<PAGE>
                                                                     Exhibit 4.1

                            LNR PROPERTY CORPORATION

                                    as Issuer

                                       and

                      U.S. BANK TRUST NATIONAL ASSOCIATION

                                   as Trustee

                                    INDENTURE

                          Dated as of October 29, 2003

               7.25% SENIOR SUBORDINATED NOTES DUE 2013, SERIES A

               7.25% SENIOR SUBORDINATED NOTES DUE 2013, SERIES B
<PAGE>
                              CROSS REFERENCE TABLE

<TABLE>
<CAPTION>
TIA Section                                                                   Indenture Section
-----------                                                                   -----------------
<S>                                                                           <C>
310(a)(1).................................................................        7.10
      (a)(2)..............................................................        7.10
      (a)(3)..............................................................        N.A.
      (a)(4)..............................................................        N.A.
      (a)(5)..............................................................        7.10
      (b).................................................................        7.8; 7.10; 11.2
      (c).................................................................        N.A.
311(a)....................................................................        7.11
      ((b)................................................................        7.11
      (c).................................................................        N.A.
312(a)....................................................................        2.5
      (b).................................................................        11.3
      (c).................................................................        11.3
313(a)....................................................................        7.6
      (b)(1)..............................................................        N.A.
      (b)(2)..............................................................        7.6
      (c).................................................................        7.6; 11.2
      (d).................................................................        7.6
314(a)....................................................................        4.6; 4.8; 11.2
      (b).................................................................        N.A.
      (c)(1)..............................................................        7.2; 11.4
      (c)(2)..............................................................        7.2; 11.4
      (c)(3)..............................................................        N.A.
      (d).................................................................        N.A.
      (e).................................................................        11.5
      (f).................................................................        N.A.
315(a)....................................................................        7.1(b)
      (b).................................................................        7.5; 11.2
      (c).................................................................        7.1(a)
      (d).................................................................        6.5; 7.1(c)
      (e).................................................................        6.11
316(last sentence)........................................................        2.9
      (a)(1)(A)...........................................................        6.5
      (a)(1)(B)...........................................................        6.4
      (a)(2)..............................................................        N.A.
      (b).................................................................        6.7
      (c).................................................................        9.4
317(a)(1).................................................................        6.8
      (a)(2)..............................................................        6.9
      (b).................................................................        2.4
318(a)....................................................................        11.1
      (c).................................................................        11.1
</TABLE>


-------------------
N.A. means Not Applicable.

Note:    This cross-reference table shall not, for any purpose, be deemed to be
         a part of the Indenture.

                                      (i)
<PAGE>
                                TABLE OF CONTENTS

                       ARTICLE I. DEFINITIONS AND INCORPORATION BY REFERENCE

<TABLE>
<S>                <C>                                                                                      <C>
SECTION 1.1.       Definitions...........................................................................    1

SECTION 1.2.       Incorporation by Reference of TIA.....................................................   19

SECTION 1.3.       Rules of Construction.................................................................   20


                       ARTICLE II. THE NOTES

SECTION 2.1.       Form and Dating.......................................................................   20

SECTION 2.2.       Execution and Authentication; Aggregate Principal Amount..............................   21

SECTION 2.3.       Registrar and Paying Agent............................................................   22

SECTION 2.4.       Paying Agent to Hold Assets in Trust..................................................   22

SECTION 2.5.       Holder Lists..........................................................................   22

SECTION 2.6.       Transfer and Exchange.................................................................   23

SECTION 2.7.       Replacement Notes.....................................................................   23

SECTION 2.8.       Outstanding Notes.....................................................................   24

SECTION 2.9.       Treasury Notes........................................................................   24

SECTION 2.10.      Temporary Notes.......................................................................   24

SECTION 2.11.      Cancellation..........................................................................   24

SECTION 2.12.      Defaulted Interest....................................................................   25

SECTION 2.13.      CUSIP Number..........................................................................   25

SECTION 2.14.      Deposit of Monies.....................................................................   26

SECTION 2.15.      Restrictive Legends...................................................................   26

SECTION 2.16.      Book-Entry Provisions for Global Security.............................................   26

SECTION 2.17.      Special Transfer Provisions...........................................................   27

SECTION 2.18.      Additional Interest Under Registration Rights Agreement...............................   30

</TABLE>

                                      (ii)
<PAGE>
<TABLE>
<S>                <C>                                                                                      <C>
                       ARTICLE III. REDEMPTION

SECTION 3.1.       Notices to Trustee....................................................................   30

SECTION 3.2.       Selection of Notes To Be Redeemed.....................................................   30

SECTION 3.3.       Optional Redemption...................................................................   31

SECTION 3.4.       Notice of Redemption..................................................................   31

SECTION 3.5.       Effect of Notice Defect...............................................................   32

SECTION 3.6.       Deposit of Redemption Price...........................................................   32

SECTION 3.7.       Notes Redeemed in Part................................................................   33


                      ARTICLE IV. COVENANTS

SECTION 4.1.       Payment of Notes......................................................................   33

SECTION 4.2.       Maintenance of Office or Agency.......................................................   33

SECTION 4.3.       Corporate Existence...................................................................   33

SECTION 4.4.       Payment of Taxes and Other Claims.....................................................   34

SECTION 4.5.       Maintenance of Properties and Insurance...............................................   34

SECTION 4.6.       Compliance Certificate; Notice of Default.............................................   34

SECTION 4.7.       Compliance with Laws..................................................................   35

SECTION 4.8.       Commission Reports....................................................................   35

SECTION 4.9.       Waiver of Stay, Extension or Usury Laws...............................................   36

SECTION 4.10.      Limitation on Restricted Payments.....................................................   36

SECTION 4.11.      Limitation on Transactions with Affiliates............................................   38

SECTION 4.12.      Limitation on Incurrence of Additional Indebtedness...................................   40

SECTION 4.13.      Limitation on Dividend and Other Payment Restrictions Affecting Subsidiaries..........   41

SECTION 4.14.      Change of Control.....................................................................   42

SECTION 4.15.      Limitation on Preferred Stock of Subsidiaries.........................................   43

SECTION 4.16.      Limitation on Liens and Guarantees....................................................   43

SECTION 4.17.      Conduct of Business...................................................................   44
</TABLE>

                                     (iii)
<PAGE>
<TABLE>
<S>                <C>                                                                                      <C>
SECTION 4.18.      Prohibition on Incurrence of Senior Subordinated Debt.................................   44


                       ARTICLE V. SUCCESSOR CORPORATION

SECTION 5.1.       Merger, Consolidation and Sale of Assets..............................................   44

SECTION 5.2.       Successor Corporation Substituted.....................................................   45


                       ARTICLE VI. REMEDIES

SECTION 6.1.       Events of Default.....................................................................   46

SECTION 6.2.       Acceleration..........................................................................   47

SECTION 6.3.       Other Remedies........................................................................   48

SECTION 6.4.       Waiver of Past Defaults...............................................................   48

SECTION 6.5.       Control by Majority...................................................................   48

SECTION 6.6.       Limitation on Suits...................................................................   49

SECTION 6.7.       Right of Holders To Receive Payment...................................................   49

SECTION 6.8.       Collection Suit by Trustee............................................................   49

SECTION 6.9.       Trustee May File Proofs of Claim......................................................   49

SECTION 6.10.      Priorities............................................................................   50

SECTION 6.11.      Undertaking for Costs.................................................................   50

SECTION 6.12.      Restoration of Rights and Remedies....................................................   51


                       ARTICLE VII. TRUSTEE

SECTION 7.1.       Duties of Trustee.....................................................................   51

SECTION 7.2.       Rights of Trustee.....................................................................   52

SECTION 7.3.       Individual Rights of Trustee..........................................................   53

SECTION 7.4.       Trustee's Disclaimer..................................................................   53

SECTION 7.5.       Notice of Default.....................................................................   53

SECTION 7.6.       Reports by Trustee to Holders.........................................................   54

SECTION 7.7.       Compensation and Indemnity............................................................   54
</TABLE>

                                      (iv)
<PAGE>
<TABLE>
<S>                <C>                                                                                      <C>
SECTION 7.8.       Replacement of Trustee................................................................   55

SECTION 7.9.       Successor Trustee by Merger, Etc......................................................   56

SECTION 7.10.      Eligibility; Disqualification.........................................................   56

SECTION 7.11.      Preferential Collection of Claims Against LNR.........................................   56


                       ARTICLE VIII. DISCHARGE OF INDENTURE; DEFEASANCE

SECTION 8.1.       Termination of Obligations............................................................   56

SECTION 8.2.       Application of Trust Money............................................................   59

SECTION 8.3.       Repayment.............................................................................   59

SECTION 8.4.       Reinstatement.........................................................................   59

SECTION 8.5.       Acknowledgment of Discharge by Trustee................................................   60


                       ARTICLE IX. MODIFICATION OF THE INDENTURE

SECTION 9.1.       Without Consent of Holders............................................................   60

SECTION 9.2.       With Consent of Holders...............................................................   60

SECTION 9.3.       Compliance with TIA...................................................................   61

SECTION 9.4.       Revocation and Effect of Consents.....................................................   61

SECTION 9.5.       Notation on or Exchange of Notes......................................................   62

SECTION 9.6.       Trustee To Sign Amendments, Etc.......................................................   62


                       ARTICLE X. SUBORDINATION

SECTION 10.1.      Notes Subordinated to Senior Indebtedness.............................................   62

SECTION 10.2.      Suspension of Payment When Senior Indebtedness is in Default..........................   63

SECTION 10.3.      Notes Subordinated to Prior Payment of All Senior Indebtedness
                   on Dissolution, Liquidation or Reorganization. .......................................   64

SECTION 10.4.      Holders To Be Subrogated to Rights of Holders of Senior Indebtedness..................   65

SECTION 10.5.      Obligations of LNR Unconditional......................................................   65
</TABLE>

                                      (v)
<PAGE>
<TABLE>
<S>                <C>                                                                                      <C>
SECTION 10.6.      Trustee Entitled To Assume Payments Not Prohibited in Absence of Notice...............   66

SECTION 10.7.      Application by Trustee of Assets Deposited with It....................................   67

SECTION 10.8.      No Waiver of Subordination Provisions.................................................   67

SECTION 10.9.      Holders Authorize Trustee To Effectuate Subordination of Notes........................   67

SECTION 10.10.     Right of Trustee To Hold Senior Indebtedness..........................................   68

SECTION 10.11.     Subordination Not To Prevent Events of Default........................................   68

SECTION 10.12.     No Fiduciary Duty of Trustee to Holders of Senior Indebtedness........................   68


                       ARTICLE XI. MISCELLANEOUS

SECTION 11.1.      TIA Controls..........................................................................   69

SECTION 11.2.      Notices...............................................................................   69

SECTION 11.3.      Communications by Holders with Other Holders..........................................   70

SECTION 11.4.      Certificate and Opinion as to Conditions Precedent....................................   70

SECTION 11.5.      Statements Required in Certificate or Opinion.........................................   70

SECTION 11.6.      Rules by Trustee, Paying Agent, Registrar.............................................   71

SECTION 11.7.      Legal Holidays........................................................................   71

SECTION 11.8.      Governing Law.........................................................................   71

SECTION 11.9.      No Adverse Interpretation of Other Agreements.........................................   71

SECTION 11.10.     No Personal Liability.................................................................   71

SECTION 11.11.     Successors............................................................................   71

SECTION 11.12.     Duplicate Originals...................................................................   71

SECTION 11.13.     Severability..........................................................................   72
</TABLE>

                                      (iv)
<PAGE>
         INDENTURE, dated as of October 29, 2003, between LNR PROPERTY
CORPORATION, a Delaware corporation ("LNR"), and U.S. BANK TRUST NATIONAL
ASSOCIATION, as Trustee (the "TRUSTEE").

         LNR has duly authorized the creation of an issue of its 7.25% Senior
Subordinated Notes due 2013, Series A, and its 7.25% Senior Subordinated Notes
due 2013, Series B, to be issued in exchange for the 7.25% Senior Subordinated
Notes due 2013, Series A, pursuant to the Registration Rights Agreement (as
defined herein) and, to provide therefor, LNR has duly authorized the execution
and delivery of this Indenture. All things necessary to make the Notes (as
defined), when duly issued and executed by LNR, and authenticated and delivered
hereunder, the valid obligations of LNR, and to make this Indenture a valid and
binding agreement of LNR, have been done.

         Each party hereto agrees as follows for the benefit of the other
parties and for the equal and ratable benefit of the Holders (as defined) of
LNR's 7.25% Senior Subordinated Notes due 2013, Series A and Series B.

                                   ARTICLE I.

                   DEFINITIONS AND INCORPORATION BY REFERENCE

SECTION 1.1 Definitions.

         "ACQUIRED INDEBTEDNESS" means Indebtedness of a Person or any of its
Subsidiaries existing at the time such Person becomes a Subsidiary of LNR or at
the time it merges or consolidates with or into LNR or any of its Subsidiaries
or assumed by LNR or any of its Subsidiaries in connection with the acquisition
of assets from such Person, and in each case not incurred by such Person or any
of its Subsidiaries in connection with, or in anticipation or contemplation of,
such Person becoming a Subsidiary of LNR or such acquisition, merger or
consolidation.

         "ADDITIONAL PARTNERSHIP TRANSACTIONS" means transactions entered into
in accordance with LNR's By-Laws as in effect on the Issue Date with an entity
other than Lennar Land Partners, Lennar Land Partners II or NWHL Investment LLC
that is equally owned by LNR and Lennar Corporation (both economically and by
voting control) and has been organized and is then existing (i) for the primary
purpose of acquiring, holding or disposing of land that may be purchased by LNR
or any of LNR's Subsidiaries and/or Lennar Corporation or any of its
Subsidiaries; and (ii) on terms substantially the same as those contained in the
partnership agreement of either Land Partnership (including provisions in such
partnership agreement regarding transactions with LNR), as in effect on the
Issue Date.

         "ADJUSTED CONSOLIDATED EBITDA" means, with respect to any Person for
any period, the sum of Consolidated EBITDA PLUS any non-refundable housing tax
credits used by such Person and its Consolidated Subsidiaries to reduce the
amount of income taxes that would have been otherwise been payable by such
Person and its Consolidated Subsidiaries for such period.

                                      -1-
<PAGE>
         "ADDITIONAL INTEREST" shall have the meaning set forth in the
Registration Rights Agreement.

         "AFFILIATE" means, with respect to any specified Person, any other
Person who directly or indirectly through one or more intermediaries controls,
or is controlled by, or is under common control with, such specified Person. The
term "control" means the possession, directly or indirectly, of the power to
direct or cause the direction of the management and policies of a Person,
whether through the ownership of voting securities, by contract or otherwise;
and the terms "controlling" and "controlled" have meanings correlative of the
foregoing.

         "AFFILIATE TRANSACTION" has the meaning provided in SECTION 4.11.

         "AGENT" means any Registrar, Paying Agent or co-Registrar.

         "AGENT MEMBERS" has the meaning provided in SECTION 2.16.

         "ASSET ACQUISITION" means (a) an Investment by LNR or any Subsidiary of
LNR in any other Person pursuant to which such Person shall become a Subsidiary
of LNR, or shall be merged or consolidated with or into LNR or any Subsidiary of
LNR, or (b) the acquisition by LNR or any Subsidiary of LNR of the assets of any
Person (other than a Subsidiary of LNR) which constitute all or substantially
all of the assets of such Person or comprise any division or line of business of
such Person or any other properties or assets of such Person other than in the
ordinary course of business.

         "ASSET SALE" means any direct or indirect sale, issuance, conveyance,
transfer, lease (other than operating leases entered into in the ordinary course
of business), assignment or other transfer for value by LNR or any of its
Subsidiaries (including any sale and leaseback transaction) to any Person other
than LNR or a Wholly Owned Subsidiary of LNR of (a) any Capital Stock of any
Subsidiary of LNR, or (b) any other property or assets of LNR or any Subsidiary
of LNR other than in the ordinary course of business (treating the sales of
commercial and multi-family residential real estate as being in the ordinary
course of business).

         "AUTHENTICATING AGENT" has the meaning provided in SECTION 2.2.

         "BANKRUPTCY LAW" means Title 11, U.S. Code or any similar federal,
state or foreign law for the relief of debtors.

         "BASE DATE" means March 24, 1998.

         "BASE DATE INDENTURE" means the Indenture, dated as of March 24, 1998,
between LNR and U.S. Bank Trust National Association (formerly named First Trust
of New York, National Association).

         "BLOCKAGE PERIOD" has the meaning provided in SECTION 10.2.

         "BOARD OF DIRECTORS" means, as to any Person, the board of directors of
such Person or any duly authorized committee thereof.

                                      -2-
<PAGE>
         "BOARD RESOLUTION" means, with respect to any Person, a copy of a
resolution certified by the Secretary or an Assistant Secretary of such Person
to have been duly adopted by the Board of Directors of such Person and to be in
full force and effect on the date of such certification, and delivered to the
Trustee.

         "BUSINESS DAY" means any day other than a Saturday, Sunday or any other
day on which banking institutions in the City of New York are required or
authorized by law or other governmental action to be closed.

         "CAPITALIZED LEASE OBLIGATION" means, as to any Person, the obligations
of such Person under a lease that are required to be classified and accounted
for as capital lease obligations under GAAP and, for purposes of this
definition, the amount of such obligations at any date shall be the capitalized
amount of such obligations at such date, determined in accordance with GAAP.

         "CAPITAL STOCK" means (i) with respect to any Person that is a
corporation, any and all shares, interests, participations or other equivalents
(however designated and whether voting or nonvoting) of corporate stock,
including each class of Common Stock and Preferred Stock of such Person and (ii)
with respect to any Person that is not a corporation, any and all partnership or
other equity interests of such Person.

         "CASH EQUIVALENTS" means (i) marketable direct obligations issued by,
or unconditionally guaranteed by, the United States Government or issued by any
agency thereof and backed by the full faith and credit of the United States, in
each case maturing within one year from the date of acquisition thereof; (ii)
marketable direct obligations issued by any state of the United States of
America or any political subdivision of any such state or any public
instrumentality thereof maturing within one year from the date of acquisition
thereof and, at the time of acquisition, having one of the two highest ratings
obtainable from either Standard & Poor's ("S&P") or Moody's Investors Service,
Inc. ("MOODY'S"); (iii) commercial paper maturing no more than one year from the
date of creation thereof and, at the time of acquisition, having a rating of at
least A-1 from S&P or at least P-1 from Moody's; (iv) certificates of deposit or
bankers' acceptances maturing within one year from the date of acquisition
thereof issued by any bank organized under the laws of the United States of
America or any state thereof or the District of Columbia or any U.S. branch of a
foreign bank having at the date of acquisition thereof combined capital and
surplus of not less than $250,000,000; (v) repurchase obligations with a term of
not more than seven days for underlying securities of the types described in
clause (i) above entered into with any bank meeting the qualifications specified
in clause (iv) above; and (vi) money market funds which invest substantially all
their assets in securities of the types described in clauses (i) through (v)
above.

         "CHANGE OF CONTROL" means the occurrence of one or more of the
following events:

         (i) any person (including any syndicate or group deemed to be a
"person" under Section 13(d)(3) of the Exchange Act, other than LNR, any
Subsidiary of LNR, any employee benefit plan of LNR or any Subsidiary of LNR, or
a Permitted Holder is or becomes the "beneficial owner" (determined in
accordance with Rules 13d-3 and 13d-5 under the Exchange Act or any successor
person, except that a person shall be deemed to have "beneficial ownership" of
all shares

                                      -3-
<PAGE>
of Capital Stock of LNR that the person has the right to acquire, whether
exercisable immediately or only after the passage of time), directly or
indirectly, through a purchase or other acquisition transaction or series of
transactions (other than a merger or consolidation involving LNR), of shares of
the Capital Stock of LNR entitling such person to exercise in excess of 50% of
the total voting power of all shares of the Capital Stock of LNR entitled to
vote generally in the election of directors;

         (ii) LNR consolidates with, or merges into, any other Person, any
Person consolidates with, or merges into LNR, or LNR sells or transfers its
assets, as an entirety or substantially as an entirety, to another Person, other
than:

                  (a) any such merger pursuant to which the holders of the
         Capital Stock of LNR entitled to vote generally in the election of
         directors, immediately prior to such transaction, have, directly or
         indirectly, shares of Capital Stock of the continuing or surviving
         corporation immediately after such transaction which entitle such
         holders to exercise in excess of 50% of the total voting power of all
         shares of Capital Stock of the continuing or surviving corporation or
         its parent entitled to vote generally in the election of directors; and

                  (b) any merger which is effected solely to change the
         jurisdiction of incorporation of LNR and results in a reclassification,
         conversion or exchange of outstanding shares of Capital Stock of LNR
         entitled to vote generally in the election of directors solely into
         shares of Capital Stock carrying substantially the same relative rights
         as such Capital Stock of LNR; or

         (iii) a change in the Board of Directors of LNR in which the
individuals who constituted the Board of Directors of LNR at the beginning of
the two-year period immediately preceding such change (together with any other
director whose election to the Board of Directors of LNR or whose nomination for
election by the stockholders of LNR was approved by a vote of at least a
majority of the directors then in office either who were directors at the
beginning of such period or whose election or nomination for election was
previously so approved) cease for any reason to constitute a majority of the
directors then in office.

         "CHANGE OF CONTROL OFFER" has the meaning provided in SECTION 4.14.

         "CHANGE OF CONTROL PAYMENT DATE" has the meaning provided in SECTION
4.14.

         "COMMISSION" means the Securities and Exchange Commission.

         "COMMON STOCK" means, with respect to any Person, any and all shares,
interests or other participations in, and other equivalents (however designated
and whether voting or nonvoting) of such Person's common stock, whether
outstanding on the Issue Date or issued after the Issue Date, and includes,
without limitation, all series and classes of such common stock.


         "CONSOLIDATED EBITDA" means, with respect to any Person for any period,
the sum (without duplication) of (i) Consolidated Net Income and (ii) to the
extent Consolidated Net Income has been reduced thereby, (A) all income taxes of
such Person and its Subsidiaries paid or accrued in accordance with GAAP for
such period (other than income taxes attributable to

                                      -4-
<PAGE>
extraordinary, unusual or nonrecurring gains or losses or taxes attributable to
sales or dispositions outside the ordinary course of business), (B) Consolidated
Interest Expense and (C) Consolidated Non-cash Charges LESS any non-cash items
increasing Consolidated Net Income for such period, all as determined on a
consolidated basis for such Person and its Subsidiaries in accordance with GAAP.

         "CONSOLIDATED FIXED CHARGE COVERAGE RATIO" means, with respect to any
Person, the ratio of Adjusted Consolidated EBITDA of such Person during the four
full fiscal quarters (the "FOUR QUARTER PERIOD") ending on or prior to the date
of the transaction giving rise to the need to calculate the Consolidated Fixed
Charge Coverage Ratio (the "TRANSACTION DATE") to Consolidated Fixed Charges of
such Person for the Four Quarter Period. In addition to and without limitation
of the foregoing, for purposes of this definition, "Consolidated EBITDA" and
"Consolidated Fixed Charges" shall be calculated after giving effect on a pro
forma basis for the period of such calculation to:

         (i) the incurrence or repayment or Refinancing of any Indebtedness of
such Person or any of its Subsidiaries (and the application of the proceeds
thereof) giving rise to the need to make such calculation and any incurrence or
repayment or Refinancing of other Indebtedness (and the application of the
proceeds thereof), other than the incurrence or repayment of Indebtedness in the
ordinary course of business for working capital purposes pursuant to working
capital facilities, occurring during the Four Quarter Period or at any time
subsequent to the last day of the Four Quarter Period and on or prior to the
Transaction Date, as if such incurrence or repayment or Refinancing as the case
may be (and the application of the proceeds thereof), occurred on the first day
of the Four Quarter Period and

         (ii) any Asset Sales or Asset Acquisitions (including, without
limitation, any Asset Acquisition giving rise to the need to make such
calculation as a result of such Person or one of its Subsidiaries (including any
Person who becomes a Subsidiary as a result of the Asset Acquisition) incurring,
assuming or otherwise being liable for Acquired Indebtedness and also including
any Consolidated EBITDA (including any pro forma expense and cost reductions
calculated on a basis consistent with Regulation S-X under the Securities Act as
in effect on the Base Date) (PROVIDED that such Consolidated EBITDA shall be
included only to the extent includible pursuant to the definition of
"Consolidated Net Income") attributable to the assets which are the subject of
the Asset Acquisition or Asset Sale) occurring during the Four Quarter Period or
at any time subsequent to the last day of the Four Quarter Period and on or
prior to the Transaction Date, as if such Asset Sale or Asset Acquisition
(including the incurrence, assumption or liability for any such Acquired
Indebtedness) occurred on the first day of the Four Quarter Period.

If such Person or any of its Subsidiaries directly or indirectly guarantees
Indebtedness of a third Person, the preceding sentence shall give effect to the
incurrence of such guaranteed Indebtedness as if such Person or any Subsidiary
of such Person had directly incurred or otherwise assumed such guaranteed
Indebtedness. Furthermore, in calculating "Consolidated Fixed Charges" for
purposes of determining the denominator (but not the numerator) of this
"Consolidated Fixed Charge Coverage Ratio," (1) interest on outstanding
Indebtedness determined on a fluctuating basis as of the Transaction Date and
which will continue to be so determined thereafter shall be deemed to have
accrued at a fixed rate per annum equal to the rate of interest on such
Indebtedness in effect on the Transaction Date; (2) if interest on any
Indebtedness actually incurred on the Transaction

                                      -5-
<PAGE>
Date may optionally be determined at an interest rate based upon a factor of a
prime or similar rate, a eurocurrency interbank offered rate, or other rates,
then the interest rate in effect on the Transaction Date will be deemed to have
been in effect during the Four Quarter Period; and (3) notwithstanding clause
(1) above, interest on Indebtedness determined on a fluctuating basis, to the
extent such interest is covered by agreements relating to Interest Swap
Obligations shall be deemed to accrue at the rate per annum resulting after
giving effect to the operation of such agreements. Finally, in calculating the
"Consolidated Fixed Charge Coverage Ratio", Indebtedness that has been the
subject of a legal defeasance or covenant defeasance shall be disregarded after
such defeasance becomes effective.

         "CONSOLIDATED FIXED CHARGES" means, with respect to any Person for any
period, the sum, without duplication, of (i) Consolidated Interest Expense, PLUS
(ii) the product of (x) the amount of all dividend payments on any series of
Preferred Stock of such Person (other than dividends paid in Qualified Capital
Stock) paid, accrued or scheduled to be paid or accrued during such period times
(y) a fraction, the numerator of which is one and the denominator of which is
one minus the then current effective consolidated federal, state and local tax
rate of such Person, expressed as a decimal.

         "CONSOLIDATED INTEREST EXPENSE" means, with respect to any Person for
any period, the sum of, without duplication: (i) the aggregate of the interest
expense of such Person and its Subsidiaries for such period determined on a
consolidated basis in accordance with GAAP, including without limitation, (a)
any amortization of debt discount, (b) the net costs under Interest Swap
Obligations , but not including the net costs under Interest Swap Obligations
incurred in transactions entered into for the purpose of hedging against changes
in the value of assets of the Person or its Subsidiaries, (c) all capitalized
interest and (d) the interest portion of any deferred payment obligation; and
(ii) the interest component of Capitalized Lease Obligations paid, accrued
and/or scheduled to be paid or accrued by such Person and its Subsidiaries
during such period as determined on a consolidated basis in accordance with
GAAP, minus amortization or write off of deferred financing costs.

         "CONSOLIDATED NET INCOME" means, with respect to any Person for any
period, the aggregate net income (or loss) of such Person and its Subsidiaries
for such period on a consolidated basis, determined in accordance with GAAP;
PROVIDED, HOWEVER, that there shall be excluded therefrom:

         (1) gains (and losses) on an after-tax effected basis from Asset Sales
or abandonments or reserves relating thereto,

         (2) items classified as extraordinary or nonrecurring gains or losses
on an after tax-effected basis,

         (3) the net income or loss of any Person acquired in a "pooling of
interests" transaction accrued prior to the date it becomes a Subsidiary of the
referent Person or is merged or consolidated with the referent Person or any
Subsidiary of the referent Person,

         (4) the net income (but not loss) of any Subsidiary of the referent
Person to the extent that the declaration of dividends or similar distributions
by that Subsidiary of that income is

                                      -6-
<PAGE>
restricted, directly or indirectly, by operation of the terms of its charter or
constituent documents or any agreement, instrument, judgment, law, order,
statute, rule or governmental regulation, or for any other reason whatsoever,

         (5) the net income or loss of any other Person, other than a
Consolidated Subsidiary of the referent Person, except:

                  (A) to the extent (in the case of net income) of cash
         dividends or distributions paid to the referent Person, or to a Wholly
         Owned Subsidiary of the referent Person (other than a Subsidiary
         described in clause (4) above), by such other Person or

                  (B) that the referent Person's share of any net income or loss
         of such other Person under the equity method of accounting for
         Affiliates shall not be excluded,

         (6) any restoration to income of any contingency reserve of an
extraordinary, nonrecurring or unusual nature, except to the extent that
provision for such reserve was made out of Consolidated Net Income accrued at
any time following the Base Date,

         (7) income or loss attributable to discontinued operations (including,
without limitation, operations disposed of during such period whether or not
such operations were classified as discontinued), but not including revenues,
expenses, gains and losses relating to real estate properties sold or held for
sale, even if they were classified as attributable to discontinued operations
under provisions of Statement of Financial Accounting Standards No. 144 and

         (8) in the case of a successor to the referent Person by consolidation
or merger or as a transferee of the referent Person's assets, any earnings of
the successor prior to such consolidation, merger or transfer of assets.

         "CONSOLIDATED NET WORTH" means, with respect to any Person, the
consolidated stockholders' equity of such Person as of the end of the last
completed fiscal quarter ending on or prior to the date of the transaction
giving rise to the need to calculate Consolidated Net Worth, determined on a
consolidated basis in accordance with GAAP, LESS (without duplication) amounts
attributable to (i) Disqualified Capital Stock of such Person and (ii) interests
in such Person's Consolidated Subsidiaries not owned, directly or indirectly by
such Person.

         "CONSOLIDATED NON-CASH CHARGES" means, with respect to any Person for
any period, the aggregate depreciation, amortization, and other non-cash charges
of such Person and its Subsidiaries reducing Consolidated Net Income of such
Person and its Subsidiaries for such period, determined on a consolidated basis
in accordance with GAAP (excluding any such charges which require an accrual of
or a reserve for cash charges for any future period).

         "CONSOLIDATED SUBSIDIARY" means, with respect to any Person, a
Subsidiary of such Person, the financial statements of which subsidiary are
consolidated with the financial statements of such Person in accordance with
GAAP.

         "CONSOLIDATION" means, with respect to any Person, the consolidation of
the accounts of the Subsidiaries of such Person with those of such Person, all
in accordance with GAAP. The term "consolidated" has a correlative meaning to
the foregoing.

                                      -7-
<PAGE>
         "CORPORATE TRUST OFFICE" means the office of the Trustee at which at
any particular time its corporate trust business shall be principally
administered, which office at the date of execution of this Indenture is located
at 100 Wall Street, Suite 1600, New York, New York 10005.

