfactory to Lender and the Borrower 13

shall not agree to any amendments or changes in respect thereof without the prior written consent of Lender. 4.7 INSPECTION OF THE RESORT AND BOOKS AND RECORDS. Borrower shall, at such reasonable times during normal business hours and as often as may be reasonably requested, permit any agents or representatives of Lender to inspect any portion of the Lodge Alley Resort and any assets (including financial and accounting books and records) of Borrower, to examine and make copies of and abstracts from the records and books of account of any of such Persons and to discuss their affairs, finances and accounts with any of their respective officers, employees or independent public accountants. Borrower acknowledges that Lender intends to conduct such audits and inspections on at least an annual basis. All audits and property inspections shall be at the expense of Borrower; PROVIDED, HOWEVER, that except with respect to any audits and inspections conducted after an Event of Default hereunder, Borrower shall not be required to pay in the aggregate hereunder, under the Master Agreement and any Resort Documents thereunder or under the Warehouse Facility in excess of Ten Thousand Dollars ($10,000) in any calendar year for inspections and audits performed during such year.

shall not agree to any amendments or changes in respect thereof without the prior written consent of Lender. 4.7 INSPECTION OF THE RESORT AND BOOKS AND RECORDS. Borrower shall, at such reasonable times during normal business hours and as often as may be reasonably requested, permit any agents or representatives of Lender to inspect any portion of the Lodge Alley Resort and any assets (including financial and accounting books and records) of Borrower, to examine and make copies of and abstracts from the records and books of account of any of such Persons and to discuss their affairs, finances and accounts with any of their respective officers, employees or independent public accountants. Borrower acknowledges that Lender intends to conduct such audits and inspections on at least an annual basis. All audits and property inspections shall be at the expense of Borrower; PROVIDED, HOWEVER, that except with respect to any audits and inspections conducted after an Event of Default hereunder, Borrower shall not be required to pay in the aggregate hereunder, under the Master Agreement and any Resort Documents thereunder or under the Warehouse Facility in excess of Ten Thousand Dollars ($10,000) in any calendar year for inspections and audits performed during such year. 4.8 CASUALTY, CONDEMNATION. Borrower shall promptly notify Lender of any fire or other casualty or any notice of taking or eminent domain action or proceeding affecting the Lodge Alley Resort, or the threat of any such action or proceeding of which Borrower becomes aware. Provided no Event of Default then exists and Borrower certifies as to same, the net insurance proceeds shall be paid to Lender but shall be made available by Lender for the restoration or repair of the Lodge Alley Resort if: (i) in Lender's reasonable judgment (a) restoration or repair and the continued operation of the Lodge Alley Resort is economically feasible, and (b) the value of Lender's security is not reduced; (ii) the cost of restoration or repair does not exceed the net insurance proceeds or Borrower; (iii) the loss does not occur in the six (6) month period preceding the Lodge Alley Loan Maturity Date; (iv) Borrower has sufficient business interruption insurance to provide alternative accommodations for all owners or users of Lodge Alley Intervals affected by such casualty loss; and (v) Lender's architect/engineers certify that the restoration of the Lodge Alley Resort can be completed at least ninety (90) days prior to the Lodge Alley Loan Maturity Date. Borrower shall pay all amounts, in addition to the net insurance proceeds, necessary to pay in full the cost of the restoration or repair. Notwithstanding the foregoing, it shall be a condition precedent to any disbursement of insurance proceeds held by Lender hereunder that Lender (or, in Lender's discretion, an architect, engineer or other construction expert acceptable to Lender) shall have approved (x) all plans and specifications for any proposed repair or restoration; (y) the construction schedule; and (z) the architect's and general contractor's contracts for restoration; all costs of any architect, engineer or construction expert retained by Lender shall be for the account of Borrower and, upon demand by Lender, shall be promptly paid by Borrower. Lender may establish other conditions it deems reasonably necessary to assure the work is fully completed in a good and workmanlike manner free of all liens or claims by reason thereof, and in compliance with all applicable laws, rules and regulations. At Lender's option, the net insurance proceeds shall be disbursed pursuant to a construction escrow acceptable to Lender. If an Event of Default then exists, or any of the conditions set forth in this subsection have not been met or satisfied, the net insurance proceeds 14

(after deduction of Lender's reasonable costs and expenses, if any, in collecting same) shall be applied to the Lodge Alley Loan in such order and manner as Lender may elect, whether or not due and payable, with any excess paid to Borrower. The proceeds of any award, payment or claim for damages, direct or consequential, in connection with any condemnation or other taking of any portion or all of the Lodge Alley Resort, or for conveyances in lieu of condemnation, are hereby assigned to and shall be paid to Lender. Lender is authorized (but is under no obligation) to collect any such proceeds. The proceeds of any such award shall be made available by Lender for repair or restorations of the Property in the same manner and upon the same conditions as those set forth above for net insurance proceeds. Anything to the contrary herein notwithstanding, for so long as any part of the Lodge Alley Resort is subject to the Lodge Alley Resort Documents, the Lodge Alley Master Deed or the Lodge Alley Courtyard Restrictive Covenants

(after deduction of Lender's reasonable costs and expenses, if any, in collecting same) shall be applied to the Lodge Alley Loan in such order and manner as Lender may elect, whether or not due and payable, with any excess paid to Borrower. The proceeds of any award, payment or claim for damages, direct or consequential, in connection with any condemnation or other taking of any portion or all of the Lodge Alley Resort, or for conveyances in lieu of condemnation, are hereby assigned to and shall be paid to Lender. Lender is authorized (but is under no obligation) to collect any such proceeds. The proceeds of any such award shall be made available by Lender for repair or restorations of the Property in the same manner and upon the same conditions as those set forth above for net insurance proceeds. Anything to the contrary herein notwithstanding, for so long as any part of the Lodge Alley Resort is subject to the Lodge Alley Resort Documents, the Lodge Alley Master Deed or the Lodge Alley Courtyard Restrictive Covenants (1) any and all insurance proceeds arising from any damage or destruction to the Lodge Alley Resort subject to such documents, such Deed or such Covenants and any and all awards and payments with respect to condemnation or conveyances in lieu thereof received by Lender shall be applied and used in accordance with the provisions of such Documents, Deed or Covenants and (2) the obligations of Borrower under this Section 4.5 and the rights of Lender under this Section 4.5 shall be subject to the rights and obligations of the Lodge Alley Inn Association under the Lodge Alley Resort Documents, the Lodge Alley Association under the Lodge Alley Master Deed, the Lodge Alley Courtyard Association under the Lodge Alley Courtyard Restrictive Covenants and applicable South Carolina law, as the case may be. 4.9 APPLICATION OF LOAN PROCEEDS. Borrower shall apply the proceeds of the Lodge Alley Loan for reimbursement of up to 85% of the purchase price of the Lodge Alley Resort and Phase 1, as set forth on Schedule 1 hereto. 4.10 ADDITIONAL DOCUMENTS. Borrower shall execute and deliver to Lender, from time to time as requested by Lender, such other documents as shall reasonably be necessary to provide the rights and remedies to Lender granted or provided for by the Lodge Alley Loan Documents. 4.11 DEFENSE OF ACTIONS. Lender may (but shall not be obligated to) commence, appear, in, or defend any action or proceeding purporting to affect the Lodge Alley Loan, the Lodge Alley Resort, or the respective rights and obligations of Lender and Borrower pursuant to this Agreement. Lender may (but shall not be obligated to) pay all reasonable necessary expenses, including reasonable attorneys' fees and expenses incurred in connection with such proceedings or action, which Borrower agrees to repay to Lender on demand. 4.12 PAYMENT OF CHARGES. Borrower shall promptly pay or cause to be paid when due all costs and expenses incurred in connection with the Lodge Alley Resort, and Borrower shall keep the Property free and clear of any lien, tax, judgment, charge, assessment or claim (the "CHARGES") other than the encumbrances of the Lodge Alley Mortgage, the Lodge Alley Permitted Exceptions, and other liens approved in writing by Lender. Notwithstanding anything to the contrary contained in this Agreement, Borrower may (a) discharge in accordance with 15

applicable law any such Charge or contest the validity or amount of any claim of any contractor, consultant, architect, or other Person providing labor, materials, or services with respect to the Property, (b) contest any tax or special assessments levied by any governmental entity, and (c) contest the enforcement of or compliance with any Governmental Requirements. Any such contest on the part of Borrower shall not be an Event of Default hereunder provided that (i) during the pendency of any such contest Borrower shall, if requested by Lender, furnish to Lender and Title Company an indemnity bond from a corporate surety satisfactory to Lender and Title Company in an amount equal to one hundred fifty percent (150%) of the amount being contested or other security reasonably acceptable to them; and (ii) Borrower shall pay any amount adjudged by a court of competent jurisdiction (including appellate courts) to be due, with all costs, interest, and penalties thereon, before such judgment becomes a lien on the Lodge Alley Resort or any part thereof; and (iii) Borrower fulfills all of its obligations under this Agreement during the pendency of any such contest.

applicable law any such Charge or contest the validity or amount of any claim of any contractor, consultant, architect, or other Person providing labor, materials, or services with respect to the Property, (b) contest any tax or special assessments levied by any governmental entity, and (c) contest the enforcement of or compliance with any Governmental Requirements. Any such contest on the part of Borrower shall not be an Event of Default hereunder provided that (i) during the pendency of any such contest Borrower shall, if requested by Lender, furnish to Lender and Title Company an indemnity bond from a corporate surety satisfactory to Lender and Title Company in an amount equal to one hundred fifty percent (150%) of the amount being contested or other security reasonably acceptable to them; and (ii) Borrower shall pay any amount adjudged by a court of competent jurisdiction (including appellate courts) to be due, with all costs, interest, and penalties thereon, before such judgment becomes a lien on the Lodge Alley Resort or any part thereof; and (iii) Borrower fulfills all of its obligations under this Agreement during the pendency of any such contest. 4.13 RESERVE STUDY. Borrower agrees to complete a reserve study in respect of the Lodge Alley Inn Association and the Lodge Alley Resort and to submit the same to Lender on or prior to the second anniversary of the date hereof. Such reserve study shall be satisfactory to Lender in its reasonable discretion. 4.14 CURRENT FINANCIAL REPORTS. So long as any portion of the Loan remains outstanding, Borrower shall furnish the following to Lender: (a) MONTHLY SALES ACTIVITY REPORTS. Within fifteen (15) days after the end of each month, a summary of sales activity at the Lodge Alley Resort for such month, in form, content and detail acceptable to Lender in Lender's sole discretion. (b) QUARTERLY FINANCIAL REPORTS. Within forty-five (45) days after the end of each fiscal quarterly period, unaudited financial statements of each of the Borrower and the Guarantor, certified by the chief financial officer of each such Person to be true and correct. (a) YEAR-END FINANCIAL REPORTS. As soon as available and in any event within one hundred and twenty (120) days after the end of each fiscal year of each of the Guarantor and Borrower: (i) the consolidated and consolidating balance sheets of the Guarantor and its consolidated subsidiaries and the balance sheet of the Borrower as of the end of such year and the related consolidated and consolidating statements of income and cash flow for such fiscal year for the Guarantor and its consolidated subsidiaries and the related statements of income and cash flow for such fiscal year for Borrower; (ii) a schedule of all outstanding indebtedness of the Guarantor and the Borrower describing in reasonable detail each such debt or loan outstanding and the principal amount and amount of accrued and unpaid interest with respect to each such debt or loan; (iii) in the case of the Guarantor, copies of reports and any management letters from a firm of independent certified public accountants, selected by the Guarantor, which reports shall be unqualified as to going concern and scope of audit and shall state that such financial statements present fairly the financial position of the Guarantor and its consolidated subsidiaries, as of the dates indicated and the results of the Guarantor's operations and cash flow for the periods 16

indicated in conformity with GAAP; and (iv) in the case of the Borrower, a certificate from the chief financial officer of the Borrower certifying that such financial statements present fairly the financial position of the Borrower, as of the dates indicated and the results of the Borrower's operations and cash flow for the periods indicated in conformity with GAAP; (d) AUDIT REPORTS. Promptly upon receipt thereof, one (1) copy of each other report or management letter submitted to the Guarantor or the Borrower by independent public accountants in connection with any annual, interim or special audit made by them of the books of the Guarantor and/or the Borrower. (e) OTHER REPORTS. Such other reports, statements, notices or written communications relating to the Guarantor and/or the Borrower, as Lender may require, in its reasonable discretion. (f) SEC REPORTS. Promptly upon their becoming available one (1) copy of each financial statement, report, notice or proxy statement sent by the Guarantor to security holders generally, and of each regular or periodic report and any registration statement, prospectus or written communication (other than transmittal letters) in

indicated in conformity with GAAP; and (iv) in the case of the Borrower, a certificate from the chief financial officer of the Borrower certifying that such financial statements present fairly the financial position of the Borrower, as of the dates indicated and the results of the Borrower's operations and cash flow for the periods indicated in conformity with GAAP; (d) AUDIT REPORTS. Promptly upon receipt thereof, one (1) copy of each other report or management letter submitted to the Guarantor or the Borrower by independent public accountants in connection with any annual, interim or special audit made by them of the books of the Guarantor and/or the Borrower. (e) OTHER REPORTS. Such other reports, statements, notices or written communications relating to the Guarantor and/or the Borrower, as Lender may require, in its reasonable discretion. (f) SEC REPORTS. Promptly upon their becoming available one (1) copy of each financial statement, report, notice or proxy statement sent by the Guarantor to security holders generally, and of each regular or periodic report and any registration statement, prospectus or written communication (other than transmittal letters) in respect thereof filed by the Guarantor with, or received by the Guarantor in connection therewith from, any securities exchange or the Securities and Exchange Commission or any successor agency. (g) TAX RECEIPTS. To the extent reasonably requested by the Lender, the Borrower, for so long as it shall be in control of the Lodge Alley Resort, shall furnish Lender with copies of receipts or tax statements marked "Paid" to evidence the payment of all taxes levied on or in respect of each such Resort prior to the date such taxes become delinquent. (h) NOTICE OF LITIGATION, CLAIMS, AND FINANCIAL CHANGE. Notice of (i) any litigation against the Guarantor or the Borrower or affecting the Lodge Alley Resort, which, if determined adversely, might have a material adverse effect upon the financial condition of the Guarantor or the Borrower or upon the Lodge Alley Resort, (ii) any claim or controversy which might become the subject of such litigation, and (iii) any material adverse change in the financial condition of the Guarantor or the Borrower. (i) SEMI-ANNUAL RESORT ASSOCIATION REPORTS. If reasonably requested by Lender, as soon as available and in any event within ninety (90) days after the end of each semiannual fiscal period of the Lodge Alley Inn Association and the Lodge Alley Association: (I) the balance sheet of each such Association as of the end of such semiannual period and the related statement of income and cash flow for such semiannual period, prepared in accordance with GAAP and subject to normal year-end adjustments; and (II) a schedule of all outstanding indebtedness of each such Association describing in reasonable detail each such debt or loan outstanding and the principal amount and amount of accrued and unpaid interest with respect to each such debt or loan. (j) YEAR-END RESORT ASSOCIATION REPORTS. As soon as available and in any event within one hundred and twenty (120) days after the end of each fiscal year of the Lodge 17

Alley Inn Association and the Lodge Alley Association: (I) the balance sheet of each such Association as of the end of such year and the related statement of income and cash flow for such fiscal year; (II) a schedule of all outstanding indebtedness of each such Association describing in reasonable detail each such debt or loan outstanding and the principal amount and amount of accrued and unpaid interest with respect to each such debt or loan; and (III) copies of reports from a firm of independent certified public accountants, which report shall be unqualified as to going concern and scope of audit and shall state that such financial statements present fairly the financial position of each such Association as of the dates indicated and the results of its operations and cash flow for the periods indicated in conformity with GAAP. 4.15 INSURANCE POLICIES. Borrower shall obtain or cause to be obtained the Insurance Policies and shall keep the Insurance Policies, or shall cause the Insurance Policies to be kept, in full force and effect at all times while the Lodge Alley Loan is outstanding. Borrower shall, in connection with any renewal of the Insurance Policies, submit, or use commercially reasonable efforts to cause the Lodge Alley Inn Association and/or the Lodge Alley Association to submit, to the Lender insurance certificates showing the type and amounts of such

Alley Inn Association and the Lodge Alley Association: (I) the balance sheet of each such Association as of the end of such year and the related statement of income and cash flow for such fiscal year; (II) a schedule of all outstanding indebtedness of each such Association describing in reasonable detail each such debt or loan outstanding and the principal amount and amount of accrued and unpaid interest with respect to each such debt or loan; and (III) copies of reports from a firm of independent certified public accountants, which report shall be unqualified as to going concern and scope of audit and shall state that such financial statements present fairly the financial position of each such Association as of the dates indicated and the results of its operations and cash flow for the periods indicated in conformity with GAAP. 4.15 INSURANCE POLICIES. Borrower shall obtain or cause to be obtained the Insurance Policies and shall keep the Insurance Policies, or shall cause the Insurance Policies to be kept, in full force and effect at all times while the Lodge Alley Loan is outstanding. Borrower shall, in connection with any renewal of the Insurance Policies, submit, or use commercially reasonable efforts to cause the Lodge Alley Inn Association and/or the Lodge Alley Association to submit, to the Lender insurance certificates showing the type and amounts of such Insurance Policies and the payment of premiums in respect thereof. Borrower shall give prompt written notice to Lender of any changes in the coverage of any of the Insurance Policies. 4.16 BORROWER'S FINANCIAL MAINTENANCE REQUIREMENT. Borrower agrees to pay the Lodge Alley Inn Association all dues and other moneys owing to it under the Lodge Alley Resort Documents and any other obligation of the Borrower to pay dues and assessments or make whole any shortfall in the same. 4.17 HOLD HARMLESS. Borrower shall indemnify Lender and hold Lender harmless from and against any and all liabilities, indebtedness, losses, damages, penalties, actions, judgments, suits, claims, costs, expenses, and disbursements of any kind or nature whatsoever which may be imposed on, incurred by or asserted against Lender, in any way relating to or arising out of (a) this Agreement and/or the Lodge Alley Loan Documents and/or (b) any of the transactions contemplated therein or thereby (including those in any way relating to or arising out of the violation by Borrower of any federal or state laws) other than liabilities, indebtedness, losses, damages, penalties, actions, judgments, suits, claims, costs, expenses and disbursements which are caused by the Lender's material breach of, or gross negligence or willful misconduct with respect to, its actions or inactions under this Agreement and the other Lodge Alley Loan Documents. Upon receiving knowledge of any suit, claim or demand asserted by a third party that Lender believes is covered by this indemnity, and subject to the condition that no Event of Default under this Agreement shall then exist, Lender shall give Borrower notice of the matter and an opportunity to defend it, at Borrower's sole cost and expense, with legal counsel satisfactory to Lender. Notwithstanding any defense by Borrower of any such suit, claim or demand, Lender shall have the right to participate in any material decision affecting the conduct or settlement of any dispute or proceeding for which indemnification may be claimed. The provisions of this Section shall survive the payment in full of the Lodge Alley Loan and all other indebtedness secured by the Lodge Alley Mortgage and the other Lodge Alley Loan Documents 18

and the release of the Lodge Alley Mortgage and the other Lodge Alley Loan Documents as to events occurring and causes of action arising before such payment and release. 4.18 CROSS DEFAULT, CROSS COLLATERALIZATION. The documents and instruments evidencing and securing the Lodge Alley Loan shall also secure each of the other Resort Loans, under and as defined in the Master Agreement, and the obligations of the Guarantor and the Borrower under the Warehouse Facility. Any event of default under any of such Resort Loans or under the Warehouse Facility shall be an Event of Default hereunder. 4.19 NET WORTH; COVERAGE RATIO; LEVERAGE RATIO. Borrower covenants that on and after the date hereof and so long as the Lodge Alley Loan shall be outstanding or there are any outstanding obligations of Guarantor under the Lodge Alley Guarantee, Borrower and Guarantor will comply with the covenants set forth in Sections 5.7, 5.8 and 5.9 of the Warehouse Facility (as in effect on the date hereof and notwithstanding any termination or expiration of said Warehouse Facility after the date hereof), and such covenants and the definitions used therein are hereby incorporated herein in their entirety as if set forth at length herein.

and the release of the Lodge Alley Mortgage and the other Lodge Alley Loan Documents as to events occurring and causes of action arising before such payment and release. 4.18 CROSS DEFAULT, CROSS COLLATERALIZATION. The documents and instruments evidencing and securing the Lodge Alley Loan shall also secure each of the other Resort Loans, under and as defined in the Master Agreement, and the obligations of the Guarantor and the Borrower under the Warehouse Facility. Any event of default under any of such Resort Loans or under the Warehouse Facility shall be an Event of Default hereunder. 4.19 NET WORTH; COVERAGE RATIO; LEVERAGE RATIO. Borrower covenants that on and after the date hereof and so long as the Lodge Alley Loan shall be outstanding or there are any outstanding obligations of Guarantor under the Lodge Alley Guarantee, Borrower and Guarantor will comply with the covenants set forth in Sections 5.7, 5.8 and 5.9 of the Warehouse Facility (as in effect on the date hereof and notwithstanding any termination or expiration of said Warehouse Facility after the date hereof), and such covenants and the definitions used therein are hereby incorporated herein in their entirety as if set forth at length herein. 4.20 SUBORDINATED OBLIGATIONS. Borrower will not, directly or indirectly, (A) permit any payment to be made in respect of any indebtedness, liabilities or obligations, direct or contingent, to any Affiliates (excluding trade payables incurred in the ordinary course of business), or (B) permit the amendment, rescission or other modification of any of such indebtedness, liabilities or obligations in such a manner as to affect adversely the lien priority of any of the Lodge Alley Collateral granted to Lender or to cause a Material Adverse Effect. 4.21 CONSOLIDATION AND MERGER. Borrower will not consolidate with or merge into any other Person or permit any other Person to consolidate with or merge into it unless (a) the Borrower shall be the continuing corporation or the successor corporation shall be a corporation organized under the laws of the United States of America or any State thereof and shall expressly assume the due and punctual payment of the Lodge Alley Loan and all Indebtedness in respect thereof and shall further assume the due and punctual performance and observance of all of the covenants and conditions of this Agreement, the other Lodge Alley Loan Documents and the Lodge Alley Resort Documents to be performed and observed by the Borrower, in each case, pursuant to an amendment hereto or other form of assumption agreement in form satisfactory to the Lender, in its sole discretion, and (b) the Borrower shall not be in default of any covenant, representation, warranty or condition hereunder or under any of the other Lodge Alley Loan Documents or any of the Lodge Alley Resort Documents either prior thereto or after giving effect to such assumption. 4.22 RESTRICTIONS ON TRANSFERS. Borrower shall not, without obtaining the prior written consent of Lender, which may be granted or withheld in Lender's sole discretion, (a) transfer, sell, pledge, convey, assign or encumber any interest in the Lodge Alley Resort, except for the sale of Lodge Alley Intervals or Lodge Alley Commercial Condominium Units to Purchasers or other third-party purchasers on an arm's-length basis, the sale of Owner Beneficiary Rights on an arm's-length basis and the encumbrance of the Lodge Alley Mortgage and the Lodge Alley Assignment of Leases and Rents in connection herewith; (b) permit any sale, assignment, 19

encumbrance, dilution or other disposition of any ownership interests in Borrower except to Guarantor; or (C) permit the creation of any new ownership interests in Borrower, except to the extent such new ownership interests are owned or controlled by the Guarantor. 4.23 RESTRICTIONS. Other than the Lodge Alley Permitted Exceptions or the Lodge Alley Resort Documents, Borrower shall not impose any covenants, easements or other encumbrances upon the Lodge Alley Resort or execute or file any subdivision plat affecting the Lodge Alley Resort without the prior written consent of Lender, which shall not be unreasonably withheld. 4.24 MODIFICATION OF RESORT DOCUMENTS. Without Lender's prior written consent, Borrower shall not amend, modify or terminate any of the Lodge Alley Resort Documents, the Lodge Alley Master Deed or the Lodge Alley Courtyard Restrictive Covenants or any other covenants, conditions, easements or restrictions affecting the Lodge Alley Resort (or any portion thereof) or relinquish any developer or declarant control that it currently possesses, except that if any amendment or modification is required either (A) to cause additional

encumbrance, dilution or other disposition of any ownership interests in Borrower except to Guarantor; or (C) permit the creation of any new ownership interests in Borrower, except to the extent such new ownership interests are owned or controlled by the Guarantor. 4.23 RESTRICTIONS. Other than the Lodge Alley Permitted Exceptions or the Lodge Alley Resort Documents, Borrower shall not impose any covenants, easements or other encumbrances upon the Lodge Alley Resort or execute or file any subdivision plat affecting the Lodge Alley Resort without the prior written consent of Lender, which shall not be unreasonably withheld. 4.24 MODIFICATION OF RESORT DOCUMENTS. Without Lender's prior written consent, Borrower shall not amend, modify or terminate any of the Lodge Alley Resort Documents, the Lodge Alley Master Deed or the Lodge Alley Courtyard Restrictive Covenants or any other covenants, conditions, easements or restrictions affecting the Lodge Alley Resort (or any portion thereof) or relinquish any developer or declarant control that it currently possesses, except that if any amendment or modification is required either (A) to cause additional phases to be annexed into the timeshare regimen of the Lodge Alley Resort Documents, as currently contemplated therein, (B) by law, Borrower shall implement the same. Borrower shall deliver to Lender copies of each such amendment or modification promptly, and in any case within ten (10) days, after the execution thereof or (C) to correct minor errors or to otherwise make ministerial additions or deletions, none of which (either individually or in the aggregate) would have a Material Adverse Effect. Without limiting the scope of the immediately preceding sentence, Borrower shall not materially amend, modify or assign to any Person any management, marketing, servicing, maintenance or other similar contract for or in respect of the Lodge Alley Resort except as provided for herein or in the other Lodge Alley Loan Documents. 4.25 RENOVATIONS. Borrower shall complete all renovations to the Lodge Alley Resort by the date set forth in such Schedule 7 hereto. 4.26 YEAR 2000. Borrower has made an assessment of the microchip and computer-based systems and the software used in its business and based upon such assessment believes that they will be "Year 2000 Compliant" by or before January 1, 2000, except where the failure to be so "Year 2000 Compliant" would not have a Material Adverse Effect. "Year 2000 Compliant" means that all software, embedded microchips and other processing capabilities utilized by, and material to the business operations or financial condition of, the Borrower are able to interpret, store, transmit, receive and manipulate data on and involving all calendar dates correctly and without causing any abnormal ending scenarios in relation to dates in and after the Year 2000. 4.27 ENVIRONMENTAL. Borrower will not, and will not permit any Person to, use, generate, treat, store or dispose of any Hazardous Materials in or on the Lodge Alley Resort except where the same is in compliance with all applicable Environmental Laws or would not have or produce a Material Adverse Effect. If the Lender, at any time, has a reasonable basis to believe that the Borrower or the Lodge Alley Resort may be in violation of any Environmental Law, then Borrower agrees, upon request from the Lender, to provide the Lender with such reports, certificates, engineering studies or other written materials or data as the Lender may 20

require, in its reasonable discretion, so as to satisfy the Lender that the Borrower and/or the Lodge Alley Resort are in compliance with all applicable Environmental Laws and that the marketability and value of the Lodge Alley Resort is adequately maintained. The Borrower's undertakings under this Section 4.27 are in addition to its undertakings under Section 4.4 hereof. 4.28 VOTING. Notwithstanding the terms of the By-Laws of the Lodge Alley Inn Association, the Lodge Alley Association and/or the Lodge Alley Courtyard Association, Borrower agrees not to vote in respect of any of the following without the prior written consent of the Lender: (a) in connection with any material casualty, taking or condemnation of the condominiums or common elements established by the Lodge Alley Inn Master Deed (or any part thereof), the Lodge Alley Master Deed (or any part thereof) or the Lodge Alley Courtyard Restrictive Covenants (or any part thereof), (b) pertaining to the amendment of the articles of incorporation or bylaws of the Lodge Alley Inn Condominium Association, the Lodge Alley Condominium Association and/or the Lodge Alley Courtyard Association, (c) pertaining to the amendment of the Lodge Alley Inn Master Deed, the Lodge Alley Master Deed and/or the Lodge Alley Courtyard Restrictive Covenants (other than as permitted under Section

require, in its reasonable discretion, so as to satisfy the Lender that the Borrower and/or the Lodge Alley Resort are in compliance with all applicable Environmental Laws and that the marketability and value of the Lodge Alley Resort is adequately maintained. The Borrower's undertakings under this Section 4.27 are in addition to its undertakings under Section 4.4 hereof. 4.28 VOTING. Notwithstanding the terms of the By-Laws of the Lodge Alley Inn Association, the Lodge Alley Association and/or the Lodge Alley Courtyard Association, Borrower agrees not to vote in respect of any of the following without the prior written consent of the Lender: (a) in connection with any material casualty, taking or condemnation of the condominiums or common elements established by the Lodge Alley Inn Master Deed (or any part thereof), the Lodge Alley Master Deed (or any part thereof) or the Lodge Alley Courtyard Restrictive Covenants (or any part thereof), (b) pertaining to the amendment of the articles of incorporation or bylaws of the Lodge Alley Inn Condominium Association, the Lodge Alley Condominium Association and/or the Lodge Alley Courtyard Association, (c) pertaining to the amendment of the Lodge Alley Inn Master Deed, the Lodge Alley Master Deed and/or the Lodge Alley Courtyard Restrictive Covenants (other than as permitted under Section 4.24 hereof) or (d) any other matter upon which a vote may be taken if an Event of Default shall have occurred and be continuing. In the case of the exercise of its rights and remedies in respect of the Lodge Alley Intervals, the Lodge Alley Residential Condominium Units and/or the Lodge Alley Commercial Condominium Units under the Lodge Alley Mortgage, the Borrower will, at the written request of Lender, obtain the resignations of each of the directors elected and/or appointed by the Borrower to the Board of Directors of each of Lodge Alley Inn Association, the Lodge Alley Association and/or the Lodge Alley Courtyard Association and will deliver them to Lender. ARTICLE 5 - DEFAULT An "Event of Default" shall exist if any of the following shall occur: 5.1 PAYMENTS. Any Indebtedness is not paid within five (5) business days of the date when due, whether by acceleration or otherwise. 5.2 FINANCIAL COVENANT DEFAULTS; OTHER DEFAULTS. Any failure by the Guarantor or the Borrower to comply with the financial covenants set forth in Section 4.19 hereof or the existence of any default or event of default under the Lodge Alley Mortgage or any other Lodge Alley Loan Document. 5.3 OTHER COVENANT DEFAULTS. Borrower shall fail to perform or observe any covenant, agreement or obligation contained in this Agreement or in any of the Lodge Alley Loan Documents (other than as contemplated in Sections 5.1 or 5.2 above), and such failure shall continue for thirty (30) days after Lender delivers written notice thereof to Borrower, PROVIDED, HOWEVER, if the failure is incapable of cure within such thirty (30) day period and Borrower shall be diligently pursuing a cure, such thirty (30) day cure period shall be extended by an additional period not to exceed sixty (60) days. 21

