Housing Capital Company

                            PROMISSORY NOTE
                        SECURED BY DEED OF TRUST

$10,500,000                                          San Mateo, California

FOR VALUE RECEIVED, the undersigned TRACY RESIDENTIAL
VENTURE PARTNERS, LLC, a California limited liability company
("Borrower"), promises to pay to the order of HOUSING CAPITAL
COMPANY, a Minnesota Partnership, its successors or assigns ("Lender"),
at its office in Costa Mesa, California, or at such other place as may be
designated in writing by Lender, the principal sum of TEN MILLION FIVE
HUNDRED THOUSAND AND NO/100THS DOLLARS ($10,500,000.00)
or so much thereof as may be disbursed by Lender to or for the benefit or
account of Borrower, with interest thereon at the rate of ONE AND ONE
QUARTER OF ONE PERCENT (1.25%) per annum (based on a 360 day year
and charged on the basis of actual days elapsed) in excess of the "Reference
Rate" in effect from time to time. As used herein, the term "Reference Rate"
means the rate of interest from time to time publicly announced by U.S. Bank
National Association, Minneapolis, Minnesota ("USB"), as its reference rate,
even though USB may lend to its customers at rates that are at, below or above
the reference rate. Any change in the rate of interest on this Note due to a 
change in the Reference Rate shall become effective on the date each change 
in the Reference Rate becomes effective. All sums owing hereunder are payable in
lawful money of the United States of America.

This Note is executed and delivered pursuant to that certain Borrowing Base
Revolving Loan Agreement of even date herewith between Borrower and
Lender (the "Loan Agreement") and is secured by, among other things, that
certain Construction Deed of Trust with Assignment of Leases and Rents,
Security Agreement and Fixture Filing of even date herewith made by Borrower
as Trustor in favor of Lender as Beneficiary (the "Deed of Trust").

This Note is a "Revolving Credit Note" and as such allows the undersigned to
borrow, repay, and re-borrow funds subject to the restrictions and limitations 
set forth in the Loan Agreement. Lender shall enter in its ledgers and records 
the amount of each Advance and any payments made thereon, and Lender is
authorized by Borrower to enter into Lender's records all such Advances and
payments; provided, however that the failure by Lender to make any such entry
or any error in making such entry shall not limit or otherwise affect the rights
of Lender or the duties and obligations of Borrower under this Note or the other
Loan Documents, and, in all events, the principal amounts owing by Borrower
in respect of the Loan shall be the aggregate amount of all Advances made by
Lender, less all payments of principal made thereon by Borrower. The terms of
this Note shall apply with equal force and effect to the total Loan or any 
lesser amount then outstanding hereunder.

Interest accrued on this Note shall be due and payable on the first day of each
month commencing with the first month after the Effective Date (as defined in
the Loan Agreement).

The outstanding principal balance of this note, together with all accrued and
unpaid interest, shall be due and payable on the "Maturity Date", which is
defined as being twelve (12) months from the Effective Date as defined in the
Borrowing Base Revolving Loan Agreement, or any earlier date on which this
Note shall be required to be paid in full, whether by acceleration or otherwise.
Notwithstanding anything to the contrary contained herein, any outstanding
principal outstanding which is allocated to each Unit (as defined in the Loan
Agreement) shall be due and payable twelve (12) months from the date of the
initial advance for each Unit.

In order to assure timely payment of amounts and expenses due and owing to
Lender under the loan evidenced by this Note, Borrower hereby irrevocably
authorizes Lender to (a) disburse directly to Lender as provided in the Loan
Agreement or (b) directly debit the "Borrower's Funds Account", it any, (as
defined in the Loan Agreement) for payment when due of all such amounts and
expenses payable or reimbursable to Lender. Written notice of the amount and
purpose of any such direct debit shall be given to Borrower by Lender not less
than two (2) business days prior to its effective date; provided, however,
Lender's failure to give such notice shall not affect the validity of or 
Borrower's authorization of such debit. Amounts and expenses subject to this 
provision include, without limitation: accrued interest (after any available 
interest reserve); principal; late charges; fixed rate fees; loan origination 
fees; appraisal and cost engineering fees; legal fees (whether external or 
internal); loan administration fees; and loan transaction fees. A monthly 
statement showing the amounts and dates of such direct debits shall be 
provided by Lender to Borrower.

If any monthly payment required hereunder is not paid on or before the fifteenth
(15th) calendar day of the month in which it becomes due, Borrower shall pay,
at Lender's option, a late or collection charge equal to four percent (4%) of 
the amount of such unpaid monthly payment.

From and after the Maturity Date or the Conversion Maturity Date as the case
may be, or such earlier date as all sums owing on this Note become due and
payable by acceleration or otherwise, all sums owing on this Note shall bear
interest until paid in full at a rate equal to five percent (5%) per annum 
(based on a 360 day year and charged on the basis of actual days elapsed) in 
excess of the interest rate otherwise accruing under this Note (the "Default 
Rate").

If: (a) Borrower shall fail to pay when due any sums payable hereunder; or (b)
a Default or Event of Default occurs under the Deed of Trust, Loan Agreement
or under any other "Loan Document" (as defined in the Loan Agreement); or (c)
any "Transfer" (as defined in the Deed of Trust) occurs,. other than as 
expressly permitted by Lender in writing; THEN Lender may, at its sole option, 
declare all sums owing under this Note immediately due and payable; provided
however, that if any document related to this Note provides for automatic
acceleration of payment of sums owing hereunder, all sums owing hereunder
shall be automatically due and payable in accordance with the terms of that
document.

If any attorney is engaged by Lender to enforce or construe any provision of 
this Note or the Deed of Trust, or as a consequence of any Default or Event of
Default, with or without the filing of any legal action or proceeding, then
Borrower shall immediately pay on demand all reasonable attorneys' fees and
all other reasonable costs incurred by Lender, together with interest thereon
from the date of such demand until paid at the Default Rate of interest 
applicable to the principal owing hereunder as if such unpaid attorneys' fees 
and costs had been added to the principal. 

No previous waiver and no failure or delay by Lender in acting with respect to
the terms of this Note or the Deed of Trust shall constitute a waiver of any
breach, default, or failure of condition under this Note, the Deed of Trust or 
the obligations secured thereby. A waiver of any term of this Note, the Deed of
Trust or of any of the obligations secured thereby must be made in writing and
shall be limited to the express written terms of such waiver. In the event of 
any inconsistencies between the terms of this Note and the terms of any other
document related to the loan evidenced by this Note, the terms of this Note 
shall prevail.

Payments made under this Note shall be applied to any amounts owing
hereunder or under the "Loan Documents" (as defined in the Loan Agreement)
in such order and priority as Lender may elect in its sole discretion.

Borrower waives any right of offset it now has or may hereafter have against
Lender and agrees to make the payments called for herein without deduction or
counterclaim.

In no event whatsoever shall the amount of interest paid or agreed to be paid to
Lender pursuant to this Note or any of the Loan Documents exceed the highest
lawful rate of interest permissible under applicable law. If, from any
circumstances whatsoever, fulfillment of any provision of this Note or the other
Loan Documents shall involve exceeding the lawful rate of interest which a
court of competent jurisdiction may deem applicable hereto ("Excess Interest"),
then the obligation to be fulfilled shall be reduced to the highest lawful rate 
of interest permissible under such law and if, for any reason whatsoever, Lender
shall receive as interest an amount which would be deemed Excess Interest, such
Excess Interest shall be applied to principal (whether or not due and payable)
and not to the payment of interest or refunded to Borrower provided this Note
has been paid in full. Neither Borrower nor any guarantor or endorser shall have
any action against Lender for any damages whatsoever arising out of the
payment or collection of any such Excess Interest.

If this Note is executed by more than one person or entity as Borrower, the
obligations of each such person or entity shall be joint and several. No person
or entity shall be a mere accommodation maker, but each shall be primarily and
directly liable hereunder. Except as otherwise provided in any loan agreement
executed in connection with this Note, Borrower waives: presentment; demand;
notice of dishonor; notice of default or delinquency; notice of acceleration;
notice of protest and nonpayment; notice of costs, expenses or losses and
interest thereon; notice of late charges; and diligence in taking any action to
collect any sums owing under this Note or in proceeding against any of the
rights or interests in or to properties securing payment of this Note. Time is 
of the essence with respect to every provision hereof. This Note shall be 
construed and enforced in accordance with the laws of the State of California, 
except to the extent that Federal laws preempt the laws of the State of 
California, and all persons and entities in any manner obligated under this 
Note consent to the jurisdiction of any Federal or State Court within the 
State of California having proper venue and also consent to service of 
process by any means authorized by California (except the conflict of laws 
provisions thereof) or Federal law.


Date: July 22, 1998     "Borrower"

                        TRACY RESIDENTIAL VENTURE PARTNERS, LLC, a 
                        California limited liability company

                        BY:  WESTCO COMMUNITY BUILDERS, INC., a
                             California Corporation Member

                             By: /s/ Glen Britton Evans, Jr.
                                 Glen Britton Evans, Jr.                       
                                 Its: Executive Vice President
                             By: /s/ Jerry A. Finch
                                 Jerry A. Finch   
                                 Its: President

                        BY:  DOVER INVESTMENTS CORP., a Delaware
                             Corporation Member
                             By: /s/ Lawrence Weissberg
                                 Lawrence Weissberg
                                 Its: President






HOUSING CAPITAL COMPANY
1825 South Grant Street, Suite 630
San Mateo, CA 94402
Attn: Loan Administration
Loan No. 619R-08-09



                       CONSTRUCTION DEED OF TRUST
                  with Assignment of Leases and Rents,
                 Security Agreement and Fixture Filing

              THIS DEED OF TRUST IS A GLENBRIAR ESTATES DEED

       LOAN AGREEMENT PROVIDES FOR BORROWING AND RE-BORROWING OF PRINCIPAL
                 AND INTEREST AND FOR A VARIABLE INTEREST RATE.

THE PARTIES TO THIS DEED OF TRUST, made as of July 22, 1998, are
TRACY RESIDENTIAL VENTURE PARTNERS, LLC, a California limited
liability company ("Trustor"), CHICAGO TITLE COMPANY ("Trustee"), and
HOUSING CAPITAL COMPANY, a Minnesota Partnership ("Beneficiary").

ARTICLE 1. GRANT IN TRUST

1.1  Grant. For the purposes and upon the terms and conditions in this
Deed of Trust, Trustor irrevocably grants, conveys and assigns to Trustee, in 
trust for the benefit of Beneficiary, with power of sale and right of entry 
and possession, all that real property located in the County of San Joaquin, 
State of  California, described on Exhibit A attached hereto ("the "Real 
Property"), together with the following (all of  which together with said 
Real Property, is referred to herein as the "Subject Property");

(a)  All appurtenances, easements, rights and rights of way appurtenant or
related thereto;

(b)  All buildings, other improvements and fixtures now or hereafter located
thereon (the Improvements);

(c)  All goods, building and other materials, supplies, work in process,
equipment, machinery, fixtures, furniture, furnishings, signs and other
personal property, wherever situated, which are or are to be incorporated
into, used in connection with, or appropriated for use on, the Real Property;
together with all inventory, accounts, accounts receivable, contract rights,
general intangibles, chattel paper, instruments, documents, notes, drafts,
letters of credit, insurance policies, insurance and condemnation awards and
proceeds, trade names, trademarks and services marks arising from or related
to the Real Property and any business conducted thereon by Trustor;
together with all books records and files relating to any of the foregoing;

(d)  All sales contracts of any nature whatsoever now or hereafter executed
covering any portion of the Real Property or Improvements, together with
any modifications thereof, and also together with any and all deposits or
other payments made in connection therewith (subject, however, to any
applicable restrictions imposed by law);

(e)  All permits, certificates, licenses, approvals, contracts, entitlements and
authorizations, however characterized, issued or in any way furnished for the
acquisition, construction, development, operation and use of the Real
Property or Improvements, including warranties and guaranties, and all
deposits made with or other security given to utility companies and
governmental agencies with respect to the escrowed for completion of
Real Property or Improvements, and  all of Trustor's funds held back or       
escrowed for completion of offsite improvements in the vicinity of the Real   
Property or Improvements;

(f)  All rights of Trustor under any construction contracts and subcontracts,
architects' and engineers' contracts, plans, specifications and drawings for
the Improvements;

(g)  All rights of Trustor as declarant under any Declaration affecting any of
the Real Property;

(h)  All insurance policies (and unearned premiums thereon) and all proceeds
of insurance required to be carried by the terms of the Loan Documents;

(i)  Any evidence of title to the Subject Property provided by Trustor to
Beneficiary;

(j)  Any bank account(s) into which proceeds of the Secured Obligations are
deposited by Beneficiary for the benefit of Trustor; and

(k)  All interest or estate which Trustor may hereafter acquire in the 
property described above, and  all replacements, proceeds, additions and 
accretions thereto. The listing of specific rights or property shall not be 
interpreted as a limit of general terms.

1.2  Address. The address of the Subject Property (if known) is: not       
applicable at this time. However, neither the failure to designate an address 
nor any inaccuracy in the address designated shall affect the validity or 
priority of the lien of this Deed of Trust on the Subject Property as 
described on Exhibit A.

                     ARTICLE 2. OBLIGATIONS SECURED

2.1  Obligations Secured. Trustor makes this grant and assignment for the
purpose of securing the following obligations ("Secured Obligations"):

(a)  Payment to Beneficiary of all sums at any time owing under a promissory
note ("Note") of even date herewith, in the principal amount of TEN
MILLION FIVE HUNDRED THOUSAND AND NO/100THS DOLLARS
($10,500,000.00) executed by TRACY RESIDENTIAL VENTURE
PARTNERS, LLC, a California limited liability company, Trustor, and
payable to the order of Beneficiary; and

(b)  Payment and performance of all obligations of TRACY RESIDENTIAL
VENTURE PARTNERS, LLC, a California limited liability company, under
that certain Deed of Trust (the "A&D Deed of Trust") dated March 18, 1998
and recorded April 28, 1998 as Instrument No. 98048795 in the Office of the
County Recorder of San Joaquin County, California; and

(c)  Payment and performance of all obligations of Trustor under this Deed of
Trust and under any and all future deeds of trust which state that they are
future phase deeds of trust and/or Glenbriar Estates Deeds on or adjacent to
the Property; and

(d)  Payment and performance of all obligations of Trustor under a Borrowing
Base Revolving Loan Agreement ("Loan Agreement") of even date herewith
by and between Trustor as Borrower, and Beneficiary, as "Lender and any
and all other "Loan Documents" (as defined in the Loan Agreement); and

(e)  Payment and performance of all obligations, if any, which any rider
attached as an Exhibit to this Deed of Trust recites are secured hereby;
and

(f)  Payment and performance of all future advances and other obligations that
the then record owner of all or part of the Subject Property may agree to pay
and/or perform (whether as principal, surety or guarantor) for the benefit of
Beneficiary, when such future advance or obligation is evidenced by a
writing which recites that it is secured by this Deed of Trust; and
recites that it is secured by this Deed of Trust; and
<PAGE>
(g) All modifications, extensions and renewals of any of the obligations 
secured hereby, however evidenced, including, without limitation: (i) 
modifications of the required principal payment dates or interest payment 
dates or both, as the case may be, deferring or accelerating payment dates 
wholly or partly; or (ii) modifications, extensions or renewals at a different 
rate of interest whether or not in the case of a note, the modification, 
extension or renewal is evidenced by a new or additional promissory note.

2.2  Obligations. The term "obligations" is used herein in its broadest and  
most comprehensive sense and shall be deemed to include, without      
limitation, all interest and charges, prepayment charges, late charges and      
loan fees at any time accruing or assessed on any of the Secured      
Obligations.

2.3  Incorporation. All terms of the Secured Obligations are incorporated   
herein by this reference. All persons who may have or acquire an interest      
in the Subject Property shall be deemed to have notice of the terms of the      
Secured Obligations and to have notice, if provided therein, that: (a) the      
Note or the Loan Agreement may permit borrowing, repayment and      
re-borrowing so that repayments shall not reduce the amounts of the      
Secured Obligations; and (b) the rate of interest on one or more Secured 
Obligations may vary from time to time.

                ARTICLE 3. ASSIGNMENT OF LEASES AND RENTS

3.1  Assignment. Trustor hereby irrevocably assigns to Beneficiary all of
Trustor's right, title and interest in, to and under: (a) all leases of the 
Subject Property, all licenses and agreements relating to the management, 
leasing or operation of the Subject Property and all other agreements of any 
kind relating to the use or occupancy of the Subject Property, whether now
existing or entered into after the date hereof ("Leases"); and (b) the rents,
issues and profits of the Subject Property, including, without limitation, all
mounts payable and all rights and benefits accruing to Trustor under the
Leases ("Payments"). The term Leases" shall also include all guarantees of
and security for the lessees' performance thereunder, and all amendments,
extensions, renewals or modifications thereto which are permitted hereunder.
This is a resent and absolute assignment, not an assignment for security 
purposes only, and Beneficiary's right to he Leases and Payments is not
contingent upon, and may be exercised without possession of, the Subject
property.

3.2  Grant of License. Beneficiary confers upon Trustor a license
("License") to collect and retain the Payments as they become due and
payable, until the occurrence of a Default (as hereinafter defined). Upon a
Default, the License shall be automatically revoked and Beneficiary may
collect and apply the Payments pursuant to Section 6.4 without notice and
without taking possession of the Subject Property. Trustor hereby irrevocably
authorizes and directs the lessees under the Leases to rely upon and comply
with any notice or demand by Beneficiary for the payment to Beneficiary of
any rental or other sums which may at any time become due under the
Leases, or for the performance of any of the lessees' undertakings under the
Leases, and the lessees shall have no right or duty to inquire as to 
whether any Default has actually occurred or is then existing hereunder.
Trustor hereby relieves the lessees from any liability to Trustor by reason of
relying upon and complying with any such notice or demand by Beneficiary.

3.3  Effect of Assignment. The foregoing irrevocable Assignment shall
not cause Beneficiary to be: (a) a mortgagee in possession; (b) responsible or
liable for the control, care, management or repair of the Subject Property or
for performing any of the terms, agreements, undertakings, obligations, 
representations, warranties, covenants and conditions of the Leases; or (c)
responsible or liable for any waste committed on the Subject Property by the
lessees or any other parties; for any dangerous or defective condition of the
Subject Property; or for any negligence in the management, upkeep, 
repair or control of the Subject Property resulting in loss or injury or death 
to any Lessee, licensee, employee, invitee or other person. Beneficiary shall 
not directly or indirectly be liable to Trustor or any other person as a 
consequence of: (i) the exercise or failure to exercise any of the rights, 
remedies or powers granted to Beneficiary hereunder; (ii)
the failure or refusal of Beneficiary to perform or discharge any obligation,
duty or liability of Trustor arising under the Leases.