         "COVENANT DEFEASANCE" has the meaning provided in SECTION 8.1.

         "CREDIT AGREEMENT" means the Third Amended and Restated Revolving
Credit Agreement, dated as of November 27, 2002, among LNR and certain
Subsidiaries of LNR, the lenders named therein and Bank of America, N.A., as
administrative agent, together with the related documents thereto (including,
without limitation, any guarantee agreements and security documents), in each
case as such agreement may be amended (including any amendment and restatement
thereof), supplemented or otherwise modified from time to time, including any
agreement extending the maturity of, refinancing, replacing or otherwise
restructuring (including increasing the amount of available borrowings
thereunder (PROVIDED, HOWEVER, that such increase in borrowings is permitted by
SECTION 4.12 other than as Permitted Indebtedness) or adding Subsidiaries of LNR
as additional borrowers or guarantors thereunder) all or any portion of the
Indebtedness under such agreement or any successor or replacement agreement and
whether by the same or any other agent, lender or group of lenders.

         "CURRENCY AGREEMENT" means any foreign exchange contract, currency swap
agreement or other similar agreement or arrangement designed to protect LNR or
any Subsidiary of LNR against fluctuations in currency values. "CUSTODIAN" means
any receiver, trustee, assignee, liquidator, sequestrator or similar official
under any Bankruptcy Law.

         "DEFAULT" means an event or condition the occurrence of which is, or
with the lapse of time or the giving of notice or both would be, an Event of
Default.

         "DEFEASANCE PAYMENT" means any distribution from any defeasance trust
described under SECTION 8.1.

         "DEPOSITARY" means The Depository Trust Company, its nominees and
successors.

         "DESIGNATED SENIOR INDEBTEDNESS" means (i) Indebtedness under or in
respect of the Credit Agreement and (ii) any other Indebtedness constituting
Senior Indebtedness which, at the time of determination, has an aggregate
principal amount of at least $25.0 million and is specifically designated in the
instrument evidencing such Senior Indebtedness as "Designated Senior
Indebtedness" by LNR.

         "DISQUALIFIED CAPITAL STOCK" means that portion of any Capital Stock
which, by its terms (or by the terms of any security into which it is
convertible or for which it is exchangeable), or upon the happening of any
event, matures or is mandatorily redeemable, pursuant to a sinking fund
obligation or otherwise, or is redeemable at the sole option of the holder
thereof (other than as a result of a Change of Control) on or prior to the final
maturity of the Notes.

                                      -8-
<PAGE>
         "EVENT OF DEFAULT" has the meaning provided in SECTION 6.1.

         "EXCHANGE ACT" means the Securities Exchange Act of 1934, as amended,
or any successor statute or statutes thereto.

         "EXCHANGE NOTES" means the 7.25% Senior Subordinated Notes due 2013,
Series B to be issued in exchange for the Initial Notes pursuant to (i) the
Registration Rights Agreement, or (ii) with respect to Initial Notes issued
under this Indenture subsequent to the Issue Date pursuant to SECTION 2.2 and
SECTION 4.12, a registration rights agreement substantially identical to the
Registration Rights Agreement.

         "EXCHANGE OFFER" has the meaning provided in the Registration Rights
Agreement.

         "EXISTING INDEBTEDNESS" means (i) Indebtedness of LNR under the 10-1/2%
Senior Subordinated Notes due 2009, (ii) Indebtedness of LNR and its
Subsidiaries (other than Indebtedness under the Credit Agreement) in existence
on the Base Date or incurred subsequent to the Base Date and on or prior to the
Issue Date in compliance with the terms of the Base Date Indenture (other than
compliance because it is "Permitted Indebtedness" thereunder), until such
amounts are repaid.

         "FAIR MARKET VALUE" means, with respect to any asset or property, the
price which could be negotiated in an arm's-length, free market transaction, for
cash, between a willing seller and a willing and able buyer, neither of whom is
under undue pressure or compulsion to complete the transaction. Fair market
value shall be determined by the Board of Directors of LNR acting reasonably and
in good faith and shall be evidenced by a Board Resolution of the Board of
Directors of LNR.

         "GAAP" means generally accepted accounting principles set forth in the
opinions and pronouncements of the Accounting Principles Board of the American
Institute of Certified Public Accountants and statements and pronouncements of
the Financial Accounting Standards Board or in such other statements by such
other entity as may be approved by a significant segment of the accounting
profession of the United States, which are in effect on the Issue Date, except
that revenues, expenses, gains and losses that are included in results of
discontinued operations because of the application of Statement of Financial
Accounting Standards No. 144 will be treated as revenues, expenses, gains and
losses from continuing operations. For this purpose, Financial Accounting
Standards Board Interpretation 46 will apply to entities created after January
31, 2003, but not to entities created before that date.

         "GLOBAL NOTE" has the meaning provided in SECTION 2.1.

         "GUARANTEE" means any obligation, contingent or otherwise, of any
Person directly or indirectly guaranteeing any Indebtedness or other obligation
of any other Person and, without limiting the generality of the foregoing, any
obligation, direct or indirect, contingent or otherwise, of such Person (i) to
purchase or pay (or advance or supply funds for the purchase or payment of) such
Indebtedness or other obligation of such other Person (whether arising by virtue
of partnership arrangements, or by agreement to keep-well, to purchase assets,
goods, securities or services, to take-or-pay, or to maintain financial
statement conditions or otherwise)

                                      -9-
<PAGE>
or (ii) entered into for purposes of assuring in any other manner the obligee of
such Indebtedness or other obligation of the payment thereof or to protect such
obligee against loss in respect thereof (in whole or in part) (but if in part,
only to the extent thereof); PROVIDED, HOWEVER, that the term "guarantee" shall
not include (A) endorsements for collection or deposit in the ordinary course of
business and (B) guarantees (other than guarantees of Indebtedness) by LNR in
respect of assisting one or more Subsidiaries in the ordinary course of their
respective businesses, including without limitation guarantees of trade
obligations and operating leases, on ordinary business terms. The term
"guarantee" used as a verb has a corresponding meaning.

         "HOLDER" means any holder of Notes.

         "IAI GLOBAL NOTE" means, a permanent global note in registered form
representing the aggregate principal amount of Notes sold to Institutional
Accredited Investors.

         "INCUR" has the meaning set forth in SECTION 4.12.

         "INDEBTEDNESS" means, with respect to any Person, without duplication,

         (i) all Obligations of such Person for borrowed money,

         (ii) all Obligations of such Person evidenced by bonds, debentures,
notes or other similar instruments,

         (iii) all Capitalized Lease Obligations of such Person,

         (iv) all Obligations of such Person issued or assumed as the deferred
purchase price of property, all conditional sale obligations and all Obligations
under any title retention agreement (but excluding trade accounts payable and
other accrued liabilities arising in the ordinary course of business),

         (v) all Obligations for the reimbursement of any obligor on any letter
of credit, banker's acceptance or similar credit transaction,

         (vi) guarantees and other contingent obligations in respect of
Indebtedness of any other Person that is referred to in clauses (i) through (v)
above and clause (viii) below,

         (vii) all Obligations of any other Person of the kinds referred to in
clauses (i) through (vi) above and clause (viii) below which are secured by any
lien on any property or asset of such Person, the amount of such Obligation
being deemed to be the lesser of the fair market value of such property or asset
or the amount of the Obligation so secured,

         (viii) all Obligations under currency agreements and interest swap
agreements of such Person and

         (ix) all Disqualified Capital Stock issued by such Person with the
amount of Indebtedness represented by such Disqualified Capital Stock being
equal to the greater of its voluntary or involuntary liquidation preference and
its maximum fixed repurchase price, but excluding accrued dividends, if any.

                                      -10-
<PAGE>
For purposes hereof, the amount of any guarantee or other contingent obligation
in respect of Indebtedness of (A) any other Person (other than a Subsidiary of
such Person) shall be deemed to be equal to the maximum amount of such
Indebtedness, unless the liability is otherwise limited by the terms of such
guarantee or other contingent obligation regarding such Indebtedness, in which
case, the amount of such guarantee or other obligation shall be deemed to equal
the maximum amount of such liability and (B) any Subsidiary of such Person, at
the option of such Person, shall be deemed to be either the amount determined
pursuant to clause (A) or the actual outstanding amount of such Indebtedness.
For purposes hereof, the "maximum fixed repurchase price" of any Disqualified
Capital Stock which does not have a fixed repurchase price shall be calculated
in accordance with the terms of such Disqualified Capital Stock as if such
Disqualified Capital Stock were purchased on any date on which Indebtedness
shall be required to be determined pursuant to this Indenture, and if such price
is based upon, or measured by, the fair market value of such Disqualified
Capital Stock, such fair market value shall be determined reasonably and in good
faith by the Board of Directors of the issuer of such Disqualified Capital
Stock.

         "INDENTURE" means this Indenture, as amended or supplemented from time
to time in accordance with the terms hereof.

         "INDEPENDENT FINANCIAL ADVISOR" means a firm (i) which does not, and
whose directors, officers and employees or Affiliates do not, have a direct or
indirect financial interest in LNR or any Subsidiary thereof and (ii) which, in
the judgment of the Board of Directors of LNR, is otherwise independent and
qualified to perform the task for which it is to be engaged.

         "INITIAL NOTES" means, collectively, (i) the 7.25% Senior Subordinated
Notes due 2013, Series A, of LNR issued on the Issue Date and (ii) any other
7.25% Senior Subordinated Notes due 2013, Series A that are issued under this
Indenture, subsequent to the Issue Date, pursuant to SECTION 2.2 AND SECTION
4.12, in each case for so long as each such securities constitute Restricted
Securities.

         "INITIAL PURCHASERS" means Deutsche Bank Securities, Inc., Citigroup
Capital Markets, Inc., Banc of America Securities LLC and Fleet Securities, Inc.

         "INSTITUTIONAL ACCREDITED INVESTOR" means an institution that is an
"accredited investor" as that term is defined in Rule 501(a)(1), (2), (3) or (7)
under the Securities Act.

         "INTEREST" means, when used with respect to any Note, the amount of all
interest accruing on such Note, including any applicable defaulted interest
pursuant to SECTION 2.12 and any Additional Interest pursuant to the applicable
Registration Rights Agreement.

         "INTEREST PAYMENT DATE" means the stated maturity of an installment of
interest on the Notes.

         "INTEREST SWAP OBLIGATIONS" means the obligations of any Person
pursuant to any arrangement with any other Person, whereby, directly or
indirectly, such Person is entitled to receive from time to time periodic
payments calculated by applying either a floating or a fixed rate of interest on
a stated notional amount in exchange for periodic payments made by such other
Person calculated by applying a fixed or a floating rate of interest on a stated
notional

                                      -11-
<PAGE>
amount and shall include, without limitation, interest rate swaps, caps, floors,
collars and similar agreements.

         "INTERNAL REVENUE CODE" means the Internal Revenue Code of 1986, as
amended to the date hereof and from time to time hereafter.


         "INVESTMENT" means, with respect to any Person, any direct or indirect
loan or other extension of credit (including, without limitation, a guarantee)
or capital contribution to (by means of any transfer of cash or other property
to others or any payment for property or services for the account or use of
others), or any purchase or acquisition by such Person of any Capital Stock,
bonds, notes, debentures or other securities or evidences of Indebtedness issued
by, any Person. "Investment" shall exclude extensions of trade credit by LNR and
its Subsidiaries on commercially reasonable terms in accordance with normal
trade practices of LNR or such Subsidiary, as the case may be.

         "ISSUE DATE" means October 29, 2003.

         "LAND PARTNERSHIP" means (1) Lennar Land Partners, a Delaware general
partnership, (2) Lennar Land Partners II, a Delaware general partnership, (3)
NWHL Investment LLC, a Delaware limited liability company, and (4) any entity
jointly owned by Lennar Corporation and LNR that owns or succeeds to Lennar Land
Partners, Lenar Land Partners II, and NWHL Investment LLC.

         "LEGAL DEFEASANCE" has the meaning set forth in SECTION 8.1.

         "LEGAL HOLIDAY" has the meaning provided in SECTION 11.7.

         "LIEN" means any lien, mortgage, deed of trust, pledge, security
interest, charge or encumbrance of any kind (including any conditional sale or
other title retention agreement, any lease in the nature thereof and any
agreement to give any security interest).

         "LNR" means the party named as such in this Indenture until a successor
replaces it pursuant to this Indenture and thereafter means such successor and
also includes for the purposes of any provision contained herein and required by
the TIA any other obligor on the Notes.

         "MATURITY DATE" means October 15, 2013.

         "MORTGAGE SUBSIDIARY" means a Wholly Owned Subsidiary of LNR to be
formed after the Base Date solely for the purpose of engaging in the mortgage
banking business and incidental activities directly related thereto.

         "NON-RECOURSE INDEBTEDNESS" means any Indebtedness of LNR or any of its
Subsidiaries that is (i) (A) specifically advanced to finance the acquisition of
investment assets and (B) secured only by the assets to which such Indebtedness
relates without recourse to LNR or any of its Subsidiaries, (ii) advanced to a
Subsidiary of LNR or group of Subsidiaries of LNR formed for the sole purpose of
acquiring or holding investment assets (A) against which a loan is obtained that
is made without recourse to, and with no cross-collateralization against the
assets of, LNR or

                                      -12-
<PAGE>
any other Subsidiary of LNR, and (B) upon complete or partial liquidation of
which the loan must be correspondingly completely or partially repaid, as the
case may be or (iii) specifically advanced to finance the acquisition of real
property and secured by only the real property to which such Indebtedness
relates without recourse to LNR or any of its Subsidiaries.

         "NON-U.S. PERSON" means a person who is not a U.S. person, as defined
in Regulation S.

         "NOTES" means, collectively, the Initial Notes, the Private Exchange
Notes, if any, and the Unrestricted Notes, treated as a single class of
securities, as amended or supplemented from time to time in accordance with the
terms of this Indenture, that are issued pursuant to this Indenture.

         "OBLIGATIONS" means all obligations for principal, premium, interest,
penalties, fees, indemnifications, reimbursements, damages and other liabilities
payable under the documentation governing any Indebtedness.

         "OFFICER" means, with respect to any Person, the Chairman of the Board
of Directors, the Chief Executive Officer, the President, any Vice President,
the Chief Financial Officer, the Treasurer, the Controller, or the Secretary of
such Person, or any other officer designated by the Board of Directors serving
in a similar capacity.

         "OFFICERS' CERTIFICATE" means a certificate signed by the Chairman of
the Board of Directors, the Chief Executive Officer, the President or any Vice
President and the Chief Financial Officer, Controller or any Treasurer of LNR
and otherwise complying with the requirements of SECTION 11.4 AND 11.5.

         "OPINION OF COUNSEL" means a written opinion from legal counsel who is
reasonably acceptable to the Trustee complying with the requirements of SECTIONS
11.4 AND 11.5, as they relate to the giving of an Opinion of Counsel.

         "PAYING AGENT" has the meaning provided in SECTION 2.3.

         "PERMITTED AFFILIATE TRANSACTIONS" has the meaning provided in SECTION
4.11(B).

         "PERMITTED HOLDER" means any person who, at the Issue Date, is a holder
of the Class B common stock of LNR and any permitted transferee of the Class B
common stock of LNR under the terms of the Certificate of Incorporation of LNR
as it exists on October 15, 2003.

         "PERMITTED INDEBTEDNESS" means, without duplication, each of the
following:

                  (1) Indebtedness under the Notes in an aggregate principal
         amount not in excess of $300,000,000;

                  (2) Indebtedness incurred pursuant to the Credit Agreement in
         an aggregate outstanding principal amount at any time not to exceed
         $220,000,000;

                                      -13-
<PAGE>
                  (3) Interest Swap Obligations of LNR covering Indebtedness of
         LNR or any of its Subsidiaries; PROVIDED, HOWEVER, that such Interest
         Swap Obligations are entered into to protect LNR and its Subsidiaries
         from fluctuations in interest rates on Indebtedness incurred in
         accordance with this Indenture to the extent the notional principal
         amount of such Interest Swap Obligation does not exceed the principal
         amount of the Indebtedness to which such Interest Swap Obligation
         relates;

                  (4) Indebtedness under Currency Agreements; PROVIDED, HOWEVER,
         that in the case of Currency Agreements which relate to Indebtedness,
         such Currency Agreements do not increase the Indebtedness of LNR or its
         Subsidiaries outstanding other than as a result of fluctuations in
         foreign currency exchange rates or by reason of fees, indemnities and
         compensation payable thereunder;

                  (5) Indebtedness of a Subsidiary to LNR or to a Wholly Owned
         Subsidiary of LNR for so long as such Indebtedness is held by LNR or a
         Wholly Owned Subsidiary of LNR, in each case subject to no Liens held
         by any Person other than LNR or a Wholly Owned Subsidiary of LNR;
         PROVIDED, HOWEVER, that if as of any date any Person other than LNR or
         a Wholly Owned Subsidiary of LNR owns or holds any such Indebtedness or
         holds a Lien in respect of such Indebtedness, such date shall be deemed
         the date of incurrence of Indebtedness not constituting Permitted
         Indebtedness by the issuer of such Indebtedness unless such
         Indebtedness is otherwise permitted under this Indenture;

                  (6) Indebtedness of LNR to a Wholly Owned Subsidiary of LNR
         for so long as such Indebtedness is held by a Wholly Owned Subsidiary
         of LNR, in each case subject to no Lien; PROVIDED, HOWEVER, that (a)
         any Indebtedness of LNR to any Wholly Owned Subsidiary of LNR is
         unsecured and subordinated, pursuant to a written agreement, to LNR's
         obligations under the Indenture and the Notes at least to the same
         extent that the Notes are subordinated to Senior Indebtedness and (b)
         if as of any date any Person other than a Wholly Owned Subsidiary of
         LNR owns or holds any such Indebtedness or a Lien in respect of such
         Indebtedness, such date shall be deemed the date of incurrence of
         Indebtedness not constituting Permitted Indebtedness by LNR unless such
         Indebtedness is otherwise permitted under this Indenture;

                  (7) Indebtedness arising from the honoring by a bank or other
         financial institution of a check, draft or similar instrument
         inadvertently (except in the case of daylight overdrafts) drawn against
         insufficient funds in the ordinary course of business; PROVIDED,
         HOWEVER, that such Indebtedness is extinguished within three Business
         Days of incurrence;

                  (8) Indebtedness of LNR or any of its Subsidiaries represented
         by letters of credit for the account of LNR or such Subsidiaries, as
         the case may be, in order to provide security for workers' compensation
         claims, payment obligations in connection with self-insurance or
         similar requirements in the ordinary course of business;

                  (9) Existing Indebtedness outstanding on the Issue Date;

                  (10) Non-Recourse Indebtedness of the Mortgage Subsidiary;


                                      -14-
<PAGE>
                  (11) additional Indebtedness in an aggregate principal amount
         not to exceed $50.0 million at any time outstanding; and

                  (12) Refinancing Indebtedness.

         "PERSON" means an individual, partnership, corporation, limited
liability company, unincorporated organization, trust or joint venture, or a
governmental agency or political subdivision thereof.

         "PHYSICAL NOTES" has the meaning provided in SECTION 2.1.

         "PREFERRED STOCK" of any Person means any Capital Stock of such Person
that has preferential rights to any other Capital Stock of such Person with
respect to dividends or redemptions or upon liquidation.

         "PRINCIPAL" of any Indebtedness (including the Notes) means the
principal amount of such Indebtedness determined in accordance with GAAP plus
(but without the duplication) the premium, if any, on such Indebtedness.

         "PRIVATE EXCHANGE NOTES" shall have the meaning provided in the
Registration Rights Agreement(s).

         "PRIVATE PLACEMENT LEGEND" means the legend initially set forth on the
Initial Notes in the form set forth in EXHIBIT A.

         "PRO FORMA" means, with respect to any calculation made or required to
be made pursuant to the terms of this Indenture, a calculation in accordance
with Article 11 of Regulation S-X under the Securities Act.

         "PUBLIC EQUITY OFFERING" means an underwritten public offering of
Qualified Capital Stock of LNR pursuant to an effective registration statement
filed with the Commission in accordance with the Securities Act.

         "QUALIFIED CAPITAL STOCK" means any Capital Stock that is not
Disqualified Capital Stock.

         "QUALIFIED INSTITUTIONAL BUYER" or "QIB" shall have the meaning
specified in Rule 144A.

         "RECORD DATE" means the Record Dates specified in the Notes.

         "RECOURSE INDEBTEDNESS" means all Indebtedness of LNR and its
Subsidiaries other than Non-Recourse Indebtedness.

         "REDEMPTION DATE" means, when used with respect to any Note to be
redeemed, the date fixed for such redemption pursuant to this Indenture and the
Notes.

                                      -15-
<PAGE>
            "REDEMPTION PRICE" means, when used with respect to any Note to be
redeemed, the price fixed for such redemption, including principal and premium,
if any, pursuant to this Indenture and the Notes.

            "REFERENCE DATE" has the meaning set forth in SECTION 4.10.

            "REFINANCE" means, in respect of any security or Indebtedness, to
refinance, extend, renew, refund, repay, prepay, redeem, defease or retire, or
to issue a security or Indebtedness in exchange or replacement for, such
security or Indebtedness in whole or in part. "Refinanced" and "Refinancing"
shall have correlative meanings.

            "REFINANCING INDEBTEDNESS" means any Refinancing by LNR or any
Subsidiary of LNR of Indebtedness incurred in accordance with SECTION 4.12
(other than pursuant to clauses (2), (3), (4), (5), (6), (7), (8), (10), (11) or
(12) of the definition of Permitted Indebtedness), in each case that does not:

            (1) result in an increase in the aggregate principal amount of
Indebtedness of such Person as of the date of such proposed Refinancing (plus
the amount of any premium required to be paid under the terms of the instrument
governing such Indebtedness and plus the amount of reasonable fees and expenses
incurred by LNR or such Subsidiary, as the case may be, in connection with such
Refinancing), except to the extent that any such increase in Indebtedness is
otherwise permitted by this Indenture or

            (2) create Indebtedness with

            (A) a Weighted Average Life to Maturity that is less than the
      Weighted Average Life to Maturity of the Indebtedness being Refinanced or

            (B) a final maturity earlier than the final maturity of the
      Indebtedness being Refinanced;

PROVIDED, HOWEVER, that (x) if such Indebtedness being Refinanced is
Indebtedness of LNR, then such Refinancing Indebtedness shall be Indebtedness
solely of LNR, (y) if such Indebtedness being Refinanced is equal in right of
payment with the Notes, then such Refinancing Indebtedness shall be equal in
right of payment with or subordinate to the Notes, and (z) if such Indebtedness
being Refinanced is subordinate or junior in right of payment to the Notes, then
such Refinancing Indebtedness shall be subordinate to the Notes at least to the
same extent and in the same manner as the Indebtedness being Refinanced.

            "REGISTRAR" has the meaning provided in SECTION 2.3.

            "REGISTRATION RIGHTS AGREEMENT" means, as applicable, (i) the
Registration Rights Agreement dated as of the Issue Date among LNR and the
Initial Purchasers or (ii) any registration rights agreement, substantially
identical to the Registration Rights Agreement, entered into among LNR and the
respective purchasers, on substantially identical terms, relating to any Initial
Notes issued pursuant to SECTION 2.2.

            "REGULATION S" means Regulation S under the Securities Act.


                                      -16-
<PAGE>
            "REGULATION S GLOBAL NOTE" means a permanent global note in
registered form representing the aggregate principal amount of Notes sold in
reliance on Regulation S under the Securities Act.

            "REPRESENTATIVE" means the indenture trustee or other trustee, agent
or representative in respect of any Designated Senior Indebtedness; PROVIDED,
HOWEVER, that if, and for so long as, any Designated Senior Indebtedness lacks
such a representative, then the Representative for such Designated Senior
Indebtedness shall at all times constitute the holders of a majority in
outstanding principal amount of such Designated Senior Indebtedness in respect
of any Designated Senior Indebtedness.

            "RESTRICTED PAYMENT" shall have the meaning set forth in SECTION
4.10.

            "RESTRICTED SECURITY" has the meaning assigned to such term in Rule
144(a)(3) under the Securities Act; PROVIDED, HOWEVER, that the Trustee shall be
entitled to request and conclusively rely on an opinion of Counsel with respect
to whether any Note constitutes a Restricted Security.

            "RULE 144A" means Rule 144A under the Securities Act.

            "SECURITIES ACT" means the Securities Act of 1933, as amended, and
the rules and regulations of the Commission promulgated thereunder.

            "SENIOR INDEBTEDNESS" means the principal of, premium, if any, and
interest (including any interest accruing subsequent to the filing of a petition
of bankruptcy at the rate provided for in the documentation with respect
thereto, whether or not such interest is an allowed claim under applicable law)
on any Indebtedness of LNR, whether outstanding on the Issue Date or thereafter
created, incurred or assumed, unless, in the case of any particular
Indebtedness, the instrument creating or evidencing the same or pursuant to
which the same is outstanding expressly provides that such Indebtedness shall
not be senior in right of payment to the Notes. Without limiting the generality
of the foregoing, "Senior Indebtedness" shall also include the principal of,
premium, if any, interest (including any interest accruing subsequent to the
filing of a petition of bankruptcy at the rate provided for in the documentation
with respect thereto, whether or not such interest is an allowed claim under
applicable law) on, and all other amounts owing in respect of,

      (1) all monetary obligations (including guarantees thereof) of every
nature of LNR under the Credit Agreement, including, without limitation,
obligations to pay principal and interest, reimbursement obligations under
letters of credit, fees, expenses and indemnities,

      (2) all Interest Swap Obligations (including guarantees thereof) and

      (3) all obligations (including guarantees) under Currency Agreements,

in each case whether outstanding on the Issue Date or thereafter incurred.
Notwithstanding the foregoing, "SENIOR INDEBTEDNESS" shall not include:

      (1) any Indebtedness of LNR to a Subsidiary of LNR or any Affiliate of LNR
or any of such Affiliate's Subsidiaries,


                                      -17-
<PAGE>
      (2) Indebtedness to, or guaranteed on behalf of, any shareholder,
director, officer or employee of LNR or of any Subsidiary of LNR (including,
without limitation, amounts owed for compensation),

      (3) Indebtedness to trade creditors and other amounts incurred in
connection with obtaining goods, materials or services,

      (4) Indebtedness represented by Disqualified Capital Stock,

      (5) any liability for federal, state, local or other taxes owed or owing
by LNR,

      (6) that portion of any Indebtedness incurred in violation of SECTION
4.12,

      (7) Indebtedness which, when incurred and without respect to any election
under Section 1111(b) of Title 11, United States Code is without recourse to LNR
and

      (8) any Indebtedness which is, by its express terms, subordinated in right
of payment to any other Indebtedness of LNR.

            "SENIOR RECOURSE INDEBTEDNESS" means all Senior Indebtedness other
than Senior Indebtedness that is Non-Recourse Indebtedness PLUS Subsidiary
Unsubordinated Indebtedness of each Subsidiary of LNR (but only to the extent
not in excess of the book value of the assets of the issuer thereof) other than
Subsidiary Unsubordinated Indebtedness of such Subsidiary that is Non-Recourse
Indebtedness.

            "SUBORDINATED INDEBTEDNESS" means all Indebtedness of LNR and its
Subsidiaries which expressly provides that such Indebtedness shall be
subordinated in right of payment to any other Indebtedness.

            "SUBSIDIARY" means, with respect to any Person, (i) any corporation
of which the outstanding Capital Stock having at least a majority of the votes
entitled to be cast in the election of directors under ordinary circumstances
shall at the time be owned, directly or indirectly, by such Person, (ii) any
other Person (other than a partnership) of which at least a majority of the
voting interest under ordinary circumstances is at the time, directly or
indirectly, owned by such Person or (iii) any partnership (a) the sole general
partner or the managing general partner of which is such Person or a Subsidiary
of such Person or (b) the only general partners of which are such Person or one
or more Subsidiaries of such Person (or any combination thereof).

            "SUBSIDIARY UNSUBORDINATED INDEBTEDNESS" means all Indebtedness of a
Subsidiary of LNR other than Subordinated Indebtedness thereof.

            "SURVIVING ENTITY" shall have the meaning set forth in SECTION 5.1.

            "TIA" means the Trust Indenture Act of 1939 (15 U.S.C. Sections
77aaa-77bbbb), as amended, as in effect on the date of this Indenture, except as
otherwise provided in SECTION 9.3.


                                      -18-
<PAGE>
            "TRUSTEE" means the party named as such in this Indenture until a
successor replaces it in accordance with the provisions of this Indenture and
thereafter means such successor.

            "TRUST OFFICER" means any officer or assistant officer of the
Trustee assigned by the Trustee to administer this Indenture, or in the case of
a successor trustee, an officer assigned to the department, division or group
performing the corporation trust work of such successor and assigned to
administer this Indenture.

            "U.S. GOVERNMENT OBLIGATIONS" means direct obligations of, and
obligations guaranteed by, the United States of America for the payment of which
the full faith and credit of the United States of America is pledged.

            "U.S. LEGAL TENDER" means such coin or currency of the United States
of America as at the time of payment shall be legal tender for the payment of
public and private debts.

            "UNRESTRICTED NOTES" means one or more Notes that do not and are not
required to bear the Private Placement Legend, including, without limitation,
the Exchange Notes.

            "WEIGHTED AVERAGE LIFE TO MATURITY" means, when applied to any
Indebtedness at any date, the number of years obtained by dividing (a) the then
outstanding aggregate principal amount of such Indebtedness into (b) the sum of
the total of the products obtained by multiplying (i) the amount of each then
remaining installment, sinking fund, serial maturity or other required payment
of principal, including payment at final maturity, in respect thereof, by (ii)
the number of years (calculated to the nearest one-twelfth) which will elapse
between such date and the making of such payment.

            "WHOLLY OWNED SUBSIDIARY" means, with respect to any Person, any
Subsidiary of such Person (i) of which all the outstanding voting securities
normally entitled to vote in the election of directors are owned by such Person
or any Wholly Owned Subsidiary of such Person (other than directors qualifying
shares or an immaterial amount of shares required to be owned by other Persons
pursuant to applicable law) or (ii) all the outstanding partnership interests
are owned by such Person or any Wholly Owned Subsidiary of such Person.

SECTION 1.2.      INCORPORATION BY REFERENCE OF TIA.

            Whenever this Indenture refers to a provision of the TIA, such
provision is incorporated by reference in, and made a part of, this Indenture.
The following TIA terms used in this Indenture have the following meanings:

            "INDENTURE SECURITIES" means the Notes.

            "INDENTURE SECURITY HOLDER" means a Holder.

            "INDENTURE TO BE QUALIFIED" means this Indenture.

            "INDENTURE TRUSTEE" or "INSTITUTIONAL TRUSTEE" means the Trustee.


                                      -19-
<PAGE>
            "OBLIGOR" on the indenture securities means LNR or any other obligor
on the Notes.

            All other TIA terms used in this Indenture that are defined by the
TIA, defined by TIA reference to another statute or defined by Commission rule
and not otherwise defined herein have the meanings assigned to them therein.

SECTION 1.3.      RULES OF CONSTRUCTION.