5.4 WARRANTIES OR REPRESENTATIONS. Any statement, representation or warranty in this Agreement, any of the other Lodge Alley Loan Documents, any financial statement or any other writing delivered by Guarantor or Borrower to Lender in connection with this Agreement is false, misleading or incorrect in any material respect as of the date made. 5.5 DEFAULT IN OTHER RESORT LOANS OR THE WAREHOUSE FACILITY OR OTHER INDEBTEDNESS. Any default by the Guarantor, the Borrower or any Affiliate in the payment of indebtedness for borrowed money in an aggregate principal amount in excess of $1,000,000 (including, without limitation, any default by the Guarantor, the Borrower or any Affiliate in the payment of indebtedness for borrowed money owing to Lender under the Warehouse Facility or any other agreement) after the expiration of any applicable grace or cure period; any other default under such indebtedness which accelerates or permits the acceleration (after the giving of notice or passage of time, or both) of the maturity of such indebtedness or any default under such indebtedness which permits the holders of such indebtedness to elect a majority of the Board of Directors of the Guarantor; or the occurrence and continuance of any default (after the expiration of any applicable grace or

5.4 WARRANTIES OR REPRESENTATIONS. Any statement, representation or warranty in this Agreement, any of the other Lodge Alley Loan Documents, any financial statement or any other writing delivered by Guarantor or Borrower to Lender in connection with this Agreement is false, misleading or incorrect in any material respect as of the date made. 5.5 DEFAULT IN OTHER RESORT LOANS OR THE WAREHOUSE FACILITY OR OTHER INDEBTEDNESS. Any default by the Guarantor, the Borrower or any Affiliate in the payment of indebtedness for borrowed money in an aggregate principal amount in excess of $1,000,000 (including, without limitation, any default by the Guarantor, the Borrower or any Affiliate in the payment of indebtedness for borrowed money owing to Lender under the Warehouse Facility or any other agreement) after the expiration of any applicable grace or cure period; any other default under such indebtedness which accelerates or permits the acceleration (after the giving of notice or passage of time, or both) of the maturity of such indebtedness or any default under such indebtedness which permits the holders of such indebtedness to elect a majority of the Board of Directors of the Guarantor; or the occurrence and continuance of any default (after the expiration of any applicable grace or cure period) or any event of default under any of the Resort Loan Documents, as defined in the Master Agreement. For the avoidance of doubt, a default or the occurrence and continuance of an Event of Termination under the Purchase Facility shall not constitute an Event of Termination under Section 6(e) of the Master Agreement. 5.6 PURCHASE FACILITY. Purchases of receivables under the Purchase Facility shall have been suspended, deferred or terminated or the Purchase Facility shall have been terminated, PROVIDED that this Section 5.6 shall not be deemed to have been activated if, but only if, (a) receivables cannot be purchased under the Purchase Facility by virtue of the maximum limitation on the amount of purchases set forth in the Purchase Facility having been reached, or because any Eligible Resort under the Master Agreement shall not have been approved by Lender as an "Additional Resort" under the Purchase Facility, or because Lender shall have reviewed and rejected receivables associated with the Club or (b) because the "seller" thereunder shall have voluntarily elected not to use the Purchase Facility or not to renew the "program" provided by the Purchase Facility on and after the date of its scheduled expiration. 5.7 JUDGEMENTS. The issuance, filing or levy against the Guarantor or the Borrower of one or more attachments, injunctions, executions, tax liens or judgments for the payment of money cumulatively in excess of $1,000,000, which is not discharged in full or stayed within thirty (30) days after issuance or filing. 5.8 BANKRUPTCY. Guarantor or Borrower: (a) does not pay its debts as they become due or admits in writing its inability to pay its debts or makes a general assignment for the benefit of creditors; or (b) commences any case, proceeding or other action seeking reorganization, arrangement, adjustment, liquidation, dissolution or composition of it or its debts under any Debtor Relief Laws; or 22

(c) in any involuntary case, proceeding or other action commenced against it which seeks to have an order for relief entered against it, as debtor, or seeks reorganization, arrangement, liquidation, dissolution or composition of it or its debts under any Debtor Relief Laws, (i) fails to obtain a dismissal of such case, proceeding or other action within sixty (60) days of its commencement, or (ii) converts the case from one chapter of the Federal Bankruptcy Code to another chapter, or (iii) is the subject of an order for relief; or (d) conceals, removes, or permits to be concealed or removed any part of its property, with intent to hinder, delay or defraud its creditors or any of them, or makes or suffers a transfer of any of its property which may be fraudulent under any bankruptcy, fraudulent conveyance or similar law; or makes any transfer of its property to or for the benefit of a creditor at a time when other creditors similarly situated have not been paid; or suffers or permits, while insolvent, any creditor to obtain a lien upon any of its property through legal proceedings which is not vacated within sixty (60) days from the date thereof; or (e) has a trustee, receiver, custodian or other similar official appointed for, or take possession of, all or any part

(c) in any involuntary case, proceeding or other action commenced against it which seeks to have an order for relief entered against it, as debtor, or seeks reorganization, arrangement, liquidation, dissolution or composition of it or its debts under any Debtor Relief Laws, (i) fails to obtain a dismissal of such case, proceeding or other action within sixty (60) days of its commencement, or (ii) converts the case from one chapter of the Federal Bankruptcy Code to another chapter, or (iii) is the subject of an order for relief; or (d) conceals, removes, or permits to be concealed or removed any part of its property, with intent to hinder, delay or defraud its creditors or any of them, or makes or suffers a transfer of any of its property which may be fraudulent under any bankruptcy, fraudulent conveyance or similar law; or makes any transfer of its property to or for the benefit of a creditor at a time when other creditors similarly situated have not been paid; or suffers or permits, while insolvent, any creditor to obtain a lien upon any of its property through legal proceedings which is not vacated within sixty (60) days from the date thereof; or (e) has a trustee, receiver, custodian or other similar official appointed for, or take possession of, all or any part of its property or has any court take jurisdiction of any other of its property which continues for a period of sixty (60) days; or (f) fails to have discharged within a period of thirty (30) days any attachment, sequestration, or similar writ levied upon any property of such owner. 5.9 GUARANTY. Failure by the Guarantor to comply with the terms of the Lodge Alley Guaranty or the Lodge Alley Completion Guaranty or any other document executed by the Guarantor in connection with the Lodge Alley Loan, after the expiration of any applicable notice and cure periods, or the Lodge Alley Guaranty or the Lodge Alley Completion Guaranty shall have been terminated, revoked or declared invalid. 5.10 STAY. The issuance of any stay order, cease and desist order or similar judicial or nonjudicial sanction limiting or otherwise affecting the sale of Lodge Alley Intervals or Lodge Alley Commercial Condominium Units and any such order or sanction shall have been outstanding for more than 60 days from the date of its entry and shall not have been discharged in full or stayed by appeal, bond or otherwise; or 5.11 ZONING AND LICENSES. The revocation of any license, parking rights or assignment, zoning authorizations, certificate or certificates of occupancy or other permits, approvals or authorizations granted by any applicable governmental entity which would have a Material Adverse Effect. 5.12 TERMINATION EVENT. The existence and continuance of a Termination Event under, and as defined in, the Master Agreement, PROVIDED that the Termination Event set forth in Section 6(f) of the Master Agreement shall be qualified to the same extent as set forth in Section 5.6 above . 23

ARTICLE 6 - RIGHTS AND REMEDIES OF LENDER 6.1 REMEDIES UPON DEFAULT. Upon the occurrence and during the continuance of an Event of Default, Lender may take any one or more of the following actions, all without notice to Borrower: (a) ACCELERATION. Declare the unpaid principal balance of the Lodge Alley Loan and all other Indebtedness, or any part thereof, immediately due and payable, whereupon the same shall be due and payable. (b) JUDGMENT. Reduce Lender's claim to judgment, foreclose or otherwise enforce Lender's security interest in all or any part of the Lodge Alley Collateral by any available judicial procedure. (c) SALE OF COLLATERAL. Exercise all the rights and remedies of a secured party on default under the Code (whether or not the Code applies to the affected Lodge Alley Collateral) including (I) require Borrower to, and Borrower hereby agrees that it will, at its expense and upon request of Lender forthwith, assemble all or part of the Lodge Alley Collateral as directed by Lender and make it available to Lender at a place to be designated by Lender which is reasonably convenient to both parties; (II) enter upon any premises of Borrower and take possession of the Lodge Alley Collateral; and (III) sell the Lodge Alley Collateral or any part thereof in one or

ARTICLE 6 - RIGHTS AND REMEDIES OF LENDER 6.1 REMEDIES UPON DEFAULT. Upon the occurrence and during the continuance of an Event of Default, Lender may take any one or more of the following actions, all without notice to Borrower: (a) ACCELERATION. Declare the unpaid principal balance of the Lodge Alley Loan and all other Indebtedness, or any part thereof, immediately due and payable, whereupon the same shall be due and payable. (b) JUDGMENT. Reduce Lender's claim to judgment, foreclose or otherwise enforce Lender's security interest in all or any part of the Lodge Alley Collateral by any available judicial procedure. (c) SALE OF COLLATERAL. Exercise all the rights and remedies of a secured party on default under the Code (whether or not the Code applies to the affected Lodge Alley Collateral) including (I) require Borrower to, and Borrower hereby agrees that it will, at its expense and upon request of Lender forthwith, assemble all or part of the Lodge Alley Collateral as directed by Lender and make it available to Lender at a place to be designated by Lender which is reasonably convenient to both parties; (II) enter upon any premises of Borrower and take possession of the Lodge Alley Collateral; and (III) sell the Lodge Alley Collateral or any part thereof in one or more parcels at public or private sale, at any of the Lender's offices or elsewhere, at such time or times, for cash, on credit or for future delivery, and at such price or prices and upon such other terms as Lender may deem commercially reasonable. Borrower agrees that, to the extent notice of sale shall be required by law, ten (10) days notice of the time and place of any sale shall constitute reasonable notification. At any sale of the Lodge Alley Collateral, if permitted by law, Lender may bid (which bid may be, in whole or in part, in the form of cancellation of indebtedness) for the purchase of the Lodge Alley Collateral or any portion thereof for the account of Lender. Borrower shall remain liable for any deficiency. Lender shall not be required to proceed against any Lodge Alley Collateral but may proceed against Borrower and/or the Guarantor directly. To the extent permitted by law, Borrower hereby specifically waives all rights of redemption, stay or appraisal which it has or may have under any law now existing or hereafter enacted. (d) RECEIVER. Apply by appropriate judicial proceedings for appointment of a receiver for the Lodge Alley Collateral, or any part thereof, and Borrower hereby consents to any such appointment. (e) OPERATION. Take possession of and operate the Lodge Alley Resort (including, without limitation, any part thereof operating as a hotel or transient lodging facility), collect all receivables and other revenues in respect thereof and do any and every act which Borrower might do on its own behalf, and Borrower hereby irrevocably appoints and constitutes Lender its lawful attorney-in-fact, with full power of substitution for the 24

purposes aforesaid, it being understood that the foregoing power of attorney shall be a power coupled with an interest and cannot be revoked. (f) ACCOUNTS RECEIVABLE. Lender may, in its sole discretion, communicate at any time and from time to time with any account debtor or other obligor in respect of any account, receivable or general intangible constituting a part of the Lodge Alley Collateral with regard to the lien of Lender thereon and any other matter relating thereto. Lender shall have the right to (i) require that all payments on all accounts, receivables and general intangibles constituting, in each case, a part of the Lodge Alley Collateral be paid directly to Lender or to such Person as Lender may designate and to receive, collect, hold and apply the same in accordance with this Agreement and the other Lodge Alley Loan Documents. Borrower hereby further irrevocably authorizes, directs and empowers Lender to collect and receive all checks and drafts evidencing such payments and to endorse such checks and drafts in the name of Borrower and upon such endorsement to collect and receive the money therefor. (g) EXERCISE OF OTHER RIGHTS. Exercise any and all other rights or remedies afforded by any applicable laws or by the Lodge Alley Loan Documents as Lender shall deem appropriate, at law, in equity or otherwise, including the right to bring suit or other proceeding, either for specific performance of any covenant or condition contained in the Lodge Alley Loan Documents or in aid of the exercise of any right or remedy granted to Lender in the Lodge Alley Loan Documents.

purposes aforesaid, it being understood that the foregoing power of attorney shall be a power coupled with an interest and cannot be revoked. (f) ACCOUNTS RECEIVABLE. Lender may, in its sole discretion, communicate at any time and from time to time with any account debtor or other obligor in respect of any account, receivable or general intangible constituting a part of the Lodge Alley Collateral with regard to the lien of Lender thereon and any other matter relating thereto. Lender shall have the right to (i) require that all payments on all accounts, receivables and general intangibles constituting, in each case, a part of the Lodge Alley Collateral be paid directly to Lender or to such Person as Lender may designate and to receive, collect, hold and apply the same in accordance with this Agreement and the other Lodge Alley Loan Documents. Borrower hereby further irrevocably authorizes, directs and empowers Lender to collect and receive all checks and drafts evidencing such payments and to endorse such checks and drafts in the name of Borrower and upon such endorsement to collect and receive the money therefor. (g) EXERCISE OF OTHER RIGHTS. Exercise any and all other rights or remedies afforded by any applicable laws or by the Lodge Alley Loan Documents as Lender shall deem appropriate, at law, in equity or otherwise, including the right to bring suit or other proceeding, either for specific performance of any covenant or condition contained in the Lodge Alley Loan Documents or in aid of the exercise of any right or remedy granted to Lender in the Lodge Alley Loan Documents. 6.2 OFFSETS; APPLICATION OF COLLATERAL. Upon the occurrence and during the continuance of an Event of Default, Lender may apply and offset against the Indebtedness (a) any and all of the Lodge Alley Collateral in its possession, any and all balances, credits, deposits, accounts, reserves, indebtedness or other moneys of Borrower (whether or not then due or owing to Borrower) held by Lender or any agent of Lender hereunder or under any other financing agreement or any Lodge Alley Loan Document or otherwise and (b) all other property at any time held or owing by the Lender to or for the account of the Borrower. 6.3 WAIVERS. No waiver by Lender of any Event of Default shall be deemed to be a waiver of any other or subsequent Event of Default. No delay or omission by Lender in exercising any right or remedy under the Lodge Alley Loan Documents shall impair such right or remedy or be construed as a waiver thereof or an acquiescence therein, nor shall any single or partial exercise of any such right or remedy preclude other or further exercise thereof, or the exercise of any other right or remedy under the Lodge Alley Loan Documents or otherwise. Further, Borrower and Guarantor each severally waive notice of the occurrence and continuance of any Event of Default, presentment and demand for payment, protest, and notice of protest, notice of intention to accelerate, acceleration and nonpayment, and agree that their respective liability shall not be affected by any renewal or extension in the time of payment of the Indebtedness, or by any release or change in any security for the payment or performance of the Indebtedness, regardless of the number of such renewals, extensions, releases or changes. Borrower also hereby waives the right to assert any statute of limitations as a bar to the enforcement of the lien created by any of the Lodge Alley Loan Documents or to any action 25

brought to enforce the Lodge Alley Note or any other obligation secured by the Lodge Alley Loan Documents. 6.4 CUMULATIVE RIGHTS. All rights and remedies available to Lender under the Lodge Alley Loan Documents shall be cumulative and in addition to all other rights and remedies granted to Lender at law or in equity, whether or not the Indebtedness is due and payable and whether or not Lender shall have instituted any suit for collection or other action in connection with the Lodge Alley Loan Documents. 6.5 MARSHALLING WAIVER. Borrower waives any and all rights to require the marshalling of assets in connection with the exercise of any of the remedies hereunder. 6.6 APPLICATION OF PROCEEDS. The proceeds of any exercise of rights with respect to the Lodge Alley Collateral or any part thereof shall be paid to and applied as follows: FIRST, to the payment of

brought to enforce the Lodge Alley Note or any other obligation secured by the Lodge Alley Loan Documents. 6.4 CUMULATIVE RIGHTS. All rights and remedies available to Lender under the Lodge Alley Loan Documents shall be cumulative and in addition to all other rights and remedies granted to Lender at law or in equity, whether or not the Indebtedness is due and payable and whether or not Lender shall have instituted any suit for collection or other action in connection with the Lodge Alley Loan Documents. 6.5 MARSHALLING WAIVER. Borrower waives any and all rights to require the marshalling of assets in connection with the exercise of any of the remedies hereunder. 6.6 APPLICATION OF PROCEEDS. The proceeds of any exercise of rights with respect to the Lodge Alley Collateral or any part thereof shall be paid to and applied as follows: FIRST, to the payment of (i) all Costs in connection therewith, including, without limitation, (1) attorneys' fees for advice, counsel or other legal services, (2) costs and expenses incurred as a result of pursuing, reclaiming, seeking to reclaim, taking, keeping, removing, storing, advertising for sale, selling and foreclosing on the Lodge Alley Collateral and any and all other charges and expenses in connection therewith, and (3) any costs and expenses (including, without limitation, costs and expenses in the management and operation of the Lodge Alley Resort) provided for in the Lodge Alley Assignment of Leases and Rents, the Lodge Alley Mortgage or any other Lodge Alley Loan Document, (ii) all taxes, assessments or liens superior to the lien of this Agreement or the other Lodge Alley Loan Documents, except any taxes, assessments or other superior liens subject to which any sale of Lodge Alley Collateral may have been made, and (iii) all other fees, costs and expenses otherwise payable hereunder; SECOND, towards the payment of accrued and unpaid interest then due and payable, if any, at the Default Rate in respect of the Lodge Alley Loan, THIRD, towards the payment of all other accrued and unpaid interest, if any, then due and payable in respect of the Lodge Alley Loan, FOURTH, to the payment of the principal amount of the Lodge Alley Loan and all other Indebtedness, and FIFTH, to the payment of any other obligations secured by the Lodge Alley Collateral, and 26

SIXTH, to the payment of the surplus, if any, to the Borrower, its successors and assigns, or to whomsoever may be lawfully entitled to receive the same, PROVIDED that if any Indebtedness or other obligations secured by the Lodge Alley Collateral then due and payable shall not have been paid in full, any such surplus shall continue to be held as Lodge Alley Collateral hereunder and shall continue to be subject to the terms and conditions hereof until such Indebtedness and obligations then due and payable shall have been paid in full. The Borrower shall remain liable hereunder for payment of any deficiency owing on the Indebtedness after application of such proceeds. ARTICLE 7 - GENERAL TERMS AND CONDITIONS 7.1 NOTICES. Any notice or other communication required or permitted to be given shall be in writing addressed to the respective party as set forth below and may be personally served, telecopied, or sent by overnight courier, or sent by registered or certified U.S. Mail return receipt requested, and shall be deemed given: (a) if served in person, when served; (b) if telecopied, on the date of transmission if before 3:00 p.m. (Chicago time) on a business day otherwise, on the next business day; PROVIDED that a confirmation of the receipt of

SIXTH, to the payment of the surplus, if any, to the Borrower, its successors and assigns, or to whomsoever may be lawfully entitled to receive the same, PROVIDED that if any Indebtedness or other obligations secured by the Lodge Alley Collateral then due and payable shall not have been paid in full, any such surplus shall continue to be held as Lodge Alley Collateral hereunder and shall continue to be subject to the terms and conditions hereof until such Indebtedness and obligations then due and payable shall have been paid in full. The Borrower shall remain liable hereunder for payment of any deficiency owing on the Indebtedness after application of such proceeds. ARTICLE 7 - GENERAL TERMS AND CONDITIONS 7.1 NOTICES. Any notice or other communication required or permitted to be given shall be in writing addressed to the respective party as set forth below and may be personally served, telecopied, or sent by overnight courier, or sent by registered or certified U.S. Mail return receipt requested, and shall be deemed given: (a) if served in person, when served; (b) if telecopied, on the date of transmission if before 3:00 p.m. (Chicago time) on a business day otherwise, on the next business day; PROVIDED that a confirmation of the receipt of any such telecopy is obtained and retained by the sending party and that a hard copy of such notice is also sent pursuant to (c) or (d) below; (c) if by overnight courier, on the first business day after delivery to the courier; or (d) if by certified or registered U.S. Mail, return receipt requested, on the fourth (4th) day after deposit in the mail postage prepaid. Notices to Borrower or Guarantor: Bluegreen Corporation
4960 Blue Lake Drive Boca Raton, Florida 33431 Attn: Patrick Rondeau, Esq. Telephone No.: (561) 912-8005 Telecopy: (561) 912-8299 Notices to Lender: Heller Financial, Inc. Attn: Portfolio Manager, Vacation Ownership HSF Loan No. 98-087 500 West Monroe St., 31st Fl. Chicago, Illinois 60661 Telecopy: (312) 441-7924

27
With a copy to: Heller Financial, Inc. Attn: Vacation Ownership Legal Representative HSF Loan No. 98-087 500 West Monroe St. 31st Fl. Chicago, Illinois 60661 Telecopy: (312) 441-7924

7.2 ENTIRE AGREEMENT AND MODIFICATIONS. This Agreement and the Lodge Alley Loan Documents constitute the entire understanding and agreement between the Borrower, the Lender and the Guarantor with respect to the transactions arising in connection with the Lodge Alley Loan and supersede all prior written or oral understandings and agreements between the undersigned in connection therewith. No provision of this Agreement or the other Lodge Alley Loan Documents may be modified, waived, terminated, supplemented, changed or amended except by a written instrument executed by all parties hereto or thereto. 7.3 SEVERABILITY. In case any of the provisions of this Agreement shall for any reason be held to be invalid, illegal, or unenforceable, such invalidity, illegality, or unenforceability shall not affect any other provision hereof, and this Agreement shall be construed as if such invalid, illegal, or unenforceable provision had never been contained herein. 7.4 ELECTION OF REMEDIES. Lender shall have all of the rights and remedies granted herein and in the

With a copy to:

Heller Financial, Inc. Attn: Vacation Ownership Legal Representative HSF Loan No. 98-087 500 West Monroe St. 31st Fl. Chicago, Illinois 60661 Telecopy: (312) 441-7924

7.2 ENTIRE AGREEMENT AND MODIFICATIONS. This Agreement and the Lodge Alley Loan Documents constitute the entire understanding and agreement between the Borrower, the Lender and the Guarantor with respect to the transactions arising in connection with the Lodge Alley Loan and supersede all prior written or oral understandings and agreements between the undersigned in connection therewith. No provision of this Agreement or the other Lodge Alley Loan Documents may be modified, waived, terminated, supplemented, changed or amended except by a written instrument executed by all parties hereto or thereto. 7.3 SEVERABILITY. In case any of the provisions of this Agreement shall for any reason be held to be invalid, illegal, or unenforceable, such invalidity, illegality, or unenforceability shall not affect any other provision hereof, and this Agreement shall be construed as if such invalid, illegal, or unenforceable provision had never been contained herein. 7.4 ELECTION OF REMEDIES. Lender shall have all of the rights and remedies granted herein and in the Lodge Alley Documents and available at law or in equity, and these same rights and remedies shall be cumulative and may be pursued separately, successively, or concurrently against the Guarantor, the Borrower or any property encumbered by the Lodge Alley Loan Documents, at the sole discretion of Lender. The exercise or failure to exercise any of the same shall not constitute a waiver or release thereof or of any other right or remedy, and the same shall be nonexclusive. 7.5 FORM AND SUBSTANCE. All documents, certificates, insurance policies, evidence, and other items required under this Agreement to be executed and/or delivered to Lender shall be in form and substance satisfactory to Lender in Lender's sole discretion. 7.6 NO THIRD PARTY BENEFICIARY. This Agreement is for the sole benefit of Lender and Bluegreen and is not for the benefit of any third party. 7.7 BLUEGREEN IN CONTROL. In no event shall Lender's rights and interests under the Lodge Alley Loan Documents be construed to give Lender the right to, or be deemed to indicate that Lender is in control of the business, management or properties of Guarantor or Borrower or has power over the daily management functions and operating decisions made by the Guarantor or Borrower. The execution and delivery of the Lodge Alley Loan Documents and the granting of the liens in and to the Lodge Alley Collateral shall not subject the Lender to, or transfer or pass to the Lender or in any way affect or modify, the liability of the Borrower under any or all of its contracts, receivables, general intangibles, Lodge Alley Resort Documents, the Lodge Alley Master Deed and the Lodge Alley Courtyard Restrictive Covenants, it being understood and 28

agreed that notwithstanding this Agreement and the other Lodge Alley Loan Documents, and the granting of the liens in and to the Lodge Alley Collateral, all of the obligations of the Borrower (whether as owner, chattel lessee, vendor, mortgagee, declarant, Lodge Alley Residential or Commercial Condominium Unit owner, Lodge Alley Club Interval owner or otherwise) to each and every other party under each and every one of the contracts, accounts, general intangibles, Lodge Alley Resort Documents, Lodge Alley Master Deed and Lodge Alley Courtyard Restrictive Covenants shall be and remain enforceable by such other party, its successors and assigns, only against the Borrower or Persons other than the Lender, and the Lender has not assumed any of the obligations or duties of the Borrower under or with respect to any of the foregoing. 7.8 NUMBER AND GENDER. Whenever used herein, the singular number shall include the plural and the plural the singular, and the use of any gender shall be applicable to all genders. 7.9 CAPTIONS. The captions, headings, and arrangements used in this Agreement are for convenience only and

agreed that notwithstanding this Agreement and the other Lodge Alley Loan Documents, and the granting of the liens in and to the Lodge Alley Collateral, all of the obligations of the Borrower (whether as owner, chattel lessee, vendor, mortgagee, declarant, Lodge Alley Residential or Commercial Condominium Unit owner, Lodge Alley Club Interval owner or otherwise) to each and every other party under each and every one of the contracts, accounts, general intangibles, Lodge Alley Resort Documents, Lodge Alley Master Deed and Lodge Alley Courtyard Restrictive Covenants shall be and remain enforceable by such other party, its successors and assigns, only against the Borrower or Persons other than the Lender, and the Lender has not assumed any of the obligations or duties of the Borrower under or with respect to any of the foregoing. 7.8 NUMBER AND GENDER. Whenever used herein, the singular number shall include the plural and the plural the singular, and the use of any gender shall be applicable to all genders. 7.9 CAPTIONS. The captions, headings, and arrangements used in this Agreement are for convenience only and do not in any way affect, limit, amplify, or modify the terms and provisions hereof. 7.10 APPLICABLE LAW. This Agreement shall be governed by and construed in accordance with the laws of the State of Illinois (without regard to conflicts of law principles) and the laws of the United States applicable to transactions within such state. 7.11 VENUE. EACH OF BORROWER AND GUARANTOR HEREBY CONSENTS TO THE JURISDICTION OF ANY STATE OR FEDERAL COURT LOCATED WITHIN THE COUNTY OF COOK, STATE OF ILLINOIS AND IRREVOCABLY AGREES THAT, SUBJECT TO LENDER*S ELECTION, ALL ACTIONS OR PROCEEDINGS ARISING OUT OF OR RELATING TO THIS AGREEMENT SHALL BE LITIGATED IN SUCH COURTS. EACH OF BORROWER AND GUARANTOR EXPRESSLY SUBMITS AND CONSENTS TO THE JURISDICTION OF THE AFORESAID COURTS AND WAIVES ANY DEFENSE OF FORUM NON CONVENIENS. EACH OF BORROWER AND GUARANTOR HEREBY WAIVES PERSONAL SERVICE OF ANY AND ALL PROCESS AND AGREES THAT ALL SUCH SERVICE OF PROCESS MAY BE MADE UPON SUCH PERSON BY CERTIFIED OR REGISTERED MAIL, RETURN RECEIPT REQUESTED, ADDRESSED TO SUCH PERSON, AT THE ADDRESS SET FORTH IN THIS AGREEMENT AND SERVICE SO MADE SHALL BE COMPLETE TEN (10) DAYS AFTER THE SAME HAS BEEN POSTED. 7.12 JURY TRIAL WAIVER. BORROWER, GUARANTOR AND LENDER HEREBY WAIVE THEIR RESPECTIVE RIGHTS TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING OUT OF THIS AGREEMENT. BORROWER, GUARANTOR AND LENDER ACKNOWLEDGE THAT THIS WAIVER IS A MATERIAL INDUCEMENT TO ENTER INTO A BUSINESS RELATIONSHIP, THAT EACH HAS RELIED ON THE WAIVER IN ENTERING INTO THIS AGREEMENT AND THAT EACH WILL CONTINUE TO RELY ON THE WAIVER IN THEIR RELATED FUTURE DEALINGS. BORROWER, GUARANTOR AND LENDER WARRANT AND REPRESENT THAT EACH HAS HAD THE OPPORTUNITY OF REVIEWING THIS JURY WAIVER WITH LEGAL COUNSEL, AND THAT EACH KNOWINGLY AND VOLUNTARILY WAIVES ITS JURY TRIAL RIGHTS. 7.13 COSTS. Borrower agrees to promptly pay all Costs and all such Costs shall be included as additional Indebtedness bearing interest at the Default Rate until paid. Without limiting the generality of the foregoing, in any action hereunder between the parties hereto, the prevailing party shall be entitled to attorneys' fees and costs including those for pretrial, trial and appellate proceedings. 7.14 COUNTERPARTS. This Agreement may be signed in multiple counterparts which taken together shall constitute the entire agreement between the parties. 7.15 CONSENT TO ADVERTISING AND PUBLICITY. Lender may issue and disseminate to the public press releases and other information describing the credit accommodations entered into pursuant to this Agreement, PROVIDED that Guarantor shall approve the description of such credit accommodation, which approval shall not be unreasonably withheld. 29

7.16 SURVIVAL. All representations, warranties, covenants and agreements made by Borrower herein, in the other Lodge Alley Loan Documents or in any other agreement, document, instrument or certificate delivered by or on behalf of Borrower under or pursuant to the Lodge Alley Loan Documents shall be considered to have been relied upon by Lender and shall survive the delivery to Lender of such Lodge Alley Loan Documents and the extension of the Indebtedness (and each part thereof), regardless of any investigation made by or on behalf of Lender. 7.17 PROTECTION OF COLLATERAL. Lender may at any time and from time to time take such actions as Lender deems necessary or appropriate to protect Lender's liens and security interests in and to preserve the Lodge Alley Collateral. Borrower agrees to cooperate fully with all of Lender's efforts to preserve the Lodge Alley Collateral and Lender's liens and security interests therein. 7.18 PERFORMANCE BY LENDER. If Borrower fails to perform any agreement contained herein or in any other Lodge Alley Loan Document, Lender may, but shall not be obligated to, cause the performance of such agreement, and the expenses of Lender incurred in connection therewith shall be payable by Borrower pursuant to Section 7.13 hereof. 7.19 POWER OF ATTORNEY. Borrower does hereby irrevocably constitute and appoint Lender as Borrower's true and lawful agent and attorney-in-fact, with full power of substitution, for Borrower and in Borrower's name, place and stead, or otherwise, to (a) endorse any checks or drafts payable to Borrower in the name of Borrower and in favor of Lender as provided in Section 6.1(f) above; (b) to demand and receive from time to time any and all property, rights, titles, interests and liens hereby sold, assigned and transferred, or intended so to be, and to give receipts for same; and (c) upon the occurrence and during the continuance of any Event of Default hereunder, (i) to institute and prosecute in the name of Borrower or otherwise, but for the benefit of Lender, any and all proceedings at law, in equity, or otherwise, that Lender may deem proper in order to collect, assert or enforce any claim, right or title, of any kind, in and to the property, rights, titles, interests and liens hereby sold, assigned or transferred, or intended so to be, and to defend and compromise any and all actions, suits or proceedings in respect of any of the said property, rights, titles, interests and liens, and (ii) generally to do all and any such acts and things in relation to the Lodge Alley Collateral as Lender shall in good faith deem advisable. Borrower hereby declares that the appointment made and the powers granted pursuant to this Section are coupled with an interest and are and shall be irrevocable by Borrower in any manner, or for any reason, unless and until all obligations of Borrower to Lender have been satisfied. 30

IN WITNESS WHEREOF, the parties set their hands as of the date above first written. BLUEGREEN VACATIONS UNLIMITED, INC.
By: /s/ PATRICK E. RONDEAU ------------------------------Name: Patrick E. Rondeau Its: President

CONSENTED AND AGREED TO: BLUEGREEN CORPORATION
By: /s/ PATRICK E. RONDEAU ------------------------------Name: Patrick E. Rondeau Title: Senior Vice President

HELLER FINANCIAL, INC.
By: /s/ JANICE K. NOCITA

IN WITNESS WHEREOF, the parties set their hands as of the date above first written. BLUEGREEN VACATIONS UNLIMITED, INC.
By: /s/ PATRICK E. RONDEAU ------------------------------Name: Patrick E. Rondeau Its: President

CONSENTED AND AGREED TO: BLUEGREEN CORPORATION
By: /s/ PATRICK E. RONDEAU ------------------------------Name: Patrick E. Rondeau Title: Senior Vice President

HELLER FINANCIAL, INC.
By: /s/ JANICE K. NOCITA ------------------------------Name: JANICE K. NOCITA Its: VICE PRESIDENT

31

EXHIBIT 10.140 LOAN AGREEMENT DATED AS OF SEPTEMBER 24, 1999 BETWEEN BLUEGREEN PROPERTIES OF VIRGINIA, INC., A DELAWARE CORPORATION; AND BRANCH BANKING AND TRUST COMPANY, A NORTH CAROLINA BANKING CORPORATION

TABLE OF CONTENTS

SECTION 1.1 1.2 1.3 1.4 1.5 1.6 1.7 1.8 1.9

1. (a) Definitions and Terms..................................................................... "Acquisition and Phase I Development Loan"....................................................... "Acquisition and Phase I Development Note"....................................................... "Agreement"...................................................................................... "Architects"..................................................................................... "Architects' Collateral Assignment".............................................................. "Business Day"................................................................................... "Closing Date"................................................................................... "Clubhouse Architect"............................................................................ "Code"...........................................................................................