<PAGE>
3.4  Representations and Warranties. Trustor represents and warrants  
that: (a) all existing Leases are in full force and effect and are enforceable 
in accordance with their respective terms, and no breach or default, or event
which would constitute a breach or default after notice or the passage of 
time, or both, exists under any existing Leases; and (b) no rent or other
payment under any existing Lease has been paid by any lessee for more than
one (1) month in advance; and (c) none of the lessor's interests under any of
the Leases has been transferred or assigned.

3.5  Covenants. Trustor covenants and agrees at Trustor's sole cost and
expense to: (a) perform the obligations of lessor contained in the Leases and
enforce by all available remedies performance by the lessees of the
obligations of the lessees contained in the Leases; (b) give Beneficiary
prompt written notice of any default which occurs with respect to any of the
Leases, whether the default be that of the lessee or of the lessor; (c) 
deliver to Beneficiary fully executed, counterpart original(s) of each and 
every Lease if requested to do so; and (d) execute and record such additional 
assignments of any Lease or specific subordinations of any Lease to the Deed 
of Trust, in form and substance acceptable to Beneficiary, as Beneficiary may 
request. Except with Beneficiary's prior written consent, or as otherwise 
permitted by any provision of the Loan Agreement, Trustor shall not: (i) 
enter into any Leases after the date of this Assignment; (ii) execute any 
other assignment relating to any of the Leases; (iii) discount any rent or 
other sums due under the Leases or collect the same in advance, other than to 
collect rent one (1) month in advance of the time when it becomes due; (iv) 
terminate, modify or amend any of the terms of the Leases or in any manner 
release or discharge the lessees from any obligations thereunder; (v) consent 
to any assignment or subletting by any lessee; or (iv) subordinate or agree 
to subordinate any of the Leases to any other deed of trust or encumbrance. 
Any such attempted action in violation of the provisions of this Subsection
shall be null and void.

3.6  Estoppel Certificates. Within thirty (30) days after request by
Beneficiary, Trustor shall deliver to Beneficiary and to any party designated
by Beneficiary estoppel certificates executed by Trustor and by each of the
lessees, in recordable form, certifying (if such be the case): (i) that the 
foregoing assignment and the Leases are in full force and effect; (ii) the date
of each lessee's most recent payment of rent; (iii) that there are no defenses 
or offsets outstanding, or stating those claimed by Trustor or lessees under the
foregoing assignment or the Leases, as the case may be; and (iv) any 
other information reasonably requested by Beneficiary.

              ARTICLE 4. SECURITY AGREEMENT AND FIXTURE FILING

4.1  Security Interest. Trustor hereby grants and assigns to Beneficiary
as of the "Effective Date" (defined in the Loan Agreement) a security
interest, to secure payment and performance of all of the Secured
Obligations, in all of the Subject Property which is or may be held to be
personal property and in which Trustor now or at any time hereafter has any
interest ("Collateral"). As to all of the Subject Property which is or which
hereafter becomes a "fixture" under applicable law, this Deed of 
Trust is to be recorded in the real property records and filed as a fixture 
filing under Sections 9313 and 9402(6) of the California Uniform Commercial
Code, as amended or recodified from time to time, and is acknowledged and
agreed to be a "construction mortgage" under such Sections.

4.2  Representations and Warranties. Trustor represents and warrants
that: (a) Trustor has, or will have, good title to the Collateral; (b) 
Trustor has not previously assigned or encumbered the Collateral, and no 
financing statement covering any of the Collateral has been delivered to any 
other person or entity; and (c) Trustor's principal place of business is 
located at the address specified herein.

4.3  Rights of Beneficiary. In addition to Beneficiary's rights as a
"Secured Party" under the California Uniform Commercial Code, as amended
or recodified from time to time ("UCC"), Beneficiary may, but shall not be
obligated to, at any time without notice and at the expense of Trustor: (a)
give notice to any person of Beneficiary's rights hereunder and enforce such
rights at law or in equity; (b) insure, protect, defend and preserve the
Collateral or any rights or interests of Beneficiary therein; (c) inspect the
Collateral; and (d) endorse, collect and receive any right to payment of
money owing to Trustor under or from the Collateral. Notwithstanding the
above, in no event shall Beneficiary be deemed to have accepted any property 
other than cash in satisfaction of any obligation of Trustor unless
Beneficiary shall make an express written election of said remedy underC
9505, or other applicable law.

4.4  Rights of Beneficiary on Default. Upon the occurrence of a Default
under this Deed of Trust, then in addition to all of Beneficiary's rights as a
"Secured Party" under the UCC or otherwise by law or under this Deed of
Trust:

(a)  Beneficiary may (i) upon written notice, require Trustor to assemble any
or all of the Collateral and make it available to Beneficiary at a place 
designated by Beneficiary; (ii) without prior notice, enter upon the Real 
Property, the Improvements or any other place where any of the Collateral may 
be located and take possession of, collect, sell, and dispose of any or all of 
the Collateral, and store the  same at locations acceptable to Beneficiary at 
Trustor's expense; (iii) sell, assign and deliver at any place or in any 
lawful manner all or any part of the Collateral and bid and become purchaser 
at any such sales; and

(b)  Beneficiary may, for the account of Trustor and at Trustor's expense: (i)
operate, use, consume, sell or dispose of the Collateral as Beneficiary deems
appropriate for the purpose of performing any or all of the Secured
Obligations; (ii) enter into any agreement, compromise, or settlement,
including insurance claims, which Beneficiary may deem desirable or proper
with respect to any of the Collateral; and (iii) endorse and deliver evidences
of title for, and receive, enforce and collect by legal action or
otherwise, all indebtedness and obligations now or hereafter owing to Trustor
in connection with or n account of any or all of the Collateral.

Notwithstanding any other provision hereof, Beneficiary shall not be deemed
to have accepted any property other than cash in satisfaction of any
obligation of Trustor to Beneficiary unless Trustor shall make an express
written election of said remedy under  9505, or other applicable law.

4.5  Power of Attorney. Upon ten (10) business days notice of the
necessity of a power of attorney, Trustor will appoint Beneficiary as Trustor's
attorney-in-fact (such agency being coupled with an interest), and as
such attorney-in-fact Beneficiary may, without the obligation to do so, in
Beneficiary's name, or in the name of Trustor, prepare, execute and file or
record financing statements, continuation statements, applications for
registration and like papers necessary to create, perfect or preserve any of 
Beneficiary's security interests and rights in or to any of the Collateral, and,
upon a Default hereunder, take any other action required of Trustor;
provided, however, that Beneficiary as such attorney-in-fact shall be
accountable only for such funds as are actually received by Beneficiary.

4.6  Possession and Use of Collateral. Except as otherwise provided in
this Section or the other Loan Documents, so long as no Default exists under
this Deed of Trust or any of the Loan Documents, Trustor may possess, use,
move, transfer or dispose of any of the Collateral in the ordinary course of 
Trustor's business and in accordance with the Loan Agreement.

                ARTICLE 5. RIGHTS AND DUTIES OF THE PARTIES

5.1  Title. Trustor warrants that Trustor lawfully holds and possesses fee
simple title to the Subject Property without limitation on the right to
encumber, and that this Deed of Trust is a first and prior lien 
on the Subject Property.

5.2  Taxes and Assessments. Subject to Trustor's rights to contest
payment of taxes as may be provided in the Loan Agreement, Trustor shall
pay prior to delinquency all taxes, assessments, levies and charges
imposed by any public or quasi-public authority or utility company which are
or which may become a lien upon or cause a loss in value of the Subject
Property or any interest therein. Trustor shall also pay prior
to delinquency all taxes, assessments, levies and charges imposed by any
public authority upon Beneficiary by reason of its interest in any Secured
Obligation or in the Subject Property, or by reason of any payment
made to Beneficiary pursuant to any Secured Obligation; provided however
Trustor shall have no obligation to pay taxes which may be imposed from
time to time upon Beneficiary and which are measured by and imposed upon
Beneficiary's net income.

5.3  Tax and Insurance Impounds. If Trustor should fail to pay when
due, then at Beneficiary's option and upon its demand, Trustor, shall, until all
Secured Obligations have been paid in full, pay to Beneficiary monthly,
annually or as otherwise directed by Beneficiary an amount estimated by
Beneficiary to be equal to: (i) all taxes, assessments and levies imposed by
any public or quasi-public authority or utility company which are
or may become a lien upon the Subject Property and will become due for the
tax year during which such payment is so directed; and 60 premiums for any
and all insurance required by the Loan Agreement next due. If Beneficiary
determines that any amounts paid by Trustor are insufficient for 
the payment in full of such taxes, assessments, levies and/or insurance
premiums, Beneficiary shall notify Trustor of the increased
amounts required to pay all amounts due, whereupon Trustor shall pay to
Beneficiary within thirty (30) days thereafter the additional amount as stated
in Beneficiary's notice. All sums so paid shall not bear interest, except to the
extent and in any minimum amount required by law; and Beneficiary 
shall, unless Trustor is otherwise in Default hereunder or under any Secured
Obligation, apply said funds to the payment of, or at the sole option of
Beneficiary release said funds to Trustor for the application to and 
payment of, such sums, taxes, assessments, levies, charges, and insurance
premiums. Upon Default by Trustor hereunder or under any Secured
Obligation; Beneficiary may apply all or any part of said sums to any
Secured Obligation and/or to cure such Default, in which event Trustor shall
be required to restore all amounts so applied, as well as to cure any other
events or conditions of Default not cured by such application. Upon
assignment of this Deed of Trust, Beneficiary shall have the right to assign 
all amounts collected and in its possession to its assignee whereupon
Beneficiary and its Trustee shall be released from all liability with respect
thereto. Within ninety-five (95) days following full repayment of the 
Secured Obligations (other than full repayment of the Secured Obligations as
a consequence of a foreclosure or conveyance in lieu of foreclosure of the
liens and security interests securing the Secured Obligations) or
at such earlier time as Beneficiary may elect, the balance of all amounts
collected and in Beneficiary's possession shall be paid to Trustor and no other
party shall have any right or claim thereto.

5.4  Performance of Secured Obligations. Trustor shall promptly pay
and perform each Secured Obligation when due.

5.5  Liens, Encumbrances and Charges. Trustor shall immediately
discharge any lien not approved by Beneficiary in writing that has or may
attain priority over this Deed of Trust. Subject to the provisions of
the Loan Agreement regarding mechanics' liens, Trustor shall pay when due
all obligations secured by or reducible to liens and encumbrances which shall
now or hereafter encumber all or any part of the Subject Property or any
interest therein, whether senior or subordinate hereto.

5.6  Damages; Insurance and Condemnation Proceeds.

(a)  The following (whether now existing or hereafter arising) are all 
absolutely and irrevocably assigned by Trustor to Beneficiary and, at the 
request of Beneficiary, shall be paid directly to Beneficiary: (i) all awards 
of damages and all other compensation payable directly or indirectly by 
reason of a condemnation or proposed condemnation for public or private use 
affecting all or any part of, or any interest in, the Subject Property; (ii) 
all other claims and awards for damages to, or decrease in value of, all or 
any part of, or any interest in, the Subject Property; (iii) all proceeds of 
any insurance policies payable by reason of loss sustained to all or any part 
of the Subject Property; and (iv) all interest which may accrue on any of the 
foregoing. Subject to applicable law, and without regard to any requirement 
contained in Section 5.7(d), Beneficiary may at its discretion apply all or 
any of the proceeds it receives to its expenses in settling, prosecuting or 
defending any claim and may apply the balance to the Secured Obligations in 
any order, and/or Beneficiary may release all or any part of the proceeds to 
Trustor upon any conditions Beneficiary may impose. Beneficiary may commence, 
appear in, defend or prosecute any assigned claim or action and may adjust,
compromise, settle and collect all claims and awards assigned to
Beneficiary; provided, however, in no event shall Beneficiary be responsible
for any failure to collect any claim or award, regardless of the cause of the
failure.

(b)  Beneficiary shall permit insurance or condemnation proceeds held by
Beneficiary to be used for repair or restoration provided all of the following
have been satisfied: M the deposit with Beneficiary of such additional funds
which Beneficiary determines are needed to pay all cost of the repair or
restoration (including, without limitation, taxes, financing charges, insurance
and rent during the repair period);
(ii) establishment of an arrangement for lien releases and disbursement of funds
acceptable to Beneficiary; (iii) the delivery to Beneficiary of plans and
specifications for the work, a contract for the work signed by a contractor
acceptable to Beneficiary, a cost breakdown for the work and a payment and
performance bond for the work, all of which shall be acceptable to Beneficiary;
(iv) such reasonable conditions as Beneficiary may impose; and (v) the delivery
to Beneficiary of evidence acceptable to Beneficiary (aa) that upon completion
of the work, the size, capacity and total value of the Subject Property will 
be at least as great as it was before the damage or condemnation occurred; 
(bb) that there has been no material adverse change in the financial condition 
or credit of Trustor since the date of this Deed of Trust; and (cc) of 
satisfaction of any additional conditions that Beneficiary may reasonably 
establish to protect its security. Trustor hereby acknowledges that the 
conditions described above are reasonable.

5.7  Maintenance and Preservation of the Subject Property. 
Subject to the provisions of the Loan Agreement, Trustor covenants: (a) to
insure the Subject Property against such risks as Beneficiary may 
require and to comply with the requirements of any insurance companies
insuring the Subject Property; (b) to keep the Subject Property in good
condition and repair; (c) except with Beneficiary's prior written consent, not
to remove or demolish the Subject Property or any part thereof, not to alter,
restore or add to the Subject Property (except as expressly provided for in the
Loan Agreement) and not to initiate or acquiesce in any change in any zoning
or other land classification which affects the Subject Property; (d) to 
complete or restore promptly and in good and workmanlike manner the
Subject Property, or any part thereof which may be damaged or destroyed,
without regard to whether Beneficiary elects to require that insurance
proceeds be used to reduce the Secured Obligations as provided in Section
5.6; (e) to comply with all laws, ordinances, regulations and standards, and
all covenants, conditions, restrictions and equitable servitude, whether public
or private, of every kind and character which affect the Subject Property and 
pertain to acts committed or conditions existing thereon, including, without
limitation, any work, alteration, improvement or demolition mandated by
such laws, covenants or requirements; (f) not to knowingly commit or permit
waste of the Subject Property; (g) to do all other acts which from the
character or use of the Subject Property may be reasonably necessary to
maintain and preserve its value; (h) not to knowingly make any
use of the Subject Property which would invalidate any insurance thereon
which Trustor is required to carry pursuant to the Loan Agreement; and (i)
not to construct any improvements on the Real Property, except those
described in the Loan Agreement.

5.8  Defense and Notice of Losses, Claims and Actions. At Trustor's sole
expense, Trustor shall protect, preserve and defend the Subject Property and
title to and right of possession of the Subject Property, the security hereof
and the rights and powers of Beneficiary and Trustee hereunder against all 
adverse claims. Trustor shall give Beneficiary and Trustee prompt notice in
writing of the assertion of any claim, of the filing of any action or
proceeding, of the occurrence of any damage to the Subject Property 
and of any condemnation offer or action actually made or filed, and of any
Default hereunder, or any event which will become a Default hereunder after
notice and/or expiration of any cure period.

5.9  Acceptance of Trust; Powers and Duties of -Trustee. Trustee
accepts this trust when this Deed of Trust is recorded. From time to time
upon written request of Beneficiary and without affecting the personal
liability of any person for payment of any indebtedness or performance of
any obligations  secured hereby, Trustee may, without liability therefor and
without notice: (i) reconvey all or any part of the Subject Property; (ii)
consent to the making of any map or plat thereof; and (iii) join in any grant 
of easement hereon, any declaration of covenants and restrictions, or any
extension agreement or any agreement subordinating the lien or charge of
this Deed of Trust. Except as may be required by applicable law,
Trustee or Beneficiary may from time to time apply to any court of
competent jurisdiction for aid and direction in the execution of the trust
hereunder and the enforcement of the rights and remedies available
hereunder, and may obtain orders or decrees directing or confirming or
approving acts in the execution of said trust and the enforcement of said
remedies. Trustee has no obligation to notify any party of any
pending sale or any action or proceeding, including, without limitation,
actions in which Trustor, Beneficiary or Trustee shall be a party unless held
or commenced and maintained by Trustee under this Deed of Trust.
Trustee shall not be obligated to perform any act required of it hereunder
unless the performance of the act is requested in writing and Trustee is
reasonably indemnified and held harmless against loss, cost, liability or
expense.

5.10 Compensation: Exculpation; Indemnification.

(a)  Trustor shall pay upon demand Trustee's fees and reimburse Trustee for
necessary expenses in the administration of this trust, including reasonable
attorneys' fees, together with interest at the "Default Rate" (as defined in the
Note) from the date funds were spent. Trustor shall pay to Beneficiary
reasonable compensation for services rendered concerning this Deed of
Trust, including without limit any statement of amounts owing under any
Secured Obligation. Beneficiary shall not directly or indirectly be liable to
Trustor or any other person as a consequence of (i) the exercise of the rights,
remedies or powers granted to Beneficiary in this Deed of Trust; (ii) the
failure or refusal of Beneficiary to perform or discharge any obligation or
liability of Trustor under any agreement related to the Subject Property or
under this Deed of Trust; or (iii) any loss sustained by Trustor or any third
party resulting from Beneficiary's failure to lease the Subject Property after
a default or from any other act or omission of Beneficiary in managing the
Subject Property after a Default unless the loss is caused by the gross
negligence or willful misconduct of Beneficiary and no such liability shall
be asserted against or imposed upon Beneficiary, and all such liability is
hereby expressly waived and released by Trustor.

(b)  Trustor indemnifies Trustee, Beneficiary and their respective directors,
officers, agents, successors and assigns (including without limitation any
participants in the loan secured hereby) against, and holds Trustee,
Beneficiary and their respective directors, officers, agents, successors and
assigns (including without limitation any participants in the loan secured
hereby) harmless from, all losses, damages, liabilities, claims, causes of
action, judgments, fines, penalties, court costs, attorneys' fees and other 
legal expenses, cost of evidence of title, cost of evidence of value, and other
expenses which they may suffer or incur: (i) by reason of this Deed of Trust;
(ii) by reason of the execution of this trust or in performance of any act
required or permitted hereunder or by law; (iii) as a result of any failure of
Trustor to perform Trustor's obligations; (iv) by reason of any alleged
obligation or undertaking on Beneficiary's part to perform or discharge any
of the representations, warranties, conditions, covenants or other obligations
contained herein or in any other document related to the Subject Property;
(v) as a result of the construction of or any failure to construct the
Improvements; (vi) as the result of any negligence or intentional wrongful
act or omission of Trustor; or (vii) as the result of any death, personal injury
or bodily injury occurring on or about the Real Property. The above
obligation of Trustor to indemnify and hold harmless shall survive the
release and cancellation of the Secured Obligations and the release and
reconveyance or partial release and reconveyance of this Deed of Trust.