            Unless the context otherwise requires:

            (1) a term has the meaning assigned to it;

            (2) an accounting term not otherwise defined has the meaning
      assigned to it in accordance with GAAP of any date of determination;

            (3) "or" is not exclusive;

            (4) words in the singular include the plural, and words in the
      plural include the singular;

            (5) "herein," "hereof" and other words of similar import refer to
      this Indenture as a whole and not to any particular Article, Section or
      other subdivision; and

            (6) any reference to a statute, law or regulation means that
      statute, law or regulation as amended and in effect from time to time and
      includes any successor statute, law or regulation; provided, HOWEVER, that
      any reference to the Bankruptcy Law shall mean the Bankruptcy Law as
      applicable to the relevant case.

                                ARTICLE II.

                                 THE NOTES

SECTION 2.1.      FORM AND DATING.

            The Initial Notes and the Trustee's certificate of authentication
relating thereto shall be substantially in the form of EXHIBIT A hereto,
PROVIDED, that any Initial Notes issued in a public offering shall be
substantially in the form of EXHIBIT B hereto. The Exchange Notes and the
Trustee's certificate of authentication relating thereto shall be substantially
in the form of EXHIBIT B hereto. The Notes may have notations, legends or
endorsements required by law, stock exchange rule or depository rule or usage.
LNR and the Trustee shall approve the form of the Notes and any notation, legend
or endorsement on them. Each Note shall be dated the date of its issuance and
shall show the date of its authentication.

            The terms and provisions contained in the Notes annexed hereto as
EXHIBITS A AND B shall constitute, and are hereby expressly made, a part of this
Indenture and, to the extent applicable, LNR and the Trustee, by their execution
and delivery of this Indenture, expressly agree to such terms and provisions and
to be bound thereby.


                                      -20-
<PAGE>
            Notes offered and sold in reliance on Rule 144A and Notes offered
and sold in reliance on Regulation S shall be issued initially in the form of
one or more permanent global Notes in registered form, substantially in the form
set forth in EXHIBIT A (each, a "GLOBAL NOTE"), deposited with the Trustee, as
custodian for the Depositary, duly executed by LNR and authenticated by the
Trustee as hereinafter provided and shall bear the legend set forth in EXHIBIT
C. The aggregate principal amount of the Global Note may from time to time be
increased or decreased by adjustments made on the records of the Trustee, as
custodian for the Depositary, as hereinafter provided.

            Notes issued in exchange for interests in a Global Note pursuant to
SECTION 2.16 may be issued and Notes offered and sold in reliance on any other
exemption from registration under the Securities Act other than as described in
the preceding paragraph shall be issued in the form of permanent certificated
Notes in registered form in substantially the form set forth in EXHIBIT A (the
"PHYSICAL NOTES").

            All Notes offered and sold in reliance on Regulation S shall remain
in the form of a Global Note until the consummation of the Exchange Offer
pursuant to the Registration Rights Agreement; PROVIDED, HOWEVER, that all of
the time periods specified in the Registration Rights Agreement to be complied
with by LNR have been so complied with.

SECTION 2.2.      EXECUTION AND AUTHENTICATION; AGGREGATE PRINCIPAL AMOUNT.

            An Officer of LNR (duly authorized by all requisite corporate
actions) shall sign and attest to the Notes for LNR by manual or facsimile
signature.

            If an Officer whose signature is on a Note was an Officer at the
time of such execution but no longer holds that office or position at the time
the Trustee authenticates the Note, the Note shall nevertheless be valid.

            A Note shall not be valid until an authorized signatory of the
Trustee manually signs the certificate of authentication on the Note. The
signature shall be conclusive evidence that the Note has been authenticated
under this Indenture.

            The Trustee shall authenticate all (i) Initial Notes; (ii) Private
Exchange Notes from time to time for issue only in exchange for a like principal
amount of Initial Notes and (iii) Unrestricted Notes from time to time upon a
written order of LNR in the form of an Officers' Certificate of LNR. Each such
written order shall specify the amount of Notes to be authenticated and the date
on which the Notes are to be authenticated, whether the Notes are to be Initial
Notes, Private Exchange Notes or Unrestricted Notes and whether the Notes are to
be issued as Physical Notes or Global Notes or such other information as the
Trustee may reasonably request.

            The Trustee may appoint an authenticating agent (the "AUTHENTICATING
AGENT") reasonably acceptable to LNR to authenticate Notes. Unless otherwise
provided in the appointment, an Authenticating Agent may authenticate Notes
whenever the Trustee may do so. Each reference in this Indenture to
authentication by the Trustee includes authentication by such Authenticating
Agent. An Authenticating Agent has the same rights as an Agent to deal with LNR
or with any Affiliate of LNR.


                                      -21-
<PAGE>
            The Notes shall be issuable in fully registered form only, without
coupons, in denominations of $1,000 and any integral multiple thereof.

SECTION 2.3.      REGISTRAR AND PAYING AGENT.

            LNR shall maintain an office or agency (which shall be located in
the Borough of Manhattan in the City of New York, State of New York) where (a)
Notes may be presented or surrendered for registration of transfer or for
exchange ("REGISTRAR"), (b) Notes may be presented or surrendered for payment
("PAYING AGENT") and (c) notices and demands to or upon LNR in respect of the
Notes and this Indenture may be served. The Registrar shall keep a register of
the Notes and of their transfer and exchange. LNR may have one or more
co-Registrars and one or more additional paying agents reasonably acceptable to
the Trustee. The term "Paying Agent" includes any additional Paying Agent. LNR
may act as its own Paying Agent, except that for the purposes of payments on the
Notes pursuant to SECTION 4.14, neither LNR nor any Affiliate of LNR may act as
Paying Agent. If LNR elects to act as its own paying agent, LNR will notify the
Trustee of its election and will hold for the benefit of the Holders all assets
for the payment of principal of premium, if any, or interest on, the Notes.

            LNR shall enter into an appropriate agency agreement with any Agent
not a party to this Indenture, which agreement shall incorporate the provisions
of the TIA and implement the provisions of this Indenture that relate to such
Agent. LNR shall notify the Trustee of the name and address of any such Agent.
If LNR shall fail to maintain a Registrar or Paying Agent the Trustee shall act
as such.

            LNR initially appoints the Trustee as Registrar, Paying Agent and
agent for service of demands and notices in connection with the Notes, until
such time as the Trustee has resigned or a successor has been appointed. Any of
the Registrar, the Paying Agent or any other agent may resign upon 30 days'
notice to LNR.

SECTION 2.4.      PAYING AGENT TO HOLD ASSETS IN TRUST.

            LNR shall require each Paying Agent other than the Trustee to agree
in writing that such Paying Agent shall hold in trust for the benefit of the
Holders or the Trustee all assets held by the Paying Agent for the payment of
principal of, premium, if any, or interest on, the Notes (whether such assets
have been distributed to it by LNR or any other obligor on the Notes), and LNR
and the Paying Agent shall notify the Trustee of any Default by LNR (or any
other obligor on the Notes) in making any such payment. LNR at any time may
require a Paying Agent to distribute all assets held by it to the Trustee and
account for any assets disbursed and the Trustee may at any time during the
continuance of any payment Default, upon written request to a Paying Agent,
require such Paying Agent to distribute all assets held by it to the Trustee and
to account for any assets distributed. Upon distribution to the Trustee of all
assets that shall have been delivered to the Paying Agent, the Paying Agent
shall have no further liability for such assets.

SECTION 2.5.      HOLDER LISTS.

            The Trustee shall preserve in as current a form as is reasonably
practicable the most recent list available to it of the names and addresses of
the Holders and shall otherwise


                                      -22-
<PAGE>
comply with TIA Section 312(a). If the Trustee is not the Registrar, LNR shall
furnish or cause the Registrar to furnish to the Trustee five (5) Business Days
before each Record Date and at such other times as the Trustee may request in
writing a list as of such date and in such form as the Trustee may reasonably
require of the names and addresses of the Holders, which list may be
conclusively relied upon by the Trustee, and LNR shall otherwise comply with TIA
Section 312(a).

SECTION 2.6.      TRANSFER AND EXCHANGE.

            Subject to SECTIONS 2.16 AND 2.17, when Notes are presented to the
Registrar or a co-Registrar with a request to register the transfer of such
Notes or to exchange such Notes for an equal principal amount of Notes of other
authorized denominations, the Registrar or co-Registrar shall register the
transfer or make the exchange as requested if its requirements for such
transaction are met; PROVIDED, HOWEVER, that the Notes presented or surrendered
for registration of transfer or exchange shall be duly endorsed or accompanied
by a written instrument of transfer in form satisfactory to LNR, the Trustee and
the Registrar or co-Registrar, duly executed by the Holder thereof or his
attorney duly authorized in writing. To permit registration of transfers and
exchanges, LNR shall execute and the Trustee shall authenticate Notes at the
Registrar's or co-Registrar's request. No service charge shall be made for any
registration of transfer or exchange, but LNR may require payment of a sum
sufficient to cover any transfer tax, fee or similar governmental charge payable
in connection therewith (other than any such transfer taxes or similar
governmental charge payable upon exchanges or transfers pursuant to SECTION
2.10, 3.4, 4.14 OR 9.5, in which event LNR shall be responsible for the payment
of such taxes or charges).

            The Registrar or co-Registrar shall not be required to register the
transfer of or exchange of any Note (i) during a period beginning at the opening
of business 15 days before the mailing of a notice of redemption of Notes and
ending at the close of business on the day of such mailing and (ii) selected for
redemption in whole or in part pursuant to ARTICLE III, except the unredeemed
portion of any Note being redeemed in part.

            Any Holder of a beneficial interest in a Global Note shall, by
acceptance of such Global Note, agree that transfers of beneficial interests in
such Global Notes may be effected only through a book entry system maintained by
the Holder of such Global Note (or its agent), and that ownership of a
beneficial interest in the Note shall be required to be reflected in a book
entry system.

SECTION 2.7.      REPLACEMENT NOTES.

            If a mutilated Note is surrendered to the Trustee or if the Holder
of a Note claims that the Note has been lost, destroyed or wrongfully taken, LNR
shall issue and the Trustee shall authenticate a replacement Note if the
Trustee's requirements are met. If required by the Trustee or LNR, such Holder
must provide an indemnity bond or other indemnity of reasonable tenor,
sufficient in the reasonable judgment of LNR and the Trustee, to protect LNR,
the Trustee or any Agent from any loss which any of them may suffer if a Note is
replaced. Every replacement Note shall constitute an additional obligation of
LNR.


                                      -23-
<PAGE>
SECTION 2.8.      OUTSTANDING NOTES.

            Notes outstanding at any time are all the Notes that have been
authenticated by the Trustee except those canceled by it, those delivered to it
for cancellation and those described in this Section as not outstanding. Subject
to the provisions of SECTION 2.9, a Note does not cease to be outstanding
because LNR or any of its Affiliates holds the Note.

            If a Note is replaced pursuant to SECTION 2.7 (other than a
mutilated Note surrendered for replacement), it ceases to be outstanding unless
the Trustee receives proof satisfactory to it that the replaced Note is held by
a protected purchaser. A mutilated Note ceases to be outstanding upon surrender
of such Note and replacement thereof pursuant to SECTION 2.7.

            If, on a Redemption Date or the Maturity Date, the Paying Agent
holds U.S. Legal Tender or U.S. Government Obligations sufficient to pay all of
the principal, premium, if any, and interest due on the Notes payable on that
date and is not prohibited from paying such money to the Holders thereof
pursuant to the terms of this Indenture, then on and after that date such Notes
shall be deemed not to be outstanding and interest on them shall cease to
accrue.

SECTION 2.9.      TREASURY NOTES.

            In determining whether the Holders of the required principal amount
of Notes have concurred in any direction, waiver, consent or notice, Notes owned
by LNR or an Affiliate of LNR shall be considered as though they are not
outstanding, except that for the purposes of determining whether the Trustee
shall be protected in relying on any such direction, waiver or consent, only
Notes which a Trust Officer of the Trustee has been informed in writing by LNR
to be so owned shall be so considered. LNR shall notify the Trustee, in writing,
when either it or, to its knowledge, any of its Affiliates repurchases or
otherwise acquires Notes, of the aggregate principal amount of such Notes so
repurchased or otherwise acquired and such other information as the Trustee may
reasonably request and the Trustee shall be entitled to rely thereon.

SECTION 2.10.     TEMPORARY NOTES.

            Until definitive Notes are ready for delivery, LNR may prepare and
the Trustee shall authenticate temporary Notes upon receipt of a written order
of LNR in the form of an Officers' Certificate. The Officers' Certificate shall
specify the amount of temporary Notes to be authenticated and the date on which
the temporary Notes are to be authenticated. Temporary Notes shall be
substantially in the form of definitive Notes but may have variations that LNR
consider appropriate for temporary Notes and so indicate in the Officers'
Certificate. Without unreasonable delay, LNR shall prepare and the Trustee shall
authenticate, upon receipt of a written order of LNR pursuant to SECTION 2.2,
definitive Notes in exchange for temporary Notes.

SECTION 2.11.     CANCELLATION.

            LNR at any time may deliver Notes to the Trustee for cancellation.
The Registrar and the Paying Agent shall forward to the Trustee any Notes
surrendered to them for transfer, exchange or payment. The Trustee, or at the
direction of the Trustee, the Registrar or the Paying Agent, and no one else,
shall cancel and, at the written direction of LNR, shall dispose, in its
customary manner, of all Notes surrendered for transfer, exchange, payment or
cancellation.


                                      -24-
<PAGE>
Subject to SECTION 2.7, LNR may not issue new Notes to replace Notes that they
have paid or delivered to the Trustee for cancellation. If LNR shall acquire any
of the Notes, such acquisition shall not operate as a redemption or satisfaction
of the Indebtedness represented by such Notes unless and until the same are
surrendered to the Trustee for cancellation pursuant to this SECTION 2.11.

SECTION 2.12.     DEFAULTED INTEREST.

            LNR shall pay interest on overdue principal from time to time on
demand at the rate of interest then borne by the Notes. LNR shall, to the extent
lawful, pay interest on overdue installments of interest (without regard to any
applicable grace periods) from time to time on demand at the rate of interest
then borne by the Notes. Interest will be computed on the basis of a 360-day
year comprised of twelve 30-day months, and, in the case of a partial month, the
actual number of days elapsed.

            If LNR defaults in a payment of interest on the Notes, it shall pay
the defaulted interest, plus (to the extent lawful) any interest payable on the
defaulted interest, to the Persons who are Holders on a subsequent special
record date, which special record date shall be the fifteenth day next preceding
the date fixed by LNR for the payment of defaulted interest or the next
succeeding Business Day if such date is not a Business Day. LNR shall notify the
Trustee in writing of the amount of defaulted interest proposed to be paid on
each Note and the date of the proposed payment (a "DEFAULT INTEREST PAYMENT
DATE"), and at the same time LNR shall deposit with the Trustee an amount of
money equal to the aggregate amount proposed to be paid in respect of such
defaulted interest or shall make arrangements satisfactory to the Trustee for
such deposit on or prior to the date of the proposed payment, such money when
deposited to be held in trust for the benefit of the Persons entitled to such
defaulted interest as provided in this Section; PROVIDED, HOWEVER, that in no
event shall LNR deposit monies proposed to be paid in respect of defaulted
interest later than 11:00 a.m. New York City time of the proposed Default
Interest Payment Date. At least 15 days before the subsequent special record
date, LNR shall mail (or cause to be mailed) to each Holder, as of a recent date
selected by LNR, with a copy to the Trustee at least 20 days prior to such
special record date, a notice that states the subsequent special record date,
the payment date and the amount of defaulted interest, and interest payable on
such defaulted interest, if any, to be paid. Notwithstanding the foregoing, any
interest which is paid prior to the expiration of the 30-day period set forth in
SECTION 6.1(I) shall be paid to Holders as of the regular record date for the
Interest Payment Date for which interest has not been paid. Notwithstanding the
foregoing, LNR may make payment of any defaulted interest in any other lawful
manner not inconsistent with the requirements of any securities exchange on
which the Notes may be listed, and upon such notice as may be required by such
exchange.

SECTION 2.13.     CUSIP NUMBER.

            In issuing the Notes, LNR may use a "CUSIP" number, and, if so, the
Trustee shall use the CUSIP number in notices of redemption or exchange as a
convenience to Holders; PROVIDED, HOWEVER, that no representation is hereby
deemed to be made by the Trustee as to the correctness or accuracy of the CUSIP
number printed in the notice or on the Notes, and that reliance may be placed
only on the other identification numbers printed on the Notes. LNR shall
promptly notify the Trustee of any change in the CUSIP number.


                                      -25-
<PAGE>
            In the event that LNR shall issue and the Trustee shall authenticate
any Notes issued under this Indenture subsequent to the Issue Date pursuant to
SECTION 2.2, LNR shall use its reasonable efforts to obtain the same "CUSIP"
number for such Notes as is printed on the Notes outstanding at such time and
provides written notice to the Trustee to such effect; PROVIDED, HOWEVER, that
if any series of Notes issued under this Indenture subsequent to the Issue Date
is determined, pursuant to an Opinion of Counsel of LNR in a form reasonably
satisfactory to the Trustee to be a different class of security than the Notes
outstanding at such time for federal income tax or securities laws purposes, LNR
shall use its reasonable efforts to obtain a "CUSIP" number for such Notes that
is different than the "CUSIP" number printed on the Notes then outstanding and
cause such opinion to be delivered to the Trustee. Notwithstanding the foregoing
or any other provision herein to the contrary, all Notes issued under this
Indenture shall vote and consent together on all matters as one class and no
series of Notes will have the right to vote or consent as a separate class on
any matter.

SECTION 2.14.     DEPOSIT OF MONIES.

            Prior to 11:00 a.m. New York City time on each Interest Payment
Date, Maturity Date, Redemption Date or Change of Control Payment Date, LNR
shall have deposited with the Paying Agent in immediately available funds money
sufficient to make cash payments, if any, due on such Interest Payment Date,
Maturity Date, Redemption Date or Change of Control Payment Date, as the case
may be, in a timely manner which permits the Paying Agent to remit payment to
the Holders on such Interest Payment Date, maturity Date, Redemption Date or
Change of Control Payment Date, as the case may be.

SECTION 2.15.     RESTRICTIVE LEGENDS.

            Each Global Note and Physical Note that constitutes a Restricted
Security shall bear the Private Placement Legend on the face thereof until after
the second anniversary of the later of the Issue Date (or in the case of any
Initial Notes issued after the Issue Date, two years after the date of initial
issuance thereof) and the last date on which LNR or any Affiliate of LNR was the
owner of such Note (or any predecessor security) (or such shorter period of time
as permitted by Rule 144(k) under the Securities Act or any successor provision
thereunder) (or such longer period of time as may be required under the
Securities Act or applicable state securities laws in the opinion of counsel for
LNR, unless otherwise agreed by LNR and the Holder thereof).

            Each Global Note shall also bear the legend as set forth in EXHIBIT
C.

SECTION 2.16.     BOOK-ENTRY PROVISIONS FOR GLOBAL SECURITY.

            (a) The Global Notes initially shall (i) be registered in the name
of the Depositary or the nominee of such Depositary, (ii) be delivered to the
Trustee as custodian for such Depositary and (iii) bear the legend as set forth
in EXHIBIT C.

            Members of, or participants in, the Depositary ("AGENT Members")
shall have no rights under this Indenture with respect to any Global Note held
on their behalf by the Depositary, or the Trustee as its custodian, or under the
Global Notes, and the Depositary may be treated by LNR, the Trustee and any
Agent of LNR or the Trustee as the absolute owner of such


                                      -26-
<PAGE>
Global Note for all purposes whatsoever. Notwithstanding the foregoing, nothing
herein shall prevent LNR, the Trustee or any Agent of LNR or the Trustee from
giving effect to any written certification, proxy or other authorization
furnished by the Depositary or impair, as between the Depositary and its Agent
Members, the operation of customary practices governing the exercise of the
rights of a Holder of any Note.

            (b) Transfers of a Global Note shall be limited to transfers in
whole, but not in part, to the Depositary, its successors or their respective
nominees. Interests of beneficial owners in a Global Note may be transferred or
exchanged for Physical Notes in accordance with the rules and procedures of the
Depositary and the provisions of SECTION 2.17. In addition, Physical Notes shall
be transferred to all beneficial owners in exchange for their beneficial
interests in a Global Note if (i) the Depositary notifies LNR that it is
unwilling or unable to continue as Depositary for the Global Notes and a
successor depositary is not appointed by LNR within 90 days of such notice or
(ii) an Event of Default has occurred and is continuing and the Registrar has
received a written request from the Depositary to issue Physical Notes.

            (c) In connection with any transfer or exchange of a portion of the
beneficial interest in a Global Note to beneficial owners pursuant to Section
2.16(b), the Registrar shall (if one or more Physical Notes are to be issued)
reflect on its books and records the date and a decrease in the principal amount
of such Global Note in an amount equal to the principal amount of the beneficial
interest in the Global Note to be transferred, and LNR shall execute and the
Trustee shall authenticate and deliver, one or more Physical Notes of like tenor
and amount.

            (d) In connection with the transfer of an entire Global Note to
beneficial owners pursuant to SECTION 2.16(B), such Global Note shall be deemed
to be surrendered to the Trustee for cancellation, and LNR shall execute and the
Trustee shall authenticate and deliver, to each beneficial owner identified by
the Depositary in exchange for its beneficial interest in the Global Note, an
equal aggregate principal amount of Physical Notes of authorized denominations.

            (e) Any Physical Note constituting a Restricted Security delivered
in exchange for an interest in a Global Note pursuant to SECTION 2.16(B) OR (C)
shall, except as otherwise provided by SECTION 2.17(A)(I)(X) AND (C), bear the
Private Placement Legend.

            (f) The Holder of a Global Note may grant proxies and otherwise
authorize any Person, including Agent Members and Persons that may hold
interests through Agent Members, to take any action which a Holder is entitled
to take under this Indenture or the Notes.

SECTION 2.17.     SPECIAL TRANSFER PROVISIONS.

            (a) TRANSFERS TO NON-QIB INSTITUTIONAL ACCREDITED INVESTORS AND
NON-U.S. PERSONS. The following provisions shall apply with respect to the
registration of any proposed transfer of a Note constituting a Restricted
Security to any Institutional Accredited Investor which is not a QIB or to any
Non-U.S. Person:

                  (i) the Registrar shall register the transfer of any Note
      constituting a Restricted Security, whether or not such Note bears the
      Private Placement Legend, if (x) the requested transfer is after the
      second anniversary of the Issue Date (PROVIDED,


                                      -27-
<PAGE>
      HOWEVER, that neither LNR nor any Affiliate of LNR has held any beneficial
      interest in such Note, or portion thereof, or predecessor security at any
      time on or prior to the second anniversary of the Issue Date (or in the
      case of any Initial Notes issued after the Issue Date, two years after the
      date of initial issuance thereof)) or (y) (1) in the case of a transfer to
      an Institutional Accredited Investor which is not a QIB (excluding
      Non-U.S. Persons), the proposed transferee has delivered to the Registrar
      a certificate substantially in the form of EXHIBIT D hereto or (2) in the
      case of a transfer to a Non-U.S. Person, the proposed transferor has
      delivered to the Registrar a certificate substantially in the form of
      EXHIBIT E hereto; and

                  (ii) if the proposed transferee is an Agent Member and the
      Notes to be transferred consist of Physical Notes which after transfer are
      to be evidenced by an interest in the IAI Global Note or Regulation S
      Global Note, as the case may be, upon receipt by the Registrar of (x)
      written instructions given in accordance with the Depositary's and the
      Registrar's procedures and (y) the appropriate certificate, if any,
      required by clause (y) of paragraph (i) above, the Registrar shall
      register the transfer and reflect on its books and records the date and an
      increase in the principal amount of the IAI Global Note or Regulation S
      Global Note, as to case may be, in an amount equal to the principal amount
      of Physical Notes to be transferred, and the Trustee shall cancel the
      Physical Notes so transferred; and

                  (iii) if the proposed transferor is an Agent Member seeking to
      transfer an interest in a Global Note, upon receipt by the Registrar of
      (x) written instructions given in accordance with the Depositary's and the
      Registrar's procedures and (y) the appropriate certificate, if any,
      required by clause (y) of paragraph (i) above, the Registrar shall
      register the transfer and reflect on its books and records the date and
      (A) a decrease in the principal amount of the Global Note from which such
      interests are to be transferred in an amount equal to the principal amount
      of the Notes to be transferred and (B) an increase in the principal amount
      of the IAI Global Note or the Regulation S Global Note, as the case may
      be, in an amount equal to the principal amount of the Notes to be
      transferred.

            (b)   TRANSFERS TO QIBS.  The following provisions shall apply
with respect to the registration of any proposed transfer of a Note
constituting a Restricted Security to a QIB (excluding transfers to
Non-U.S. Persons):

                  (i) the Registrar shall register the transfer of any
      Restricted Security if such transfer is being made by a proposed
      transferor who has checked the box provided for on the form of Note
      stating, or has otherwise advised LNR and the Registrar in writing, that
      the sale has been made in compliance with the provisions of Rule 144A to a
      transferee who has signed the certification provided for on the form of
      Note stating, or has otherwise advised LNR and the Registrar in writing,
      that it is purchasing the Note for its own account or an account with
      respect to which it exercises sole investment discretion and that it and
      any such account is a QIB within the meaning of Rule 144A, and is aware
      that the sale to it is being made in reliance on Rule 144A and
      acknowledges that it has received such information regarding LNR as it has
      requested pursuant to Rule 144A or has determined not to request such
      information and that it is aware that the


                                      -28-
<PAGE>
      transferor is relying upon its foregoing representations in order to claim
      the exemption from registration provided by Rule 144A; and

                  (ii) if the proposed transferee is an Agent Member, and the
      Notes to be transferred consist of Physical Notes which after transfer are
      to be evidenced by an interest in a Global Note, upon receipt by the
      Registrar of written instructions given in accordance with the
      Depositary's and the Registrar's procedures, the Registrar shall reflect
      on its books and records the date and an increase in the principal amount
      of such Global Note in an amount equal to the principal amount of the
      Physical Notes to be transferred, and the Trustee shall cancel the
      Physical Notes so transferred; and

                  (iii) if the proposed transferor is an Agent Member seeking to
      transfer an interest in the IAI Global Note or the Regulation S Global
      Note, upon receipt by the Registrar of written instructions given in
      accordance with the Depositary's and the Registrar's procedures, the
      Registrar shall register the transfer and reflect on its books and records
      the date and (A) a decrease in the principal amount of the IAI Global Note
      or the Regulation S Global Note, as the case may be, in an amount equal to
      the principal amount of the Notes to be transferred and (B) an increase in
      the principal amount of the Global Note in an amount equal to the
      principal amount of the Notes to be transferred.

            (c) RESTRICTIONS ON TRANSFER AND EXCHANGE OF GLOBAL NOTES.
Notwithstanding any other provisions of this Indenture, a Global Note may not be
transferred as a whole except by the Depositary to a nominee of the Depositary
or by a nominee of the Depositary to the Depositary or any such nominee to a
successor Depositary or a nominee of such successor Depositary.

            (d) PRIVATE PLACEMENT LEGEND. Upon the transfer, exchange or
replacement of Notes not bearing the Private Placement Legend, the Registrar
shall deliver Notes that do not bear the Private Placement Legend. Upon the
transfer, exchange or replacement of Notes bearing the Private Placement Legend,
the Registrar shall deliver only Notes that bear the Private Placement Legend
unless (i) the requested transfer is after the second anniversary of the Issue
Date (PROVIDED, HOWEVER, that neither LNR nor any Affiliate of LNR has held any
beneficial interest in such Note, or portion thereof, or any predecessor
security at any time prior to or on the second anniversary of the Issue Date
(or, in the case of any Initial Notes issued after the Issue Date, two years
after the date of initial issuance thereof), or (ii) there is delivered to the
Registrar an Opinion of Counsel reasonably satisfactory to LNR and the Trustee
to the effect that neither such legend nor the related restrictions on transfer
are required in order to maintain compliance with the provisions of the
Securities Act.

            (e) GENERAL. By its acceptance of any Note bearing the Private
Placement Legend, each Holder of such a Note acknowledges the restrictions on
transfer of such Note set forth in this Indenture and in the Private Placement
Legend and agrees that it will transfer such Note only as provided in this
Indenture.

            The Registrar shall retain copies of all letters, notices and other
written communications received pursuant to SECTION 2.16 or this SECTION 2.17.
LNR shall have the right to inspect and make copies of all such letters, notices
or other written communications at


                                      -29-
<PAGE>
any reasonable time during the Registrar's normal business hours upon the giving
of reasonable written notice to the Registrar.

            (f) TRANSFER OF NOTES HELD BY AFFILIATES. Any certificate (i)
evidencing a Note that has been transferred to an Affiliate of LNR within two
years after the Issue Date (or in the case of any Initial Notes issued after the
Issue Date, two years after the date of initial issuance thereof), as evidenced
by a notation on the Assignment Form for such transfer or in the representation
letter delivered in respect thereof or (ii) evidencing a Note that has been
acquired from an Affiliate of LNR (other than by an Affiliate of LNR) in a
transaction or a chain of transactions not involving any public offering, shall,
until two years after the last date on which LNR or any Affiliate of LNR was an
owner of such Note, in each case, bear the Private Placement Legend, unless
otherwise agreed by LNR (with written notice thereof to the Trustee).

            (g) NOTICE OF AFFILIATE PURCHASES. In connection with the purchase
or sale of any Note or any beneficial interest therein by LNR or any Affiliate
thereof (other than a sale to the Initial Purchasers pursuant to the Purchase
Agreement), LNR shall file with the Trustee and Registrar a written notice
identifying the transaction as such for the purposes hereof.

SECTION 2.18.     ADDITIONAL INTEREST UNDER REGISTRATION RIGHTS AGREEMENT.

            Under certain circumstances, LNR shall be obligated to pay
Additional Interest to the Holders, all as set forth in SECTION 4 of the
Registration Rights Agreement. The terms thereof are hereby incorporated herein
by reference.

                                  ARTICLE III.

                                   REDEMPTION

SECTION 3.1.      NOTICES TO TRUSTEE.

            If LNR elects to redeem Notes pursuant to Paragraph 5 of the Notes,
it shall notify the Trustee and the Paying Agent in writing of the Redemption
Date and the principal amount of the Notes to be redeemed.

            LNR shall give each notice provided for in this SECTION 3.1 to the
Trustee at least 45 days before the Redemption Date (unless a shorter notice
period shall be satisfactory to the Trustee for its administrative convenience,
as evidenced in a writing signed on behalf of the Trustee), together with an
Officers' Certificate stating that such redemption shall comply with the
conditions contained herein and in the Notes. Any such notice may be canceled at
any time prior to notice of such redemption being mailed to any Holder and shall
thereby be void and of no effect.

SECTION 3.2.      SELECTION OF NOTES TO BE REDEEMED.