EXHIBIT 10.140 LOAN AGREEMENT DATED AS OF SEPTEMBER 24, 1999 BETWEEN BLUEGREEN PROPERTIES OF VIRGINIA, INC., A DELAWARE CORPORATION; AND BRANCH BANKING AND TRUST COMPANY, A NORTH CAROLINA BANKING CORPORATION

TABLE OF CONTENTS

SECTION 1.1 1.2 1.3 1.4 1.5 1.6 1.7 1.8 1.9 1.10 1.11 1.12 1.13 1.14 1.15 1.16 1.17 1.18 1.19 1.20 1.21 1.22 1.23 1.24 1.25 1.26 1.27 1.28 1.29 1.30

1. (a) Definitions and Terms..................................................................... "Acquisition and Phase I Development Loan"....................................................... "Acquisition and Phase I Development Note"....................................................... "Agreement"...................................................................................... "Architects"..................................................................................... "Architects' Collateral Assignment".............................................................. "Business Day"................................................................................... "Closing Date"................................................................................... "Clubhouse Architect"............................................................................ "Code"........................................................................................... "Collateral".................................................................................... "Collateral Assignment"......................................................................... "Cost Breakdown"................................................................................ "Consistent Basis".............................................................................. "Contractors' Collateral Assignment"............................................................ "Deed of Trust"................................................................................. "Default"....................................................................................... "Development"................................................................................... "Environmental Laws"............................................................................ "ERISA"......................................................................................... "Event of Default".............................................................................. "Guarantor"..................................................................................... "Guaranty Agreement"............................................................................ "Generally Accepted Accounting Principles"...................................................... "Golf Course Architect"......................................................................... "Golf Course Improvements"...................................................................... "Golf Course Loan".............................................................................. "Golf Course Note".............................................................................. "Golf Course Plans and Specifications".......................................................... "Hazardous Materials"........................................................................... "Improvements"..................................................................................

TABLE OF CONTENTS

SECTION 1.1 1.2 1.3 1.4 1.5 1.6 1.7 1.8 1.9 1.10 1.11 1.12 1.13 1.14 1.15 1.16 1.17 1.18 1.19 1.20 1.21 1.22 1.23 1.24 1.25 1.26 1.27 1.28 1.29 1.30 1.31 1.32 1.33 1.34 1.35 1.36 1.37 1.38 1.39 1.40 1.41

1. (a) Definitions and Terms..................................................................... "Acquisition and Phase I Development Loan"....................................................... "Acquisition and Phase I Development Note"....................................................... "Agreement"...................................................................................... "Architects"..................................................................................... "Architects' Collateral Assignment".............................................................. "Business Day"................................................................................... "Closing Date"................................................................................... "Clubhouse Architect"............................................................................ "Code"........................................................................................... "Collateral".................................................................................... "Collateral Assignment"......................................................................... "Cost Breakdown"................................................................................ "Consistent Basis".............................................................................. "Contractors' Collateral Assignment"............................................................ "Deed of Trust"................................................................................. "Default"....................................................................................... "Development"................................................................................... "Environmental Laws"............................................................................ "ERISA"......................................................................................... "Event of Default".............................................................................. "Guarantor"..................................................................................... "Guaranty Agreement"............................................................................ "Generally Accepted Accounting Principles"...................................................... "Golf Course Architect"......................................................................... "Golf Course Improvements"...................................................................... "Golf Course Loan".............................................................................. "Golf Course Note".............................................................................. "Golf Course Plans and Specifications".......................................................... "Hazardous Materials"........................................................................... "Improvements".................................................................................. "Indebtedness".................................................................................. "Indebtedness for Money Borrowed"............................................................... "Land Development Architect".................................................................... "Land Development Improvements"................................................................. "Land Development Plans and Specifications"..................................................... "Loan Documents"................................................................................ "Notes"......................................................................................... "Obligations"................................................................................... "Permitted Encumbrances"........................................................................ "Person"........................................................................................ "Phase I".......................................................................................

i
1.42 1.43 1.44 1.45 1.46 1.47 1.48 SECTION 2.1 2.2 2.3 "Phase II"...................................................................................... "Phase II Development Loan"..................................................................... "Phase II Development Note"..................................................................... "Plans and Specifications"...................................................................... "Prime Rate".................................................................................... "Property"...................................................................................... "Security Agreement"............................................................................

2. The Loans..................................................................................... The Development.................................................................................. Acquisition and Phase I Development Loan and Phase II Development Loan........................... Conditions of Lender's Obligations to Make Disbursements under the Acquisition and Phase I Development Loan and the Phase II Development Loan....................................... 2.4 Golf Course Loan................................................................................. 2.5 Conditions of Lender's Obligations to Make Disbursements under the Golf Course Loan.............. 2.6 Manner of Payment For All Loans.................................................................. 2.7 Non-Conforming Payment........................................................................... 2.8 Payments on Business Days........................................................................ 2.9 Computation of Interest.......................................................................... 2.10 Release of Lots and Application of Net Sales Proceeds........................................... 2.11 Prepayment...................................................................................... Security.....................................................................................

SECTION 3.

SECTION 4. Representations and Warranties............................................................... 4.1 Organization, etc................................................................................

1.42 1.43 1.44 1.45 1.46 1.47 1.48 SECTION 2.1 2.2 2.3

"Phase II"...................................................................................... "Phase II Development Loan"..................................................................... "Phase II Development Note"..................................................................... "Plans and Specifications"...................................................................... "Prime Rate".................................................................................... "Property"...................................................................................... "Security Agreement"............................................................................

2. The Loans..................................................................................... The Development.................................................................................. Acquisition and Phase I Development Loan and Phase II Development Loan........................... Conditions of Lender's Obligations to Make Disbursements under the Acquisition and Phase I Development Loan and the Phase II Development Loan....................................... 2.4 Golf Course Loan................................................................................. 2.5 Conditions of Lender's Obligations to Make Disbursements under the Golf Course Loan.............. 2.6 Manner of Payment For All Loans.................................................................. 2.7 Non-Conforming Payment........................................................................... 2.8 Payments on Business Days........................................................................ 2.9 Computation of Interest.......................................................................... 2.10 Release of Lots and Application of Net Sales Proceeds........................................... 2.11 Prepayment...................................................................................... Security.....................................................................................

SECTION 3. SECTION 4.1 4.2 4.3 4.4 4.5 4.6 4.7 4.8 4.9 4.10 4.11 4.12 4.13 4.14 4.15 4.16 4.17 4.18 4.19

4. Representations and Warranties............................................................... Organization, etc................................................................................ Power and Authority.............................................................................. Financial Condition.............................................................................. Title to Assets.................................................................................. Litigation....................................................................................... Locations........................................................................................ Taxes............................................................................................ Contract or Restriction Affecting the Borrower................................................... Trademarks, Franchises and Licenses.............................................................. No Default...................................................................................... Governmental Authority.......................................................................... Regulation U.................................................................................... ERISA Requirements.............................................................................. No Untrue Statements............................................................................ Hazardous Materials............................................................................. Sufficiency of Loans............................................................................ Utilities and Access............................................................................ Restrictive Covenants........................................................................... Year 2000 Compliant.............................................................................

ii
SECTION 5 Conditions of Closing.......................................................................... 5.1 Legal Opinions................................................................................... 5.2 Closing Documents................................................................................ SECTION 6.2 6.3 6.4 6.5 6.6 6.7 6.8 6.9 6.10 6.11 6.12 6.13 6.14 6.15 6.16 6.17 6.18 6.19 6.20 6.21 6.22 6.23 6.24 6. Affirmative Covenants......................................................................... Taxes and Liens.................................................................................. Business and Existence........................................................................... Insurance........................................................................................ Maintain Property................................................................................ True Books....................................................................................... Inspection Rights................................................................................ The Borrower's Knowledge of Certain Events....................................................... Other Notices.................................................................................... Further Assurances.............................................................................. Observe All Laws................................................................................ ERISA........................................................................................... Payment of Obligations.......................................................................... Continued Operations............................................................................ Principal Banking Relationship.................................................................. Hazardous Waste Indemnity....................................................................... Use of Loan Proceeds............................................................................ Water and Sewer Capacity........................................................................ Commencement of Construction.................................................................... Contractors..................................................................................... Inspection, Plans and Receipts.................................................................. Surveys......................................................................................... Payment of Cost Overruns........................................................................ Year 2000 Compliance............................................................................

SECTION 7. Negative Covenants of the Borrower............................................................

SECTION 5 Conditions of Closing.......................................................................... 5.1 Legal Opinions................................................................................... 5.2 Closing Documents................................................................................ SECTION 6.2 6.3 6.4 6.5 6.6 6.7 6.8 6.9 6.10 6.11 6.12 6.13 6.14 6.15 6.16 6.17 6.18 6.19 6.20 6.21 6.22 6.23 6.24 SECTION 7.1 7.2 7.3 7.4 7.5 7.6 7.7 7.8 SECTION 8.1 8.2 8.3 8.4 8.5 8.6 6. Affirmative Covenants......................................................................... Taxes and Liens.................................................................................. Business and Existence........................................................................... Insurance........................................................................................ Maintain Property................................................................................ True Books....................................................................................... Inspection Rights................................................................................ The Borrower's Knowledge of Certain Events....................................................... Other Notices.................................................................................... Further Assurances.............................................................................. Observe All Laws................................................................................ ERISA........................................................................................... Payment of Obligations.......................................................................... Continued Operations............................................................................ Principal Banking Relationship.................................................................. Hazardous Waste Indemnity....................................................................... Use of Loan Proceeds............................................................................ Water and Sewer Capacity........................................................................ Commencement of Construction.................................................................... Contractors..................................................................................... Inspection, Plans and Receipts.................................................................. Surveys......................................................................................... Payment of Cost Overruns........................................................................ Year 2000 Compliance............................................................................ 7. Negative Covenants of the Borrower............................................................ Indebtedness..................................................................................... Limitations on Liens............................................................................. Transfer of Assets............................................................................... Insider Transactions............................................................................. Change Orders.................................................................................... Distributions, Redemptions and Other Payments.................................................... Loans and Investments............................................................................ No Mining........................................................................................ 8. Events of Default and Remedies............................................................... Payment of Notes................................................................................. Payment of Other Indebtedness.................................................................... Representation, Warranty, Etc.................................................................... Certain Covenants................................................................................ Other Covenants.................................................................................. Other Documents..................................................................................

iii
8.7 Liquidation or Dissolution....................................................................... 8.8 Bankruptcy, Etc.................................................................................. 8.9 Judgment......................................................................................... 8.10 Transfer or Encumbrance......................................................................... 8.11 Security Interest............................................................................... 8.12 Option to Pay Contractors....................................................................... SECTION 9.1 9.2 9.3 9.4 9.5 9.6 9.7 9.8 9.9 9.10 9.11 9.12 9.13 9. Miscellaneous................................................................................ Waivers, Amendments, Etc......................................................................... Waiver of Default................................................................................ Lien............................................................................................. Notices.......................................................................................... Survival of Agreements........................................................................... Governing Law and Jurisdiction................................................................... Enforceability of Agreement...................................................................... Counterparts and Effectiveness................................................................... Fees and Expenses................................................................................ Liens; Set Off by Lender........................................................................ Assignment...................................................................................... Indemnity....................................................................................... Entire Agreement................................................................................

iv
EXHIBIT 1 Improvements..................................................................................

8.7 Liquidation or Dissolution....................................................................... 8.8 Bankruptcy, Etc.................................................................................. 8.9 Judgment......................................................................................... 8.10 Transfer or Encumbrance......................................................................... 8.11 Security Interest............................................................................... 8.12 Option to Pay Contractors....................................................................... SECTION 9.1 9.2 9.3 9.4 9.5 9.6 9.7 9.8 9.9 9.10 9.11 9.12 9.13 9. Miscellaneous................................................................................ Waivers, Amendments, Etc......................................................................... Waiver of Default................................................................................ Lien............................................................................................. Notices.......................................................................................... Survival of Agreements........................................................................... Governing Law and Jurisdiction................................................................... Enforceability of Agreement...................................................................... Counterparts and Effectiveness................................................................... Fees and Expenses................................................................................ Liens; Set Off by Lender........................................................................ Assignment...................................................................................... Indemnity....................................................................................... Entire Agreement................................................................................

iv
EXHIBIT 1 Improvements.................................................................................. EXHIBIT 2 Acquisition and Phase I Development Note...................................................... EXHIBIT 3 Phase II Development Note..................................................................... EXHIBIT 4 Golf Course Note.............................................................................. EXHIBIT 5 Phase I and Phase II.......................................................................... EXHIBIT 6 Form of Opinion of Counsel for Borrower....................................................... Schedule 2.10 Minimum Release Fee Schedule.............................................................. Schedule 4.18 Conditions of Title.......................................................................

v

LOAN AGREEMENT THIS LOAN AGREEMENT made and entered into as of this 24th day of September, 1999, by and between BLUEGREEN PROPERTIES OF VIRGINIA, INC., a Delaware corporation (the "Borrower") and BRANCH BANKING AND TRUST COMPANY, a North Carolina banking corporation (the "Lender"); W I T N E S S E T H: SECTION 1. (a) DEFINITIONS AND TERMS. For purposes of this Agreement, the following terms shall have the following meanings: 1.1 "Acquisition and Phase I Development Loan" shall have the meaning set forth in Section 2.2. 1.2 "Acquisition and Phase I Development Note" means the promissory note of the Borrower of even date herewith in the original principal amount of $9,200,000 substantially in the form of EXHIBIT 2 attached hereto and incorporated herein by this reference. 1.3 "Agreement" means this Loan Agreement, including all exhibits hereto, as the same may from time to time be modified, amended or supplemented. 1.4 "Architects" means collectively the Land Development Architect, the Clubhouse Architect and the Golf Course Architect. 1.5 "Architects' Collateral Assignment" means the Assignment of the Land Development Architect's Agreement, the Clubhouse Architect's Agreement and the Golf Course Architect's Agreement from the Borrower to the Lender, and all amendments thereof. 1.6 "Business Day" means a day upon which commercial banks are open for the transaction of business of the

EXHIBIT 1 Improvements.................................................................................. EXHIBIT 2 Acquisition and Phase I Development Note...................................................... EXHIBIT 3 Phase II Development Note..................................................................... EXHIBIT 4 Golf Course Note.............................................................................. EXHIBIT 5 Phase I and Phase II.......................................................................... EXHIBIT 6 Form of Opinion of Counsel for Borrower....................................................... Schedule 2.10 Minimum Release Fee Schedule.............................................................. Schedule 4.18 Conditions of Title.......................................................................

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LOAN AGREEMENT THIS LOAN AGREEMENT made and entered into as of this 24th day of September, 1999, by and between BLUEGREEN PROPERTIES OF VIRGINIA, INC., a Delaware corporation (the "Borrower") and BRANCH BANKING AND TRUST COMPANY, a North Carolina banking corporation (the "Lender"); W I T N E S S E T H: SECTION 1. (a) DEFINITIONS AND TERMS. For purposes of this Agreement, the following terms shall have the following meanings: 1.1 "Acquisition and Phase I Development Loan" shall have the meaning set forth in Section 2.2. 1.2 "Acquisition and Phase I Development Note" means the promissory note of the Borrower of even date herewith in the original principal amount of $9,200,000 substantially in the form of EXHIBIT 2 attached hereto and incorporated herein by this reference. 1.3 "Agreement" means this Loan Agreement, including all exhibits hereto, as the same may from time to time be modified, amended or supplemented. 1.4 "Architects" means collectively the Land Development Architect, the Clubhouse Architect and the Golf Course Architect. 1.5 "Architects' Collateral Assignment" means the Assignment of the Land Development Architect's Agreement, the Clubhouse Architect's Agreement and the Golf Course Architect's Agreement from the Borrower to the Lender, and all amendments thereof. 1.6 "Business Day" means a day upon which commercial banks are open for the transaction of business of the nature contemplated by this Agreement in Wilmington, North Carolina. 1.7 "Closing Date" means the date this Agreement is signed by the parties hereto and the conditions of Section 5 are fulfilled to the satisfaction of the Lender. 1.8 "Clubhouse Architect" means the architect selected by the Borrower and approved by the Lender who shall design the clubhouse set forth in the Golf Course Plans and Specifications. 1.9 "Code" means the Internal Revenue Code of 1986, as amended from time to time, including any rules and regulations (whether final or temporary) promulgated thereunder. 1

1.10 "Collateral" means, collectively, (i) the real and personal property covered by the Deed of Trust, Security Agreement, the Collateral Assignment and other Loan Documents and (ii) the products and proceeds of the foregoing, including, without limitation, insurance proceeds and condemnation awards relating thereto. 1.11 "Collateral Assignment" means the Collateral Assignment of Rents and Income from the Borrower to the Lender covering rents, golf course income and other rents and income relating to the Development, and all

LOAN AGREEMENT THIS LOAN AGREEMENT made and entered into as of this 24th day of September, 1999, by and between BLUEGREEN PROPERTIES OF VIRGINIA, INC., a Delaware corporation (the "Borrower") and BRANCH BANKING AND TRUST COMPANY, a North Carolina banking corporation (the "Lender"); W I T N E S S E T H: SECTION 1. (a) DEFINITIONS AND TERMS. For purposes of this Agreement, the following terms shall have the following meanings: 1.1 "Acquisition and Phase I Development Loan" shall have the meaning set forth in Section 2.2. 1.2 "Acquisition and Phase I Development Note" means the promissory note of the Borrower of even date herewith in the original principal amount of $9,200,000 substantially in the form of EXHIBIT 2 attached hereto and incorporated herein by this reference. 1.3 "Agreement" means this Loan Agreement, including all exhibits hereto, as the same may from time to time be modified, amended or supplemented. 1.4 "Architects" means collectively the Land Development Architect, the Clubhouse Architect and the Golf Course Architect. 1.5 "Architects' Collateral Assignment" means the Assignment of the Land Development Architect's Agreement, the Clubhouse Architect's Agreement and the Golf Course Architect's Agreement from the Borrower to the Lender, and all amendments thereof. 1.6 "Business Day" means a day upon which commercial banks are open for the transaction of business of the nature contemplated by this Agreement in Wilmington, North Carolina. 1.7 "Closing Date" means the date this Agreement is signed by the parties hereto and the conditions of Section 5 are fulfilled to the satisfaction of the Lender. 1.8 "Clubhouse Architect" means the architect selected by the Borrower and approved by the Lender who shall design the clubhouse set forth in the Golf Course Plans and Specifications. 1.9 "Code" means the Internal Revenue Code of 1986, as amended from time to time, including any rules and regulations (whether final or temporary) promulgated thereunder. 1

1.10 "Collateral" means, collectively, (i) the real and personal property covered by the Deed of Trust, Security Agreement, the Collateral Assignment and other Loan Documents and (ii) the products and proceeds of the foregoing, including, without limitation, insurance proceeds and condemnation awards relating thereto. 1.11 "Collateral Assignment" means the Collateral Assignment of Rents and Income from the Borrower to the Lender covering rents, golf course income and other rents and income relating to the Development, and all supplements and amendments thereto. 1.12 "Cost Breakdown" means the comprehensive list of all costs to be incurred in constructing the Improvements and all other uses of all proceeds of the Acquisition and Phase I Development Loan, the Phase II Development Loan and the Golf Course Loan under this Agreement in connection with the Development. 1.13 "Consistent Basis" means in reference to the application of Generally Accepted Accounting Principles, that the accounting principles observed in the current period are comparable in all material respects to those applied in the preceding period, except as otherwise permitted by this Agreement or as may be different as a result of a change in Generally Accepted Accounting Principles (except there shall be no instance allowing upward

1.10 "Collateral" means, collectively, (i) the real and personal property covered by the Deed of Trust, Security Agreement, the Collateral Assignment and other Loan Documents and (ii) the products and proceeds of the foregoing, including, without limitation, insurance proceeds and condemnation awards relating thereto. 1.11 "Collateral Assignment" means the Collateral Assignment of Rents and Income from the Borrower to the Lender covering rents, golf course income and other rents and income relating to the Development, and all supplements and amendments thereto. 1.12 "Cost Breakdown" means the comprehensive list of all costs to be incurred in constructing the Improvements and all other uses of all proceeds of the Acquisition and Phase I Development Loan, the Phase II Development Loan and the Golf Course Loan under this Agreement in connection with the Development. 1.13 "Consistent Basis" means in reference to the application of Generally Accepted Accounting Principles, that the accounting principles observed in the current period are comparable in all material respects to those applied in the preceding period, except as otherwise permitted by this Agreement or as may be different as a result of a change in Generally Accepted Accounting Principles (except there shall be no instance allowing upward revaluation of assets). 1.14 "Contractors' Collateral Assignment" means the Assignment of Contractor's Contracts from the Borrower to the Lender relating to the construction of the Improvements, and all amendments thereof. 1.15 "Deed of Trust" means that certain deed of trust of even date herewith from the Borrower in favor of the Lender covering the Property. 1.16 "Default" means any event which constitutes an Event of Default or which, with the giving of notice, lapse of time permitted by an applicable grace period, or both, would become an Event of Default. 1.17 "Development" means that certain residential golf community located on those tracts of land covered by the Deed of Trust known as Brickshire and all improvements now or hereafter located thereon. The Development is located on the Property. 1.18 "Environmental Laws" means and includes the Comprehensive Environmental Response, Compensation and Liability Act of 1980, the Resource Conservation and Recovery Act, the Superfund Amendments and Reauthorization Act of 1986, any other "Superfund" or "Superlien" law, or any other federal, state or local statute, law, ordinance, code, rule, regulation, order or decree regulating, relating to, 2

or imposing liability or standards of conduct concerning any Hazardous Materials, as now or at any time hereafter in effect. 1.19 "ERISA" means the Employee Retirement Income Security Act of 1974, as amended from time to time, including any rules and regulations promulgated thereunder. 1.20 "Event of Default" has the meaning given such term in Section 8 hereof. 1.21 "Guarantor" means Bluegreen Corporation, a Massachusetts corporation, and its successors and assigns. 1.22 "Guaranty Agreement" means the Guaranty Agreement between the Guarantor and the Lender of even date herewith, and all amendments and supplements thereto. 1.23 "Generally Accepted Accounting Principles" means those principles of accounting set forth in statements of the Financial Accounting Standards Board or which have other substantial authoritative support and are applicable in the circumstances as of the date of a report, as such principles are from time to time supplemented and amended. 1.24 "Golf Course Architect" means the architect selected by the Borrower and approved by the Lender, who

or imposing liability or standards of conduct concerning any Hazardous Materials, as now or at any time hereafter in effect. 1.19 "ERISA" means the Employee Retirement Income Security Act of 1974, as amended from time to time, including any rules and regulations promulgated thereunder. 1.20 "Event of Default" has the meaning given such term in Section 8 hereof. 1.21 "Guarantor" means Bluegreen Corporation, a Massachusetts corporation, and its successors and assigns. 1.22 "Guaranty Agreement" means the Guaranty Agreement between the Guarantor and the Lender of even date herewith, and all amendments and supplements thereto. 1.23 "Generally Accepted Accounting Principles" means those principles of accounting set forth in statements of the Financial Accounting Standards Board or which have other substantial authoritative support and are applicable in the circumstances as of the date of a report, as such principles are from time to time supplemented and amended. 1.24 "Golf Course Architect" means the architect selected by the Borrower and approved by the Lender, who shall design the golf course, as well as other Golf Course Improvements set forth in the Golf Course Plans and Specifications. 1.25 "Golf Course Improvements" means the golf course, clubhouse, amenities and other golf course related improvements to be constructed in the Development and furniture and fixtures to be incorporated or used in such improvements, as described on EXHIBIT 1 attached hereto and incorporated by this reference. 1.26 "Golf Course Loan" shall have the meaning set forth in Section 2.4. 1.27 "Golf Course Note" means the promissory note of the Borrower of even date herewith in the original principal amount of $4,200,000 substantially in the form of EXHIBIT 3 attached hereto and incorporated herein by this reference. 1.28 "Golf Course Plans and Specifications" means the final plans and specifications for the construction of the Golf Course Improvements prepared by the Golf Course Architect and Clubhouse Architect, as applicable, and all amendments and modifications thereto. 3

1.29 "Hazardous Materials" means and includes any hazardous, toxic or dangerous waste, substance or material (including without limitation any materials containing asbestos) defined as such in (or for purposes of) any Environmental Laws. 1.30 "Improvements" means collectively the Golf Course Improvements and the Land Development Improvements. 1.31 "Indebtedness" means, with respect to any Person, without duplication, (a) all obligations of such Person for borrowed money or with respect to deposits or advances of any kind, (b) all obligations of such Person evidenced by bonds, debentures, notes or similar instruments, (c) all obligations of such Person upon which interest charges are customarily paid, (d) all obligations of such Person under conditional sale or other title retention agreements relating to property or assets purchased by such Person, (e) all obligations of such Person incurred or assumed as the deferred purchase price of property or services, (f) all indebtedness of others secured by (or for which the holder of such indebtedness has an existing right, contingent or otherwise, to be secured by) any lien on property owned or acquired by such Person, whether or not the obligations secured thereby have been assumed, (g) all guaranties by such Person of indebtedness of others, (h) all capital lease obligations of such person, (i) all obligations of such Person in respect of interest rate protection agreements, foreign currency exchange agreements or other interest or exchange rate hedging arrangements and (j) all obligations of such Person as an account party in respect of letters of credit and bankers' acceptances. The Indebtedness of any