(c)  Trustor shall pay all amounts and indebtedness arising under this Section
5.10 immediately upon demand by Trustee or Beneficiary together with
interest thereon from the date the indebtedness arises at the rate of interest
applicable to the principal balance of the Note as specified therein.

5.11 Substitution of Trustees. From time to time, by a writing, signed and
acknowledged by Beneficiary and recorded in the Office of the Recorder
of the County in which the Subject Property is situated, Beneficiary may
appoint another trustee to act in the place and stead of Trustee or any
successor. Such writing shall set forth any information required by law-
The recordation of such instrument of substitution shall discharge
Trustee herein named and shall appoint the new trustee as the trustee
hereunder with the same effect as if originally named Trustee herein. A
writing recorded pursuant to the provisions of this Section 5.11 shall be
conclusive proof of the proper substitution of such new Trustee.

5.12 Transfer or Encumbrance of Property by Trustor. Trustor acknowledges
that: (a) the financial stability, development expertise and managerial
and marketing ability of Trustor were and are a substantial and material
consideration to Beneficiary and, in reliance thereon, Beneficiary has
agreed to make the loan to Trustor evidenced by the Loan Documents;
and (b) the transfer of possession of the Subject Property to anyone
other than an owner occupant of individual lots or units within the
subject property, or a change in the person or entity constructing and
developing the Subject Property may significantly and materially alter
or reduce Beneficiary's security for the Note. Accordingly, as a material
inducement to Beneficiary to enter into the transactions contemplated
by the Loan Documents, Trustor shall not transfer the Subject Property
or any portion thereof or interest therein, other than the sale and transfer
of Units to purchasers in the ordinary course of Trustor's business,
without the prior written consent of Beneficiary, except as may be
specifically permitted elsewhere herein. Beneficiary may grant or deny
such consent in its sole discretion and, if consent should be given, any
such transfer shall be subject to this Deed of Trust, and any 
transferee shall assume all of Trustor's obligations hereunder and, agree
to be bound by all provisions and perform all obligations contained
herein. In the event of any such transfer without the written consent of
Beneficiary, Beneficiary may, at its option, without demand or notice,
declare all sums secured hereby immediately due and payable. Consent
to one such transfer shall not be deemed to be a waiver of the right to
require consent to future or successive transfers. As used herein,
"transfer" shall mean M the sale, agreement to sell, transfer or
conveyance of the Subject Property, or any portion thereof or interest
therein, including, without limitation, air rights and development rights,
whether voluntary, involuntary, by operation of law or otherwise, or the
lease of all or substantially all of the Subject Property, reasonably
necessary for the development of the Subject Property in compliance with the 
Loan Agreement, the repair or replacement of any Collateral in the ordinary
course of business or the sale and transfer of Units to purchasers in the
ordinary course of Trustor's business; (ii) any transfer by way of
security, including the placing or permitting the placing on the Subject
Property of any mortgage, deed of trust, assignment of rents or other
security device; and (iii) if Trustor, or any person owning directly or
indirectly through one or more entities any interest in Trustor
individually and collectively a "Principal"), is a partnership, joint
venture, trust, closely-held corporation or other entity, the issuance, sale,
conveyance, transfer, disposition or encumbering of more than
twenty-five percent (25%) of any class of the currently issued and
outstanding stock or other beneficial interest of Trustor, or any Principal
or a change of any general partner or any joint venturer of Trustor or any
Principal, either voluntarily, involuntarily, or otherwise. For purposes of
this section, "closely-held corporation" shall mean any corporation not
listed on a national or regional stock exchange.

5.13 Releases, Extensions. Modifications and Additional Security. Without
notice to or the consent, approval or agreement of any persons or entities
having any interest at any time in the Subject Property or in any manner
obligated under the Secured Obligations ("Interested Parties"),
Beneficiary may, from time to time, release any person or entity from
liability for the payment or performance of any Secured Obligation, take
any action or make any agreement extending the maturity or otherwise 
altering the terms or increasing the amount of any Secured Obligation,
or accept additional security or release all or a portion of the Subject
Property and other security for the Secured Obligations. None of the
foregoing actions shall release or reduce the personal liability of any of
said Interested Parties, or release or impair the priority of the lien of this
Deed of Trust upon the Subject Property.

5.14 Reconveyance. Upon Beneficiary's written request, Trustee shall
reconvey, without warranty, the Subject Property or that portion thereof
then held hereunder. To the extent permitted by law, the reconveyance
may describe the grantee as "the person or persons legally entitled
thereto" and the recitals of any matters or facts in any reconveyance
executed hereunder shall be conclusive proof of the truthfulness thereof.
Neither Beneficiary nor Trustee shall have any duty to determine the
rights of persons claiming to be rightful grantees of any reconveyance.
When the Subject Property has been fully reconveyed, the last such
reconveyance shall operate as a reassignment of all future rents, issues
and profits of the Subject Property to the person or persons legally
entitled thereto.

5.15 Subrogation. Beneficiary shall be subrogated to the lien of all
encumbrances, whether released of record or not, paid in whole or in
part by Beneficiary pursuant to this Deed of Trust or by the proceeds of
any loan secured by this Deed of Trust.

5.16 Right of Inspection. Beneficiary, its agents and employees, may enter
the Subject Property at any reasonable time for the purpose of inspecting
the Subject Property and ascertaining Trustor's compliance with the
terms hereof.

                      ARTICLE 6. DEFAULT PROVISIONS

6.1  Default. For all purposes hereof, the term "Default" shall mean (a) the
failure of Trustor to perform any material obligation hereunder, or the failure 
to be true of any material representation or warranty of Trustor contained 
herein and the continuance of such failure for ten (10) business days after 
notice, or within any longer grace period, if any, allowed in the Loan 
Agreement for such failure, or (b) the existence of any Default or Event of 
Default as defined in the Note, Loan Agreement or any other Loan Document.

6.2  Rights and Remedies. At any time after Default, Beneficiary and
trustee shall each have all the following rights and remedies:

(a)  With ten (10) business days notice, to declare all Secured Obligations
immediately due and payable;

(b)  With ten (10) business days notice, and without releasing Trustor
from any Secured Obligation, and without becoming a mortgagee in possession, 
to cure any breach or default of Trustor and, in connection therewith, to 
enter upon the Subject Property and do such acts and things as Beneficiary 
or Trustee deems necessary or desirable to protect the security hereof,
including, without limitation: (i) to appear in and defend any action or 
proceeding purporting to affect the security of this Deed of Trust or the 
rights or powers of Beneficiary or Trustee under this Deed of Trust; (ii) to 
pay, purchase, contest or compromise any encumbrance, charge, lien or claim 
of lien which, in the sole judgment of either Beneficiary or Trustee, is or 
may be senior in priority to this Deed of Trust, the judgment of Beneficiary 
or Trustee being conclusive as between the parties hereto; (iii) to
obtain insurance; (iv) to pay any premiums or charges with respect to 
insurance required to be carried under this Deed of Trust;  or (v) to employ 
counsel, accountants, contractors and other appropriate persons;

(c)  To commence and maintain an action or actions in any court of
competent jurisdiction to foreclose this instrument as a mortgage or to 
obtain specific enforcement of the covenants of Trustor hereunder, and 
Trustor agrees that such covenants shall be specifically enforceable by
injunction or any other appropriate equitable remedy and that for the 
purposes of any suit brought under this subparagraph, Trustor waives the 
defense of laches and any applicable statute of limitations;

(d)   To apply to a court of competent jurisdiction for and obtain
appointment of a receiver of the Subject Property as a matter of strict right 
and without regard to the adequacy of the security for the repayment of the 
Secured Obligations, the existence of a declaration that the
Secured Obligations are immediately due and payable, or the filing of a 
notice of default, and Trustor hereby consents to such appointment;

(e)  To enter upon, possess, manage and operate the Subject Property or any
part thereof, to collect all rents, income and profits therefrom, to take and
possess all documents, books, records, papers and accounts of Trustor or the
then owner of the Subject Property, to make, terminate, enforce or 
modify leases of the Subject Property upon such terms and conditions as
Beneficiary deems proper, and to make repairs, alterations and improvements
to the Subject Property as necessary, in Trustee's or Beneficiary's sole
judgment, to protect or enhance the security hereof; 

(f)  To execute a written notice of such Default and of its election to cause
the Subject Property to be sold to satisfy the Secured Obligations. As a
condition precedent to any such sale, Trustee shall give and record such
notice as the law then requires. When the minimum period of time required
by law after such notice has elapsed, Trustee, without notice to or demand
upon Trustor except as required by law, shall sell the Subject Property at the
time and place of sale fixed by it in the notice of sale, at one or
several sales, either as a whole or in separate parcels and in such manner and
order, all as Beneficiary in its sole discretion may determine, at public
auction to the highest bidder for cash, in lawful money of the United States,
payable at time of sale. Neither Trustor nor any other person or entity other 
than Beneficiary shall have the right to direct the order in which the Subject
Property is sold. Subject to requirements and limits imposed by law, Trustee
may from time to time postpone sale of all or any portion of the Subject
Property by public announcement at such time and place of sale. Trustee 
shall deliver to the purchaser at such sale a deed conveying the Subject
Property or portion thereof so sold, but without any covenant or warranty,
express or implied. The recitals in the deed of any matters or facts shall be
conclusive proof of the truthfulness thereof. Any person, including Trustee,
Trustor or Beneficiary may purchase at the sale; and

(g)  To resort to and realize upon the security hereunder and any other  
security now or later held by Beneficiary concurrently or successively and in
one or several consolidated or independent judicial actions or lawfully taken
non-judicial proceedings, or both, and to apply the proceeds received 
upon the Secured Obligations all in such order and manner as Trustee and
Beneficiary, or either of them, determine in their sole discretion;

(h)  To suspend or terminate, at its option, its obligation to make further
disbursements under the Loan Agreement; and

(i)  To exercise any other rights or remedies available to Beneficiary at law,
in equity, by statute or otherwise.

If Beneficiary spends its funds in exercising any of its rights or remedies
hereunder, the amount of funds spent shall be payable to Beneficiary upon
demand, together with interest at the Default Rate from the date the funds were
spent. At any sale of the Subject Property held pursuant to Section 6.02(c) 
or Section 6.02(f) above, Beneficiary may bid, as the equivalent of cash, the 
amount of all or any of the Secured Obligations, including, without limitation, 
attorneys' fees.

6.3  Application of Foreclosure Sale Proceeds. After deducting all costs,
fees and expenses of Trustee, and of this trust, including, without limitation,
cost of evidence of title and attorneys' fees in connection with sale,
Trustee shall apply all proceeds of any foreclosure sale: (i) to payment of all
sums expended by Beneficiary under the terms hereof and not then repaid,
with accrued interest at the rate of interest specified in the Note to be
applicable on or after maturity or acceleration of the Note, and to payment of
all other Secured Obligations, in any order Beneficiary may elect; and (ii) the
remainder, if any, to the, person or persons legally entitled thereto.

6.4  Application of Other Sums. All sums received by Beneficiary under
Section 3.2 or Section 6.2, less all reasonable costs and expenses incurred by
Beneficiary or any receiver under Section 3.2 or Section 6.2,
including, without limitation, reasonable attorneys' feds, shall be applied in
payment of the Secured Obligations in such order as Beneficiary shall
determine in its sole discretion; provided, however, Beneficiary shall
have no liability for funds not actually received by Beneficiary.

6.5  No Cure or Waiver. Neither Beneficiary's nor Trustee's nor any
receiver's entry upon and taking possession of all or any part of the Subject
Property, nor any collection of rents, issues, profits, insurance proceeds,
condemnation proceeds or damages, other security or proceeds of other
security, or other sums, nor the application of any collected sum to any
Secured Obligation, nor the exercise or failure to exercise of any
other right or remedy by Beneficiary or Trustee or any receiver shall cure or
waive any breach, Default or notice of default under this Deed of Trust, or
nullify the effect of any notice of default or sale (unless all Secured
Obligations then due have been paid and performed and Trustor has cured all
other defaults), or impair the status of the security, or prejudice Beneficiary
or Trustee in the exercise of any right or remedy, or be construed as an
affirmation by Beneficiary of any tenancy, lease or option or a subordination
of the lien of this Deed of Trust.

6.6  Payment of Costs. Expenses and Attorney's Fees. Trustor agrees to
pay to Beneficiary immediately and without demand all reasonable costs and
expenses incurred by Trustee and Beneficiary pursuant to subparagraphs (a)
through (g) inclusive of Section 6.2 (including, without limitation, court 
costs and reasonable attorneys' fees, whether incurred in litigation or not)
with interest at the Default Rate from the date of expenditure until said sums
have been paid at the rate of interest applicable to the principal balance
of the Note as specified therein. In addition, Trustor shall pay to Trustee all
Trustee's fees hereunder and shall reimburse Trustee for all expenses incurred
in the administration of this trust, including, without limitation, any 
attorneys' fees.

6.7  Power to File Notices and Cure Defaults. Trustor hereby Irrevocably 
appoints Beneficiary and its successors and assigns, as its attorney-in-fact, 
which agency is coupled with an interest, (a) to execute and/or record
any notices of completion, cessation of labor, or any other notices that
Beneficiary deems appropriate to protect Beneficiary's interest, (b) upon the
issuance of a deed pursuant to the foreclosure of this Deed of Trust or the
delivery of a deed in lieu of foreclosure, to execute all instruments of
assignment or further assurance with respect to the Leases and Payments in
favor of the grantee of any such deed, as may be necessary or desirable for
such purpose, (c) to prepare, execute and file or record financing statements,
continuation statements, applications for registration and like papers  
necessary to create, perfect or preserve Beneficiary' security interests and 
rights in or to any  of the Collateral, and (d) upon the occurrence of an 
event, act or omission which, with notice or passage of time or both, would 
constitute a Default, Beneficiary may perform any obligation of Trustor 
hereunder; provided, however that: (i) Beneficiary as such attorney-in-fact 
shall only be accountable for such funds as are actually received
by Beneficiary; and (ii) Beneficiary shall not be liable to Trustor or any other
person or entity for any failure to act under this Section.

6.8   Restoration of Position. In case Beneficiary shall have undertaken to
enforce any right under this Deed of Trust by foreclosure, sale, entry or
otherwise, and such undertaking shall have been discontinued or
abandoned for any reason or shall have been determined adversely to
Beneficiary, then and in every such case Trustor, Trustee and Beneficiary
shall be restored to their former positions and rights hereunder with
respect to the Subject Property, and all rights, remedies, powers and security
of Beneficiary and Trustee shall continue in full force and effect, as if no 
such proceedings had ever been initiated.

6.9   Evidence of Title. In the event of the occurrence of any Default under
this Deed of Trust, Beneficiary may procure evidence of title to the Subject
Property, including but not limited to an abstract of title or continuation
thereof or a title insurance policy or commitment therefor or extension 
thereof, covering the Real Property, and/or chattel lien searches covering any 
of the reminder of the Subject  Property, all at the sole cost and expense of 
Trustor, and, in case action is commenced to foreclose this Deed of Trust or to
sell the Subject Property, Trustor agrees that, in addition to the reasonable
attorneys' fees of Beneficiary (prior to trial, at trial and on appeal), it 
will pay any court costs which may be incurred in connection therewith. The
reasonable costs of any such abstract of title, continuation, title insurance 
policy, commitment or extension, and chattel lien searches, and all of such
court costs and reasonable attorneys' fees, together with interest thereon at 
the Default Rate (as that term is defined in the Note) from the date
incurred, shall be charged and added to the indebtedness secured hereby and
shall be payable on demand.

                      ARTICLE 7. MISCELLANEOUS PROVISIONS

7.1   Additional Provisions. The Loan Documents contain or incorporate by
reference the entire agreement of the parties with respect to matters
contemplated herein and supersede all prior negotiations. 
The Loan Documents grant further rights to Beneficiary and contain further
agreements and affirmative and negative covenants by Trustor which apply to
this Deed of Trust and to the Subject Property and such further rights
and agreements are incorporated herein by this reference.

7.2   Merger. No merger shall occur as a result of Beneficiary's acquiring
any other estate in, or any other lien on, the Subject Property unless
Beneficiary consents to a merger in writing.

7.3   Obligations of Trustor, Joint and Several. If more than one person has
executed this Deed of  Trust as "Trustor", the obligations of all such persons
hereunder shall be joint and several.

7.4   Recourse to Sel2arate Property. Any married person who executes this
Deed of Trust as a Trustor agrees that any money judgment which Beneficiary
or Trustee obtains pursuant to the terms of this Deed of Trust or any other
obligation of that married person secured by this Deed of Trust may be
collected  by execution upon that person's separate property, and any
community property of which that person is a manager.

7.5   Waiver of Marshalling Rights. Trustor, for itself and for all parties
claiming through or under Trustor, and for all parties who may acquire a lien
on or interest in the Subject Property, hereby waives all rights to have
the Subject Property and/or any other property which is now or later may be
security for any  Secured Obligation ("Other Property") marshalled upon any
foreclosure of this Deed of Trust or on a foreclosure of any other security for
any of the Secured Obligations. Ben ' eficiary shall have the right to sell, and
any court in which foreclosure proceedings may be brought shall have the
right to order a sale of, the Subject Property and any or all of the Other
Property as a whole or in separate parcels, in any order  that Beneficiary
may designate.

7.6   Rules of Construction. When the identity of the parties or other
circumstances make it appropriate the masculine gender includes the feminine
and/or neuter, and the singular number includes the plural. The term "Subject
Property means all and any part of the Subject property and any interest in 
the Subject Property.

7.7   Successors in Interest. The terms, covenants, and conditions herein
contained shall be binding upon and inure to the benefit of the heirs,
successors and assigns of the parties hereto; provided 
however that this Section does not waive the provisions of Section 5.12.

7.8   Incorporation. Exhibit A, is attached, and is hereby incorporated into
this Deed of Trust by this reference.

7.9   Addresses: Request for Notice. Notice to Beneficiary shall be sent to
Beneficiary addressed to: HOUSING CAPITAL COMPANY, a Minnesota
Partnership, 1825 South Grant Street, Suite 630, San Mateo, California 94402, 
Attn: Loan Administration, Loan #619R-08-09. Any Trustor whose address is set 
forth below hereby requests that a copy of notice of default and notice of 
sale be mailed to him at that address. Failure to insert an address shall 
constitute a designation of Trustor's last known address as the address for 
such notice. Correspondence to Trustee shall be addressed to: 501 West Weber 
Avenue, Suite 300, Stockton, California 95203.

IN WITNESS WHEREOF, Trustor has executed this Deed of Trust as of the
day and year set forth above.