            In the event that less than all of the Notes are to be redeemed at
any time, selection of such Notes for redemption will be made by the Trustee in
compliance with the requirements of the principal national securities exchange,
if any, on which such Notes are listed or, if such Notes are not then listed on
a national securities exchange, by lot, on a PRO RATA basis


                                      -30-
<PAGE>
or by such method as the Trustee shall deem fair and appropriate; PROVIDED,
HOWEVER, that no Notes of a principal amount of $1,000 or less shall be redeemed
in part; PROVIDED, FURTHER, that if a partial redemption is made with the
proceeds of a Public Equity Offering, selection of the Notes or portions thereof
for redemption shall be made by the Trustee only on a PRO RATA basis or on as
nearly a PRO RATA basis as is practicable (subject to Depositary procedures),
unless such method is otherwise prohibited.

SECTION 3.3.      OPTIONAL REDEMPTION.

            The Notes will be redeemable, at LNR's option, in whole or in part
at any time, or from time to time, on or after October 15, 2008, upon not less
than 30 nor more than 60 days' notice to the Holders, at the following
Redemption Prices (expressed as percentages of the principal amount thereof) if
redeemed during the twelve-month period commencing on October 15 of the years
set forth below, plus, in each case, accrued and unpaid interest thereon, if
any, to the Redemption Date:

<TABLE>
<CAPTION>
            Year                                                  Percentage
            ----                                                  ----------
<S>                                                               <C>
            2008.............................................     103.625%
            2009.............................................     102.417%
            2010.............................................     101.208%
            2011 and thereafter..............................     100.000%
</TABLE>


            Notwithstanding the foregoing, at any time, or from time to time, on
or prior to October 15, 2006, LNR may, at its option, redeem, with the net cash
proceeds of one or more Public Equity Offerings, up to 35% of the aggregate
principal amount of the Notes issued and sold by LNR at a Redemption Price equal
to 107.25% of the principal amount thereof, plus accrued interest thereon, if
any, to the Redemption Date; PROVIDED that at least 65% of the aggregate
principal amount of the Notes issued and sold by LNR remain outstanding
immediately following such redemption. In order to effect the foregoing
redemption with the proceeds of any Public Equity Offering, LNR shall make such
redemption not more than 60 days after the consummation of any such Public
Equity Offering.

SECTION 3.4.      NOTICE OF REDEMPTION.

            At least 30 days but not more than 60 days before a Redemption Date,
LNR shall mail or cause to be mailed a notice of redemption by first-class mail
to each Holder of Notes to be redeemed at its registered address, with a copy to
the Trustee and any Paying Agent. At LNR's request, the Trustee shall give the
notice of redemption in LNR's name and at LNR's expense. LNR shall provide such
notices of redemption to the Trustee at least five days before the intended
mailing date.

            Each notice of redemption shall identify (including the CUSIP
number) the Notes to be redeemed and shall state:

            (1) the Redemption Date;


                                      -31-
<PAGE>
            (2) the Redemption Price and the amount of accrued interest, if any,
to be paid;

            (3) the name and address of the Paying Agent;

            (4) the subparagraph of the Notes pursuant to which such redemption
is being made;

            (5) that Notes called for redemption must be surrendered to the
Paying Agent to collect the Redemption Price plus accrued interest, if any;

            (6) that, unless LNR defaults in depositing the Redemption Price
with the Paying Agent pursuant to Section 3.6, interest on Notes or applicable
portions thereof called for redemption will cease to accrue on and after the
Redemption Date, and the only remaining right of the Holders of such Notes will
be to receive payment of the Redemption Price plus accrued interest as of the
Redemption Date, if any, upon surrender to the Paying Agent of the Notes
redeemed;

            (7) if any Note is being redeemed in part, the portion of the
principal amount of such Note to be redeemed and that, after the Redemption
Date, and upon surrender of such Note, a new Note or Notes in the aggregate
principal amount equal to the unredeemed portion thereof will be issued; and

            (8) if fewer than all the Notes are to be redeemed, the
identification of the particular Notes (or portions thereof) to be redeemed, as
well as the aggregate principal amount of Notes to be redeemed and the aggregate
principal amount of Notes to be outstanding after such partial redemption.

            LNR will comply with the requirements of Rule 14e-1 under the
Exchange Act and any other securities laws and regulations thereunder to the
extent such laws and regulations are applicable in connection with the purchase
of Notes.

SECTION 3.5.      EFFECT OF NOTICE DEFECT.

            Once notice of redemption is mailed in accordance with SECTION 3.4,
such notice of redemption shall be irrevocable and Notes called for redemption
shall become due and payable on the Redemption Date and at the Redemption Price
plus accrued interest as of such date, if any. Upon surrender to the Trustee or
Paying Agent, such Notes called for redemption shall be paid at the Redemption
Price plus accrued interest thereon to the Redemption Date, but installments of
interest, the maturity of which is on or prior to the Redemption Date, shall be
payable to Holders of record at the close of business on the relevant record
dates referred to in the NOTES. Interest shall cease to accrue on or after the
Redemption Date unless LNR defaults in payment of the Redemption Price.

SECTION 3.6.      DEPOSIT OF REDEMPTION PRICE.

            On or before the Redemption Date and in accordance with SECTION
2.14, LNR shall deposit with the Paying Agent U.S. Legal Tender sufficient to
pay the Redemption Price


                                      -32-
<PAGE>
plus accrued interest, if any, of all Notes to be redeemed on that date. The
Paying Agent shall promptly return to LNR any U.S. Legal Tender so deposited
which is not required for that purpose, except with respect to monies owed as
obligations to the Trustee pursuant to ARTICLE VII.

            Unless LNR fails to comply with the preceding paragraph and defaults
in the payment of such Redemption Price plus accrued interest, if any, interest
on the Notes to be redeemed will cease to accrue on and after the applicable
Redemption Date, whether or not such Notes are presented for payment.

SECTION 3.7.      NOTES REDEEMED IN PART.

            Upon surrender of a Note that is to be redeemed in part, the Trustee
shall authenticate for the Holder a new Note or Notes equal in principal amount
to the unredeemed portion of the Note surrendered.

                                   ARTICLE IV.

                                    COVENANTS

SECTION 4.1.      PAYMENT OF NOTES.

            (a) LNR shall pay the principal of, premium, if any, and interest on
the Notes on the dates and in the manner provided in the Notes and in this
Indenture.

            (b) An installment of principal of or interest on the Notes shall be
considered paid on the date it is due if the Trustee or Paying Agent (other than
LNR or any of its Affiliates) holds, prior to 11:00 a.m. New York City time on
that date, U.S. Legal Tender designated for and sufficient to pay the
installment in full and is not prohibited from paying such money to the Holders
pursuant to the terms of this Indenture or the Notes.

            (c) Notwithstanding anything to the contrary contained in this
Indenture, LNR may, to the extent it is required to do so by law, deduct or
withhold income or other similar taxes imposed by the United States of America
from payments hereunder.

SECTION 4.2.      MAINTENANCE OF OFFICE OR AGENCY.

            LNR shall maintain the office or agency required under SECTION 2.3.
LNR shall give prior written notice to the Trustee of the location, and any
change in the location, of such office or agency. If at any time LNR shall fail
to maintain any such required office or agency or shall fail to furnish the
Trustee with the address thereof, such presentations, surrenders, notices and
demands may be made or served at the address of the Trustee set forth in SECTION
11.2.

SECTION 4.3.      CORPORATE EXISTENCE.

            Except as otherwise permitted by ARTICLE V, LNR shall do or cause to
be done, at its own cost and expense, all things necessary to preserve and keep
in full force and effect its corporate existence and the corporate existence of
each of its Subsidiaries in accordance with the


                                      -33-
<PAGE>
respective organizational documents of each such Subsidiary and the material
rights (charter and statutory) and franchises of LNR and each such Subsidiary;
PROVIDED, HOWEVER, that LNR shall not be required to preserve, with respect to
itself, any material right or franchise and, with respect to any of its
Subsidiaries, any such existence, material right or franchise, if the Board of
Directors of LNR shall determine in good faith that the preservation thereof is
no longer desirable in the conduct of the business of LNR and its Subsidiaries,
taken as a whole.

SECTION 4.4.      PAYMENT OF TAXES AND OTHER CLAIMS.

            LNR shall pay or discharge or cause to be paid or discharged, before
the same shall become delinquent, (i) all material taxes, assessments and
governmental charges (including withholding taxes and any penalties, interest
and additions to taxes) levied or imposed upon it or any of its Subsidiaries or
properties of it or any of its Subsidiaries and (ii) all material lawful claims
for labor, materials and supplies that, if unpaid, might by law become a Lien
upon the property of LNR or any of its Subsidiaries; PROVIDED, HOWEVER, that LNR
shall not be required to pay or discharge or cause to be paid or discharged any
such tax, assessment, charge or claim whose amount, applicability or validity is
being contested in good faith by appropriate negotiations or proceedings
properly instituted and diligently conducted for which adequate reserves, to the
extent required under GAAP, have been taken.

SECTION 4.5.      MAINTENANCE OF PROPERTIES AND INSURANCE.

            (a) LNR shall, and shall cause each of the Subsidiaries to, maintain
all properties used or useful in the conduct of its business in good working
order and condition (subject to ordinary wear and tear) and make all necessary
repairs, renewals, replacements, additions, betterments and improvements thereto
and actively conduct and carry on its business; PROVIDED, HOWEVER, that nothing
in this SECTION 4.5 shall prevent LNR or any of the Subsidiaries of LNR from
discontinuing the operation and maintenance of any of its properties, if such
discontinuance is (i) in the ordinary course of business pursuant to customary
business terms or (ii) in the good faith judgment of the respective Boards of
Directors or other governing body of LNR or such Subsidiary, as the case may be,
desirable in the conduct of their respective businesses and is not
disadvantageous in any material respect to the Holders.

            (b) LNR shall provide or cause to be provided, for itself and each
of the Subsidiaries of LNR, insurance (including appropriate self-insurance)
against loss or damage of the kinds that, in the good faith judgment of LNR, are
adequate and appropriate for the conduct of the business of LNR and its
Subsidiaries in a prudent manner, with reputable insurers.

SECTION 4.6.      COMPLIANCE CERTIFICATE; NOTICE OF DEFAULT.

            (a) LNR shall deliver to the Trustee, within 90 days after the end
of each of LNR's fiscal years, an Officers' Certificate (PROVIDED, HOWEVER, that
one of the signatories to each such Officers' Certificate shall be LNR's
principal executive officer, principal financial officer or principal accounting
officer), as to such Officers' knowledge, of LNR's compliance with all
conditions and covenants under this Indenture (without regard to any period of
grace or requirement of notice provided hereunder) and in the event any Default
exists, such Officers


                                      -34-
<PAGE>
shall specify the nature of such Default. Each such Officers' Certificate shall
also notify the Trustee of any change in LNR's fiscal year-end.

            (b) So long as not contrary to the then current recommendations of
the American Institute of Certified Public Accountants, the annual financial
statements delivered pursuant to SECTION 4.8 shall be accompanied by a written
report of LNR's independent certified public accountants (who shall be a firm of
established national reputation) stating (A) that their audit examination has
included a review of the terms of this Indenture and the form of the Notes as
they relate to accounting matters, and (B) whether, in connection with their
audit examination, any Default or Event of Default has come to their attention
and if such a Default or Event of Default has come to their attention,
specifying the nature and period of existence thereof; PROVIDED, HOWEVER, that,
without any restriction as to the scope of the audit examination, such
independent certified public accountants shall not be liable by reason of any
failure to obtain knowledge of any such Default or Event of Default that would
not be disclosed in the course of an audit examination conducted in accordance
with generally accepted auditing standards.

            (c) (i) If any Default or Event of Default has occurred and is
continuing or (ii) if any Holder seeks to exercise any remedy hereunder with
respect to a claimed Default under this Indenture or the Notes, LNR shall
deliver to the Trustee, at its address set forth in SECTION 11.2, by registered
or certified mail or by facsimile transmission followed by hard copy by
registered or certified mail an Officers' Certificate specifying such event,
notice or other action promptly upon LNR's becoming aware of such occurrence.

SECTION 4.7.      COMPLIANCE WITH LAWS.

            LNR shall comply, and shall cause each of its Subsidiaries to
comply, with all applicable statutes, rules, regulations, orders and
restrictions of the United States of America, all states and municipalities
thereof, and of any governmental department, commission, board, regulatory
authority, bureau, agency and instrumentality of the foregoing, in respect of
the conduct of their respective businesses and the ownership of their respective
properties, except for such noncompliances as could not singly or in the
aggregate reasonably be expected to have a material adverse effect on the
financial condition or results of operations of LNR and its Subsidiaries taken
as a whole.

SECTION 4.8.      COMMISSION REPORTS.

            (a) LNR shall file with the Commission all information, documents
and reports to be filed with the Commission pursuant to Section 13 or 15(d) of
the Exchange Act, whether or not LNR is subject to such filing requirements so
long as the Commission will accept such filings. LNR (at its own expense) shall
deliver to the Trustee within 15 days after it files them with the Commission,
copies of the quarterly and annual reports and of the information, documents and
other reports (or copies of such portions of any of the foregoing as the SEC may
by rules and regulations prescribe) which LNR files with the Commission pursuant
to Section 13 or 15(d) of the Exchange Act. Upon qualification of this Indenture
under the TIA, LNR shall also comply with the provisions of TIA Section 314(a).
Delivery of such reports, information and documents to the Trustee is for
informational purposes only and the Trustee's receipt of such shall not
constitute constructive notice of any information contained therein or
determinable


                                      -35-
<PAGE>
from information contained therein, including LNR's compliance with any of its
covenants hereunder (as to which the Trustee is entitled to rely exclusively on
Officers' Certificates).

            (b) At LNR's expense, regardless of whether LNR is required to
furnish such reports to its stockholders pursuant to the Exchange Act, LNR shall
cause an annual report and each quarterly or other financial report to be
delivered to the Trustee and the Trustee will mail them to the Holders at their
addresses appearing in the registration books of the Registrar.

            (c) LNR shall, upon request, provide to any Holder or any
prospective transferee of any such Holder any information concerning LNR
(including financial statements) necessary in order to permit such Holder to
sell or transfer Notes in compliance with Rule 144A.

SECTION 4.9.      WAIVER OF STAY, EXTENSION OR USURY LAWS.

            LNR covenants (to the extent that it may lawfully do so) that it
will not at any time insist upon, plead, or in any manner whatsoever claim or
take the benefit or advantage of, any stay or extension law or any usury law or
other law that would prohibit or forgive LNR from paying all or any portion of
the Obligations on the Notes as contemplated herein, wherever enacted, now or at
any time hereafter in force, or which may affect the covenants or the
performance of this Indenture; and (to the extent that it may lawfully do so)
LNR hereby expressly waives all benefit or advantage of any such law, and
covenants that it will not hinder, delay or impede the execution of any power
herein granted to the Trustee, but will suffer and permit the execution of every
such power as though no such law had been enacted.

SECTION 4.10.     LIMITATION ON RESTRICTED PAYMENTS.

            LNR shall not, and shall not cause or permit any of its Subsidiaries
to, directly or indirectly:

                  (a) declare or pay any dividend or make any distribution
      (other than dividends or distributions made to LNR or any Subsidiary of
      LNR and, if such Subsidiary is not a Wholly Owned Subsidiary, to such
      Subsidiary's other stockholders or interest holders on a PRO RATA basis,
      and other than any dividend or distribution payable solely in Qualified
      Capital Stock of LNR) on or in respect of shares of LNR's Capital Stock to
      holders of such Capital Stock;

                  (b) purchase, redeem or otherwise acquire or retire for value
      any Capital Stock of LNR or any warrants, rights or options to purchase or
      acquire shares of any class of such Capital Stock (other than the exchange
      of such Capital Stock or any warrants, rights or options to acquire shares
      of any class of Capital Stock of LNR for Qualified Capital Stock of LNR);
      or

                  (c) make any principal payment on, purchase, defease, redeem,
      prepay, decrease or otherwise acquire or retire for value, prior to any
      scheduled final maturity, scheduled repayment or scheduled sinking fund
      payment, any Indebtedness of LNR or a Subsidiary that is subordinate or
      junior in right of payment to the Notes or any guarantee thereof


                                      -36-
<PAGE>
(each of the foregoing actions set forth in clauses (a), (b) and (c) being
referred to as a "RESTRICTED PAYMENT"), if at the time of such Restricted
Payment or immediately after giving effect thereto,

            (i) a Default or an Event of Default shall have occurred and
be continuing or

            (ii) LNR is not able to incur at least $1.00 of additional
Indebtedness (other than additional Permitted Indebtedness) in compliance with
SECTION 4.12, or

            (iii) the aggregate amount of all Restricted Payments (including
such proposed Restricted Payment) made subsequent to the Base Date (the amount
expended for such purposes, if other than in cash, being the fair market value
of such property as determined reasonably and in good faith by the Board of
Directors of LNR) shall exceed the sum of:

                  (A) 50% of the cumulative Consolidated Net Income (or if
            cumulative Consolidated Net Income shall be a loss, minus 100% of
            such loss) of LNR earned during the period beginning on the first
            day of the fiscal quarter including the Base Date and ending on the
            last day of the most recent fiscal quarter ending at least 30 days
            prior to the date the Restricted Payment occurs (the "REFERENCE
            DATE") (treating such period as a single accounting period); PLUS

                  (B) 100% of the aggregate net cash proceeds received by LNR
            from the issuance and sale to any Person (other than a Subsidiary of
            LNR) subsequent to the Base Date and on or prior to the Reference
            Date of Qualified Capital Stock of LNR, including treasury stock;
            PLUS

                  (C) without duplication of any amounts included in clause (B)
            above, 100% of the aggregate net cash proceeds of any equity
            contribution received by LNR from a holder of LNR's Capital Stock
            subsequent to the Base Date and on or prior to the Reference Date
            (excluding, in the case of clauses (B) and (C), any net cash
            proceeds from a Public Equity Offering to the extent used to redeem
            the Notes); PLUS

                  (D) $75,000,000.

            Notwithstanding the foregoing, the provisions set forth above in
SECTION 4.10 shall not prohibit:

                  (1) the payment of any dividend or the consummation of any
            irrevocable redemption within 60 days after the date of declaration
            of such dividend or the giving of such irrevocable redemption notice
            if the dividend or redemption would have been permitted on the date
            of declaration or giving of irrevocable redemption notice;

                  (2) if no Default or Event of Default shall have occurred and
            be continuing, the acquisition of any shares of Capital Stock of
            LNR, either (i) solely in exchange for shares of Qualified Capital
            Stock of LNR or (ii) through the application of net


                                      -37-
<PAGE>
            proceeds of a substantially concurrent sale for cash (other than to
            a Subsidiary of LNR) of shares of Qualified Capital Stock of LNR;

                  (3) if no Default or Event of Default shall have occurred and
            be continuing, the acquisition of any Indebtedness of LNR that is
            subordinate or junior in right of payment to the Notes either (i)
            solely in exchange for shares of Qualified Capital Stock of LNR, or
            (ii) through the application of net proceeds of a substantially
            concurrent sale for cash (other than to a Subsidiary of LNR) of (A)
            shares of Qualified Capital Stock of LNR or (B) Refinancing
            Indebtedness; and

                  (4) if no Default or Event of Default shall have occurred and
            be continuing, the repurchase of shares of, or options to purchase
            shares of, Common Stock of LNR from employees, former employees,
            directors or former directors of LNR pursuant to the terms of the
            agreements or plans approved by the Board of Directors of LNR under
            which such individuals purchased or sold, or were granted the option
            to purchase or sell shares of Common Stock), PROVIDED, HOWEVER, that
            the aggregate amount of such repurchases or Restricted Payments
            shall not exceed $250,000 any calendar year.

            In determining the aggregate amount of Restricted Payments made
subsequent to the Base Date in accordance with clause (iii) of this SECTION
4.10, amounts expended pursuant to clauses (1), (2)(ii) and (3)(ii)(A) shall be
included in such calculation.

            Not later than three Business Days before making any Restricted
Payment, LNR shall deliver to the Trustee an Officers' Certificate stating that
such Restricted Payment complies with this Indenture and setting forth in
reasonable detail the basis upon which the required calculations were computed.

SECTION 4.11.     LIMITATION ON TRANSACTIONS WITH AFFILIATES.

            (a) LNR shall not, and shall not cause or permit any of its
Subsidiaries to, directly or indirectly, enter into or permit to exist any
transaction or series of related transactions (including, without limitation,
the purchase, sale, lease or exchange of any property or the rendering of any
service) with, or for the benefit of, any of its Affiliates (each an "AFFILIATE
TRANSACTION"), other than (x) Permitted Affiliate Transactions and (y) Affiliate
Transactions on terms that are no less favorable to LNR or such Subsidiary than
those that might reasonably have been obtained or are obtainable in a comparable
transaction at such time on an arm's-length basis from a Person that is not an
Affiliate of LNR or such Subsidiary. All Affiliate Transactions (and each series
of related Affiliate Transactions which are similar or part of a common plan),
other than Permitted Affiliate Transactions, involving aggregate payments or
other property with a fair market value in excess of $5.0 million must be
approved by the Board of Directors of LNR (or, in the case of transactions with
Lennar Corporation, or any of its Subsidiaries, by a committee of the Board of
Directors of LNR composed entirely of directors who are not officers or
directors of Lennar Corporation, or any of its Subsidiaries,) or the Board of
Directors of LNR's Subsidiary, as the case may be. Such Board of Director's
approval is to be evidenced by a Board Resolution stating that such Board of
Directors (including a majority of the directors who do not have any interest in
the Affiliate Transaction) has determined that such transaction complies with
the


                                      -38-
<PAGE>
foregoing provisions. In addition, if LNR or any Subsidiary of LNR enters into
an Affiliate Transaction (or a series of related Affiliate Transactions related
to a common plan), other than Permitted Affiliate Transactions, involving
aggregate payments or other property with a fair market value in excess of $7.5
million, LNR or such Subsidiary, as the case may be, shall, prior to the
consummation of that transaction or transactions, obtain a favorable opinion as
to the fairness of such transaction or transactions to LNR or the relevant
Subsidiary, as the case may be, from a financial point of view, from an
Independent Financial Advisor, except that a fairness opinion will not be
required for Additional Partnership Transactions between LNR or any of LNR's
Subsidiaries and Lennar Corporation, or any of its Subsidiaries, that in the
aggregate involve payments or other property with a fair market value of $50
million or less during the entire period that Notes are outstanding.

            (b) The restrictions set forth in paragraph (a) of this SECTION 4.11
shall not apply to (each of the following actions set forth in clauses (i),
(ii), (iii), (iv) and (v) being referred to as a "PERMITTED AFFILIATE
TRANSACTION"):

            (i) reasonable fees and compensation paid to and indemnity provided
on behalf of, officers, directors, employees, consultants or agents of LNR or
any Subsidiary of LNR as determined in good faith by LNR's Board of Directors or
senior management;

            (ii) transactions between or among LNR and any of its Wholly Owned
Subsidiaries or between or among such Wholly Owned Subsidiaries PROVIDED such
transactions are not otherwise prohibited under this Indenture;

            (iii) any agreement as in effect as of the Base Date or any
amendment thereto or any transaction contemplated thereby (including pursuant to
any amendment thereto) or in any replacement agreement thereto so long as any
such amendment or replacement agreement is not more disadvantageous to the
Holders in any material respect than the original agreement as in effect on the
Base Date;

            (iv) Restricted Payments permitted by this Indenture; and

            (v) transactions between or among LNR or any Subsidiaries of LNR and
a Land Partnership, PROVIDED such transactions are permitted by and are effected
in accordance with the terms of the partnership agreement or other similar
agreement, of such Land Partnership and the By-laws of LNR, in each case, as in
effect on the Issue Date, except that:

                  (1) if at any time when transactions between or among LNR or
      any of its Subsidiaries and NWHL Investment LLC (and its successors or
      assigns) are subject to the covenants regarding Affiliate Transactions,
      under the indenture dated July 2, 2003 relating to LNR's 7.625% Senior
      Subordinated Notes due 2013, and are not excluded from those covenants as
      Permitted Affiliate Transactions, those transactions will not be excluded
      as Permitted Affiliate Transactions from the covenants in the Indenture,
      and

                  (2) if at any time LNR makes payments to the holders of the
      7.625% Senior Subordinated Notes due 2013 to induce them to consent to an
      amendment, waiver or modification of the indenture relating to the 7.625%
      Senior Subordinated Notes due 2013 that causes transactions between or
      among LNR or any of its Subsidiaries and


                                      -39-
<PAGE>
      NWHL Investment LLC (and its successors or assigns) to be Permitted
      Affiliate Transactions under that indenture or otherwise not to be subject
      to the covenants in that indenture regarding Affiliate Transactions, LNR
      will make to holders of the Notes the same payment per $1,000 principal
      amount of Notes that LNR makes per $1,000 principal amount of 7.625%
      Senior Subordinated Notes due 2013 to holders of the 7.625% Senior
      Subordinated Notes due 2013 who consent to the amendment, waiver or
      modification.

SECTION 4.12.     LIMITATION ON INCURRENCE OF ADDITIONAL INDEBTEDNESS.

            LNR shall not, and shall not cause or permit any of its Subsidiaries
to, directly or indirectly, create, incur, assume, guarantee, acquire, become
liable, contingently or otherwise, with respect to, or otherwise become
responsible for payment of (collectively, "INCUR"), any Indebtedness (including,
without limitation, Acquired Indebtedness and any additional Initial Notes in
excess of $300,000,000 aggregate principal amount outstanding) other than
Permitted Indebtedness. Notwithstanding the foregoing, if no Default or Event of
Default shall have occurred and be continuing at the time of or as a consequence
of the incurrence of any such Indebtedness, LNR and its Subsidiaries may incur
Indebtedness (including, without limitation, Acquired Indebtedness and any such
additional Initial Notes in excess of $300,000,000 aggregate principal amount
outstanding) if on the date of the incurrence of such Indebtedness, after giving
effect to the incurrence thereof:

            (i) the Consolidated Fixed Charge Coverage Ratio of LNR is greater
      than 1.5 to 1.0;

            (ii) the ratio of the aggregate amount of Recourse Indebtedness
      outstanding on a consolidated basis to the Consolidated Net Worth of LNR
      is less than 5.0 to 1.0; and

            (iii) the ratio of the aggregate amount of Senior Recourse
      Indebtedness outstanding on a consolidated basis to the sum of (A) the
      Consolidated Net Worth of LNR and (B) the aggregate amount of the
      Subordinated Indebtedness outstanding on a consolidated basis is less than
      2.75 to 1.0 , provided, that such Subordinated Indebtedness included in
      this calculation is not in excess of the Consolidated Net Worth of LNR.

            No Indebtedness incurred pursuant to the second sentence of this
SECTION 4.12 shall be included in calculating any limitation set forth in the
definition of Permitted Indebtedness. Neither the accrual of interest nor the
accretion of original issue discount shall be deemed an incurrence of
Indebtedness. Prior to any incurrence of Indebtedness pursuant to the second
sentence of this SECTION 4.12 (other than an advance under a committed
facility), LNR shall deliver to the Trustee an Officers' Certificate setting
forth the calculations by which such incurrence was determined to be permitted.
If, during any month, LNR incurs Indebtedness pursuant to the second sentence of
this SECTION 4.12 through advances under a committed facility, LNR shall deliver
to the Trustee on the last day of such month an Officers' Certificate setting
forth the calculations by which each such incurrence was determined to be
permitted.


                                      -40-
<PAGE>
SECTION 4.13.     LIMITATION ON DIVIDEND AND OTHER PAYMENT RESTRICTIONS
                  AFFECTING SUBSIDIARIES.

            LNR shall not, and shall not cause or permit any of its Subsidiaries
to, directly or indirectly, create or otherwise cause or permit to exist or
become effective any encumbrance or restriction on the ability of any Subsidiary
of LNR to (a) pay dividends or make any other distributions on or in respect of
its Capital Stock; (b) make loans or advances or pay any Indebtedness or other
obligation owed to LNR or any other Subsidiary of LNR; or (c) transfer any of
its property or assets to LNR or any other Subsidiary of LNR, except for such
encumbrances or restrictions existing under or by reason of:

                  (1) applicable law;

                  (2) this Indenture;

                  (3) the Credit Agreement;

                  (4) nonassignment provisions of any contract or any lease
      governing a leasehold interest of any Subsidiary of LNR;

                  (5) any instrument governing Acquired Indebtedness, which
      encumbrance or restriction is not applicable to any Person, or the
      properties or assets of any Person, other than the Person or the
      properties or assets of the Person so acquired;

                  (6) agreements existing on the Base Date to the extent and in
      the manner such agreements were in effect on the Base Date;

                  (7) restrictions on the transfer of assets subject to any Lien
      permitted under this Indenture to secure Non-Recourse Indebtedness imposed
      by the holder of such Lien;

                  (8) restrictions imposed by any agreement to sell assets
      permitted under this Indenture to any Person pending the closing of such
      sale;

                  (9) any agreement or instrument governing Capital Stock of any
      Person that is acquired; or

                  (10) an agreement governing Indebtedness incurred to Refinance
      the Indebtedness issued, assumed or incurred pursuant to an agreement
      referred to in clause (2), (3), (5) or (6) above, PROVIDED, HOWEVER, that
      the provisions relating to such encumbrance or restriction contained in
      any such Indebtedness incurred to Refinance the Indebtedness are not less
      favorable to LNR in any material respect as determined by the Board of
      Directors of LNR in their reasonable and good faith judgment than the
      provisions relating to such encumbrance or restriction contained in
      agreements referred to in such clause (2), (3), (5) or (6), respectively.


                                      -41-
<PAGE>
SECTION 4.14.     CHANGE OF CONTROL.

            (a) Upon the occurrence of a Change of Control, each Holder will
have the right to require that LNR purchase all or a portion of such Holder's
Notes pursuant to the offer described below (the "CHANGE OF CONTROL OFFER"), at
a purchase price equal to 101% of the principal amount thereof plus accrued and
unpaid interest to the date of purchase.

            (b) Within 30 days following the date upon which a Change of Control
occurs, LNR shall send, by first class mail, a notice to each Holder at such
Holder's last registered address, with a copy to the Trustee provided at least 5
days prior to such mailing, which notice shall govern the terms of the Change of
Control Offer. Such notice shall state:

                  (i) that the Change of Control Offer is being made pursuant to
      this SECTION 4.14, that all Notes tendered and not withdrawn will be
      accepted for payment and that the Change of Control Offer shall remain
      open for a period of 20 Business Days or such longer period as may be
      required by law;

                  (ii) the purchase price (including the amount of accrued
      interest) and the purchase date (which shall be no earlier than 30 days
      nor later than 45 days from the date such notice is mailed, other than as
      may be required by law) (the "CHANGE OF CONTROL PAYMENT DATE");

                  (iii) that any Note not tendered will continue to accrue
      interest;

                  (iv) that, unless LNR defaults in making payment therefor, any
      Note accepted for payment pursuant to the Change of Control Offer shall
      cease to accrue interest after the Change of Control Payment Date;

                  (v) that Holders electing to have a Note purchased pursuant to
      a Change of Control Offer will be required to surrender the Note, with the
      form entitled "Option of Holder to Elect Purchase" on the reverse of the
      Note completed, to the Paying Agent at the address specified in the notice
      prior to the close of business on the third Business Day prior to the
      Change of Control Payment Date;

                  (vi) that Holders will be entitled to withdraw their election
      if the Paying Agent receives, not later than the second Business Day prior
      to the Change of Control Payment Date, a telegram, telex, facsimile
      transmission or letter setting forth the name of the Holder, the principal
      amount of the Notes the Holder delivered for purchase and a statement that
      such Holder is withdrawing its election to have such Notes purchased;

                  (vii) that Holders whose Notes are purchased only in part will
      be issued new Notes in a principal amount equal to the unpurchased portion
      of the Notes surrendered; PROVIDED, HOWEVER, that each Note purchased and
      each new Note issued shall be in an original principal amount of $1,000 or
      integral multiples thereof; and

                  (viii) the circumstances and relevant facts regarding such
      Change of Control.