1.29 "Hazardous Materials" means and includes any hazardous, toxic or dangerous waste, substance or material (including without limitation any materials containing asbestos) defined as such in (or for purposes of) any Environmental Laws. 1.30 "Improvements" means collectively the Golf Course Improvements and the Land Development Improvements. 1.31 "Indebtedness" means, with respect to any Person, without duplication, (a) all obligations of such Person for borrowed money or with respect to deposits or advances of any kind, (b) all obligations of such Person evidenced by bonds, debentures, notes or similar instruments, (c) all obligations of such Person upon which interest charges are customarily paid, (d) all obligations of such Person under conditional sale or other title retention agreements relating to property or assets purchased by such Person, (e) all obligations of such Person incurred or assumed as the deferred purchase price of property or services, (f) all indebtedness of others secured by (or for which the holder of such indebtedness has an existing right, contingent or otherwise, to be secured by) any lien on property owned or acquired by such Person, whether or not the obligations secured thereby have been assumed, (g) all guaranties by such Person of indebtedness of others, (h) all capital lease obligations of such person, (i) all obligations of such Person in respect of interest rate protection agreements, foreign currency exchange agreements or other interest or exchange rate hedging arrangements and (j) all obligations of such Person as an account party in respect of letters of credit and bankers' acceptances. The Indebtedness of any Person shall include the Indebtedness of any partnership in which such Person is a general partner. Indebtedness does not include trade debt incurred by such Person in the ordinary course of business. 1.32 "Indebtedness for Money Borrowed" means indebtedness of the Borrower for money borrowed; including without limitation the deferred purchase price of any property or asset and all liabilities guaranteed or assumed, directly or indirectly, in any manner, or endorsed (otherwise than for collection or deposit in the ordinary course of business) or discounted with recourse. 1.33 "Land Development Architect" means the architect selected by the Borrower and approved by the Lender, who shall design the Land Improvements as set forth in the Land Development Plans and Specifications. 1.34 "Land Development Improvements" means the streets, sidewalks, water and sewer lines and other improvements to be constructed in the Development to permit residential lots to be sold to third parties for single family homes and to develop the Development and certain off-site improvements for the entry road and the water and sewer system to serve the Development. 1.35 "Land Development Plans and Specifications" means the final plans and specifications for the construction of the Land Development Improvements prepared 4

by the Land Development Architect and other professionals retained by the Borrower, and all amendments and modifications thereto. 1.36 "Loan Documents" means this Agreement, the Notes, the Deed of Trust, the Security Agreement, the Collateral Assignment, the Architects' Collateral Assignment, the Contractors' Collateral Assignment, the Guaranty Agreement and all other documents related thereto. 1.37 "Notes" means collectively the Acquisition and Phase I Development Note, the Phase II Development Note and the Golf Course Note, and all amendments and supplements thereto. 1.38 "Obligations" means all of the undertakings and promises of the Borrower in the Loan Documents including, without limitation, all agreements, representations, warranties and covenants. 1.39 "Permitted Encumbrances" means and includes: (i) liens for taxes, assessments and other governmental charges due but not yet payable or being actively contested in good faith by appropriate proceedings effectively staying any action or proceeding to foreclose any

by the Land Development Architect and other professionals retained by the Borrower, and all amendments and modifications thereto. 1.36 "Loan Documents" means this Agreement, the Notes, the Deed of Trust, the Security Agreement, the Collateral Assignment, the Architects' Collateral Assignment, the Contractors' Collateral Assignment, the Guaranty Agreement and all other documents related thereto. 1.37 "Notes" means collectively the Acquisition and Phase I Development Note, the Phase II Development Note and the Golf Course Note, and all amendments and supplements thereto. 1.38 "Obligations" means all of the undertakings and promises of the Borrower in the Loan Documents including, without limitation, all agreements, representations, warranties and covenants. 1.39 "Permitted Encumbrances" means and includes: (i) liens for taxes, assessments and other governmental charges due but not yet payable or being actively contested in good faith by appropriate proceedings effectively staying any action or proceeding to foreclose any such lien; (ii) landlord's, warehouseman's, carrier's, worker's, vendor's, mechanic's and materialmen's liens and similar liens incurred in the ordinary course of business remaining undischarged (or not bonded off such that the related liens no longer attach to any Collateral) for not longer than 60 days from the filing thereof or being contested in good faith by appropriate proceedings effectively staying any action or proceeding to foreclose any such lien; (iii) attachments remaining undischarged for not longer than 60 days from the making thereof or being contested in good faith by appropriate proceedings effectively staying any action or proceeding to foreclose any such lien; (iv) liens in respect of judgments or awards which have become final and unappealable and remain undischarged for not longer than 60 days from the date of attachment thereof to any Collateral; (v) liens in respect of pledges or deposits under worker's compensation laws, unemployment insurance or similar legislation and in respect of pledges or deposits to secure bids, tenders, contracts (other than contracts for the payment of money), leases or statutory 5

obligations, or in connection with surety, appeal and similar bonds incidental to the conduct of litigation; (vi) the liens created by the Loan Documents or otherwise in favor of the Lender. 1.40 "Person" means any individual, joint venture, corporation, company, voluntary association, partnership, trust, joint stock company, unincorporated organization, association, government, or any agency, instrumentality, or political subdivision thereof, or any other form of entity. 1.41 "Phase I" means that portion of the Development, as more particularly described in EXHIBIT 5. 1.42 "Phase II" means that portion of the Development, including all land and improvements, as more particularly described in EXHIBIT 5. 1.43 "Phase II Development Loan" shall have the meaning set forth in Section 2.2. 1.44 "Phase II Development Note" means the promissory note of the Borrower of even date herewith in the original principal amount of $6,550,000 substantially in the form of EXHIBIT 4 attached hereto and incorporated herein by this reference. 1.45 "Plans and Specifications" means collectively the Golf Course Plans and Specifications and the Land

obligations, or in connection with surety, appeal and similar bonds incidental to the conduct of litigation; (vi) the liens created by the Loan Documents or otherwise in favor of the Lender. 1.40 "Person" means any individual, joint venture, corporation, company, voluntary association, partnership, trust, joint stock company, unincorporated organization, association, government, or any agency, instrumentality, or political subdivision thereof, or any other form of entity. 1.41 "Phase I" means that portion of the Development, as more particularly described in EXHIBIT 5. 1.42 "Phase II" means that portion of the Development, including all land and improvements, as more particularly described in EXHIBIT 5. 1.43 "Phase II Development Loan" shall have the meaning set forth in Section 2.2. 1.44 "Phase II Development Note" means the promissory note of the Borrower of even date herewith in the original principal amount of $6,550,000 substantially in the form of EXHIBIT 4 attached hereto and incorporated herein by this reference. 1.45 "Plans and Specifications" means collectively the Golf Course Plans and Specifications and the Land Development Plans and Specifications. 1.46 "Prime Rate" means that rate of interest announced by the Lender from time to time to be its Prime Rate, any change in such rate to become effective on the date of such change in such Prime Rate. 1.47 "Property" means collectively those tracts of real property located in New Kent County, Virginia and covered by the Deed of Trust of which the Development is a part containing approximately 1,135 acres and described on EXHIBIT 5. 1.48 "Security Agreement" means the Security Agreement of even date herewith between the Borrower and the Lender pursuant to which Borrower grants a security interest to the Lender in the accounts receivables, inventory, machinery, equipment, furniture, fixtures and other property described therein and any amendments or supplements permitted thereto. 6

(b) ACCOUNTING TERMS AND DETERMINATIONS. Unless otherwise specified or provided herein, all accounting terms used herein shall be interpreted, all determinations with respect to accounting matters hereunder shall be made, and all financial statements and certificates and reports as to financial matters required to be delivered hereunder shall be prepared, in accordance with Generally Accepted Accounting Principles as in effect from time to time, applied on a Consistent Basis. (c) TERMS IN LOAN DOCUMENTS. All of the terms defined in this Agreement shall have such defined meanings when used in the Notes, the other Loan Documents, and any certificates, reports or other documents issued under or delivered pursuant to this Agreement unless the context shall require otherwise. SECTION 2. THE LOANS. 2.1 THE DEVELOPMENT. The Borrower proposes to develop a residential golf course community known as Brickshire. The Development will consist of an 18 hole golf course, related clubhouse and amenities, water and sewer system to be dedicated to New Kent County and road improvements to be dedicated to the Commonwealth of Virginia and all residential lots developed or to be developed. 2.2 ACQUISITION AND PHASE I DEVELOPMENT LOAN AND PHASE II DEVELOPMENT LOAN. I. ACQUISITION AND PHASE I DEVELOPMENT LOAN.

(b) ACCOUNTING TERMS AND DETERMINATIONS. Unless otherwise specified or provided herein, all accounting terms used herein shall be interpreted, all determinations with respect to accounting matters hereunder shall be made, and all financial statements and certificates and reports as to financial matters required to be delivered hereunder shall be prepared, in accordance with Generally Accepted Accounting Principles as in effect from time to time, applied on a Consistent Basis. (c) TERMS IN LOAN DOCUMENTS. All of the terms defined in this Agreement shall have such defined meanings when used in the Notes, the other Loan Documents, and any certificates, reports or other documents issued under or delivered pursuant to this Agreement unless the context shall require otherwise. SECTION 2. THE LOANS. 2.1 THE DEVELOPMENT. The Borrower proposes to develop a residential golf course community known as Brickshire. The Development will consist of an 18 hole golf course, related clubhouse and amenities, water and sewer system to be dedicated to New Kent County and road improvements to be dedicated to the Commonwealth of Virginia and all residential lots developed or to be developed. 2.2 ACQUISITION AND PHASE I DEVELOPMENT LOAN AND PHASE II DEVELOPMENT LOAN. I. ACQUISITION AND PHASE I DEVELOPMENT LOAN. (a) AMOUNT. Subject to the terms and conditions of this Agreement, the Lender hereby agrees to lend ("Acquisition and Phase I Development Loan") to the Borrower up to $9,200,000. Subject to the terms hereof, an initial amount equal to 50% of the actual direct purchase price of the Property (but not in excess of $1,981,880) will be available for advance at the closing of the purchase by the Borrower of the Property. The Borrower shall provide the other 50% of the purchase price of the Property at closing. No further advances of the Acquisition and Phase I Development Loan shall be made until the Borrower has advanced from its own funds no less than an additional $1,980,880 towards Land Development Costs for Phase I or Golf Course Improvements so that the total equity of the Borrower in the Development is at least $3,963,760 (the "Minimum Equity Requirement"). Notwithstanding anything to the contrary contained herein, the amount available to be borrowed by Borrower at any time after the initial advance at closing under the Acquisition and Phase I Development Loan will be determined by Lender from time to time based upon advance requests by the Borrower and the terms and conditions hereof. (b) ACQUISITION AND PHASE I DEVELOPMENT NOTE AND PURPOSE. The Acquisition and Phase I Development Loan shall be evidenced by the Acquisition and Phase I Development Note. The proceeds of the Acquisition and Phase I 7

Development Note shall be used by the Borrower solely for the purpose of (i) financing the Land Development Improvements and (ii) financing of up to 50% (but not in excess of $1,981,800) of the costs of land acquisition for the Property. The Borrower will make payments on the Acquisition and Phase I Development Note as provided in (e) below and Section 2.10. (c) RATE OF INTEREST. The principal balance outstanding under the Acquisition and Phase I Development Note shall bear interest at the per annum interest rate of the Lender's Prime Rate, as adjusted daily, plus one-half percent (.5%), to be adjusted effective as of the date of each change in the Prime Rate. (d) ORIGINATION FEE. The Borrower shall pay to the Lender on or prior to the date hereof an origination fee in connection with the Acquisition and Phase I Development Loan and Phase II Development Loan equal to $110,000. (e) REPAYMENT. Interest on the outstanding principal balance of the Acquisition and Phase I Development Note shall be due and payable monthly, commencing on October 24, 1999 and on the same day of each month thereafter, until the unpaid principal balance has been paid in full. The entire principal balance and all accrued unpaid interest under the Acquisition and Phase I Development Note shall be due and payable in full on January

Development Note shall be used by the Borrower solely for the purpose of (i) financing the Land Development Improvements and (ii) financing of up to 50% (but not in excess of $1,981,800) of the costs of land acquisition for the Property. The Borrower will make payments on the Acquisition and Phase I Development Note as provided in (e) below and Section 2.10. (c) RATE OF INTEREST. The principal balance outstanding under the Acquisition and Phase I Development Note shall bear interest at the per annum interest rate of the Lender's Prime Rate, as adjusted daily, plus one-half percent (.5%), to be adjusted effective as of the date of each change in the Prime Rate. (d) ORIGINATION FEE. The Borrower shall pay to the Lender on or prior to the date hereof an origination fee in connection with the Acquisition and Phase I Development Loan and Phase II Development Loan equal to $110,000. (e) REPAYMENT. Interest on the outstanding principal balance of the Acquisition and Phase I Development Note shall be due and payable monthly, commencing on October 24, 1999 and on the same day of each month thereafter, until the unpaid principal balance has been paid in full. The entire principal balance and all accrued unpaid interest under the Acquisition and Phase I Development Note shall be due and payable in full on January 31, 2004. The principal indebtedness evidenced by the Acquisition and Phase I Development Note shall be repayable as provided in Section 2.10 from (i) the proceeds of the sale of real estate in the Development and (ii) other funds provided by Borrower; provided that on or before the end of each calendar quarter, beginning the three-month calendar quarter ending April 30, 2002, principal on the Acquisition and Land Development Note shall be repaid on the Acquisition and Phase I Development Loan (the "Acquisition and Phase I Development Loan Minimum Installment") such that the outstanding principal balance of the Acquisition and Phase I Development Loan shall not exceed the following amounts at the following dates:
-------------------------- --------------------------DATE MAXIMUM PRINCIPAL BALANCE -------------------------- --------------------------4/30/02 $8,050,000 -------------------------- --------------------------7/31/02 $6,900,000 -------------------------- --------------------------10/30/02 $5,750,000 -------------------------- --------------------------1/31/03 $3,275,000 -------------------------- --------------------------4/30/03 $2,456,250 -------------------------- --------------------------7/31/03 $1,637,500 -------------------------- --------------------------10/30/03 $ 818,750 -------------------------- --------------------------1/31/04 $ 0 -------------------------- ---------------------------

8

In the event the Acquisition and Phase I Development Loan Minimum Installment shall not have been paid for any calendar quarter, the Lender shall, in its sole discretion and following expiration of any applicable cure period, have the right to declare an Event of Default. II. PHASE II DEVELOPMENT LOAN. (a) AMOUNT. Subject to the terms and conditions of this Agreement, the Lender hereby agrees to lend ("Phase II Development Loan") to the Borrower up to $6,550,000. Notwithstanding anything to the contrary contained

In the event the Acquisition and Phase I Development Loan Minimum Installment shall not have been paid for any calendar quarter, the Lender shall, in its sole discretion and following expiration of any applicable cure period, have the right to declare an Event of Default. II. PHASE II DEVELOPMENT LOAN. (a) AMOUNT. Subject to the terms and conditions of this Agreement, the Lender hereby agrees to lend ("Phase II Development Loan") to the Borrower up to $6,550,000. Notwithstanding anything to the contrary contained herein, the amount available to be borrowed by Borrower at any time under the Phase II Development Loan will be determined by Lender from time to time based upon advance requests by the Borrower and the terms and conditions hereof. (b) PHASE II DEVELOPMENT NOTE AND PURPOSE. The Phase II Development Loan shall be evidenced by the Phase II Development Note. The proceeds of the Phase II Development Note shall be used by the Borrower solely for the purpose of financing the Land Development Improvements to Phase II. The Borrower will make payments on the Phase II Development Note as provided in (e) below and Section 2.10. (c) RATE OF INTEREST. The principal balance outstanding under the Phase II Development Note shall bear interest at the per annum interest rate of the Lender's Prime Rate, as adjusted daily, plus one-half percent (.5%), to be adjusted effective as of the date of each change in the Prime Rate. (d) REPAYMENT. Interest on the outstanding principal balance of the Phase II Development Note shall be due and payable monthly, commencing on the date 30 days following the first advance under the Phase II Development Note and on the same day of each month thereafter, until the unpaid principal balance has been paid in full. The entire principal balance and all accrued unpaid interest under the Phase II Development Note shall be due and payable in full on January 31, 2004. The principal indebtedness evidenced by the Phase II Development Note shall be repayable as provided in Section 2.10 from (i) the proceeds of the sale of real estate in the Development and (ii) other funds provided by Borrower; provided that on or before the end of each calendar quarter, beginning the three-month calendar quarter ending April 30, 2002, principal on the Phase II Development Note shall be repaid on the Phase II Development Loan (the "Phase II Development Loan Minimum Installment") such that the outstanding principal balance of the Phase II Development Loan shall not exceed the following amounts on the following dates: 9
------------------ -----------------------------DATE MAXIMUM PRINCIPAL BALANCE ------------------ -----------------------------4/30/02 $5,731,250 ------------------ -----------------------------7/31/02 $4,912,500 ------------------ -----------------------------10/30/02 $4,093,750 ------------------ -----------------------------1/31/03 $3,275,000 ------------------ -----------------------------4/30/03 $2,456,250 ------------------ -----------------------------7/31/03 $1,637,500 ------------------ -----------------------------10/31/03 $ 818,750 ------------------ -----------------------------1/31/04 $ 0 ------------------ ------------------------------

------------------ -----------------------------DATE MAXIMUM PRINCIPAL BALANCE ------------------ -----------------------------4/30/02 $5,731,250 ------------------ -----------------------------7/31/02 $4,912,500 ------------------ -----------------------------10/30/02 $4,093,750 ------------------ -----------------------------1/31/03 $3,275,000 ------------------ -----------------------------4/30/03 $2,456,250 ------------------ -----------------------------7/31/03 $1,637,500 ------------------ -----------------------------10/31/03 $ 818,750 ------------------ -----------------------------1/31/04 $ 0 ------------------ ------------------------------

In the event the Phase II Development Loan Minimum Installment shall not have been paid for any calendar quarter, the Lender shall, in its sole discretion and following the expiration of any applicable cure period, have the right to declare an Event of Default. 2.3 CONDITIONS OF LENDER'S OBLIGATIONS TO MAKE DISBURSEMENTS UNDER THE ACQUISITION AND PHASE I DEVELOPMENT LOAN AND THE PHASE II DEVELOPMENT LOAN. (a) OBLIGATIONS TO MAKE ADVANCES. The Lender shall not be obligated to make loan disbursements until the conditions set forth in Section 5, and the following further conditions, shall have been satisfied: (1) The representations and warranties made in Section 4 hereof shall be true and correct in all material respects on and as of the date of the disbursement with the same effect as if made on such date and shall be so certified by the certification contained in the form of disbursement (the "Disbursement Request"); (2) No disbursements, after the first disbursement, of the Acquisition and Phase I Development Loan shall be made until the Borrower has used its own funds to pay at least $1,981,880 in costs of Land Development Improvements and Golf Course Improvements and Lender shall have received and approved a final detailed cost budget for Phase I; (3) No advances under the Phase II Development Loan shall be made until (i) at least 50% of the lots in Phase I have been sold, (ii) the outstanding principal balance of the Acquisition and Phase I Development Note has been reduced to $5,000,000 or less and (iii) Lender shall have received and approved based on its customary underwriting standards a detailed cost budget for Phase II. A lot will be deemed sold if the purchaser 10

has deposited in escrow at least 10% of the sales price and executed the Borrower's standard purchase contract in the form delivered and approved by Lender or, if the standard contract is not so executed, Borrower has delivered a signed contract accepted by Borrower and the Lender has reviewed and approved such contract; (4) As of the date of such disbursement, there shall be no Default under any of the Loan Documents or this Agreement; (5) The Lender shall have received a Disbursement Request signed by Borrower accompanied by such other documentation as the Lender may request with respect to the Land Development Improvements, including an

has deposited in escrow at least 10% of the sales price and executed the Borrower's standard purchase contract in the form delivered and approved by Lender or, if the standard contract is not so executed, Borrower has delivered a signed contract accepted by Borrower and the Lender has reviewed and approved such contract; (4) As of the date of such disbursement, there shall be no Default under any of the Loan Documents or this Agreement; (5) The Lender shall have received a Disbursement Request signed by Borrower accompanied by such other documentation as the Lender may request with respect to the Land Development Improvements, including an endorsement to the mortgage title insurance policy, or assurance satisfactory to Lender that such an endorsement will be issued, increasing the coverage to give effect to amount covered by the Disbursement Request and otherwise acceptable to Lender; (6) At the time of each disbursement the Lender is satisfied, based upon information from the inspection by Lender or its inspecting representative, with the progress of construction in accordance with the preliminary site plan or such other development plans satisfactory (based on its customary underwriting standards) to the Lender; (7) The Lender shall not be required to make more than one disbursement each month; (8) No disbursements under the Acquisition and Phase I Development Loan shall be made by the Lender after January 31, 2002. No disbursements under the Phase II Development Loan shall be made after the earlier of (x) the date 24 months following the first advance under the Phase II Development Loan or (y) January 31, 2003; and (9) The Lender shall have reviewed and approved (such approval not to be unreasonably withheld) all easements, restrictions, planned development restrictions and any agreements or conditions relating to the Development or Property. (b) DISBURSEMENT AMOUNT. Following receipt of a Disbursement Request, the Lender shall determine the amount of the disbursement it will make in accordance with the Cost Breakdown and in accordance with the following standards: (1) CONSTRUCTION WORK: As to construction work: (A) Loan disbursements for approved construction costs related to the Land Development Improvements in Phase I and Phase II 11

will be made on the basis of 100% of the approved cost, as shown on applications for payment from Borrower reviewed and approved by the Lender, minus the amount of previous loan disbursements with respect to Phase I or Phase II, as the case may be, and any required equity contributions therefor. (B) Unless otherwise approved by the Lender, the foregoing is subject to the proviso that disbursements will be made for costs incurred only up to the amount for such costs listed in the Cost Breakdown for the Phase I and Phase II, as the case may be. The Borrower shall be responsible for all costs and overruns associated with the Land Development Improvements. (2) MATERIALS: The Lender will not make loan disbursements based on the cost of materials to be incorporated into Improvements whether or not such materials are stored on the Development. (e) EXPENDITURES BY BORROWER RESPECTING DEVELOPMENT LOAN. If Lender at any time determines that the proceeds remaining to be disbursed in respect of the Land Development Improvements to be constructed are not sufficient to pay the cost of completion of the Land Development Improvements to be constructed with advances hereunder in accordance with the preliminary site plan or other development plan for such Land Development Improvements, Lender shall have the right to require Borrower to expend for the construction of such Land Development Improvements funds from some source other than Acquisition and Phase

will be made on the basis of 100% of the approved cost, as shown on applications for payment from Borrower reviewed and approved by the Lender, minus the amount of previous loan disbursements with respect to Phase I or Phase II, as the case may be, and any required equity contributions therefor. (B) Unless otherwise approved by the Lender, the foregoing is subject to the proviso that disbursements will be made for costs incurred only up to the amount for such costs listed in the Cost Breakdown for the Phase I and Phase II, as the case may be. The Borrower shall be responsible for all costs and overruns associated with the Land Development Improvements. (2) MATERIALS: The Lender will not make loan disbursements based on the cost of materials to be incorporated into Improvements whether or not such materials are stored on the Development. (e) EXPENDITURES BY BORROWER RESPECTING DEVELOPMENT LOAN. If Lender at any time determines that the proceeds remaining to be disbursed in respect of the Land Development Improvements to be constructed are not sufficient to pay the cost of completion of the Land Development Improvements to be constructed with advances hereunder in accordance with the preliminary site plan or other development plan for such Land Development Improvements, Lender shall have the right to require Borrower to expend for the construction of such Land Development Improvements funds from some source other than Acquisition and Phase I Development Loan or Phase II Development Loan, as the case may be, or any other loan from Lender to cover the deficit before Lender will disburse any additional Acquisition and Phase I Development Loan proceeds or Phase II Development Loan proceeds, as the case may be. (f) PAYMENTS TO GENERAL CONTRACTOR, ETC. RESPECTING DEVELOPMENT LOAN. Lender, on request of Borrower or upon the occurrence of an Event of Default hereunder, may make any and all disbursements under the Acquisition and Phase I Development Loan and Phase II Development Loan, as the case may be, directly to any general contractor or to any unpaid subcontractor, laborer or material supplier providing services, labor or materials in connection with construction of the Improvements. Upon the occurrence of an Event of Default, no further direction or authorization from Borrower shall be necessary to warrant such direct disbursements, and all such disbursements shall be secured by the Deed of Trust and other Loan Documents as fully as if made to Borrower and regardless of the disposition thereof by such general contractor, subcontractor, laborer or material supplier so paid. Borrower gives each general contractor, subcontractor, laborer and material supplier so paid the authority, at Lender's request and on behalf of Borrower, to sign a receipt for such disbursements stating that such disbursements are secured by the Deed of Trust and other Loan Documents. 12

2.4 GOLF COURSE LOAN. (a) AMOUNT. Subject to the terms and conditions of this Agreement, the Lender hereby agrees to lend ("Golf Course Loan") to the Borrower up to $4,200,000. Notwithstanding anything to the contrary contained herein, the amount available to be borrowed by Borrower at any time under the Golf Course Loan will be determined by Lender from time to time based upon advance requests by the Borrower and the terms and conditions hereof. (b) NOTE AND PURPOSE. The Golf Course Loan shall be evidenced by the Golf Course Note. The proceeds of the Golf Course Note shall be used by the Borrower solely for the purpose of financing the Golf Course Improvements, including the costs of constructing an 18 hole golf course, clubhouse and related amenities, all as further described in the Golf Course Plans and Specifications, to be owned by the Borrower and located in the Development. (c) RATE OF INTEREST. The principal balance outstanding under the Golf Course Note shall bear interest at the per annum interest rate of the Lender's Prime Rate, as adjusted daily, plus one-half percent (.5%), to be adjusted effective as of the date of each change in the Prime Rate. (d) REPAYMENT. Interest on the outstanding principal balance of the Golf Course Note shall be due and payable monthly on the 1st day of each month, commencing on November 1, 1999, and on the same day of each month thereafter, until the unpaid principal balance has been paid in full. The principal indebtedness evidenced by

2.4 GOLF COURSE LOAN. (a) AMOUNT. Subject to the terms and conditions of this Agreement, the Lender hereby agrees to lend ("Golf Course Loan") to the Borrower up to $4,200,000. Notwithstanding anything to the contrary contained herein, the amount available to be borrowed by Borrower at any time under the Golf Course Loan will be determined by Lender from time to time based upon advance requests by the Borrower and the terms and conditions hereof. (b) NOTE AND PURPOSE. The Golf Course Loan shall be evidenced by the Golf Course Note. The proceeds of the Golf Course Note shall be used by the Borrower solely for the purpose of financing the Golf Course Improvements, including the costs of constructing an 18 hole golf course, clubhouse and related amenities, all as further described in the Golf Course Plans and Specifications, to be owned by the Borrower and located in the Development. (c) RATE OF INTEREST. The principal balance outstanding under the Golf Course Note shall bear interest at the per annum interest rate of the Lender's Prime Rate, as adjusted daily, plus one-half percent (.5%), to be adjusted effective as of the date of each change in the Prime Rate. (d) REPAYMENT. Interest on the outstanding principal balance of the Golf Course Note shall be due and payable monthly on the 1st day of each month, commencing on November 1, 1999, and on the same day of each month thereafter, until the unpaid principal balance has been paid in full. The principal indebtedness evidenced by the Golf Course Note shall be repayable in equal monthly installments of $35,000 commencing September 1, 2001 and on the same day of each month thereafter. The entire principal balance and all accrued unpaid interest under the Golf Course Note shall be due and payable in full on October 1, 2005. (e) ORIGINATION FEE. The Borrower shall pay on or prior to the date hereof to Lender an origination fee in connection with the Golf Course Loan equal to $40,000. 2.5 CONDITIONS OF LENDER'S OBLIGATIONS TO MAKE DISBURSEMENTS UNDER THE GOLF COURSE LOAN. (a) OBLIGATIONS TO MAKE ADVANCES. The Lender shall not be obligated to make loan disbursements until the conditions set forth in Section 5, and the following further conditions, shall have been satisfied: (1) The representations and warranties made in Section 4 hereof shall be true and correct in all material respects on and as of the date of the disbursement with the same effect as if made on such date and shall be so 13

certified by the certification contained in the form of disbursement (the "Disbursement Request"); (2) Lender shall have received and approved based upon its customary underwriting standards a detailed cost budget for the Golf Course Improvements. (3) As of the date of such disbursement, there shall be no Default under any of the Loan Documents or this Agreement; (4) The Lender shall have received a Disbursement Request signed by Borrower accompanied, as applicable, with Architectural Documents G702 and G703; (5) At the time of each disbursement the Lender is satisfied, based upon information from the Architects and inspection by Lender or its inspecting representative, with the progress of construction in accordance with the Golf Course Plans and Specifications; (6) The Lender shall not be required to make more than one disbursement each month; (7) No disbursements under the Golf Course Loan shall be made until the Borrower has met the Minimum Equity Requirement of Section

certified by the certification contained in the form of disbursement (the "Disbursement Request"); (2) Lender shall have received and approved based upon its customary underwriting standards a detailed cost budget for the Golf Course Improvements. (3) As of the date of such disbursement, there shall be no Default under any of the Loan Documents or this Agreement; (4) The Lender shall have received a Disbursement Request signed by Borrower accompanied, as applicable, with Architectural Documents G702 and G703; (5) At the time of each disbursement the Lender is satisfied, based upon information from the Architects and inspection by Lender or its inspecting representative, with the progress of construction in accordance with the Golf Course Plans and Specifications; (6) The Lender shall not be required to make more than one disbursement each month; (7) No disbursements under the Golf Course Loan shall be made until the Borrower has met the Minimum Equity Requirement of Section 2.2 I(a). (8) No disbursements shall be made by the Lender after December 31, 2001. (b) DISBURSEMENT AMOUNT. Following receipt of a Disbursement Request, the Lender shall determine the amount of the disbursement it will make in accordance with the Cost Breakdown for the Golf Course Improvements and in accordance with the following standards: (1) CONSTRUCTION WORK: As to construction work: (A) Loan disbursements for approved construction costs and other costs related to the Golf Course Improvements will be made on the basis of 100% of the approved cost, as shown on applications for payment from Borrower reviewed and approved by the Lender, of work on the Golf Course Improvements, minus the amount of previous Golf Course Loan disbursements and any equity contributions therefor. (B) Unless otherwise approved by the Lender, the foregoing is subject to the proviso that disbursements will be made for costs 14

incurred only up to the amount for such costs listed in the Cost Breakdown for the Golf Course Improvements. (2) MATERIALS: The Lender will not make Golf Course Loan disbursements based on the cost of materials to be incorporated into Improvements whether or not such materials are stored on the Development. (e) EXPENDITURES BY BORROWER RESPECTING GOLF COURSE LOAN. If Lender at any time determines that the Golf Course Loan proceeds remaining to be disbursed in respect of the Golf Course Improvements to be constructed are not sufficient to pay the cost of completion of the Golf Course Improvements to be constructed with advances hereunder in accordance with the Golf Course Plans and Specifications for such improvements, Lender shall have the right to require Borrower to expend for the construction of such improvements funds from some source other than Golf Course Loan or any other loan from Lender to cover the deficit before Lender will disburse any additional Golf Course Loan proceeds. (f) PAYMENTS TO GENERAL CONTRACTOR, ETC. RESPECTING GOLF COURSE LOAN. Lender, on request of Borrower or upon the occurrence of an Event of Default hereunder, may make any and all Golf Course Loan disbursements directly to any general contractor or to any unpaid subcontractor, laborer or material supplier providing services, labor or materials in connection with construction of the Improvements. Upon the occurrence of an Event of Default, no further direction or authorization from Borrower shall be necessary to

incurred only up to the amount for such costs listed in the Cost Breakdown for the Golf Course Improvements. (2) MATERIALS: The Lender will not make Golf Course Loan disbursements based on the cost of materials to be incorporated into Improvements whether or not such materials are stored on the Development. (e) EXPENDITURES BY BORROWER RESPECTING GOLF COURSE LOAN. If Lender at any time determines that the Golf Course Loan proceeds remaining to be disbursed in respect of the Golf Course Improvements to be constructed are not sufficient to pay the cost of completion of the Golf Course Improvements to be constructed with advances hereunder in accordance with the Golf Course Plans and Specifications for such improvements, Lender shall have the right to require Borrower to expend for the construction of such improvements funds from some source other than Golf Course Loan or any other loan from Lender to cover the deficit before Lender will disburse any additional Golf Course Loan proceeds. (f) PAYMENTS TO GENERAL CONTRACTOR, ETC. RESPECTING GOLF COURSE LOAN. Lender, on request of Borrower or upon the occurrence of an Event of Default hereunder, may make any and all Golf Course Loan disbursements directly to any general contractor or to any unpaid subcontractor, laborer or material supplier providing services, labor or materials in connection with construction of the Improvements. Upon the occurrence of an Event of Default, no further direction or authorization from Borrower shall be necessary to warrant such direct disbursements, and all such disbursements shall be secured by the Deed of Trust and other Loan Documents as fully as if made to Borrower and regardless of the disposition thereof by such general contractor, subcontractor, laborer or material supplier so paid. Borrower gives each general contractor, subcontractor, laborer and material supplier so paid the authority, at Lender's request and on behalf of Borrower, to sign a receipt for such disbursements stating that such disbursements are secured by the Deed of Trust and other Loan Documents. 2.6 MANNER OF PAYMENT FOR ALL LOANS. Each payment of interest, principal (including any prepayment) and any other amount required to be paid to the Lender with respect to this Agreement, the Notes or pursuant to the Loan Documents, shall be made to the Lender at its principal office in Wilmington, North Carolina in dollars and in immediately available funds on or before 2:00 p.m., Wilmington, North Carolina time on the date such payment is due. In case any such payment is not so made when due, the Lender may, but shall not be obligated to, debit the amount of such payment from any one or more ordinary deposit accounts of Borrower with the Lender. 2.7 NON-CONFORMING PAYMENT. In the event that any payment of interest, principal of, prepayment or other fee, or other amount owing hereunder with respect to this Agreement, any of the Notes or pursuant to the Loan Documents, is not made 15

when due such amount shall continue as an obligation of the Borrower hereunder and shall bear interest from the due date thereof until paid in full in the manner provided in the immediately preceding paragraph at a rate of interest per annum equal to the Lender's Prime Rate plus four percent (4%) or the maximum rate permitted by applicable law, whichever shall be lower, from the date such amount was due until paid in full. Notwithstanding the foregoing, failure to make any payment when due following any applicable cure periods in the manner provided in the immediately preceding paragraph shall constitute an Event of Default hereunder. 2.8 PAYMENTS ON BUSINESS DAYS. In the event that any payment hereunder or under any of the Notes becomes due and payable on a day other than a Business Day, then such due date shall be extended to the next succeeding Business Day; provided that interest shall continue to accrue during the period of any such extension. 2.9 COMPUTATION OF INTEREST. Interest on the Notes shall be computed on the basis of a year of 360 days. Any change in the interest rate on the Notes resulting from a change in the Lender's Prime Rate shall become effective as of the opening of business on the date on which such change in the Lender's Prime Rate shall occur. 2.10 RELEASE OF LOTS AND APPLICATION OF NET SALES PROCEEDS. In connection with the sale of lots in the Development, the Lender shall receive, to be applied as provided herein, a percentage of the net

when due such amount shall continue as an obligation of the Borrower hereunder and shall bear interest from the due date thereof until paid in full in the manner provided in the immediately preceding paragraph at a rate of interest per annum equal to the Lender's Prime Rate plus four percent (4%) or the maximum rate permitted by applicable law, whichever shall be lower, from the date such amount was due until paid in full. Notwithstanding the foregoing, failure to make any payment when due following any applicable cure periods in the manner provided in the immediately preceding paragraph shall constitute an Event of Default hereunder. 2.8 PAYMENTS ON BUSINESS DAYS. In the event that any payment hereunder or under any of the Notes becomes due and payable on a day other than a Business Day, then such due date shall be extended to the next succeeding Business Day; provided that interest shall continue to accrue during the period of any such extension. 2.9 COMPUTATION OF INTEREST. Interest on the Notes shall be computed on the basis of a year of 360 days. Any change in the interest rate on the Notes resulting from a change in the Lender's Prime Rate shall become effective as of the opening of business on the date on which such change in the Lender's Prime Rate shall occur. 2.10 RELEASE OF LOTS AND APPLICATION OF NET SALES PROCEEDS. In connection with the sale of lots in the Development, the Lender shall receive, to be applied as provided herein, a percentage of the net proceeds from such sale received. The release of lots and application of proceeds shall be as follows: (a) LOT RELEASE. In connection with the sale of lots to persons not affiliated with the Borrower, the Lender shall grant a release of property from the lien of the Deed of Trust upon the delivery to the Lender of an amount (the "Release Payment") equal to the Minimum Release Payment as shown on SCHEDULE 2.10 for such lots. In connection with the sale of lots to persons affiliated with the Borrower, the terms upon which the Lender will release the lien of the Deed of Trust will be determined by the Lender at the time of such sale. Release Payments relating to lots in Phase I shall be applied to the Acquisition and Phase I Development Loan until such loan is paid in full. Release Payments relating to lots in Phase II shall be applied to the Phase II Development Loan until such loan is paid in full. After the Acquisition and Phase I Development Loan is paid in full, Release Payments relating to Phase I lots shall be applied to the Phase II Loan. After the Phase II Loan is paid in full, Release Payments relating to Phase II lots shall be applied to the Acquisition and Phase I Development Loan. After both such loans have been paid in full, Release Payments shall be applied as mutually agreed upon between Borrower and Lender. Release Payments received prior to April 30, 16