        Address                               "Trustor(s) "

15225 Wicks Boulevard            TRACY RESIDENTIAL VENTURE PARTNERS,
San Leandro, CA 94577            LLC, a California limited liability company

                                 BY:   WESTCO COMMUNITY BUILDERS
                                       INC., a California corporation,
                                       Member
                                       By: /s/ Glen Britton Evans, Jr.
                                       Glen Britton Evans, Jr.
                                       Its:  Executive Vice President
                                       By: /s/ Jerry A Finch
                                       Jerry A Finch
                                       Its:  President
                                 BY:   DOVER INVESTMENTS CORP, a
                                       Delaware Corporation, Member
                                       INC., a California corporation,
                                       Member
                                       By: /s/ Lawrence Weissberg
                                       Lawrence Weissberg
                                       Its:  President


                              EXHIBIT A
                       (Description of Property)

Exhibit A to DEED OF TRUST executed by TRACY RESIDENTIAL VENTURE PARTNERS, 
LLC, a California limited liability company, as "Trustor" to CHICAGO TITLE 
COMPANY as "Trustee' for the benefit of HOUSING CAPITAL COMPANY, a Minnesota 
Partnership, as "Beneficiary", dated as of July 22, 1998.

                        Description of Property

That certain Real Property situated in the State of California, County of San
Joaquin, City of TRACY, described as follows:

LOTS 1 THROUGH 80 INCLUSIVE AS SHOWN UPON MAP ENTITLED TRACT NO. 2770 
GLENBRIAR ESTATES UNIT NO. 2 FILED FOR RECORD JANUARY 30,1998 IN BOOK 
OF MAPS AND PLATS, VOL. 33, PAGE 51, SAN JOAQUIN COUNTY RECORDS.




Housing Capital Company

                     BORROWING BASE REVOLVING LOAN AGREEMENT

                                                      Loan No. 619R-08-09

This Borrowing Base Revolving Loan Agreement (this "Agreement") is
made as of the 22nd day of July, 1998 by and between TRACY RESIDENTIAL
VENTURE PARTNERS, LLC, a California limited liability company
("Borrower"), and HOUSING CAPITAL COMPANY, a Minnesota Partnership
("Lender"), with respect to the following:

                               RECITALS

A.    Borrower owns or intends to acquire certain real property in the
Subdivision (as hereinafter defined) located in California upon which Borrower 
intends to construct detached single-family residential units,

B.    Pursuant to the terms and subject to the conditions contained herein,
Lender has agreed to make available 
to Borrower, and Borrower has agreed to obtain from Lender, a secured revolving
line of credit  facility for the purpose of financing the construction of 
detached single-family residential units on residential lots in the approved 
Subdivision.

NOW, THEREFORE, in consideration of the covenants and conditions herein
contained, the parties agree as follows:

                                ARTICLE I
                               DEFINITIONS

As used herein (including any Exhibits attached hereto), the following terms 
shall have the meanings set forth below (unless expressly stated to the 
contrary):

"Advance" shall mean each advance of the Loan by Lender to Borrower pursuant
to the terms of this Agreement.

"Agreement" shall mean this Borrowing Base Revolving Loan Agreement, as it
may be amended, modified, extended, renewed, restated or supplemented from
time to time.

"Appraised Value Lot" shall mean, with respect to each Lot which constitutes
Eligible Collateral, the retail value of such Lot, as approved or determined by
Lender in its sole and absolute discretion after review of the Subdivision
Appraisal. Such Appraised Value-Lot will reflect any adjustments for deductions
or discounts reflected in the Subdivision Appraisal (i.e. a reduction to 
reflect the Estimated Costs of Sale).

"Appraised Value Unit" shall mean, with respect to each Unit which constitutes
Eligible Collateral, the retail value of such Unit and its related Lot, as 
approved or determined by Lender in its sole and absolute discretion after 
review of the Subdivision Appraisal. Such Appraised Value-Unit will reflect 
any adjustments for deductions or discounts reflected in the Subdivision 
Appraisal (i.e. a reduction to reflect the Estimated Costs of Sale). Appraised 
Value-Unit shall not reflect any options or upgrades.

"Arbitration Agreement" shall mean an agreement between Borrower and
Lender in substantially the form attached hereto as Exhibit A and otherwise in
form and substance satisfactory to Lender.

"Available Commitment" shall mean, as of each Borrowing Base Determination
Date, and as reflected on a Borrowing Base Certificate approved by Lender, the
lesser of: (i) the aggregate of the Maximum Subdivision Commitment Amount;
(ii) the aggregate of the Total Available-Unit for all Units and their 
associated Lots that then constitute Eligible Collateral; or (iii) the 
Maximum Facility Commitment Amount.

"Borrower's Funds" should mean the funds to be deposited by Borrower in the
Borrower's Funds Account pursuant to Section5.4(b) hereof.

"Borrower's Funds Account" shall mean a non-interest bearing account
maintained with Lender for the purpose of receiving Borrower's Funds and
making Advances.

"Borrowing Base Certificate" shall mean a certificate, in form and substance
attached hereto as-Exhibit D, showing for each Unit that then constitutes 
Eligible Collateral, among other things, the following: (i) the Lot number as 
indicated on the recorded plat of the Subdivision; (ii) the Unit plan type; 
(iii) the Appraised Value-Unit; (iv) the Maximum Advance-Unit; (v) the Lot 
Advance; (vi) the Total Construction Draw-Unit and the Unit Budget. Such 
Borrowing Base Certificate shall be executed by the president, chief 
financial officer, or other executive officer of Borrower and shall also 
include (x) a certification that no Potential Default, or Event of Default 
exists hereunder or under any of the other Loan Documents and (y) a 
certification that Borrower is in compliance with all financial covenants set
forth in Section 7.16 as of the end of the most recently completed Fiscal 
Quarter, together with calculations substantiating such compliance.

"Borrowing Base Determination Date" shall mean the last day of each
calendar month.

"Business Day" shall mean a day other than Saturday, Sunday or a day on which
Lender is legally closed for business in the State of California.

"Collateral" shall mean, all that certain collateral described in the Deed of 
Trust together with all of Borrower's interest in all construction materials 
and equipment and all furniture, furnishings, fixtures, machinery, equipment,
inventory and all other items of personal property in which Borrower now or
hereafter owns or acquires any interest or right, and which are used or 
useful in the development, construction, marketing or sales of Units in the 
Subdivision (including, without limitation, the Stored Materials); all of 
Borrower's accounts receivable from sale of Units in the Subdivision; all of 
Borrower's documents, instruments, contract rights and general intangibles 
relating to the development, construction, marketing or sale of Units in the 
Subdivision; condemnation proceeds relating to any portion of the Subdivision; 
and all insurance proceeds from any policies of insurance covering any of 
the aforesaid.

"Commitment" shall mean the agreement by Lender in Section 2.1 to make
Advances pursuant to the terms and conditions set forth herein.

"Commitment Fee" shall mean the fee in the amount of $131,250.00 to be paid
by Borrower to Lender on or before the Effective Date.

"Construction Draw Available-Unit" shall mean, with respect to each Unit which
constitutes Eligible Collateral, the amount up to which Borrower may obtain
Advances hereunder with respect to the construction of such Unit, which amount
shall be equal to: (i) the Total Construction Draw-Unit for such Unit times 
ii) a percentage based on the Unit's completion stage of construction, 
determined on a cumulative basis in accordance with the stage of completion 
tables set forth on Exhibit C.

"Construction Schedule" shall mean, with respect to each Unit in the 
Subdivision, a construction schedule showing a trade-by-trade breakdown of 
the estimated periods of commencement and completion of construction of Units 
in the Subdivision in form and substance satisfactory to Lender.

"Conversion Date" shall mean the date which is twelve (12) calendar months
after the Effective Date.

"Conversion Fee" shall mean the fee in the amount of five eights of one percent
(0.625%) of the total Commitment remaining on the Conversion Date; to be paid
by Borrower to Lender on or before the Conversion Date.

"Conversion Period" shall mean the six (6) calendar month period immediately
following the Conversion Date.
"County' shall mean the county in which the Subdivision is located.

"Deed of Trust" shall mean, with respect to the Subdivision, a deed of trust,
fixture filing and assignment of rents, otherwise in form and substance
satisfactory to Lender, executed by Borrower as trustor and naming Lender as
beneficiary, creating a first lien on the Subdivision and all structures, 
fixtures and improvements now or hereafter owned or acquired by Borrower and 
situated thereon, and all rights and easements appurtenant thereto, in the 
amount of the Maximum Facility Commitment Amount.

"Default Rate" shall mean the rate of interest as set forth in the Note plus 
five percent (5%) per annum.

"Direct Costs" shall mean all costs incurred for labor performed in the
construction of the applicable Units and the materials incorporated into such
Units.

"Documentation Fee" shall mean the amount of $1,500.00 to be paid by
Borrower to Lender on or before the Effective Date.

"Draw Request Documents" shall mean the documents in the form to be
approved by Lender with which Borrower may request a disbursement of the
Loan.

"Effective Date" shall mean the date on which the conditions set forth in 
Section 3.1 are satisfied and the date the Deed of Trust is recorded in the 
Office of the County Recorder of the County.

"Eligible Collateral" shall mean Units, and the Lots upon which such Units are
located, which are a part of the Subdivision.

"Environmental Indemnity" shall mean, with respect to the Subdivision, an
unsecured indemnity from Borrower in favor of Lender covering environmental
matters in substantially the form and substance satisfactory to Lender.

"Environmental Laws" shall mean any and all present and future federal, state
and local laws, ordinances, regulations, policies and any other requirements of
Governmental Authorities relating to the health, safety, the environment or to 
any Hazardous Substances, including without limitation, the Comprehensive
Environmental Response, Compensation, and Liability Act (CERCLA), the
Resource Conservation Recovery Act (RCRA), the Hazardous Materials
Transportation Act, the Toxic Substance Control Act, the Endangered Species
Act, the Clean Water Act, the Occupational Safety and Health Act, the California
Environmental Quality Act and the applicable provisions of the California Health
and Safety Code, California Labor Code and the California Water Code, and the
rules, regulations and guidance documents promulgated thereunder.

"Event of Default" shall mean the occurrence of any of the events listed in
Section 9.1(a) and the expiration of any applicable notice and cure~period
provided in Section 9.1 (b).

"Governmental Authority" shall mean each federal, state or local body or
agency which has jurisdiction over the Property or the use, occupancy or
operation thereof, or the power to regulate, govern, approve or control the
Property or any aspect thereof.

"Guarantors" shall mean those persons or entities executing guarantees
pursuant to Section 3.1 (c).

"Hazardous Substance" shall mean (i) any chemical, compound, material,
mixture or substance that is now or hereafter defined or listed in, or otherwise
classified pursuant to, any Environmental Laws as a "hazardous substance",
"hazardous material", "hazardous waste", . extremely hazardous waste", "acutely
hazardous waste", "radioactive waste", "infectious waste", "biohazardous waste",
"toxic substance", "pollutant", "toxic pollutant", "contaminant" as well as any
formulation not mentioned herein intended to define, list, or classify 
substances by reason of deleterious properties such as ignitability, 
corrosivity, reactivity, carcinogenicity, toxicity, reproductive toxicity, 
"EP toxicity", or TCLP toxicity"; (ii) petroleum, natural gas, natural gas 
liquids, liquefied natural gas, synthetic gas usable for fuel (or mixtures of 
natural gas and such synthetic gas) and ash produced by a resource recovery 
facility utilizing a municipal solid waste stream, and defining fluids, 
produced waters and other sites associated with the exploration, development 
or production of crude oil, natural gas, or geothermal resources; 
(iii) "hazardous substance" as defined in Section 25281 M
of the California Health and Safety Code; (iv) "waste" as defined in section
13050(d) of the~ California Water Code; (v) asbestos in any form- (vi) urea
formaldehyde foam insulation; (vii) polychlorinated biphenyls (PCBs); (viii)
radon; and (ix) any other chemical, material, or substance that, because of its
quantity, concentration, or physical or chemical characteristics, exposure to
which is limited or regulated for health and safety reasons by any Governmental
Authority, or which poses a significant present or potential hazard to human
health and safety or to the environment if released into the workplace or the
environment.

"Indirect Costs" shall mean all costs incurred for ancillary services performed
in connection with the construction of the applicable Units, such as appraisal,
marketing, engineering, environmental consulting, architectural, survey, legal,
permit, franchise and license fees, title insurance premiums and the like and
interest.

"Inventory Unit" shall mean a Unit that does not qualify as a Presold Unit.

"Lender" shall mean HOUSING CAPITAL COMPANY, a Minnesota
Partnership ("Lender"), its successors and assigns and any party to which the
Note is assigned or otherwise transferred.

"Loan" shall mean the revolving line of credit described in this Agreement in
a principal amount outstanding at any time not to exceed the Available
Commitment.

"Loan Documents" shall mean this Agreement, the Note, the Deed of Trust,
any and all Security Agreements, any and all fixture filings, any and all
Environmental Indemnities, the Arbitration 
Agreement attached hereto, Repayment and Completion Guaranties, and any
and all other documents now or hereafter executed in connection with the
Loan.

"Lot" shall mean an individual Lot designated on the final subdivision plat, map
or filing for the Subdivision.

"Lot Advance" shall mean that portion of the Loan that is allocated for
disbursement of Land Costs as identified on Exhibit C-1 herein, to be paid to
Lender for repayment of loan No. 619.

"Maturity Date" shall mean the date which is twelve (12) calendar months after
the Effective Date, unless extended on the Conversion Date pursuant to Section
2.9, but in no event later than eighteen (18) calendar months after the 
Effective Date.

"Maturity Date Unit" shall mean the date which is twelve (12) months after the
date of the initial advance under the Unit Budget for each individual Unit which
is Eligible Collateral.

"Maximum Advance-Unit" shall mean the maximum amount to be advanced
hereunder with respect to any Unit and its associated Lot, which amount shall be
equal to (i) seventy-five percent (75%) of the Appraised Value-Unit of the
applicable Unit and its associated lot.

"Maximum Facility Commitment Amount" shall mean an amount equal to
TEN MILLION FIVE HUNDRED THOUSAND AND NO/100THS DOLLARS
($10,500,000.00).

"Members of Borrower" shall mean Westco Community Builders, Inc., a
California corporation and Dover Investments corp., a Delaware Corporation.

"Model Unit" shall mean the Units to be used as sales centers for the
Subdivision not to exceed four (4) Units.

"Note" shall mean a secured promissory note, in the original principal amount of
the Maximum Facility Commitment Amount, executed by Borrower as maker,
in favor of Lender as holder, in form and substance satisfactory to Lender.
"Potential Balancing Default" shall mean the failure to deposit with Lender,
within five (5) days after notice that the Loan is not "in balance", the amount 
of cash, cash equivalents or other security satisfactory to Lender, in its sole
discretion, necessary to put the Loan "in balance" pursuant to Section 5.4.

"Potential Default" shall mean the existence of any event which, with the
giving of notice, the passage of time, or both, would constitute an Event of
Default under any of the Loan Documents.

"Presold Unit" shall mean a Unit which shall be deemed sold only if a bona fide
purchaser for value (a) has executed a firm, non-contingent purchase agreement
(in form and substance acceptable to Lender), and (b) has made a non-refundable
cash deposit of not less than ONE THOUSAND AND NO/1OOTHS DOLLARS
($1,000).

"Release Price" shall mean, with respect to any Unit and its associated Lot, the
amount payable by Borrower to obtain a partial reconveyance of the lien of the
applicable Deed of Trust, which amount is further defined in Article 11, Section
2.7(f).

"Sales Contract" shall mean a bona fide written non-contingent agreement
between Borrower and a third person purchaser for sale in the ordinary course of
Borrower's business of any Unit and the related Lot.

"Subdivision" means Lots 1 through 80, as shown on that certain Map entitled
Tract No. 2770 Glenbriar Estate Unit No. 2 which was filed for record in the
Office of the Recorder for the County of San Joaquin, State of California in
Volume 33, page 51.

"Subdivision Appraisal" shall mean, with respect to the Subdivision, an
appraisal of each Lot and each type of Unit in the Subdivision (without regard 
to any standard upgrade items to be included in such Unit or any other options,
furniture, furnishings, fixtures and equipment to be included in such Unit), 
which appraisal shall be performed by an appraiser and otherwise be 
satisfactory to Lender in its sole and absolute discretion. In addition, the 
Subdivision Appraisal must include an absorption analysis setting forth the 
monthly projected sales rate for the type of Units covered by the Subdivision 
Appraisal and an Estimated Costs of Sale for the Units covered by the 
Subdivision Appraisal. The Subdivision Appraisal must comply with Lender's 
appraisal methodology as then in effect by internal Lender policies or by 
federal banking regulations.

"Subdivision Budget" shall mean, with respect to the Subdivision, the budget
of all Direct Costs and all Indirect Costs necessary for or related to 
construction, of all Units to be constructed in the Subdivision, as approved 
by Lender in its reasonable discretion, together with any amendments or 
modifications thereof consented to by Lender in its sole and absolute 
discretion.

"Subdivision Plans and Specifications" shall mean, with respect to the
Subdivision, the final plans and specifications for each type of Unit to be
constructed in the Subdivision, with evidence of appropriate approvals of each
Governmental Authority shown thereon, as approved by Lender in its sole and
absolute discretion and as changed from time to time with the prior written
approval of Lender.

"Substantially Complete" shall mean, with respect to a unit, that: (i) such unit
has been substantially completed in accordance with the applicable Subdivision
Plans and Specification; (ii) a valid notice of completion has been recorded 
in the Official Records of the County; and (iii) all inspections by any 
Governmental Authority have been completed and all necessary certificates and 
approvals have been obtained.

"Termination Date" shall mean twelve (12) calendar months from the Effective
Date, unless such date is extended on the Conversion Date.

"Title Company" shall mean the title insurance company selected by Borrower
and approved by Lender in its sole and absolute discretion to provide any Title
Insurance Policy.

"Title Insurance Policy" shall mean, with respect to the Subdivision, a title
insurance policy in the form of an American Land Title Association Loan
Extended Coverage Policy of Title Insurance, insuring Lender
that, on the date the Deed of Trust is recorded against the Subdivision,
Borrower owns fee simple title to the Subdivision and that the Deed of Trust
is a valid lien, in the amount of the Maximum Facility Commitment Amount.
The Title Insurance Policy shall contain such endorsements (including,
without   
limitation, a variable interest rate endorsement, a revolving line of credit
endorsement and a tie-in endorsement) and shall be subject to such
reinsurance and coinsurance agreements as Lender reasonably
requires and shall be subject only to such exceptions to coverage as approved
by Lender in its sole and absolute discretion in writing prior to the date such
Deed of Trust is recorded.

"Total Available-Unit" shall mean, as of each Borrowing Base Determination
Date with respect to each Unit and each Presold Unit and its associated Lot, an
amount equal to the sum of: W the applicable Construction Draw Available-Unit
plus (ii) the applicable Lot Advance.

"Total Construction Draw-Unit' shall mean, with respect to each Unit and each
Presold Unit which constitutes Eligible Collateral, an amount equal to the sum
of: (i) the Maximum Advance-Unit for such Unit minus (ii) the Lot Advance for
such Unit.