                                      -42-
<PAGE>
            (c) In connection with any Change of Control, LNR shall within 30
days following any Change of Control, (i) obtain the consents under the Credit
Agreement and all other Senior Indebtedness required to permit the repurchase of
the Notes pursuant to a Change of Control Offer or (ii) repay in full all
Indebtedness, and terminate all commitments, under the Credit Agreement and all
other Senior Indebtedness the terms of which would prohibit the purchase of the
Notes pursuant to a Change of Control Offer.

            (d) On or before the Change of Control Payment Date, LNR shall (i)
accept for payment Notes or portions thereof tendered pursuant to the Change of
Control Offer, (ii) deposit with the Paying Agent in accordance with SECTION
2.14 U.S. Legal Tender sufficient to pay the purchase price plus accrued
interest, if any, of all Notes so tendered and (iii) deliver to the Trustee
Notes so accepted together with an Officers' Certificate stating the Notes or
portions thereof being purchased by LNR. Upon receipt by the Paying Agent of the
monies specified in clause (ii) of the next preceding sentence and a copy of the
Officers' Certificate specified in clause (iii) of such sentence, the Paying
Agent shall promptly mail to the Holders of Notes so accepted payment in an
amount equal to the purchase price plus accrued interest, if any, and the
Trustee shall promptly authenticate and mail to such Holders new Notes equal in
principal amount to any unpurchased portion of the Notes surrendered. For
purposes of this SECTION 4.14, the Trustee shall act as the Paying Agent.

            (e) Neither the Board of Directors of LNR nor the Trustee may waive
the provisions of this SECTION 4.14 relating to LNR's obligation to repurchase
Notes upon a Change of Control.

            (f) LNR will comply with the requirements of Rule 14e-1 under the
Exchange Act and any other securities laws and regulations thereunder to the
extent such laws and regulations are applicable in connection with the
repurchase of Notes pursuant to a Change of Control Offer. To the extent that
the provisions of any securities laws or regulations conflict with the
provisions of this SECTION 4.14, LNR shall comply with the applicable securities
laws and regulations and shall not be deemed to have breached its obligations
under the provisions of this SECTION 4.14 by virtue thereof.

            (g) Notwithstanding anything herein to the contrary, LNR shall not
be required to make a Change of Control Offer upon a Change of Control if a
third party makes the Change of Control Offer in the manner, at the time and
otherwise in compliance with the requirements of this SECTION 4.14 applicable to
a Change of Control Offer made by LNR and purchases all Notes validly tendered
and not withdrawn under such Change of Control Offer.

SECTION 4.15.     LIMITATION ON PREFERRED STOCK OF SUBSIDIARIES.

            LNR shall not permit any of its Subsidiaries to issue any Preferred
Stock (other than to LNR or to a Wholly Owned Subsidiary of LNR) or permit any
Person (other than LNR or a Wholly Owned Subsidiary of LNR) to own any Preferred
Stock of any Subsidiary of LNR.

SECTION 4.16.     LIMITATION ON LIENS AND GUARANTEES.

            LNR shall not, and shall not cause or permit any of its Subsidiaries
to, directly or indirectly, create, incur, assume or permit or suffer to exist
any Liens securing Indebtedness of


                                      -43-
<PAGE>
LNR that is expressly subordinate or junior in right of payment to the Notes or
is PARI PASSU in right of payment to Notes against or upon any property or
assets of LNR or any of its Subsidiaries (whether owned on the Issue Date or
acquired after the Issue Date), or any proceeds therefrom, or assign or
otherwise convey any right to receive income or profits therefrom, or grant any
guarantees of any such Indebtedness, unless (i) in the case of Liens securing
Indebtedness of LNR that is expressly subordinate or junior in right of payment
to the Notes, the Notes are secured by a Lien on such property, assets or
proceeds that is senior in priority to such Liens, (ii) in case of guarantees of
Indebtedness of LNR that is expressly subordinate or junior in right of payment
to the Notes, the Notes are subject to a guarantee from the same guarantor or
guarantors that is senior in priority to such guarantees and (iii) in all other
cases, the Notes are equally and ratably secured or guaranteed as applicable.

            For purposes of clarification, (i) any Lien against property,
assets, proceeds or rights to receive income or profits securing Indebtedness
which has been guaranteed will be considered to be a Lien securing the
Indebtedness and not a Lien securing the guarantee and (ii) the legal or
covenant defeasance of any Indebtedness of LNR that is expressly subordinated or
junior in right of payment or is equal in right of payment to the Notes shall
not be deemed to involve a Lien securing such Indebtedness so long as such
defeasance is not prohibited under the terms of SECTION 4.10.

SECTION 4.17.     CONDUCT OF BUSINESS.

            LNR shall, and shall cause its Subsidiaries to, engage primarily in
the businesses of acquiring, developing, selling, owning, managing, operating,
leasing, credit enhancing and insuring commercial and multi-family residential
real estate, real estate related lending, acquiring, owning, servicing and
collecting real estate related loans and other underperforming debt securities,
investing in real estate related securities and securities of companies engaged
primarily in real estate related activities, and other activities related to or
arising out of any of those activities.

SECTION 4.18.     PROHIBITION ON INCURRENCE OF SENIOR SUBORDINATED DEBT.

            LNR shall not incur or suffer to exist Indebtedness that by its
terms (or by the terms of any agreement governing such Indebtedness) is senior
in right of payment to the Notes and expressly subordinate in right of payment
to any other Indebtedness of LNR.

                                   ARTICLE V.

                              SUCCESSOR CORPORATION

SECTION 5.1.      MERGER, CONSOLIDATION AND SALE OF ASSETS.

            (a) LNR shall not, in a single transaction or series of related
transactions, consolidate or merge with or into any Person, or sell, assign,
transfer, lease, convey or otherwise dispose of all or substantially all of
LNR's assets (determined on a consolidated basis for LNR and its Subsidiaries)
unless: (i) either (1) LNR shall be the surviving or continuing corporation or
(2) the Person (if other than LNR) formed by such consolidation or into which
LNR is merged or the Person which acquires by sale, assignment, transfer, lease,
conveyance or other disposition the properties and assets of LNR and its
Subsidiaries substantially as an entirety (the "SURVIVING


                                      -44-
<PAGE>
ENTITY") (x) shall be a corporation organized and validly existing under the
laws of the United States or any State thereof or the District of Columbia and
(y) shall expressly assume, by supplemental indenture (in form and substance
satisfactory to the Trustee), executed and delivered to the Trustee, the due and
punctual payment of the principal of, premium, if any, and interest on all of
the Notes and the performance of every covenant of the Notes, this Indenture and
the Registration Rights Agreement on the part of LNR to be performed or
observed, as the case may be; (ii) immediately after giving effect to such
transaction and the assumption contemplated by clause (i)(2)(y) above (including
giving effect to any Indebtedness and Acquired Indebtedness incurred or
anticipated to be incurred in connection with or in respect of such
transaction), LNR or such Surviving Entity, as the case may be, (1) shall have a
Consolidated Net Worth equal to or greater than the Consolidated Net Worth of
LNR immediately prior to such transaction and (2) shall be able to incur at
least $1.00 of additional Indebtedness (other than additional Permitted
Indebtedness) pursuant to SECTION 4.12; (iii) immediately before and immediately
after giving effect to such transaction and the assumption contemplated by
clause (i)(2)(y) above (including, without limitation, giving effect to any
Indebtedness and Acquired Indebtedness incurred or anticipated to be incurred
and any Lien granted in connection with or in respect of the transaction), no
Default or Event of Default shall have occurred or be continuing; and (iv) LNR
or the Surviving Entity, as the case may be, shall have delivered to the Trustee
an Officers' Certificate and an Opinion of Counsel, each stating that such
consolidation, merger, sale, assignment, transfer, lease, conveyance or other
disposition and, if a supplemental indenture is required in connection with such
transaction, such supplemental indenture comply with the applicable provisions
of this Indenture and that all conditions precedent in this Indenture relating
to such transaction have been satisfied.

            (b) For purposes of the foregoing, the transfer (by lease,
assignment, sale or otherwise, in a single transaction or series of
transactions) of all or substantially all of the properties or assets of one or
more Subsidiaries of LNR, the Capital Stock of which constitutes all or
substantially all of the properties and assets of LNR shall be deemed to be the
transfer of all or substantially all of the properties and assets of LNR.

SECTION 5.2.      SUCCESSOR CORPORATION SUBSTITUTED.

            Upon any consolidation, combination or merger or any transfer of all
or substantially all of the assets of LNR in accordance with SECTION 5.1, the
successor Person formed by such consolidation or into which LNR is merged or to
which such conveyance, lease or transfer is made shall (upon the required
assumption described in SECTION 5.1) succeed to, and be substituted for, and may
exercise every right and power of, LNR under this Indenture and the Notes with
the same effect as if such successor had been named as LNR herein and thereafter
(except in the case of a lease) the predecessor corporation will be relieved of
all further obligations and covenants under this Indenture and the Notes.


                                      -45-
<PAGE>
                                   ARTICLE VI.

                                    REMEDIES

SECTION 6.1.      EVENTS OF DEFAULT.

            An "EVENT OF DEFAULT" means any of the following events:

                  (i) the failure to pay interest (including Additional
      Interest, if any) on any Notes when the same becomes due and payable and
      the default continues for a period of 30 days, whether or not such failure
      shall be due to compliance with ARTICLE X of this Indenture or agreements
      with respect to any other Indebtedness or any other reason;

                  (ii) the failure to pay the principal on any Notes, when such
      principal becomes due and payable, at maturity, upon acceleration, upon
      redemption or otherwise (including the failure to make a Change of Control
      Offer or make a payment to purchase Notes tendered pursuant to a Change of
      Control Offer), whether or not such failure shall be due to compliance
      with ARTICLE X of this Indenture or agreements with respect to any other
      Indebtedness or any other reason;

                  (iii) a default in the observance or performance of any other
      covenant or agreement contained in this Indenture which default continues
      for a period of 30 days after LNR receives written notice specifying the
      default (and demanding that such default be remedied) from the Trustee or
      the Holders of at least 25% of the outstanding principal amount of the
      Notes (except in the case of a default with respect to SECTION 5.1, which
      will constitute an Event of Default with such notice requirement but
      without such passage of time requirement);

                  (iv) the failure to pay at final maturity (giving effect to
      any applicable grace periods and any extensions thereof) the principal
      amount of any Recourse Indebtedness of LNR or any Subsidiary of LNR, or
      the acceleration of the final stated maturity of any such Recourse
      Indebtedness if the aggregate principal amount of such Recourse
      Indebtedness, together with the principal amount of any other such
      Recourse Indebtedness in default for failure to pay principal at final
      maturity or which has been accelerated, aggregates $5.0 million or more at
      any time;

                  (v) one or more judgments in an aggregate amount in excess of
      $5.0 million shall have been rendered against LNR or any of its
      Subsidiaries and remain undischarged, unpaid or unstayed for a period of
      60 days after such judgment or judgments become final and nonappealable.

                  (vi) LNR or any of its Subsidiaries pursuant to or under or
      within the meaning of any Bankruptcy Law:

            (a)   commences a voluntary case or proceeding;

            (b)   consents to the entry of an order for relief against it in an
                  involuntary case or proceeding;


                                      -46-
<PAGE>
            (c)   consents to the appointment of a Custodian of it or for all or
                  substantially all of its property;

            (d)   makes a general assignment for the benefit of its creditors;
                  or

            (e)   shall generally not pay its debts when such debts become due
                  or shall admit in writing its inability to pay its debts
                  generally; or

                  (vii) a court of competent jurisdiction enters an order or
      decree under any Bankruptcy Law that:

            (a)   is for relief against LNR or any Subsidiary of LNR in an
                  involuntary case or proceeding,

            (b)   appoints a Custodian of LNR or any Subsidiary of LNR for all
                  or substantially all of its Properties, or

            (c)   orders the liquidation of LNR or any Subsidiary of LNR.

      and in each case the order or decree remains unstayed and in effect for 60
      consecutive days.

            The Events of Default described in clauses (iv), (v), (vi) and (vii)
above with respect to a Subsidiary shall not apply if such Person was not a
Subsidiary at the time such event or condition occurred unless, in the case of
clause (iv) or (v) above, LNR or another Subsidiary thereof assumes or otherwise
becomes liable for the liability referred to therein or the liabilities
generally of such Person.

SECTION 6.2.      ACCELERATION.

            (a) If an Event of Default (other than an Event of Default specified
in clause (vi) or (vii) of SECTION 6.1) shall occur and be continuing, the
Trustee or the Holders of at least 25% in principal amount of outstanding Notes
may declare the principal of and accrued interest on all the Notes to be due and
payable by notice in writing to LNR and, if such notice is given by Holders, the
Trustee specifying the respective Event of Default and that it is a "notice of
acceleration" (the "ACCELERATION NOTICE"), and the same (i) shall become
immediately due and payable or (ii) if there are any amounts outstanding under
the Credit Agreement, shall become immediately due and payable upon the first to
occur of an acceleration under the Credit Agreement or 5 Business Days after
receipt by LNR and the Representative under the Credit Agreement of such
Acceleration Notice but only if such Event of Default is then continuing. If an
Event of Default specified in clause (vi) or (vii) of SECTION 6.1 occurs and is
continuing with respect to LNR, then all unpaid Obligations on all of the
outstanding Notes shall IPSO FACTO become and be immediately due and payable
without any declaration or other act on the part of the Trustee or any Holder.

            (b) At any time after a declaration of acceleration with respect to
the Notes as described in the preceding paragraph, the Holders of a majority in
aggregate principal amount of the Notes may rescind and cancel such declaration
and its consequences (i) if the rescission

                                      -47-
<PAGE>
would not conflict with any judgment or decree, (ii) if all existing Events of
Default have been cured or waived except nonpayment of principal or interest
that has become due solely because of such acceleration, (iii) if interest on
overdue installments of interest (to the extent the payment of such interest is
lawful) and on overdue principal, which has become due otherwise than by such
declaration of acceleration, has been paid, (iv) if LNR has paid the Trustee its
reasonable compensation and reimbursed the Trustee for its expenses,
disbursements and advances and (v) in the event of the cure or waiver of an
Event of Default of the type described in clause (iv) of SECTION 6.1, the
Trustee shall have received an Officers' Certificate and an Opinion of Counsel
that such Event of Default has been cured or waived. No such rescission shall
affect any subsequent Default or impair any right consequent thereto.

SECTION 6.3.      OTHER REMEDIES.

            If an Event of Default occurs and is continuing, the Trustee may
pursue any available remedy by proceeding at law or in equity to collect the
payment of the principal of, premium, if any, or interest on the Notes or to
enforce the performance of any provision of the Notes or this Indenture.

            All rights of action and claims under this Indenture or the Notes
may be enforced by the Trustee even if it does not possess any of the Notes or
does not produce any of them in the proceeding. A delay or omission by the
Trustee or any Holder in exercising any right or remedy accruing upon an Event
of Default shall not impair the right or remedy or constitute a waiver of or
acquiescence in the Event of Default. No remedy is exclusive of any other
remedy. All available remedies are cumulative to the extent permitted by law.

SECTION 6.4.      WAIVER OF PAST DEFAULTS.

            Prior to the declaration of acceleration of the Notes, the Holders
of not less than a majority in aggregate principal amount of the Notes then
outstanding by notice to the Trustee may, on behalf of the Holders of all the
Notes, waive any existing Default or Event of Default and its consequences under
this Indenture, except a Default or Event of Default specified in clause (i) or
(ii) of SECTION 6.1 or in respect of any provision hereof which cannot be
modified or amended without the consent of the Holder so affected pursuant to
SECTION 9.2. When a Default or Event of Default is so waived, it shall be deemed
cured and shall cease to exist. This SECTION 6.4 shall be in lieu of Section
316(a)(1)(B) of the TIA and such Section 316(a)(1)(B) of the TIA is hereby
expressly excluded from this Indenture and the Notes, as permitted by the TIA.

SECTION 6.5.      CONTROL BY MAJORITY.

            Subject to SECTION 2.9, the Holders of the Notes may not enforce
this Indenture or the Notes except as provided in this ARTICLE VI and under the
TIA. The Holders of not less than a majority in aggregate principal amount of
the outstanding Notes shall have the right to direct the time, method and place
of conducting any proceeding for any remedy available to the Trustee, or
exercising any trust or power conferred on the Trustee, PROVIDED, HOWEVER, that
the Trustee may refuse to follow any direction (a) that conflicts with any rule
of law or this Indenture, (b) that the Trustee determines may be unduly
prejudicial to the rights of another Holder, or (c) that may expose the Trustee
to personal liability for which reasonable indemnity

                                      -48-
<PAGE>
provided to the Trustee against such liability shall be inadequate; PROVIDED,
FURTHER, that the Trustee may take any other action deemed proper by the Trustee
that is not inconsistent with such direction or this Indenture. This SECTION 6.5
shall be in lieu of Section 316(a)(1)(A) of the TIA, and such Section
316(a)(1)(A) of the TIA is hereby expressly excluded from this Indenture and the
Notes, as permitted by the TIA.

SECTION 6.6.      LIMITATION ON SUITS.

            No Holder of any Notes shall have any right to institute any
proceeding with respect to this Indenture or the Notes or any remedy hereunder,
unless the Holders of at least 25% in aggregate principal amount of the
outstanding Notes have made written request, and offered reasonable indemnity,
to the Trustee to institute such proceeding as Trustee under the Notes and this
Indenture, the Trustee has failed to institute such proceeding within 25 days
after receipt of such notice, request and offer of indemnity and the Trustee,
within such 25-day period, has not received directions inconsistent with such
written request by Holders of not less than a majority in aggregate principal
amount of the outstanding Notes.

            The foregoing limitations shall not apply to a suit instituted by a
Holder of a Note for the enforcement of the payment of the principal of,
premium, if any, or interest on, such Note on or after the respective due dates
expressed or provided for in such Note.

            A Holder may not use this Indenture to prejudice the rights of any
other Holders or to obtain priority or preference over such other Holders.

SECTION 6.7.      RIGHT OF HOLDERS TO RECEIVE PAYMENT.

            Notwithstanding any other provision in this Indenture, the right of
any Holder of a Note to receive payment of the principal of, premium, if any,
and interest on such Note, on or after the respective due dates expressed or
provided for in such Note, or to bring suit for the enforcement of any such
payment on or after the respective due dates, is absolute and unconditional and
shall not be impaired or affected without the consent of the Holder.

SECTION 6.8.      COLLECTION SUIT BY TRUSTEE.

            If an Event of Default specified in clause (i) or (ii) of SECTION
6.1 occurs and is continuing, the Trustee may recover judgment in its own name
and as trustee of an express trust against LNR, or any other obligor on the
Notes for the whole amount of the principal of, premium, if any, and accrued
interest remaining unpaid, together with interest on overdue principal and, to
the extent that payment of such interest is lawful, interest on overdue
installments of interest, in each case at the rate per annum provided for by the
Notes and such further amount as shall be sufficient to cover the costs and
expenses of collection, including the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel.

SECTION 6.9.      TRUSTEE MAY FILE PROOFS OF CLAIM.

            The Trustee may file such proofs of claim and other papers or
documents as may be necessary or advisable in order to have the claims of the
Trustee (including any claim for the

                                      -49-
<PAGE>
reasonable compensation, expenses, disbursements and advances of the Trustee,
its agents, counsel, accountants and experts) and the Holders allowed in any
judicial proceedings relative to LNR or Subsidiaries (or any other obligor upon
the Notes), their creditors or their property and shall be entitled and
empowered to collect and receive any monies or other property payable or
deliverable on any such claims and to distribute the same, and any Custodian in
any such judicial proceedings is hereby authorized by each Holder to make such
payments to the Trustee and, in the event that the Trustee shall consent to the
making of such payments directly to the Holders, to pay to the Trustee any
amount due to it for the reasonable compensation, expenses, disbursements and
advances of the Trustee, its agent and counsel, and any other amounts due the
Trustee under SECTION 7.7. LNR's payment obligations under this SECTION 6.9
shall be secured in accordance with the provisions of SECTION 7.7. Nothing
herein contained shall be deemed to authorize the Trustee to authorize or
consent to or accept or adopt on behalf of any Holder any plan of
reorganization, arrangement, adjustment or composition affecting the Notes or
the rights of any Holder thereof, or to authorize the Trustee to vote in respect
of the claim of any Holder in any such proceeding.

SECTION 6.10.     PRIORITIES.

            If the Trustee collects any money pursuant to this ARTICLE VI it
shall pay out such money, subject to the provisions of ARTICLE X, in the
following order:

            First:  to the Trustee for amounts due under SECTION 7.7;

            Second: to Holders for interest accrued on the Notes, ratably,
      without preference or priority of any kind, according to the amounts due
      and payable on the Notes for interest;

            Third: to Holders for the principal amounts (including any premium)
      owing under the Notes, ratably, without preference or priority of any
      kind, according to the amounts due and payable on the Notes for the
      principal (including any premium); and

            Fourth:  the balance, if any, to LNR.

The Trustee, upon prior written notice to LNR, may fix a record date and payment
date for any payment to Holders pursuant to this SECTION 6.10.

SECTION 6.11.     UNDERTAKING FOR COSTS.

            In any suit for the enforcement of any right or remedy under this
Indenture or in any suit against the Trustee for any action taken or omitted by
it as Trustee, a court may in its discretion require the filing by any party
litigant in the suit of an undertaking to pay the costs of the suit, and the
court in its discretion may assess reasonable costs, including reasonable
attorneys' fees, against any party litigant in the suit, having due regard to
the merits and good faith of the claims or defenses made by the party litigant.
This SECTION 6.11 does not apply to any suit by the Trustee, any suit by a
Holder pursuant to SECTION 6.7, or a suit by a Holder or Holders of more than
10% in aggregate principal amount of the outstanding Notes.


                                      -50-
<PAGE>
SECTION 6.12.     RESTORATION OF RIGHTS AND REMEDIES.

            If the Trustee or any Holder has instituted any proceeding to
enforce any right or remedy under this Indenture or any Note and such proceeding
has been discontinued or abandoned for any reason, or has been determined
adversely to the Trustee or to such Holder, then and in every such case LNR, the
Trustee and the Holders shall, subject to any determination in such proceeding,
be restored severally and respectively to their former positions hereunder, and
thereafter all rights and remedies of the Trustee and the Holders shall continue
as though no such proceeding had been instituted.

                                  ARTICLE VII.

                                     TRUSTEE

SECTION 7.1.      DUTIES OF TRUSTEE.

            (a) If an Event of Default has occurred and is continuing, the
Trustee shall exercise such of the rights and powers vested in it by this
Indenture and shall use the same degree of care and skill in its exercise
thereof as a prudent man or woman would exercise or use under the circumstances
in the conduct of his or her own affairs.

            (b) Except during the continuance of an Event of Default:

            (1) The Trustee need perform only those duties as are specifically
      set forth in this Indenture and no duties, covenants or obligations of the
      Trustee shall be implied in this Indenture.

            (2) In the absence of bad faith on its part, the Trustee may
      conclusively rely, as to the truth of the statements and the correctness
      of the opinions expressed therein, upon certificates or opinions furnished
      to the Trustee and conforming to the requirements of this Indenture.
      However, in the case of any such certificates or opinions that by any
      provision hereof are specifically required to be furnished to the Trustee,
      the Trustee shall examine the certificates and opinions to determine
      whether or not they conform to the requirements of this Indenture.

            (c) Notwithstanding anything to the contrary herein contained, the
Trustee may not be relieved from liability for its own negligent action, its own
negligent failure to act, or its own willful misconduct, except that:

            (1) This paragraph does not limit the effect of paragraph (b) of
      this SECTION 7.1.

            (2) The Trustee shall not be liable for any error of judgment made
      in good faith by a Trust Officer, unless it is proved that the Trustee was
      negligent in ascertaining the pertinent facts.


                                      -51-
<PAGE>
            (3) The Trustee shall not be liable with respect to any action it
      takes or omits to take in good faith in accordance with a direction
      received by it pursuant to SECTION 6.2, 6.4 OR 6.5.

            (d) No provision of this Indenture shall require the Trustee to
expend or risk its own funds or otherwise incur any financial liability, in the
performance of any of its duties hereunder or in the exercise of any of its
rights or powers if it shall have reasonable grounds for believing that
repayment of such funds or adequate indemnity against such risk or liability is
not reasonably assured to it.

            (e) Every provision of this Indenture that in any way relates to the
Trustee is subject to paragraphs (a), (b), (c) and (d) of this SECTION 7.1 AND
SECTION 7.2.

            (f) The Trustee shall not be liable for interest on any money or
assets received by it except as the Trustee may agree in writing with LNR.
Assets held in trust by the Trustee need not be segregated from other assets
except to the extent required by law.

            (g) The Trustee may refuse to perform any duty or exercise any right
or power hereunder unless (i) it is provided adequate funds to enable it to do
so and (ii) it receives indemnity reasonably satisfactory to it against any
loss, liability, fee or expense.

SECTION 7.2.      RIGHTS OF TRUSTEE.

            Subject to SECTION 7.1:

            (a) The Trustee may rely and shall be fully protected in acting or
refraining from acting upon any document believed by it to be genuine and to
have been signed or presented by the proper Person. The Trustee need not and
shall not be required to investigate any fact or matter stated in the document.

            (b) Before the Trustee acts or refrains from acting, it may consult
with counsel of its selection and may require an Officers' Certificate or an
Opinion of Counsel, or both, which shall conform to SECTIONS 11.4 AND 11.5. The
Trustee shall not be liable for any action it takes or omits to take in good
faith in reliance on such Officers' Certificate or Opinion of Counsel.

            (c) The Trustee may act through its attorneys and agents and shall
not be responsible for the misconduct or negligence of any agent appointed with
due care.

            (d) The Trustee shall not be liable for any action that it takes or
omits to take in good faith which it reasonably believes to be authorized or
within its rights or powers.

            (e) The Trustee shall not be bound to make any investigation into
the facts or matters stated in any resolution, certificate, statement,
instrument, opinion, notice, request, direction, consent, order, bond,
debenture, or other paper or document, but the Trustee, in its discretion, may
make such further inquiry or investigation into such facts or matters as it may
see fit, and, if the Trustee shall determine to make such further inquiry or
investigation, it shall be entitled, upon reasonable notice to LNR, to examine
the books, records, and premises of LNR,

                                      -52-
<PAGE>
personally or by agent or attorney and to consult with the officers and
representatives of LNR, including LNR's accountants and attorneys.

            (f) The Trustee shall be under no obligation to exercise any of the
rights or powers vested in it by this Indenture at the request, order or
direction of any of the Holders pursuant to the provisions of this Indenture,
unless such Holders shall have offered to the Trustee security or indemnity
reasonably satisfactory to the Trustee against the costs, expenses and
liabilities which may be incurred by it in compliance with such request, order
or direction.

            (g) The Trustee shall not be required to give any bond or surety in
respect of the performance of its powers and duties hereunder.

            (h) Delivery of reports, information and documents to the Trustee
under SECTION 4.8 is for informational purposes only and the Trustee's receipt
of the foregoing shall not constitute constructive notice of any information
contained therein or determinable from information contained therein, including
LNR's compliance with any of its covenants hereunder (as to which the Trustee is
entitled to rely exclusively on Officers' Certificates).

SECTION 7.3.      INDIVIDUAL RIGHTS OF TRUSTEE.

            The Trustee in its individual or any other capacity may become the
owner or pledgee of Notes and may otherwise deal with LNR, any of its
Subsidiaries, or their respective Affiliates with the same rights it would have
if it were not Trustee. Any Agent may do the same with like rights. However, the
Trustee must comply with SECTIONS 7.10 AND 7.11.

SECTION 7.4.      TRUSTEE'S DISCLAIMER.

            The Trustee shall not be responsible for and makes no representation
as to the validity or adequacy of this Indenture or the Notes, and it shall not
be accountable for LNR's use of the proceeds from the Notes, and it shall not be
responsible for any statement of LNR in this Indenture or any document entered
into or issued in connection with the issuance and sale of the Notes or any
statement in the Notes other than the Trustee's certificate of authentication.

SECTION 7.5.      NOTICE OF DEFAULT.

            If a Default or an Event of Default occurs and is continuing and if
it is known to a Trust Officer, the Trustee shall mail to each Holder notice of
the uncured Default or Event of Default within 90 days after obtaining knowledge
thereof. Except in the case of a Default or an Event of Default in payment of
principal of, or premium, if any, or interest on, any Note, including an
accelerated payment, a Default in payment on the Change of Control Payment Date
pursuant to a Change of Control Offer or a Default in compliance with ARTICLE V
hereof, the Trustee may withhold the notice if and so long as its Board of
Directors, the executive committee of its Board of Directors or a committee of
its directors and/or Trust Officers in good faith determines that withholding
the notice is in the interest of the Holders. The foregoing sentence of this
SECTION 7.5 shall be in lieu of the proviso to Section 315(b) of the TIA and
such proviso to Section 315(b) of the TIA is hereby expressly excluded from this
Indenture and the Notes, as permitted by the TIA.


                                      -53-
<PAGE>
SECTION 7.6.      REPORTS BY TRUSTEE TO HOLDERS.

            Within 60 days after December 31 of each year beginning with 2003,
the Trustee shall, to the extent that any of the events described in TIA Section
313(a) occurred within the previous twelve months, but not otherwise, mail to
each Holder a brief report dated as of such date that complies with TIA Section
313(a). The Trustee also shall comply with TIA Sections 313(b), (c) and (d).

            A copy of each report at the time of its mailing to Holders shall be
mailed to LNR and filed with the Commission and each stock exchange, if any, on
which the Notes are listed.

            LNR shall promptly notify the Trustee if the Notes become listed on
any stock exchange and the Trustee shall comply with TIA Section 313(d).

SECTION 7.7.      COMPENSATION AND INDEMNITY.

            LNR shall pay to the Trustee from time to time such compensation for
its services as has been agreed to in writing signed by LNR and the Trustee. The
Trustee's compensation shall not be limited by any law on compensation of a
trustee of an express trust. LNR shall reimburse the Trustee upon request for
all reasonable out-of-pocket disbursements, advances or expenses incurred or
made by it in connection with the performance of its duties under this
Indenture. Such expenses shall include the reasonable fees and expenses of the
Trustee's agents, counsel, accountants and experts.