2002 shall be applied cumulatively towards the required quarterly minimum installments set forth in Sections 2.2 I (e) and 2.2 II(d). (b) COMMON AREA RELEASE. Subject to the Lender's prior approval of the location of the property to be released, the Lender will grant a release of property from the lien of the Deed of Trust, without monetary consideration, for any Common Property conveyed by the Borrower to any homeowner's association related to the Development and for roadway and water and sewer improvements which are dedicated to New Kent County, Virginia or the Commonwealth of Virginia. For purposes of this paragraph, Common Property shall include any property shown on a recorded plat of the Development as "common area" or "common property" or "public streets" or designated as such in any other document and conveyed to a homeowner's association consisting of owners of property in the Development. 2.11 PREPAYMENT. The Borrower may prepay the indebtedness evidenced by any of the Note in whole or in part at any time and from time to time without penalty. SECTION 3. SECURITY. As security for the full and timely payment of the principal of and interest on the Notes and all other Obligations, whether now existing or hereafter arising under the Loan Documents or otherwise, the Borrower shall: (a) on the Closing Date or prior to any disbursements under the Acquisition and Phase I Development Loan:

2002 shall be applied cumulatively towards the required quarterly minimum installments set forth in Sections 2.2 I (e) and 2.2 II(d). (b) COMMON AREA RELEASE. Subject to the Lender's prior approval of the location of the property to be released, the Lender will grant a release of property from the lien of the Deed of Trust, without monetary consideration, for any Common Property conveyed by the Borrower to any homeowner's association related to the Development and for roadway and water and sewer improvements which are dedicated to New Kent County, Virginia or the Commonwealth of Virginia. For purposes of this paragraph, Common Property shall include any property shown on a recorded plat of the Development as "common area" or "common property" or "public streets" or designated as such in any other document and conveyed to a homeowner's association consisting of owners of property in the Development. 2.11 PREPAYMENT. The Borrower may prepay the indebtedness evidenced by any of the Note in whole or in part at any time and from time to time without penalty. SECTION 3. SECURITY. As security for the full and timely payment of the principal of and interest on the Notes and all other Obligations, whether now existing or hereafter arising under the Loan Documents or otherwise, the Borrower shall: (a) on the Closing Date or prior to any disbursements under the Acquisition and Phase I Development Loan: (i) deliver to the Lender the Security Agreement, Deed of Trust and the other Loan Documents; and (ii) deliver to the Lender Uniform Commercial Code Financing Statements properly executed for filing in the appropriate places to perfect the Lender's security interest under the Security Agreement, Deed of Trust and other Loan Documents; and (b) prior to any disbursements under the Golf Course Loan for Golf Course Improvements: (i) deliver to the Lender the Architects' Collateral Assignment and Contractor's Collateral Assignment; and (ii) deliver to the Lender Uniform Commercial Code Financing Statements properly executed for filing in the appropriate places to perfect the Lender's security interest under the Loan Documents. 17

SECTION 4. REPRESENTATIONS AND WARRANTIES. In order to induce the Lender to enter into this Agreement and to make the loans herein provided for, Borrower represents and warrants to the Lender as follows: 4.1 ORGANIZATION, ETC. Borrower is a corporation duly organized, validly existing and in good standing under the laws of the State of Delaware and a wholly owned subsidiary of Guarantor; the Borrower is in good standing and duly qualified to transact business in the State of Virginia and has the requisite power to own its properties and to carry on its business as now being conducted. 4.2 POWER AND AUTHORITY. Borrower is duly authorized under all applicable provisions of law to execute, deliver and perform this Agreement, the Notes and the other Loan Documents, and all corporate action on the part of the Borrower required for the lawful execution, delivery and performance thereof has been duly taken; and each of the Loan Documents upon the due execution and delivery thereof, will be the valid and enforceable instrument, obligation or agreement of the Borrower, in accordance with its respective terms, except as enforceability may be limited by applicable bankruptcy, insolvency, reorganization, moratorium and similar laws affecting generally the enforcement of creditor's rights and by such principles of equity as may generally affect the availability of equitable remedies. Neither the execution of the Loan Documents, nor the fulfillment of or compliance with their provisions and terms, will constitute a violation of or default under, or conflict with or result in a breach of, the terms, conditions or provisions of any agreement or instrument to which Borrower is a party or the Bylaws or Articles of Incorporation of Borrower or any law, regulation, writ or decree applicable to Borrower, or create any lien, charge or encumbrance upon any of the property or assets of Borrower pursuant to

SECTION 4. REPRESENTATIONS AND WARRANTIES. In order to induce the Lender to enter into this Agreement and to make the loans herein provided for, Borrower represents and warrants to the Lender as follows: 4.1 ORGANIZATION, ETC. Borrower is a corporation duly organized, validly existing and in good standing under the laws of the State of Delaware and a wholly owned subsidiary of Guarantor; the Borrower is in good standing and duly qualified to transact business in the State of Virginia and has the requisite power to own its properties and to carry on its business as now being conducted. 4.2 POWER AND AUTHORITY. Borrower is duly authorized under all applicable provisions of law to execute, deliver and perform this Agreement, the Notes and the other Loan Documents, and all corporate action on the part of the Borrower required for the lawful execution, delivery and performance thereof has been duly taken; and each of the Loan Documents upon the due execution and delivery thereof, will be the valid and enforceable instrument, obligation or agreement of the Borrower, in accordance with its respective terms, except as enforceability may be limited by applicable bankruptcy, insolvency, reorganization, moratorium and similar laws affecting generally the enforcement of creditor's rights and by such principles of equity as may generally affect the availability of equitable remedies. Neither the execution of the Loan Documents, nor the fulfillment of or compliance with their provisions and terms, will constitute a violation of or default under, or conflict with or result in a breach of, the terms, conditions or provisions of any agreement or instrument to which Borrower is a party or the Bylaws or Articles of Incorporation of Borrower or any law, regulation, writ or decree applicable to Borrower, or create any lien, charge or encumbrance upon any of the property or assets of Borrower pursuant to the terms of any agreement or instrument to which Borrower is a party or by which it is bound. 4.3 FINANCIAL CONDITION. The financial information, including financial statements, of the Borrower delivered to the Lender, present fairly the financial condition of the Borrower as at the date of said information. Borrower has no direct or contingent liabilities as of the date of this Agreement of a nature required by Generally Accepted Accounting Principles to be reflected or provided for in financial statements which are not provided for or reflected in such financial statements. Since the date of said financial information, there has been no material adverse change in the business, properties or condition, financial or otherwise, of Borrower. 4.4 TITLE TO ASSETS. Borrower has good and, with respect to real property insurable, title to its properties and assets, including the properties and assets reflected in the financial statements and notes thereto described in Section 4.3, except for such assets as have been disposed of in the ordinary course of business, and all such properties and assets are free and clear of all liens, mortgages, pledges, encumbrances or charges of any kind except as described in such financial statements and notes thereto, Permitted Encumbrances and the exceptions contained in the title insurance 18

policy delivered to Lender in connection with this Agreement (the "Permitted Exceptions"). 4.5 LITIGATION. There are no pending or, to the knowledge of Borrower, threatened actions or proceedings before any court, arbitrator or governmental or administrative body or agency which may reasonably be expected to materially adversely affect the properties, business or condition, financial or otherwise, of Borrower, the completion of the Improvements or the sale of lots or acreage in the Development, or in any way adversely affect or call into question the power or authority of Borrower to enter into or perform any of the Loan Documents to which it is a party. 4.6 LOCATIONS. The address of Borrower's principal place of business, is set forth below. All the equipment and other personal property covered by the Security Agreement will be located at the following Collateral location. All records and other information with respect to accounts, inventory, equipment and other personal property (including computer programs and printouts) covered by the Security Agreement are maintained by the Borrower at the following Collateral location:
BORROWER'S PRINCIPAL PLACES OF BUSINESS --------------------------------------6201 N. Courthouse Road LOCATIONS OF COLLATERAL ----------------------New Kent County, Virginia

policy delivered to Lender in connection with this Agreement (the "Permitted Exceptions"). 4.5 LITIGATION. There are no pending or, to the knowledge of Borrower, threatened actions or proceedings before any court, arbitrator or governmental or administrative body or agency which may reasonably be expected to materially adversely affect the properties, business or condition, financial or otherwise, of Borrower, the completion of the Improvements or the sale of lots or acreage in the Development, or in any way adversely affect or call into question the power or authority of Borrower to enter into or perform any of the Loan Documents to which it is a party. 4.6 LOCATIONS. The address of Borrower's principal place of business, is set forth below. All the equipment and other personal property covered by the Security Agreement will be located at the following Collateral location. All records and other information with respect to accounts, inventory, equipment and other personal property (including computer programs and printouts) covered by the Security Agreement are maintained by the Borrower at the following Collateral location:
BORROWER'S PRINCIPAL PLACES OF BUSINESS --------------------------------------6201 N. Courthouse Road New Kent, Virginia 23124 or 4960 Blue Lake Drive Boca Raton, Florida 33431 LOCATIONS OF COLLATERAL ----------------------New Kent County, Virginia Richmond County, Virginia Palm Beach County, Florida

4.7 TAXES. Borrower has filed all income tax returns required to be filed by it and all taxes shown thereon have been paid, and no controversy in respect of additional income taxes, state, federal or foreign, of Borrower is pending, or, to the knowledge of Borrower, threatened. 4.8 CONTRACT OR RESTRICTION AFFECTING THE BORROWER. Borrower is not a party to or bound by any contract or agreement or subject to any provisions of its Bylaws or Articles of Incorporation or other corporate restrictions, which materially adversely affect the business, properties or condition, financial or otherwise, of Borrower. 4.9 TRADEMARKS, FRANCHISES AND LICENSES. Borrower owns, possesses, or has the right to use all necessary patents, licenses, franchises, trademarks, trademark rights, trade names, trade name rights and copyrights to conduct its business as now conducted, without known conflict with any patent, license, franchise, trademark, trade name, or copyright of any other Person. 4.10 NO DEFAULT. Borrower is not in default in the performance, observance or fulfillment of any of the obligations, covenants or conditions contained in any 19

agreement or instrument to which it is a party relating to any Indebtedness for Money Borrowed, the effect of which default would cause such obligation under the agreement or instrument to become due prior to its stated maturity. 4.11 GOVERNMENTAL AUTHORITY. No written approval of any foreign, federal, state or local governmental authorities is necessary to enter into and to carry out the terms of the Loan Documents except for customary development approvals, and no consents or approvals are required in connection with the making or Borrower's performance of the Loan Documents. The Borrower has received or will obtain the written approval or permits from all federal, state and local governmental authorities necessary to construct the Improvements, to conduct its operations as presently conducted and to operate the Development as a golf course and residential development. All laws, regulations and procedures applicable to the Borrower with respect to the Development, including, without limitation, environmental, licensing, wetlands, endangered species and environmental and all notification and approval procedures, have been or will be complied with at all times.

agreement or instrument to which it is a party relating to any Indebtedness for Money Borrowed, the effect of which default would cause such obligation under the agreement or instrument to become due prior to its stated maturity. 4.11 GOVERNMENTAL AUTHORITY. No written approval of any foreign, federal, state or local governmental authorities is necessary to enter into and to carry out the terms of the Loan Documents except for customary development approvals, and no consents or approvals are required in connection with the making or Borrower's performance of the Loan Documents. The Borrower has received or will obtain the written approval or permits from all federal, state and local governmental authorities necessary to construct the Improvements, to conduct its operations as presently conducted and to operate the Development as a golf course and residential development. All laws, regulations and procedures applicable to the Borrower with respect to the Development, including, without limitation, environmental, licensing, wetlands, endangered species and environmental and all notification and approval procedures, have been or will be complied with at all times. 4.12 REGULATION U. No part of the proceeds of the loans made pursuant to this Agreement will be or has been used to purchase or carry or to reduce or retire any loan incurred to purchase or carry, any margin stocks (within the meaning of Regulation U of the Board of Governors of the Federal Reserve System) or to extend credit to others for the purpose of purchasing or carrying any such margin stocks. Borrower is not engaged as one of its important activities in extending credit for the purpose of purchasing or carrying such margin stocks. If requested by the Lender, the Borrower will furnish to the Lender in connection with the loans hereunder, a statement in conformance with the requirements of Federal Reserve Form U-1 referred to in said Regulation. No part of the proceeds of the loans provided for hereunder will be used for the purchase of commodity future contracts (or margins therefor for short sales) or for any commodity not required for the normal raw materials inventory of Borrower. 4.13 ERISA REQUIREMENTS. Borrower has not incurred any material accumulated funding deficiency within the meaning of ERISA, or incurred any material liability to the Pension Benefit Guaranty Corporation established under ERISA (or any successor thereto under ERISA) in connection with any employee pension benefit plan established by it or by any Person under common control with it (within the meaning of the Code or Section 4001 (b) of ERISA), or in any plan in which its employees are entitled to participate. No Reportable Event (as defined in ERISA) in connection with any such plan has occurred or is occurring. 4.14 NO UNTRUE STATEMENTS. Neither this Agreement nor any other Loan Documents, agreements, reports, schedules, certificates or instruments heretofore or simultaneously with the execution of this Agreement delivered to the Lender by or on behalf of Borrower contains any misrepresentation or untrue statement of a material fact or omits to state any material fact necessary to make any of such agreements, 20

reports, schedules, certificates or instruments, in the light of the circumstances under which they were made or delivered, not misleading. 4.15 HAZARDOUS MATERIALS. (i) Neither the Borrower nor, to its knowledge, any other Person has ever caused or permitted any Hazardous Materials to be placed, held, located or disposed of on, under or at the Property, nor has the Property or any part thereof ever been used (whether by the Borrower or, to its knowledge, by any Person) as a dump site or storage site (whether permanent or temporary) for any Hazardous Materials (except for storage of Hazardous Materials for on site use in accordance with applicable Environmental Laws, if any); (ii) the Borrower has fully disclosed to Lender in writing the existence, extent and nature of any Hazardous Materials which the Borrower is legally authorized and empowered to maintain on, in or under the Property or use in connection therewith, and the Borrower has obtained and will maintain all licenses, permits and approvals required with respect thereto, and is in full compliance with all of the terms, conditions and requirements of such licenses, permits and approvals; and (iii) to the Borrower's knowledge, the Property is now in full compliance with all Environmental Laws in effect on the date hereof. As used herein "knowledge" means actual knowledge of Tom Goss or Ron Foster or knowledge derived from environmental reports and studies provided to Borrower. 4.16 SUFFICIENCY OF LOANS. The Acquisition and Phase I Development Loan will be sufficient, together

reports, schedules, certificates or instruments, in the light of the circumstances under which they were made or delivered, not misleading. 4.15 HAZARDOUS MATERIALS. (i) Neither the Borrower nor, to its knowledge, any other Person has ever caused or permitted any Hazardous Materials to be placed, held, located or disposed of on, under or at the Property, nor has the Property or any part thereof ever been used (whether by the Borrower or, to its knowledge, by any Person) as a dump site or storage site (whether permanent or temporary) for any Hazardous Materials (except for storage of Hazardous Materials for on site use in accordance with applicable Environmental Laws, if any); (ii) the Borrower has fully disclosed to Lender in writing the existence, extent and nature of any Hazardous Materials which the Borrower is legally authorized and empowered to maintain on, in or under the Property or use in connection therewith, and the Borrower has obtained and will maintain all licenses, permits and approvals required with respect thereto, and is in full compliance with all of the terms, conditions and requirements of such licenses, permits and approvals; and (iii) to the Borrower's knowledge, the Property is now in full compliance with all Environmental Laws in effect on the date hereof. As used herein "knowledge" means actual knowledge of Tom Goss or Ron Foster or knowledge derived from environmental reports and studies provided to Borrower. 4.16 SUFFICIENCY OF LOANS. The Acquisition and Phase I Development Loan will be sufficient, together with any funds to be provided by the Borrower as shown in the Cost Breakdown, to complete the Improvements in accordance with the Plans and Specifications for Phase I and development plans for Phase I provided by Borrower to Lender. The Phase II Development Loan will be sufficient, together with any funds to be provided by the Borrower as shown in the Cost Breakdown, to complete the Improvements in accordance with the Plans and Specifications for Phase II and development plans for Phase II provided by Borrower to Lender. The Golf Course Loan will be sufficient, together with any funds to be provided by the Borrower as shown on the Cost Breakdown, to complete the Golf Course Improvements in accordance with the Golf Course Plans and Specifications provided by Borrower to Lender. 4.17 UTILITIES AND ACCESS. There are sufficient water, sewer, electricity and other utilities available to be provided to the Development to permit its operation as a residential real estate community with amenities such as the Improvements and each owner of a lot or other acreage will have access via public streets which will be Common Property to a public right of way. 4.18 RESTRICTIVE COVENANTS. There are no existing covenants, conditions and restrictions affecting the Development except as shown on SCHEDULE 4.18. The Borrower believes that such covenants, conditions and restrictions will not, in the aggregate, materially adversely affect the Borrower's proposed development of the Property. 21

4.19 YEAR 2000 COMPLIANT. The Borrower has (i) initiated a review and assessment of all areas within its business and operations that could be adversely affected by the "Year 2000 Problem" (that is, the risk that computer applications used by the Borrower may be unable to recognize and perform properly date-sensitive functions involving certain dates prior to and any date after December 31, 1999), (ii) developed a plan and time line for addressing the Year 2000 Problem on a timely basis, and (iii) to date, implemented that plan in accordance with that timetable. Based on the foregoing, the Borrower believes that all computer applications that are material to its business and operations are reasonably expected on a timely basis to be able to perform properly date-sensitive functions for all dates before and after January 1, 2000 (that is, be "Year 2000 Compliant"), except to the extent that a failure to do so could not reasonably be expected to have material adverse effect on the Borrower's business, operations or financial condition. SECTION 5. CONDITIONS OF CLOSING. The obligation of the Lender to make the loans hereunder is subject to the continuing accuracy of all representations and warranties with respect to the Borrower contained herein and in the other Loan Documents and the performance of all agreements by the Borrower contained herein and therein, including the following: 5.1 LEGAL OPINIONS. On the Closing Date, the Lender shall have received the favorable opinion addressed to the Lender, in form and substance satisfactory to the Lender and special counsel for the Lender, of Hirschler,

4.19 YEAR 2000 COMPLIANT. The Borrower has (i) initiated a review and assessment of all areas within its business and operations that could be adversely affected by the "Year 2000 Problem" (that is, the risk that computer applications used by the Borrower may be unable to recognize and perform properly date-sensitive functions involving certain dates prior to and any date after December 31, 1999), (ii) developed a plan and time line for addressing the Year 2000 Problem on a timely basis, and (iii) to date, implemented that plan in accordance with that timetable. Based on the foregoing, the Borrower believes that all computer applications that are material to its business and operations are reasonably expected on a timely basis to be able to perform properly date-sensitive functions for all dates before and after January 1, 2000 (that is, be "Year 2000 Compliant"), except to the extent that a failure to do so could not reasonably be expected to have material adverse effect on the Borrower's business, operations or financial condition. SECTION 5. CONDITIONS OF CLOSING. The obligation of the Lender to make the loans hereunder is subject to the continuing accuracy of all representations and warranties with respect to the Borrower contained herein and in the other Loan Documents and the performance of all agreements by the Borrower contained herein and therein, including the following: 5.1 LEGAL OPINIONS. On the Closing Date, the Lender shall have received the favorable opinion addressed to the Lender, in form and substance satisfactory to the Lender and special counsel for the Lender, of Hirschler, Fleischer, Weinberg, Cox & Allen and in-house counsel for the Guarantor, as counsel for the Borrower and Guarantor, as to the legal matters specified in EXHIBIT 6 hereto. 5.2 CLOSING DOCUMENTS. The Borrower shall deliver to Lender, in form and substance satisfaction to the Lender, on or prior to the date of the first advance under the Acquisition and Phase I Development Loan or the date otherwise specified below: (a) LOAN DOCUMENTS. Fully executed copies of this Agreement, the Notes, each of the other Loan Documents and UCC-1 Financing Statements relating to fixtures and personal property covered by the Loan Documents. If it shall so request, the Lender shall have received evidence of the filing of financing statements or other filings relating to any fixtures covered by the Loan Documents; (b) RESOLUTIONS. Resolutions, certified by the Secretary of Borrower as of the Closing Date, of Borrower's Board of Directors and Shareholders and the Guarantor's Board of Directors authorizing and approving the execution and delivery of the Loan Documents to which each is a party and the performance of the transactions contemplated thereby; (c) ARTICLES OF INCORPORATION AND BYLAWS. A copy of Borrower's and Guarantor's Articles of Incorporation (certified by the Secretary of State of its 22

incorporating jurisdiction) and Bylaws certified by the Secretary or Assistant Secretary of Borrower and Guarantor to be true and correct copies as currently in effect; (d) CERTIFICATE OF GOOD STANDING. Certificate of the Secretary of State of Massachusetts (as to Guarantor), Virginia (as to Borrower) and Delaware (as to Borrower) issued as of a recent date as to the existence and good standing of Borrower, as applicable; (e) INSURANCE. Evidence of insurance in form and amounts satisfactory to the Lender, and meeting the requirements of Section 6.4 hereof and the Loan Documents; (f) APPRAISALS. On or prior to the second advance under the Acquisition and Phase I Development Loan and prior to any advance under the Phase II Development Loan and Golf Course Loan, appraisals (excluding the Golf Course) which meet all applicable banking law requirements and are from an appraiser satisfactory to the Lender and which indicate (i) an appraised value, on a discounted cash flow basis, of no less than $20,000,000 with respect to the Development (excluding the Golf Course) and (ii) an appraised value, as built, of no less than $5,250,000 with respect to the Golf Course;

incorporating jurisdiction) and Bylaws certified by the Secretary or Assistant Secretary of Borrower and Guarantor to be true and correct copies as currently in effect; (d) CERTIFICATE OF GOOD STANDING. Certificate of the Secretary of State of Massachusetts (as to Guarantor), Virginia (as to Borrower) and Delaware (as to Borrower) issued as of a recent date as to the existence and good standing of Borrower, as applicable; (e) INSURANCE. Evidence of insurance in form and amounts satisfactory to the Lender, and meeting the requirements of Section 6.4 hereof and the Loan Documents; (f) APPRAISALS. On or prior to the second advance under the Acquisition and Phase I Development Loan and prior to any advance under the Phase II Development Loan and Golf Course Loan, appraisals (excluding the Golf Course) which meet all applicable banking law requirements and are from an appraiser satisfactory to the Lender and which indicate (i) an appraised value, on a discounted cash flow basis, of no less than $20,000,000 with respect to the Development (excluding the Golf Course) and (ii) an appraised value, as built, of no less than $5,250,000 with respect to the Golf Course; (g) SURVEY AND FLOOD PLAIN CERTIFICATION. A survey of the Development and the real property on which Phase I, Phase II and the Golf Course will be located, each in form and substance satisfactory to the Lender. The Borrower will also provide a survey and legal description of the Property. Such survey shall show all boundaries of such tract, together with all easements, with all courses and distances indicated so as to provide a metes and bounds description, and shall show dimensions and locations of all existing improvements. The surveyor shall provide a certification as to the location of the tract on which the Improvements are to be located within any "special flood hazard" area within the meaning of the Federal Flood Disaster Protection Act of 1973; (h) ENVIRONMENTAL SURVEYS. A phase-1 level environmental assessment with respect to the Property acceptable in form, scope, detail, analysis and results to the Lender and from an environmental engineering firm acceptable to the Lender, indicating no environmental conditions not acceptable to the Lender; (i) WETLANDS AND ENDANGERED SPECIES CERTIFICATION. By November 1, 1999 and, in any event, on or prior to the second advance under the Acquisition and Phase I Development Loan and prior to any advance under the Phase II Development Loan and Golf Course Loan, the Borrower shall 23

have provided the Lender with an environmental assessment from the Army Corps of Engineers and all required approvals from the appropriate state and local environmental authorities in form, scope, detail, analysis and results satisfactory to the Lender or the Lender shall have received satisfaction that there are no "endangered species" concerns affecting the location and construction of the Improvements and that the location of the Improvements will not violate, or require any consent under, any applicable wetlands laws and regulations; (j) TITLE INSURANCE POLICY. A mortgagee title insurance policy from a title insurance company satisfactory to the Lender, indicating the lien of the Deed of Trust is of first lien priority (insuring all easements), providing coverage for the full principal amount of the Notes, containing endorsements to coverage acceptable to the Lender and containing no title exceptions not approved by the Lender; (k) COST BREAKDOWN; PROJECTIONS. On or prior to the second advance under the Acquisition and Phase I Development Loan and prior to any advance under the Phase II Development Loan and Golf Course Loan, a copy of the Cost Breakdown for each of Phase I and Phase II Land Improvements and the Golf Course certified by an officer of Borrower showing all costs, including interest and fees, required to construct and complete such improvements in form satisfactory to the Lender and Final Projections for the Development (including golf course operations, lot sales and timing of cash flows) certified by an officer of Borrower and satisfactory to Lender; (l) COMPLIANCE WITH LAWS. If requested by Lender, a Certificate of Borrower that the Development and Improvements, and the intended uses of the Development and all Improvements, are in compliance with all applicable laws, regulations and ordinances. The laws, regulations and ordinances with which compliance should

have provided the Lender with an environmental assessment from the Army Corps of Engineers and all required approvals from the appropriate state and local environmental authorities in form, scope, detail, analysis and results satisfactory to the Lender or the Lender shall have received satisfaction that there are no "endangered species" concerns affecting the location and construction of the Improvements and that the location of the Improvements will not violate, or require any consent under, any applicable wetlands laws and regulations; (j) TITLE INSURANCE POLICY. A mortgagee title insurance policy from a title insurance company satisfactory to the Lender, indicating the lien of the Deed of Trust is of first lien priority (insuring all easements), providing coverage for the full principal amount of the Notes, containing endorsements to coverage acceptable to the Lender and containing no title exceptions not approved by the Lender; (k) COST BREAKDOWN; PROJECTIONS. On or prior to the second advance under the Acquisition and Phase I Development Loan and prior to any advance under the Phase II Development Loan and Golf Course Loan, a copy of the Cost Breakdown for each of Phase I and Phase II Land Improvements and the Golf Course certified by an officer of Borrower showing all costs, including interest and fees, required to construct and complete such improvements in form satisfactory to the Lender and Final Projections for the Development (including golf course operations, lot sales and timing of cash flows) certified by an officer of Borrower and satisfactory to Lender; (l) COMPLIANCE WITH LAWS. If requested by Lender, a Certificate of Borrower that the Development and Improvements, and the intended uses of the Development and all Improvements, are in compliance with all applicable laws, regulations and ordinances. The laws, regulations and ordinances with which compliance should be evidenced include, without limitation, the following: health and environmental protection laws, erosion control ordinance, doing business and/or licensing laws and zoning laws (the evidence submitted as to zoning should include the zoning designation made for the Development, the permitted uses of the Development under such zoning designations and zoning requirements as to parking, lot size, ingress, egress and building setbacks); (m) REPRESENTATIONS AND WARRANTIES. With each disbursement request, a statement, which may be contained in the written disbursement form, to the effect that all representations and warranties of the Borrower contained herein or in any document or certificate furnished to the Lender in connection herewith shall be true and correct; 24