"Unit" shall mean a detached single-family dwelling (i) which is unsold, (ii)
constructed or to be constructed on a Lot, and (iii) described in the 
Subdivision Plans and Specifications, including, without limitation, any 
furniture, furnishings, fixtures and equipment to be installed therein as 
shown in the Subdivision Plans and Specifications.

"Unit Budget" shall mean the total, as shown on the Subdivision Budget, of all
Direct Costs and all Indirect Costs necessary for or related to construction 
of each Unit and each Presold Unit in the Subdivision.

                                ARTICLE 11
                                 THE LOAN

2.1   Commitment. Subject to the terms and conditions of this Agreement,
Lender agrees, at any time and from time to time after the Effective Date
and prior to the date which is thirty (30) days prior to the Maturity Date, to
make Advances to Borrower, at the request of Borrower, with respect to
Eligible Collateral; provided, however, that the aggregate amount of
Advances outstanding at any time and from time to time shall not exceed
the Available Commitment. Proceeds of Advances may be used solely for
the purposes set forth in Section 5.1. Advances shall be on a revolving
basis. Subject to the terms and conditions contained herein, Advances
repaid may be reborrowed. Although the outstanding principal balance of
the Note may be zero from time to time, the Loan Documents shall remain
in full force and effect until the Commitment terminates and all obligations
of Borrower are paid and performed in full. Upon the occurrence of a
Potential Default, Potential Balancing Default or Event of Default, Lender,
in its absolute and sole discretion and without notice, may suspend the
Commitment to make Advances. In addition, upon occurrence of a
Potential Default, Potential Balancing Default or Event of Default, Lender,
in its absolute and sole discretion and without notice, may terminate the
Commitment to make Advances.

2.2   Evidence of Indebtedness and maturity. The Loan shall be evidenced by
the Note in the principal amount of the Maximum Facility Commitment
Amount. The outstanding principal balance of the Loan, together with
accrued interest thereon and all other amounts payable by Borrower under
the terms of the Loan Documents, shall be due and payable on the Maturity
Date.

2.3   Interest. The outstanding balance of the Note shall bear interest at the
rate per annum specified in the Note, which interest shall be due and
payable as specified therein.

2.4   Security. Payment of the Note 3nd performance of all of Borrower's other
obligations under the Loan Documents (excluding any and all
Environmental Indemnities) shall be secured by the following: (a) any and
all Deeds of Trust; (b) any and ,I[ Security Agreements and related UCC-1
financing statements; (c) any and all fixture filings, and (d) such other
security interests in property of Borrower as Lender shall reasonably
require.

2.5   Environmental Indemnities. Lender shall be indemnified with respect to
environmental matters by the Environmental Indemnities.

2.6   Prepayments.

(a)   Mandatory Prepayments.

(i)   Advances In Excess of Available Commitment. If for any reason at any
time the aggregate amount of all outstanding Advances exceeds the Available
Commitment, Borrower shall, within two (2) Business Days of receiving written 
notice of such excess, make a payment to Lender in an amount equal to such 
excess amount.

(ii)  Release of Presold Units, Units and Lots. To obtain the release of a
Presold Unit, Unit and its related Lot from the lien or encumbrance of a Deed
of Trust, Borrower shall be in full compliance with the requirements of
5ection 2.7 and Borrower, without notice or demand, shall, make payment to 
Lender in an amount equal to the applicable Release Price for such Unit.


(b)   Voluntary Payments. Subject to Section 2.7 with respect to the release
of a Presold Unit, Unit and/or Lot, Borrower may, at any time, without penalty 
or premium, prepay all or any portion of the outstanding Advances.

2.7   Conditions Precedent to Release of Presold Units. Units and Lots.
Lender shall have no obligation to release any Presold Unit, Unit and/or
Lot from the lien or encumbrance of a Deed of Trust unless all of the
following conditions are satisfied:

(a)   There shall be no Potential Default, Potential Balancing Default or
Event of Default under this

Agreement or any of the other Loan Documents.

(b)   Borrower shall have given Lender at least five (5) Business Days prior
written notice.

(c)   The Title Company shall issue an appropriate endorsement to the
applicable Title Insurance Policy ensuring that, notwithstanding the release 
of its interest in such Presold Unit, Unit and/or Lot, the lien of the 
applicable Deed of Trust shall continue to be a first lien on the remaining 
portion of the Subdivision, subject to no exceptions to title other than those 
shown on such Title Insurance Policy as of the date of issuance.

(d)   Lender shall have received satisfactory evidence that the portion of the
Subdivision not to be released will have the benefit of such easements and 
rights of way in, over and through the Units and/or Lots to be released as are, 
in Lender's and the Title Company's judgment, necessary or desirable to 
provide or assure access vo and from, utility service to, parking
for and support to the remaining portion of the Subdivision.

(e)   Borrower shall pay all costs associated with the release of Lender's
interest in such Presold  Unit, Unit and/or Lot, including without limitation, 
the endorsement referred to above and reasonable attorneys' fees. 
Borrower shall, concurrently with such release, pay to Lender the following
release prices plus any interest which is outstanding on said Unit:

PLAN NO.              UNIT

1                     $168,750.00
1x                    $176,250.00
2                     $176,250.00
2x                    $174,750.00
3                     $182,250.00
3x                    $187,500.00
4                     $193,500.00            
4x                    $198,750.00

(9)   The Release Price paid to Lender upon the release of any Presold Unit
or Unit shall be applied first to reduce Advances made with respect to the 
Unit Budget to which such Presold Unit or Unit relates.

2.8   Credit for Principal Payments. Any payment made upon the outstanding
principal balance of the Loan shall be credited as of the business day upon
which the applicable following condition has occurred by no later than
11:00 a.m. (Pacific Standard Time or Pacific Daylight Time, as
appropriate):

(a)   In the case of a principal payment made by a federal funds wire transfer,
receipt by Lender of written advice from the Federal Reserve System confirming 
that the transferred amount has been credited for the account of Lender;

(b)   In the case of a principal payment made by a cashier's check, receipt by
Lender of such cashier's check at the address designated elsewhere herein for 
the delivery to Lender of notices; or

(c)   In the case of a principal payment made by any other means, upon the
funds constituting such payment having become unconditionally available for 
the use of Lender.

2.9   Extension of Conversion Date. Upon Borrowers written request at any
time at least thirty (30) days, but not more than sixty (60) days, before the
Conversion Date, Lender will consider extending the Conversion Date for
an additional six (6) calendar months. Approval of Borrowers request to
extend the Conversion Date for an additional six (6) calendar months shall
be at Lender's sole and absolute discretion, based on Lender's then
prevailing underwriting standards and Lender's then interpretation of
regulatory guidelines, and, if approved, may be subject to Borrower's
satisfaction of one or more conditions required by Lender in its sole and
absolute discretion including but not limited to the following Conditions
Precedent. No extension of the Conversion Date shall be given, or deemed
given, by Lender unless it is evidenced by a written document signed by
Lender. When requesting consideration of extending the Conversion Date
for an additional six (6) calendar months, Borrower shall deliver to lender
such documentation and information as Lender may reasonably require.

(a)   Conditions Precedent to the Extension of Conversion Date:

(i)   On or before the Conversion Date Borrower shall pay Lender in
immediately available funds the Conversion Fee;

(ii)  On or before the Conversion Date a cumulative of at least forty (40)
Units shall have been delivered/closed to third party buyers and Lender shall
have received the Release Price for each of the forty (40) Units;

(iii) Borrower shall represent and warrant to Lender that no Default or Event
of Default, breach or failure of condition has occurred or exists under the Loan
Documents, or would exist after notice or passage of time or both, at the time
of the Conversion Date; 

(iv)  There has occurred no material adverse change, 
as determined by Lender, in the financial condition of Borrower or any 
guarantor or other person or entity in any manner obligated to Lender under 
the Loan Documents from that which existed as of the Effective Date; and

(v)   Except as modified by the exercise of the Extension of the Conversion
Date and other modifications approved by Lender and made in accordance
with the provisions of this Agreement, the Loan Documents shall remain
unmodified and in full force and effect.

(vi)  If required by Lender, Lender shall have received an updated appraisal
establishing that the Appraised Value Unit is equal to or greater than the
Appraised Value Unit on the Effective Date.

          
                                  ARTICLE III
                                 EFFECTIVE DATE
      
3.1   Conditions Precedent to Effectiveness of this Agreement. Lender's
obligation to make the Loan and perform any of its other obligations under
this Agreement shall terminate if, on or before the Termination Date,
Borrower does not satisfy all of the following conditions, in each case as
determined by Lender in its absolute and sole discretion:

(a)   Representations and Warranties Accurate. The representations and
warranties by Borrower in the Loan Documents are correct on and as of the 
Effective Date as though made on and as of such Date.

(b)   Defaults. No Potential Default, Potential Balancing  Default or Event of
Default exists under this Agreement or any of the other Loan Documents.

(c)   Loan Documents. Lender shall have received the following documents,
each duly executed by the parties thereto and in form and substance 
satisfactory to Lender in its absolute and sole discretion:

(d) this Agreement; (b) the Note; (c) Repayment and Completion Guaranties
from Glenbriar Joint Venture, a California general partnership and Glenbriar 
Venture No. 2, LLC, a California limited liability company; and (d) such other 
documents that Lender reasonably may require.

(d)   Payment of Fees and Other Costs and Expenses. Borrower shall have
paid the appraisal fee, the Commitment Fee, the Documentation Fee and all 
other costs and expenses to be paid by the Borrower in connection with the 
Loan.

(e)   Formation Documents. Lender shall have received and approved the
following (as applicable):

(i)   Current Certificates of Good Standing from the California Secretary of
State for Borrower.

(ii)  Certified copies of the articles of incorporation and bylaws, together 
with certified resolutions authorizing this transaction, and incumbency
certificates verifying the authority of the signatories, for Borrower.

(f)   Financial Statements. Lender shall have received and approved all
financial statements of Borrower and such other parties as are required by 
Lender.

(g)   Other Items or Actions. Lender shall have received and approved such
other agreements, documents, and instruments, and Borrower shall have 
performed such other actions, as Lender may reasonably require.
                          
                              ARTICLE IV
                         ELIGIBLE COLLATERAL

4.1   Restriction during Conversion Period. Notwithstanding anything to the
contrary set forth in this Article IV or anywhere else in the Loan
Documents, construction of Units may be approved by Lender and added
to Eligible Collateral only before the Termination Date.

4.2   Removal of Units from Eligible Collateral: Ineligible Collateral.
Borrower shall not be entitled to include Units and their related Lots in
Eligible Collateral if such Units fail to comply with any of the
following:

(a)   Construction Requirements.

(i)   Within seventy-five (75) days of its Admission Date, the Unit shall not
be at least twenty percent (20%) complete, in accordance with the stage of 
completion tables set for the Exhibit C attached hereto.

(i i) Within two hundred seventy (270) days of its Admission Date, the Unit
shall not be Substantially Completed.

(iii) More than fifteen (15) Inventory Units which may be under
construction at any one time.

(b)   Limitation on Term of Units in Eligible Collateral. A Unit which is
not a Model Unit shall not constitute Eligible Collateral for more than twelve 
(12) calendar months.

4.3   Extraordinary Events Affecting Units, Presold Units and Lots, or
Subdivision. Upon the occurrence of any of the following events, Units,
Presold Units and related Lots at any time constituting Eligible Collateral
may be declared by Lender to no longer be Eligible Collateral:

(a)   Material Damage, Destruction, or Condemnation. Any Unit or
Presold Unit and related Lot is materially damaged, destroyed, or becomes 
subject to any condemnation proceeding.

(b)   Default Regarding Title Insurance. The requirements of the Loan
Documents for title insurance with respect to any Unit or Presold Unit 
are not satisfied.

(c)   Hazardous Substance. A Hazardous Substance is discovered to be
present on, in, under or about any Unit or Presold Unit and/or its related Lot.

(d)   Material Change to Subdivision Plans and Specifications. The
Subdivision Plans and Specifications pertaining to any Unit or Presold Unit 
are changed without Lender's prior written Consent, which shall not be 
unreasonably withheld.

(e)   Maintained in Good Condition. Any Unit or Presold Unit and related
Lot is not maintained in good condition and repair.

4.4   Lien Continues on Ineligible Collateral. Unless Lender in its sole and
absolute discretion determines otherwise, any Unit or Presold Unit and the
related Lot which are subject to the lien of a Deed of Trust but which later
become Ineligible Collateral as a result of Sections 4.2 will remain subject
to the lien and encumbrance of the Deed of Trust until the conditions
precedent specified in Section 2.7 have been satisfied with respect to such
Unit or Presold Unit and related Lot.

4.5   Classification and Reclassification of Units. Borrower may classify or
reclassify units as to type from time to time, or change Borrower's
proposed classification of any and all Units, provided that such reclassified
Unit meets the requirements set forth herein for that type of Unit. In the
event any Presold Unit ceases to constitute a Presold Unit for any reason,
then any such Presold Unit shall automatically become an Inventory Unit,
and Borrower agrees to immediately comply with all conditions,
restrictions and limitations applicable to an Inventory Unit. In the event
any Inventory Unit becomes a Presold Unit, Borrower agrees to
immediately comply with conditions, restrictions and limitations
applicable to a Presold Unit.
      
                                 ARTICLE V
                          DISBURSEMENTS OF THE LOAN

5.1   Use of Advances. Borrower shall use Advances of the Loan only for the
payment of or reimbursement for costs, expenses and fees included in the
respective Unit Budget in connection with the construction of
Units or Presold Units constituting Eligible Collateral in such Unit or Presold
Unit, such payment of or reimbursement for costs, expenses and fees to be
made only after the same have been incurred by Borrower, provided, however, 
in no event shall (i) the Advances outstanding with respect to any Unit or 
Presold Unit and its related Lot exceed the Maximum Advance-Unit
applicable thereto, (ii) the Advances outstanding under the Loan exceed the 
Available Commitment, or (iii) the Advances outstanding with respect to Units 
or Presold Units in the Subdivision exceed the lesser of (a) the sum of the 
Total Available Unit for all Units or Presold Units that then constitute 
Eligible Collateral in the Subdivision, (b) the Maximum Subdivision Commitment 
Amount. Costs related to the construction of Units or Presold Units and the 
improvements of their related Lots shall be deemed to have been "incurred" by 
Borrower at the following times: W Direct Costs: when the labor has been 
performed or the materials have been supplied and incorporated into the 
applicable Unit or Presold Unit and related Lot, payment therefor has been 
requested by the contractor or supplier thereof, and such contractor or 
supplier is entitled thereto; (ii) Indirect Costs: when such costs are due and 
payable and, if applicable, the services relating thereto have been rendered 
or the value thereof has been received by Borrower, or with respect to amounts 
payable to Lender, when such amounts becomes due and payable pursuant to the 
Loan Documents.

5.2   Requests for Advances. Borrower shall request disbursements of the
Loan periodically and not more frequently than once each month.
Requests shall be evidenced by the Borrowing Base Certificate.

5.3   Determination of Amount of Advances.

(a)   Borrowing Base Certificate. Borrower shall deliver a Borrowing Base
Certificate to Lender at any time Lender approves construction of any 
additional Unit or Presold Unit pursuant to Section 5.1 herein. 

(b)   Amount of Advances. The amount of each Advance requested by
Borrower shall be reviewed and subject to approval by Lender based upon: 
(i) the Borrowing Base Certificate most recently submitted by Borrower 
(adjusted to reflect Units or Presold Units released pursuant to Section 2.7
and other Units removed from Eligible Collateral pursuant to Section 4.2 and
4.3, (ii) Lender's inspections made pursuant to Section7.3 (as such inspections
may result in any adjustments to reflect any variance between (A) the 
Borrowing Base Certificate, and (B) the results of such inspections), and 
(iii) such other information as Lender may reasonably require in order to 
verify such amounts.

(c)   Conditions to Disbursements. Provided that: (i) no Event of Default,
Potential Default or Potential Balancing Default exists under this Agreement or 
any of the other Loan Documents; (ii) all of the conditions set forth in 
Exhibit B have been satisfied; and (iii) the Loan is -in balance" as required 
in Section 5.4; then Lender shall disburse or issue, as the case may be, within
ten (10) Business Days after receipt of the Draw Request Documents, the
Advance approved by  Lender. Borrower's Funds and any other amounts
deposited with Lender pursuant to Section 5.4 to put the Loan "in balance"
shall be the next funds disbursed by Lender. Unless Lender otherwise
elects, all Advances shall be deposited into the account requested by Borrower
and approved by Lender. Lender shall have no obligation hereunder to issue 
"set aside" letters. As used herein, "set aside" Letters shall mean letters 
to Governmental agencies, contractors or other third parties pursuant to which 
Lender agrees to allocate Loan proceeds for the construction of certain 
improvements.

5.4   Loan Balancing

(a)   As a material condition to the making of the Loan and as a condition
precedent to Lender's duty to disburse proceeds of the Loan, Borrower
shall pay all costs, expenses and fees required to develop, construct,
market, sell and carry all of the Units or Presold Units constituting Eligible
Collateral which are in excess of the then applicable Available Commitment. 
Lender shall be obligated to disburse proceeds of the Loan only when the Loan
is "in balance." The Loan shall be "in balance only at such times as
Borrower has invested sufficient funds into the payment of such costs,
expenses and fees so that, in Lender's sole judgment, the funds then or to
become available under the Loan, plus any funds deposited by Borrower
into the Borrower's Fund Account, shall be sufficient to fully develop,
complete, market, sell and carry all of the Units or Presold Units
constituting Eligible Collateral and to pay all such costs, expenses and
fees (including without limitation, all interest and all other sums which
may accrue or be payable under any Loan Documents) until the Maturity
Date. The determination as to whether or not the Loan is "in balance"
may be made by Lender at any time and for any reason, including with
each request for a disbursement of the Loan.

(b)Borrower shall, within five (5) days after notice from Lender that the
Loan is not "in balance,"  deposit with Lender into the Borrower's Funds 
Account in cash the  amount necessary to put the Loan "in balance." No 
interest shall be paid by Lender on amounts deposited with Lender pursuant 
to this Section 5.4.

5.5   Payment of Interest. Interest that accrues and becomes due under the Note
shall be disbursed from the interest reserve in accordance with the
provisions set forth in Exhibit B herein. At such time that the interest
reserve is depleted, Borrower shall pay all interest that accrues on the Note
from its own funds. In the event that Borrower fails to pay interest as
required under the terms of the Note or any other amounts which may
accrue or be payable under any Loan Document, Borrower hereby
authorizes Lender to disburse, at Lender's option, the proceeds of the Loan
to pay interest accrued on the Note or other amounts which may accrue or
be payable under any Loan Documents, notwithstanding that Borrower
may not have requested a disbursement of such amount. Lender in its sole
discretion may make such disbursements notwithstanding the fact that the
Loan is not "in balance" or that an Event of Default, Potential Balancing
Default or Potential Default has occurred and is continuing under the terms
of this Agreement or any other Loan Document. Such disbursements shall
be added to the outstanding principal balance of the Note. The
authorization hereby granted shall be irrevocable, and no further direction
or authorization from Borrower shall be necessary for Lender to make such
disbursements. No such disbursement shall be construed as a waiver by
Lender of any default by Borrower or any requirement that Borrower keep
the Loan "in balance" as required in Section 5.4. Nothing contained in this
Section 5.5 shall require Lender to disburse Loan proceeds to pay interest.