            LNR shall indemnify each of the Trustee (or any predecessor Trustee)
and its agents, employees, stockholders, Affiliates and directors and officers
for, and hold them each harmless against, any and all loss, liability, damage,
claim or expense (including reasonable fees and expenses of counsel), including
taxes (other than taxes based on the income of the Trustee) incurred by any of
them except for such actions to the extent caused by any negligence, bad faith
or willful misconduct on their part, arising out of or in connection with the
acceptance or administration of this trust including the reasonable costs and
expenses of defending themselves against any claim or liability in connection
with the exercise or performance of any of their rights, powers or duties
hereunder. The Trustee shall notify LNR promptly of any claim asserted against
the Trustee for which it may seek indemnity, PROVIDED, HOWEVER, that failure to
so notify LNR shall not release LNR of its obligations hereunder unless, and
then only to the extent, such failure results in the forfeiture by LNR of
substantial rights and defenses. At the Trustee's sole discretion, LNR shall
defend the claim and the Trustee shall cooperate and may participate in the
defense; provided, HOWEVER, that any settlement of a claim shall be approved in
writing by the Trustee if such settlement would result in an admission of
liability by the Trustee or if such settlement would not be accompanied by a
full release of the Trustee for all liability arising out of the events giving
rise to such claim. Alternatively, the Trustee may at its option have separate
counsel of its own choosing and LNR shall pay the reasonable fees and expenses
of such counsel.

            To secure LNR's payment obligations in this SECTION 7.7, the Trustee
shall have a lien prior to the Notes on all assets or money held or collected by
the Trustee, in its capacity as Trustee, except assets or money held in trust to
pay principal of or premium, if any, or interest on particular Notes.


                                      -54-
<PAGE>
            When the Trustee incurs expenses or renders services after an Event
of Default specified in SECTION 6.1(VI) OR (VII) occurs, such expenses and the
compensation for such services are intended to constitute expenses of
administration under any Bankruptcy Law.

            The provisions of this SECTION 7.7 shall survive the termination of
this Indenture.

SECTION 7.8.      REPLACEMENT OF TRUSTEE.

            The Trustee may resign at any time by so notifying LNR in writing at
least 30 days in advance of such resignation; PROVIDED, HOWEVER, that no such
resignation shall be effective until a successor Trustee has accepted its
appointment pursuant to this SECTION 7.8. The Holders of a majority in principal
amount of the outstanding Notes may remove the Trustee and appoint a successor
Trustee with LNR's consent, by so notifying LNR and the Trustee. LNR may remove
the Trustee if:

            (1) the Trustee fails to comply with SECTION 7.10;

            (2) the Trustee is adjudged bankrupt or insolvent or an order for
      relief is entered with respect to the Trustee under any Bankruptcy Law;

            (3) a receiver or other public officer takes charge of the Trustee
      or its property; or

            (4)   the Trustee becomes incapable of acting.

            If the Trustee resigns or is removed or if a vacancy exists in the
office of Trustee for any reason, LNR shall notify each Holder of such event and
shall promptly appoint a successor Trustee. Within one year after the successor
Trustee takes office, the Holders of a majority in aggregate principal amount of
the outstanding Notes may appoint a successor Trustee to replace the successor
Trustee appointed by LNR.

            A successor Trustee shall deliver a written acceptance of its
appointment to the retiring Trustee and to LNR. Immediately after that, the
retiring Trustee shall transfer all property held by it as Trustee to the
successor Trustee, subject to the lien provided in SECTION 7.7, the resignation
or removal of the retiring Trustee shall become effective, and the successor
Trustee shall have all the rights, powers and duties of the Trustee under this
Indenture. The successor Trustee shall mail notice of such successor Trustee's
appointment to each Holder.

            If a successor Trustee does not take office within 60 days after the
retiring Trustee resigns or is removed, the retiring Trustee, LNR or the Holders
of at least 10% in aggregate principal amount of the outstanding Notes may
petition any court of competent jurisdiction for the appointment of a successor
Trustee.

            If the Trustee fails to comply with SECTION 7.10, any Holder may
petition any court of competent jurisdiction for the removal of the Trustee and
the appointment of a successor Trustee.


                                      -55-
<PAGE>
            Notwithstanding any resignation or replacement of the Trustee
pursuant to this SECTION 7.8, LNR's obligations under SECTION 7.7 shall continue
for the benefit of the retiring Trustee.

SECTION 7.9.      SUCCESSOR TRUSTEE BY MERGER, ETC.

            If the Trustee consolidates with, merges or converts into, or
transfers all or substantially all of its corporate trust business to, another
corporation, the resulting, surviving or transferee corporation without any
further act shall, if such resulting, surviving or transferee corporation is
otherwise eligible hereunder, be the successor Trustee; PROVIDED, HOWEVER, that
such corporation shall be otherwise qualified and eligible under this ARTICLE
VII.

SECTION 7.10.     ELIGIBILITY; DISQUALIFICATION.

            This Indenture shall always have a Trustee who satisfies the
requirement of TIA Sections 310(a)(1), (2) and (5). The Trustee (or, in the case
of a Trustee that is a corporation included in a bank holding company system,
the related bank holding company) shall have a combined capital and surplus of
at least $100 million as set forth in its most recent published annual report of
condition, and have a Corporate Trust Office in the City of New York. In
addition, if the Trustee is a corporation included in a bank holding company
system, the Trustee, independently of such bank holding company, shall meet the
capital requirements of TIA Section 310(a)(2). The Trustee shall comply with TIA
Section 310(b); PROVIDED, HOWEVER, that there shall be excluded from the
operation of TIA Section 310(b)(1) any indenture or indentures under which other
securities, or certificates of interest or participation in other securities, of
LNR are outstanding, if the requirements for such exclusion set forth in TIA
Section 310(b)(1) are met. The provisions of TIA Section 310 shall apply to LNR,
as obligor of the Notes.

SECTION 7.11.     PREFERENTIAL COLLECTION OF CLAIMS AGAINST LNR.

            The Trustee shall comply with TIA Section 311(a), excluding any
creditor relationship listed in TIA Section 311(b). A Trustee who has resigned
or been removed shall be subject to TIA Section 311(a) to the extent indicated
therein. The provisions of TIA Section 311 shall apply to LNR, as obligor of the
Notes.

                                  ARTICLE VIII.

                       DISCHARGE OF INDENTURE; DEFEASANCE

SECTION 8.1.      TERMINATION OF OBLIGATIONS.

            This Indenture shall be discharged and shall cease to be of further
effect (except as to surviving rights or registration of transfer or exchange of
the Notes, as expressly provided for in this Indenture) as to all outstanding
Notes when:

            (i) either (a) all the Notes theretofore authenticated and delivered
(except lost, stolen or destroyed Notes which have been replaced or paid and
Notes for whose payment money has theretofore been deposited in trust or
segregated and held in trust by LNR and thereafter repaid to LNR or discharged
from such trust) have been delivered to the Trustee for cancellation or (b) all


                                      -56-
<PAGE>
Notes not theretofore delivered to the Trustee for cancellation have become due
and payable and LNR has irrevocably deposited or caused to be deposited with the
Trustee funds in an amount sufficient to pay and discharge the entire
Indebtedness on the Notes not theretofore delivered to the Trustee for
cancellation, for principal of, premium, if any, and interest on the Notes to
the date of deposit together with irrevocable instructions from LNR directing
the Trustee to apply such funds to the payment thereof;

            (ii) LNR has paid all other sums payable under this Indenture by
LNR; and

            (iii) LNR has delivered to the Trustee an Officers' Certificate and
an Opinion of Counsel stating that all conditions precedent under this Indenture
relating to the satisfaction and discharge of this Indenture have been complied
with.

            LNR may, at its option and at any time, elect to have its
obligations discharged with respect to the outstanding Notes ("LEGAL
DEFEASANCE"). As a result of such Legal Defeasance, LNR shall be deemed to have
paid and discharged the entire Indebtedness represented by the outstanding
Notes, except for (i) the rights of Holders to receive payments in respect of
the principal of, premium, if any, and interest on the Notes when such payments
are due, (ii) LNR's obligations with respect to the Notes concerning issuing
temporary Notes, registration, transfer and exchange of Notes, replacement of
mutilated, destroyed, lost or stolen Notes and the maintenance of an office or
agency for payments, (iii) the rights, powers, trust, duties and immunities of
the Trustee and LNR's obligations in connection therewith and (iv) the Legal
Defeasance provisions of this SECTION 8.1. In addition, LNR may, at its option
and at any time, elect to have the obligations of LNR released with respect to
SECTIONS 4.10 THROUGH 4.18 AND ARTICLE V ("COVENANT DEFEASANCE") and thereafter
any omission to comply with such obligations shall not constitute a Default or
Event of Default with respect to the Notes. In the event of Covenant Defeasance,
those events described under SECTION 6.1 (except those events described in
SECTION 6.1(I),(II) (but including matters relating to a Change of Control
Offer),(VI) AND (VII)) will no longer constitute an Event of Default with
respect to the Notes.

            In order to exercise Legal Defeasance or Covenant Defeasance:

            (1) LNR must irrevocably deposit with the Trustee, in trust, for the
      benefit of the Holders U.S. Legal Tender, noncallable United States
      Government Obligations, or a combination thereof, in such amounts as will
      be sufficient without reinvestment, in the opinion of a nationally
      recognized firm of independent public accountants addressed to the
      Trustee, to pay the principal of, premium, if any, and interest on the
      Notes on the stated dates for payment thereof or on the applicable
      Redemption Date, as the case may be;

            (2) LNR shall have delivered to the Trustee an Opinion of Counsel
      reasonably acceptable to the Trustee concluding that such deposit shall
      not cause the Trustee to have a conflicting interest as defined in and for
      purposes of the TIA;

            (3) in the case of Legal Defeasance, LNR shall have delivered to the
      Trustee an Opinion of Counsel confirming that (A) LNR has received from,
      or there has been published by, the Internal Revenue Service a ruling or
      (B) since the date of this

                                      -57-
<PAGE>
      Indenture, there has been a change in the applicable federal income tax
      law, in either case to the effect that, and based thereon such Opinion of
      Counsel shall confirm that, the Holders will not recognize income, gain or
      loss for federal income tax purposes as a result of such Legal Defeasance
      and will be subject to federal income tax on the same amounts, in the same
      manner and at the same times as would have been the case if such Legal
      Defeasance had not occurred;

            (4) in the case of Covenant Defeasance, LNR shall have delivered to
      the Trustee an Opinion of Counsel confirming that the Holders will not
      recognize income, gain or loss for federal income tax purposes as a result
      of such Covenant Defeasance and will be subject to federal income tax on
      the same amounts, in the same manner and at the same times as would have
      been the case if such Covenant Defeasance had not occurred;

            (5) no Default or Event of Default shall have occurred and be
      continuing on the date of such deposit (after giving effect to the
      deposit) or, in the case of Legal Defeasance, insofar as Events of Default
      under SECTION 6.1(VI) OR (VII) are concerned, at any time in the period
      ending on the 91st day after the date of deposit (other than a Default or
      Event of Default resulting from the incurrence of Indebtedness all or a
      portion of the proceeds of which will be used to defease the Notes
      concurrently with such incurrence);

            (6) such Legal Defeasance or Covenant Defeasance shall not result in
      a breach or violation of, or constitute a default under, any material
      agreement or instrument to which LNR or any of its Subsidiaries is a party
      or by which LNR or any of its Subsidiaries is bound;

            (7) such deposit shall not result in LNR, the Trustee or the trust
      becoming or being deemed to be an "investment company" under the
      Investment Company Act of 1940, as amended;

            (8) the Holders shall have a perfected security interest under
      applicable law in the U.S. Legal Tender or U.S. Government Obligations so
      deposited;

            (9) LNR shall have delivered to the Trustee an Officers' Certificate
      stating that the deposit was not made by LNR with the intent of preferring
      the Holders over any other creditors of LNR or with the intent of
      defeating, hindering, delaying or defrauding any other creditors of LNR or
      others;

            (10) LNR shall have delivered to the Trustee an Opinion of Counsel
      to the effect that, after the 91st day following the deposit (assuming
      that no Default or Event of Default shall have occurred and be continuing
      on such 91st day insofar as SECTIONS 6.1 (VI) OR (VII) are concerned), (A)
      the trust funds will not be subject to any rights of holders of
      Indebtedness of LNR other than the Notes and (B) the trust funds will not
      be subject to the effect of any applicable bankruptcy, insolvency,
      reorganization or similar laws affecting creditors' rights generally; and

            (11) LNR shall have delivered to the Trustee an Officers'
      Certificate and an Opinion of Counsel, each stating that all conditions
      precedent provided for or relating to

                                      -58-
<PAGE>
      the Legal Defeasance or the Covenant Defeasance (including without
      limitation that no Default or Event of Default described in SECTION 6.1
      (VI) OR (VII) has occurred and is continuing at the end of the 91-day
      period referred to in the Opinion of Counsel referred to in clause (10)
      above), as the case may be, have been complied with.

SECTION 8.2.      APPLICATION OF TRUST MONEY.

            The Trustee or Paying Agent shall hold in trust U.S. Legal Tender or
U.S. Government Obligations deposited with it pursuant to SECTION 8.1, and shall
apply the deposited U.S. Legal Tender and the money from U.S. Government
Obligations in accordance with this Indenture to the payment of the principal of
and premium, if any, and interest on the Notes. The Trustee shall be under no
obligation to invest said U.S. Legal Tender or U.S. Government Obligations
except as it may agree in writing with LNR.

            LNR shall pay and indemnify the Trustee against any tax, fee or
other charge imposed on or assessed against the U.S. Legal Tender or U.S.
Government Obligations deposited pursuant to SECTION 8.1 or the principal and
interest received in respect thereof other than any such tax, fee or other
charge which by law is for the account of the Holders of outstanding Notes.

SECTION 8.3.      REPAYMENT.

            Subject to SECTION 8.1, the Trustee and the Paying Agent shall
promptly pay to LNR upon request any excess U.S. Legal Tender or U.S. Government
Obligations held by them at any time and thereupon shall be relieved from all
liability with respect to such money. The Trustee and the Paying Agent shall pay
to LNR upon request any money held by them for the payment of principal,
premium, if any, or interest that remains unclaimed for one year; PROVIDED,
HOWEVER, that the Trustee or such Paying Agent, before being required to make
any payment, may at the expense of LNR cause to be published once in a newspaper
of general circulation in the City of New York or mail to each Holder entitled
to such money notice that such money remains unclaimed and that after a date
specified therein which shall be at least 30 days from the date of such
publication or mailing any unclaimed balance of such money then remaining will
be repaid to LNR. After payment to LNR, Holders entitled to such money must look
to LNR for payment as general creditors unless an applicable law designates
another Person.

SECTION 8.4.      REINSTATEMENT.

            If the Trustee or Paying Agent is unable to apply any U.S. Legal
Tender or U.S. Government Obligations in accordance with SECTION 8.1 by reason
of any legal proceeding or by reason of any order or judgment of any court or
governmental authority enjoining, restraining or otherwise prohibiting such
application, LNR's obligations under this Indenture and the Notes shall be
revived and reinstated as though no deposit had occurred pursuant to SECTION 8.1
until such time as the Trustee or Paying Agent is permitted to apply all such
U.S. Legal Tender or U.S. Government Obligations in accordance with SECTION 8.1;
PROVIDED, HOWEVER, that if LNR has made any payment of interest or premium on or
principal of any Notes because of the reinstatement of their obligations, LNR
shall be subrogated to the rights of the Holders of such Notes to receive such
payment from the U.S. Legal Tender or U.S. Government Obligations held by the
Trustee or Paying Agent.


                                      -59-
<PAGE>
SECTION 8.5.      ACKNOWLEDGMENT OF DISCHARGE BY TRUSTEE.

            After (i) the conditions of SECTION 8.1 have been satisfied, (ii)
LNR has paid or caused to be paid all other sums payable hereunder by LNR and
(iii) LNR has delivered to the Trustee an Officers' Certificate and an Opinion
of Counsel, each stating that all conditions precedent referred to in clause (i)
above relating to the satisfaction and discharge of this Indenture have been
complied with, the Trustee upon request shall acknowledge in writing the
discharge of LNR's obligations under this Indenture except for those surviving
obligations specified in SECTION 8.1.

                                   ARTICLE IX.

                          MODIFICATION OF THE INDENTURE

SECTION 9.1.      WITHOUT CONSENT OF HOLDERS.

            Notwithstanding SECTION 9.2, LNR and the Trustee may amend, waive or
supplement this Indenture without notice to or consent of any Holder:

            (a) to cure any ambiguity, defect or inconsistency;

            (b) to comply with SECTION 5.1 of this Indenture;

            (c) to provide for uncertificated Notes in addition to certificated
Notes;

            (d) to comply with any requirements of the Commission in order to
effect or maintain the qualification of this Indenture under the TIA; or

            (e) to make any change that would provide any additional benefit or
rights to the Holders or that does not adversely affect the rights of any Holder
in any material respect.

            Notwithstanding the foregoing, the Trustee and LNR may not make any
change that adversely affects the rights of any Holder in any material respect
under this Indenture without the consent of such Holder. In formulating its
opinion on such matters, the Trustee will be entitled to rely on such evidence
as it deems appropriate, including, without limitation, solely on an Opinion of
Counsel and an Officer Certificate of LNR.

SECTION 9.2.      WITH CONSENT OF HOLDERS.

            All other modifications, waivers and amendments of this Indenture
may be made with the consent of the Holders of a majority in principal amount of
the then outstanding Notes, except that, without the consent of each Holder of
the Notes affected thereby, no amendment or waiver may:

            (i) reduce the amount of Notes whose Holders must consent to an
amendment;

            (ii) reduce the rate of or change or have the effect of changing the
time for payment of interest, including defaulted interest, on any Notes;


                                      -60-
<PAGE>
            (iii) reduce the principal of or change or have the effect of
changing the fixed maturity of any Notes, or change the date on which any Notes
may be subject to redemption or repurchase, or reduce the redemption or
repurchase price therefor;

            (iv) make any Notes payable in money other than that stated in the
Notes;

            (v) make any change in provisions of this Indenture protecting the
right of each Holder to receive payment of principal of and premium, if any, and
interest on such Note on or after the due date thereof or to bring suit to
enforce such payment, or permitting Holders of a majority in principal amount of
Notes to waive Defaults or Events of Default;

            (vi) amend, change or modify in any material respect the obligation
of LNR to make and consummate a Change of Control Offer in the event of a Change
of Control or modify any of the provisions or definitions with respect thereto;
or

            (vii) modify or change any provision of this Indenture or the
related definitions affecting the subordination or ranking of the Notes in a
manner which adversely affects the Holders.

            After an amendment, supplement or waiver under this SECTION 9.2
becomes effective (as provided in SECTION 9.4), LNR shall mail to the Holders
affected thereby a notice briefly describing the amendment, supplement or
waiver. Any failure of LNR to mail such notice, or any defect therein, shall
not, however, in any way impair or affect the validity of any such supplemental
indenture.

SECTION 9.3.      COMPLIANCE WITH TIA.

            Every amendment, waiver or supplement of this Indenture or the Notes
shall comply with the TIA as then in effect; PROVIDED, HOWEVER, that this
SECTION 9.3 shall not of itself require that this Indenture or the Trustee be
qualified under the TIA or constitute any admission or acknowledgment by any
party hereto that any such qualification is required prior to the time this
Indenture and the Trustee are required by the TIA to be so qualified.

SECTION 9.4.      REVOCATION AND EFFECT OF CONSENTS.

            Until an amendment, waiver or supplement becomes effective, a
consent to it by a Holder is a continuing consent by the Holder and every
subsequent Holder of a Note or portion of a Note that evidences the same debt as
the consenting Holder's Note, even if notation of the consent is not made on any
Note. Subject to the following paragraph, any such Holder or subsequent Holder
may revoke the consent as to such Holder's Note or portion of such Note by
notice to the Trustee or LNR received before the date on which the Trustee
receives an Officers' Certificate certifying that the Holders of the requisite
principal amount of Notes have consented (and not theretofore revoked such
consent) to the amendment, supplement or waiver. An amendment, supplement or
waiver becomes effective upon receipt by the Trustee of such Officers'
Certificate and evidence of consent by the Holders of the requisite percentage
in principal amount of outstanding Notes.


                                      -61-
<PAGE>
            LNR may, but shall not be obligated to, fix a Record Date for the
purpose of determining the Holders entitled to consent to any amendment,
supplement or waiver, which Record Date shall be at least 30 days prior to the
first solicitation of such consent. If a Record Date is fixed, then
notwithstanding the second sentence of the immediately preceding paragraph,
those Persons who were Holders at such Record Date (or their duly designated
proxies), and only those Persons, shall be entitled to revoke any consent
previously given, whether or not such Persons continue to be Holders after such
Record Date. No such consent shall be valid or effective for more than 90 days
after such Record Date unless consents from Holders of the requisite percentage
in principal amount of outstanding Notes required hereunder for the
effectiveness of such consents shall have also been given and not revoked within
such 90 day period.

SECTION 9.5.      NOTATION ON OR EXCHANGE OF NOTES.

            If an amendment, supplement or waiver changes the terms of a Note,
the Trustee may require the Holder of such Note to deliver it to the Trustee.
The Trustee may place an appropriate notation on the Note about the changed
terms and return it to the Holder. Alternatively, if LNR or the Trustee so
determine, LNR in exchange for the Note shall issue and the Trustee shall
authenticate a new Note that reflects the changed terms.

SECTION 9.6.      TRUSTEE TO SIGN AMENDMENTS, ETC.

            The Trustee shall execute any amendment, supplement or, waiver
authorized pursuant to this ARTICLE IX; PROVIDED, HOWEVER, that the Trustee may,
but shall not be obligated to, execute any such amendment, supplement or waiver
which affects the Trustees own rights, duties or immunities under this
Indenture. In executing such supplement or waiver the Trustee shall be entitled
to receive indemnity reasonably satisfactory to it, and shall be fully protected
in relying upon an Opinion of Counsel and an Officers' Certificate, stating that
no Default or Event of Default shall occur as a result of such amendment,
supplement or waiver and that the execution of any amendment, supplement or
waiver authorized pursuant to this ARTICLE IX is authorized or permitted by this
Indenture. Such Opinion of Counsel shall not be an expense of the Trustee.

                                   ARTICLE X.

                                  SUBORDINATION

SECTION 10.1.     NOTES SUBORDINATED TO SENIOR INDEBTEDNESS.

            LNR covenants and agrees, and each Holder of the Notes, by its
acceptance thereof, likewise covenants and agrees, that all Notes shall be
issued subject to the provisions of this ARTICLE X; and each Person holding any
Note, whether upon original issue or upon transfer, assignment or exchange
thereof, accepts and agrees that the payment of all Obligations on the Notes by
LNR shall, to the extent and in the manner herein set forth, be subordinated and
junior in right of payment to the prior payment in full in cash or Cash
Equivalents of all Obligations on Senior Indebtedness, including, without
limitation, LNR's obligations under the Credit Agreement; that the subordination
is for the benefit of, and shall be enforceable directly by, the

                                      -62-
<PAGE>
holders of Senior Indebtedness, and that each holder of Senior Indebtedness
whether now outstanding or hereafter created, incurred, assumed or guaranteed
shall be deemed to have acquired Senior Indebtedness in reliance upon the
covenants and provisions contained in this Indenture and the Notes.

SECTION 10.2.     SUSPENSION OF PAYMENT WHEN SENIOR INDEBTEDNESS IS IN DEFAULT.

            (a) If any default occurs and is continuing in the payment when due,
whether at maturity, upon any redemption, by declaration or otherwise, of any
principal of, interest on, unreimbursed drawings for letters of credit issued in
respect of, or regularly accruing fees with respect to, any Senior Indebtedness,
no payment of any kind or character shall be made by or on behalf of LNR or any
Subsidiary of LNR or any obligor on the Notes or any other Person on its or
their behalf with respect to any Obligations on the Notes or to acquire any of
the Notes for cash or property or otherwise. In addition, if any other event of
default occurs and is continuing with respect to any Designated Senior
Indebtedness, as such event of default is defined in the instrument creating or
evidencing such Designated Senior Indebtedness, permitting the holders of such
Designated Senior Indebtedness then outstanding to accelerate the maturity
thereof and if the Representative for that issue of Designated Senior
Indebtedness gives written notice of the event of default to the Trustee (a
"DEFAULT NOTICE"), then, unless and until all events of default with respect to
that issue of Designated Senior Indebtedness have been cured or waived or have
ceased to exist or the Trustee receives written notice from the Representative
for that issue of Designated Senior Indebtedness terminating the Blockage Period
(as defined below), during the 180 days after the delivery of such Default
Notice (the "BLOCKAGE PERIOD"), neither LNR nor any other Person on its behalf
shall (x) make any payment of any kind or character with respect to any
Obligations on the Notes or (y) acquire any of the Notes for cash or property or
otherwise. Notwithstanding anything herein to the contrary, in no event will a
Blockage Period extend beyond 180 days from the date the payment on the Notes
was due and only one such Blockage Period may be commenced with respect to all
issues of Designated Senior Indebtedness within any 360 consecutive days. No
event of default which existed or was continuing on the date of the commencement
of any Blockage Period with respect to the Designated Senior Indebtedness shall
be, or be made, the basis for commencement of a second Blockage Period by the
Representative of such Designated Senior Indebtedness, whether or not within a
period of 360 consecutive days, unless such event of default shall have been
cured or waived for a period of not less than 90 consecutive days (it being
acknowledged that any subsequent action, or any breach of any financial
covenants for a period commencing after the date of commencement of such
Blockage Period that, in either case, would give rise to an event of default
pursuant to any provisions under which an event of default previously existed or
was continuing shall constitute a new event of default for this purpose).

            (b) In the event that, notwithstanding the foregoing, any payment
shall be received by the Trustee or any Holder when such payment is prohibited
by SECTION 10.2(A), such payment shall be held in trust for the benefit of, and
shall be paid over or delivered to, the holders of Senior Indebtedness (PRO RATA
to such holders on the basis of the respective amount of Senior Indebtedness
held by such holders) or their respective Representatives, as their respective
interests may appear. The Trustee shall be entitled to rely on information
regarding amounts then due and owing on the Senior Indebtedness, if any,
received from the holders of Senior Indebtedness (or their Representatives) or,
if such information is not received from such holders

                                      -63-
<PAGE>
or their Representatives, from LNR and only amounts included in the information
provided to the Trustee shall be paid to the holders of Senior Indebtedness.

            Nothing contained in this ARTICLE X shall limit the right of the
Trustee or the Holders of Notes to take any action to accelerate the maturity of
the Notes pursuant to SECTION 6.2 or to pursue any rights or remedies hereunder;
PROVIDED that all Senior Indebtedness thereafter due or declared to be due shall
first be paid in full in cash or Cash Equivalents before the Holders are
entitled to receive any payment of any kind or character with respect to
Obligations on the Notes.

SECTION 10.3.     NOTES SUBORDINATED TO PRIOR PAYMENT OF ALL SENIOR INDEBTEDNESS
                  ON DISSOLUTION, LIQUIDATION OR REORGANIZATION.

            (a) Upon any payment or distribution of assets of LNR of any kind or
character, whether in cash, property or securities, to creditors upon any total
or partial liquidation, dissolution, winding-up, reorganization, assignment for
the benefit of creditors or marshaling of assets of LNR or in a bankruptcy,
reorganization, insolvency, receivership or other similar proceeding relating to
LNR or its property, whether voluntary or involuntary, all Obligations upon all
Senior Indebtedness shall first be paid in full in cash or Cash Equivalents, or
such payment duly provided for to the satisfaction of the holders of Senior
Indebtedness, before any payment or distribution of any kind or character is
made on account of any Obligations on the Notes, or for the acquisition of any
of the Notes for cash or property or otherwise. Upon any such dissolution,
winding-up, liquidation, reorganization, receivership or similar proceeding, any
payment or distribution of assets of LNR of any kind or character, whether in
cash, property or securities, to which the Holders of the Notes or the Trustee
under this Indenture would be entitled, except for the provisions hereof, shall
be paid by LNR or by any receiver, trustee in bankruptcy, liquidating trustee,
agent or other Person making such payment or distribution, or by the Holders or
by the Trustee under this Indenture if received by them, directly to the holders
of Senior Indebtedness (PRO RATA to such holders on the basis of the respective
amounts of Senior Indebtedness held by such holders) or their respective
Representatives, or to the trustee or trustees under any indenture pursuant to
which any of such Senior Indebtedness may have been issued, as their respective
interests may appear, for application to the payment of Senior Indebtedness
remaining unpaid until all such Senior Indebtedness has been paid in full in
cash or Cash Equivalents after giving effect to any concurrent payment,
distribution or provision therefor to or for the holders of Senior Indebtedness.

            (b) To the extent any payment of Senior Indebtedness (whether by or
on behalf of LNR, as proceeds of security or enforcement of any right of setoff
or otherwise) is declared to be fraudulent or preferential, set aside or
required to be paid to any receiver, trustee in bankruptcy, liquidating trustee,
agent or other similar Person under any bankruptcy, insolvency, receivership,
fraudulent conveyance or similar law, then, if such payment is recovered by, or
paid over to, such receiver, trustee in bankruptcy, liquidating trustee, agent
or other similar Person, the Senior Indebtedness or part thereof originally
intended to be satisfied shall be deemed to be reinstated and outstanding as if
such payment has not occurred.

            (c) In the event that, notwithstanding the foregoing, any payment or
distribution of assets of LNR of any kind or character, whether in cash,
property or securities,

                                      -64-
<PAGE>
shall be received by any Holder when such payment or distribution is prohibited
by this SECTION 10.3, such payment or distribution shall be held in trust for
the benefit of, and shall be paid over or delivered to, the holders of Senior
Indebtedness (PRO RATA to such holders on the basis of the respective amount of
Senior Indebtedness held by such holders) or their respective Representatives,
or to the trustee or trustees under any indenture pursuant to which any of such
Senior Indebtedness may have been issued, as their respective interests may
appear, for application to the payment of Senior Indebtedness remaining unpaid
until all such Senior Indebtedness has been paid in full in cash or Cash
Equivalents, after giving effect to any concurrent payment, distribution or
provision therefor to or for the holders of such Senior Indebtedness.

            (d) The consolidation of LNR with, or the merger of LNR with or
into, another corporation or the liquidation or dissolution of LNR following the
conveyance or transfer of all or substantially all of its assets, to another
corporation upon the terms and conditions provided in ARTICLE V hereof and as
long as permitted under the terms of the Senior Indebtedness shall not be deemed
a dissolution, winding-up, liquidation or reorganization for the purposes of
this SECTION 10.3 if such other corporation shall, as a part of such
consolidation, merger, conveyance or transfer, assume LNR's obligations
hereunder in accordance with ARTICLE V hereof.

SECTION 10.4.     HOLDERS TO BE SUBROGATED TO RIGHTS OF HOLDERS OF SENIOR
                  INDEBTEDNESS.

            Subject to the payment in full in cash or Cash Equivalents of all
Senior Indebtedness, the Holders of the Notes shall be subrogated to the rights
of the holders of Senior Indebtedness to receive payments or distributions of
cash, property or securities of LNR applicable to the Senior Indebtedness until
the Notes shall be paid in full; and, for the purposes of such subrogation, no
payments or distributions to the holders of the Senior Indebtedness by or on
behalf of LNR or by or on behalf of the Holders by virtue of this ARTICLE X
which otherwise would have been made to the Holders shall, as between LNR and
the Holders of the Notes, be deemed to be a payment by LNR to or on account of
the Senior Indebtedness, it being understood that the provisions of this ARTICLE
X are and are intended solely for the purpose of defining the relative rights of
the Holders of the Notes, on the one hand, and the holders of the Senior
Indebtedness, on the other hand.