(n) NO DEFAULT. Evidence that no uncured Event of Default, as hereafter defined, nor any event which, upon notice or lapse of time, or both, would constitute an Event of Default, exists; (o) TRANSACTION COSTS. Payment or arrangements satisfactory to the Lender for the payment, to the Lender (or the person or entity owed an amount in connection with this transaction) of all costs and expenses, including Lender's attorneys' fees, and taxes relating to the execution and delivery of this Agreement and the transactions contemplated thereby and the arrangements therefor; (p) UTILITIES. On or prior to the second advance under the Acquisition and Phase I Development Loan and prior to any advance under the Phase II Development Loan and Golf Course Loan, evidence of the availability and suitability of electric, water, sewer and other utilities needed to properly service the Development and Improvements for their intended use; (q) CONSTRUCTION AND PERFORMANCE BONDS. On or prior to the second advance under the Acquisition and Phase I Development Loan and prior to any advance under the Phase II Development Loan and Golf Course Loan, the Lender shall have approved the general contractor and, if required by Lender, all subcontractors involved in the Development and, if reasonably deemed necessary by Lender, the Lender shall receive evidence that the Borrower has been provided with performance bonds and labor and material bonds as to such contractors as may be required by the Lender in such amounts sufficient in the discretion of the Lender to cover the amounts of the construction contracts for the construction of their respective portions of the Improvements, and the surety issuing such bonds must also be acceptable to the Lender. The Lender shall be named as additional obligee on such bonds;

(n) NO DEFAULT. Evidence that no uncured Event of Default, as hereafter defined, nor any event which, upon notice or lapse of time, or both, would constitute an Event of Default, exists; (o) TRANSACTION COSTS. Payment or arrangements satisfactory to the Lender for the payment, to the Lender (or the person or entity owed an amount in connection with this transaction) of all costs and expenses, including Lender's attorneys' fees, and taxes relating to the execution and delivery of this Agreement and the transactions contemplated thereby and the arrangements therefor; (p) UTILITIES. On or prior to the second advance under the Acquisition and Phase I Development Loan and prior to any advance under the Phase II Development Loan and Golf Course Loan, evidence of the availability and suitability of electric, water, sewer and other utilities needed to properly service the Development and Improvements for their intended use; (q) CONSTRUCTION AND PERFORMANCE BONDS. On or prior to the second advance under the Acquisition and Phase I Development Loan and prior to any advance under the Phase II Development Loan and Golf Course Loan, the Lender shall have approved the general contractor and, if required by Lender, all subcontractors involved in the Development and, if reasonably deemed necessary by Lender, the Lender shall receive evidence that the Borrower has been provided with performance bonds and labor and material bonds as to such contractors as may be required by the Lender in such amounts sufficient in the discretion of the Lender to cover the amounts of the construction contracts for the construction of their respective portions of the Improvements, and the surety issuing such bonds must also be acceptable to the Lender. The Lender shall be named as additional obligee on such bonds; (r) PLANS AND SPECIFICATIONS. On or prior to the second advance under the Acquisition and Phase I Development Loan a copy of the Plans and Specifications and preliminary site plan or other development plan for the Improvements for Phase I and prior to any advance under the Phase II Development Loan and Golf Course Loan, a copy of the Plans and Specifications and preliminary site plan or other development plan for the Improvements for Phase II or the Golf Course Improvements, as the case may be, each in form satisfactory to the Lender, based upon Lender's customary underwriting standards (and the Borrower agrees that no material changes will be made in the Plans and Specifications without the prior written consent of the Lender) and which have been approved in writing by the Borrower either by initialing same or by other written approval identifying all pages and dates, including revision dates. Such plans and specifications shall include architectural, structural, mechanical, plumbing, electrical and site development 25

(including storm drainage, utility lines, erosion control and landscaping) plans and specifications; (s) PERMITS. On or prior to the second advance under the Acquisition and Phase I Development Loan and prior to any advance under the Phase II Development Loan and Golf Course Loan, copies of all material permits required to complete construction of the Improvements respectively Phase I, Phase II or the Golf Course, as the case may be; (t) CONSTRUCTION AND MANAGEMENT AGREEMENTS. On or prior to the second advance under the Acquisition and Phase I Development Loan and prior to any advance under the Phase II Development Loan and Golf Course Loan, certified copies of all agreements entered into by the Borrower in connection with the design, construction, development and management of the Improvements to be financed by each of such loans, as the case may be; (u) REVIEW OF LENDER'S COUNSEL. Evidence that Lender's Counsel has reviewed the master covenants, restrictions and declarations and planned unit development documents, all other documents affecting the Development and such other documents relating to the Development as required by Lender, and that Lender is satisfied with the findings by its counsel; (v) BUILDER'S RISK INSURANCE; FLOOD INSURANCE. On or prior to any advance under the Acquisition and Phase I Development Loan, the Phase II Development Loan and Golf Course Loan for structural Improvements, a policy of builder's risk insurance written by a company satisfactory to Lender insuring the

(including storm drainage, utility lines, erosion control and landscaping) plans and specifications; (s) PERMITS. On or prior to the second advance under the Acquisition and Phase I Development Loan and prior to any advance under the Phase II Development Loan and Golf Course Loan, copies of all material permits required to complete construction of the Improvements respectively Phase I, Phase II or the Golf Course, as the case may be; (t) CONSTRUCTION AND MANAGEMENT AGREEMENTS. On or prior to the second advance under the Acquisition and Phase I Development Loan and prior to any advance under the Phase II Development Loan and Golf Course Loan, certified copies of all agreements entered into by the Borrower in connection with the design, construction, development and management of the Improvements to be financed by each of such loans, as the case may be; (u) REVIEW OF LENDER'S COUNSEL. Evidence that Lender's Counsel has reviewed the master covenants, restrictions and declarations and planned unit development documents, all other documents affecting the Development and such other documents relating to the Development as required by Lender, and that Lender is satisfied with the findings by its counsel; (v) BUILDER'S RISK INSURANCE; FLOOD INSURANCE. On or prior to any advance under the Acquisition and Phase I Development Loan, the Phase II Development Loan and Golf Course Loan for structural Improvements, a policy of builder's risk insurance written by a company satisfactory to Lender insuring the structural Improvements to be constructed with advances under the Notes and all property and materials to be used in the construction thereof against such losses as normally are insured against under standard builder's risk policies in an amount of no less than the maximum amount to be advanced hereunder in respect of the Notes, together with evidence of payment of the premium therefor, and that Lender is named as a mortgagee or loss payee as its interest may appear. In addition, if any Improvements are to be located in an area designated as a special flood hazard area, Borrower shall deliver to Lender evidence that flood hazard insurance is in effect from a company and in such amounts as is acceptable to Lender and that such insurance names the Lender as loss payee; (w) OTHER MATTERS. The Lender shall have received from the Borrower such other documents and information as the Lender shall reasonably request, including without limitation satisfactory payoff letters with respect to any existing indebtedness encumbering the Property. 26

SECTION 6. AFFIRMATIVE COVENANTS. Borrower covenants that, from the date hereof until payment in full of the principal and interest on the Notes, unless the Lender otherwise consents in writing, as follows: 6.1 FINANCIAL REPORTS AND OTHER DATA. (a) As soon as practicable and in any event within one hundred twenty (120) days after the end of each fiscal year, deliver, or cause to be delivered to the Lender an unaudited Borrower prepared balance sheet of the Borrower and related statements of income and retained earnings and cash flow for such fiscal year, setting forth in each case in comparative form corresponding figures for the preceding year, all satisfactory to the Lender. Borrower shall also submit, at Lender's request, copies of annually updated year end financial statements on any partnership or corporation in which it has an ownership interest. (b) As soon as practical and in any event within forty-five (45) days after the end of each fiscal quarter, submit to Lender copies of Borrower prepared financial statements, including a balance sheet and related statements of income and retained earnings and cash flow in form and substance satisfactory to the Lender. (c) With reasonable promptness, deliver such additional financial or other data as the Lender may reasonably request regarding Borrower's operations, business affairs and financial condition, including lot sales, remaining lot inventory and golf course operations. The Lender is hereby authorized by the Borrower to deliver a copy of any financial statements made available by the Borrower to any regulatory authority having jurisdiction over the

SECTION 6. AFFIRMATIVE COVENANTS. Borrower covenants that, from the date hereof until payment in full of the principal and interest on the Notes, unless the Lender otherwise consents in writing, as follows: 6.1 FINANCIAL REPORTS AND OTHER DATA. (a) As soon as practicable and in any event within one hundred twenty (120) days after the end of each fiscal year, deliver, or cause to be delivered to the Lender an unaudited Borrower prepared balance sheet of the Borrower and related statements of income and retained earnings and cash flow for such fiscal year, setting forth in each case in comparative form corresponding figures for the preceding year, all satisfactory to the Lender. Borrower shall also submit, at Lender's request, copies of annually updated year end financial statements on any partnership or corporation in which it has an ownership interest. (b) As soon as practical and in any event within forty-five (45) days after the end of each fiscal quarter, submit to Lender copies of Borrower prepared financial statements, including a balance sheet and related statements of income and retained earnings and cash flow in form and substance satisfactory to the Lender. (c) With reasonable promptness, deliver such additional financial or other data as the Lender may reasonably request regarding Borrower's operations, business affairs and financial condition, including lot sales, remaining lot inventory and golf course operations. The Lender is hereby authorized by the Borrower to deliver a copy of any financial statements made available by the Borrower to any regulatory authority having jurisdiction over the Lender. 6.2 TAXES AND LIENS. Promptly pay, or cause to be paid, all taxes, assessments or other governmental charges which may lawfully be levied or assessed upon the income or profits of the Borrower, or upon any property, real, personal or mixed, belonging to the Borrower, or upon any part thereof, and also any lawful claims for labor, material and supplies which, if unpaid, might become a lien or charge against any such property; provided Borrower may in good faith contest any such item so long as no lien attaches to any of the Collateral. 6.3 BUSINESS AND EXISTENCE. Do or cause to be done all things necessary (i) to preserve and to keep in full force and effect its corporate existence; and (ii) to keep in full force and effect its rights and franchises, trade names, patents, trademarks, permits, licenses, copyrights and other proprietary information to the extent material and necessary to the business of the Borrower; and (iii) to continue to engage principally in such business as now conducted by Borrower. 27

6.4 INSURANCE. Keep its businesses and properties insured at all times in responsible insurance companies against the risks and to the extent that provision for such insurance is usually made by other companies engaged in similar businesses similarly situated and consistent with its past practices, and carry such other types and amounts of insurance as are usually carried by companies engaged in the same or a similar business similarly situated and consistent with its past practices, including without limitation: (a) during construction of the structural Improvements for which builder's risk insurance is available, builder risk insurance in an amount not less than 100% of the full replacement cost and, after completion of the Improvements, casualty insurance in an amount not less than the actual cash value (replacement cost at time of loss less depreciation), on all insurable real and personal property serving as collateral for the Notes (except as may be otherwise agreed to by the Lender) against loss or damage by fire and lightning and other hazards ordinarily included under uniform standard extended coverage policies, limited only as may be provided in the standard form of extended coverage endorsement at the time in use in the State of Virginia; (b) general public liability insurance against claims for bodily injury, death or property damage occurring on, in or about the Development in an amount not less than $1,000,000 with respect to bodily injury, death or property damage on a combined single limit basis in any one accident and with an aggregate coverage amount of not less than $2,000,000 during any one policy year; (c) liability insurance with respect to the Development if required under the workers' compensation laws of the

6.4 INSURANCE. Keep its businesses and properties insured at all times in responsible insurance companies against the risks and to the extent that provision for such insurance is usually made by other companies engaged in similar businesses similarly situated and consistent with its past practices, and carry such other types and amounts of insurance as are usually carried by companies engaged in the same or a similar business similarly situated and consistent with its past practices, including without limitation: (a) during construction of the structural Improvements for which builder's risk insurance is available, builder risk insurance in an amount not less than 100% of the full replacement cost and, after completion of the Improvements, casualty insurance in an amount not less than the actual cash value (replacement cost at time of loss less depreciation), on all insurable real and personal property serving as collateral for the Notes (except as may be otherwise agreed to by the Lender) against loss or damage by fire and lightning and other hazards ordinarily included under uniform standard extended coverage policies, limited only as may be provided in the standard form of extended coverage endorsement at the time in use in the State of Virginia; (b) general public liability insurance against claims for bodily injury, death or property damage occurring on, in or about the Development in an amount not less than $1,000,000 with respect to bodily injury, death or property damage on a combined single limit basis in any one accident and with an aggregate coverage amount of not less than $2,000,000 during any one policy year; (c) liability insurance with respect to the Development if required under the workers' compensation laws of the State of Virginia; provided, however, that the insurance so required may be provided by blanket policies now or hereafter maintained by the Borrower; and (d) if at any time any portion of the structural Improvements on any of the real property providing collateral for the Notes is in an area that has been identified by the Secretary of Housing and Urban Development as having special flood and mudslide hazards and for which flood insurance is required to be obtained by Lender, a policy of flood insurance covering such improvements with amounts and coverage satisfactory to the Lender. Each insurance policy obtained in satisfaction of the requirements of subsections (a) through (d) above shall be by such insurer (or insurers) as shall be financially responsible, qualified to do business in Virginia or the jurisdiction of incorporation of the insured, and of recognized standing, shall prohibit cancellation, non-renewal or lapse in coverage by the insurer without at least 30 days' prior written notice to the Lender, shall provide (with respect to insurance under (a) and (d) only) 28

that, except as otherwise provided in the Security Agreement or Deed of Trust, or upon the occurrence of an Event of Default hereunder, losses thereunder shall be adjusted with the insurer by the Borrower at Borrower' expense, and if requested by the Lender, the Lender, on behalf of the insured parties and the decision of such persons as to any adjustment shall be final and conclusive. Each such policy shall name the Lender as mortgagee and loss payee and additional insured thereunder, as its interests may appear. Not later than 30 days prior to the termination or expiration of any such policy then in effect and upon any further request, the Borrower shall deliver or cause to be delivered to the Lender an officer's certificate setting forth the nature of the risks covered by such insurance, the amount carried with respect to each risk, and the name of the insurer. 6.5 MAINTAIN PROPERTY. Maintain its properties in good order and repair, normal wear and tear excepted, and, from time to time, make all needful and proper repairs, renewals, replacements, additions and improvements thereto. 6.6 TRUE BOOKS. Keep books of record and account in which full entries will be made of all of dealings and transactions which fairly and accurately represent such dealings and transactions. Furnish from time to time, whenever requested, statements showing itemization of prospective expenditures, expenditures to date, items due and unpaid, and items necessary for completion, and support such statements with receipted bills, affidavits, waivers of liens, and other evidence satisfactory to Lender; 6.7 INSPECTION RIGHTS. Permit any Person designated by Lender to visit and inspect any of the properties, company books and financial and other reports of Borrower and to discuss its affairs, finances and accounts with

that, except as otherwise provided in the Security Agreement or Deed of Trust, or upon the occurrence of an Event of Default hereunder, losses thereunder shall be adjusted with the insurer by the Borrower at Borrower' expense, and if requested by the Lender, the Lender, on behalf of the insured parties and the decision of such persons as to any adjustment shall be final and conclusive. Each such policy shall name the Lender as mortgagee and loss payee and additional insured thereunder, as its interests may appear. Not later than 30 days prior to the termination or expiration of any such policy then in effect and upon any further request, the Borrower shall deliver or cause to be delivered to the Lender an officer's certificate setting forth the nature of the risks covered by such insurance, the amount carried with respect to each risk, and the name of the insurer. 6.5 MAINTAIN PROPERTY. Maintain its properties in good order and repair, normal wear and tear excepted, and, from time to time, make all needful and proper repairs, renewals, replacements, additions and improvements thereto. 6.6 TRUE BOOKS. Keep books of record and account in which full entries will be made of all of dealings and transactions which fairly and accurately represent such dealings and transactions. Furnish from time to time, whenever requested, statements showing itemization of prospective expenditures, expenditures to date, items due and unpaid, and items necessary for completion, and support such statements with receipted bills, affidavits, waivers of liens, and other evidence satisfactory to Lender; 6.7 INSPECTION RIGHTS. Permit any Person designated by Lender to visit and inspect any of the properties, company books and financial and other reports of Borrower and to discuss its affairs, finances and accounts with its accountants and principal officers, all at such reasonable times and as often as the Lender may reasonably request following reasonable notice to Borrower by Lender. Permit the Lender, or its representatives, and an architect or inspector selected by the Lender, to enter upon the Development, inspect the Improvements and all materials to be used in the construction thereof and to examine all detailed plans and shop drawings which are or may be kept at the construction site and cooperate with any such architect or inspector to enable him to perform his functions hereunder and pay to the Lender an inspection fee of $500 for each such inspection. 6.8 THE BORROWER'S KNOWLEDGE OF CERTAIN EVENTS. Upon Borrower obtaining knowledge of the occurrence of any Default or Event of Default hereunder, or an event which would constitute such an Event of Default or Default hereunder, or any material adverse change in Borrower's condition, financial or otherwise, cause to be delivered to the Lender, within fifteen (15) business days of such officer obtaining such knowledge, an officer's certificate specifying the nature thereof, the period of existence thereof and what action the Borrower proposes to take with respect thereto. 6.9 OTHER NOTICES. Notify the Lender in writing within fifteen (15) business days of the occurrence of any of the following with respect to the Borrower: 29

(i) the service upon Borrower of any material action, suit or proceeding at law or in equity (as used herein, the term "material" refers to any action, suit or proceeding involving a potential liability in excess of $50,000 which is not fully covered by insurance); (ii) any event or condition which shall constitute an event of default under any other agreement for borrowed money or any known or potential material change in this or any other contractual agreement, provided such other agreement for borrowed money or other contractual agreement relates to an actual or potential obligation in excess of $50,000; (iii) any levy of an attachment, execution or other process against the assets of Borrower; and (iv) any change in any existing agreement or contract which may materially adversely affect any of the business affairs, financial or otherwise, of Borrower at the Development. 6.10 FURTHER ASSURANCES. Upon request of the Lender, duly execute and deliver or cause to be duly executed and delivered to the Lender such further instruments and do and cause to be done such further acts that may be reasonably necessary or proper in the opinion of the Lender to carry out more effectively the provisions

(i) the service upon Borrower of any material action, suit or proceeding at law or in equity (as used herein, the term "material" refers to any action, suit or proceeding involving a potential liability in excess of $50,000 which is not fully covered by insurance); (ii) any event or condition which shall constitute an event of default under any other agreement for borrowed money or any known or potential material change in this or any other contractual agreement, provided such other agreement for borrowed money or other contractual agreement relates to an actual or potential obligation in excess of $50,000; (iii) any levy of an attachment, execution or other process against the assets of Borrower; and (iv) any change in any existing agreement or contract which may materially adversely affect any of the business affairs, financial or otherwise, of Borrower at the Development. 6.10 FURTHER ASSURANCES. Upon request of the Lender, duly execute and deliver or cause to be duly executed and delivered to the Lender such further instruments and do and cause to be done such further acts that may be reasonably necessary or proper in the opinion of the Lender to carry out more effectively the provisions and purposes of the Loan Documents. 6.11 OBSERVE ALL LAWS. Conform to and duly observe all laws, regulations and other valid requirements of any regulatory authority with respect to the conduct of its businesses, the failure of which would have a material adverse affect on Borrower, or its business and operations. 6.12 ERISA. Comply with all requirements of ERISA applicable to it (including the payment of all obligations and liabilities arising under ERISA) and furnish to the Lender as soon as possible and in any event within 30 days after it or any duly appointed administrator of any employee pension benefit plan (as defined in ERISA) knows or has reason to know that any Reportable Event (as defined in ERISA) with respect to any such plan has occurred, a statement describing in reasonable detail such Reportable Event and any action which the Borrower proposes to take with respect thereto, together with a copy of the notice of such Reportable Event given to the Pension Benefit Guaranty Corporation or a statement that said notice will be filed with the annual report to the United States Department of Labor with respect to such plan if such filing has been authorized. 6.13 PAYMENT OF OBLIGATIONS. Pay when due (including any applicable grace period) all obligations and liabilities, except where the same (other than Indebtedness for Money Borrowed and final judgments) may be contested in good faith and 30

appropriate reserves for the accrual of same in amounts satisfactory to the Lender are maintained. 6.14 CONTINUED OPERATIONS. Continue at all times (a) to maintain its principal place of business with respect to the Development at the addresses set forth in Section 4.6 hereof, (b) to maintain its accounts, records, equipment and other personal property at the addresses specified in Section 4.6 and (c) to conduct its operations under their current name. 6.15 PRINCIPAL BANKING RELATIONSHIP. Maintain at all times such Borrower's principal banking and deposit accounts with the Lender. 6.16 HAZARDOUS WASTE INDEMNITY. (a) Indemnify the Lender and hold the Lender harmless from and against any and all losses, liabilities, judgments, damages, penalties, fines, liens, suits, injuries, costs (including cleanup costs), expenses (including attorneys', consultants', or experts' fees and expenses) and claims of any and every kind whatsoever paid, incurred or suffered by, or asserted against the Lender for, with respect to, or as a direct or indirect result of, (i) the presence on or under, or the escape, seepage, leakage, spillage, discharge, emission, discharging or release from, the Development or any Collateral of any Hazardous Materials (including, without limitation, any losses, liabilities,

appropriate reserves for the accrual of same in amounts satisfactory to the Lender are maintained. 6.14 CONTINUED OPERATIONS. Continue at all times (a) to maintain its principal place of business with respect to the Development at the addresses set forth in Section 4.6 hereof, (b) to maintain its accounts, records, equipment and other personal property at the addresses specified in Section 4.6 and (c) to conduct its operations under their current name. 6.15 PRINCIPAL BANKING RELATIONSHIP. Maintain at all times such Borrower's principal banking and deposit accounts with the Lender. 6.16 HAZARDOUS WASTE INDEMNITY. (a) Indemnify the Lender and hold the Lender harmless from and against any and all losses, liabilities, judgments, damages, penalties, fines, liens, suits, injuries, costs (including cleanup costs), expenses (including attorneys', consultants', or experts' fees and expenses) and claims of any and every kind whatsoever paid, incurred or suffered by, or asserted against the Lender for, with respect to, or as a direct or indirect result of, (i) the presence on or under, or the escape, seepage, leakage, spillage, discharge, emission, discharging or release from, the Development or any Collateral of any Hazardous Materials (including, without limitation, any losses, liabilities, judgments, damages, penalties, fines, liens, suits, injuries, costs (including cleanup costs), expenses (including attorneys', consultants', or experts' fees and expenses) or claims asserted or arising under any Environmental Laws, which may require the elimination or removal of such Hazardous Materials by Borrower or the Lender or any successors or assigns thereof, regardless of whether or not caused by, or within the control of, Borrower or (ii) any representation or warranty by Borrower contained in Section 4.15 being false or untrue in any material respect; PROVIDED the foregoing indemnity shall not be available to Lender to the extent caused by Lender or its agents or employees; (b) If Borrower receives any notice of (i) the happening of any event involving the generation, use, spill, discharge or storage, disposal or cleanup of any Hazardous Materials (a "Hazardous Discharge") affecting Borrower or the Development or any Collateral in violation of any Environmental Law or (ii) any complaint, order, citation or notice with regard to air emissions, water discharges, surface contaminations, noise emissions or any other environmental, health or safety matter affecting Borrower or the Development or any Collateral (an "Environmental Complaint") from any person or entity, including, without limitation, the United States Environmental Protection Agency ("EPA") or any agency, department or authority of the State of North Carolina, then the Borrower will give, within 31

seven (7) Business Days, oral and written notice of same to the Lender. The Borrower will also give the Lender oral and written notice of any change in any material respect in the nature or extent of any Hazardous Materials maintained on, in or under the Development within seven (7) Business Days of such change; (c) Without limitation of its rights under this Agreement, the Lender shall have the right, but not the obligation, to enter onto the Development or any Collateral or to take such other actions as it deems necessary or advisable to cleanup, remove, resolve or minimize the impact of, or otherwise deal with, or participate in such actions with respect to any such Hazardous Discharge or Environmental Complaint upon its receipt of any notice from any Person or entity, including, without limitation, the EPA, asserting the existence of any Hazardous Discharge or Environmental Complaint on or pertaining to the Development or any Collateral which, if true, could result in an order, suit or other action against Borrower affecting any part of the Development or any Collateral by any governmental agency or otherwise which, in the sole opinion of the Lender, as the case may be, could jeopardize the Lender's security under the Loan Documents. All reasonable costs and expenses incurred by the Lender in the exercise of any such rights shall be secured by the Loan Documents and shall be payable by the Borrower upon demand, together with interest thereon at a rate equal to the interest rate payable under the Golf Course Note; (d) The indemnity obligations of the Borrower under this Section 6.16 shall survive payment of the Notes.

seven (7) Business Days, oral and written notice of same to the Lender. The Borrower will also give the Lender oral and written notice of any change in any material respect in the nature or extent of any Hazardous Materials maintained on, in or under the Development within seven (7) Business Days of such change; (c) Without limitation of its rights under this Agreement, the Lender shall have the right, but not the obligation, to enter onto the Development or any Collateral or to take such other actions as it deems necessary or advisable to cleanup, remove, resolve or minimize the impact of, or otherwise deal with, or participate in such actions with respect to any such Hazardous Discharge or Environmental Complaint upon its receipt of any notice from any Person or entity, including, without limitation, the EPA, asserting the existence of any Hazardous Discharge or Environmental Complaint on or pertaining to the Development or any Collateral which, if true, could result in an order, suit or other action against Borrower affecting any part of the Development or any Collateral by any governmental agency or otherwise which, in the sole opinion of the Lender, as the case may be, could jeopardize the Lender's security under the Loan Documents. All reasonable costs and expenses incurred by the Lender in the exercise of any such rights shall be secured by the Loan Documents and shall be payable by the Borrower upon demand, together with interest thereon at a rate equal to the interest rate payable under the Golf Course Note; (d) The indemnity obligations of the Borrower under this Section 6.16 shall survive payment of the Notes. 6.17 USE OF LOAN PROCEEDS. Use the proceeds of the loans made hereby solely for the purposes set forth in Section 2 hereof. 6.18 WATER AND SEWER CAPACITY. Take all steps necessary to ensure adequate water and sewer capacity availability to the Development. 6.19 COMMENCEMENT OF CONSTRUCTION. Begin construction of the Improvements to be constructed with advances hereunder as soon as practicable; to prosecute diligently the construction of such Improvements; to not discontinue or permit the discontinuance of construction thereof for as much as ten (10) days unless weather or some other factor beyond the control of Borrower intervenes; and, in any event, to complete the construction of such Improvements in strict compliance with the Plans and Specifications and free and clear of liens and claims of liens for services and labor performed or materials supplied in connection therewith on or before the date established by Lender and Borrower for completion of such Improvements. 6.20 CONTRACTORS. To deliver to Lender, upon request, the names of all persons with whom Borrower have contracted or intend to contract for services, labor 32

or materials in connection with the construction of the Improvements to be constructed with advances hereunder. 6.21 INSPECTION, PLANS AND RECEIPTS. To permit Lender and Lender's authorized agents to enter upon the Property during normal working hours and as often as Lender desires for the purpose of inspecting the construction of the Improvements to be constructed with advances hereunder. Upon request, Borrower will furnish to Lender detailed plans, shop drawings and specifications which relate to such Improvements. Failure of Lender or its authorized agents to discover any defects or to reject materials or workmanship shall not make Lender liable to Borrower or to any other person and no prior failure shall constitute a waiver by Lender of Lender's right to reject subsequently any such workmanship or materials. When requested by Lender, Borrower will furnish to Lender proof that all bills for services, labor and materials for such Improvements have been paid except those which will be paid from the next succeeding request for disbursement. 6.22 SURVEYS. Prior to any advance for construction of the Golf Course, provide to Lender a routing plan of the golf course layout acceptable to the Lender and prior to any advance for construction of any structure, a foundation survey acceptable to the Lender. 6.23 PAYMENT OF COST OVERRUNS. Pay with its own funds, and not Acquisition and Phase I Development Loan, Phase II Development Loan or Golf Course Loan proceeds, all cost overruns associated

or materials in connection with the construction of the Improvements to be constructed with advances hereunder. 6.21 INSPECTION, PLANS AND RECEIPTS. To permit Lender and Lender's authorized agents to enter upon the Property during normal working hours and as often as Lender desires for the purpose of inspecting the construction of the Improvements to be constructed with advances hereunder. Upon request, Borrower will furnish to Lender detailed plans, shop drawings and specifications which relate to such Improvements. Failure of Lender or its authorized agents to discover any defects or to reject materials or workmanship shall not make Lender liable to Borrower or to any other person and no prior failure shall constitute a waiver by Lender of Lender's right to reject subsequently any such workmanship or materials. When requested by Lender, Borrower will furnish to Lender proof that all bills for services, labor and materials for such Improvements have been paid except those which will be paid from the next succeeding request for disbursement. 6.22 SURVEYS. Prior to any advance for construction of the Golf Course, provide to Lender a routing plan of the golf course layout acceptable to the Lender and prior to any advance for construction of any structure, a foundation survey acceptable to the Lender. 6.23 PAYMENT OF COST OVERRUNS. Pay with its own funds, and not Acquisition and Phase I Development Loan, Phase II Development Loan or Golf Course Loan proceeds, all cost overruns associated with the Development. 6.24 YEAR 2000 COMPLIANCE. Make such inquiries as necessary to determine whether any computer application of the Borrower's suppliers, vendors and customers that is material to the Borrower's business and operations is "Year 2000 Compliant", and promptly notify the Lender in the event the Borrower discovers or determines that any computer application (including those of its suppliers, vendors and customers) that is material to its business and operations will not be "Year 2000 Compliant" and take all such action as is necessary to remedy such situation, except to the extent that such failure could not reasonably be expected to have a material adverse effect on the business, operations and financial condition of the Borrower. SECTION 7. NEGATIVE COVENANTS OF THE BORROWER. Borrower covenants and agrees that from the date hereof until payment in full of the principal and interest on the Notes, unless the Lender shall otherwise have consented prior thereto in writing, it will not either directly or indirectly: 7.1 INDEBTEDNESS. Incur, create, guarantee, assume or permit to exist any Indebtedness (including guaranties or contingent obligations relating to Indebtedness) however evidenced, except 33

(i) Indebtedness existing on the date hereof and described in the financial statements delivered to the Lender pursuant to Section 6.1 hereof or the notes thereto, which Indebtedness shall be repaid in accordance with the terms relating thereto existing as of the date hereof (including the terms thereof permitting prepayment); (ii) Indebtedness to the Lender arising under this Agreement; or (iii) Indebtedness related to the Development, but only as long as such Indebtedness is NOT secured by any lien, pledge or security interest on any real or personal property on which the Lender has a lien, pledge or security interest which secures the Notes. 7.2 LIMITATIONS ON LIENS. Incur, create, assume or permit to exist any mortgage, pledge, security interest, encumbrance, lien or charge of any kind upon any property or assets now owned or hereafter acquired of any character relating to the Development, including those arising under conditional sales or other title retention agreements, except Permitted Encumbrances. 7.3 TRANSFER OF ASSETS. Sell, assign, lease, transfer or otherwise dispose of all or substantially all of its assets relating to the Development except for sales of lots in the ordinary course of business and the transfer of Common Property and dedication of water and sewer improvements and roadway improvements contemplated by Section 2.10(b).