                                ARTICLE VI
                      REPRESENTATIONS AND WARRANTIES

As an inducement to Lender to execute this Agreement and to disburse the
proceeds of the Loan, Borrower represents and warrants to Lender the truth and
accuracy of the matters set forth in this Article VI.

6.1   Status. If Borrower is a corporation, it is duly organized, validly 
existing, in good standing under the laws of the state of its incorporation, 
has stock outstanding which has been duly and validly issued, and is qualified 
to do business and is in good standing in the state in which the Subdivision is
located with full power and authority to consummate the transactions
contemplated hereby. If Borrower is a partnership, it is duly formed and
validly existing and, if required under the laws of the state in which the
Subdivision is located, is fully qualified to do business therein, with full
power and authority to consummate the transactions contemplated hereby.

6.2   Authority of Borrower. Borrower, has full power and authority to
execute, deliver and perform all of its obligations under this Agreement
and all other applicable Loan Documents. This Agreement and all other
Loan Documents to which Borrower is a party have been duly and validly
authorized, executed and delivered by Borrower and constitute legally
valid, binding and enforceable obligations of Borrower which have not and
will not constitute a breach or default under any agreement, court order,
judgment or law by or under which Borrower or the Subdivision is bound
or may be affected.

6.3   Compliance with Law To the extent required by applicable laws or
restrictive covenants, prior to requesting Lender's approval of the
Subdivision, the Subdivision Plans and Specifications will be approved by
all Governmental Authorities which have jurisdiction over the Subdivision
or construction thereon and the beneficiaries of any such covenants. Prior
to requesting Lender's approval of the Subdivision, Borrower will have all
authorizations, consents and licenses, including, without limitation,
building permits, annexation agreements, plot plan approvals, subdivision
approvals, environmental approvals (including an environmental impact
report or valid negative declaration if required under applicable law), sewer
and water permits and zoning and land use entitlements which are
necessary for the construction and operation of the Units or Presold Units
in the Subdivision in accordance with the Subdivision Plans and
Specifications and in accordance with all applicable building,
environmental, subdivision, land use and zoning laws. Prior to requesting
Lenders approval of Subdivision, the Subdivision will consist of legal and
separate lot(s) under the California Subdivision Map Act (California
Government Code Sections 66410 66499.37, as amended from time to
time) and for tax assessment purposes. All construction of Units and
Presold Units shall be in full compliance with all applicable laws and
regulations. At the time that Lender's approval of the Subdivision is
requested and at all times thereafter, the Subdivision will fully comply and
the Units and Presold Units, when competed, will fully comply with all
restrictive covenants and all applicable laws and regulations, including
without limitation, all building codes, Environmental Laws, the Americans
With Disabilities Act (Public Law 101-336) and the California Fair
Housing Act of 1992.

6.4   No Litigation. There is no litigation, action, suit, or proceeding pending
or threatened against Borrower, Members of Borrower or the Subdivision
which may in any manner whatsoever substantially adversely affect the
validity, priority or enforce ability of any of the Loan Documents or the
development, construction, marketing, sale or occupancy of the
Subdivision, the Units and Presold Units constructed or to be constructed
thereon, the related Lots or any part thereof.

6.5   Financial Position. The financial statements and all financial data
heretofore delivered to Lender in connection with the Loan and/or relating
to Borrower or Members of Borrower, are true, correct and complete in all
material respects. Such financial statements comply with the requirements
of Section 7.16 and accurately present the financial position of the parties
who are the subject thereof as of the date thereof. No material adverse
change has occurred in the financial position reflected in the most recent
financial statement. Except for this Loan, no borrowings  have been made
by Borrower since the date thereof which are secured by, or might give rise
to, a lien or claim against the Subdivision, the proceeds of this Loan, or
other assets of Borrower.

6.6   Costs, Expenses and Fees. On a line-by-line and total basis, the costs,
expenses and fees shown on the Unit Budgets are true, correct and
complete, and represent the total of all costs, expenses and fees which
Borrower expects to pay or may be or become obligated to pay to develop,
construct, market, sell and carry the Units and Presold Units to be
constructed through the Maturity Date.

6.7   Utilities. Telephone services, gas, electric power, storm sewers, sanitary
sewers and water facilities are or will be available to the Subdivision,
adequate to serve the Subdivision, exist at the boundary of each Lot in the
Subdivision and are not subject to any conditions, other than normal
charges to the utility supplier, which would limit the use of such utilities.
Borrower has obtained letters from utility providers evidencing a
commitment to serve the Subdivision with all utilities necessary for the
development, construction, marketing and sale of the Units and Presold
Units. All streets and easements necessary for development, construction,
marketing and sale of the Units and Presold Units will be available to
occupy the Units and Presold Units.

6.8   Personal Property. Prior to granting any security interest in the 
Collateral, Borrower will be, and will thereafter continue to be, the sole 
owner of the Collateral free from any adverse lien, security interest or 
adverse claim of any kind whatsoever, except for liens or security interests 
in favor of Lender.

6.9   No Condemnation or Casualty. No condemnation or other like
proceedings are pending or threatened against the Subdivision which
would impair the full utilization of the Subdivision in any manner
whatsoever. No casualty has occurred to the Subdivision.
6.10  No Defaults. There is no default, Potential Default, Potential Balancing
Default or Event of Default on the part of Borrower or Members of
Borrower under this Agreement or any Loan Document.

6.11  Defects. There are no defects, facts or conditions affecting the
Subdivision which would make it unsuitable for the development,
construction, marketing or sale of the Units and Presold Units.

6.12  Hazardous Substances. There are no Hazardous Substances in existence or
construction, released, deposited, stored, disposed, placed or located in, on
or under the Subdivision or the Units or the Presold Units or other
improvements located thereon. There are no underground storage tanks
located at the Subdivision. All Units and Presold Units and other
improvements thereon are and, upon their completion, all Units and
Presold Units and other improvements located thereon will be free of
Hazardous Substances and in full compliance with all Environmental Laws.

6.13  Representations and Warranties Upon Requests for Advances. Each
request for an Advance shall be a representation and warranty by Borrower
to Lender that the representations and warranties in this Article VI are
correct and complete as of the date of the Advance except as otherwise
disclosed in writing.

                             ARTICLE VII
                        COVENANTS OF BORROWER

As an inducement to Lender to execute this Agreement and to make each
disbursement of the Loan, Borrower hereby covenants as follows:

7.1   No Liens. Borrower shall not permit any lien, levy, attachment or 
restraint to be made or filed against the Subdivision, any Unit, Presold Unit 
or any Lot or permit any receiver, trustee or assignee for the benefit of 
creditors to be appointed to take possession of the Subdivision, any Unit, 
Presold Unit or any Lot, except for any claims filed or asserted against any 
such property and concerning which Borrower is in full compliance with the
provisions of Section 7.8 below.

7.2   Compliance with Laws. Borrower shall comply with, and the
Subdivisions, all Units, Presold Units and all Lots shall comply with all
applicable laws, statutes, regulations, codes and requirements (including
without limitation, all Environmental Laws, building, zoning and use laws,
requirements, regulations and ordinances, the American With Disabilities
Act and the California Fair Housing Act of 1992), all restrictive covenants
and all obligations created by private contracts and leases which affect
ownership, development, construction, marketing, use or sale of the
Subdivision, any Units, Presold Units or any Lots. If requested by Lender,
Borrower shall deliver to Lender, promptly after receipt thereof, copies of
all permits and approvals received from any Governmental Authority
relating to the development, construction, marketing, use, occupancy or
sale of the Subdivision, any Units or any Lots.

7.3   Construction Information; Inspections. From time to time, and within
ten (10) business days of receipt from Lender of a request therefor,
Borrower shall deliver to Lender:

(a)   a complete list stating 0) the name, address and phone number of each
contractor, subcontractor
and material supplier employed or used for construction of the Improvements,
and (ii) the dollar amount, including changes if any, of each contract and
subcontract, and the portion thereof, if any, paid through the date of such 
list; and

(b)   copies of each contract and subcontract identified in such list, including
any changes thereto; and

(c)   a cost breakdown, in a form reasonably acceptable to Lender, stating the
projected total cost of constructing the Improvements, and that portion, if 
any, of each cost item (i) which has been incurred, and (ii) which has been 
paid, all as of the date of such cost breakdown; and

(d)   a construction progress schedule, in a form reasonably acceptable to
Lender, showing the progress of construction and the projected sequencing and 
completion time for uncompleted work, all as of the date of such schedule; and

(e)   with respect to any item designated  above which has been previously
delivered, such update thereof as Lender may reasonably request.

Lender is expressly authorized to contact any contractor, subcontractor or
material supplier and, at all reasonable times, to enter the Property and 
inspect the Improvements and the work of construction in order to verify 
information disclosed pursuant to this Section, or for any other purpose.

7.4   Commencement and Completion. Unless otherwise provided by this
Agreement, Borrower shall promptly commence construction of the
Improvements and shall diligently continue construction to Completion
prior

to the Maturity Date. For purposes of the Loan Documents, "Completion" means
that an Improvement is constructed and has been fully completed in accordance
with the Plans and Specifications, as reasonably approved by Lender; a valid
notice of completion has been recorded and the applicable lien periods have
expired or, in lieu thereof, Lender has received lien waivers or releases in 
form and content satisfactory to Lender evidencing actual payment for all work
performed from all contractors, subcontractors, laborers and material men
employed or furnishing materials in connection with such Improvement; all
claims of liens with respect to such Improvement, and all stop notices with
respect to the Property and Improvements, that may have been recorded or notice
thereof served on Lender have either been paid in full and released, or Borrower
has posted an appropriate surety bond to discharge the same; completion has been
approved and certified by Lender's inspecting architect and a certificate of 
substantial completion has been signed by Borrower, the design architect and the
general contractor and delivered to Lender, and no material punch-list items
remain to be completed; Borrower shall have procured and delivered to Lender
a CLTA title insurance indorsement No. 101.2, or its equivalent, and such
additional title insurance endorsements as are reasonably required by Lender
showing the Deed of Trust to be a first lien or charge upon the Property,
excepting only such items as have previously been approved by Lender;
Borrower has delivered to Lender the original or a certified copy of an
unconditional Certificate of Occupancy for the Improvement; Lender has
received photographs of the completed Improvement; If requested by Lender,
Borrower will provide copies of all warranties from suppliers covering 
materials, equipment and appliances included within the Improvement; (i) 
Lender has received evidence that all insurance required hereby is in full 
force and effect with respect to the Improvement; (j) Lender has received 
evidence reasonably acceptable to Lender that all Requirements as defined in 
Section 7.6 relating to such Improvement have been complied with or satisfied; 
and (k) no Default exists hereunder. Notwithstanding anything to the contrary 
herein, no more than sixty (60) Units within the Subdivision may be under 
construction or completed at any time. Unless Lender consents in writing to 
an earlier commencement date, Borrower shall commence construction of twenty 
(20) Units without delay after recordation of the Deed of Trust. Construction 
of additional Units may be started only upon the sale of not less than six (6) 
Units. Notwithstanding anything to the contrary herein, no more than fifteen 
(15) Inventory Units may be under construction or completed at any time. 
Borrower shall complete construction of all of the Improvements on or before 
the Maturity Date.  Borrower covenants and agrees to use its best efforts to 
sell Units in accordance with a marketing plan approved by Lender.

7.5   Force Majeure. The time within which construction of the Improvements
must be completed shall be extended for a period of time equal to the
period of any delay directly affecting the construction work which is
caused by fire, earthquake or other acts of God, strike, lockout, acts of
public enemy, riot, insurrection, or governmental regulation of the sale or
transportation of materials, supplies or labor provided Borrower furnishes
Lender with written notice (as specified in Section 10.2), of any such delay
within ten (10) business days from the occurrence of any such delay. In no
event, however, shall the time for completion of the Improvements be
extended beyond the maturity date set forth in the Note.

7.6   Construction. Borrower shall construct the Improvements in a
workmanlike manner according to the Plans and Specifications and the
recommendations of any soils or engineering report approved by Lender,
and all Units and Presold Units, once commenced, shall be roofed and
sided as quickly as reasonably possible to protect the same from the
elements. In constructing the Improvements, Borrower shall comply with
all applicable laws, ordinances, rules, regulations, building restrictions,
recorded covenants and restrictions, and requirements of all regulatory
authorities having jurisdiction over the Improvements or Property
(collectively "Requirements"). If necessary, the Plans and Specifications
shall be modified to comply with the Requirements. Lender, its
representatives, consultants and assigns, shall have access to the Property
and Improvements for the purpose of inspecting the same at all reasonable times.
At Borrower's expense, Borrower shall promptly correct any defects in the
Improvements, material deviations from the Plans and Specifications and
violations of any Requirements discovered by Borrower, or of which Borrower
receives notice and Borrower shall implement the recommendations of any soils
or engineering reports.

7.7   Changes to Subdivision Plans and Specifications. Borrower agrees to
obtain the prior written consent of Lender prior to making any changes in
the Subdivision Plans and Specifications for any type of Unit or Presold
Unit. It shall not be unreasonable for Lender to withhold its consent until
Lender obtains an appraisal for the applicable type of Unit or Presold Unit
with respect to any such material change.

7.8   Contesting Liens.

(a)   Borrower shall promptly discharge or cause to be discharged any
mechanics' or material men's liens or claims of lien filed or otherwise 
asserted against the Subdivision, any Lot, any Unit or any Presold Unit 
thereon, or any stop notices received by Lender, and any proceedings for the 
enforcement of any thereof to be promptly dismissed; provided, however, that 
Borrower shall have the right to contest in good faith and with diligence the 
validity of any such liens or claims upon providing, prior to the commencement 
of an action to enforce such lien or Claim, a security bond issued by a surety
acceptable to Lender in Lender's sole discretion which pursuant to applicable
law is sufficient to release such lien or claim of lien. Lender shall not be
required to make any further disbursements of the Loan until all such
mechanics' or material man's liens, claims of lien or stop notices have been
bonded against to Lender's satisfaction. In the case of stop notices, Borrower 
shall have the right to contest, in good faith and with diligence, the validity 
of any stop notice, provided that Borrower shall immediately provide to Lender 
a bond from a surety acceptable to Lender in its sole discretion and in form 
and amount sufficient to release such stop notice. Lender shall have no 
obligation to make any further disbursements of the Loan until all such 
mechanic's or material men's liens, claims of lien and stop notices have been 
fully released, discharged or bonded against to Lender's satisfaction.

(b)   If (1 ) Borrower fails to promptly discharge or contest liens, Claims of
lien or stop notices and provide the bond in the manner provided in Section
7.8(a) or (ii) after having complied with the provisions of Section7.8(a) 
there is an adverse conclusion to any such contest and Borrower does not 
cause any final Judgment or decree to be immediately satisfied and the lien 
or stop notice to be discharged, then Lender may, but shall not be required 
to, procure the release and discharge of any such lien or stop notice and any 
judgment or decree thereon, and in furtherance thereof may, in its reasonable 
discretion, affect any settlement or compromise or furnish any security or 
Indemnity as may be required by the Title Company. All amounts expended by 
Lender in connection with the provisions of this Section7.8(b) shall be 
deemed to constitute a disbursement of the Loan. In settling, compromising or 
arranging for the discharge of any liens or stop notices under this 
Section7.8(b), Lender shall not be required to establish or confirm the 
validity or amount of the lien or stop notice, but shall use commercially 
reasonable good faith efforts to do so.

7.9   Americans With Disabilities Act Compliance. Borrower represents and
warrants to Lender that the Improvements have been designed and shall be
constructed and completed, and hereafter maintained, in strict accordance
and full compliance with all of the requirements of the Americans with
Disabilities Act ("ADA"), of July 26, 1990, Pub. L. No. 101-336, 104 Stat.
327, 42 U.S.C.  12101, et. seq.  as amended  from time to time, if such
acts shall apply to the Improvements. Borrower is responsible for all ADA
compliance costs, including, without limitation, attorney's fees and
litigation costs.

7.10  Construction Responsibilities. Borrower shall be solely responsible for
all aspects of Borrower's business and conduct in connection with the
Property and Improvements, including, without limitation, to the quality
and suitability of the Plans and Specifications and their compliance with
the Requirements, the supervision of the work of construction, the
qualifications, financial condition and performance of all architects,
engineers, contractors, material suppliers, consultants and property
managers, and the accuracy of all applications for payment and the proper
application of all disbursements. Lender is not obligated to supervise,
inspect or inform Borrower or any third party of any aspect of the
construction of the Improvements or any other matter referred to above.
Any inspection or review by Lender is to determine whether Borrower is 
properly discharging its obligation to  Lender and may not be relied  upon 
by Borrower or any third party.  Lender owes no duty of care to Borrower or 
any third party to protect against, or to inform Borrower or any third party 
of, any  negligent, faulty, inadequate or defective design or construction 
of the Improvements.

7.11  Improvement District. Without Lender's prior written consent, Borrower
shall not, directly or indirectly, advocate or assist in the incorporation of
any of the Property or Improvements into any improvement or other
assessment district.

7.12  Delay. Borrower shall promptly notify Lender in writing of any event
causing a material delay or interruption of construction, or the timely
completion of construction. The notice shall specify the particular work
delayed, and the cause and period of each delay.

7.13  Surveys. At Lender's request, Borrower shall deliver to Lender: (a) a
perimeter survey of the Property; and (b) upon completion of the
foundations of the Improvements, a survey showing the location of the
Improvements on the Property and showing that the Improvements are
located entirely within the Property and do not encroach upon any
easement, or breach or violate any of the Requirements.

7.14  Bonds. Within five (5) business days of Lender's request, Borrower shall
procure from a surety acceptable to Lender, and deliver to Lender, dual
oblige performance and labor and material payment bonds in a form,
substance and amount acceptable to Lender and, if requested by Lender,
cause any such bond to be recorded and the Plans and Specifications and
Construction Agreement, if any, to be filed in the office of the County
Recorder of the County where the Property is located.

7.15  Corporate Structure. Borrower will not suffer or permit any amendments
to Borrower's articles of incorporation or by-laws without the prior written
content of Lender. Borrower shall maintain and preserve its existence and
all rights and franchises material to its business.