SECTION 10.5.     OBLIGATIONS OF LNR UNCONDITIONAL.

            Nothing contained in this ARTICLE X or elsewhere in this Indenture
or in the Notes is intended to or shall impair, as between LNR and the Holders,
the obligation of LNR, which is absolute and unconditional, to pay to the
Holders the principal of and premium, if any, and interest on the Notes as and
when the same shall become due and payable in accordance with their terms, or is
intended to or shall affect the relative rights of the Holders and creditors of
LNR other than the holders of the Senior Indebtedness, nor shall anything herein
or therein prevent the Trustee or any Holder from exercising all remedies
otherwise permitted by applicable law upon default under this Indenture, subject
to the rights, if any, under this ARTICLE X of the holders of Senior
Indebtedness in respect of cash, property or securities of LNR received upon the
exercise of any such remedy. Upon any payment or distribution of assets or


                                      -65-
<PAGE>
securities of LNR referred to in this ARTICLE X, the Trustee, subject to the
provisions of SECTIONS 7.1 AND 7.2, and the Holders shall be entitled to rely
upon any order or decree made by any court of competent jurisdiction in which
any liquidation, dissolution, winding-up or reorganization proceedings are
pending, or a certificate of the receiver, trustee in bankruptcy, liquidating
trustee or agent or other Person making any payment or distribution to the
Trustee or to the Holders for the purpose of ascertaining the Persons entitled
to participate in such payment or distribution, the holders of Senior
Indebtedness and other Indebtedness of LNR, the amount thereof or payable
thereon, the amount or amounts paid or distributed thereon and all other facts
pertinent thereto or to this ARTICLE X. Nothing in this ARTICLE X shall apply to
the claims of, or payments to, the Trustee under or pursuant to SECTION 7.7. The
Trustee shall be entitled to rely on the delivery to it of a written notice by a
Person representing himself or itself to be a holder of any Senior Indebtedness
(or a trustee on behalf of, or other representative of, such holder) to
establish that such notice has been given by a holder of such Senior
Indebtedness or a trustee or representative on behalf of any such holder.

            In the event that the Trustee determines in good faith that any
evidence is required with respect to the right of any Person as a holder of
Senior Indebtedness to participate in any payment or distribution pursuant to
this ARTICLE X (although it is not obligated to make any such inquiry), the
Trustee may request such Person to furnish evidence to the reasonable
satisfaction of the Trustee as to the amount of Senior Indebtedness held by such
Person, the extent to which such person is entitled to participate in such
payment or distribution and any other facts pertinent to the rights of such
Person under this ARTICLE X, and if such evidence is not furnished, the Trustee
may defer any payment to such Person pending judicial determination as to the
right of such Person to receive such payment.

            Whenever a distribution is to be made or a notice given to holders
or owners of Senior Indebtedness, the distribution may be made and the notice
may be given to their Representative, if any.

SECTION 10.6.     TRUSTEE ENTITLED TO ASSUME PAYMENTS NOT PROHIBITED IN ABSENCE
                  OF NOTICE.

            LNR shall give prompt written notice to the Trustee of any fact
known to LNR which would prohibit the making of any payment to or by the Trustee
in respect of the Notes pursuant to the provisions of this ARTICLE X. Regardless
of anything to the contrary contained in this ARTICLE X or elsewhere in this
Indenture, the Trustee shall not be charged with knowledge of the existence of
any default or event of default with respect to any Senior Indebtedness or of
any other facts which would prohibit the making of any payment to or by the
Trustee unless and until the Trustee shall have received notice in writing from
LNR, or from a holder of Senior Indebtedness or a Representative therefor,
together with proof satisfactory to the Trustee of such holding of Senior
Indebtedness or of the authority of such Representative, and, prior to the
receipt of any such written notice, the Trustee shall be entitled to assume (in
the absence of actual knowledge to the contrary) that no such facts exist.


                                      -66-
<PAGE>
SECTION 10.7.     APPLICATION BY TRUSTEE OF ASSETS DEPOSITED WITH IT.

            U.S. Legal Tender or U.S. Government Obligations deposited in trust
with the Trustee pursuant to and in accordance with SECTIONS 8.1 AND 8.2 shall
be for the sole benefit of the Holders of the Notes and, to the extent allocated
for the payment of Notes, shall not be subject to the subordination provisions
of this ARTICLE X. Otherwise, any deposit of assets or securities by or on
behalf of LNR with the Trustee or any Paying Agent (whether or not in trust) for
the payment of principal of or interest on any Notes shall be subject to the
provisions of this ARTICLE X; PROVIDED, HOWEVER, that if prior to the second
Business Day preceding the date on which by the terms of this Indenture any such
assets may become distributable for any purpose (including, without limitation,
the payment of either principal of or premium, if any, or interest on any Note)
the Trustee or such Paying Agent shall not have received with respect to such
assets the notice provided for in SECTION 10.6, then the Trustee or such Paying
Agent shall have full power and authority to receive such assets and to apply
the same to the purpose for which they were received, and shall not be affected
by any notice to the contrary received by it on or after such date. The
foregoing shall not apply to the Paying Agent if LNR or any Subsidiary or
Affiliate of LNR is acting as Paying Agent. Nothing contained in this SECTION
10.7 shall limit the right of the holders of Senior Indebtedness to recover
payments as contemplated by this ARTICLE X.

SECTION 10.8.     NO WAIVER OF SUBORDINATION PROVISIONS.

            (a) No right of any present or future holder of any Senior
Indebtedness to enforce subordination as herein provided shall at any time in
any way be prejudiced or impaired by any act or failure to act on the part of
LNR or by any act or failure to act by any such holder, or by any non-compliance
by LNR with the terms, provisions and covenants of this Indenture, regardless of
any knowledge thereof any such holder may have or be otherwise charged with.

            (b) Without limiting the generality of SECTION 10.8(A), the holders
of Senior Indebtedness may, at any time and from time to time, without the
consent of or notice to the Trustee or the Holders of the Notes, without
incurring responsibility to the Holders of the Notes and without impairing or
releasing the subordination provided in this ARTICLE X or the obligations
hereunder of the Holders of the Notes to the holders of Senior Indebtedness, do
any one or more of the following: (1) change the manner, place, terms or time of
payment of, or renew or alter, Senior Indebtedness or any instrument evidencing
the same or any agreement under which Senior Indebtedness is outstanding; (2)
sell, exchange, release or otherwise deal with any property pledged, mortgaged
or otherwise securing Senior Indebtedness; (3) release any Person liable in any
manner for the collection or payment of Senior Indebtedness; and (4) exercise or
refrain from exercising any rights against LNR and any other Person.

SECTION 10.9.     HOLDERS AUTHORIZE TRUSTEE TO EFFECTUATE SUBORDINATION OF
                  NOTES.

            Each Holder of the Notes by such Holder's acceptance thereof
authorizes and expressly directs the Trustee on his behalf to take such action
as may be necessary or appropriate to effect the subordination provisions
contained in this ARTICLE X, and appoints the Trustee such Holder's
attorney-in-fact for such purpose, including, in the event of any liquidation,
dissolution,


                                      -67-
<PAGE>
winding-up, reorganization, assignment for the benefit of creditors or
marshaling of assets of LNR tending towards liquidation or reorganization of the
business and assets of LNR, the immediate filing of a claim for the unpaid
balance of such Holder's Notes in the form required in said proceedings and
cause said claim to be approved. If the Trustee does not file a proper claim or
proof of debt in the form required in such proceeding prior to 30 days before
the expiration of the time to file such claim or claims, then any of the holders
of the Senior Indebtedness or their Representative is hereby authorized to file
an appropriate claim for and on behalf of the Holders of said Notes. Nothing
herein contained shall be deemed to authorize the Trustee or the holders of
Senior Indebtedness or their Representative to authorize or consent to or accept
or adopt on behalf of any Holder any plan of reorganization, arrangement,
adjustment or composition affecting the Notes or the rights of any Holder
thereof, or to authorize the Trustee or the holders of Senior Indebtedness or
their Representative to vote in respect of the claim of any Holder in any such
proceeding.

SECTION 10.10.    RIGHT OF TRUSTEE TO HOLD SENIOR INDEBTEDNESS.

            The Trustee and any agent or Affiliate of the Trustee shall be
entitled to all the rights set forth in this ARTICLE X with respect to any
Senior Indebtedness which may at any time be held by it in its individual or any
other capacity to the same extent as any other holder of Senior Indebtedness and
nothing in this Indenture shall deprive the Trustee or any such agent or
Affiliate of any of its rights as such holder.

SECTION 10.11.    SUBORDINATION NOT TO PREVENT EVENTS OF DEFAULT.

            The failure to make a payment on account of principal of or premium,
if any, or interest on the Notes by reason of any provision of this ARTICLE X
will not be construed as preventing the occurrence of an Event of Default.

            Nothing contained in this ARTICLE X shall limit the right of the
Trustee or the Holders of Notes to take any action to accelerate the maturity of
the Notes pursuant to ARTICLE VI or to pursue any rights or remedies hereunder
or under applicable law, subject to the rights, if any, under this ARTICLE X of
the holders, from time to time, of Senior Indebtedness.

SECTION 10.12.    NO FIDUCIARY DUTY OF TRUSTEE TO HOLDERS OF SENIOR
                  INDEBTEDNESS.

            The Trustee shall not be deemed to owe any fiduciary duty to the
holders of Senior Indebtedness, and it undertakes to perform or observe such of
its covenants and obligations as are specifically set forth in this ARTICLE X,
and no implied covenants or obligations with respect to the Senior Indebtedness
shall be read into this Indenture against the Trustee. The Trustee shall not be
liable to any such holders (other than for its willful misconduct or gross
negligence) if it shall pay over or deliver to the Holders of Notes or LNR or
any other Person money or assets in compliance with the terms of this Indenture.
Nothing in this SECTION 10.12 shall affect the obligation of any Person other
than the Trustee to hold such payment for the benefit of, and to pay such
payment over to, the holders of Senior Indebtedness or their Representative.


                                      -68-
<PAGE>
                                ARTICLE XI.

                               MISCELLANEOUS

SECTION 11.1.     TIA CONTROLS.

            If any provision of this Indenture limits, qualifies, or conflicts
with another provision which is required to be included in this Indenture by the
TIA, the required provision shall control; PROVIDED, HOWEVER, that this SECTION
11.1 shall not of itself require that this Indenture or the Trustee be qualified
under the TIA or constitute any admission or acknowledgment by any party hereto
that any such qualification is required prior to the time this Indenture and the
Trustee are required by the TIA to be so qualified.

SECTION 11.2.     NOTICES.

            Any notices or other communications required or permitted hereunder
shall be in writing, and shall be sufficiently given if made by hand delivery,
by telex, by telecopier or overnight courier guaranteeing next-day delivery or
registered or certified mail, postage prepaid, return receipt requested,
addressed as follows:

            if to LNR:

                  1601 Washington Avenue, Suite 800
                  Miami Beach, Florida  33139
                  Telecopier Number:  (305) 229-6488
                  Attn:  Shelly Rubin, Chief Financial Officer

            if to the Trustee:

                  100 Wall Street, Suite 1600
                  New York, New York  10005
                  Telecopier Number:  (212) 509-3384
                  Attention:  Corporate Trust Administration

            Each of LNR and the Trustee by written notice to the other may
designate additional or different addresses for notices to such Person. Any
notice or communication to LNR or the Trustee shall be deemed to have been given
or made as of the date so delivered if hand delivered; when answered back, if
telexed; when receipt is acknowledged, if faxed; and five (5) calendar days
after mailing if sent by registered or certified mail, postage prepaid (except
that a notice of change of address shall not be deemed to have been given until
actually received by the addressee).

            Any notice or communication mailed to a Holder shall be mailed by
first class mail, certified or registered return receipt requested, or by
overnight courier guaranteeing next day delivery to its address as it appears on
the registration books of the Registrar. Any notice or communication shall be
mailed to any Person as described in TIA Section 313(C), to the extent required
by the TIA.


                                      -69-
<PAGE>
            Failure to mail a notice or communication to a Holder or any defect
in it shall not affect its sufficiency with respect to other Holders. If a
notice or communication is mailed in the manner provided above, it is duly
given, whether or not the addressee receives it.

SECTION 11.3.     COMMUNICATIONS BY HOLDERS WITH OTHER HOLDERS.

            Holders may communicate pursuant to TIA Section 312(b) with otheR
Holders with respect to their rights under this Indenture or the Notes. LNR, the
Trustee, the Registrar and any other Person shall have the protection of TIA
Section 312(c).

SECTION 11.4.     CERTIFICATE AND OPINION AS TO CONDITIONS PRECEDENT.

            Upon any request or application by LNR to the Trustee to take any
action under this Indenture, LNR shall furnish to the Trustee:

            (1) an Officers' Certificate, in form and substance satisfactory to
      the Trustee, stating that, in the opinion of the signers, all conditions
      precedent to be performed, if any, provided for in this Indenture relating
      to the proposed action have been complied with; and

            (2) an Opinion of Counsel stating that, in the opinion of such
      counsel, all such conditions precedent to be performed, if any, provided
      for in this Indenture relating to the proposed action have been complied
      with (which counsel, as to factual matters, may rely on an Officers'
      Certificate).

SECTION 11.5.     STATEMENTS REQUIRED IN CERTIFICATE OR OPINION.

            Each certificate or opinion with respect to compliance with a
condition or covenant provided for in this Indenture, other than the Officers'
Certificate required by SECTION 4.6, shall include:

            (1)   a statement that the Person making such certificate or
      opinion has read such covenant or condition;

            (2) a brief statement as to the nature and scope of the examination
      or investigation upon which the statements or opinions contained in such
      certificate or opinion are based;

            (3) a statement that, in the opinion of such Person, he has made
      such examination or investigation as is reasonably necessary to enable him
      to express an informed opinion as to whether or not such covenant or
      condition has been complied with; and

            (4) a statement as to whether or not, in the opinion of such Person,
      such condition or covenant has been complied with.


                                      -70-
<PAGE>
SECTION 11.6.     RULES BY TRUSTEE, PAYING AGENT, REGISTRAR.

            The Trustee may make reasonable rules in accordance with the
Trustee's customary practices for action by or at a meeting of Holders. The
Paying Agent or Registrar may make reasonable rules for its functions.

SECTION 11.7.     LEGAL HOLIDAYS.

            If any payment date is due on a day other than a Business Day, such
payment may be made on the next succeeding Business Day, and no interest shall
accrue for the intervening period.

SECTION 11.8.     GOVERNING LAW.

            THIS INDENTURE AND THE NOTES SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, INCLUDING SECTION 5-1401 OF
THE GENERAL OBLIGATIONS LAW OF THE STATE OF NEW YORK, BUT OTHERWISE WITHOUT
REGARD TO CONFLICT OF LAWS RULES THAT WOULD APPLY THE LAWS OF ANY OTHER
JURISDICTION. Each of the parties hereto agrees to submit to the jurisdiction of
the courts of the State of New York sitting in the County of New York, or of the
United States of America for the Southern District of New York in any action or
proceeding arising out of or relating to this Indenture.

SECTION 11.9.     NO ADVERSE INTERPRETATION OF OTHER AGREEMENTS.

            This Indenture may not be used to interpret another indenture, loan
or debt agreement of LNR or any of its Subsidiaries. Any such indenture, loan or
debt agreement may not be used to interpret this Indenture.

SECTION 11.10.    NO PERSONAL LIABILITY.

            No director, officer, employee or stockholder of LNR, as such, shall
have any liability for any obligations of LNR under the Notes or this Indenture
or for any claim based on, in respect of, or by reason of, such obligations or
their creation. Each Holder of Notes by accepting a Note waives and releases all
such liability. The waiver and release are part of the consideration for the
issuance of the Notes.

SECTION 11.11.    SUCCESSORS.

            All agreements of LNR in this Indenture and the Notes shall bind
their successors and permitted assigns. All agreements of the Trustee in this
Indenture shall bind its successors and permitted assigns.

SECTION 11.12.    DUPLICATE ORIGINALS.

            All parties may sign any number of copies of this Indenture. Each
signed copy shall be an original, but all of them together shall represent the
same agreement.

                                      -71-
<PAGE>
SECTION 11.13.    SEVERABILITY.

            In case any one or more of the provisions in this Indenture or in
the Notes shall be held invalid, illegal or unenforceable, in any respect for
any reason, the validity, legality and enforceability of any such provision in
every other respect and of the remaining provisions shall not in any way be
affected or impaired thereby, it being intended that all of the provisions
hereof shall be enforceable to the full extent permitted by law.


                                      -72-
<PAGE>
                                 SIGNATURES

            IN WITNESS WHEREOF, the parties hereto have caused this Indenture to
be duly executed, all as of the date first written above.

                                    LNR PROPERTY CORPORATION

                                    By:    ____________________
                                    Name:  ____________________
                                    Title: ____________________



                                    U.S. BANK TRUST NATIONAL ASSOCIATION,
                                    as Trustee

                                    By:    ____________________
                                    Name:  ____________________
                                    Title: ____________________


                       [Signature Page to Indenture]
<PAGE>
                                                                       EXHIBIT A


                             [FORM OF SERIES A NOTE]

            THIS SECURITY (OR ITS PREDECESSOR) WAS ORIGINALLY ISSUED IN A
TRANSACTION EXEMPT FROM REGISTRATION UNDER THE U.S. SECURITIES ACT OF 1933 (THE
"SECURITIES ACT"), AND THIS SECURITY MAY NOT BE OFFERED, SOLD OR OTHERWISE
TRANSFERRED IN THE ABSENCE OF SUCH REGISTRATION OR AN APPLICABLE EXEMPTION
THEREFROM. EACH PURCHASER OF THIS SECURITY IS HEREBY NOTIFIED THAT THE SELLER OF
THIS SECURITY MAY BE RELYING ON THE EXEMPTION FROM THE PROVISIONS OF SECTION 5
OF THE SECURITIES ACT PROVIDED BY RULE 144A THEREUNDER.

            THE HOLDER OF THIS SECURITY AGREES FOR THE BENEFIT OF THE COMPANY
THAT (A) THIS SECURITY MAY BE OFFERED, RESOLD, PLEDGED OR OTHERWISE TRANSFERRED,
ONLY (I) TO THE ISSUER OR ANY SUBSIDIARY OF THE ISSUER, (II) TO A PERSON WHOM
THE SELLER REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER (AS DEFINED IN
RULE 144A UNDER THE SECURITIES ACT) IN A TRANSACTION MEETING THE REQUIREMENTS OF
RULE 144A, (III) TO AN INSTITUTIONAL "ACCREDITED INVESTOR" (AS DEFINED IN RULE
501(a)(1), (2), (3) OR (7) UNDER THE SECURITIES ACT), (IV) IN AN OFFSHORE
TRANSACTION COMPLYING WITH RULE 903 OR RULE 904 OF REGULATION S UNDER THE
SECURITIES ACT, (V) PURSUANT TO AN EXEMPTION FROM REGISTRATION UNDER THE
SECURITIES ACT PROVIDED BY RULE 144 THEREUNDER (IF AVAILABLE) OR (VI) PURSUANT
TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT, IN EACH CASE IN
ACCORDANCE WITH ANY APPLICABLE SECURITIES LAWS OF ANY STATE OF THE U.S., AND (B)
THE HOLDER WILL, AND EACH SUBSEQUENT HOLDER IS REQUIRED TO, NOTIFY ANY
SUBSEQUENT PURCHASER OF THIS SECURITY FROM IT OF THE RESALE RESTRICTIONS
REFERRED TO IN (A) ABOVE.

            THE FOREGOING LEGEND MAY BE REMOVED FROM THE SECURITY ON
SATISFACTION OF THE CONDITIONS SPECIFIED IN THE INDENTURE.


                                      A-1
<PAGE>
                           CUSIP No.: __________


                          LNR PROPERTY CORPORATION

             7.25% SENIOR SUBORDINATED NOTE DUE 2013, SERIES A

<TABLE>
<S>                        <C>
Number _________                                                $______________

Interest Payment Dates:      April 15 and October 15, commencing April 15, 2004

Record Dates:              March 31 and September 30, commencing March 31, 2004
</TABLE>

            LNR PROPERTY CORPORATION, a Delaware corporation ("LNR", which term
includes any successor entities), for value received promises to pay to
_____________________ or registered assigns the principal sum of
__________________ Dollars on October 15, 2013.

            Reference is made to the further provisions of this Note contained
herein, which will for all purposes have the same effect as if set forth at this
place.

           IN WITNESS WHEREOF, LNR has caused this Note to be signed manually or
by facsimile by its duly authorized officers.

                                    LNR PROPERTY CORPORATION

                                    By:   ___________________
                                          Name:
                                          Title:


Dated:


                                      A-2
<PAGE>
                          Certificate of Authentication

           This is one of the 7.25% Senior Subordinated Notes due 2013, Series
A, referred to in the within-mentioned Indenture.

                                    U.S. BANK TRUST NATIONAL ASSOCIATION,
                                    as Trustee

                                    By:    ____________________
                                    Name:  ____________________
                                    Title: ____________________

            Date of Authentication:  ____________________


                                      A-3
<PAGE>
                              (REVERSE OF SECURITY)

                7.25% Senior Subordinated Note due 2013, Series A


            Capitalized terms used and not otherwise defined herein shall have
the meanings ascribed to them in the Indenture, dated as of October 29, 2003
(the "INDENTURE"), and as amended from time to time, by and between LNR PROPERTY
CORPORATION, a Delaware corporation ("LNR") and U.S. BANK TRUST NATIONAL
ASSOCIATION, as trustee (the "TRUSTEE").

            (1) INTEREST. LNR promises to pay interest on the principal amount
of this Note at the rate per annum above. Interest on the Notes will accrue from
the most recent date to which interest has been paid or, if no interest has been
paid, from October 29, 2003. LNR will pay interest semi-annually in arrears on
each Interest Payment Date. Interest will be computed on the basis of a 360-day
year of twelve 30-day months and, in the case of a partial month, the actual
number of days elapsed.

            LNR shall pay interest on overdue principal and, to the extent
lawful, on overdue installments of interest (without regard to any applicable
grace periods) from time to time on demand at the rate borne by the Notes.

            (2) METHOD OF PAYMENT. LNR shall pay interest on the Notes (except
defaulted interest) to the Persons who are the registered Holders at the close
of business on the Record Date immediately preceding the Interest Payment Date
even if the Notes are canceled on registration of transfer or registration of
exchange (including pursuant to an Exchange Offer (as defined in the
Registration Rights Agreement) or a Change of Control Offer) after such Record
Date. Holders must surrender Notes to a Paying Agent to collect principal
payments. LNR shall pay principal and premium, if any, and interest in money of
the United States that at the time of payment is legal tender for payment of
public and private debts ("U.S. LEGAL TENDER"). However, LNR may pay principal
and premium, if any, and interest by check payable in such U.S. Legal Tender or
by wire transfer of immediately available funds. LNR may deliver any such
interest payment to the Paying Agent or to a Holder at the Holder's registered
address.

            (3) PAYING AGENT AND REGISTRAR. Initially, the Trustee will act as
Paying Agent and Registrar. LNR may change any Paying Agent, Registrar or
co-Registrar without notice to the Holders.

            (4) INDENTURE. LNR issued the Notes under the Indenture. This Note
is one of a duly authorized issue of Notes of LNR designated as its 7.25% Senior
Subordinated Notes due 2013, Series A (the "INITIAL Notes"), limited to what may
be issued under the Indenture pursuant to SECTIONS 2.2 and 4.12. The Notes
include the Initial Notes, the Private Exchange Notes and the Unrestricted
Notes, as defined below, issued in exchange for the Initial Notes pursuant to
the Registration Rights Agreement. The Initial Notes, the Private Exchange Notes
and the Unrestricted Notes are treated as a single class of securities under the
Indenture. The terms of the Notes include those stated in the Indenture and
those made part of the Indenture by reference to the Trust Indenture Act of 1939
(15 U.S. Code Sections 77aaa-77bbbb) (the "TIA"), as in effect on the date
of the Indenture. Notwithstanding anything to the contrary herein, the Notes


                                      A-4
<PAGE>
are subject to all such terms, and Holders of Notes are referred to the
Indenture and the TIA for a statement of such terms. The Notes are general
unsecured obligations of LNR. Each Holder, by accepting a Note, agrees to be
bound by all of the terms and provisions of the Indenture, as the same may be
amended from time to time in accordance with its terms.

            (5) REDEMPTION. The Notes are redeemable, at LNR's option, in whole
or in part from time to time, at any time on or after October 15, 2008 upon not
less than 30 nor more than 60 days' notice, at the following Redemption Prices
(expressed as percentages of the principal amount thereof) if redeemed during
the twelve-month period commencing on October 15 of the years set forth below,
plus, in each case, accrued and unpaid interest thereon, if any, to the date of
redemption:

<TABLE>
<CAPTION>
            Year                                           Percentage
            ----                                           ----------
<S>                                                        <C>
            2008.............................................103.625%
            2009.............................................102.417%
            2010.............................................101.208%
            2011 and thereafter...............................100.00%
</TABLE>


            Notwithstanding the foregoing, at any time, or from time to time, on
or prior to October 15, 2006, LNR may, at its option, redeem, with the net cash
proceeds of one or more Public Equity Offerings by LNR, up to 35% of the
aggregate principal amount of the Notes issued and sold by LNR at a redemption
price equal to 107.25% of the principal amount thereof, plus accrued interest
thereon, if any, to the date of redemption, PROVIDED, that at least 65% of the
aggregate principal amount of the Notes issued and sold by LNR remain
outstanding immediately following such redemption. In order to effect the
foregoing redemption with the proceeds of any Public Equity Offering, LNR shall
make such redemption not more than 60 days after the consummation of any such
Public Equity Offering.

            (6) NOTICE OF REDEMPTION. Notice of redemption will be mailed at
least 30 but not more than 60 days before the Redemption Date to each Holder of
Notes to be redeemed at its registered address. Notes in denominations larger
than $1,000 may be redeemed in part.

            Except as set forth in the Indenture, if monies for the redemption
of the Notes called for redemption shall have been deposited with the Paying
Agent for redemption on such Redemption Date, then, unless LNR defaults in the
payment of such Redemption Price plus accrued interest, if any, the Notes called
for redemption will cease to bear interest from and after such Redemption Date
and the only right of the Holders of such Notes will be to receive payment of
the Redemption Price plus accrued interest, if any.

            (7) CHANGE OF CONTROL OFFER. The Indenture provides that, upon the
occurrence of a Change of Control, and subject to further limitations contained
therein, LNR will make a Change of Control Offer to purchase the Notes in
accordance with the procedures set forth in the Indenture.

            (8)   REGISTRATION RIGHTS.


                                      A-5
<PAGE>
            Pursuant to the Registration Rights Agreement LNR will be obligated
to consummate an exchange offer pursuant to which the Holder of this Note shall
have the right to exchange this Note for LNR's 7.25% Senior Subordinated Notes
due 2013, Series B (the "UNRESTRICTED NOTES"), which will be registered under
the Securities Act, in like principal amount and having terms identical in all
material respects as the Initial Notes. The Holders of the Initial Notes shall
be entitled to receive certain additional interest payments in the event such
exchange offer is not consummated and upon certain other conditions, all
pursuant to and in accordance with the terms of the Registration Rights
Agreement.

            (9) DENOMINATIONS; TRANSFER; EXCHANGE. The Notes are in registered
form, without coupons, in denominations of $1,000 and integral multiples of
$1,000. A Holder shall register the transfer of or exchange of Notes in
accordance with the Indenture. The Registrar may require a Holder, among other
things, to furnish appropriate endorsements and transfer documents and to pay
certain transfer taxes or similar governmental charges payable in connection
therewith as required by law or as permitted by the Indenture. The Registrar
need not register the transfer of or exchange of any Notes or portions thereof
selected for redemption except for the unredeemed portion of any Note being
redeemed in part.

            (10) PERSONS DEEMED OWNERS. The registered Holder of a Note shall be
treated as the owner of it for all purposes.

            (11) UNCLAIMED MONEY. If money for the payment of principal,
premium, if any, or interest remains unclaimed for one year, the Trustee and the
Paying Agent will pay the money back to LNR. After that, all liability of the
Trustee and such Paying Agent with respect to such money shall cease.

            (12) DISCHARGE PRIOR TO REDEMPTION OR MATURITY. If LNR at any time
deposits with the Trustee U.S. Legal Tender or U.S. Government Obligations
sufficient to pay the principal of, premium, if any, and interest on the Notes
to redemption or maturity and complies with the other provisions of the
Indenture relating thereto, LNR will be discharged from certain provisions of
the Indenture and the Notes (excluding certain covenants, but including, under
certain circumstances, its obligation to pay the principal of and interest on
the Notes but without affecting the rights of the Holders to receive such
amounts from such deposits).

            (13) AMENDMENT; SUPPLEMENT; WAIVER. Subject to certain exceptions
set forth in the Indenture, the Indenture or the Notes may be amended or
supplemented with the written consent of the Holders of not less than a majority
in aggregate principal amount of the Notes then outstanding, and any past
Default or Event of Default or noncompliance with any provision may be waived
with the written consent of the Holders of not less than a majority in aggregate
principal amount of the Notes then outstanding. Without notice to or consent of
any Holder, the parties thereto may amend or supplement the Indenture or the
Notes to, among other things, cure any ambiguity, defect or inconsistency,
provide for uncertificated Notes in addition to or in place of certificated
Notes, comply with any requirements of the Commission in order to effect or
maintain the qualification of the Indenture under the TIA or comply with SECTION
5.1 of the Indenture or make any other change that does not adversely affect the
rights of any Holder of a Note in any material respect.


                                      A-6
<PAGE>
            (14) RESTRICTIVE COVENANTS. The Indenture imposes certain
limitations on the ability of LNR and its Subsidiaries to, among other things,
incur additional Indebtedness, make payments in respect of its Capital Stock or
certain Indebtedness, create or incur liens, enter into transactions with
Affiliates, create dividend or other payment restrictions affecting
Subsidiaries, issue Preferred Stock of its Subsidiaries, and on the ability of
LNR to merge or consolidate with any other Person or sell, assign, transfer,
lease, convey or otherwise dispose of all or substantially all of LNR's and its
Subsidiaries' assets or adopt a plan of liquidation. Such limitations are
subject to a number of important qualifications and exceptions. Pursuant to the
Indenture, LNR must annually report to the Trustee on compliance with such
limitations.

            (15) SUBORDINATION. The Notes are subordinated in right of payment,
in the manner and to the extent set forth in the Indenture, to the prior payment
in full in cash or Cash Equivalents of all Obligations on Senior Indebtedness of
LNR, whether outstanding on the date of the Indenture or thereafter created,
incurred, assumed or guaranteed. Each Holder by its acceptance hereof agrees to
be bound by such provisions and authorizes and expressly directs the Trustee, on
its behalf, to take such action as may be necessary or appropriate to effectuate
the subordination provided for in the Indenture and appoints the Trustee its
attorney-in-fact for such purposes.