(i) Indebtedness existing on the date hereof and described in the financial statements delivered to the Lender pursuant to Section 6.1 hereof or the notes thereto, which Indebtedness shall be repaid in accordance with the terms relating thereto existing as of the date hereof (including the terms thereof permitting prepayment); (ii) Indebtedness to the Lender arising under this Agreement; or (iii) Indebtedness related to the Development, but only as long as such Indebtedness is NOT secured by any lien, pledge or security interest on any real or personal property on which the Lender has a lien, pledge or security interest which secures the Notes. 7.2 LIMITATIONS ON LIENS. Incur, create, assume or permit to exist any mortgage, pledge, security interest, encumbrance, lien or charge of any kind upon any property or assets now owned or hereafter acquired of any character relating to the Development, including those arising under conditional sales or other title retention agreements, except Permitted Encumbrances. 7.3 TRANSFER OF ASSETS. Sell, assign, lease, transfer or otherwise dispose of all or substantially all of its assets relating to the Development except for sales of lots in the ordinary course of business and the transfer of Common Property and dedication of water and sewer improvements and roadway improvements contemplated by Section 2.10(b). 7.4 INSIDER TRANSACTIONS. Directly or indirectly purchase, acquire or lease any property or asset from, or purchase, sell, dispose of, exchange or lease any property or assets to, or render service to, or otherwise deal with, in the ordinary course of business or otherwise, any affiliate, except pursuant to reasonable requirements and upon fair and reasonable terms and conditions not less favorable to Borrower than if it were a comparable arm's length transaction and no such relationship existed. 7.5 CHANGE ORDERS. Authorize, request, allow or otherwise make change orders in excess of $10,000 in the Plans and Specifications for the Improvements to be financed without the Lender's prior approval, which will not be unreasonably withheld or delayed. 7.6 DISTRIBUTIONS, REDEMPTIONS AND OTHER PAYMENTS. (a) Declare or make any distributions or dividends on any ownership interest of Borrower now or hereafter outstanding, or (b) purchase, redeem or otherwise retire any such ownership interest, or apply or set apart any of its assets therefor or make any other distribution (by reduction of capital or otherwise) in respect of any such ownership interest, or (c) agree to do any of the foregoing. 34

7.7 LOANS AND INVESTMENTS. Lend or advance money, credit or property to any Person, or invest in (by capital contribution or otherwise), or purchase or repurchase the stock or indebtedness, or all or a substantial part of the assets or properties of any Person, or agree to do any of the foregoing, except for (i) direct obligations of, or obligations the principal of and interest on which are unconditionally guaranteed by, the United States of America and which mature within one year from the date of acquisition thereof; (ii) investments in commercial paper of any corporation with a maturity not in excess of thirty days from the date of acquisition thereof and rated P-1 or better by Moody's Investors Services, Inc., or A-1 or better by Standard & Poor's Corporation; (iii) investments in certificates of deposit with a maturity not in excess of ninety days from the date of acquisition thereof, issued by (a) the Lender or (b) any commercial bank organized and existing under the laws of the United States of America or under any state of the United States of America and having a combined capital and undivided surplus of not less than $50,000,000, provided, however, that certificates of deposit at any one bank shall at no time exceed ten percent (10%) of the undivided capital and surplus of such bank; and (iv) purchase money loans to purchasers of lots in the Development (or other developments owned by Borrower).

7.7 LOANS AND INVESTMENTS. Lend or advance money, credit or property to any Person, or invest in (by capital contribution or otherwise), or purchase or repurchase the stock or indebtedness, or all or a substantial part of the assets or properties of any Person, or agree to do any of the foregoing, except for (i) direct obligations of, or obligations the principal of and interest on which are unconditionally guaranteed by, the United States of America and which mature within one year from the date of acquisition thereof; (ii) investments in commercial paper of any corporation with a maturity not in excess of thirty days from the date of acquisition thereof and rated P-1 or better by Moody's Investors Services, Inc., or A-1 or better by Standard & Poor's Corporation; (iii) investments in certificates of deposit with a maturity not in excess of ninety days from the date of acquisition thereof, issued by (a) the Lender or (b) any commercial bank organized and existing under the laws of the United States of America or under any state of the United States of America and having a combined capital and undivided surplus of not less than $50,000,000, provided, however, that certificates of deposit at any one bank shall at no time exceed ten percent (10%) of the undivided capital and surplus of such bank; and (iv) purchase money loans to purchasers of lots in the Development (or other developments owned by Borrower). 7.8 NO MINING. Permit or allow any form of mining or other mineral excavation to occur on the Property. SECTION 8. EVENTS OF DEFAULT AND REMEDIES. (a) An Event of Default shall exist if any of the following shall occur: 8.1 PAYMENT OF NOTES. If Borrower defaults in the payment of any principal of or interest on the Notes when due, or the payment of any other amount payable hereunder or under any of the other Loan Documents, either by the terms hereof or thereof or otherwise as herein or therein provided, and such default continues for a period of 10 days after the date such payment was due; or 8.2 PAYMENT OF OTHER INDEBTEDNESS. If Borrower defaults in the payment of principal of, by acceleration or otherwise, or interest on any Indebtedness for Money Borrowed (including guaranties or contingent obligations relating to Indebtedness for Money Borrowed and including all Indebtedness for Money Borrowed owing to the Lender) beyond any period of grace provided with respect thereto, or in the performance of any other agreement, term or condition contained in any agreement 35

under which any such obligation is created, if the effect of such default is to cause, or permit the holder or holders of such obligation (or a trustee in behalf of such holder or holders) to cause, such obligation to become due prior to its stated maturity; or 8.3 REPRESENTATION, WARRANTY, ETC. If any representation or warranty made by Borrower herein, or in any writing furnished in connection with or pursuant to this Agreement or any of the other Loan Documents, or if any report, certificate, financial statement or other instrument or document delivered to the Lender by or on behalf of Borrower, shall be false or misleading in any material respect on the date as of which made; or 8.4 CERTAIN COVENANTS. If Borrower defaults in the performance or observance of any agreement or covenant contained in Sections 6 and 7 hereof; provided if such default is a "non-monetary" default, as determined by the Lender in its sole discretion, such Borrower shall not have cured such non-monetary default within thirty (30) days after receipt of written notice; provided if such default reasonably cannot be cured in 30 days such 30 day period will be extended for such additional time (not to exceed 60 days) as is reasonably necessary to cure such default provided that Borrower commences and diligently pursues such cure; or 8.5 OTHER COVENANTS. If Borrower defaults in the performance or observance of any other agreement, covenant, term or condition binding on it contained herein (other than those referred to in Sections 8.1 through

under which any such obligation is created, if the effect of such default is to cause, or permit the holder or holders of such obligation (or a trustee in behalf of such holder or holders) to cause, such obligation to become due prior to its stated maturity; or 8.3 REPRESENTATION, WARRANTY, ETC. If any representation or warranty made by Borrower herein, or in any writing furnished in connection with or pursuant to this Agreement or any of the other Loan Documents, or if any report, certificate, financial statement or other instrument or document delivered to the Lender by or on behalf of Borrower, shall be false or misleading in any material respect on the date as of which made; or 8.4 CERTAIN COVENANTS. If Borrower defaults in the performance or observance of any agreement or covenant contained in Sections 6 and 7 hereof; provided if such default is a "non-monetary" default, as determined by the Lender in its sole discretion, such Borrower shall not have cured such non-monetary default within thirty (30) days after receipt of written notice; provided if such default reasonably cannot be cured in 30 days such 30 day period will be extended for such additional time (not to exceed 60 days) as is reasonably necessary to cure such default provided that Borrower commences and diligently pursues such cure; or 8.5 OTHER COVENANTS. If Borrower defaults in the performance or observance of any other agreement, covenant, term or condition binding on it contained herein (other than those referred to in Sections 8.1 through 8.4 hereof) and such default shall not have been remedied within thirty (30) days after written notice thereof shall have been received by Borrower from the Lender; provided if such default reasonably cannot be cured in 30 days such 30 day period will be extended for such additional time (not to exceed 60 days) as is reasonably necessary to cure such default provided that Borrower commences and diligently pursues such cure; or 8.6 OTHER DOCUMENTS. If there shall occur any "Default" or "Event of Default" (beyond any grace periods applicable to such Default or Event of Default) as specified in any of the other Loan Documents; or 8.7 LIQUIDATION OR DISSOLUTION. Liquidation or dissolution of Borrower, or suspension of the business of Borrower or filing by Borrower of a voluntary petition in bankruptcy or a voluntary petition or an answer seeking reorganization, arrangement, readjustment of its debts or for any other relief under the United States Bankruptcy Code, as amended, or under any other insolvency act or law, state or federal, now or hereafter existing, or any other action of Borrower indicating its consent to, approval of, or acquiescence in any petition or proceedings; the application by or for, or the appointment by consent or acquiescence of, a receiver, a trustee or a custodian of Borrower or an assignment for the benefit of creditors, the inability of Borrower or the admission by Borrower in writing of inability to pay its debts as they mature; or 36

8.8 BANKRUPTCY, ETC. Filing of an involuntary petition against Borrower in bankruptcy or seeking reorganization, arrangement, readjustment of its debts or for any other relief under the United States Bankruptcy Code, as amended, or under any other insolvency act or law, state or federal, now or hereafter existing; or the involuntary appointment of a receiver, a trustee or a custodian of Borrower or for all or a substantial part of its property; the issuance of a warrant of attachment, execution or similar process against any substantial part of the property of Borrower and the continuance of any of the events referred to in this Section 8.8 for sixty (60) days undismissed or undischarged; or 8.9 JUDGMENT. If a judgment which has become final and nonappealable, which with other outstanding judgments against Borrower or any subsidiary exceeds an aggregate of $50,000 in excess of applicable insurance coverage and which the Lender reasonably believes would impair the financial condition of the Borrower, shall be rendered against Borrower and if within thirty (30) days after entry thereof such judgment shall not have been discharged or stayed; or 8.10 TRANSFER OR ENCUMBRANCE. The sale, transfer or encumbrance (except liens in favor of Lender) of all or any part of the property securing the Obligations or any interest therein (except for the sale of lots in the Development in the ordinary course of business and transfer of Common Property and dedication of water and sewer improvements and roadways contemplated by Section 2.10(b)), without Lender's prior written consent.

8.8 BANKRUPTCY, ETC. Filing of an involuntary petition against Borrower in bankruptcy or seeking reorganization, arrangement, readjustment of its debts or for any other relief under the United States Bankruptcy Code, as amended, or under any other insolvency act or law, state or federal, now or hereafter existing; or the involuntary appointment of a receiver, a trustee or a custodian of Borrower or for all or a substantial part of its property; the issuance of a warrant of attachment, execution or similar process against any substantial part of the property of Borrower and the continuance of any of the events referred to in this Section 8.8 for sixty (60) days undismissed or undischarged; or 8.9 JUDGMENT. If a judgment which has become final and nonappealable, which with other outstanding judgments against Borrower or any subsidiary exceeds an aggregate of $50,000 in excess of applicable insurance coverage and which the Lender reasonably believes would impair the financial condition of the Borrower, shall be rendered against Borrower and if within thirty (30) days after entry thereof such judgment shall not have been discharged or stayed; or 8.10 TRANSFER OR ENCUMBRANCE. The sale, transfer or encumbrance (except liens in favor of Lender) of all or any part of the property securing the Obligations or any interest therein (except for the sale of lots in the Development in the ordinary course of business and transfer of Common Property and dedication of water and sewer improvements and roadways contemplated by Section 2.10(b)), without Lender's prior written consent. (b) REMEDIES. If an Event of Default has occurred and has not been waived or cured within applicable cure periods, the Lender shall have no further obligation to make advances under the Acquisition and Phase I Development Loan, the Phase II Development Loan or Golf Course Loan, the Lender may exercise any right, power or remedy permitted it by law, and shall have, in particular, without limiting the generality of the foregoing, the right to declare the entire principal and all interest accrued on the Notes then outstanding to be, and such Notes shall thereupon become, forthwith due and payable, without presentment, demand, protest or other notice of any kind, all of which are hereby expressly waived, anything contained herein or in the Notes or the other Loan Documents to the contrary notwithstanding and the Borrower will forthwith pay to the holder of the Notes the entire principal of and interest accrued on such Notes. Notwithstanding the foregoing, upon the occurrence of an Event of Default described in Sections 8.7 and 8.8 the entire amount owing hereunder shall become immediately due and payable without declaration or demand. In addition, the Lender shall be entitled to immediately proceed to foreclose on its liens and security interests in the Collateral, and to exercise all rights and remedies provided for by law or contained in and afforded by any of the Loan Documents. 8.11 SECURITY INTEREST. Lender shall have and hereby is granted a lien and a security interest in any and all reserves, deferred payments, undisbursed loan 37

proceeds, insurance refunds, impound accounts, refunds for overpayment of any kind, and any surplus funds of Borrower whether the same arise out of or occur in connection with the Development, Acquisition and Phase I Development Loan, the Phase II Development Loan or Golf Course Loan made hereunder, and such lien and security interest shall constitute additional security for the loans. Upon the occurrence of an Event of Default under this Agreement, Lender shall have and possess any and all remedies of a secured party provided by law with respect to enforcement of and recovery on its lien and security interest on such items and amounts. 8.12 OPTION TO PAY CONTRACTORS. If an Event of Default shall exist, at its option, the Lender may make Acquisition and Phase I Development Loan, Phase II Development Loan or Golf Course Loan disbursements directly to any unpaid contractor, subcontractor, laborer or material supplier providing labor, services or materials in connection with the construction of the Improvements, and the execution of this Agreement by the Borrower shall, and hereby does, constitute an irrevocable direction and authorization to so disburse the funds. No further direction or authorization from the Borrower shall be necessary to warrant such direct disbursements and all such disbursements shall be secured by the Deed of Trust and other Loan Documents as fully as if made to the Borrower, regardless of the disposition thereof by any subcontractor, laborer or material supplier so paid. SECTION 9. MISCELLANEOUS.

proceeds, insurance refunds, impound accounts, refunds for overpayment of any kind, and any surplus funds of Borrower whether the same arise out of or occur in connection with the Development, Acquisition and Phase I Development Loan, the Phase II Development Loan or Golf Course Loan made hereunder, and such lien and security interest shall constitute additional security for the loans. Upon the occurrence of an Event of Default under this Agreement, Lender shall have and possess any and all remedies of a secured party provided by law with respect to enforcement of and recovery on its lien and security interest on such items and amounts. 8.12 OPTION TO PAY CONTRACTORS. If an Event of Default shall exist, at its option, the Lender may make Acquisition and Phase I Development Loan, Phase II Development Loan or Golf Course Loan disbursements directly to any unpaid contractor, subcontractor, laborer or material supplier providing labor, services or materials in connection with the construction of the Improvements, and the execution of this Agreement by the Borrower shall, and hereby does, constitute an irrevocable direction and authorization to so disburse the funds. No further direction or authorization from the Borrower shall be necessary to warrant such direct disbursements and all such disbursements shall be secured by the Deed of Trust and other Loan Documents as fully as if made to the Borrower, regardless of the disposition thereof by any subcontractor, laborer or material supplier so paid. SECTION 9. MISCELLANEOUS. 9.1 WAIVERS, AMENDMENTS, ETC. The provisions of this Agreement and the other Loan Documents may, subject to the provisions of this Section 9, from time to time be amended, modified or waived, provided such amendment, modification or waiver is in writing and consented to by the Borrower and the Lender. No failure or delay on the part of the Lender in exercising any power or right under this Agreement or the other Loan Documents shall operate as a waiver thereof, nor shall any single or partial exercise of any such power or right preclude any other or further exercise thereof or the exercise of any other power or right. No notice to or demand on the Borrower in any case shall entitle it to any notice or demand in similar or other circumstances. No waiver or approval hereunder shall require any similar or dissimilar waiver or approval thereafter to be granted hereunder. 9.2 WAIVER OF DEFAULT. The Lender may, by written notice to the Borrower, at any time and from time to time, waive any default in the performance or observance of any condition, covenant or other term hereof or any Event of Default which shall have occurred hereunder and its consequences. Any such waiver shall be for such period and subject to such conditions as shall be specified in any such notice. In the case of any such waiver, the Borrower and the Lender shall be restored to their former position and rights hereunder, under the Notes issued hereunder, and under the other Loan Documents, and any Event of Default so waived shall be deemed to be 38

cured and not continuing; but no such waiver shall extend to any subsequent or other Event of Default, or impair any right consequent thereon. 9.3 LIEN. It is understood and agreed that the Lender shall have and enjoy and is hereby granted a lien on and a security interest in, any and all materials (stored on-site or off-site), reserves, deferred payments, deposits or advance payments for materials (stored on-site or off-site), undisbursed loan proceeds, insurance refunds, impound accounts, refunds for overpayment of any kind, and any surplus of withheld funds resulting from the invalidity of "stop notice" claims or the failure of claimants to prosecute their claims to judgment, to the extent the same arise out of or occur in connection with the construction of the Improvements, and such lien and security interest shall constitute additional security for the indebtedness of the Borrower evidenced by the Notes, and the Lender shall have and possess any and all rights and remedies of a secured party provided by law with respect to enforcement of and recovery on its security interest on such items and amounts. 9.4 NOTICES. All notices, requests and demands to or upon the respective parties hereto shall be deemed to have been given or made when (i) hand delivered, (ii) on the third day following deposit in the mail, postage prepaid by registered or certified mail, return receipt requested, (iii) in the case of telegraphic notice, when received from the telegraph company, or (iv) in the case of transmission by telefacsimile device, when such telefacsimile is received, in each case addressed as follows or to such other address as may be hereafter designated in writing by the respective parties hereto:

cured and not continuing; but no such waiver shall extend to any subsequent or other Event of Default, or impair any right consequent thereon. 9.3 LIEN. It is understood and agreed that the Lender shall have and enjoy and is hereby granted a lien on and a security interest in, any and all materials (stored on-site or off-site), reserves, deferred payments, deposits or advance payments for materials (stored on-site or off-site), undisbursed loan proceeds, insurance refunds, impound accounts, refunds for overpayment of any kind, and any surplus of withheld funds resulting from the invalidity of "stop notice" claims or the failure of claimants to prosecute their claims to judgment, to the extent the same arise out of or occur in connection with the construction of the Improvements, and such lien and security interest shall constitute additional security for the indebtedness of the Borrower evidenced by the Notes, and the Lender shall have and possess any and all rights and remedies of a secured party provided by law with respect to enforcement of and recovery on its security interest on such items and amounts. 9.4 NOTICES. All notices, requests and demands to or upon the respective parties hereto shall be deemed to have been given or made when (i) hand delivered, (ii) on the third day following deposit in the mail, postage prepaid by registered or certified mail, return receipt requested, (iii) in the case of telegraphic notice, when received from the telegraph company, or (iv) in the case of transmission by telefacsimile device, when such telefacsimile is received, in each case addressed as follows or to such other address as may be hereafter designated in writing by the respective parties hereto:
The Borrower: Bluegreen Properties of Virginia, Inc. c/o Bluegreen Corporation 4960 Blue Lake Drive Boca Raton, Florida 33431 Attn: President

with a copy (the delivery of which shall not be a condition to any effectiveness of such notice to Borrower) to:
Charles H. Rothenberg, Esq. Hirschler, Fleischer, Weinberg, Cox & Allen 701 East Byrd Street, 16th Floor Richmond, Virginia 23219 Telefacsimile: (804) 644-0957 The Lender: Branch Banking and Trust Company Post Office Box 1727 Wilmington, North Carolina 28402 Attention: Mark Cayton Telefacsimile: (910) 815-2799

39

except in cases where it is expressly herein provided that such notice, request or demand is not effective until received by the party to whom it is addressed. 9.5 SURVIVAL OF AGREEMENTS. All agreements, representations and warranties made herein shall survive the delivery of the Notes. 9.6 GOVERNING LAW AND JURISDICTION. This Agreement, the Notes and other Loan Documents shall be governed in all respects by the laws of North Carolina. Borrower hereby submits to the jurisdiction of the state and federal courts located in North Carolina and agree that the Lender may, at its option, enforce its rights under the Loan Documents in such courts. 9.7 ENFORCEABILITY OF AGREEMENT. Should any one or more of the provisions of this Agreement or other Loan Documents be determined to be illegal or unenforceable as to one or more of the parties, all other provisions nevertheless shall remain effective and binding on the parties hereto. 9.8 COUNTERPARTS AND EFFECTIVENESS. This Agreement may be executed by the parties hereto in

except in cases where it is expressly herein provided that such notice, request or demand is not effective until received by the party to whom it is addressed. 9.5 SURVIVAL OF AGREEMENTS. All agreements, representations and warranties made herein shall survive the delivery of the Notes. 9.6 GOVERNING LAW AND JURISDICTION. This Agreement, the Notes and other Loan Documents shall be governed in all respects by the laws of North Carolina. Borrower hereby submits to the jurisdiction of the state and federal courts located in North Carolina and agree that the Lender may, at its option, enforce its rights under the Loan Documents in such courts. 9.7 ENFORCEABILITY OF AGREEMENT. Should any one or more of the provisions of this Agreement or other Loan Documents be determined to be illegal or unenforceable as to one or more of the parties, all other provisions nevertheless shall remain effective and binding on the parties hereto. 9.8 COUNTERPARTS AND EFFECTIVENESS. This Agreement may be executed by the parties hereto in any number of counterparts and each counterpart shall be deemed to be an original but all shall constitute together but one and the same Agreement. 9.9 FEES AND EXPENSES. Whether or not the loan is made hereunder, Borrower agrees to pay, or reimburse the Lender, for actual out-of-pocket expenses, including reasonable counsel fees (including without limitation attorneys' fees incurred in the trial court and upon any appeal), incurred by the Lender in connection with the preparation, negotiation, delivery and enforcement of this Agreement and the other Loan Documents, and the preservation of any rights under this Agreement and the other Loan Documents. 9.10 LIENS; SET OFF BY LENDER. Borrower hereby grants to the Lender a continuing lien for the Notes and all other Obligations upon any and all monies, securities and other property of the Borrower and the proceeds thereof, now or hereafter held or received by or in transit to, the Lender from or for the Borrower, and also upon any and all deposits (general or special) (other than trust accounts or any other accounts for which Borrower is acting as a fiduciary for third parties) and credits of the Borrower, if any, against the Lender, at any time existing. Upon the occurrence of any Event of Default as specified above, the Lender is hereby authorized at any time and from time to time, without notice to Borrower, to set off, appropriate and apply any or all items hereinabove referred to against all indebtedness of the Borrower to the Lender, whether under this Agreement, the Notes or otherwise, whether now existing or hereafter arising. The Lender undertakes to give Borrower notice of exercise by the Lender of its rights under this SECTION 9.10 subsequent to 40

taking such action, but the failure to give such notice shall not affect the validity of such action by Lender. 9.11 ASSIGNMENT. The terms hereof shall be binding upon and inure to the benefit of the successors and assigns of the parties hereto; provided, however, that the Borrower shall not assign this Agreement or any of its rights, interests, duties or obligations hereunder or any loan proceeds or other moneys to be advanced hereunder in whole or in part without the prior written consent of the Lender and that any such assignment (whether voluntary or by operation of law) without said consent shall be void. 9.12 INDEMNITY. Borrower agrees to defend, protect, indemnify and hold harmless the Lender, all directors, officers, employees, attorneys, and agents of Lender, from and against all claims, actions, liabilities, damages, costs and expenses (including, without limitation, all reasonable attorneys', legal assistants', and experts' fees, costs and expenses incurred in the investigation or defense of any matter) asserted against, imposed upon or incurred by Lender or any of such other persons, whether direct, indirect or consequential and whether based on any federal or state laws or other statutes or regulations (including, without limitation, securities, commercial and environmental laws and regulations), under common law or on equitable cause, or on contract or otherwise, as a

taking such action, but the failure to give such notice shall not affect the validity of such action by Lender. 9.11 ASSIGNMENT. The terms hereof shall be binding upon and inure to the benefit of the successors and assigns of the parties hereto; provided, however, that the Borrower shall not assign this Agreement or any of its rights, interests, duties or obligations hereunder or any loan proceeds or other moneys to be advanced hereunder in whole or in part without the prior written consent of the Lender and that any such assignment (whether voluntary or by operation of law) without said consent shall be void. 9.12 INDEMNITY. Borrower agrees to defend, protect, indemnify and hold harmless the Lender, all directors, officers, employees, attorneys, and agents of Lender, from and against all claims, actions, liabilities, damages, costs and expenses (including, without limitation, all reasonable attorneys', legal assistants', and experts' fees, costs and expenses incurred in the investigation or defense of any matter) asserted against, imposed upon or incurred by Lender or any of such other persons, whether direct, indirect or consequential and whether based on any federal or state laws or other statutes or regulations (including, without limitation, securities, commercial and environmental laws and regulations), under common law or on equitable cause, or on contract or otherwise, as a result of or arising from or relating to this Agreement, the Loan Documents or the transactions contemplated hereby or any credit extended or used hereunder or any act done or omitted by any person, or any event occurring, in connection therewith, or the exercise of any rights or remedies thereunder, including without limitation the acquisition of the property securing any loans by the Lender by way of foreclosure of the lien thereof, deed in lieu of such foreclosure or otherwise resulting, directly or indirectly, from any action or inaction on the part of Borrower, except only the recklessness or willful misconduct of the person otherwise to be indemnified hereunder. In the event this indemnity is unenforceable as a matter of law as to a particular matter or consequence referred to herein, it shall be enforceable to the full extent permitted by law. The obligations under this paragraph are independent of all other rights and obligations set forth herein and shall survive the consummation and payment of the loans evidenced by the Notes. 9.13 ENTIRE AGREEMENT. This Agreement constitutes the entire agreement between the parties pertaining to its subject matter and supersedes all prior and contemporaneous agreements and understandings of the parties in connection with it. [signatures follow] 41

IN WITNESS WHEREOF, the Borrower and the Lender have caused this Agreement to be duly executed by their duly authorized officers, all on the day and year first above written. BLUEGREEN PROPERTIES OF VIRGINIA, INC.
By: /s/ THOMAS W. GOSS ----------------------------------Name: Thomas W. Goss Title: Vice President

BRANCH BANKING AND TRUST COMPANY
By: /s/ MARK CAYTON ----------------------------------Name: Vice President Title: Vice President

42

EXHIBIT 10.152

IN WITNESS WHEREOF, the Borrower and the Lender have caused this Agreement to be duly executed by their duly authorized officers, all on the day and year first above written. BLUEGREEN PROPERTIES OF VIRGINIA, INC.
By: /s/ THOMAS W. GOSS ----------------------------------Name: Thomas W. Goss Title: Vice President

BRANCH BANKING AND TRUST COMPANY
By: /s/ MARK CAYTON ----------------------------------Name: Vice President Title: Vice President

42

EXHIBIT 10.152 MODIFICATION NUMBER TWO TO THE LOAN AGREEMENT (Amended and Restated) First Union National Bank 214 North Hogan Street - FL0070 Jacksonville, Florida 32202 (Hereinafter referred to as the "Bank") Bluegreen Corporation 4960 Blue Lake Drive Boca Raton, Florida 33431 Bluegreen Resorts Management, Inc. f/k/a RDI Resort Services Corporation 4960 Blue Lake Drive Boca Raton, Florida 33431 Bluegreen Vacations Unlimited, Inc. Successor by merger to Bluegreen Resorts, Inc. And Dellona Enterprises, Inc. 4960 Blue Lake Drive Boca Raton, Florida 33431 Bluegreen Holding Corporation (Texas) 4960 Blue Lake Drive Boca Raton, Florida 33431 Properties of the Southwest One, Inc. 4960 Blue Lake Drive Boca Raton, Florida 33431 Bluegreen Southwest One, L.P. f/k/a Properties of the Southwest, L.P. 4960 Blue Lake Drive Boca Raton, Florida 33431

EXHIBIT 10.152 MODIFICATION NUMBER TWO TO THE LOAN AGREEMENT (Amended and Restated) First Union National Bank 214 North Hogan Street - FL0070 Jacksonville, Florida 32202 (Hereinafter referred to as the "Bank") Bluegreen Corporation 4960 Blue Lake Drive Boca Raton, Florida 33431 Bluegreen Resorts Management, Inc. f/k/a RDI Resort Services Corporation 4960 Blue Lake Drive Boca Raton, Florida 33431 Bluegreen Vacations Unlimited, Inc. Successor by merger to Bluegreen Resorts, Inc. And Dellona Enterprises, Inc. 4960 Blue Lake Drive Boca Raton, Florida 33431 Bluegreen Holding Corporation (Texas) 4960 Blue Lake Drive Boca Raton, Florida 33431 Properties of the Southwest One, Inc. 4960 Blue Lake Drive Boca Raton, Florida 33431 Bluegreen Southwest One, L.P. f/k/a Properties of the Southwest, L.P. 4960 Blue Lake Drive Boca Raton, Florida 33431 Bluegreen Asset Management Corporation Successor by merger to Bluegreen Corporation of Montana 4960 Blue Lake Drive Boca Raton, Florida 33431 Bluegreen Carolina Lands, LLC, Successor by merger to Bluegreen Carolina Land, Inc. 4960 Blue Lake Drive Boca Raton, Florida 33431 Bluegreen Corporation of Tennessee 4960 Blue Lake Drive Boca Raton, Florida 33431 1

Bluegreen Corporation of the Rockies 4960 Blue Lake Drive Boca Raton, Florida 33431 Bluegreen Properties of Virginia, Inc.