7.16  Financial Statements and Reports.

(a)   Within ninety (90) days after the end of each fiscal year of Borrower,
Borrower shall provide to Lender annual financial statements of Borrower and 
Members of Borrower, including a balance sheet, a cash flow statement, an 
income statement, and, if applicable, income accounts, and such 
other statements as may be reasonably required by Lender, prepared in
accordance with generally accepted accounting principles consistently applied
and certified as true and complete without qualification by Borrower or, if
required by Lender, a certified public accountant.

(b)   Within forty-five (45) days after the end of each month end of Borrower
and Members of  Borrower and its subsidiaries, Borrower shall provide interim 
financial statements as requested by Lender.

7.17  Expenses. Borrower shall pay all expenses, costs and disbursements of
every kind and nature incurred by or on behalf of Borrower during the term
of the Loan with respect to the development, construction, operation,
maintenance, management, marketing and sale of the Subdivision, the
Units, the Presold Units and the Lots, as applicable. Borrower shall pay
any and all valid Claims of any brokers or agents with whom it has dealt
who claim a right to any fees in connection with, arranging the financing
of the Subdivision, and shall Indemnity, defend and hold Lender harmless
from such Claims, whether or not they are valid.

7.18  Litigation. Borrower shall give Lender prompt written notice of any action
or proceeding commenced or threatened against Borrower, the Subdivision
or any portion thereof and will deliver to Lender copies of all notices, and
other information regarding such proceeding or action promptly upon
receipt or transmittal thereof.

7.19  Representations and Warranties. Until repayment of the Loan and the
full discharge of all other obligations secured by the Deed of Trust, the
representations and warranties of Article VI shall remain true and

complete.
7.20  Further Assurances. Borrower shall execute and deliver from time to time,
promptly after any request therefor by Lender, any and all Instruments,
agreements and documents and shall take such other action as reasonably
determined by Lender to be necessary or desirable to maintain, perfect or
insure Lender's security provided for herein and in the other Loan
Documents, including, without limitation, the execution of UCC-1 renewal
statements, the execution of such amendments to any and all Deeds of
Trust and the other Loan Documents and the delivery of such
endorsements to any Title Insurance Policy, all as Lender shall reasonably
require, and shall pay all fees and expenses (including reasonable attorneys'
fees) related thereto. Promptly upon the request of Lender, Borrower shall
execute and deliver a certification of nonforeign status consistent with the
requirements of Section 1445 of the Internal Revenue Code.

7.21  Environmental Matters.

(a)   Borrower shall, at its own expense, comply and cause all persons
entering the Subdivision to comply
with all Environmental Laws applicable to the Subdivision. Borrower shall
immediately advise Lender in writing of any W discovery of Hazardous
Substances on the Subdivision; or (ii) claim, action or 
order threatened or instituted by any third party (including Government
Authorities) against the Subdivision or Borrower relating to damages, cost
recovery, loss or injury resulting from any Hazardous Substances. Borrower
shall provide Lender with copies of all communications with any
third party (including Governmental Authorities) relating to any
Environmental Law or any claim, action or order relating to Hazardous
Substances at, on, under or in the Subdivision. Lender shall
have the right, at Borrower's expense, to retain a professional environmental
consultant to conduct an investigation of the Subdivision with respect to
Hazardous Substances or its compliance with Environmental Laws. Borrower
hereby grants to Lender, its agents, employees, consultants and
contractors, an irrevocable license and authorization to enter upon and inspect
the Subdivision and to conduct such tests and investigations on ' the
Subdivision as Lender, in its sole discretion, determines necessary. If any
remedial action is required to bring the Subdivision into compliance
with Environmental Laws, Borrower shall immediately notify Lender of such
situation and shall prepare a written plan setting forth a description of such
situation (and all environmental reports relating thereto) and the remedial
action that Borrower proposes to implement to bring the Subdivision into
compliance with all Environmental Laws. Borrower shall, at its own expense,
thereafter diligently and continuously pursue the remediation of the condition
necessary to bring the Subdivision into compliance with all Environmental
Laws.

(b)   To the fullest extent permitted by law, Borrower agrees to protect,
Indemnify, defend, save and hold
harmless Lender, its directors, officers, agents and employees from and against
any and all loss, liability, expense or damage of any kind or nature and from
any suits, claims or demands, including 
(i) any consequential damages; (ii) all damages to any natural resources, and
the costs of any required or necessary repair, clean up, response cost, or
remediation of the Subdivision or any portion thereof, and the preparation and
implementation of any closure, remedial or other required plans; and (iii) all
costs and expenses incurred in connection with clauses M and (ii), including
reasonable attorneys' fees and costs, whether in suit or not, to the extent
arising directly or indirectly, in whole or in part, out of (a) the existence 
or alleged existence of any Hazardous Substances on or under the Subdivision 
or in any of the Units or Presold Units, (b) the removal of or failure to 
remove any Hazardous Substances from the Subdivision or the Units or Presold 
Units, or (c) any activity involving Hazardous Substances with respect to the
Subdivision carried on or undertaken on or off the Subdivision, whether prior
to or during the term of the Loan, and whether by Borrower or any
predecessor-in-title or any employees, agents, contractors or subcontractors of
Borrower or any predecessor-in-title, or any third parties occupying or present
on the Subdivision. The foregoing Indemnity shall apply to any residual
contamination on or under the Subdivision that occurs prior to or during the
term of the Loan and to any contamination of any property or natural
resources arising in connection with any activity involving Hazardous
Substances with respect to the Subdivision that occurs prior to or during the
term of the Loan, respective of whether any of such activities were or will be
undertaken in accordance with applicable Environmental Laws. Upon
receiving knowledge of any suit, claim or demand asserted by a third party
that Lender believes is covered by this indemnity, 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. Lender
may also require borrower to so defend the matter. The obligations of Borrower
under this Section 7.2 1 (b) shall survive the closing of the Loan and the
repayment thereof.

7.22  Use of Loan Proceeds. Borrower shall use the proceeds from the Loan only
for the purposes set forth in Section 5.1. and except to the extent of
proposed borrowing heretofore disclosed to Lender, if any, it shall not
require and shall not avail itself of any additional extension of credit for
such purpose.

7.23  Pre-Sale Occupancy. Borrower shall not lease or otherwise permit
occupancy of any Unit or Presold Unit prior to the close of escrow of or
the transfer of title to any such Unit or Presold Unit.

7.24  Additional Reporting Requirements. Following the first Advance,
Borrower shall furnish 
lender:

(a)   Sales and Closing Reports. Commencing with the tenth (10th) day of
the first full calendar month following the commencement of sales activity for 
the Subdivision (unless sooner requested by Lender), and thereafter on the 
tenth (1Oth) day of every calendar month until the Loan is repaid in 
full, Borrower shall provide to Lender a report, certified as true and complete
by Borrower containing such information required by Lender regarding the
status of sales in the Subdivision.

(b)   Other Items and Information. Such other information concerning
Borrower and Members of Borrower, the Subdivision, any Unit, any Presold Unit 
or any Lot or the assets, business, financial condition, operations, property 
prospects, and results of operations of Borrower as Lender reasonably requests 
from time to time.

7.25  Updated Subdivision Appraisals. Lender shall have the right to order
updated Subdivision Appraisals from time to time. Each updated
Subdivision Appraisal, is subject to review and approval by Lender. In
connection with the preparation of any such appraisal, Borrower shall
provide to Lender such information as Lender may reasonably request, and
provide access to the Subdivision and any Unit or any Presold Unit to any
appraiser conducting such appraisal, or any employee or other consultant
engaged by Lender to review the appraisal. Based on any such updated
Subdivision Appraisal, Lender may adjust the Appraised Value-Unit and
the Maximum Advance-Unit for the effected Units or Presold Units to
reflect the values shown in such updated Subdivision Appraisal. Borrower
acknowledges that such adjustments may result in the Total Available-Unit
for the effected Units or Presold Units to be reduced, and, in turn, may
result in Borrower having to deposit Borrower's Funds with Lender to
bring the Loan "in balance" as required under Section 5.4. Borrower agrees
upon demand by Lender to pay to Lender the cost and expense for such
appraisals and a fee prescribed by Lender for review of each such appraisal
by Lender.

7.26  Verification of Costs. Lender shall have the right at any time and from 
time to time to review and verify all costs, expenses and fees with respect to
each Unit or Presold Unit and related Lot which is Eligible Collateral.
Based on its review and verification of costs, expenses and fees in each
Unit or Presold Unit, Lender shall have the right to require Borrower to
adjust all such budgeted amounts and, if necessary, to bring the Loan "in
balance" as required by Section 5.4.

7.27  Construction and Sa es Records. Borrower shall, at all times, maintain
complete and accurate records of Borrower's construction and sales
activities and shall, upon prior notice thereof by Lender, permit Lender to
review such records upon request by Lender at any time and from time to
time during regular business hours. Such records shall include, without
limitation, (a) any and all documents, instruments, contracts and
agreements relating to the construction or sale of any Lots or Units entered
into by Borrower with or for the benefit of purchasers, contractors,
subcontractors or other Persons, as applicable, (b) lien waivers and releases
with respect to all construction in place, (c) requests for disbursement and
vouchers submitted by contractors, subcontractors, or other Persons, and
(d) all permits, licenses and approvals necessary for the continuation and
completion of construction.

                              ARTICLE VIII
                       INSURANCE AND CONDEMNATION

8.1   Insurance Requirements.

(a)   Title Insurance. Borrower shall procure from a Title Insurer acceptable
to Lender, an LP-10 ALTA, 1992 Policy of Title Insurance ("Title Policy"), 
together with any endorsements which Lender may require, Insuring Lender, in 
the principal amount of the Loan, of the vesting in Borrower of fee title 
to, and the validity and the priority of the lien of the Deed of Trust upon, the
Property and Improvements, subject only to matters reasonably approved by
Lender in writing. During the term of the Loan, Borrower shall procure and
deliver to Lender, within five (5) business days of Lender's
written request to Borrower, such other customary endorsements to the Title
Policy as Lender may require, including but not limited 122 endorsements on
each advance hereunder.

(b)   Hazard Insurance. Borrower shall procure and maintain from an
insurer reasonably satisfactory to Lender and in an amount acceptable to 
Lender, fire and extended coverage insurance, including customary "Builder's 
All Risk" completed value insurance in the full amount of the replacement cost 
of the Improvements until Completion thereof, including a vandalism and 
malicious mischief endorsement and such other endorsements as Lender may 
require, insuring Lender against damage to the Property and Improvements. 
Lender and any successors or assigns of Lender shall be named under a Lender's 
Loss Payable Endorsement (form #438BFU or equivalent) attached to the policy
and, at Lender's or such successor's or assigns' request, the policy shall 
contain an agreed value clause sufficient (as reasonably determined by Lender) 
to eliminate any risk of co-insurance.

(c)   Liability Insurance. Borrower shall procure and maintain from an
insurer reasonably satisfactory to Lender a policy or policies of liability 
insurance with coverage and limits not less than $1,000,000.00 with an Umbrella 
Coverages not less than $1,000,000.00, insuring against liability 
for injury or death to any person and property damage occurring on the
Property or in the Improvements from any cause whatsoever. Such insurance
shall provide that the insurer waives any right to contribution from any other
liability insurance carried by Lender or its successors or assigns, as
applicable. Borrower shall provide to Lender policies or certificates
evidencing such insurance from insurers acceptable to Lender, naming Lender
(and Lender's successors and assigns) as additional insureds thereunder.

(d)   Worker's Compensation. Borrower shall, and Borrower shall require
all contractors working on the Improvements to, procure and maintain from 
insurers acceptable to Lender, worker's compensation insurance with statutory 
limits and with Lender and any successors and assigns of Lender named 
as additional insureds.

(e)   Blanket Coverage. Lender may accept, at its option, blanket insurance
policies in satisfaction of Borrower's obligations to provide insurance.

(f)   General. Borrower shall procure and maintain all other insurance
required by this Agreement and/or applicable law. Lender shall receive the 
originals of all required insurance policies, or other evidence of insurance 
acceptable to Lender. Borrower shall maintain all required insurance until the 
Loan is repaid. All insurance policies shall be issued by licensed insurance 
companies reasonably acceptable to Lender and shall provide that the insurance 
shall not be cancelable or materially changed without thirty (30) days prior 
written notice to Lender and its assigns.

8.2   Loss Proceeds.

(a)   If the Subdivision or any portion thereof encumbered by the Deed of
Trust shall be damaged or destroyed by an insured peril or otherwise, Lender 
may, at its option, upon written notice to Borrower, settle, adjust or 
compromise any and all claims. All proceeds of insurance with respect 
to any damage or destruction shall be payable to Lender and Borrower hereby
authorizes and directs  any affected insurance company to make payment of
such proceeds directly to Lender and Borrower shall promptly pay over to
Lender any such proceeds received by Borrower. Lender shall apply all
loss proceeds remaining after deduction of all expenses of collection and
settlement thereof, including, without limitation, attorneys' and adjustors' 
fees and charges, to the reconstruction of the Subdivision, provided that: (i) 
no Event of Default, Potential Balancing Default, or Potential Default exists
under any of the Loan Documents; (ii) Lender determines, in its reasonable
Judgment, that the damage destruction can be repaired and completed by the 
Maturity Date; (iii) Lender and all applicable Governmental Authorities shall 
have approved the final plans and specifications for reconstruction of the 
Subdivision; (iv) Borrower shall have delivered to Lender (A) a budget of all 
costs of reconstruction of the Subdivision, (B) a construction schedule for the 
reconstruction of the Subdivision, (C) a construction contract for the 
reconstruction work in form and content, and with a contractor, reasonably 
acceptable to Lender, and (D) such documents and agreements as Lender 
reasonably shall require; and (v) Lender shall have determined that after the 
reconstruction work is completed the value of the Subdivision, as determined 
by Lender in its reasonable discretion, shall be not less than the original 
appraised value of the Subdivision approved by Lender.
All proceeds so applied to the reconstruction of the Subdivision shall be
disbursed in accordance with this Agreement and only as repairs or replacements
are effected and as continuing expenses become due and payable. Any loss
proceeds remaining after completion of all necessary repairs shall be applied to
the outstanding principal balance of the Note, whether or not then due.

(b)   If any one or more of the conditions set forth in Section 8.2(a) are not
met: (i) Lender shall not be obligated to make any further disbursements
pursuant to this Agreement or the other Loan Documents and Lender. shall
apply all loss proceeds remaining after deduction of all of Lender's
costs and expenses incurred in connection therewith, to the repayment of the
outstanding balance of the Note, together with accrued interest, 
notwithstanding that the outstanding balance may not be due and payable; (i) 
if the loss proceeds are not sufficient to repay the Note in full, Borrower 
shall immediately pay the remaining balance together with accrued interest 
thereon; and (ii) if there are loss proceeds remaining after repayment of the 
Note in full, such remaining proceeds shall be paid over to the persons 
legally entitled thereto.

(c)   if there are no loss proceeds available after damage or destruction, upon
written notice to  Borrower and Borrower's failure to provide to Lender, 
within ten (10) days after Lender's delivery of such written notice, evidence, 
in a form reasonably satisfactory to Lender, of funds immediately available 
to Borrower and sufficient to repair and restore all such damage and
destruction, then the outstanding balance of the Note, together with accrued
interest, shall become immediately due and payable and Lender shall be under
no further obligation to disburse funds pursuant to this Agreement or the other
Loan Documents.

8.3   Eminent Domain. In the event that any proceeding or action be
commenced for the taking of the Subdivision or any material part thereof
or Interest therein, for public or quasi-public use under the power of
eminent domain, by reason of any public improvement or condemnation
proceeding, or in any other manner (any of the foregoing being a
"Condemnation Event"), or should Borrower receive any notice or other
information regarding such Condemnation Event, Borrower shall give
prompt written notice thereof to Lender. Upon the occurrence of a
Condemnation Event, Lender shall be entitled by written notice to
Borrower to terminate its obligation to make further disbursements of the
Loan and to declare all outstanding indebtedness under the Loan to be
immediately due and payable. Lender shall be entitled at its option,
without regard to the adequacy of its security, to appear in and prosecute
in its own name any action or proceeding relating to the Condemnation
Event. Lender shall also be entitled to make any compromise or settlement
in connection with such Condemnation Event. All proceeds of such
Condemnation Event are hereby assigned to Lender and Borrower agrees
to execute such further assignments of the condemnation proceeds as
Lender may require. After deducting therefrom all costs and expenses
(regardless of the particular nature thereof and whether incurred with or
without suit), including, without limitation, reasonable attorneys' fees,
incurred by it in connection with any such action or proceeding, Lender
shall distribute such condemnation proceeds in accordance with the Deed
of Trust.