            (16) SUCCESSORS. When a successor assumes, in accordance with the
Indenture, all the obligations of its predecessor under the Notes and the
Indenture, the predecessor, subject to certain exceptions, will be released from
those obligations.

            (17) DEFAULTS AND REMEDIES. Except as set forth in the Indenture, if
an Event of Default occurs and is continuing, the Trustee or the Holders of not
less than 25% in principal amount of Notes then outstanding may declare all the
Notes to be due and payable in the manner, at the time and with the effect
provided in the Indenture. Holders of Notes may not enforce the Indenture or the
Notes except as provided in the Indenture. The Trustee is not obligated to
enforce the Indenture or the Notes unless it has received indemnity reasonably
satisfactory to it. The Indenture permits, subject to certain limitations
therein provided, Holders of a majority in aggregate principal amount of the
Notes then outstanding to direct the Trustee in its exercise of any trust or
power. The Trustee may withhold from Holders of Notes notice of any continuing
Default or Event of Default (except a Default in payment of principal, premium,
if any, or interest when due, for any reason or a Default in compliance with
ARTICLE V of the Indenture) if it determines that withholding notice is in their
interest.

            (18) TRUSTEE DEALINGS WITH LNR. The Trustee under the Indenture, in
its individual or any other capacity, may become the owner or pledgee of Notes
and may otherwise deal with LNR, its Subsidiaries or their respective Affiliates
as if it were not the Trustee.

            (19) NO RECOURSE AGAINST OTHERS. No partner, director, officer,
employee or stockholder, as such, of LNR shall have any liability for any
obligations of LNR under the Notes or the Indenture or for any claim based on,
in respect of, or by reason of, such obligations or their creation. Each Holder
of Notes by accepting a Note waives and releases all such liability. The waiver
and release are part of the consideration for the issuance of the Notes.


                                      A-7
<PAGE>
            (20) AUTHENTICATION. This Note shall not be valid until the Trustee
or Authenticating Agent manually signs the certificate of authentication on this
Note.

            (21) GOVERNING LAW. This Note and the Indenture shall be governed by
and construed in accordance with the laws of the State of New York, including
Section 5-1401 of the General Obligations Law of the State of New York, but
otherwise without regard to conflict of laws rules that would apply the laws of
any other jurisdiction. Each of the parties hereto and the Holders agree to
submit to the jurisdiction of the courts of the County of New York, State of New
York or of the United States of America for the Southern District of New York in
any action or proceeding arising out of or relating to this Note.

            (22) ABBREVIATIONS AND DEFINED TERMS. Customary abbreviations may be
used in the name of a Holder of a Note or an assignee, such as: TEN COM (=
tenants in common), TEN ENT (= tenants by the entireties), JT TEN (= joint
tenants with right of survivorship and not as tenants in common), CUST (=
Custodian), and U/G/M/A (= Uniform Gifts to Minors Act).

            (23) CUSIP NUMBERS. Pursuant to a recommendation promulgated by the
Committee on Uniform Security Identification Procedures, LNR has caused CUSIP
numbers to be printed on the Notes as a convenience to the Holders of the Notes.
No representation is made as to the accuracy of such numbers as printed on the
Notes and reliance may be placed only on the other identification numbers
printed hereon.

            LNR will furnish to any Holder of a Note upon written request and
without charge a copy of the Indenture, which includes the text of this Note.
Requests may be made to: LNR Property Corporation, 1601 Washington Avenue, Suite
800, Miami Beach, FL 33139.


                                      A-8
<PAGE>
                              ASSIGNMENT FORM


           If you, the Holder, want to assign this Note, fill in the form below
and have your signature guaranteed:

            I or we assign and transfer this Note to:
            ____________________________________________
            ____________________________________________
            ____________________________________________
              (Print or type name, address and zip code and
              social security or tax ID number of assignee)

and irrevocably appoint _____________________, agent to transfer this Note
on the books of LNR.  The agent may substitute another to act for him.

Dated:  ______________

                                    Signed:  _______________________
                                    (Sign exactly as your name appears
                                    on the other side of this Note)

Signature Guarantee:  ________________________

           Signature must be guaranteed by an "eligible guarantor institution,"
that is, a bank, stockbroker, savings and loan association or credit union
meeting the requirements of the Registrar, which requirements include membership
or participation in the Securities Transfer Agents Medallion Program ("STAMP")
or such other "signature guarantee program" as may be determined by the
Registrar in addition to, or in substitution for, STAMP, all in accordance with
the Securities Exchange Act of 1934.

           In connection with any transfer of this Note occurring prior to the
date which is the earlier of (i) the date of the declaration by the Commission
of the effectiveness of a registration statement under the Securities Act of
1933, as amended (the "SECURITIES ACT"), covering resales of this Note (which
effectiveness shall not have been suspended or terminated at the date of the
transfer) and (ii) the second anniversary of the Issue Date (PROVIDED, HOWEVER,
that neither LNR nor any affiliate of LNR has held any beneficial interest in
such Note, or portion thereof, or any predecessor security at any time on or
prior to the second anniversary of the Issue Date), the undersigned confirms
that it has not utilized any general solicitation or general advertising in
connection with the transfer:

                                   [Check One]

(1) ___     to LNR or a Subsidiary thereof; or

(2) ___     pursuant to and in compliance with Rule 144A under the
            Securities Act; or


                                      A-9
<PAGE>
(3) ___     to an institutional "accredited investor" (as defined in Rule
            501(a)(1), (2), (3) or (7) under the Securities Act) that has
            furnished to the Trustee a signed letter containing certain
            representations and agreements (the form of which letter can
            be obtained from the Trustee); or

(4) ___     outside the United States to a "foreign person" in compliance
            with Rule 904 of Regulation S under the Securities Act; or

(5) ___     pursuant to the exemption from registration provided by Rule
            144 under the Securities Act; or

(6) ___     pursuant to an effective registration statement under the
            Securities Act; or

(7) ___     pursuant to another available exemption from the registration
            requirements of the Securities Act.

            and unless the box below is checked, the undersigned confirms that
such Note is not being transferred to an "affiliate" of LNR as defined in Rule
144 under the Securities Act (an "Affiliate"):

                   / /   The transferee is an Affiliate of LNR.

            Unless one of the items is checked, the Trustee will refuse to
register any of the Notes evidenced by this certificate in the name of any
person other than the registered Holder thereof; PROVIDED, HOWEVER, that if item
(3), (4), (5) or (7) is checked, LNR or the Trustee may require, prior to
registering any such transfer of the Notes, in their sole discretion, such
written legal opinions, certifications (including an investment letter in the
case of box (3) or (4) and other information as the Trustee or LNR have
reasonably requested to confirm that such transfer is being made pursuant to an
exemption from, or in a transaction not subject to, the registration
requirements of the Securities Act.

           If none of the foregoing items are checked, the Trustee or Registrar
shall not be obligated to register this Note in the name of any person other
than the Holder hereof unless and until the conditions to any such transfer of
registration set forth herein and in SECTION 2.17 of the Indenture shall have
been satisfied.

Dated:  ___________________         Signed:  ________________________
                                    (Sign exactly as your name appears
                                    on the other side of this Note)

Signature Guarantee:  ___________________________


              TO BE COMPLETED BY PURCHASER IF (2) ABOVE IS CHECKED

           The undersigned represents and warrants that it is purchasing this
Note for its own account or an account with respect to which it exercises sole
investment discretion and that it and any such account is a "qualified
institutional buyer" within the meaning of Rule 144A under the


                                      A-10
<PAGE>
Securities Act and is aware that the sale to it is being made in reliance on
Rule 144A and acknowledges that it has received such information regarding LNR
as the undersigned has requested pursuant to Rule 144A or has determined not to
request such information and that it is aware that the transferor is relying
upon the undersigned's foregoing representations in order to claim the exemption
from registration provided by Rule 144A.

Dated: __________________________   ____________________________________________

                                    NOTICE:     To be executed by
                                                an executive officer


                                      A-11
<PAGE>
                      [OPTION OF HOLDER TO ELECT PURCHASE]


            If you want to elect to have this Note purchased by LNR pursuant to
SECTION 4.14 of the Indenture, check the box below:

            / /

            If you want to elect to have only part of this Note purchased by LNR
pursuant to SECTION 4.14 of the Indenture, state the amount you elect to have
purchased:

$_________________



Dated: _________________      __________________________________________________

                              NOTICE: The signature on this assignment must
                              correspond with the name as it appears upon the
                              face of the within Note in every particular
                              without alteration or enlargement or any change
                              whatsoever and be guaranteed.

Signature Guarantee:  ________________________


                                      A-12
<PAGE>
                                                                       EXHIBIT B

                          CUSIP No.: __________________

                            LNR PROPERTY CORPORATION

                7.25% SENIOR SUBORDINATED NOTE DUE 2013, SERIES B

Number _________                                                 $______________
Interest Payment Dates:       April 15 and October 15, commencing April 15, 2004
Record Dates:               March 31 and September 30, commencing March 31, 2004

      LNR PROPERTY CORPORATION, a Delaware corporation ("LNR", which term
includes any successor entities), for value received promises to pay to
_________________ or registered assigns the principal sum of __________________
Dollars on October 15, 2013.

      Reference is made to the further provisions of this Note contained herein,
which will for all purposes have the same effect as if set forth at this place.

      IN WITNESS WHEREOF, LNR has caused this Note to be signed manually or by
facsimile by its duly authorized officers.

                                         LNR PROPERTY CORPORATION

                                         By:  __________________________________
                                              Name:
                                              Title:


Dated:


                                       B-1
<PAGE>
                          Certificate of Authentication

      This is one of the 7.25% Senior Subordinated Notes due 2013, Series B,
referred to in the within-mentioned Indenture.

                                         U.S. BANK TRUST NATIONAL
                                         ASSOCIATION, as Trustee

                                         By:  __________________________________
                                         Name:  ________________________________
                                         Title:  _______________________________

Date of Authentication:  ____________________


                                      B-2
<PAGE>
                              (REVERSE OF SECURITY)

                7.25% Senior Subordinated Note due 2013, Series B

      Capitalized terms used and not otherwise defined herein shall have the
meanings ascribed to them in the Indenture, dated as of October 29, 2003 (the
"INDENTURE"), and as amended from time to time, by and between LNR PROPERTY
CORPORATION, a Delaware corporation ("LNR") and U.S. BANK TRUST NATIONAL
ASSOCIATION, as trustee (the "TRUSTEE").

      (1) INTEREST. LNR promises to pay interest on the principal amount of this
Note at the rate per annum above. Interest on the Notes will accrue from the
most recent date to which interest has been paid or, if no interest has been
paid, from October 29, 2003. LNR will pay interest semi-annually in arrears on
each Interest Payment Date. Interest will be computed on the basis of a 360-day
year of twelve 30-day months and, in the case of a partial month, the actual
number of days elapsed.

      LNR shall pay interest on overdue principal and, to the extent lawful, on
overdue installments of interest (without regard to any applicable grace
periods) from time to time on demand at the rate borne by the Notes.

      (2) METHOD OF PAYMENT. LNR shall pay interest on the Notes (except
defaulted interest) to the Persons who are the registered Holders at the close
of business on the Record Date immediately preceding the Interest Payment Date
even if the Notes are canceled on registration of transfer or registration of
exchange (including pursuant to a Change of Control Offer) after such Record
Date. Holders must surrender Notes to a Paying Agent to collect principal
payments. LNR shall pay principal and premium, if any, and interest in money of
the United States that at the time of payment is legal tender for payment of
public and private debts ("U.S. LEGAL TENDER"). However, LNR may pay principal
and premium, if any, and interest by check payable in such U.S. Legal Tender.
LNR may deliver any such interest payment to the Paying Agent or to a Holder at
the Holder's registered address.

      (3) PAYING AGENT AND REGISTRAR. Initially, the Trustee will act as Paying
Agent and Registrar. LNR may change any Paying Agent, Registrar or co-Registrar
without notice to the Holders.

      (4) INDENTURE. LNR issued the Notes under the Indenture. This Note is one
of a duly authorized issue of Notes of LNR designated as its 7.25% Senior
Subordinated Notes due 2013, Series B (the "UNRESTRICTED NOTES"), limited to
what may be issued under the Indenture pursuant to SECTIONS 2.2 and 4.12. The
Notes include the Initial Notes, the Private Exchange Notes and the Unrestricted
Notes, issued in exchange for the Initial Notes pursuant to the Registration
Rights Agreement. The Initial Notes, the Private Exchange Notes and the
Unrestricted Notes are treated as a single class of securities under the
Indenture. The terms of the Notes include those stated in the Indenture and
those made part of the Indenture by reference to the Trust Indenture Act of 1939
(15 U.S. Code Sections 77aaa-77bbbb) (the "TIA"), as in effect on the date of
the Indenture. Notwithstanding anything to the contrary herein, the Notes are
subject to all such terms, and Holders of Notes are referred to the Indenture
and the TIA for a statement


                                      B-3
<PAGE>
of such terms. The Notes are general unsecured obligations of LNR. Each Holder,
by accepting a Note, agrees to be bound by all of the terms and provisions of
the Indenture, as the same may be amended from time to time in accordance with
its terms.

      (5) REDEMPTION. The Notes are redeemable, at LNR's option, in whole or in
part from time to time, at any time on or after October 15, 2008 upon not less
than 30 nor more than 60 days' notice, at the following Redemption Prices
(expressed as percentages of the principal amount thereof) if redeemed during
the twelve-month period commencing on October 15 of the years set forth below,
plus, in each case, accrued and unpaid interest thereon, if any, to the date of
redemption:

<TABLE>
<CAPTION>
      Year                                                    Percentage
      ----                                                    ----------
<S>                                                           <C>
      2008.................................................    103.625%
      2009.................................................    102.417%
      2010.................................................    101.208%
      2011 and thereafter..................................    100.000%
</TABLE>

      Notwithstanding the foregoing, at any time, or from time to time, on or
prior to October 15, 2006, LNR may, at its option, redeem, with the net cash
proceeds of one or more Public Equity Offerings by LNR, up to 35% of the
aggregate principal amount of the Notes issued and sold by LNR at a redemption
price equal to 107.25% of the principal amount thereof, plus accrued interest
thereon, if any, to the date of redemption, PROVIDED, that at least 65% of the
aggregate principal amount of the Notes issued and sold by LNR remain
outstanding immediately following such redemption. In order to effect the
foregoing redemption with the proceeds of any Public Equity Offering, LNR shall
make such redemption not more than 60 days after the consummation of any such
Public Equity Offering.

      (6) NOTICE OF REDEMPTION. Notice of redemption will be mailed at least 30
but not more than 60 days before the Redemption Date to each Holder of Notes to
be redeemed at its registered address. Notes in denominations larger than $1,000
may be redeemed in part.

      Except as set forth in the Indenture, if monies for the redemption of the
Notes called for redemption shall have been deposited with the Paying Agent for
redemption on such Redemption Date, then, unless LNR defaults in the payment of
such Redemption Price plus accrued interest, if any, the Notes called for
redemption will cease to bear interest from and after such Redemption Date and
the only right of the Holders of such Notes will be to receive payment of the
Redemption Price plus accrued interest, if any.

      (7) CHANGE OF CONTROL OFFER. The Indenture provide that, upon the
occurrence of a Change of Control, and subject to further limitations contained
therein, LNR will make a Change of Control Offer to purchase the Notes in
accordance with the procedures set forth in the Indenture.

      (8) DENOMINATIONS; TRANSFER; EXCHANGE. The Notes are in registered form,
without coupons, in denominations of $1,000 and integral multiples of $1,000. A
Holder shall register the transfer of or exchange of Notes in accordance with
the Indenture. The Registrar


                                      B-4
<PAGE>
may require a Holder, among other things, to furnish appropriate endorsements
and transfer documents and to pay certain transfer taxes or similar governmental
charges payable in connection therewith required by law or as permitted by the
Indenture. The Registrar need not register the transfer of or exchange of any
Notes or portions thereof selected for redemption, except for the unredeemed
portion of any Note being redeemed in part.

      (9) PERSONS DEEMED OWNERS. The registered Holder of a Note shall be
treated as the owner of it for all purposes.

      (10) UNCLAIMED MONEY. If money for the payment of principal, premium, if
any, or interest remains unclaimed for one year, the Trustee and the Paying
Agent will pay the money back to LNR. After that, all liability of the Trustee
and such Paying Agent with respect to such money shall cease.

      (11) DISCHARGE PRIOR TO REDEMPTION OR MATURITY. If LNR at any time
deposits with the Trustee U.S. Legal Tender or U.S. Government Obligations
sufficient to pay the principal of and premium, if any, and interest on the
Notes to redemption or maturity and complies with the other provisions of the
Indenture relating thereto, LNR will be discharged from certain provisions of
the Indenture and the Notes (including certain covenants, but including, under
certain circumstances, its obligation to pay the principal of and interest on
the Notes but without affecting the rights of the Holders to receive such
amounts from such deposit).

      (12) AMENDMENT; SUPPLEMENT; WAIVER. Subject to certain exceptions set
forth in the Indenture, the Indenture or the Notes may be amended or
supplemented with the written consent of the Holders of not less than a majority
in aggregate principal amount of the Notes then outstanding, and any past
Default or Event of Default or noncompliance with any provision may be waived
with the written consent of the Holders of not less than a majority in aggregate
principal amount of the Notes then outstanding. Without notice to or consent of
any Holder, the parties thereto may amend or supplement the Indenture or the
Notes to, among other things, cure any ambiguity, defect or inconsistency,
provide for uncertificated Notes in addition to or in place of certificated
Notes, comply with any requirements of the Commission in order to effect or
maintain the qualification of the Indenture under the TIA or comply with SECTION
5.1 of the Indenture or make any other change that does not adversely affect the
rights of any Holder of a Note in any material respect.

      (13) RESTRICTIVE COVENANTS. The Indenture imposes certain limitations on
the ability of LNR and its Subsidiaries to, among other things, incur additional
Indebtedness, make payments in respect of its Capital Stock or certain
Indebtedness, create or incur liens, enter into transactions with Affiliates,
create dividend or other payment restrictions affecting Subsidiaries, issue
Preferred Stock of its Subsidiaries, and on the ability of LNR to merge or
consolidate with any other Person or sell, assign, transfer, lease, convey or
otherwise dispose of all or substantially all of LNR's and its Subsidiaries'
assets or adopt a plan of liquidation. Such limitations are subject to a number
of important qualifications and exceptions. Pursuant to the Indenture, LNR must
annually report to the Trustee on compliance with such limitations.

      (14) SUBORDINATION. The Notes are subordinated in right of payment, in the
manner and to the extent set forth in the Indenture, to the prior payment in
full in cash or Cash


                                      B-5
<PAGE>
Equivalents of all Obligations on Senior Indebtedness of LNR, whether
outstanding on the date of the Indenture or thereafter created, incurred,
assumed or guaranteed. Each Holder by its acceptance hereof agrees to be bound
by such provisions and authorizes and expressly directs the Trustee, on its
behalf, to take such action as may be necessary or appropriate to effectuate the
subordination provided for in the Indenture and appoints the Trustee its
attorney-in-fact for such purposes.

      (15) SUCCESSORS. When a successor assumes, in accordance with the
Indenture, all the obligations of its predecessor under the Notes and the
Indenture, the predecessor, subject to certain exceptions, will be released from
those obligations.

      (16) DEFAULTS AND REMEDIES. Except as set forth in the Indenture, if an
Event of Default occurs and is continuing, the Trustee or the Holders of not
less than 25% in principal amount of Notes then outstanding may declare all the
Notes to be due and payable in the manner, at the time and with the effect
provided in the Indenture. Holders of Notes may not enforce the Indenture or the
Notes except as provided in the Indenture. The Trustee is not obligated to
enforce the Indenture or the Notes unless it has received indemnity reasonably
satisfactory to it. The Indenture permits, subject to certain limitations
therein provided, Holders of a majority in aggregate principal amount of the
Notes then outstanding to direct the Trustee in its exercise of any trust or
power. The Trustee may withhold from Holders of Notes notice of any continuing
Default or Event of Default (except a Default in payment of principal, premium,
if any, or interest when due, for any reason or a Default in compliance with
ARTICLE V of the Indenture) if it determines that withholding notice is in their
interest.

      (17) TRUSTEE DEALINGS WITH LNR. The Trustee under the Indenture, in its
individual or any other capacity, may become the owner or pledgee of Notes and
may otherwise deal with LNR, its Subsidiaries or their respective Affiliates as
if it were not the Trustee.

      (18) NO RECOURSE AGAINST OTHERS. No partner, director, officer, employee
or stockholder, as such, of LNR shall have any liability for any obligations of
LNR under the Notes or the Indenture or for any claim based on, in respect of,
or by reason of, such obligations or their creation. Each Holder of Notes by
accepting a Note waives and releases all such liability. The waiver and release
are part of the consideration for the issuance of the Notes.

      (19) AUTHENTICATION. This Note shall not be valid until the Trustee or
Authenticating Agent manually signs the certificate of authentication on this
Note.

      (20) GOVERNING LAW. This Note and the Indenture shall be governed by and
construed in accordance with the laws of the State of New York, including
Section 5-1401 of the General Obligations Law of the State of New York, but
otherwise without regard to conflict of laws rules that would apply the laws of
any other jurisdiction. Each of the parties hereto and the Holders agree to
submit to the jurisdiction of the courts of the County of New York, State of New
York or of the United States of America for the Southern District of New York in
any action or proceeding arising out of or relating to this Note.

      (21) ABBREVIATIONS AND DEFINED TERMS. Customary abbreviations may be used
in the name of a Holder of a Note or an assignee, such as: TEN COM (= tenants in


                                      B-6
<PAGE>
common), TEN ENT (= tenants by the entireties), JT TEN (= joint tenants with
right of survivorship and not as tenants in common), CUST (= Custodian), and
U/G/M/A (= Uniform Gifts to Minors Act).

      (22) CUSIP NUMBERS. Pursuant to a recommendation promulgated by the
Committee on Uniform Security Identification Procedures, LNR has caused CUSIP
numbers to be printed on the Notes as a convenience to the Holders of the Notes.
No representation is made as to the accuracy of such numbers as printed on the
Notes and reliance may be placed only on the other identification numbers
printed hereon.

      LNR will furnish to any Holder of a Note upon written request and without
charge a copy of the Indenture, which includes the text of this Note. Requests
may be made to: LNR Property Corporation, 1601 Washington Avenue, Suite 800,
Miami Beach, FL 33139.


                                      B-7
<PAGE>
                                 ASSIGNMENT FORM

      If you, the Holder, want to assign this Note, fill in the form below and
have your signature guaranteed:

      I or we assign and transfer this Note to:

      _________________________________________________
      _________________________________________________
      _________________________________________________
      (Print or type name, address and zip code and social security or
                        tax ID number of assignee)

and irrevocably appoint ________________________, agent to transfer this Note on
the books of LNR. The agent may substitute another to act for him.

Dated:  ____________                         Signed:  ______________________
                                             (Sign exactly as your name appears
                                             on the other side of this Note)

Signature Guarantee:  ______________________

      Signature must be guaranteed by an "eligible guarantor institution," that
is, a bank, stockbroker, savings and loan association or credit union meeting
the requirements of the Registrar, which requirements include membership or
participation in the Securities Transfer Agents Medallion Program ("STAMP") or
such other "signature guarantee program" as may be determined by the Registrar
in addition to, or in substitution for, STAMP, all in accordance with the
Securities Exchange Act of 1934.


                                      B-8
<PAGE>
                      [OPTION OF HOLDER TO ELECT PURCHASE]

      If you want to elect to have this Note purchased by LNR pursuant to
SECTION 4.14 of the Indenture, check the box below:

            [ ]

      If you want to elect to have only part of this Note purchased by LNR
pursuant to SECTION 4.14 of the Indenture, state the amount you elect to have
purchased:

$______________________



Dated:_________________         ________________________________________________

                                    NOTICE: The signature on this assignment
                                    must correspond with the name as it appears
                                    upon the face of the within Note in every
                                    particular without alteration or enlargement
                                    or any change whatsoever and be guaranteed.

Signature Guarantee:  __________________


                                      B-9
<PAGE>
                                                                       EXHIBIT C

      UNLESS AND UNTIL IT IS EXCHANGED IN WHOLE OR IN PART FOR SECURITIES IN
DEFINITIVE FORM, THIS SECURITY MAY NOT BE TRANSFERRED EXCEPT AS A WHOLE BY THE
DEPOSITARY TO A NOMINEE OF THE DEPOSITARY, OR BY ANY SUCH NOMINEE OF THE
DEPOSITARY, OR BY THE DEPOSITARY OR NOMINEE OF SUCH SUCCESSOR DEPOSITARY OR ANY
SUCH NOMINEE TO A SUCCESSOR DEPOSITARY OR A NOMINEE OF SUCH SUCCESSOR
DEPOSITARY. UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE
OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO LNR OR ITS
AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE
ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR SUCH OTHER NAME AS IS
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT HEREON IS MADE
TO CEDE & CO. REPRESENTATIVE OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR
VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED
OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.

      TRANSFERS OF THIS GLOBAL SECURITY SHALL BE LIMITED TO TRANSFERS IN WHOLE,
BUT NOT IN PART, TO NOMINEES OF CEDE & CO. OR TO A SUCCESSOR THEREOF OR SUCH
SUCCESSOR'S NOMINEE AND TRANSFERS OF PORTIONS OF THIS GLOBAL SECURITY SHALL BE
LIMITED TO TRANSFERS MADE IN ACCORDANCE WITH THE RESTRICTIONS SET FORTH IN
SECTION 2.17 OF THE INDENTURE.


                                      C-1
<PAGE>
                                                                       EXHIBIT D

                            Form of Certificate To Be
                          Delivered in Connection with
                    Transfers to Non-QIB Accredited Investors

                                     [Date]

__________________
__________________
New York, New York

Ladies and Gentlemen:

            In connection with our proposed purchase of 7.25% Senior
Subordinated Notes due 2013 (the "Notes") of LNR PROPERTY CORPORATION ("LNR"),
we confirm that:

            1. We understand that any subsequent transfer of the Notes is
      subject to certain restrictions and conditions set forth in the indenture
      relating to the Notes (the "INDENTURE") and the undersigned agrees to be
      bound by, and not to resell, pledge or otherwise transfer the Notes except
      in compliance with, such restrictions and conditions and the Securities
      Act of 1933, as amended (the "SECURITIES ACT"), and all applicable State
      securities laws.

            2. We understand that the offer and sale of the Notes have not been
      registered under the Securities Act or any other applicable securities
      law, and that the Notes may not be offered or sold within the United
      States or to, or for the account or benefit of, U.S. persons except as
      permitted in the following sentence. We agree, on our own behalf and on
      behalf of any accounts for which we are acting as hereinafter stated, that
      if we should sell any Notes, we will do so only (i) to LNR or any
      subsidiary thereof, (ii) inside the United States in accordance with Rule
      144A under the Securities Act to a person who we reasonably believe is a
      "qualified institutional buyer" (as defined in Rule 144A promulgated under
      the Securities Act), (iii) inside the United States to an institutional
      "accredited investor" (as defined below) that, prior to such transfer,
      furnishes (or has furnished on its behalf by a U.S. broker-dealer) to the
      Trustee (as defined in the Indenture) a signed letter containing certain
      representations and agreements relating to the restrictions on transfer of
      the Notes (the form of which letter can be obtained from the Trustee),
      (iv) outside the United States in accordance with Rule 904 of Regulation S
      promulgated under the Securities Act, (v) pursuant to the exemption from
      registration provided by Rule 144 under the Securities Act (if available),
      or (vi) pursuant to an effective registration statement under the
      Securities Act, and we further agree to provide to any person purchasing
      any of the Notes from us a notice advising such purchaser that resales of
      the Notes are restricted as stated herein.

            3. We understand that, on any proposed resale of any Notes, we will
      be required to furnish to the Trustee, LNR such certification, legal
      opinions and other information as the Trustee and LNR may reasonably
      require to confirm that the proposed


                                      D-1
<PAGE>
      sale complies with the foregoing restrictions. We further understand that
      the Notes purchased by us will bear a legend to the foregoing effect.

            4. We are an institutional "accredited investor" (as defined in Rule
      501(a)(1), (2), (3) or (7) of Regulation D under the Securities Act) and
      have such knowledge and experience in financial and business matters as to
      be capable of evaluating the merits and risks of our investment in the
      Notes, and we and any accounts for which we are acting are each able to
      bear the economic risk of our or their investment, as the case may be.

            5. We are acquiring the Notes purchased by us for our account or for
      one or more accounts (each of which is an institutional "accredited
      investor") as to each of which we exercise sole investment discretion.

            6. We have received a copy of LNR's Offering Memorandum dated
      October 15, 2003, and acknowledge that we have had access to such
      financial and other information, and have been afforded the opportunity to
      ask such questions of representatives of LNR and receive answers thereto,
      as we deem necessary in connection with our decision to purchase the
      Notes.

            You, LNR, the Trustee, the Initial Purchasers and others are
entitled to rely upon this letter and are irrevocably authorized to produce this
letter or a copy hereof to any interested party in any administrative or legal
proceeding or official inquiry with respect to the matters covered hereby.

                                        Very truly yours,

                                        [Name of Transferee]

                                        By:   __________________________________
                                              Name:
                                              Title:



                                      D-2
<PAGE>
                                                                       EXHIBIT E

                       Form of Certificate To Be Delivered
                          in Connection with Transfers
                            Pursuant to Regulation S


__________________
__________________
New York, New York

            Re:   LNR PROPERTY CORPORATION ("LNR")
                  7.25% Senior Subordinated Notes due 2013 (the "NOTES")

            Ladies and Gentlemen:

            In connection with our proposed sale of $__________ aggregate
principal amount of the Notes, we confirm that such sale has been effected
pursuant to and in accordance with Regulation S under the U.S. Securities Act of
1933, as amended (the "SECURITIES ACT"), and, accordingly, we represent that:

            (1) the offer of the Notes was not made to a person in the United
      States;

            (2) either (a) at the time the buy offer was originated, the
      transferee was outside the United States or we and any person acting on
      our behalf reasonably believed that the transferee was outside the United
      States, or (b) the transaction was executed in, on or through the
      facilities of a designated offshore securities market and neither we nor
      any person acting on our behalf knows that the transaction has been
      prearranged with a buyer in the United States;

            (3) no directed selling efforts have been made in the United States
      in contravention of the requirements of Rule 903(b) or Rule 904(b) of
      Regulation S, as applicable;

            (4) the transaction is not part of a plan or scheme to evade the
      registration requirements of the Securities Act; and

            (5) we have advised the transferee of the transfer restrictions
      applicable to the Notes.


                                      E-1
<PAGE>
            You, LNR and counsel for LNR are entitled to rely upon this letter
and are irrevocably authorized to produce this letter or a copy hereof to any
interested party in any administrative or legal proceedings or official inquiry
with respect to the matters covered hereby. Terms used in this certificate have
the meanings set forth in Regulation S.

                                         Very truly yours,

                                         [Name of Transferee]

                                         By: ___________________________________
                                             Name:
                                             Title:


                                      E-2