Bluegreen Corporation of the Rockies 4960 Blue Lake Drive Boca Raton, Florida 33431 Bluegreen Properties of Virginia, Inc. 4960 Blue Lake Drive Boca Raton, Florida 33431 Bluegreen Resorts International, Inc. 4960 Blue Lake Drive Boca Raton, Florida 33431 Carolina National Golf Club, Inc. 4960 Blue Lake Drive Boca Raton, Florida 33431 Leisure Capital Corporation 4960 Blue Lake Drive Boca Raton, Florida 33431 Bluegreen West Corporation f/k/a Bluegreen Properties of the West, Inc., 4960 Blue Lake Drive Boca Raton, Florida 33431 BG/RDI Acquisition Corp. 4960 Blue Lake Drive Boca Raton, Florida 33431 Bluegreen Corporation Great Lakes (WI) 4960 Blue Lake Drive Boca Raton, Florida 33431 Bluegreen Corporation of Canada 4960 Blue Lake Drive Boca Raton, Florida 33431 Bluegreen Golf Clubs, Inc. 4960 Blue Lake Drive Boca Raton, Florida 33431 Bluegreen Interiors, LLC 4960 Blue Lake Drive Boca Raton, Florida 33431 Bluegreen Southwest Land, Inc. 4960 Blue Lake Drive Boca Raton, Florida 33431 New England Advertising Corp. 4960 Blue Lake Drive Boca Raton, Florida 33431 South Florida Aviation, Inc. 4960 Blue Lake Drive Boca Raton, Florida 33431 Winding River Realty, Inc. 4960 Blue Lake Drive

Boca Raton, Florida 33431 THIS AGREEMENT is entered into as of November 3, 1999 by and between Bank and Borrower. 2

RECITALS Bank is the holder of a Renewal Promissory Note executed and delivered by Borrower, dated August 1, 1999, in the original principal amount of $5,000,000.00 (the "Note"); and certain other Loan Documents (the "Line of Credit"), including a Loan Agreement, dated September 23, 1998 as modified by Modification Number One to Loan Agreement dated August 1, 1999 (the "Loan Agreement"); and Borrower and Bank have agreed to modify the terms of the Note and the Loan Agreement and increase the amount of the Line of Credit to $10,000,000.00. In consideration of Bank's continued extension of credit and the agreements contained herein, the parties agree as follows: AGREEMENT OUTSTANDING BALANCE. Borrower acknowledges that the most recent Commercial Loan Invoice sent to Borrower with respect to the Obligations under the Line of Credit is correct. MODIFICATIONS. Relying upon the covenants, agreements, representations and warranties contained herein, the Loan Agreement is hereby amended and restated as follows: INCREASE LINE OF CREDIT - The Bank and the Borrower hereby increase the Line of Credit to the principal amount of $10,000,000.00 which shall be evidenced by a Consolidated Promissory Note dated as of November 3, 1999 in the principal amount of $10,000,000.00 (the "Consolidated Note"), under which Borrower may borrow, repay, and reborrow, from time to time, so long as the total indebtedness outstanding at any one time does not exceed the principal amount minus the sum of (i) the amount available to be drawn plus (ii) the amount of unreimbursed drawings under all letters of credit issued by Bank for the account of Borrower. The Loan proceeds are to be used by Borrower solely for short term working capital and to issue letters of credit from time to time. The total amount of letters of credit to be issued under the Line of Credit shall not exceed $1,000,000.00 at any time nor have expirations after December 31, 2000. Bank's obligation to advance or readvance under the Consolidated Note shall terminate if Borrower is in Default under the Consolidated Note. Borrower shall pay Bank an Availability Fee for the Line of Credit more particularly described in the Consolidated Promissory Note. REPRESENTATIONS. Borrower represents that from the date of this Agreement and until final payment in full of the Obligations: Accurate Information. All information now and hereafter furnished to Bank is and will be true, correct and complete. Any such information relating to Borrower's financial condition will accurately reflect Borrower's financial condition as of the date(s) thereof, (including all contingent liabilities of every type), and Borrower further represents that its financial condition has not changed materially or adversely since the date(s) of such documents. Authorization; Non-Contravention. The execution, delivery and performance by Borrower and any guarantor, as applicable, of this Agreement and other Loan Documents to which it is a party are within its power, have been duly authorized by all necessary action taken by the duly authorized officers of Borrower and any guarantors and, if necessary, by making appropriate filings with any governmental agency or unit and are the legal, binding, valid and enforceable obligations of Borrower and any guarantors; and do not (i) contravene, or constitute (with or without the giving of notice or lapse of time or both) a violation of any provision of applicable law, a violation of the organizational documents of Borrower or any guarantor, or a default under any agreement, judgment, injunction, order, decree or other instrument binding upon or affecting Borrower or any guarantor, (ii) result in the creation or imposition of any 3

RECITALS Bank is the holder of a Renewal Promissory Note executed and delivered by Borrower, dated August 1, 1999, in the original principal amount of $5,000,000.00 (the "Note"); and certain other Loan Documents (the "Line of Credit"), including a Loan Agreement, dated September 23, 1998 as modified by Modification Number One to Loan Agreement dated August 1, 1999 (the "Loan Agreement"); and Borrower and Bank have agreed to modify the terms of the Note and the Loan Agreement and increase the amount of the Line of Credit to $10,000,000.00. In consideration of Bank's continued extension of credit and the agreements contained herein, the parties agree as follows: AGREEMENT OUTSTANDING BALANCE. Borrower acknowledges that the most recent Commercial Loan Invoice sent to Borrower with respect to the Obligations under the Line of Credit is correct. MODIFICATIONS. Relying upon the covenants, agreements, representations and warranties contained herein, the Loan Agreement is hereby amended and restated as follows: INCREASE LINE OF CREDIT - The Bank and the Borrower hereby increase the Line of Credit to the principal amount of $10,000,000.00 which shall be evidenced by a Consolidated Promissory Note dated as of November 3, 1999 in the principal amount of $10,000,000.00 (the "Consolidated Note"), under which Borrower may borrow, repay, and reborrow, from time to time, so long as the total indebtedness outstanding at any one time does not exceed the principal amount minus the sum of (i) the amount available to be drawn plus (ii) the amount of unreimbursed drawings under all letters of credit issued by Bank for the account of Borrower. The Loan proceeds are to be used by Borrower solely for short term working capital and to issue letters of credit from time to time. The total amount of letters of credit to be issued under the Line of Credit shall not exceed $1,000,000.00 at any time nor have expirations after December 31, 2000. Bank's obligation to advance or readvance under the Consolidated Note shall terminate if Borrower is in Default under the Consolidated Note. Borrower shall pay Bank an Availability Fee for the Line of Credit more particularly described in the Consolidated Promissory Note. REPRESENTATIONS. Borrower represents that from the date of this Agreement and until final payment in full of the Obligations: Accurate Information. All information now and hereafter furnished to Bank is and will be true, correct and complete. Any such information relating to Borrower's financial condition will accurately reflect Borrower's financial condition as of the date(s) thereof, (including all contingent liabilities of every type), and Borrower further represents that its financial condition has not changed materially or adversely since the date(s) of such documents. Authorization; Non-Contravention. The execution, delivery and performance by Borrower and any guarantor, as applicable, of this Agreement and other Loan Documents to which it is a party are within its power, have been duly authorized by all necessary action taken by the duly authorized officers of Borrower and any guarantors and, if necessary, by making appropriate filings with any governmental agency or unit and are the legal, binding, valid and enforceable obligations of Borrower and any guarantors; and do not (i) contravene, or constitute (with or without the giving of notice or lapse of time or both) a violation of any provision of applicable law, a violation of the organizational documents of Borrower or any guarantor, or a default under any agreement, judgment, injunction, order, decree or other instrument binding upon or affecting Borrower or any guarantor, (ii) result in the creation or imposition of any 3

lien (other than the lien(s) created by the Loan Documents) on any of Borrower's or guarantor's assets, or (iii) give cause for the acceleration of any obligations of Borrower or any guarantor to any other creditor. Asset Ownership. Borrower has good and marketable title to all of the properties and assets reflected on the balance sheets and financial statements supplied Bank by Borrower, and all such properties and assets are free and clear of mortgages, security deeds, pledges, liens, charges, and all other encumbrances, except as otherwise disclosed to Bank by Borrower in writing ("Permitted Liens"). To Borrower's knowledge, no default has occurred under

lien (other than the lien(s) created by the Loan Documents) on any of Borrower's or guarantor's assets, or (iii) give cause for the acceleration of any obligations of Borrower or any guarantor to any other creditor. Asset Ownership. Borrower has good and marketable title to all of the properties and assets reflected on the balance sheets and financial statements supplied Bank by Borrower, and all such properties and assets are free and clear of mortgages, security deeds, pledges, liens, charges, and all other encumbrances, except as otherwise disclosed to Bank by Borrower in writing ("Permitted Liens"). To Borrower's knowledge, no default has occurred under any Permitted Liens and no claims or interests adverse to Borrower's present rights in its properties and assets have arisen. Discharge of Liens and Taxes. Borrower has duly filed, paid and/or discharged all taxes or other claims which may become a lien on any of its property or assets, except to the extent that such items are being appropriately contested in good faith and an adequate reserve for the payment thereof is being maintained. Sufficiency of Capital. Borrower is not, and after consummation of this Agreement and after giving effect to all indebtedness incurred and liens created by Borrower in connection with the Loan, will not be, insolvent within the meaning of 11 U.S.C. ss. 101(32). Compliance with Laws. Borrower is in compliance in all respects with all federal, state and local laws, rules and regulations applicable to its properties, operations, business, and finances, including, without limitation, any federal or state laws relating to liquor (including 18 U.S.C. ss. 3617, et seq.) or narcotics (including 21 U.S.C.ss. 801, et seq.) and/or any commercial crimes; all applicable federal, state and local laws and regulations intended to protect the environment; and the Employee Retirement Income Security Act of 1974, as amended ("ERISA"), if applicable. Organization and Authority. Each corporate or limited liability company Borrower and any guarantor, as applicable, is duly created, validly existing and in good standing under the laws of the state of its organization, and has all powers, governmental licenses, authorizations, consents and approvals required to operate its business as now conducted. Each corporate or limited liability company Borrower and any guarantor, if any, is duly qualified, licensed and in good standing in each jurisdiction where qualification or licensing is required by the nature of its business or the character and location of its property, business or customers, and in which the failure to so qualify or be licensed, as the case may be, in the aggregate, could have a material adverse effect on the business, financial position, results of operations, properties or prospects of Borrower or any such guarantor. No Litigation. There are no pending or threatened suits, claims or demands against Borrower or any guarantor that have not been disclosed to Bank by Borrower in writing. ERISA. Each employee pension benefit plan, as defined in ERISA, maintained by Borrower meets, as of the date hereof, the minimum funding standards of ERISA and all applicable regulations thereto and requirements thereof, and of the Internal Revenue Code of 1954, as amended. No "Prohibited Transaction" or "Reportable Event" (as both terms are defined by ERISA) has occurred with respect to any such plan. AFFIRMATIVE COVENANTS. Borrower agrees that from the date of this Agreement and until final payment in full of the Obligations, unless Bank shall otherwise consent in writing, Borrower will: Business Continuity. Conduct its business in substantially the same manner and locations as such business is now and has previously been conducted. Maintain Properties. Maintain, preserve and keep its property in good repair, working order and condition, making all needed replacements, additions and improvements thereto, to the extent allowed by this Agreement. Access to Books & Records. Allow Bank, or its agents, during normal business hours, access to the books, records and such other documents of Borrower as Bank shall reasonably require, and allow Bank to make copies thereof at Bank's expense. Insurance. Maintain adequate insurance coverage with respect to its properties and business against loss or damage of the kinds and in the amounts customarily insured against by companies of established reputation engaged in the same or similar businesses including, without limitation, commercial general liability insurance, workers compensation insurance, and business interruption insurance; all acquired in such amounts and from such companies as Bank may reasonably require. Notice of Default and Other Notices. (a) Notice of Default. Furnish to Bank immediately upon becoming aware of the existence of any condition or event which constitutes a Default (as defined in the Loan Documents) or any event which, upon the giving of notice or lapse of time or both, may become a Default, written notice specifying the nature and period of existence thereof and the action which Borrower is taking or proposes to take with respect thereto. (b) Other Notices. Promptly notify Bank in writing of (i) any material adverse change in its financial condition or its business; (ii) any default under any material agreement, contract or other instrument to which it is a party or by which any of its properties are bound, or any acceleration of the maturity of any indebtedness owing by Borrower; (iii) any material adverse claim against or affecting Borrower or any part of its properties; (iv) the commencement of, and any material determination in, any litigation with any third party or any 4

proceeding before any governmental agency or unit affecting Borrower; and (v) at least 30 days prior thereto,

proceeding before any governmental agency or unit affecting Borrower; and (v) at least 30 days prior thereto, any change in Borrower's name or address as shown above, and/or any change in Borrower's structure. Compliance with Other Agreements. Comply with all terms and conditions contained in this Agreement, and any other Loan Documents, and swap agreements, if applicable, as defined in the Note. Payment of Debts. Pay and discharge when due, and before subject to penalty or further charge, and otherwise satisfy before maturity or delinquency, all obligations, debts, taxes, and liabilities of whatever nature or amount, except those which Borrower in good faith disputes. Reports and Proxies. Deliver to Bank, promptly, a copy of all financial statements, reports, notices, and proxy statements, sent by Borrower to stockholders, and all regular or periodic reports required to be filed by Borrower with any governmental agency or authority. Other Financial Information. Deliver promptly such other information regarding the operation, business affairs, and financial condition of Borrower which Bank may reasonably request. Non-Default Certificate From Borrower. Deliver to Bank, with the Financial Statements required herein, a certificate signed by Borrower, if Borrower is an individual, or by a principal financial officer of Borrower warranting that no "Default" as specified in the Loan Documents nor any event which, upon the giving of notice or lapse of time or both, would constitute such a Default, has occurred. Estoppel Certificate. Furnish, within 15 days after request by Bank, a written statement duly acknowledged of the amount due under the Loan and whether offsets or defenses exist against the Obligations. NEGATIVE COVENANTS. Borrower agrees that from the date of this Agreement and until final payment in full of the Obligations, unless Bank shall otherwise consent in writing, Borrower will not: Default on Other Contracts or Obligations. Default on any material contract with or obligation when due to a third party or default in the performance of any obligation to a third party incurred for money borrowed. Judgment Entered. Permit the entry of any monetary judgment or the assessment against, the filing of any tax lien against, or the issuance of any writ of garnishment or attachment against any property of or debts due Borrower. Government Intervention. Permit the assertion or making of any seizure, vesting or intervention by or under authority of any government by which the management of Borrower or any guarantor is displaced of its authority in the conduct of its respective business or such business is curtailed or materially impaired. Prepayment of Other Debt. Retire any long-term debt entered into prior to the date of this Agreement in advance of its legal obligation to do so. Retire or Repurchase Capital Stock. Retire or otherwise acquire any of its capital stock, except as permitted by waiver letter from Bank to Borrower dated May 13, 1999 authorizing the repurchase of up to two million shares of capital stock under the Borrower's existing share repurchase plan. FINANCIAL COVENANTS. Borrower agrees to the following provisions from the date hereof until final payment in full of the Obligations, unless Bank shall otherwise consent in writing: Adjusted Tangible Net Worth. Borrower shall, at all times, maintain an Adjusted Tangible Net Worth of at least $145,000,000.00. "Adjusted Tangible Net Worth" shall mean the total assets minus total liabilities. For purposes of this computation, the aggregate amount of any intangible assets of Borrower including, without limitation, goodwill, franchises, licenses, patents, trademarks, trade names, copyrights, service marks, and brand names, shall be subtracted from total assets, and total liabilities shall exclude debt subordinated. Adjusted Total Liabilities to Adjusted Tangible Net Worth Ratio. Borrower shall, at all times, maintain a ratio of Adjusted Total Liabilities to Adjusted Tangible Net Worth of not more than 2.00 to 1.00. For purposes of this computation, "Adjusted Total Liabilities" shall mean the sum of total liabilities, including capitalized leases and all reserves for deferred taxes and other deferred sums appearing on the liabilities side of a balance sheet, in accordance with generally accepted accounting principles applied on a consistent basis, excluding debt subordinated. Liquidity Requirement. Borrower shall at all times, maintain unrestricted cash and unencumbered timeshare receivables of not less than $20,000,000.00. Deposit Relationship. Borrower shall maintain its primary depository account with Bank. Compliance Certificate. Borrower shall furnish Bank with a quarterly covenant compliance certificate demonstrating Borrower's compliance with the above Financial Covenants. ANNUAL FINANCIAL STATEMENTS. Borrower shall deliver to Bank, within 90 days after the close of each fiscal year, audited financial statements reflecting its operations during such fiscal year, including, without limitation, a balance sheet, profit and loss statement and statement of cash flows, with supporting schedules; all on a consolidated and consolidating basis and in reasonable detail, prepared in conformity with generally accepted accounting principles, applied on a basis consistent with that of the preceding year. All such statements shall be examined by an independent certified public accountant acceptable to Bank. The opinion of such independent certified public accountant 5

shall not be acceptable to Bank if qualified due to any limitations in scope imposed by Borrower or its Subsidiaries, if any. Any other qualification of the opinion by the accountant shall render the acceptability of the financial statements subject to Bank's approval. PERIODIC FINANCIAL STATEMENTS. Borrower shall deliver to Bank unaudited management-prepared quarterly financial statements, including, without limitation, a balance sheet, profit and loss statement and statement of cash flows, with supporting schedules, as soon as available and in any event within 45 days after the close of each such period; all in reasonable detail and prepared in conformity with generally accepted accounting principles, applied on a basis consistent with that of the preceding year. Such statements shall be certified as to their correctness by a principal financial officer of Borrower and in each case, if audited statements are required, subject to audit and year-end adjustments. FINANCIAL AND OTHER INFORMATION. Borrower shall deliver to Bank such information as Bank may reasonably request from time to time, including without limitation, financial statements and information pertaining to Borrower's financial condition. Such information shall be true, complete, and accurate. YEAR 2000 COMPATIBILITY. Borrower shall take all action necessary to assure that Borrower's computer based systems are able to operate and effectively process data including dates on and after January 1, 2000. At the request of Bank, Borrower shall provide Bank assurance acceptable to Bank of Borrower's Year 2000 compatibility. ACKNOWLEDGMENTS. Borrower acknowledges and represents that the Note and other Loan Documents, as amended hereby, are in full force and effect without any defense, counterclaim, right or claim of set-off; that, after giving effect to this Agreement, no default or event that with the passage of time or giving of notice would constitute a default under the Loan Documents has occurred; that all representations and warranties contained in the Loan Documents are true and correct as of this date; that Borrower has taken all necessary action to authorize the execution and delivery of this Agreement; and that this Agreement is a modification of an existing obligation and is not a novation. MISCELLANEOUS. This Agreement applies to the Loan, Line of Credit and all Loan Documents. The terms "Loan Documents" and "Obligations," as used in this Agreement, are defined in the Note. The term "Borrower" shall include its Subsidiaries and Affiliates. As used in this Agreement as to Borrower, "Subsidiary" shall mean any corporation of which more than 50% of the issued and outstanding voting stock is owned directly or indirectly by Borrower. As to Borrower, "Affiliate" shall have the meaning as defined in 11 U.S.C. ss. 101, except that the term "debtor" therein shall be substituted by the term "Borrower" herein. This Agreement shall be construed in accordance with and governed by the laws of the applicable state as originally provided in the Loan Documents, without reference to that state's conflicts of laws principles. This Agreement and the other Loan Documents constitute the sole agreement of the parties with respect to the subject matter thereof and supersede all oral negotiations and prior writings with respect to the subject matter thereof. No amendment of this Agreement, and no waiver of any one or more of the provisions hereof shall be effective unless set forth in writing and signed by the parties hereto. The illegality, unenforceability or inconsistency of any provision of this Agreement shall not in any way affect or impair the legality, enforceability or consistency of the remaining provisions of this Agreement or the other Loan Documents. This Agreement and the other Loan Documents are intended to be consistent. However, in the event of any inconsistencies among this Agreement and any of the Loan Documents, the terms of this Agreement, and then the Note, shall control. This Agreement may be executed in any number of counterparts and by the different parties on separate counterparts. Each such counterpart shall be deemed an original, but all such counterparts shall together constitute one and the same agreement. Terms used in this Agreement which are capitalized and not otherwise defined herein shall have the meanings ascribed to such terms in the Loan Documents. CONDITIONS SUBSEQUENT TO CLOSING FOR LOAN ADVANCES. The obligation to the Bank to make any loan advanes under the Line of Credit subsequent to closing are subject to the following post closing conditions which must be received, reviewed and be satisfactory to Bank: Certificates of Good Standing and Borrowing Authorizations. Each Borrower shall provide Bank with an original certificate of good standing issued by the state of its organization and provide Bank with a written corporate or partnership borrowing resolutions in a form satisfactory to Bank. IN WITNESS WHEREOF, the undersigned have signed and sealed this Agreement the day and year first above

written. 6

Bluegreen Corporation Taxpayer Identification Number: 03-0300793
CORPORATE SEAL By: /s/ PATRICK E. RONDEAU --------------------------------------Patrick E. Rondeau, Senior Vice President

Bluegreen Resorts Management, Inc. Taxpayer Identification Number: 65-0520217
CORPORATE SEAL By: /s/ PATRICK E. RONDEAU --------------------------------------Patrick E. Rondeau, President

Bluegreen Vacations Unlimited, Inc. Successor by merger to Bluegreen Resorts, Inc. And Dellona Enterprises, Inc. Taxpayer Identification Number: 65-0433722
CORPORATE SEAL By: /s/ PATRICK E. RONDEAU --------------------------------------Patrick E. Rondeau, President

Bluegreen Holding Corporation (Texas) Taxpayer Identification Number: 65-0796382
CORPORATE SEAL By: /s/ PATRICK E. RONDEAU --------------------------------------Patrick E. Rondeau, President

Properties of the Southwest One, Inc. Taxpayer Identification Number: 03-0315835
CORPORATE SEAL By: /s/ PATRICK E. RONDEAU --------------------------------------Patrick E. Rondeau, Executive Vice President

Bluegreen Southwest One, L.P., f/k/a Properties of the Southwest, L.P. By: Bluegreen Southwest Land, Inc., its: General Partner Taxpayer Identification Number: 65-0910609 7
CORPORATE SEAL By: /s/ PATRICK E. RONDEAU --------------------------------------Patrick E. Rondeau, Executive Vice President

Bluegreen Asset Management Corporation Successor by merger to Bluegreen Corporation of Montana Taxpayer Identification Number: 03-0325365
CORPORATE By: /s/ PATRICK E. RONDEAU

Bluegreen Corporation Taxpayer Identification Number: 03-0300793
CORPORATE SEAL By: /s/ PATRICK E. RONDEAU --------------------------------------Patrick E. Rondeau, Senior Vice President

Bluegreen Resorts Management, Inc. Taxpayer Identification Number: 65-0520217
CORPORATE SEAL By: /s/ PATRICK E. RONDEAU --------------------------------------Patrick E. Rondeau, President

Bluegreen Vacations Unlimited, Inc. Successor by merger to Bluegreen Resorts, Inc. And Dellona Enterprises, Inc. Taxpayer Identification Number: 65-0433722
CORPORATE SEAL By: /s/ PATRICK E. RONDEAU --------------------------------------Patrick E. Rondeau, President

Bluegreen Holding Corporation (Texas) Taxpayer Identification Number: 65-0796382
CORPORATE SEAL By: /s/ PATRICK E. RONDEAU --------------------------------------Patrick E. Rondeau, President

Properties of the Southwest One, Inc. Taxpayer Identification Number: 03-0315835
CORPORATE SEAL By: /s/ PATRICK E. RONDEAU --------------------------------------Patrick E. Rondeau, Executive Vice President

Bluegreen Southwest One, L.P., f/k/a Properties of the Southwest, L.P. By: Bluegreen Southwest Land, Inc., its: General Partner Taxpayer Identification Number: 65-0910609 7
CORPORATE SEAL By: /s/ PATRICK E. RONDEAU --------------------------------------Patrick E. Rondeau, Executive Vice President

Bluegreen Asset Management Corporation Successor by merger to Bluegreen Corporation of Montana Taxpayer Identification Number: 03-0325365
CORPORATE SEAL By: /s/ PATRICK E. RONDEAU --------------------------------------Patrick E. Rondeau, President

CORPORATE SEAL

By: /s/ PATRICK E. RONDEAU --------------------------------------Patrick E. Rondeau, Executive Vice President

Bluegreen Asset Management Corporation Successor by merger to Bluegreen Corporation of Montana Taxpayer Identification Number: 03-0325365
CORPORATE SEAL By: /s/ PATRICK E. RONDEAU --------------------------------------Patrick E. Rondeau, President

Bluegreen Carolina Lands, LLC Successor by merger to Bluegreen Carolina Land, Inc. Taxpayer Identification Number: 65-0941345
CORPORATE SEAL By: /s/ PATRICK E. RONDEAU --------------------------------------Patrick E. Rondeau, President

Bluegreen Corporation of Tennessee Taxpayer Identification Number: 03-0316460
CORPORATE SEAL By: /s/ PATRICK E. RONDEAU --------------------------------------Patrick E. Rondeau, President

Bluegreen Corporation of the Rockies Taxpayer Identification Number: 65-0349373
CORPORATE SEAL By: /s/ PATRICK E. RONDEAU --------------------------------------Patrick E. Rondeau, President

Bluegreen Corporation of Virginia, Inc. Taxpayer Identification Number: 52-1752664 8
CORPORATE SEAL By: /s/ PATRICK E. RONDEAU --------------------------------------Patrick E. Rondeau, President

Bluegreen Resorts International, Inc. Taxpayer Identification Number: 65-0803615
CORPORATE SEAL By: /s/ PATRICK E. RONDEAU --------------------------------------Patrick E. Rondeau, President

Carolina National Golf Club, Inc. Taxpayer Identification Number: 62-1667685
CORPORATE SEAL By: /s/ PATRICK E. RONDEAU --------------------------------------Patrick E. Rondeau, President

Leisure Capital Corporation Taxpayer Identification Number: 03-0327285

CORPORATE SEAL

By: /s/ PATRICK E. RONDEAU --------------------------------------Patrick E. Rondeau, President

Bluegreen Resorts International, Inc. Taxpayer Identification Number: 65-0803615
CORPORATE SEAL By: /s/ PATRICK E. RONDEAU --------------------------------------Patrick E. Rondeau, President

Carolina National Golf Club, Inc. Taxpayer Identification Number: 62-1667685
CORPORATE SEAL By: /s/ PATRICK E. RONDEAU --------------------------------------Patrick E. Rondeau, President

Leisure Capital Corporation Taxpayer Identification Number: 03-0327285
CORPORATE SEAL By: /s/ PATRICK E. RONDEAU --------------------------------------Patrick E. Rondeau, President

Bluegreen West Corporation f/k/a Bluegreen Properties of the West, Inc. Taxpayer Identification Number: 593300205
CORPORATE SEAL By: /s/ PATRICK E. RONDEAU --------------------------------------Patrick E. Rondeau, President

BG/RDI Acquisition Corp. Taxpayer Identification Number: 65-0776572
CORPORATE SEAL By: /s/ PATRICK E. RONDEAU --------------------------------------Patrick E. Rondeau, President

Bluegreen Corporation Great Lakes (WI) Taxpayer Identification Number: 36-3520208
CORPORATE SEAL By: /s/ PATRICK E. RONDEAU --------------------------------------Patrick E. Rondeau, Secretary

Bluegreen Corporation of Canada Taxpayer Identification Number: 03-0311034
CORPORATE SEAL By: /s/ PATRICK E. RONDEAU --------------------------------------Patrick E. Rondeau, Secretary

Bluegreen Golf Clubs, Inc. Taxpayer Identification Number: 65-0912659
CORPORATE SEAL By: /s/ PATRICK E. RONDEAU --------------------------------------Patrick E. Rondeau, Secretary

Patrick E. Rondeau, Secretary

Bluegreen Interiors, LLC Taxpayer Identification Number: 65-0929952 9
CORPORATE SEAL By: /s/ PATRICK E. RONDEAU --------------------------------------Patrick E. Rondeau, President

Bluegreen Southwest Land, Inc. Taxpayer Identification Number: 65-0910609
CORPORATE SEAL By: /s/ PATRICK E. RONDEAU --------------------------------------Patrick E. Rondeau, President

New England Advertising Corp. Taxpayer Identification Number: 03-0295158
CORPORATE SEAL By: /s/ PATRICK E. RONDEAU --------------------------------------Patrick E. Rondeau, President

South Florida Aviation, Inc. Taxpayer Identification Number: 65-0341038
CORPORATE SEAL By: /s/ PATRICK E. RONDEAU --------------------------------------Patrick E. Rondeau, President

Winding River Realty, Inc. Taxpayer Identification Number: 56-2095309
CORPORATE SEAL By: /s/ PATRICK E. RONDEAU --------------------------------------Patrick E. Rondeau, President

Frist Union National Bank
CORPORATE SEAL By: /s/ JACQUELINE LEDEA --------------------------------------Jacqueline Ledea, Vice President

10
ARTICLE 5 MULTIPLIER: 1,000

PERIOD TYPE FISCAL YEAR END PERIOD START PERIOD END CASH SECURITIES RECEIVABLES

6 MOS APR 02 2000 MAR 29 1999 OCT 03 1999 43,842 15,717 98,358

CORPORATE SEAL

By: /s/ PATRICK E. RONDEAU --------------------------------------Patrick E. Rondeau, President

Bluegreen Southwest Land, Inc. Taxpayer Identification Number: 65-0910609
CORPORATE SEAL By: /s/ PATRICK E. RONDEAU --------------------------------------Patrick E. Rondeau, President

New England Advertising Corp. Taxpayer Identification Number: 03-0295158
CORPORATE SEAL By: /s/ PATRICK E. RONDEAU --------------------------------------Patrick E. Rondeau, President

South Florida Aviation, Inc. Taxpayer Identification Number: 65-0341038
CORPORATE SEAL By: /s/ PATRICK E. RONDEAU --------------------------------------Patrick E. Rondeau, President

Winding River Realty, Inc. Taxpayer Identification Number: 56-2095309
CORPORATE SEAL By: /s/ PATRICK E. RONDEAU --------------------------------------Patrick E. Rondeau, President

Frist Union National Bank
CORPORATE SEAL By: /s/ JACQUELINE LEDEA --------------------------------------Jacqueline Ledea, Vice President

10
ARTICLE 5 MULTIPLIER: 1,000

PERIOD TYPE FISCAL YEAR END PERIOD START PERIOD END CASH SECURITIES RECEIVABLES ALLOWANCES INVENTORY CURRENT ASSETS PP&E DEPRECIATION TOTAL ASSETS CURRENT LIABILITIES BONDS PREFERRED MANDATORY

6 MOS APR 02 2000 MAR 29 1999 OCT 03 1999 43,842 15,717 98,358 3,471 172,279 01 37,968 7,436 380,717 01 209,415 0

ARTICLE 5 MULTIPLIER: 1,000

PERIOD TYPE FISCAL YEAR END PERIOD START PERIOD END CASH SECURITIES RECEIVABLES ALLOWANCES INVENTORY CURRENT ASSETS PP&E DEPRECIATION TOTAL ASSETS CURRENT LIABILITIES BONDS PREFERRED MANDATORY PREFERRED COMMON OTHER SE TOTAL LIABILITY AND EQUITY SALES TOTAL REVENUES CGS TOTAL COSTS OTHER EXPENSES LOSS PROVISION INTEREST EXPENSE INCOME PRETAX INCOME TAX INCOME CONTINUING DISCONTINUED EXTRAORDINARY CHANGES NET INCOME EPS BASIC EPS DILUTED
1

6 MOS APR 02 2000 MAR 29 1999 OCT 03 1999 43,842 15,717 98,358 3,471 172,279 01 37,968 7,436 380,717 01 209,415 0 0 251 124,428 380,717 128,365 146,216 42,822 50,540 0 2,324 6,630 16,675 6,503 10,287 0 0 0 10,287 0.44 0.38

THE COMPANY HAS AN UNCLASSIFIED BALANCE SHEET.