                                 ARTICLE IX
                        EVENTS OF DEFAULT AND REMEDIES

9.1   Events of Default.

(a)   Upon written notice from Lender to Borrower (except for the
occurrence of any event described in Section 9.1 (a) (i), 9.1 (a)(vi) 
and 9.1(a)(x) through 9.1 (a)(xvii) inclusive, in which event no notice 
shall be required, and, in the case of the events described in   Section 
9.1(a)(ii) and 9.1(a)(iii), the expiration of the cure period provided in 
Section 9.11(b), the occurrence of one or more of the following shall 
constitute an Event of Default under this Agreement:

(i)   failure to pay any interest, principal or other monies due under the Note,
this Agreement or any of the other Loan Documents (exclusive of any monies
to be deposited with Lender pursuant to Section 5.4(b)) within fifteen (115)
calendar days after any such amount is due; 

(ii) failure to comply with, perform or observe any of the obligations of, or 
covenants made by, Borrower in this Agreement or any of the other Loan 
Documents (other than any of the obligations of, or covenants made by, Borrower 
which are included within the scope of Section 9.1 (a)(i) above);

(iii) a material default by Borrower under any material construction contract
(including any general contract) affecting the Subdivision;

(iv)  inability of Borrower to satisfy any condition for the receipt of a
disbursement hereunder, or to resolve the situation to the satisfaction of
Lender, for a period in excess of thirty (30) days after written notice from
Lender;

(v)   if any representation or warranty made by Borrower at the date hereof
or at the date of any disbursement of the Loan shall be materially false or
materially misleading;

(vi)  failure to deposit with Lender in cash, the amount necessary to put the
Loan "in balance" within the time period specified in Section 5.4(b),

(vii) any Governmental Authorities take or institute action, which in the
reasonable opinion of Lender, will materially and adversely affect Borrower's
condition, operations, or ability to 
repay the Loan if such action remains effective for more than thirty (30) days;

(viii)    Lender fails to have a legal, valid, binding, and enforceable first 
priority lien acceptable to Lender on all Units, Presold Units, Lots and 
Collateral;

(ix)  work is discontinued for a period of thirty (30) days and Lender has not
excused such discontinuation, or if Lender has excused the discontinuation,
work is not commenced and completed within the period specified by Lender;

(x)    a stop notice affecting the balance of the Loan proceeds is served on
Lender, unless and until a bond in form and substance reasonably satisfactory
to Lender, issued by a surety acceptable to Lender in its reasonable discretion,
is furnished to Lender within the time period specified by Lender;

(xi)  insolvency or a material adverse change in the assets, liabilities or
financial position of Borrower or any Guarantor;

(xii) the commencement by any partner in Borrower of any action or
proceeding which seeks as one of its remedies the dissolution of Borrower or
any partner in Borrower;

(xiii)    if any Governmental Authority, or any court at the instance thereof,
shall assume control over the affairs or operations of, or a receiver or trustee
shall be appointed over or of any substantial part of, or a writ or order of
attachment or garnishment shall be issued or made against any substantial part
of the property of Borrower or any Guarantor;

(xiv) if Borrower or any Guarantor shall admit in writing its inability to pay 
its debts when due, or shall make an assignment for the benefit of creditors;
or Borrower or any Guarantor shall apply for or consent to the appointment
of any receiver, trustee or similar officer for Borrower or any Guarantor,
as the case may be, or for all or any substantial part of their respective
property; Borrower or any Guarantor shall institute (by petition, application,
answer, consent or otherwise) any bankruptcy, insolvency, reorganization,
arrangement, readjustment of debts, dissolution, liquidation, or similar
proceedings relating to Borrower or any Guarantor, as the case may be, or under
the laws of any jurisdiction;

(xv)  if a receiver, trustee or similar officer shall be appointed for Borrower 
or any Guarantor and for all or any substantial part of their respective
property without the application or consent of Borrower or any Guarantor,
as the case may be, and such appointment shall continue undischarged for
a period of thirty (30) days (whether or not consecutive); or any
bankruptcy, insolvency, reorganization, arrangements, readjustment of
debt, dissolution, liquidation or similar proceedings shall be instituted (by
petition, application or otherwise) against Borrower or any Guarantor and
shall remain undismissed for a period of thirty (30) days (whether or not
consecutive);

(xvi) any transfer of the Trust Estate (as defined in the Deed of Trust) or any
portion thereof without the prior written consent of lender or not in
accordance with any provisions of a Deed of Trust regarding the release of
portions of the Trust Estate from such Deed of Trust;

(xvii) the occurrence of a default under (a) that certain promissory note in
the amount of $1,300,000.00 dated as of May 19, 1997 and that certain
additional advance promissory note in the amount of $200,000.00 dated
as of June 10, 1998 secured by the deed of trust executed by WESTCO
COMMUNITY BUILDERS, INC., a California corporation, as trustor,
to North American Title Company, as trustee, in favor of HOUSING
CAPITAL COMPANY, a Minnesota partnership, as beneficiary, dated
May 19, 1997, and recorded June 20, 1997 as Instrument No. 97-074796
in the records of the County Recorder of San Mateo County; and (b) that
certain promissory note in the amount of $900,000.00 dated as of
December 19, 1997 secured by the deed of trust executed by WESTCO
COMMUNITY BUILDERS, INC., a California corporation and DOVER
INVESTMENTS CORPORATION, a Delaware corporation, as trustor,
to First American Title Guaranty Company, as trustee, in favor of
HOUSING CAPITAL COMPANY, a Minnesota partnership, as
Beneficiary, dated December 19, 1997, recorded December 31, 1997 as
Document No. 13997247 in the Records of the County Recorder of Santa
Clara County; (c) that certain promissory note in the amount of
$1,500,000.00 dated as of December 22, 1997 secured by the deed of
trust executed by WESTCO COMMUNITY BUILDERS, INC., a
California corporation and DOVER INVESTMENTS CORPORATION,
a Delaware corporation, as trustor, to First American Title Guaranty
Company, as trustee, in favor of HOUSING CAPITAL COMPANY, a
Minnesota partnership, as Beneficiary, dated December 22, 1997,
recorded December 31, 1997 as Instrument No. 97-173093 in the
Records of the County Recorder of San Mateo County; and (d) that
certain promissory note in the amount of $2,745,000.00 dated March 18,
1998 secured by the deed of trust executed by TRACY RESIDENTIAL
VENTURE PARTNERS, LLC, a California limited liability company,
as trustor, to First American Title Company of Stockton, as trustee; in
favor of Housing Capital Company, a Minnesota partnership, as
Beneficiary, dated March 18, 1998, recorded April 28, 1998 as
Instrument No. 98048795 in the records of the County Recorder of San
Joaquin County;

(xviii)    a default under any future promissory notes which may be executed by
TRACY RESIDENTIAL VENTURE PARTNERS, LLC, a California
limited liability company; and

(xix) the occurrence of any of the events specified in Sections 9.1 (xi), 9.1
(xiv) or 9.1 (xv) of this Agreement with respect to Westco Community
Builders, Inc., or Dover Investments Corporation.

(b)   Only the defaults set forth in Section 9.1 (a)(ii) and 9.1 (a)(iii) are
curable and shall be deemed cured, if:

Borrower commences to cure said default within ten (10) days of receipt of
Lender's notice of default and diligently proceeds to cure the same;
(ii)  Borrower cures such default within ten (10) days after receipt of
Lender's notice or if such default is not reasonably capable of being cured 
within such ten (10) day period, Borrower diligently and continuously proceeds 
to cure such default within such time as Lender, in its sole discretion, 
deems to be reasonable; and

(iii) With respect only to a default under Section 7.21 (a) and 7.21(b).
Borrower delivers to Lender personal guarantees, on Lender's standard guaranty 
form, of all of Borrower's shareholders, guaranteeing the amount of the Loan 
outstanding at that time or with respect to which Lender has an outstanding 
commitment to disburse funds at that time; provided that Lender shall have 
received from the proposed Guarantors their most recent financial statements 
prepared in accordance with GAAP and that Lender shall have approved the 
same in its sole discretion.

(c)   All notice and cure periods provided herein or in any other Loan
Document shall run concurrently with any notice or cure periods provided by 
applicable law.

9.2   Remedies.

(a)   Notwithstanding any provision to the contrary herein or in any of the
other Loan Documents, upon the happening of any Event of Default under this 
Agreement, or upon an Event of Default under any of the other Loan Documents: 
(i) Lenders obligation to make further disbursements of the Loan shall 
cease; (ii) Lender shall, at its option, have the rights and remedies provided 
in the Loan Documents, including, without limitation, the option to declare all
outstanding indebtedness to be immediately due and payable without
presentment, demand, protest or further notice of any kind, lo apply any
of Borrower's funds in its possession to the outstanding indebtedness under
the Note whether or not such indebtedness is then due, and to obtain the
appointment of a receiver, (iii) lender shall have the right to cause an
independent contractor selected by Lender to enter into possession of
the Subdivision and to perform any and all work and labor necessary for the
completion of the Units and Presold Units substantially in accordance with the
Subdivision Plans and Specifications and to perform Borrowers obligations
under this Agreement; (i) Lender may pursue any remedies available
to it pursuant to California Code of Civil Procedure 726.5; and (v) all
outstanding indebtedness under the Loan shall bear interest at the Default
Rate. All sums expended by Lender for such purposes shall be deemed to have
been disbursed to and borrowed by Borrower and shall be secured by the
Deeds of Trust.

(b)   Borrower hereby constitutes and appoints Lender, or an Independent
contractor selected by Lender, as its true and lawful attorney-in-fact with 
full power of substitution to perform Borrowers obligations under this 
Agreement and upon the occurrence of an Event of Default to take all such 
actions as Lenders deems necessary to complete the Units and Presold Units,
including without limitation, any of the following in the name of the
Borrower: (i) to use any of the funds of Borrower, including any balance of
the Loan and any funds which may be held by Lender for Borrower; (ii) to
make such additions, changes and connections in the Subdivision Plans and
Specifications as shall be necessary or desirable to complete the Units and
Presold Units; (iii) to employ any consultants, contractors, subcontractors,
attorneys, agents, architects and inspectors and enter into contracts
required for the completion of the Units and Presold Units; Ov) to pay, settle
or compromise all existing bills and claims which are or may be liens against
the Subdivision or may be necessary or desirable for the completion of the
Units and Presold Units; (v) to execute all applications and certificates
necessary for the completion of the Units and Presold Units; and (vi) to take
such action and require such performance as it deems necessary under any of
the bonds or insurance policies to be furnished hereunder. It is understood and
agreed that the foregoing power of attorney shall be deemed to be a power
coupled with an interest which cannot be revoked until repayment in full
of the Loan.

(c)   The remedies of Lender as provided herein or in any other Loan
Document, or any one or more of them, or at law or equity, shall be cumulative 
and concurrent, and may be pursued singly, successively or together at the 
sole discretion of Lender, and may be exercised as often as occasion thereof 
shall occur.

                                 ARTICLE X
                               MISCELLANEOUS

10.1  Assignment. Borrower shall not assign any of its rights under this
Agreement.

10.2 Notices. Whenever Borrower or Lender shall desire to give or serve any
notice, demand, request or other communication with respect to this
Agreement or any Loan Document, each such notice, demand, request or
communication shall be given in writing (at the address set forth below)
by any of the following means; (a) personal service (including service by
overnight courier service); (b) electronic communication, whether by
telex, telegram or telecopying (if confirmed in writing sent by personal
service or by registered or certified, first class mail, return receipt 
requested); or (c) registered or certified first class mail, return receipt 
requested. Such addresses may be changed by notice to the other party given 
in the same manner as provided above. Any notice, demand or request sent 
pursuant to either subsection (a) or (b) hereof shall be deemed received upon 
such personal service or upon dispatch by electronic means, and, if sent 
pursuant to subsection (c) shall be deemed received five (5) days following 
deposit in the mail.

To Lender:                Housing Capital Company
                          1825 South Grant Street, Suite 630
                          San Mateo, CA 94402

To Borrower:              Tracy Residential Venture Partners, LLC
                          Attn: Jerry Finch
                          15225 Wicks Boulevard
                          San Leandro, CA 94577

10.3 Authority to File Notices. Borrower irrevocably appoints Lender as its
Attorney-in-fact, with full power of substitution, to file for record, at the
Borrower's cost and expense and in Borrower's name, any notices of
completion, notices of cessation of labor, or any other notices that Lender
considers necessary or desirable to protect its security.

10.4 No Waiver. No disbursement of proceeds of the Loan shall constitute a
waiver of any conditions to Lender's obligation to make further
disbursements nor, in the event Borrower is unable to satisfy any such
conditions, nor shall any such water have the effect of precluding Lender
from thereafter declaring such inability to constitute a default under this
Agreement.

10.5 Lender Approval of Instruments and Parties. All proceedings taken in
accordance with transactions provided for herein; an waivers of lien,
surveys, appraisals and documents required or contemplated by this
Agreement and the persons responsible for the execution and preparation
thereof; and the form of the general contracts, subcontracts, all leases,
bonds and guaranties shall be reasonably satisfactory to and subject to
reasonable approval by Lender.

10.6 Incorporation of Preamble, Recital, Riders and Exhibits. The
preamble, recital, riders and exhibits hereto are hereby incorporated
into this Agreement and made a part hereof.

10.7 Third-Party Consultants. Lender may hire such third-party consultants
as it deems necessary, the reasonable costs of which shall be paid by
Borrower, to provide the following services: (a) review Subdivision Plans
and Specifications; (b) review Subdivision Budgets, Unit Budgets and
Construction Schedules; (c) conduct compliance inspections with respect
to the progress of construction of the Units and Presold Units and approve
each element of a request for disbursement relating to construction costs;
and (d) perform such other services or provide such other advice as may,
from time to time, be required by Lender.

10.8 Payment of Expenses. Borrower shall pay prior to when due all taxes and
assessments and all expenses, charges, costs and fees provided for in this
Agreement or relating to the Loan or construction of the Units and
Presold Units, including all fees, charges, and taxes in connection with
recording or filing any of the Loan Documents, title insurance premiums
and charges, fees of any consultants, fees and costs of Lender's counsel
(which attorneys may include employees of Lender), printing and
duplicating expenses, air freight charges, escrow fees, costs of surveys,
premiums of hazard insurance policies and surety bonds, fees for any
architectural or engineering review, environmental audits, appraisal,
market or feasibility study required by Lender and all other costs incurred
by Lender in connection with the Loan. All such expenses, charges, costs
and fees shall be Borrower's obligation regardless of whether or not
Borrower has requested and met the conditions for a disbursement of the
Loan. This obligation on the part of Borrower shall survive the closing of
the Loan and the repayment thereof. Borrower hereby authorizes Lender,
in its discretion, to pay such expenses, charges, costs and fees at any time
by a disbursement of the Loan.

10.9 Disclaimer by Lender. Lender shall not be liable to any contractor,
subcontractor, supplier, laborer, architect, engineer or any other party for
services performed or materials supplied in connection with the
Subdivision or the construction of any Unit or Presold Unit. Lender shall
not be liable for any debts or claims accruing in favor of any such parties
against Borrower or others or against the Subdivision. Borrower is not
and shall not be an agent of Lender for any purpose. Lender is not a joint
venture partner with Borrower or with the constituent partners of
Borrower in any manner whatsoever. No payment by Lender of funds
directly to a contractor, subcontractor, or provider of services shall be
deemed to create any third party beneficiary status or recognition of same
by Lender. Approvals granted by Lender for any matters covered under
this Agreement shall be narrowly construed to cover only the parties and
facts identified in any written approval or, if not in writing, such
approvals shall be solely for the benefit of Borrower.

10.10 Indemnification. To the fullest extent permitted by law, Borrower agrees
to protect, indemnify, defend and hold harmless Lender, its directors,
officers, agents and employees from and against any and all liability,
expense, loss or damage of any kind or nature and from any suits, claims
or demands, including reasonable attorneys fees and costs, on account of
any matter or thing or action or failure to act by Lender, whether in suit
or not, arising out of this Agreement or in connection herewith, unless
such suit, claim or demand is caused solely by any act, omission or willful
malfeasance of Lender, its directors, officers, agents and employees.
Upon receiving knowledge of any suit, claim or demand asserted by a
third party that Lender believes is covered by this Indemnity, 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. Lender may also require Borrower to so defend the matter. This
obligation on the part of Borrower shall survive the closing of the Loan
and the repayment thereof.

10.11 Inconsistences with Loan Documents. In the event it is impossible to
simultaneously comply with the terms of this Agreement and any of the
terms of any other Loan Document, the terms of this Agreement shall
govern and prevail over the inconsistent term of the other Loan Document

10. 12 Titles and Headings. The titles and headings of sections of this
Agreement are intended for convenience only and shall not in any way
affect the meaning or construction of any provision of this Agreement.

10.13 Changes, Waivers, Discharge and Modifications in Writing. No
provision of this Agreement may be changed, waived, discharged or
terminated except by an Instrument in writing signed by the party against
whom enforcement of the change, waiver, discharge or termination is
sought.

10.14 Erection of Sign. At Lender's election, Borrower shall erect a sign on the
Subdivision satisfactory to Lender in a conspicuous location indicating
that the construction financing has been arranged through and supplied by
Lender, which sign shall comply with all applicable zoning ordinances
and restrictive covenants. Borrower shall not erect any sign identifying
Lender in connection with the Subdivision or otherwise identify Lender
in any marketing materials or advertisements without the prior written
consent of Lender.

10.15 Choice of Law. THIS AGREEMENT AND THE TRANSACTION CONTEMPLATED HEREUNDER 
SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE
STATE OF CALIFORNIA.

10.10 Advances in Excess of Loan Amounts. In the event the total
disbursements by Lender exceed the Maximum Facility Commitment
Amount, to the extent permitted by the laws of the State of California, the
total of all disbursements shall be secured by the Deed of Trust. All other
sums expended by Lender pursuant to this Agreement or any other Loan
Document shall be deemed to have been paid to Borrower and shall be
secured by, among other things, the Deed of Trust.

10.17 Participation. Lender shall have the right at any time to sell, assign or
transfer the Loan or the Note or to sell or grant participation in all or any
part therein, all without notice to or the consent of Borrower. Borrower
hereby acknowledges and agrees that any such disposition will give rise
to a direct obligation of Borrower to each holder of the Note or the Loan
or each participant or assignee of all or any part of the Loan or Note. 
Lender may disclose to third parties, including without limitation, 
prospective purchasers of the Loan or participation interests therein,
financial or other information in Lender's possession regarding Borrower 
or the Property.

10.18 Counterparts. This Agreement may be executed in any number of
counterparts each of which shall be deemed an original and all of which
shall constitute one and the same agreement with the same effect as if all
parties had signed the same signature page. Any signature page of this
Agreement may be detached from any counterpart of this Agreement and
reattached to any other counterpart of this Agreement identical in form
hereto but having attached to it one or more additional signature pages.

10.19 Time is of the Essence. Time is strictly of the essence of this
Agreement.

10.20 Completion of Construction. For purposes of subdivision (6) of Section
9313 of the California Commercial Code, "completion of construction"
shall not be deemed to occur prior to completion of all work, and
installation or incorporation into the Units and Presold Units of all
materials, for which Loan proceeds are disbursed by Lender.

10.21 Submission of Agreement. The submission of this Agreement to
Borrower or its agent or attorney for review or signature does not
constitute a commitment by Lender to make the Loan to Borrower, and
this Agreement shall have no binding force or effect until its execution
and delivery by both Borrower and Lender.

10.22 Attorneys' Fees. For the purpose of this Agreement and the other Loan
Documents, the terms "attorneys' fees" or "attorneys' fees and costs" shall
mean the reasonable fees and expenses of counsel to the parties hereto
(including, without limitation, in-house counsel employed by Lender),
which may include printing, duplicating and other expenses, air freight
charges, and fees billed for law clerks and paralegal. The terms "attorneys'
fees" or "attorneys' fees and costs" shall also include, without limitation,
all such fees and expenses incurred with respect to appeals, arbitrations
and bankruptcy proceedings, and whether or not any action or proceeding
is brought with respect to the manner for which said fees and expenses
were incurred.

10.23 Entire Agreement. This Agreement and the Loan Documents constitute
the entire agreement and understanding of Lender and Borrower with
respect to the matters set forth herein and therein. No representation,
warranty, covenant, promise, understanding or condition shall be
enforceable against any party unless it is contained in this Agreement or
the Loan Document

10.24 Severability. The invalidity or unenforceability of any one or more
provisions of this Agreement or any Loan Document shall not affect
the validity or enforce ability of any other provision.
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In witness hereof, Borrower and  lender have caused this Agreement to be
executed and delivered as of the date first above written.

"Lender"
HOUSING CAPITAL COMPANY,
a Minnesota Partnership

BY:   DFP Financial Inc., a California
      corporation, Its: Managing
      General Partner


"Borrower"
TRACY RESIDENTIAL VENTURE PARTNERS, 
LLC, a California limited liability company

BY: WESTCO COMMUNITY BUILDERS, 
INC., a California corporation Member 
Glen Britton Evans, Jr.
 Its: Executive Vice President
 By: Jerry A. Finch
 Its: President
BY: DOVER INVESTMENTS CORP., a
Delaware corporation Member
By:  Lawrence Weissberg
Its:   President









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